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 Wednesday, June 30, 2010
Hot Springs quarter not a hot prospect
Posted by Dave
Have you found a Hot Springs, Ark., America the Beautiful quarter yet?
I have not.
Some Numismatic News readers have reported the new quarter in their change.
It usually takes a while for new designs to work their way to Iola, Wis., so I ordinarily would not be thinking about this yet, but my publisher, Scott Tappa, put the word out to all staff members this past week that he would like to see one and inquired if any one of us had one.
He had no luck.
As evidence of what is circulating around here in the past week I can report that I got two shiny new Guam quarters in one transaction at a large chain store in a nearby city. All the other coins were state quarters or the older eagle-reverse design.
Guam was the third design of six issues from last year’s District of Columbia and U.S. Territories offerings.
If the Guam quarters are any indication of the future, I am not likely to see a Hot Springs coin in anything other than a Mint-produced set before we celebrate the July 4th holiday in 2011.
Sorry, Scott.
Wednesday, June 30, 2010 2:02:22 PM (GMT Daylight Time, UTC+01:00) 
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Tuesday, June 29, 2010
Being talked about is great
Posted by Dave
It is good that my blog is being read by some people who are prominent in numismatics. I appreciate it.
I had an e-mail waiting for me this morning from Donald Scarinci of the Citizens Coinage Advisory Committee and he sent a tweet last night during the meeting of this body that was being held in Colorado Springs, Colo., during the American Numismatic Association Summer Seminar.
His tweet: I just corrected Dave Harper’s blog comment that suggests that the CFA and the CCAC blame Congress for proliferation causing quality issues.”
I thank him for thinking that my blog comments of last Friday need correcting.
I don’t think they do. I stand by them.
At root is the basic question: what is the difference between a blog and a news story?
There is a big difference.
My blog is my blog. I do not claim that what I post here is a news story, though certainly having news in the blog is a good thing.
A blog is my opinion about news.
His e-mail asked this:
“Wherever did you get this from:
“‘They would rather point the finger at Congress, current legal statutes and Mint processes.’"
He then continued:
“Both the CFA and the CCAC are blaming the Mint processes for the lack of excellence in coin design. We are not blaming Congress or any statutes. The fault is with the Mint and if we, the CFA, are unable to do anything to help solve the problem, then we too are part of the problem. Gary Marks said that in his remarks tonight.
“We had a productive meeting tonight. For the first time since it was created by Congress, the CCAC formed a subcommittee to propose a process to create excellence in coin design. It was a historic meeting. Take a look at my tweets when you get a chance.
“I mentioned your blog at the meeting, tweeted my comment, and made it very clear that the CCAC is not blaming Congress.
“It’s good to have this dialog and it certainly helps generate interest and attention to coin designs. :) It’s a good thing.”
He signed it, “Donald.”
It wasn't a particularly long e-mail, but it seems longer here.
I support Donald’s goal of improving the artistic quality of American coins. I think most collectors do.
The only way he can do so is to attack the Mint processes, because as I wrote, Congress cannot be challenged and the statutes will not change.
It is absolutely necessary to understand that background. If you don’t, the current CCAC effort makes no sense.
If dissatisfaction with coin designs had not been chronic in those bodies for many years, prompting many a cry of frustration of having to do what Congress wants and working with all of the legally mandated inscriptions by members, you would then think the sole motivation for the effort last night simply was a bad batch of designs shown at the May meetings.
That certainly isn’t the case.
How do you communicate all of this in a blog sentence or two?
I think I did that last Friday with what I wrote.
The fact that this blog post is already very long is a perfect demonstration of the necessity of distilling issues to their barest essence in an ordinary blog post.
Tomorrow, I promise to be brief.
Tuesday, June 29, 2010 2:58:16 PM (GMT Daylight Time, UTC+01:00)
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Monday, June 28, 2010
Keep us on our toes
Posted by Dave
Know the exercise where you repeatedly stand on your tiptoes?
I thought of that this morning as I find that access to the Internet is down
and I have a couple of e-mails asking why an e-newsletter story on Friday
mentioned Morgan dollars in the headline but the image with it was a Peace
dollar.
