Epitaph for the U.S. dollar

It is now getting more and more the clear that the strength of the dollar is not what it used to be. The US dollar has existed for around 100 years but as you look at the history of fiat currency, the US dollar as a fiat currency has already existed 39 years out of an average 80 years. Looking from this angle, it would seem that the US dollar is on its exit path. There are many reasons to indicate so.

The main reason

US dollar has evolved from being an asset-based currency into the currently debt based status. A few hundred centuries ago, money was strictly asset based through gold or silver with an intrinsic worth that you had it close with you all the time; you would be a case of ‘you are what you are worth’ quite literally.

We have had famous explorers such as Marco Polo who traveled around the world using European silver and gold to trade for Asian products like silk and spices, making gold and silver the widely acceptable monetary unit then until now, where daily commerce is performed via coin money. Coin money was also used in trade before the Civil War came on. Time and again in history, gold and silver were the preferred choices of trade, especially when the California gold rush saw a great natural supply to fuel the US economy.

Federal Reserve

The US Federal Reserve came on in early 1900s to streamline and regulate the banking processes. Silver and gold coins were the major form of currency but these were heavy and hard to carry and store. Hence, the Fed came up with certificates to replace the bulk of gold and silver which could be exchanged back to the precious metals. It put up a market value of $20 for every ounce of gold with a switch to paper money as the standard currency based on the gold exchange rate.

Gold and silver coins were considered real money; meaning, you are only as rich as the amount of these precious metals in your possession. This is called asset based money or currency which limited the amount of money in circulation in relation to the amount of gold and silver available. When you have such a currency that is controlled, there is no debt.

Simplicity

When paper money was introduced and became the standard currency form, its worth was based on the amount of gold and silver the nation had; meaning, you could only print one piece of paper money if the Fed had only one piece of gold of that worth.

It was all so simple until President Nixon came on the scene and took the US off of the gold standard.

CHOOSING A GOLD TRADING COMPANY

Factors to take into consideration

There are many factors to take into consideration while seeking the most appropriate company for gold trading; the offers, safety and security are only some of the most important. There are many such companies waiting to be chosen, especially in the United States. With all these factors to consider, one has to be sure of the choice he or she makes.

One of the most important associations is called the BBB, or Better Business Bureau. Many important companies are part of this association, as it is safe and reliable. Check the background of the company; it is reliable only if it receives a high rating from former clients. So, the first question to ask is whether the company is a member of the BBB or not.

Although the longevity of a company is not important in terms of the services it provides, it is not advisable to deal with very new trading companies. After the gold industry rose on the market, the numbers of this type of company rose significantly. Try to do business with a company that survived both the good and the bad periods.

Connecting with a trading company

When you try to create a connection with a trading company, it is advisable to choose the company that has the education of its clients as its top priority. If you want to start doing business in the gold industry, don’t hesitate to ask for help from those who already have some experience in the field. If a company doesn’t meet your needs and expectations, you should look for another one.

Another important aspect about a trading company is the efficiency of its methods. Being in touch with the latest news and information from the field is very important, especially for a company that deals with the gold industry. In order to make the right choice, pay attention to the company’s way of improving its services. Since we live in a world full of unreliable people, we all look for safety, especially when doing business. A company that uses gold as its tool of doing business should also have a legal department as a component. When a company doesn’t have relations with certain banks and legal institutions, it surely has problems, so it is better for you not to choose it in order to help you with your business idea. Regardless of the trading company you choose, keep in mind that the gold industry is a harsh one. You need to inform yourself in detail before taking the next step.

A QUICK GUIDE TO Gold Bullion Coins

It is one of those special hobbies in which not everyone would indulge although there are no bounds for anyone who is interested in buying gold coins. However, there are many different types of gold coins on the market for you to consider including in your new or current collection. Others may want these gold coins for investment purposes.

The More Popular Gold Coins

The following lists some of the preferred gold coins by the public. They are:

American Gold Eagle

This gold coin began minting in 1986 by law with a specification of copper-silver alloy for a more sturdy appearance to endure against wear and tear. This gold coin of the American Gold Eagle became the nation’s official bullion gold with Lady Liberty carrying the torch on the front side. The American Eagle gold coins are available in 1/10oz, 1/4oz, 1/2oz and 1 full ounce weights.

South Africa Krugerrand

This gold coin is the product of South Africa where it is minted from a durable gold alloy. The image of the previous President of South Africa, Paul Kruger, is imprinted on one side with Springbok on the other side.

Chevronets

The gold Chevronets was introduced by Russia in 1701 to replace the nation’s Ruble in 1757. However, the Russian Revolution caused a temporary halt of the Chevronets’ minting until the revolution ended. The authorities resumed Chevronets production in an attempt to ease out the devaluing Ruble; however, production of the Chevronets halted again in 1926. The Moscow Olympics in 1980 saw the revival of the 1925 Chevronets as a commemoration of the grand and prestigious event.

Britannia Gold

Britannia gold is Britain’s pride and joy with 22 carat and a mixture of 91.7% gold and silver or copper. The Britannia became the British’s official coin amongst its gold bullion collection. Britannia gold coins are available in ten pound denomination of 1/10 ounce troy gold, twenty-five pound denomination of ¼ ounce troy gold and fifty pound denomination of ½ ounce troy gold.

Gold Panda

The Gold Panda was minted with 99.9% gold by the Chinese with the Temple of Heaven imprinted on one of its sides. Though minting was frozen in 2002, it was resumed after much popular demand by coin collectors.

Islamic Gold Dinar

Malaysia also produced its own Kelantanese Dinar in September 2006 where these gold dinars were to be used in that state alone for paying dowries in accordance with the state’s Islamic Law, purchase of merchandise and even savings.

Gold Maple Leaf

The Royal Canadian Mint produced this Gold Maple Leaf gold coin from its locally mined gold that is 99.9% pure gold. There are two versions of the Gold Maple Leaf: normal and deluxe standard. This Maple Leaf gold coin can fetch $1,000,000 on the market with its 100kg weight at 3cm thick and 55cm wide in 2007.

Why It’s Important to Invest in Gold

In recent years, the demand for gold coins has shot to very great heights thus increasing its prices. It is true to say that more investors are becoming very interested in this precious commodity because of its various properties, especially the fact that it is a liquid form of asset that can come in handy in times of need.

The commodity, as well as its stocks, have strongly rocketed in the bull market in recent times creating increased profits for those who have bought in. Although the price of this precious metal is determined by its level of supply and demand, its purchasing power and value have remained steadfast, increasing instead of decreasing, as is the case with most assets.

What makes the commodity a bull market is its outstanding fundamentals. Although the world’s gold mines are playing their part in supplying the commodity, the tons of gold produced are not enough to meet the ever increasing demand. There is an acute shortage of gold, especially because it is demanded for different purposes, including investment and industrial use, as well as jewelry.

One of the reasons it is important to buy gold coins is the fact that their value is increasing by the year, and so are the prices. This means that if you manage to buy a good quantity of gold at the moment, in the next few months or years you can see substantial growth. The commodity is very convenient as it saves investors from incurring losses since it is not affected by most things that affect other forms of investment assets. This factor greatly reduces major risks to the advantage of the buyer.

As in all products, it is important to do some research and investigate the bullish factors of gold to ensure that your decision is a good one and that you have an investment strategy that will work for you. One of the most important things to understand is the gold market behavior, as well as demand-supply trends and the prices of gold.

Gold Coins as an Investment

It is up to an interested investor to know the various ways to invest in gold. Gold is a commodity that is gaining in value making the prices shoot up as the years go by. The value of gold has never been zero; it has a lot of advantages and its purchasing power has remained steady. Gold investment comes in various forms; an investor can choose to suit his needs.

Small bars and coins

These small amounts of gold have been legal since the reign of King Croesus who ruled Lydia in Western Asia. What is particular about this king is that his wealth mainly came from the gold sands and mines of the Pactolus River, making them legal tender. Small coins and bars are an attractive means of investing for most investors especially because any gold meant for investment purposes is exempted from VAT in many countries and from the European Union as a whole.

