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Where did the notion of cheap gold arise?

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I had a phone call this morning to start off my day. It came from a fellow who wanted to call the Philadelphia Mint to tell somebody there that he was displeased by the price of the Madison First Spouse gold coin, though he first referred to it as the Dolly Parton coin, then corrected himself to Dolley Madison.

The point of this column is not to make fun of a slip of the tongue. I do that myself and staff often hear me exclaim from time to time that it is a good thing I make my living as a writer so I can change things.

My point here is to deal with an interesting point of view that seems to be gaining currency among some individuals who buy coins from the Mint.
This fellow thought that because the Mint surely must have gold laying around in inventory for many years that was purchased for far lower prices than are current that collectors should be able to buy coins made of it more cheaply.

This view is incorrect on at least two counts. The Mint does not have a large inventory of gold bullion purchased for its own account years ago at much lower prices. It is an active gold coin producer that buys bullion on the open market. Its costs are essentially current.

It might be easy to forget that since gold ownership was legalized at the end of 1974 that the Mint has been striking gold commemoratives since 1984, American Eagle coins since 1986 and Buffalo coins since last year. The Mint has coined millions of ounces of gold. It is usually mandated to buy American mined gold bullion.

But even if it did have piles of gold from years ago, what kind of public policy would it be to sell it off for under market price? The Mint is mandated to run itself like a business, meaning it is expected to turn a profit. However, even if it were not so mandated, does that mean anyone should be able to carry off federal property at cost? Who wants dibs on Fort Knox for $20.67 an ounce? Or at any other price up to $35 an ounce that Franklin D. Roosevelt used to set from his bed in conference with the Treasury secretary in 1933?

I don?t think the caller would want to sell his own property, say a house, at his own cost. He would rightfully want the full current value.

Being long interested in the coin field, I have seen the Mint go from giving collectors virtually nothing in 1965, to grudgingly supply proof and mint sets to the current explosion of a whole host of items in many varieties of packaging.

Having too many collector coin choices from the Mint is way better than having no choices in things to buy, but the idea that the Mint owes collectors special deals for under market prices is as peculiar a notion as the idea that it should offer absolutely nothing to collectors.

Where is the happy medium?

The key is that whatever is offered should be accessible to all at market prices that collectors can take or leave freely. Noncollecting taxpayers would have every right to be upset with anything else.

If any price is indeed too high, the secondary market will knock it down and we will get a crack at the same item for less money.

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