There is nothing I can do about the Internet. When you read this blog you
will know that somehow or other the problem was corrected. That's a step
forward.
As for the other question, I have more control.
How do you say "oops" gracefully?
Somewhere along the production route for the e-newsletter what was intended to be a Morgan dollar image turned into a Peace dollar image.
I know the process of transformation isn't magic, so it becomes a matter of
trying to figure out how it happened.
This process is something like doing those exercises yet again of standing
on tiptoes to get those muscles working properly.
Up, down.
Up, down.
Up, down.
You get the idea. It isn't pretty, but it is what is needed to continue to
achieve proper outcomes.
Fortunately, readers care enough about the e-newsletter to want to keep me
and everyone else here in Iola on our toes.
Up, down.
Up, down.
Up, down.
I can feel those muscles toning already.
Monday, June 28, 2010 5:23:18 PM (GMT Daylight Time, UTC+01:00)
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Friday, June 25, 2010
Let's fight over great art
Posted by Dave
What’s the best way to improve coin designs? That is a logical question to ask in the wake of news that the Commission of Fine Arts and members of the Citizens Coinage Advisory Committee are dissatisfied with what they are seeing.
Both CFA and CCAC take great pains to point out that they have no quarrel with the artists themselves.
They would rather point the finger at Congress, current legal statutes and Mint processes.
That might prove satisfying psychologically, but can it lead to anything productive?
Is Congress likely to stop approving coins for pet causes or mandating detailed instructions for what a coin should look like?
Not likely.
The national legislature is going to determine what is and what is not worthy of commemoration. That is fixed.
Legal statutes mandate that “In God We Trust,” “Liberty” and “E Pluribus Unum” appear on coins as well as the date.
A collector inspired experiment with the placement of these mottoes on the edge of the Presidential dollar to allow artists greater design freedom on obverse and reverse caused a political backlash that Congress won’t soon forget.
It proved when it came to “In God We Trust,” the American public of 2007 is no different than the American public of 1907.
And even had there been no backlash, are the Presidential designs of 2007 and 2008 any better art than state quarters or their Sacagawea dollar predecessor?
What about Mint processes?
Imagine trying to keep everyone happy in Congress, in the Treasury, the CFA, the CCAC, the minting facilities and the collector community?
This is not an easy task, especially since being a public servant means that unreasonable objections to things seem to get as much or even more weight than reasonable objections.
At the end of the day, little will change. The tug-of-war among all of the interested parties will continue.
The miracle will be as it always has been that collectors will look at the designs of the last 10 years from a perspective of 50 years in the future and will declare a few of these modern designs to be great art.
It won’t matter that those of us today can’t agree on any of it.
President Theodore Roosevelt didn’t get many thank-you notes for taking “In God We Trust” off the redesigned gold coins, but it was his intervention that caused posterity to recognize his contribution to the creation of great art by Augustus Saint-Gaudens.
Friday, June 25, 2010 2:15:45 PM (GMT Daylight Time, UTC+01:00)
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Thursday, June 24, 2010
Hot or cold? You tell me.
Posted by Dave
Is the rate of sales of the new proof 2010 Buffalo gold coins a signal that the market is hot or cold?
You be the judge.
Through June 20, the U.S. Mint reports that 19,519 have been sold since sales began June 3.
This compares to 19,468 sold in the first three days when the 2009 proofs went on the market last October.
However, last year’s sales rate slowed down and it took a full five months to vend 49,388 of the proof 2009 coins.
Will sales of the 2010 proofs reach a similar level five months after the June 3 opening date, or is the present pace indicative of a lesser level of demand?
What do you think?
Before you give your answer, remember that last year’s offering commenced at the height of the collecting season while June is traditionally a part of the period of time that often is called the summer business doldrums.
Collectors are not machines. They do like to get away for a vacation now and then.
But when they come back, will those who have not yet purchased a proof 2010 gold Buffalo make up for lost time and buy one?
There.
Now, you can respond.
Thursday, June 24, 2010 2:11:50 PM (GMT Daylight Time, UTC+01:00)
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Wednesday, June 23, 2010
An ounce of advantage
Posted by Dave
Back in the 1970s, the Krugerrand grabbed the attention of gold buyers by claiming it was the best way to own gold.