Bullion coins

These coins are normally issued by a governing body in most countries. They are considered legal tender because of their face value, not their content of gold. However, in purchasing, the gold content is what gives them value and the premium rates may vary from one dealer to another, as well as from one coin to another.

Bullion coin premiums rely mostly on the size of the coin unlike in numismatic and commemorative coins whose value is determined by their quality and rarity in addition to their gold content.

Small bars of gold

Any bar weighing 100g downwards is considered small. Gold comes in a variety of sizes and weights, which of course vary in value and price. These bars contain 99.5% of fine gold and provide a great platform for investment for interested parties or institutions. There are only 94 accredited brands and gold bar manufacturers in the whole world who produce different types of gold bars.

A potential investor should not limit himself to one method of gold investment. Instead, thorough research can help a great deal when settling for a method of investing and deciding what form of gold one is to invest in. This is largely determined by the various needs of the buyer, as well as the reason he or she is buying and investing in this commodity.

Gold investments should be given the same keen analysis as any other form of investment.

Gold and the dollar

The demand for buying gold coins is increasing with every passing day. Since this commodity is known for withstanding depreciation, more investors regard it highly as the protector of their wealth. This is not only in the case of inflation, but also against other world currencies depending on what part of the world an buyer is situated in.

Gold has a good reputation, most especially when it comes to the US dollar, which is the main trading currency of the world. This commodity has proven to be an effective hedge surrounding the fluctuation of the dollar. This aspect about the precious commodity had been formalized in recent statistics making the demand shoot upwards and the price increase.

Research has proven that over the years gold has been an effective dollar hedge comparing its price and the exchange rate of other currencies of the world. It has been found that it correlated consistently negatively with the US dollar across all rates of exchange and over time. Despite economic turbulence over some periods, gold stood firm protecting investors against the instability and the fluctuation of exchange rates.

Other studies have been conducted and have proved that this precious commodity is not only a potent hedge protection against the US dollar, but also provides the dollar with protection when it is at the verge of losing value. This makes the loss very small, which is cleared by the appreciation periods of the dollar.

With this kind of knowledge and information, most investors are becoming wise enough to invest in this commodity rather than other kinds of assets as they know that its value is going to save them during the hard economic times. Gold is not losing value by the day, on the contrary, it is becoming more and more expensive and hard to get as the demand for it is on the increase. Investors and those who know the real value of this commodity are doing everything possible to have it available as a means of making money and maintaining wealth.

Gold has proven to be the most valued commodity over the years and that is not likely to change any time soon. So the more one can manage to invest in this commodity, the better it is for that individual or institution. Those looking for ways to improve their wealth, especially investors, should consider investing in gold as it is never been worth zero.

David Faber Comments on State of US Monetary Policy

Many experts have far from positive views of the economy for the current future we face as Americans. Popular tv economist on CNBC Marc Faber adds "the governments are taking over." He goes on to say that the current federal policies as it relates to money and the economy are not sustainable.

The great fear by many experts is that the Federal Government will continue to just keep printing money. A flood of more money entering the monetary system could cause "whole system breaks down" Faber adds. His comments on the current economic policies were last Thursday's program on CNBC.

"What I object to the current government intervention in so-called 'solving the crisis', (is that) they haven't solved anything. They've just postponed it."

Faber continues that the "ultimate armageddon" would be greater in scope the next it happens, as "governments will go bust", which would lead the Feds to just more money printing.

He continues to comment that China's growth rate is "completely unsustainable in the long run," talking about China which is the current fastest growing economy in the world.

Is Now a Good Time to Buy Gold

If you have listened to the radio or the news lately, you may be asking yourself if gold is a good buy for you. There are plenty of reason why now is a good time to buy gold. The final decision is yours though learning the keys to gold prices is the best way to make an informed decision.

Important to understand the difference between gold stocks called gold ETF's and physical gold. Admissions from companies that trade on the Comex that many of the transactions for gold ETF's are not backed by adequate amounts of physical gold are causes for concern. It is important for financial security for buying gold to be physical gold that you hold in your possession.

There are increasing skepticism over the United States actuall gold reserves. The reported position for the United States is 8,133 tons which is estimated to be worth just over $300 billion. There is no outside audit for the total the US holds which makes the amounts that individuals own more important.

Gold is in the midst of a steady bull market. It has increased in value each year for the last 9 years. If the present value of gold holds true for 2010 it will be 10 years in a row. This has all happen as many in the mainstream media has had negative comments towards gold.

An amazing aspect of gold's value is the fact that most of the mined gold in the world is accounted for. Gold has a great weight to value ratio making it easy to store in private possessions. The ability of gold to hold up against normal abuse makes its a great way to preserve wealth for the long term.

with an unclear economic future ahead for the next few years in America, the fundamentals for gold have many factors that have the ability to produce positive results. For better understanding if now is the best time for you to own gold contact a reputable gold brokerage firm for more information.

Different Forms of Gold that have Value

Gold has many different factors that creates its value. There are those that own gold in the form of jewelry while others own it in the form of gold bars or coins.

Yellow gold which is the most common form of gold that you can find is often not 100% pure. Copper and silver are added to make it more durable as gold itself is a soft metal.

To create what is know as white gold, nickel or platinum are added. White gold is common in jewelry and has a greater expense than jewelry made with yellow gold on average.

Rose gold is another common form of gold used in jewelry and also typically carries a greater value than yellow gold. A combination of gold and copper gives it its reddish tint.

A key aspect to the value of gold is the purity. The purity of gold is often referred to in karat, as 24 karat is considered pure gold. A 22 karat gold watch would be 91.7% pure. Most jewelry is not 24 karat as the copper or silver are added to make the metal harder for daily use.

People also buy gold for the financial value. Gold is considered an asset more than a pure investment. Gold bullion is one of the most popular forms for holding gold in your portfolio. Common gold bullion is the American Gold Eagle, Canadian Gold Maple Leaf, and the South African Krugerrand. Gold bullion can be bought at different weights for each person's different buying needs.

Gold can also be purchased in what is called rare gold coins. Product of these gold coins was stopped in 1933 and have a scarcity factor to them that increases their value. Rare gold coins is considered a private position in gold which is beneficial for many people as a preservation of wealth. To greater understand the difference between gold bullion and rare gold coins it is best to contact a reputable gold brokerage firm for more answers.

Korea Feals Pressure to Add Gold to Foreign Exchange Reserves

According to BNP Paribas Asset Management, the Bank of Korea which has yet to start buying gold is under enormous pressure to start adding gold to its foreign exchange reserves.

The increase in pressure comes from other countries like India, Russia, and China who have bought gold as a defense for currencies reserves. Last year the head of Korea's reserve management unit though gold to be of little value though with uncertain times increasing for financial markets that opinion is changing fast. Currently, Korea is 56th on gold holdings in the work according to World Gold Council.

As signs of a financial recovery are looking more bleak, gold prices are continuing to stay strong near their record high. With falling prices in both the dollar and euro there are not many options for Korea that are not adding physical gold to their foreign exchange reserves.

On August 26th gold traded for $1,239.70 and is up for looks to be its 10 year in a row.

South Korea is the 6th largest foreign exchange reserve in thw world with only 0.03% of their $286 billion in gold. China, Japan, Russia, Taiwan, and India are the top 5 foreign exchange reserves in order. Estimates are that Korea's' gold position is the smallest percentage of any of the top 100 foreign exchange reserve holders.

With fears surfacing of a double dip recession, Goldman Sachs forecasted that gold may exceed $1,300 with in the next 6 months.

Other foreign exchange reserves like Russia added 50000 ounces of gold in the last month increasing their total to 23.3 million ounces.

The euro has lost 12% of its value to the dollar in 2010 which is another set of economic news sending investors and countries to gold. Gold coins have been used in theory as a safe haven as they have never had a value of zero.

Gold Coin Sales Increased Across the Board Last Week

Slower numbers of numismatic gold coin sales have picked up over the last week. According to US Mint sales figures, gold coin buyers have increased sales across the board of numismatic rare gold coins. Also, figures show an increase over the last week in bullion sales as well.

