Tuesday, August 17, 2010

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.

Friday, August 6, 2010

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.

Thursday, August 5, 2010

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.

Wednesday, June 30, 2010

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.