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Bargain gold a hedge or hold?

More one-ounce gold American Eagle bullion coins have been sold  by the United States  Mint in October than in any other month of 2016.

And the month is not over yet.

Sales of the popular investment coin might be significantly higher by the time Nov. 1 rolls around.

Why are sales so strong?

It is tempting to point to lower prices.

The precious metal is significantly cheaper that it was a month ago.

Gold took a tumble at the beginning of October.

Price fell from well over $1,300 to the present $1,271.

The October Mint sales figure of 94,000 one-ounce gold Eagle coins edged out the 93,500 number recorded in April.

The price of gold in April was in a range $1,220 to $1,250.

In January, when the usual demand surge occurs, 89,000 one-ounce coins were sold.

The price of gold then was for a time under $1,100.

This seeming price sensitivity among buyers might be confirmed as sales tumbled hugely in July and August as gold made a run toward $1,400.

Case closed?

Is it merely a question of price for October gold buyers?

As the end point of the Presidential election is reached on Nov. 8, supporters of both candidates forecast an apocalypse if the other side wins.

Stocking up on gold is a traditional hedge against uncertainty.

Is there bipartisan agreement on that now?

Could be.

That, if true, is something worth having.

As gold becomes more and more mainstream, more potential buyers are added to the demand pool.

The downside, of course, is that Wall Street money now comes and goes.

The popular Exchange Traded Funds for gold were buying at the beginning of the year.

They were selling during the recent price tumble.

If gold coin buyers are opinion leaders, the ETFs could switch direction yet again.

Because the U.S. Mint sells four sizes of gold Eagles, gold demand can be measured in terms of ounces sold.

In that case, October sales are the second highest of the year. January is first.

Should that change our basic conclusions?

I don’t think so.

Buzz blogger Dave Harper has twice won the Numismatic Literary Guild Award for Best Blog and is editor of the weekly newspaper “Numismatic News.”

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