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Coin Sales Strong Despite Gold's Decline

Gold bars, illustration

The spot price of gold and the subsequent demand for the yellow metal has been declining for about four weeks as this column is being written. The main culprit isn’t demand, but the strong price of the U.S. dollar on the world market. Coin dealers are not reporting any significant decline in the sale of gold bullion or collectible gold coins, indicating that while investor demand for gold may be down, there may be fewer speculators and more serious buyers in the gold coin market than may have been thought. This profile doesn’t appear to be limited to the market for bullion and generally collectible gold coins. The same scenario is playing out for silver.

Serious collectors with the appropriate financial resources are continuing to seek the scarce to rare coins at what is continuing to be record-breaking prices. The Hendricks Set of United States gold coins from the Fairmont Collection recently realized more than $13.6 million at auction. The 506 lots in that sale averaged near $30,000 individually, with more than 70 percent of the collection setting new auction records for either the grade or the overall issue. The parade of outstanding rarities unavailable for years continues to once more be marching.

There is strong confidence in the coin market despite the economic turmoil being witnessed in equities that is slowing the growth of non-collectible markets. An observation to take seriously: cryptocurrencies are in free fall as this is being written. Gold and silver are traditional stores of value that are once more demonstrating their staying power during turbulent times when other monetary vehicles that have been touted may fail.