The increase in demand for gold coins included First Spouse Gold Coins, Buffalo Gold proof coins, and Gold Eagles to name a few.

New into gold circulation the James Buchanan Presidential Dollars deputed to orders of 46,096 of the 2 coin rolls. The number is 2,024 lower than the Franklin Pierce debut. Though too early to tell, the James Buchanan $1 US Mint coin may end up being the lowest minted presidential coin.

The Platinum Eagles went on sale August 12th and by August 19th had reached their 10,000 limit. The Platinum Eagles coins were officially added to the US Mint sold out list on August 23rd.

The 2010 Platinum Eagles sold out faster than the last years mintage which took just over a week to sell out.

US Mint Gold Coin Sales in 2010

The year 2010 is turning out to be yet another profitable year for US Mint gold coins. The demands for the coins are at levels last seen in 1999. In fact, the demand is at a level that is threatening to wipe out the gold reserve of the US Mint.

This increase in demand for gold bullion coins coincides with the decline in the value of the dollar. In early 2010, Reuters quoted US Mint spokesperson as saying, “Many investors, both retail and institutional, have sought gold as a safe-haven asset in times of economic uncertainty. Sales of the American Eagle coins increased by 214 percent in the month over April during a time when concerns about sovereign debt in the euro zone raised fears of a larger macro-economic effect.”

US Mint Gold Coins: Fact and Figures for May 2010

In May 2010, the sale of the coin broke all previous records of sales figure for a single month. Regarding this, a US Mint spokesperson said to Reuters, “In January 1999, the U.S. mint sold 208,500 gold 1-ounce coins, with only five other months exceeding May’s gold coin sales since the program was launched in 1986. While in 2010 the U.S. Mint has sold only 1-ounce gold coins, in past years it has sold other coin sizes as well. Comparing only American Eagle gold 1-ounce coins, the biggest monthly sale occurred in October 1986 with 609,500 coins sold.”

In May 2010, the US Mint managed to make record shipping of 190,000 one-ounce gold American Eagles. In June of the same year, the Mint introduced the 22-carat 2010 American Eagle Gold Bullion Fraction Coins and they too managed to attain a sales figure of 310,000 within the first five days of their production. These numbers, although high, fell short of the 2009 sales figure of 345,000 within the first day of going on sale.

This high demand has led to a temporary halt in the production of such coins by the Mint. The official website says, “Production of United States Mint American Eagle Gold Proof and Uncirculated Coins has been temporarily suspended because of unprecedented demand for American Eagle Gold Bullion Coins.” The reproduction will start once they have sufficient numbers of gold bullion blanks.

In August 2010, the US and Western Europe are still facing huge government budget deficits and investors are not showing much faith in the world’s major currencies.

Liberty Gold Coins: A Walk Down Memory Lane

Liberty gold coins are one of the most recognizable coins in the United States. These coins were said to be the building blocks of America’s trade and industry in the 19th and 20th century. Liberty gold coins find a unique place in American history, along with the Great Depression, the likes of Ford, Durrant, Rockefeller, and the American Civil War. Liberty gold coins, in fact, witnessed the birth of industrial America well before Edison invented the light bulb, Bell invented the telephone, and Mark Twain wrote his classics. In the 21st century, Liberty gold coins have found favor with coin collectors, antique dealers, and Wall Street hotshots for their beauty, rarity, and rich historic value. Coins from the original 13 states, both south and north of the Mason-Dixon Line, come under the auctioneer’s hammer regularly.

Liberty Gold Coins: Types

Liberty gold coins were minted in the form of $20 gold coins, $10 gold coins, $5 gold coins, and $2.5 gold coins. Liberty’s production started during 1849 and finally wound up in 1907, but remained in business till 1933. Minted in Philadelphia, San Francisco and New Orleans, these gold coins adorned the collections of Iacocca, Du Pont, and even JFK.
The $20 gold coin, designed by James Longacre, featured Lady Liberty with the word “LIBERTY” inscribed on the bottom of the coin. Thirteen stars, representing the 13 states, encircled the Lady. The other side of the coin featured the American bald eagle with the words “UNITED STATES OF AMERICA” encircling it.

The $10 gold coin, designed by Christian Gobrecht, featured Lady Liberty with the word “LIBERTY” engraved on her coronet. The $10 coin was minted in 1838 and continued till 1907. The reverse side of the coin featured the bald eagle, with three arrows in its talons and perched on olive branches. The eagle was shielded by stars and stripes on its chest. These coins were minted in the Philadelphia and San Francisco mints. The Denver mint joined the bandwagon around 1906.

The $5 gold coins were authorized by the US Congress to be manufactured in the US Mint on April 2, 1792. This coin, also known as the “Half Eagle,” was minted in 1866 and continued till 1908. Struck at seven different American mints through its life, the coin featured Lady Liberty with the word “LIBERTY” engraved on her coronet and adorned by 13 starts that represented each of the 13 states. The reverse side of the coin was identical to the $10 coin with the words “UNITED STATES OF AMERICA” surrounding the eagle.

The $2.50 gold coins were similar to the $10 and $5 counterparts, expect that it was first minted at 1840. The Philly mint started the production and additional coins were struck at Charlotte, New Orleans and Dahlonega.

US Gold Mint: July 2010 Sees High Demand for the One Ounce Gold Eagles

The sale of US Gold Mint bullion coins continued at a high through July 2010. If considered individually, the demand for gold bullions saw a marked shift towards the one ounce coins. This tilt in demand seems to be the after-effect of the previous month’s initial popularity of fractional weight coins.

US Gold Mint: The Bullion Metal Options
July witnessed some new introductions in the US Gold Mint bullion collection:
Silver bullions: In the month of July, the US Gold Mint also offered the one ounce American Silver Eagle. This was the only silver bullion option. However, later in the year, a new five ounce series of silver bullion (whose design has been replicated from the National Park Quarters series) is expected to debut.

Gold bullions: The US Gold Mint offered the 22K American gold Eagle coins in different sizes:
• one ounce
• one-half ounce
• one-quarter ounce
• one-tenth ounce

The 24K American Gold Buffalo was brought out in just one size.
Platinum bullions: The US Gold Mint’s bullion lineup is yet to see the American Platinum Eagle. This coin has not been seen in the bullion format since 2008, but the US mint is all set to release it in August 2010. No price has been fixed on the coin as yet, although NumisMaster.com has speculated an approximately 30% mark-up from the present platinum price.
The following table summarizes the sales figures of the US Mint bullions till July 2010:

JULY 2010 BULLION COIN SALES

Coins July 2010 YTD 2010
American Gold Buffalo 1 oz 23, 000 183, 500
American Silver Eagle 1 oz 2, 981, 000 21, 149, 500
American Gold Eagle 1/10 oz 30, 000 310, 000
American Gold Eagle 1/4 oz 2, 000 46, 000
American Gold Eagle 1/2 oz 2, 000 33, 000
American Gold Eagle 1 oz 147, 500 766, 000

The overall gold bullion sales amounted to 175,000 ounces for the month July. Although this figure was 10,000 ounces lower than the previous month’s level, it was well above the 86,000oz sold during the same period last year. The sales mix shows a heavy inclination towards one ounce Gold Eagles. The rise in demand for the Gold eagles followed the heavy demand for fractional weight coins. For the month of July, the fractional weight gold coins accounted for 2.6% of the complete gold bullion sales, whereas in June, the same accounted for approximately 30% of the sales by weight.

Know the Different Types of Gold Coins

Gold coins were used as currency in the olden times. However, their use as currency was put to an end after the period of the Great Depression, in Twentieth Century. At present, different types of gold coins are purchased by collectors and investors. Investors usually prefer bullion coins for investment purposes.

Major Types of Gold Coins
The two popular types of gold coins found across the world are:

American Gold Eagle

One of the most popular types of gold coins is the American Gold Eagle. This type of bullion coin was first produced in 1986, by the US Mint. Minted in 22-karat gold, these coins bear an image of Lady Liberty on one side and a Family of Eagles on the other side.