Buyers leaped at the chance to buy a coin that was a convenient one troy ounce in gold weight. Whatever the headline price of gold is, that’s the metallic value of the coin, because market prices are quoted in troy ounces.
This convenience was and still is critical to the success of bullion coins.
That’s why the size it was copied by other major world mints, such as the Royal Canadian Mint, U.S. Mint and Austrian Mint. They all created their own one-ounce bullion coins.
For many years, my firm has provided gold and silver value charts to list the value of the metal content of various coins that are not even troy weights at various prices of bullion.
This isn’t quite as handy as buying one-ounce coins, but it is not bad.
The importance of convenience recently was emphasized in my own mind when a middle-aged fellow approached me at the Numismatists of Wisconsin show held in May in Iola.
He wanted to load his computer with value information for standard U.S. silver coins struck before 1965.
I told him the easiest way was to figure that $1 face value in these dimes, quarters or half dollars equaled a silver content of 0.715 troy ounces (coins are a tad heavier when coming off the press, but for many years coin dealers have used this figure to account for the average wear on the coins).
You take this number and multiply it by the day’s silver price.
For example, silver as I write this is $18.87 per ounce. Multiply that figure by .715 and you get $13.49 in silver value for $1 face value of these coins.
Well, what would it be for the half dollar, he asked?
I said it would be half the amount.
He looked blank.
Well, what would it be for the dime?
I replied it would be a tenth of the amount.
He looked blank.
Well, what’s the quarter?
I said it would be a quarter of the amount.
He looked blank.
He had a pad of paper and a pen in his hand and he had started writing as the conversation commenced, but he just could not pick up on the math.
One-ounce coins?
You’d better believe they have the advantage in the market.
Wednesday, June 23, 2010 2:33:07 PM (GMT Daylight Time, UTC+01:00)
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Tuesday, June 22, 2010
Prices
Posted by Dave
Prices are the mother's milk of numismatics. Most collectors faithfully follow the values of their holdings and the coins they hope to buy. They scour price guides such as Coin Market and helpfully point out typos to me when a decimal place is accidentally moved and the like, or when one price guide seems to be significantly different from another on one coin or another.
With so much focus on prices, it has always been a wonder to me that some buyers seem to willfully ignore all of the data and experience out there.
The traditional ignorer of the wisdom of pricing is the buyer who thinks he is getting a deal when he pays half or less of catalog value. Usually these bargains turn out to be overgraded or doctored coins and their values are usually less than what was actually paid. The old line about there being no Santa Claus in numismatics is true.
The other ignorer of pricing information seems to be the excited gold buyer who didn't know he wanted ever to own gold last week, last month or last year but the headlines about record prices finally got his attention. He has no more knowledge of the market than what has been published in the price guides of the last week or two.
It seems to me that this is the kind of buyer who is paying $2,135 for the proof one-ounce gold American Eagles listed on the first page of our monthly Coin Market price guide. That works out to a premium of nearly 75 percent over bullion value. There is nothing inherently wrong with paying a premium over bullion for a scarce coin, but when these prices are being paid for coins that in less exciting times were selling essentially for the price of the metal in them, it is likely that the buyers are going to be seriously disappointed when the premiums over bullion value return to normal levels.
That day will come and then I will be contacted by people who will be upset to learn that they overpaid to get into the market. They will point to today's price guide price, which they checked. I will respond that the price guide price was an accurate reflection of the market when the information was compiled. The guides don't control what is paid, they only report current activity. Right now buyers are paying those high premiums for what had previously been considered common proof gold coins.
It is hard to make money even on a good potential investment when the entry price point is already way too high. Even when the price guides report a value, it also helps to check the past and see if there is any historical reason why premiums should be so high.
Over the long run, historical pricing relationships matter as much as current prices in any buying decision and longtime collectors know this.
Tuesday, June 22, 2010 2:24:49 PM (GMT Daylight Time, UTC+01:00)
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Monday, June 21, 2010
Telephone messages start day
Posted by Dave
I have been out the office and am just now returned. It is at these moments that I am grateful for voicemail.
