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One bullion we don't need

Montana’s two senators want the United States to begin striking bullion coins out of palladium. They introduced legislation in early April calling for a .995 fine one-ounce coin.

No surprise there as Montana has the only working palladium mine in the United States.

The senators’ action follows a long line of Western legislative history of supporting mining with metal purchases and turning the metal into coinage.

The Bland-Allison Act of 1878 started the ball rolling, mandating silver purchases and the production of what became the Morgan silver dollar series.

Most Americans probably don’t know what palladium is. I have never seen it even though there have been a few coins made of palladium since Tonga issued the first one in 1967.

Its exotic nature hardly recommends a palladium bullion coin to the investment crowd. When the financial markets became fearful they rushed to embrace what they knew, gold and silver bullion coins. Even platinum, which I assume we are more used to now than we used to be, was abandoned in the bullion coin buying spree of the past year.

The palladium coin proposal is also odd in another way. It wants it to copy the Ultra High Relief Saint-Gaudens gold coin design currently being sold to collectors, right down to the 27mm diameter.

Now making a one-ounce palladium bullion coin just 27mm wide will make it look more like a rubber bathroom sink stopper than a coin.

The question of whether we actually need another bullion coin aside, couldn’t the writers of the bill come up with a more plausible coin? They should have at least had the initiative to raid the Mint’s old coin design cupboard and come up with a Standing Liberty bullion coin or a Mercury bullion coin, or perhaps an 1804 dollar restrike bullion coin.

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7 Responses to One bullion we don't need

  1. Scott says:

    The mint already has enough bullion coins they can’t produce due to lack of raw material. Why add more?

  2. Does palladium sell? I don’t think Canada’s palladium coins sell, and the Royal Canadian Mint is well respected. Maybe (hopefully) this bill will die in committee.

  3. coin update says:

    The RCM offered the palladium Maple Leaf for only three years. By the final year, they only sold about 15,000 of them.

  4. Z says:

    I think it would be a good idea, but instead of copying the $20 Double eagle design (as it is being currently done in gold as it was intended), why not a do modern replicas of other coins (ie high relief type I Standing liberty or Type I Buffalo nickel)? …and of course the 1804 silver dollar.

  5. Matthew says:

    I’ve been trying to get my hands on palladium maple leaf bullion coins for over a year… guess what? I’ve yet to find a dealer who actually has any available for delivery. Palladium is awesome stuff in my opinion. It doesn’t tarnish like silver and has an industry driven demand. The volatility of palladium can make it an attractive investment. Palladium is a member of the platinum family of precious metals and the majority of it is produced as a by-product of nickel mining operations. Palladium is frequently used as a lower cost substitute for platinum in catalytic converters by the auto industry. The majority of palladium comes from Russia and they’re not forthcoming about the volume of their supplies or reserves. They have, on more than one past occasion, witheld palladium from the market for their own financial gain, causing palladium prices to shoot upwards during the supply short. Although palladium tends to come out of the ground at about twice the rate of platinum, it frequently sells for a fifth of the price, or less. Palladium reached a record high back in early 2000-2001, when supply disruptions caused the price to shoot up to nearly $1,100 an ounce, nearly equal to the price of platinum at the time.
    The old addage of not putting all your eggs in one basket certainly applies here. Looking forward at the metals market, I would love to have palladium as my second largest position (behind silver).
    Although palladium may be a niche market, I would certainly be an avid collector and investor. I think if others were educated about the investment potential, they would agree with me. Its disappointing to see folks bashing this for the reasons of – "I don’t like it, why do we need it, I hope this bill dies…" just shows ignorance on the previous posters’ behalves, in my humble opinion. I do agree that a different classic, or a new unique design would be preferable over re-hashing a classic design that has already been re-used for a seperate bullion coin. But, if it fails to be implemented in the U.S., I guess I’ll have to send my money to Canada… I’ll remember to pre-order this year 😉

  6. Lope says:

    If the Mint could actually handle production of a palladium coin, I’d be all for it. However, I agree with others that they should come up with something new or recreate a classic design for this bullion.

    Also, if if helps the mining economy of Montana, why not?

    Just as long as they don’t go buying palladium from Russia like they’ve done with the gold planchets from the Perth Mint!
    I thought law said all gold bullion must come from gold mined in the U.S.?

  7. Coiny says:

    I would love to see a Palladium one ounce coin, there is just something about one ounce coins that makes them the best.

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