They are certified by the US government in terms of their weight, purity and content. The advantage of these coins is that they can be easily converted into cash. The American Gold Eagle coins can be bought in four different gradations:
• One-ounce with a face value of $ 50.
• Half-ounce with a face value of $25.
• Quarter-ounce with a $10 face value.
• Tenth-ounce with a face value of $5.

The elevated level of sales of the US Mint’s bullion gold coins continued till July 2010. The Sales figures of the US Mint’s American Gold Eagle coins for the month of July 2010 are as follows:

July 2010
American Gold Eagle 1/10 oz $30,000
American Gold Eagle 1/4 oz $2,000
American Gold Eagle 1/2 oz $2,000
American Gold Eagle 1 oz $147,500

Canadian Gold Maple Leaf

Another famous type of gold coin is the Canadian gold maple leaf. These gold coins were introduced in 1979 for the first time. The Canadian gold maple leaf coins are produced by the Royal Canadian Mint. These gold coins are formed of 99.99% pure gold. These coins feature the image of Great Britain's Queen Elizabeth II on one side. On the reverse side, they bear the image of Canada’s national symbol, the maple leaf. These coins are backed by the Canadian Government, for their purity and weight. The Canadian maple leaf coins can be purchased in following denominations:
• One ounce with 50 Canadian dollar face value.
• Half-ounce with 20 Canadian dollar face value.
• Quarter-ounce with 10 Canadian dollar face value.
• Tenth-ounce with 5 Canadian dollar face value.

The Royal Canadian Mint has issued an exciting new range of finely crafted gold coins in its third release of the 2010 collector products. The new coins include the 25-cent Birds of Canada and the 50-cent Lenticular Dinosaur Exhibit. Also, the half gram pure mint gold coin and 14 Karat ‘gold maple leaf’ have been introduced.

Things to Know About the 20 Saint Guadens Gold Coins

The 20 Saint Guadens gold coins are also popularly known as the Saint Gaudens Double Eagle or Double Eagle gold coins. These coins were issued by the US Mint from 1907 to 1933. The coins were designed by the acclaimed US sculptor, Augustus Saint-Gaudens. The coins bear the Saint-Gaudens mark, below the date.

The history of the 20 Saint Gaudens gold coins goes back to the 20th century. Saint Gaudens was hired by President Theodore Roosevelt to design coins for the American coinage. However, Saint Gaudens could only design the Double Eagle and the Indian Eagle gold coins before he died. These are considered as some of the most popular designs among hobbyists and collectors.

The value of these numismatic coins is decided by their state of deterioration. The coin’s condition is evaluated by the process of coin grading. The coin grading system evaluates a coin based on its surface, design, element, visible appeal and luster.

$20 Saint Gaudens Gold Coins: The High Relief
The term ‘High Relief’ is often used to describe these coins. Twenty four Proof Double Eagles Saint Gaudens were minted in 1907. These coins were made of 24-karat pure gold. Later on, 11,250, more High Relief $20 Saint Gaudens coins were issued and circulated. However, the images on the coins made them heavier and difficult to store. The original Saint Gaudens coins were then modified to produce a flatter version.

$20 Saint Gaudens Gold Coins of 1908
These $20 Saint Gaudens gold coins are famous because of the omission of the phrase ‘In God We Trust’. The phrase was also omitted from a few coins manufactured in 1907. This was done on the directions of President Roosevelt. The phrase was reintroduced in the Saint Gaudens coins minted in 1908.

The Last Saint Gaudens Gold Coins of 1933
In 1933, owning gold coins were declared illegal by the US government. This was done to stabilize the economy and stop the hoarding of gold currency during the Great Depression of 1939-1940. At this time, all gold coins were melted down. Two Double Eagle gold coins, which survived the melt down, were presented by the US Mint, to the U.S. National Numismatic Collection, at the Smithsonian Institute. These were the only two known legal specimens. However, in 1952, eight more 1933 Double Eagle gold coins were seized by the Secret Service. These coins were seized because they were thought to be stolen from the US Mint.

Gold Investments

The gold prices recently touched an unprecedented level of $1,254. The trend of this price rise has however, been going for some time with the constant upward revision of support levels. The key question arising here is how stable is the trend? More generally, how safe is it to stay invested in gold?

Experts from the financial sector of the likes of George Soros are betting against quick recovery from the current delinquent state of the markets. They are of the view that it is still quite some time before it stabilizes. This is the major reason behind the flow of funds into gold in the form of bullion and other related products as gold ETFs.

A top Swiss asset manager reported that most of his rich clients were interested in wealth preservation during the crisis. This means that the bigger players will support any fall in the prices. In addition, people who wish to keep the prices in vigil would put in steps to check runaway prices for the precious metal. Summers being the holiday season for most of the financial planners and asset managers, the period is not likely to witness any increase, if not a fall. USAGold however, has reported that gold prices shot up at an average of 11.3 percent for the past 9 years. Also, the approximate growth from the fall i.e. June-July, to the end of the year has been 17.3 percent for the same period. Going by the trends, the gold prices can be expected to be a little less than $1,500 by December 2010.

Interestingly, there is a counter-view regarding the reliability of gold. Some foresee a fall in prices if a collapse similar to the one in 2008 returns to haunt the markets. The reason has been attributed to the possible requirement of liquidity covering in the event of cash-crunch. Still, the decline may not be as drastic as the other sectors.

Although the junior gold stocks and investments in other base metals were totally drowned during the 2008 collapse, these products have shown great resilience in 2009. According to an analysis by Lawrence Williams, if the market can be expected to stay anything better than going negative and gold to remain strong, the junior stocks are likely to provide the best of gains for the times to come. He insists that although the gold stocks have been reported to underperform during high times, they also proved a safer bet during the times of crisis.

Options for Gold Traders

Gold traders have been witnessing a bull market, with the global demand for gold surging 36%, or by $29.7 billion, in the first quarter of 2010, according to the World Gold Council (WGC). Demand for gold ETFs (Exchange Traded Funds) has spiked 540%. According to a WGC report, the demand for gold is expected to be bulling in 2010, backed by spiraling jewelry demand in India and China.

Gold Traders: Investment Options

There are several ways to invest in the gold market, which makes it necessary to comprehend each option and find the one that best suits one’s needs. Gold traders commonly deal in the following options:

• Gold bullion bars: Available in different weights, with varying gold and alloy compositions, gold bullion bars are the purest form of the metal. Consequently, the price of gold bullion bars tend to be very high, which as of the end of June, 2010 was around $1,242.

• Gold coins: These are minted by several countries. The US Mint gold coins, such as the gold Eagles, are the most commonly traded options. According to the WGC, 28,000 half-oz Eagles were purchased till mid-June 2010.

• Gold jewelry: The price charged by gold traders on jewelries depends on the gold content as well as the craftsmanship. Jewelry investment has become popular, with a market size of $613 million in the US alone, according to US census data - 2010.

• Gold Exchange Traded Funds (ETFs): Purchasing gold ETF is similar to investing in a regular stock. ETFs enable investors to paper trade the physical bullion. However, most ETF gold traders charge an annual account fee in addition to transaction charges. Gold ETFs have flourished since April 2010 due to the European fiscal crisis. On May 20, 2010 SPDR Gold Shares held a record of 1,200 tonnes, valued at US$46.88 billion.

Finally, gold traders can invest in the yellow metal by purchasing the stocks of a gold mining company. Gold trader invest in gold mutual funds with the intention of diversifying their risk on gold stocks. These entail investing in multiple gold or other precious metal mining companies.

Surging Gold: Coins in High Demand

After a brief lull, gold is fast regaining its popularity as the choicest investment option, especially in the trying times. The metal proved to be the best alternative to the volatile paper currency at the time of economic downturns. During the global recession of 2008, gold surged to record highs as the investors the world over began converting their cash holdings into the yellow metal. As the world economy seemed to be returning to normalcy, the commodity witnessed price correction, more significantly from December 2009 onwards. However, with the progress of the Fiscal Year 2010, the news of the Euro Zone Crisis started pouring in and acting as a major damper to the already shaky market sentiments. The fears of a second round of troubles gave a fresh boost to the gold demand in all forms, including coins.

