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Are collectors running out of money or are they losing interest in proof gold American Eagles?

This article was originally printed in Numismatic News.
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Are collectors running out of money or are they losing interest in proof gold American Eagles? I raised a similar question with proof silver American Eagles in last week’s paper in a “Best of Buzz” column as something to watch for when the silver coins go on sale in June. I blamed high prices for the situation with the silver proofs. Collectors do not have unlimited funds to buy new issues.

For the 2011 proof gold American Eagles, the sales numbers are already coming in and they definitely are weaker, but is this a case of high prices or a dropping level of interest? The answer is less clear-cut.
To be sure, gold has gone up a bit since the 2010 American Eagle proofs were offered in October. But gold is not rocketing higher as silver has done. The one-ounce 2010 proof coin in October was priced at $1,585. The one-ounce 2011 coin is $1,785.

Can a $200 price differential account for the following drops in sales numbers:

From the April 21 opening date to May 1, collectors purchased 11,339 one-ounce gold proofs dated 2011. In the Oct. 7-Oct. 17 opening period last year collectors bought 19,195 pieces of the 2010 coins.
The current price of the 2011 one-ounce coin is 12.6 percent higher than the 2010 coin, but demand in the first 10 days is down by 40.9 percent.

Cause and effect?

While you are thinking about that, look at the other numbers.

Sales of the 2011 half-ounce proof are 1,941 pieces compared to 2,879, down 32.6 percent this year.

The quarter-ounce number is 2,853 compared to 3,449, a lower number by 17.3 percent.

For the tenth-ounce proof, the 2011 figure is 6,705 coins sold compared to 8,538, down 21.5 percent.

For the four-coin gold proof set, the 2011 sales are at 5,545 sets compared to the 2010 number of 9,987 sets. This sales option has suffered the largest percentage loss of all, or 44.5 percent.

Only the one-ounce proof gold coin sold out last year. The other sales options fell short by varying amounts. The Mint might not achieve even one sold-out option this year.

Perhaps accounting for collectors losing interest in the proof gold Eagles, we can see that the Mint is throwing out a lot of expensive new coins at the same time. The two 5-ounce 2011 silver bullion coins went on sale April 25 and the silver 2010 Hot Springs collector 5-ounce coin saw sales begin April 28.

Neither one of these silver programs has seen the total supply taken by buyers as of May 3. The Mint still has 15,200 of the bullion coins left (it has not broken down the numbers between the two designs yet). For the Hot Springs coin, about 2,000 of the 27,000 available are still to be sold.

The remainders of both silver programs are likely to be purchased. They certainly are the current hot things. But for collectors to buy them, it takes money, and with all these popular programs collectors may be coming to the edge of what their wallets make possible.

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