This article was originally printed in the latest issue of Numismatic News.
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Strength in common date silver dollars continues again this week. Demand is both promotional and investment driven. The investment aspect comes from the obvious silver melt value with a moderate premium for a 75- to 150-year-old coin. This demand is generally moderate, but often spikes with various news items regarding the threat of possible bullion confiscation in an eventual attempt to fix our out-of-control monetary situation. The idea is silver dollars are old money, collectible, tradable and therefore a lot safer than bullion. The way the other side of the coin works is that promoters via TV, radio, telemarketing, print media and direct mail come up with a lead item with general appeal and a good story for the unknowledgeable public. It is called the hook. In the case of Morgan dollars, a first and last year set is one of the more common hooks used. Once this set is delivered, the offers expand and a set of all mints (mixed years) is offered or a decade set of one per year and this generally leads to a one-per-year complete date set. These are usually done as continuity programs, meaning a monthly shipment with easy payment terms at two to three times normal competitive retail. The demand for material to fill these sets is big and continues to grow, causing items like silver dollars to no longer trade off the silver price as much as they have in the past.
The Boston ANA was successful, especially when you consider the number of auctions before and during the show. The two separate preshows, each a major event in itself, were both reasonably successful as well.
Last month we did an extensive review of silver Washington quarters and promised the later dates for this issue. All have been done as promised and hopefully the 50 state issues will be updated next month.
The precious metals market has been trying to find a direction for the last several weeks, bouncing between the mid $1,100s and the low $1200s on gold, silver moves from low $17s to high $18s and platinum moves from $1,500 to $1,600. In general, gold is following monetary issues while silver and platinum are more influenced by industrial demand.
Larger U.S. type gold coins pretty much follow bullion lower while smaller issues have increased in price. Proof gold Eagles have lost about 20 percent of their premium due to rumors of new Mint production of 2010 coins. The silver issues have also softened, but only by about 5 percent.