The European sovereign debt crisis has made gold bullion particularly sought-after in Europe. The South African gold coin Krugerrand is currently enjoying higher valuation of the Canadian bullion, Gold Maple leaf. Meanwhile, the premium on the British bullion, Gold Sovereign is accelerating by the day. However, rooting to the concerns over the Euro Zone crisis, the rest of the world economy has made global investors wary of the foreign exchange rates moving against their home currencies. The sharp rise in the demand for the United States Gold Eagles is a proof of the sagging market view. The US bullion deliveries in the month of May 2010 shot up to double on a year-on-year basis. The US is also plagued by its own slow recovery and rising national debt, which has touched the unprecedented levels. The figure is estimated to be over $13 trillion!

The exact implication of the Greece-led instability is still a matter of debate, with conflicting news and opinions coming up often. Though the gold prices remain high, the uncertainty is making the investors wary of offloading their bullion inventories. However, in an interesting development, a member of the United States House of Representatives Anthony David Weiner from New York has accused Goldline Inc. of artificially promoting the demand for the American Eagles. In a statement from his office, the company is defined as “aggressive sales tactics, conservative spokespeople and rhetoric to sell over-priced gold coins to unsuspecting consumers.” It is hard to ascertain the proportion of the total coin demand so created and what comes out of the political roe over the issue. Meanwhile, the demand for BU and Mint State 20 cents is also picking up, such that much of the earlier price correction has already been covered.

Staggering Price for the 1794 Silver Dollar

The silver dollar was one of the earliest species to be issued from the United States Mint. Though, the Mint came into existence in 1792, red tape and cumbersome legal requirements deterred the official casting in precious metals until 1794. Unconfirmed accounts suggest that total 1,578 coins were struck in the year 1794. The entire lot was minted using a single pair of dies in one day, on October 15, 1794. Consequently, the strikes gradually became less prominent, resulting in the outright rejection of a large number of silver dollars. It is believed that today only 120 to 130 coins are available in acceptable net mintage. Therefore, the 1794 silver dollar is treated as a rare issue.

The Congress mandated that the design for the silver dollar was to feature ‘Liberty’ and commissioned the task to engraver Robert Scot. The obverse of the coin portrays the side view of the face of a young woman with freely flowing hair. This hairstyle is particularly symbolic of ‘freedom.’ The word ‘LIBERTY’ is engraved at the top along the circumference with fifteen stars representing the states. The lower portion contains the year of issue. The reverse side shows a bald eagle with outspread wings, encircled by laurel branches on either side. The eagle is depicted sitting on a rock and looking towards its left. The country’s name is engraved along the circumference.

The then Director of the US Mint, David Rittenhouse distributed some of the pieces as mementos to some VIPs, put some into the common circulation, while retained some of them. The uncirculated silver dollars are very few in number and are available in mint state grade, commanding very high valuations. On May 20, 2010, one such coin was sold under a private treaty sale at a stunning price of $7.85 million. This constitutes the highest value transaction in precious metal coins in the world and surpasses a previous record of $7.59 for a 1933 American Double Eagle (gold). The President of the Rare Coins Wholesalers, Steven L. Contursi sold it to Cardinal Collection Educational Foundation, California, after holding it for last seven years.

Many analysts and experts believe that this particular piece is the first silver dollar ever struck. However, concrete evidence to this effect is not available. The dollar retains its pristine shape, making it more significant than its other counterparts do. The visible file marks were created to make the metal content precise to the face value. Martin Loges of Sunnyvale Foundation, California stated, “Of all the rarities I have seen or heard of, there is no doubt in my mind that this is the single most important of all, the very first silver dollar. This is the coin that has it all.”

Greece’s Rating Downgrade and the Impact on Gold Prices

The preliminary news of a brewing economic trouble in the Euro Zone began pouring in with the start of FY 2010. The problem that began with Greece, gripped Spain and Portugal as well, jeopardizing the future of Euro, one of the best paper currency alternatives to the US Dollar. The sovereign debt of these nations reached to alarming levels, much higher than their GDPs. The next blow came as Greece requested an EU/IMF sponsored bailout package in April 2010, followed by a credit rating downgrade by Standard & Poor. The debt rating of Greece was reduced to BB+ (non-investment grade) on April 27, 2010.

The industry watchers remain divided on the exact impact of the crisis, yet everyone agrees that any sovereign credit default is likely to destabilize an already slow world economy. As the bailout package is being formulated, another leading agency, Moody’s Investor Service pegged Greece’s rating to Ba1 (junk), down four notches on June 14, 2010. While this has instigated a lot of furor with the European Union expressing a ‘surprise’ over the move, the investors and speculators seem to have taken a different beat. A key fact in the case is that the national debt of the United States has also reached at historic levels, crossing $13 trillion. As a tumbling Euro has lost much of its attraction as an alternative to a weakening Dollar, the traditional preferred commodity gold has regained its sheen.

Much on the similar lines as during the global meltdown of 2008, the investors at various levels have started switching to the yellow metal, as an effective hedge against any further destabilization in the world economy. Apart from the panic-driven consumer demand, the market for speculative positions is also heating up. There is a large section of experts, who have faith in the EU/IMF rescue package for Greece. However, an equally sizable number, including the credit rating agencies, believes that there is a strong probability of administrative issues and implementation risks inherent in the program. Last week has been a witness of the wavering market sentiments, where gold touched the record price of $1,251.20 before reaching $1,214.

Moody’s latest action reflected in the gold spot that hovered around $1,226.95 on Monday. The August delivery futures jumped approximately $5 to reach $1,299.10. ScotiaMocatta of Scotiabank Group expects that after consolidating around the current levels, gold is expected to reach new highs in the coming days. Meanwhile, another leading agency Fitch has clarified that it is not contemplating a rating downgrade for the ailing country, in the near future.

The Advancing Gold Futures

The significance of gold as a measuring standard of wealth and a viable investment option has been recognized since ancient times. Even after the dissolution of the Gold Standard worldwide, the yellow metal remains the most important asset for the various Central Banks across the globe. In such times, the demand surges in every quarter from national treasuries to retail investors. The recent global recession reestablished the authority of gold coins for hedging, investment, and even for speculative purposes.

The gold futures got a fresh impetus on June 15, 2010, amidst the growing concerns about the state of global economy. The August-delivery gold futures increased by 0.8% to reach $1,234.40 on the New York Mercantile Exchange, after hovering around $1,220 for a couple of days. Amidst concerns over the rising sovereign debt levels and weakening US Dollar, gold is increasingly seen as an effective alternative. The Dollar Index (DXY) was down by 0.7% to 85.93, while Euro ended approximately 1% higher than the Dollar. The Dollar Index measures the price of the US Dollar, relative to six major currencies of the world. The Greece-led economic crisis that came into picture in the first quarter of 2010 sent warning signals in the already ailing world economy. The impact of these events in the Euro Zone could not be assessed completely until date. As more and more grim news and analysis began pouring in, the fears of a double dip grew stronger.

The volatile situation in the European Union, in general, and the downgrading of Greece’s credit rating by Moody’s Investor Service on Tuesday, are the other major factors currently driving the gold prices. The credit rating agency slashed the ratings to non-investment grade, pointing out the inherent risks of IMF-sponsored proposed bailout packages for Greece. The Chicago-based Future Path Trading’s futures analyst, Frank Lesh stated that it is still uncertain whether the European Union is out of ‘danger’ and on the path of recovery. Nevertheless, the popular sentiments remain highly skewed in favor of gold. According to analyst Stephen Platt from Archer Financial Services in Chicago, following the past week’s price fluctuations, the commodity appears to be consolidating. Ever since the debt crisis became apparent, the commodity has become pricier by 12%. For the first time in almost four decades, since the gold futures were introduced on the New York Mercantile Exchange, the bullion touched $1,245.60.

American Eagle Gold Coins Well Know Bullion Coins

American Eagle Gold Coins are well known bullion coins. These are minted in USA and as per the rules the gold is 100% American for it to be considered legal. These were launched when South African gold was banned due to protest against apartheid.