When I am away, I always make sure the message includes the option of contacting the operator to find someone else to help.
There were a number of satisfying clicks – no message left – as I went through the list of nine messages. I assume these individuals obtained help elsewhere, at least I hope so.
Of the five callers who did indeed leave a message there was one person who said he was mailing in his subscription check to me personally.
It is fortunate most people do not do this. If everyone sent their subscriptions to me, I would have no time for anything else.
A second caller also had a question about his subscription, and left a message for me to call him back. I will make sure the subscription department responds.
From the third caller came a tidbit of useful information about a future award recipient. I can say no more about it here.
A fourth caller was one of my regular columnists. We will converse today.
The fifth caller who left a message said he had found a 1903 Indian Head cent and wanted me to call him to inform him about prices.
When I telephone him I will also tell him about the many fine price guides that my firm publishes.
Ah, its Monday.
I think I need more coffee.
Monday, June 21, 2010 2:08:53 PM (GMT Daylight Time, UTC+01:00)
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Friday, June 18, 2010
Swim against the tide
Posted by Dave
To be a collector is to swim against the tide.
We are not a majority and never will be.
Because I work in Iola, Wis., I also swim against the summer tide here as well.
The highways in Wisconsin are clogged on Fridays with traffic heading north from Chicago and Milwaukee. They come for the beautiful summer weather and to enjoy our lakes and other natural resources.
Since I already live in a small town of 1,300 in northern Wisconsin. I am where the traffic is going already, so I find that on weekends I occasionally head in the other direction and spend time in other places.
This may not seem particularly noteworthy, but it is Friday, it is summer in Wisconsin and this is where my mind wanders.
Ah, summer.
If you have never experienced a Wisconsin winter, you cannot fully appreciate how the summer affects our minds.
Friday, June 18, 2010 3:40:57 PM (GMT Daylight Time, UTC+01:00)
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Thursday, June 17, 2010
Do you collect Native American dollar?
Posted by Dave
The Sacagawea dollar made a big splash in 2000 when it was first introduced. More than one billion were struck.
However, Americans being Americans, stuck to their habits and decided that the paper dollar was much easier to use.
Use of the $1 coin, new as it was, golden in color as it was, just didn’t cut it.
It then pretty much went to sleep as the object of interest among a few collectors.
Mintages plunged.
If you haven’t paid much attention to the Native American dollar since its beginning, you might be surprised to see that the reverse design now changes annually. Perhaps it is time for another look.
The new artwork on the reverse is very interesting. It is no longer a fairly traditional eagle. It is artwork based on Native American culture.
Now, each year the coin is a new type, so even type set collectors have to acquire an example.
Mintages have come back amazingly strongly. So far there are 73,640,000 struck this year alone.
Compare that to the early 2000s when just 2 million to 4 million were being struck at Denver and Philadelphia.
This change has to be attributed to collectors because we sure aren’t seeing the general public demanding to use the new coins.
That change in collector demand is remarkable.
Do you collect the Native American dollar coins?
Thursday, June 17, 2010 3:39:10 PM (GMT Daylight Time, UTC+01:00)
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Wednesday, June 16, 2010
Thumbs up or down?
Posted by Dave
Some days I wonder if I can be too crabby.
I received an e-mail at my e-mail address that read as follows:
“Mr. Krause,
“In your June 8 NN ‘Coin Market at a glance’, you twice used the phrase economic ‘repression’. I’m sure you meant to use the correct term – ‘recession’.
“Let me point out tho’, that the U.S. economy started growing in late spring /summer of 2009 after falling 6% in the last six months of the GW Bush presidency. The U.S. economy certainly isn’t growing as fast as is needed to get the millions of unemployed back to work, but it is incorrect and misleading to say that we are in a ‘recession’.
“But then, you didn’t say we are in ‘recession’, did you ?
“Were you being ‘cute’, or just sloppy in your writing?”
My reply?
“Dear Sir:
“Mr. Krause has been retired for 20 years, so you will have to settle for an answer from me.
“Harry Miller meant repression when he wrote repression. It is the theory that big banks are manipulating prices lower in the bullion markets. Whether it is true or not is the question.
