November 16, 2009 Posted by James Randolph on November 16, 2009
November 16, 2009 – The certified gold coin market has been booming since 2001, and projections are for the yellow metal to outperform dollar-backed assets by as much as 12-18% in 2010. The recent influx of investors into the certified coin market has created a new market for savvy pitchmen: certified gold bullion.
Certified gold bullion has been purchased by some investors, who have been subsequently disappointed with the buyback price for these bullion coins. Collectors could see some substantial gains in these coins in the next 100 years, but they coins are presently nothing more than a commonplace bullion item. Shrewd salesmen have been able to manipulate consumers into buying modern-day American Gold Eagle coins that have been certified as “Mint State.” This means that the coin is in pristine condition, but that is nothing special for coins that are less than 20 years old.
The Professional Coin Grading Service (PCGS) and the Numismatic Guaranty Corporation (NGC) inspect and grade historic and modern-day coins. Investors generally buy coins that were minted prior to 1933, because these coins are deemed by our government to be private investments. When each coin becomes certified, it has been granted “Mint State” status. It is given a serial number, issued a Mint State ranking (61-70) and sonically sealed in a tamper-proof slab.
It is important to understand that coins do not become non-confiscatable simply by receiving a Mint State grading. Executive Order 6012 states that coins of “recognized rare and unusual value” are exempt from gold bullion confiscation. Brand new coins that are produced in high volume are not rare or unusual, even if it is in perfect (MS70) condition. Coins that have been issued by the US Mint since 1986 should be in excellent condition, so investors are wise to ignore savvy marketers who want to convince you otherwise.
If you require a short-term position in the gold coin market, uncertified bullion coins may be a shrewd investment. Long-term gold investors should avoid bullion because it could be confiscated within the next year due to the weakening dollar and out-of—control government debt. Certified historic coins may be a better financial decision if our economy’s health is your concern. Give us a call today if you require free, customized mail-out reports on a wide variety of gold investments.
Senior Staff Writer – Certified Gold Exchange