The American Eagle Gold Coins are 22 carat gold, i.e. 91.67% pure gold. They are made in 1/10 oz, ¼ oz, ½ oz and 1 oz denominations which are also the weight of the coin i.e. its gold content. Gold has baser metal like copper and silver alloy content. They differ from Kruggerands in their yellow color, which is due to the alloy. Kruggerands are deep orange.

This coin was designed by Augustus Saint Gaudens, the world famous designer. It has the Lady of Liberty holding her torch on one side, the other has a male eagle flying above a female eagle and a baby eagle. It is rich in symbolism. The male eagle represents the power and might of USA, and the male eagle also carries an olive branch that represents USA’s commitment to peace. All of the coins bear the same design. The gold content varies as per the denomination.

Another great advantage is that American Eagle Gold Coins are recognized globally. They are, in fact, the most popular gold coins in the world. Hollywood has done its bit in making people from countries all over the world familiar with both its intrinsic value as well as its artistic value. This adds to their appeal as a collector’s item. People display pride in owning an American Eagle Gold Coin.

Moreover, U.S. Mint guarantees their gold content and their weight.

Euro Debt Risks Fuel Demand for Gold

On May 27th according to Bloomber investors bought precious metals over concerns of Europe debt crisis sending gold near a one week high. The euro declined as gold bullion rose to $1,212.25 an ounce by 8:10 a.m. in Sydney. June delivery gold is up 3% for the week ending May 28th.

On May 26th platinum rose 0.3% to $1,520.50 an ounce while palladium rose another 0.7% to $442 an ounce.

Silver also increase 0.2% to $18.10 an ounce achieving a total of 2.3% over the last three days.

Low Interest Rates May Allow Gold and Silver to Rise

With the Federal reserve most likely not changing the current fiscal policy, gold and silver prices may rise due to low interest rates allowing investors to buy precious metals as a hedge against inflation, according to Dave Rusate, GE Capital's managing director of foreign exchange and commodities.

"If the government doesn't raise interest rates, that allows hedge funds and other speculators who try to protect themselves from inflation to buy" (gold and silver), says Rusate.

For the ninth straight year gold futures have risen and are up already 11 percent this year. A new record was achieved in May 14 when gold hit $1,249.70 an ounce. Silver is also up on the year at around 25% in the last 12 months.

Rusate also states that platinum may have a nice jump in the next month as South Africa the world's largest platinum producer slows down production due to the World Cup. South Africa is the host country for the World Cup and electricity flowing to mining companies may be directed toward the event.

Transitional Gold Coins

United States gold coin production has produced several instances of two different designs being produced simultaneously, or within the same year. These are scaled transitional coins and they make for a very interesting collecting focus for the gold coin buyer.

The one dollar gold dollar denomination, the most obvious transitional issue occurred in 1854 when both the Type 1 and the Type 2 gold coin issues were produced. Both of these are relatively common although the Type 2 becomes scarce in the higher grades and rare in MS64 or better. In 1856 two designs were produced: the Type 2 and the Type 3. Since the Type 2 was only made in San Francisco during this year and there are no 1856-S Type 3 gold dollars this isn’t a transitional issue in the sense of the 1854.

There are many other transitional issues, such as the quarter eagle denomination. In 1796 2 coins were minted, one with No Stars and With Stars in the designs. Both of these are rare in all grades and because of price constraints they could be considered one more difficult coins to acquire in a transitional set. The next transitional issue occurred in 1834 when both the Capped Bust and the Classic Head quarter eagles were struck at the Philadelphia mint. The former is an extremely rare coin in all grades while the latter is common in grades up to and including MS63.

The largest group of transitional issues exist in the early half eagles. The reason for these transitional issues tends to be different than, for the 1854 Type 1 and Type 2 dollar when the design was changed to facilitate improved striking.

The twenty dollar U.S. gold coin contains more interesting transitional coins for the specialist. The first of these is the 1866-S No Motto and With Motto. The former is a very scarce coin in all grades and it remains unknown in Uncirculated. The latter is fairly common in circulated grades and scarce in Uncirculated with nearly all of the two to three dozen known in Uncirculated grading MS60 to MS61.

The termination of the Liberty Head design in 1907 meant that an interesting group of transitional coins from this year are available. The 1907 Liberty Head issues were produced at the Philadelphia, Denver and San Francisco mints and all three are common in grades up to MS63. The 1907-S is very rare.

Augustus St. Gaudens’ redesign of the double eagle was introduced in 1907. Most transitional collections would include a High Relief from this year as well as a 1907 No Motto. Both of these coins are readily available in Uncirculated grades and the No Motto is abundant even in MS65 to MS66.

Liberty Head Double Eagle: Very Fine

During 1848-52, the chance discovery of large goldmines in California led the American Government mandate the issue of its first $20 gold coins. Earlier, the highest denomination was $10 and the coins were named ‘Eagle.’ Drawing upon the logic, the $20 coins came to be known as ‘Double Eagle.’ Engraver James B. Longacre conceptualized the pioneering design for the Double Eagles ‘Liberty Head.' The Liberty Heads were released from 1849 to 1907. In the year 1849, only two proofs were molded and its mass production officially began in 1850.

The obverse design of the coins features the head of Lady Liberty, aligned sideways. Along the circumference, thirteen stars are present that seem to surround her head. The year is engraved in an arch alignment right below her head. The reverse is a more complex design portraying the bald eagle in the center with its wings spread. One of its claws holds some arrows and the other holds an olive branch. An ornate shield appears to cover most of the frontal portion of the eagle. Encircled by thirteen stars, the ‘motto’ appears (1866-1907) above its head.

From the collectors’ point of view, there are three main categories of the coin. Unlike the later two variants, the Type I (1850 through 1866) Liberty Heads did not carry the motto ‘In God We Trust.’ The Type II (1866 through 1876) had the words engraved and the denomination was mentioned as ‘Twenty D.’ The Type III (1877 through 1907) carried the motto and was primarily different from the previous two issues in that the denomination was expressed as ‘Twenty Dollars.’ Additionally, it had some design modification, like the repositioned head of Liberty and her acutely diagonal neckline.

Type III Liberty Heads were minted in the largest numbers, partially owning to its 21-year stint. Most of them went into the national treasuries of the investing countries, rather than going into mass circulation. This exported variety is a highly valued one, as is the Type 1A (1861), designed by Anthony C. Paquet. However, all the three series are available in various grades, including VF (Very Fine), from VF-20 to VF-35. These coins contain light to moderate wear & tear. The buyers should avoid the coins ‘cleaned’ for enhancing the eye appeal.

For valuation purpose, the obverse is more significant than the reverse. One must closely examine the areas behind the ears, along the cheeks, hair, and forehead on the frontal side. On the reverse, the possible spots of aberration are the eagle’s neck, the contours of its wings, and the breast feathers, apart from the upper edge of the shield. Fingerprints, handling marks, hairline cracks, and minting defects reduce the worth of the coins. Traditionally, the VF grades have traded at spot price as well as premium. Presently, they usually trade at the spot rate, adding to its appeal.

Rare Date Gold Coins

With the official opening of the first Mint in the US, in 1795, the Government began issuing gold coins for common circulation. Until President Roosevelt’s gold confiscation order of 1933, the new gold coins were produced and used in commerce. The U.S. gold coinage kept evolving and several different series were introduced during 1795-1933. Some of these came to be treated as rare for various reasons and became more significant for the numismatic purposes. As a rule, the rare date coins command higher valuation than their other counterparts do. But for the experts’ advice, it is not possible for a common investor to assess the rarity and the resulting valuation of the mintage. The key professional grading organizations are Numismatic Guaranty Corporation (NGC), Professional Coin Grading Service (PCGS), American Numismatic Association Certification Service (ANACS), and Independent Coin Graders (ICG).

The slack supply of the rare coins can be attributed to smaller production and destruction in the due course. Destruction, in turn, was the result of accidental damage, wearing due to circulation, export, or melting by the Government. The turbulent economic times like these have always provided impetus to gold as an effective hedging instrument. The same effect is translated into the rare coins market, but in a magnified form. Over the past decade, these pieces have offered much better returns than the other forms of investments, including gold bullion. The supply of such pieces has remained static since 1933, and any surge in demand puts an upward pressure on their prices.