“Had he used the term recession as it relates to the economy, it would still be correct. The National Bureau of Economic Research is the official arbiter of recessions and they have not yet declared this one over. Until they do, we are officially in a recession.
“Harry Miller was not being either cute or sloppy.
“Thank you for your interest.
“Sincerely.”
That’s the reply. What do you think?
I needn’t have worried, though.
He came back with a retort that included, “Coin collecting is fun and I love it, but the cynicism and ‘alternative’ world view of many of its enthusiasts sometimes makes me scratch my head.”
Wednesday, June 16, 2010 5:59:37 PM (GMT Daylight Time, UTC+01:00)
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Tuesday, June 15, 2010
First Spouse bottom found?
Posted by Dave
I have written from time to time about the declining mintage figures of each successive issue of First Spouse gold coins.
The excitement of three consecutive rapid sellouts that started the program was replaced by a sense of boredom.
Without that motivation of being able to buy a new issue for a quick sale at a higher price on eBay, many buyers simply vanished, reducing the core demand to tried and true collectors.
How tried those true collectors are could be seen in combined sales totals dropping from 40,000 to hardly more than 6,000.
But look. Abigail Fillmore might just mark the turning point. Sales of 2,228 uncirculateds and 4,211 proofs total a combined 6,439. This is higher than the 6,084 for the prior Margaret Taylor issue.
Sure the difference is not large, but sales have started to rise all the same.
With Mary Todd Lincoln coming up as the final First Spouse coin of the 2010, that will help reinforce any growing uptrend.
Certainly, if this series has found its bottom, then better times lie ahead.
Tuesday, June 15, 2010 2:06:30 PM (GMT Daylight Time, UTC+01:00)
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Monday, June 14, 2010
Movie full of coins. Wow.
Posted by Dave
I watched a movie on DVD called “Dear John.”
It wasn’t one of those box office major hits and will not likely be a movie with a large fan base.
I was startled by it because coin collecting played a major role in it. It was the one true connection between the lead character and his father.
It was a remarkably good representation of coins offered in a non-hobby context, though the public probably won’t see it that way because the father character was portrayed as being somewhat autistic.
The coins weren’t stolen, phenomenally valuable like a 1913 nickel, and the plot did not hinge on what they were so much as the life of a collector.
The father told the lead character’s girl friend that it was actually his son that got him started in collecting. We later come to find out that this was because the son at the age of 7 found a nickel obverse muled with a cent reverse in change after buying ice cream from an ice cream truck.
Coin dealers came into play, one was honest, one was not.
We had a quick look at Bryan money, a Morgan dollar as well as a well worn Standing Liberty quarter. The Sacagawea dollar was mentioned.
When the son hit the rebellious teenage years, this was signaled by a fight between the two characters where the son exclaims in anger that he is not going to a coin show with his dad because, “You go to a coin show every weekend.”
There was a visit to the Philadelphia Mint.
You get the idea.
How can a movie with so much numismatic information not end up feeling like an ANA club program?
You will have to watch it and see.
Monday, June 14, 2010 1:57:16 PM (GMT Daylight Time, UTC+01:00)
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Friday, June 11, 2010
Tag, euro’s it
Posted by Dave
The sagging value of the euro in recent weeks certainly has gotten the attention of many pundits.
With its current value right about the same $1.17 price it was at when it was first introduced at the beginning of 1999, you might be forgiven if you think that as currency experiments go, this one has been remarkably stable.
Anybody who thinks that hasn’t been watching the foreign exchange markets do their thing on a daily basis.
Markets don’t like stability. Nobody can make a profit on stability.
Something must either be rising or falling for traders to get their profits.
Direction is less important than changes in price.
At first traders drove the value of the new currency down. By the time real euro coins and bank notes were introduced into circulation at the beginning of 2002, the currency had fallen to 82 cents.
Then the rise started.
It doubled in value in dollar terms from 82 cents to $1.60 by 2008.
At the lows there were jokes about the future of any currency that ends in a vowel. This was succeeded by the view that the U.S. dollar was dying and the euro would replace it.
Now we are back to the storyline that the euro is tottering.
