Dates can jack up price of bullion Eagles

Most collectors are familiar with the story of the Maria Theresa thaler. It is a silver dollar-size coin, that contains 0.7517 troy ounces of silver. The coin was part of a series that ended in 1780 with the death of the Austrian empress.

That wasn?t the end of the coin. Restrikes have been made of it in very large numbers for the past 150 years. It was used in trade. It was so popular that the Austrian Mint still makes it. Other nations have counterfeited it, not to debase or destroy it, but to get in on the East African trade that used the coin.

The way the story is often told is that the people who used it were so backward that even a date change would raise their suspicions. So the date stayed unchanged for over two centuries.

The one I bought from SilverTowne for $1.95 in 1967 is still the same coin as one that comes off the coining press today. The silver value makes it worth almost $13 at the present market rate for bullion. It was worth over $15 at the recent silver peak. It has no other value. But that?s the point. It?s value comes solely from its silver content.

That was the idea behind the American Eagle silver bullion coins. The one-ounce pieces have been struck since 1986. The even troy ounce weight makes it a far superior coin in terms of ease of valuation, but the fact that the dates change seems to be a handicap.

What do I mean? Coin dates change all the time.

Yes, they do, but consider the valuations of the American Eagle. Coins dated 2008 are currently in short supply. Why? Everybody seems to want some to take advantage of the past week?s nearly 20 percent drop in the price of bullion. It may not be any surprise that market savvy investors might want to buy on the dip and hope to profit. But the focus on the 2008 date has caused a shortage of the coins on the market. The Mint cannot turn them out fast enough. The price of each coin is marked up more as a consequence.

Buyers have to ask themselves: are they buying silver bullion or a coin dated 2008? If the premium is too far out of line and it goes back to normal levels, the buyers have basically given it up, though, of course, silver could rise enough in value to overcome the disappearance of the extra premium over time.

That is the long story route to my question: Were the users of the Maria Theresa thaler smarter than buyers of American Eagles? For them, a piece of silver is a piece of silver is a piece of silver. The price is the same.
Buyers of American Eagles pay fluctuating premiums for their coins depending upon time of year and market conditions. This can sometimes not be an efficient way to buy silver bullion.

On the other hand, if you are a collector and not a silver speculator, now might be a good time to trade out any silver Eagles you might have for the years you do not have, because many of the price distinctions made between various years have either narrowed sharply or disappeared completely.

The opportunity wouldn?t exist for collectors if all coins had the same date, but collectors have a different motivation and those pesky differing dates do exist.