After World War II, as an indirect implication of the Marshall Law, the European nations converted their US Dollar holdings into old gold coins. Therefore, presently, these countries hold their large reserves. As the nations, worldwide, continue to hold on to gold as an insurance against volatile currencies, the old coins are not likely to enter the markets in large numbers. Most of the Eagles and Double Eagles minted from 1929-1933, are considered rare as the mintage rate was very low in these years. Almost all of the St. Gaudens Double Eagles molded in 1933 were melted down and only eleven pieces (hoarded or stolen) have been recovered, making it among the rarest dates. The proof coins and business strikes for the ultra high relief St. Gaudens $20 of 1907 are treated as extremely rare as this variant was discontinued. Another example is Liberty Head Double Eagle Type IA (designed by Anthony C. Paquet), released only in the year 1861. The proofs for the Three-dollar piece dated prior to 1859 are extremely difficult to find. Similarly, various dates for different denominations and the year of coins are regarded rare for different reasons.

Saint Gaudens $20 Gold Coin: MS 64

In the year 1907, the then US President Theodore Roosevelt commissioned the adornment of the American coinage to his friend Augustus Saint Gaudens. The new series of coins created was named after its designer. Saint Gaudens $20 coins are known for their high aesthetic appeal. They were recognized as the best design pieces. This series was issued from 1907 through 1933. For the numismatics and investors, there are two main sub categories for Saint Gaudens – one without the motto ‘In God We Trust’ and the other with the motto. The coins minted throughout 1907 and partially in 1908, did not contain the words. As they could not gain wide public acceptance, a law was passed in 1908, mandating the engraving of the motto.

The obverse portrays a prominent figure of Lady Liberty holding the symbols of freedom and peace in her hands. Her right, outstretched hand holds the torch of freedom. The left arm is stretched sideways. It holds an olive branch in the middle. The backdrop signifies the backing of the religious ‘glory.’ The reverse features a large bald eagle flying over the image of sun, positioned at the bottom. Along the circumference on the frontal side, 46 stars (1907-1911 releases) or 48 stars (1912-1933 releases) are engraved. The number of stars corresponded with the number of federal states in the US. Mexico and Arizona were included in the year 1912. Therefore, these variants also represent two different types of the coin for the collectors.

Among the most valued Double Eagles are the ones from the rare series. During the last four years, 1929-33, much fewer coins were released, rendering them much sought-after. The eye appeal often drives the grading, demand, and value of the coins. This explains why the MCMVII mint of 1907 enjoys a very active market and is an expensive variety. Ironically, such high appeal coins are most prone to bumps, marks, and defects, all of which contribute towards lowering their value.

Various St. Gaudens are easily available in the mint state, which implies such coins never went into circulation and are present in the original condition. The mint state (MS) Double Eagles are available in grades between 60 and 70, with 70 representing the finest grade and truly flawless. MS-64 is a popular and easily accessible version that signifies no wear & tear and original mint shine. However, it may contain some bag marks, hairline, or molding defects. Its luster is original, but may be marred by some visible spotting of mellowing red copper contents. It is possible for a coin with noticeable deficiencies to slide into the lower bracket, MS-63. Nevertheless, some compensating factors like extra shine may help retain its grade.

How to Buy Rare Gold Coins

Buying gold coins requires preparation and learning. Before you buy your first coin, you should commit yourself to learning as much as you can about coins, so that you can make an informed buying decision.

This won't guarantee that you will make a profit from your investment in rare gold coins, but it will increase your chances greatly.

There are many resources available in print and online to help you educate yourself about rare gold coins.

You should start with The Guidebook of United States Coins, popularly referred to in the industry as the "Redbook." This book lists every coin ever minted by the U.S. mint which will enable you to know what's out there. It also gives brief histories and descriptions of the coins and lists their original mintages.

A couple of notes of caution are in order, however.

First of all, original mintages are not always indicative of current rarity. The key to current rarity is the number of surviving specimens believed to be around today. In some cases, issues with small original mintages have high survival rates, making them relatively less scarce today. Conversely, some issues with very high original mintages have experienced huge attrition rates, primarily due to meltings, and thus are very rare today.

Second, the Redbook lists prices which are not at all reflective of current market value. This is because the Redbook is published annually and the coin market trades actively throughout an entire year. There is simply no way for an annual guidebook to accurately indicate the current price of a rare gold coin.

We will let you in on an important fact now, before you embark on your education process (you will discover this on your own later anyway): you should only buy rare gold coins which have been graded and certified by Professional Coin Grading Service (PCGS) and Numismatic Guaranty Corporation (NGC). PCGS and NGC are the two leading independent coin grading firms whose standards have been accepted industry-wide for many years. Buying rare gold coins which have been graded by lesser services creates too much risk and should be avoided.

Just as is the case with any major purchase, you need to know what you are acquiring. Make sure that you are getting advice based upon your goals and objectives. There are many ways to acquire gold across that asset class. Therefore you need to make sure you are applying the right tool to the right job. Lower graded, higher population type coins will tend to perform more like asset protection, whereas higher graded rarer issues will tend to grow more over time.

In addition to buying the right coins for you, you should also compare coin dealers. You will want to buy coins from a dealer who is reliable and can provide you with the level of service and education that you desire. Not all dealers provide ongoing client education in the form of newsletters, special reports and periodic, complimentary portfolio updates. Before you decide to buy a rare gold coin from a coin dealer, you may wish to know what your relationship with that dealer is going to be like.

One final note in comparing dealers: you should check to see what each dealer's rating with the Better Business Bureau is before making your final buying decision.

ITM Trading offer expert advice on how to buy gold coins including rare gold coins.

The Significance of Gold Price Forecasting

The recent global turmoil has reaffirmed the significance of gold as a safe and viable investment alternative. Other precious metals like platinum have not been able to take the position of gold, due to its high value and price volatility. In addition to retail investors, central banks, institutions, pension funds, etc. also take large positions in gold and drive its prices.

Why gold?
The one most apparent factor is that the lifetime returns on gold have been positive. Gold value is subject to short and medium-term fluctuations. However, it is not susceptible to the ups and downs of the economic and business cycles. This renders it a more stable investment in the long-term.

There is a negative correlation between the dollar rates and the gold prices. In the case of volatile market conditions or a weakening currency, people start replacing their dollar investments with gold. On one hand, this ensures that the investors do not lose their purchasing power by the day. On the other hand, the increased demand for gold pushes its prices up, augmenting the values of gold holdings. A weakening dollar is indicative of strengthening gold and vice-versa (this is mostly true, but not always).

Gold prices are not dependent upon the political or economic conditions. Events, like natural calamities, political disturbance, wartime etc. either do not affect gold value, or put an upward pressure on it. Therefore, in distress conditions gold acts as an effective hedging strategy to prevent the erosion in investor wealth.

Is gold always a ‘buy’?
Like stocks, investors often make a mistake of buying gold at a peak on the expectations of further price rise. Speculative gold trading has a large market and often the speculators accelerate the uptrend through futures and forwards. Such artificial price rally is liable to correction, sometimes leading to sudden plunge in value. Always remember the thumb rule to buy low and sell high.

Is jewelry worth the same as coin, bullion, or bars?
Jewelry yields lesser returns that the other forms due to the mixture of alloys, wear & tear, handling marks, and designing. In addition, gold jewelry is a costly acquisition because of its processing charges.

How to ensure right decisions?
Acquiring gold calls for more than intuition and tracking the mass sentiments. Guidance from expert precious metals consultants, newspapers, trade journals, investment websites, authentic investing forums, etc. are some of the reference points for making informed decisions.

Commodity Trading: Gold and Silver

Since ancient times, precious metals have been the articles of ornamentation and monetary worth, alike. In the modern world, these metals find wide scale uses in jewelry-making, industrial use, investments, and speculation. Gold and silver are the most popular precious metals with universal acceptance. Their affordable prices, structural stability, ease of handling, liquidity, high returns on investments, and global acceptability, make them attractive trading propositions. The investment options in gold and silver include the stocks of mining companies, physical metal holdings, ETFs, and certificates. The current fiscal 2010 is expected to be a fruitful year from the point of view of gold and silver investing.

