The Mint will raise the price of its silver American Eagle bullion coins on Feb. 9. Authorized purchasers are able to acquire the coins for the cost of an ounce of silver plus $1.40 per coin presently. The premium will rise to $1.50.

I imagine the Mint will be criticized, but it shouldn’t be. Any other business that had a hot product that trades for a price so much higher on the secondary market than on the primary market would be aggressively raising prices. The $1.50 would be more like $2 or $2.25.

That would not be popular among the online pundit class, but it is how business works.

Instead, we continue to see shortages of these coins on the market and a rationing system in place to apportion coins to the current buyers.

Bullion investment advisors point to this shortage of American Eagles and other bullion coins worldwide as a indicator that the price of the underlying ounce of silver itself should be far higher.

This has a ring of plausibility to it, and sounds better than the reality of a production bottleneck at blank producers. (The Mint does not produce its own blanks.)

When demand for physical coins rises so far beyond ordinary demand from prior years, it is not surprising that the physical plant and equipment necessary to fabricate blanks can’t meet demand.

Businesses don’t spend large sums of money to keep large amounts of idle plants and equipment online just in case there is an unexpected surge in demand. That’s a quick way to bankruptcy. An even quicker way to bankruptcy is to read the present unusual demand for blanks as a sign that huge new investments need to be made in production facilities to meet it.

Once that is done and demand is satisfied and then falls, the owners of the new equipment would be stuck.

This unfortunate cycle has always been a problem in things like the aluminum industry, the steel industry and iron ore mining. In good times, demand and prices soar. In bad times they both fall off a cliff.

The spectacular run up and then fall in oil prices from $147 a barrel last July is another example of demand rising and falling faster than the underlying infrastructure can adjust.

What’s the Mint to do? Since it can’t take the money and run like a private business, it is pretty much stuck with what it is currently doing.

I can tell that we are in an economic downturn simply by the tone of e-mail communications to me. It gets harsher.

One person wrote me two e-mails in the span of two days. The first was to complain about the winner of the Coin of the Year Contest announced last week. She wanted to buy the 2007 Mongolian 500 tugrik but didn’t know where to buy it.

The second e-mail arrived when the Mint announced online its weekly repricing of the Ultra High Relief Saint-Gaudens $20. She jumped to the conclusion that the order that she had already placed would be repriced higher, costing her more. I assured her that that would not be the case, but she replied in a third e-mail that she didn’t really trust the Mint to do the right thing.

Another writer complained to me that he somehow didn’t see news in Numismatic News of the availability of the Ultra High Relief when it went on sale Jan. 22, but had nevertheless bought one in the first days of availability, so even though he was able to buy one, he wrote he felt that I had let him down.

I can understand the stresses collectors face. To the extent that I save the family dog from being kicked, feel free to vent in e-mails to me.

The Mint’s Web site slowed down and its 800 number backed up yesterday when sales of the Ultra High Relief Saint-Gaudens began at noon.

Fellow staff member Bob Van Ryzin, editor of Coins Magazine and our resident expert on the work of Augustus Saint-Gaudens, was one of those caught up in his effort to buy his one-per-household limit.

That order limitation had a least one dealer offering to pay people to buy coins. The price, I believe was $110 per order.

Grading services have issued their submission rules for the new coins. The race to be the first on the block to own an MS-70 version is on, or will they call it Proof-70?. Obviously some people think it is a race worth running.

I have already had an e-mail from a successful buyer who complained about the elaborate packaging. He figured the coin could have been sold for $50 less if it were simply put in a plastic capsule.

Whether his box costs $50 or not, it sounds like the opinion of someone who is going to submit the coin to a grading service.

Possible delays in delivery of up to nine months can give the coin an aura of scarcity. However, the Mint could strike up to 300,000 of the coins when all is said and done and that would make it quite common. Will the beauty factor overrule the high possible mintage factor in collector decisions?

The 27mm coin, which is $10 size is more than 50 percent thicker than the pre-1934 $10s because it contains one troy ounce of .9999 fine gold.

Perhaps it is just the “how quick can I get it slabbed" factor.

Today the U.S. Mint will begin selling the 2009 Ultra-High-Relief gold $20 to collectors at a price of $1,189.

As Coins Magazine editor Bob Van Ryzin remarked in a meeting this week, he is surprised it is so low. With gold at roughly $850 a troy ounce, collectors are paying an additional $339 for the incredible Saint-Gaudens artwork.

That’s less than a 50 percent markup, roughly 40 percent, to be more precise. In the world coin market, the rule of thumb is any gold collector coin is at least double the value of the gold in it.