What do you make of all these stories?
Rather than guessing about facts we cannot find, it is better to focus on the improved exchange rate and plan your long-awaited trip to Europe to take advantage of the favorable exchange rate.
Better yet, perhaps you can buy some coins on your trip and take advantage of the 25 percent reduction from the peak in the euro’s exchange rate.
Friday, June 11, 2010 1:48:47 PM (GMT Daylight Time, UTC+01:00)
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Thursday, June 10, 2010
Who buys gold Eagles today?
Posted by Dave
The fractional gold American Eagles go on sale today to the Mint’s authorized distributors. They will in turn sell them to the secondary investor-collector market.
Because they are allocating supplies, we already know that the Mint thinks demand is higher than its ready supply.
The question that pops into my mind is where is the this demand coming from?
Are investors scrambling to buy fractional coins?
I wouldn’t think so. The mark-up for the smaller coins is higher. If you want to buy large amounts of gold, buying the smaller sizes is simply throwing money aware.
What about collectors?
Will they rush in right away to try to get examples of each size for their set?
It is possible. Collectors always like to be the first on the block to own something. The expectation that gold will continue to rise in value will not dampen that tendency.
How about non-collector buyers?
That is probably the heart of demand. TV offers and newspaper sales pitches all focus on genuine U.S. gold coins. The price point for the ounce has gotten too high for the average spur-of-the moment panic buyer, so the lower prices of the half, quarter and tenth-ounce pieces is a huge sales advantage – especially the tenth ounce.
There seems to be an unlimited supply of people who will send $100 to $200 for something. The gold value of the tenth fits comfortably at $125. Even with the mark-up, it is still within the range.
So who will do the buying of the fractional gold American Eagles?
We are about to find out.
Thursday, June 10, 2010 2:28:29 PM (GMT Daylight Time, UTC+01:00)
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Wednesday, June 09, 2010
Bulk load of fun
Posted by Dave
Have you still got the circulation finds bug and got a spare $50,000 lying around?
Then boy has has the Mint got a deal for you.
Yesterday it announced its bulk purchase program for the America the Beautiful quarters.
For the handy-dandy sum of $50,000 you can be the proud owner of what is called one bulk bag filled with 200,000 quarters.
Shipping and handling costs $1,500 and payment must made by bank wire transfer so buyers can’t play any more games earning airline miles on credit card purchases of coins for basically face value.
When you get the coins you can dive in and be the first on your block to discover any potential error coins that might have found their way into the bulk bag.
How long will it take you?
I remember going through a bag of 1995 cents looking for the doubled die. There were three of us and it took about two hours as I recall.
So, six hours for every 5,000 coins and that works out to 120 hours of fun. That’s like sitting through 60 movies.
Is that worth $51,500 to you?
Then go ahead and make the Mint’s day. Order that bulk bag now.
E-mail orders to atbbulk@usmint.treas.gov. For more information, visit http://usmint.gov/mint_programs/atb/bulk/
Wednesday, June 09, 2010 2:14:28 PM (GMT Daylight Time, UTC+01:00)
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Tuesday, June 08, 2010
Knowledgeable gold buyers wanted
Posted by Dave
I had a call from a married couple yesterday. They did not identify themselves to me, though it is possible they did so when they first reached my colleague Debbie Bradley.
After the call was transferred to me, it was the wife on the phone. She wanted to know if there was such a thing as a $50 gold piece.
I told her about the $50 American Eagle one-ounce coin.
I explained that these coins had been struck by the U.S. Mint since 1986 and that they were then sold into the bullion market, priced and traded at the current price of gold plus the mark-up.
She wanted a ballpark figure, so I said $1,250 plus the mark-up, which I said fluctuates.
She wondered why she couldn’t find this information in her book, though she never told me what it was. Perhaps she would have, but her husband was asking questions in the background and finally his wife gave him the phone.
He wanted to know about $20 gold pieces and what they were worth. I told him they traded among collectors based on condition.
He was impatient with that. He asked what’s the base price if the coin was in terrible condition.
I said it was worth the gold price or roughly $1,250 because it contained 96 percent of an ounce of gold.