The US subprime crisis-led global recession destabilized the national economies and paper currencies worldwide. Some of the direct consequences of economic disequilibrium are the fluctuating forex rates accompanied by inflationary/deflationary conditions. This leads to volatile currencies and erosion in monetary holdings. Gold and silver are relatively insulated from such factors as their international prices are fixed daily based on demand and supply. When the currency value goes unpredictable, the investors start looking for alternatives and take exposure in gold investments.

Globally, sovereign gold holdings are important appeal drivers for gold. Traditionally, various nations maintained US Dollar reserves. Due to the consistent devaluation of Dollar over the last few years however, the central banks worldwide switched their sizable holdings to gold investments, pushing the already high demand even higher. As the demand rises, the prices follow, enhancing the worth of gold holdings further. Last December, the gold prices crossed $1,200 per ounce.

In the current scenario, the rationale for gold holdings is that the upside potential on the demand side remains high. Not only the retail investors, but also the fastest growing economies in the world, the BRIC (Brazil, Russia, India, and China) are planning to hedge their positions more aggressively than before. As far as the prices are concerned, the markets have already factored in a correction of almost 10% since December 2009. On the supply side, the position is weakening. The supply has slackened over the years. It is expected to level-off or even plunge in the coming years. Although, some newer reserves have come into light in certain underdeveloped nations, the cost of exploration remains a deterrent. The recycled gold supplies and new search ventures may not be able to keep up with the ever-growing demand in a couple of years. Therefore, the medium to long-term potential of gold is high.

The growing industrial demand will keep driving the prices of silver in future. Silver finds great use in electrical and electronics industry. In the retail segment, silver is used in manufacturing ornaments, decorative articles, foils, coins, bars, and bullion, to name some. The supply of silver is also limited and the demand is rising. With the economic recovery and increased manufacturing activity, the demand for silver is forecasted to rise.

Who Buys Gold Coins?

The Investor

There was a time when the only people who bought gold coins were the so-called “gold bugs.” These people were considered eccentric for buying gold coins back in the 1970s after gold ownership was legalized in the United States of America.

But by the time the 1970s were over, the gold bugs were proven to be pretty darn savvy for having the foresight to protect their wealth with gold coins. In fact, by the time 1980 debuted, the South African Krugerrand gold coin was one of the most popular investments in the world. It wasn’t just gold bugs buying anymore. Investors of all philosophies realized the value of including gold in their diversified portfolios.

Whether someone was looking for aggressive growth or preservation of capital, gold had a role to play because it could both produce profits and protect wealth from high inflation and crisis. So, basically, all sorts of people were buying gold in the period from 1975-1981.

In 1980, gold peaked at $850 per ounce and demand for gold coins also peaked. While many continued to buy gold in the 1980s, especially in 1987 in the wake of a huge stock market crash in America, overall demand for gold waned over the course of the decade and into the 1990s. This was because the price of gold stayed range-bound for extended periods of time.

Once again, gold coins became less popular among investors. In fact, at one point in the 1990s, according to a Wall Street study, American investors, on average, were negatively invested in gold, reflecting the fact that more money was placed on the short side of futures contracts than was on the long side.

In a sense, the few who were buying gold coins during this period were new gold bugs, once again thought of by the rest of the financial world as eccentric.

All of that changed in the 21st century. The first decade of the 21st century proved to be the polar opposite of the 1990s. Periodic crises of both the geopolitical and economic variety rocked paper assets and brought gold back to the forefront of peoples’ minds. The price of gold soared, smashing the $1,000 mark for the first time.

The combination of failing banks, collapsing real estate values, volatility in the financial markets as well as terrorism and war prompted investors of all types to turn to gold coins once again. And their gold has served them admirably.

Today, once again, savvy investors of all philosophies are realizing the wisdom of including gold in their diversified financial planning. Some who were day trading through online discount brokers in the stock market bubble years of the 1990s are now holding gold. But so are families and retirees who just want safety and security. In short, just about every type of investor is buying gold today.

The Collector

In parallel to investors buying gold coins, collectors have been buying gold coins all along since the legalization of gold ownership in 1974.

Unlike investors, collectors buy coins strictly for their beauty and historical significance, without any initial profit motive. To these collectors, gold coins are works of art and historic artifacts from history. The number of coin collectors in America has been growing steadily for decades. Of course, only the most affluent collectors can afford to buy gold coins strictly for pleasure.

This raises an important point.

While collectors may not acquire their coins for profit, the fact of the matter remains that collections of gold coins have historically brought handsome profits for their owners and their heirs. In fact, statistically speaking, the most successful recorded performances tend to be made by collectors, rather than investors. This is because collectors know which coins to buy and buy them according to a plan.

This suggests that investors should seek the assistance of expert collectors in choosing coins.

Where Can I Buy Gold Coins?

When it comes to buying gold coins, today’s investors and collectors have more choices than ever in terms of where they can obtain coins.

An Historical Perspective on Buying Gold Coins

Today, there are two broad varieties of gold coins from which to choose: rare gold coins, such as the Saint-Gaudens Double Eagle (minted from 1907 to 1933) and gold bullion coins, such as the American Eagle gold bullion coin.

But from 1933 to 1975, there were no gold bullion coins, such as the Gold American Eagle, because, believe it or not, it was illegal for United States citizens or foreign residents in the U.S.A. to own gold. During that period, the only gold coins that were permitted for private ownership, and thus eligible for sale, were “gold coins of special interest and value to collectors”—in other words, rare gold coins.

Even so, during most of the period 1933 through the end of Second World War in 1945, few Americans could afford to buy and own rare gold coins. Rare gold coins were a luxury that just could not be justified during the decade of the Great Depression and the four years of World War II from 1941 to 1945.

The few Americans who could afford to buy rare gold coins during the period from 1933 to 1945 were usually the very wealthy and they obtained their gold coins from a few elite, specialized coin dealers (called “numismatists”). These dealers were often unknown to the general public and traveled in strictly upper class socioeconomic circles. It is no wonder that coin collecting got the label “the hobby of kings.”

After the Second World War, America was transformed. It’s economy was transformed by the rapid industrialization and modernization which had occurred to support the arsenal of democracy and America’s society and culture was transformed by the millions of returning servicemen who had made the world safe for democracy, had been to places that no one in America had even heard of before the war and who wanted to start families and live the good life back at home.

This transformation also had an impact on the coin business. In the post-World War II period, more prosperity meant that more people could afford rare gold coins. To be sure, rare gold coins were still not items that the average American could afford to collect, but, nevertheless, more Americans could afford them than ever.

Inevitably, more buyers of rare gold coins meant more dealers of rare gold coins and these new dealers were not always the elite, wealthy individuals that had sole control of the trade back in the 1930s and 1940s.

The post-World War II years saw the establishment of coin shops across America. Not all coin shops could afford to maintain inventories of rare gold coins, but some could and such retail outlets became a viable option for finding at least some lower-end rare gold coins.

Coin shops really boomed in the 1960s and it was not uncommon to find some rare gold coins in just about every shop.

The Legalization of Gold and the Introduction of the Krugerrand

The coin market became even more transformed after 1975, when the law that made it illegal for private collectors and investors in the United States to own gold was suspended.

This was followed by a whole new phenomenon: South Africa’s Krugerrand.

In the late 1970s, the world’s largest gold producing nation, the Republic of South Africa, introduced a new gold coin: the Krugerrand (named for one of the country’s early leaders).

Unlike rare gold coins such as the Saint-Gaudens Double Eagle, the Krugerrand was mass produced on modern, high-speed machinery and was never meant to be rare. Therefore, its value was strictly tied to the one ounce of gold it contained.

A brand new investment category was thus born: gold bullion coins.

Buying Rare Gold Coins and Gold Bullion Coins Today

Today, investors and collectors have several choices when it comes to buying gold coins:

• Coin Dealers
• Coin shows
• Local Coin Shops
• Banks (Usually banks only sell bullion coins.)
• Brokerage houses (Like banks, brokerage houses customarily only sell bullion coins.)