A sunken Russian warship off the coast of South Korea has treasure aficionados buzzing once again.
The ship was a victim of the 1905 Russo-Japanese war.
It is supposed to be full of gold.
In fact, the stories cite values that are so implausibly large that I don’t believe either.
The Daily Mail from Great Britain offers a slightly different figure, but still implausibly large.
It says $113 billion.
However, it also says, “Donskoi is believed to have been carrying the gold supplies of the entire Second Pacific Squadron when it sank, which would be worth $133 billion at today’s prices."
Why don’t I believe the value numbers?
While I can believe the ship had an entire payroll aboard, my doubts come from simply doing the math.
A quantity of 200 metric tons of gold means the ship was carrying 6.43 million ounces of gold.
The current gold bullion value for one ounce is $1,215.80.
That puts the value of the potential gold hoard at $7.8 billion.
Such a sum is huge. But it is nowhere near $130 billion.
The CNBC story reported 5,500 boxes of gold bars and coins.
I just did a story about an upcoming coin auction featuring three bars of Gold Rush gold from California.
These are very desirable items to American collectors.
Pre-sale estimates are roughly twice melt value.
If we value the gold bars on the Donskoi at twice melt, we can ratchet up the $7.8 billion to $15.6 billion.
That is bigger than huge, but still much less than $130 billion.
To reach $130 billion, the recovered gold would have to be all coins sold for 16.66 times melt value.
You can buy a common date Liberty Head gold $20 for $1,254.09 on the APMEX website.
Melt value is $1,176.
Would coin collectors pay $19,592.16 for this coin if it had been brought up as recovered treasure?
We aren’t that stupid.
Premiums are paid for treasure coins, but not like that across the board.
A Russian warship also is not likely to be carrying many MS-67 rarities of even Russian coins that might help the total value along.
I think it is more plausible that there is no gold at all on the ship than that it contains gold worth even the much lower $7.8 billion number.
But it is an interesting story despite the exaggerated gold value estimates.
Let's keep watching.
Buzz blogger Dave Harper won the Numismatic Literary Guild Award for Best Blog for the third time in 2017 . He is editor of the weekly newspaper "Numismatic News."
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