Of course, collectors are not in the habit of thanking the Mint for its prices. For collectors, we have a habit that if something isn’t free, we want a discount of at least 10 percent, more if we can negotiate it.

Some early buyers will get the coins rapidly, but because of the ongoing shortage of gold coin blanks, the Mint warns that some buyers might wait as long as nine months for delivery. There is a limit of one coin per household to spread the supply around.

Potential delivery delays are unfortunate, but they are a by-products of the incredible worldwide demand for gold bullion coins. This has put pressure on the world’s blank producers that the U.S. Mint and other mints depend on.

The Ultra-High-Relief will demonstrate the commitment that Augustus Saint-Gaudens and his patron, President Theodore Roosevelt, had to improve the look of U.S. coinage and bring it more in line with the standards of the ancient Greeks.

Unfortunately, that plan was spoiled by the needs of bankers and commerce generally to have coins that are stackable.

So, the coin that wasn’t produced in 1907 will be available later today at the Mint's Web site, www.usmint.gov.

Will you be a buyer?

The Industry Council for Tangible Assets has formed a committee to recommend candidates for U.S. Mint director to the Obama administration.

My first reaction was huh?

ICTA is a numismatic lobbying organization formed to defend collectors and businessmen from unfair taxes such as state sales taxes on coin and bullion transactions and to win collectors who own coins tax treatment that is identical to the long-term capital gains tax treatment that they get on other investments when the time comes to sell.

ICTA educates dealers about how to comply with all cash transaction reporting requirements to prevent them being entrapped in money laundering.

These are good and necessary undertakings.

ICTA has existed on a shoestring budget since its founding in the early 1980s. Nevertheless, it has won some notable victories in state capitals. There have been some defeats as well, but it is all part of the job.

I believe the organization generally serves a useful purpose in areas most hobbyists view as necessary.

Formation of this committee crosses the line.

Now ICTA is engaging in politics. The Mint director’s job goes to a supporter of the President. When a new President arrives, so does a new Mint director.

The Mint has nothing to do with state sales taxes. It has nothing to do with federal tax policy. It has nothing to do with cash reporting enforcement.

In short, it has nothing to do with ICTA’s historic purpose.

This committee is a loser. It will irritate potential donors who might not agree with its recommendations. ICTA needs all the donors it can get.

With such limited means, ICTA needs to stick to its mission. Picking a Mint director is not part of it.

Today is inauguration day for President Barack Obama. This event and its predecessors always  remind me of the 1961 inauguration of President John F. Kennedy. This isn’t due to any similarity or or any parallel. It is simply because the 1961 event is the first one of which I have any memory at all.

I don’t remember watching the event, but even at my advanced age of five and a half, I could not help but hear the “Ask not what your country can do for you. Ask what you can do for your country” line that Kennedy spoke. I suppose I  heard this on the radio or saw this on an evening news show when watched by my parents. I don’t really remember that part of it. But the famous line reverberates in my mind. It probably helps that the clip was repeated many times through the years.

Will there be an equally famous line today that we will all remember? We will see.

Numismatically, the Kennedy administration was full of change. It became legal to own Gold Certificates again. We lost Silver Certificates to Federal Reserve Notes.

The handwriting was on the wall for silver in coinage as the Treasury directed price of the metal crept ever closer to the point at which it would exceed face value. It hit $1.2929 in September of 1963, which is the point where the silver in the silver dollar is worth $1.

This development set off the great adventure and chain of events we are still on today. Collectors lament the loss of silver in coins, which occurred under the terms of the Coinage Act of 1965.

The rosey glow of memory makes for silly claims. I have even gotten a letter saying that silver wore better than the clad coinage. That isn’t true, but in the misty idealized past, it should have been.

Where will this attachment to precious metals take us next?

Where are the new Lincoln cents collectors are beginning to ask. It is a natural question. It will be a big year for the denomination. There will be four designs.

The 200th anniversary of Lincoln’s birth arrives on Feb. 12.

Also, collectors are used to finding new cents in their pocket change rather rapidly as a new year begins.

Numismatic News readers usually begin reporting receipt of new cents right about this time. It all depends on the economy. The slower the times, the slower the release of the new dates.

In some years the economy was growing so rapidly and the banking system demand for cents was so high that they were even available at the Florida United Numismatists convention when it was held on the first weekend of January.

This year the FUN convention was held the second weekend of the year and we have just passed the third weekend on the calendar yet I have heard nothing from either readers or the Mint.

So keep your eyes pealed and post a message here, or send me an e-mail at david.harper@fwmedia.com when you find your first 2009-dated coin, cent or otherwise.