Are you supposed to be a gold coin collector?
From all of the precious metal headlines, you would think that nearly all of us would be, but in fact the opposite is the case. Most of us are not cut out for it.
This is not a matter of personal interest or of being incapable of learning to grade them. It is simply a matter of lack of spare cash.
Gold is expensive. Few would probably argue that point today with bullion trading at $1,575 a troy ounce. But it has always been expensive. When gold was $20 a troy ounce, almost no collectors could afford to put away examples of gold coins as they were issued at face value, let alone at some sort of mark-up as collectors must do.
Think about the sum of $100,000. Most readers would think it is a very large amount of money. Yet if you had 61 American Eagle 1-ounce bullion coins bought at bullion price plus a 4 percent mark-up, you would have $100,000 worth.
There are more than 61 double eagles in the Liberty Head set of 1840-1907. Bullion value alone of this set is multiples of $100,000 because there are over 150 coins in the set, and this is not even taking into account having the coins in Mint State, or the key low mintage dates, or the proof-only issues.
No average reader of Numismatic News in his right mind would under take to collect this set.
Yet nearly all of us fall at one time or another to the siren song of gold.
Who bought the first of the First Spouse gold coins in 2007? How about the first proof gold Buffalo coin in 2006, or the first gold proof 1-ounce American Eagle of 1986? Then there have been assorted appealing gold commemoratives. The 1984 Olympic $10 coin was the focus of buyer frenzy at its launch.
Few of us do not have one of these coins in our collection. However, most of us don’t have all four, let alone a full set of the ongoing series.
Why do we keep falling for a gold coin here or there even though we really can’t afford to actually collect coins made of this precious metal consistently?
Their beauty? Their history? Their economic value? Their hedge against catastrophe? It’s all of the above.
I have been falling for gold ever since I was a kid.
The very first gold coin I ever bought was a Mexican restrike 2-pesos. It was absolutely tiny at .0482 troy ounce weight, but at the current price of bullion it is worth over $75. When I bought it the bullion value was $1.69. If only all of my investments could have multiplied in value like that. But 45 years ago I could afford gold even less than now.
I bought a few British gold sovereigns. I later added a couple of BU gold $20s. Other than the 2 pesos, all of these early purchases went toward college.
All the while, I could never really afford to collect gold. What I am is a serial sucker for it. It’s just so darned attractive I forget that I cannot complete the full set when I see something I like.