He retorted that that’s what I had told his wife was the base price of the gold $50.
I said that’s because they are both approximately the same weight.
“You mean the $20 weighs the same as the $50? How can that be?
More or less, I replied, because the $20 was struck 1933 and before and the American Eagle was struck to a different standard starting in 1986.
He couldn’t seem to wrap his mind around the concept of the $20 and $50 coins being roughly the same weight and repeated the same questions.
Then he threw in the statement that someone was offering him coins for $500.
I replied that if they were one-ounce coins they were probably fake. I suppose I could have said stolen, but I didn't get that far before he blurted out:
“I don’t buy fakes,” he exclaimed indignantly.
I asked why anyone would sell a coin to him with a base value of $1,250 for $500.
He was silent and still indignant.
He did not volunteer the identity of who was offering him the coins or what this person or firm claimed the coins to be.
After 10 minutes of this, he was ready to go, said good-bye and hung up.
I fear that the callers are going to end up having less money at the end of the week than what they started with.
Tuesday, June 08, 2010 2:19:09 PM (GMT Daylight Time, UTC+01:00)
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Monday, June 07, 2010
Training us for life without the cent?
Posted by Dave
I bought a Coke the other day at a gasoline stop for 99 cents. With tax it came to $1.04.
I handed the clerk $2.
She handed one of the dollar bills back to me and said that she could cover the four cents from the take-a-penny dish on the counter.
I protested a bit, saying I thought grabbing four cents was a bit much. In the back of my mind was the rounding convention. I might accept one or two cents, but three or more should get rounded up to the next nickel.
I know this was not a rounding situation, but I was coming to conclusions that I think most people would and they seem to be based on the rounding convention.
If I asked a poll question, “Should people be able to take four cents out of the dish for a $1 transaction?” I would expect a sizable number would say no, feeling uneasy taking what amounts to four percent of the amount tendered. Had I purchased gasoline and the bill was something like $22.04, that would be a different story.
Perhaps the take-a-penny dishes are more than just conveniences for those of us who need an odd cent from time to time.
Perhaps they are a back-door way of training us all how rounding would work in practice.
After all, what difference does it make if the merchant rounds the purchase price down by two cents or whether the clerk grabs two cents out of a dish?
And, instead of taking four cents as the nice clerk did for me, under most conditions, especially if there are other customers in line, it is likely I would not have gotten the gift.
Isn’t it amazing what an extra four cents can do?
Monday, June 07, 2010 2:17:37 PM (GMT Daylight Time, UTC+01:00)
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Friday, June 04, 2010
Will there be a rush for fractional gold Eagles?
Posted by Dave
The news that fractional gold American Eagles will be sold starting June 10 has both good and bad elements in it.
On the whole the good news is very good and outweighs the bad news.
The beginning sales date is almost six months earlier than last year’s Dec. 3 commencement. That’s the good news.
It is a strong testimony to the Mint’s confidence level for meeting market demand.
Last year buyers snapped up 110,000 half-ounce, 110,000 quarter-ounce and 270,000 tenth-ounce American Eagle gold coins before the month was over.
Presumably, the Mint expects to be able to fulfill at least a similar demand level and probably more.
That’s where the bad news comes in. The Mint has said that it will use its standard allocation process to its authorized purchasers. That is another word for rationing.
This decision might simply be the result of extreme caution by the U.S. Mint. They simply don’t know what might happen to demand when sales begin. This gives the Mint an ability to get the program started and then make adjustments later.
Unlike last year, the one-ounce gold American Eagle now is available in quantity where supplies of the one-ounce coin were being interrupted when the 2009 fractional coins were being sold.
What all of these factors will add up to in terms of results will be most interesting to watch.
Friday, June 04, 2010 2:17:34 PM (GMT Daylight Time, UTC+01:00)
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Thursday, June 03, 2010
Fractional gold Eagles ready June 10
Posted by Dave
Fractional gold American Eagle bullion coins will go on sale to the Mint's authorized purchasers next Thursday, June 10, it has just been announced.
The Mint said initial supplies will be distributed according to its standard allocation process, which is another name for rationing.
