AGE Gold Market Update

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Joined: Wed Sep 03, 2008 6:57 pm
Location: California

AGE Gold Market Update

Post by mkb » Thu Sep 17, 2009 10:33 am

Here's an interesting excerpt from a recent commentary by the American Gold Exchange:

Classic U.S. and European gold coins gaining

We’ve just returned from the latest major national coin show, this time the Long Beach Coin Expo in California. After attending this show for almost 30 years, we can unequivocally say that classic U.S. gold coin availability was the lowest we’ve ever seen in Long Beach. The national supply of low- and mid-priced U.S. gold coins (in the $500 to $5,000 range) is virtually nonexistent. The supply of higher priced rare coins remains weak but some quality coins—ones meeting our admittedly high standards—are available. Demand is strong but new supplies are not surfacing. If we go through another significant surge in demand, which a higher gold price will certainly spur, prices for classic U.S. gold coins are likely to move much higher.

Gains in the largest-sized coins like classic $20 Liberty and $20 Saint-Gaudens are leading the pack, with $10 Liberty and $10 Indian gold coins following closely behind. The smaller $5 and $2.50 gold coins are lagging in price at the moment, so some better buys are available in those sectors. Please take a look at our Common Date U.S. Gold Coins page. In our opinion, these coins offer the best combination of scarcity and value in various grade levels.

The current market in classic U.S. gold coin market is one of the most fundamentally sound we have ever seen, with demand continuing to override supplies. We expect this trend to continue as we move into the fall and winter buying season and well into first quarter of 2010.

Like classic U.S. gold coins, demand for classic European gold coins remains strong as well. Supplies are currently better than we have seen for most of 2009, and the traditional summer lull has allowed some modest restocking, but supplies remain shallow. A sustained buying surge of any sort could easily wipe out existing dealer “on the shelf” supplies. Premiums for these smaller-sized gold coins, minted primarily before 1935, remain at the levels they have been at for the past year.

World mints have stopped producing gold bullion coins smaller than the 1-ounce size with any regularity, so European gold coins are the best option in smaller gold coins. We prefer them anyway because they provide all of the benefits of bullion plus the true scarcity and added profit potential that only classic coins offer. Plus, they’re non-reportable and secure from confiscation under current laws. We currently have good supplies of two favorites: British sovereign “Kings” (BU) and Swiss 20 franc “Vrenelis” (BU) . Get ‘em while you can!

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