However, rationing or not, gold buyers will undoubtedly welcome whatever coins become available.
It will be interesting to see if there is another feeding frenzy in the works or whether demand will settle down enough to allow the Mint to remove the allocation restrictions quickly.
Thursday, June 03, 2010 4:26:21 PM (GMT Daylight Time, UTC+01:00)
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Coin production points up for economy
Posted by Dave
Time to break out the party hats to celebrate the end of the recession?
Could be.
Mint circulating coinage production in May jumped 45 percent over the April total.
These coins aren’t coming off the presses to go into storage. There is demand for them in the general economy.
Already the Mint has struck more dimes than in all of last year.
Cent production looks to be on pace to exceed last year’s and there is only one design, not four.
Nickel production is still lagging last year’s pace. With seven more months to go in the calendar year, it is too early to conclude this will be a speculator’s dream coin even though the total of 29.28 million pieces struck only at Philadelphia is well below the combined 86.64 million nickels turned out by Denver and Philadelphia in 2009.
Quarter, half dollar and dollar production is nothing to write home about yet, but only the quarter is actually used by the economy. A case can be made that the billions of state quarters out there are finding their way into circulation so current lower production isn’t an economic indicator as much as cents and dimes might be.
Of course others might argue the opposite.
Either way, it is the general coin production upward trend that is the economic good news. A growing economy will put money in the pockets of many collectors and some of that will find its way into the hobby.
Thursday, June 03, 2010 1:32:49 PM (GMT Daylight Time, UTC+01:00)
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Wednesday, June 02, 2010
Sets mark passage of time
Posted by Dave
How do you feel when you are behind the wheel of a new car?
How did you feel when you walked into your new home for the first time as owner?
Wasn’t it a little bit like how you felt when you bought your first coin or collector set from the U.S. Mint?
I began thinking along these lines because I see that next month the Mint will offer collectors its standard issue proof and mint sets. With all of the products coming out of the Mint today, it is easy to give these traditional sets short shrift.
With gold and silver in the headlines and a continuing scramble by buyers to buy gold and silver, Eagles can make the proof and mint sets seem at best to be something of secondary interest.
For me, though, they always come to the fore first because of the mental associations I make with them. These issues are like birthdays, or a mile markers for me.
They tell me how far I have come in the hobby.
The very first proof set I ordered was the 1969 set. As chance would have it, that offering sold out in six days. That reinforced the sense that the set was special and I was privileged to own it.
Later it taught me that what goes up in price can also go down.
I think every collector has a memory of that first Mint acquisition in his mind.
For my generation of collector, it was the proof and mint sets because there was basically nothing else to be purchased from the Mint.
For other collectors it might be Ike dollars, Bicentennial coins, Prestige proof sets or since 1986 even the American Eagle coins that are today so much in the headlines.
What Mint product fills that place in your mind?
Wednesday, June 02, 2010 2:28:05 PM (GMT Daylight Time, UTC+01:00)
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Tuesday, June 01, 2010
Who will step up and buy gold Buffalo proof?
Posted by Dave
On Thursday the U.S. Mint will issue the proof 2010 one-ounce gold Buffalo coin. It will be very interesting to see what level of demand is manifested and where the Mint will place the order ceiling.
The 2009 proof had a mintage of roughly 50,000. If the Mint holds to that level, it is conceivable that in the present economic environment that a sellout could occur rather rapidly.
I know that we are talking roughly $84 million to buy a gold issue of that number, but what’s $84 million to people who are worried about the end of civilization?
It is also conceivable that the market will be left to collectors, rather than see investors go barreling in to take advantage of another avenue of acquiring official U.S. gold in the wake of the ongoing European debt crisis.
It will depend on the level of rational calculation being made by would-be buyers.
The key factor is the roughly 35 percent mark-up that the Mint will charge. Will that put hard-headed buyers off, or has confidence gotten rattled enough that it won’t seem so high?
World economic conditions make life more and more like a video game where as soon as one enemy is despatched, two or three more pop up to take its place without time for any deep reflection to occur as to why the game is being played in the first place.
Tuesday, June 01, 2010 2:16:53 PM (GMT Daylight Time, UTC+01:00)
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