By David Lew
Two months after gold posted the historic high price of $1,227 per ounce, bullion investors have been caught in pains of losing money for every ounce of the yellow metal. On Thursday, gold plunged to its biggest one-day loss in 16 months. The yellow metal fell 4.4% in volatile trade, plunging below $1,060 an ounce.

Is all the bubble talk on gold turning true? Is gold price headed down to $1,000 or below that level in February? That is the question bullion investors and gold analysts are asking these days.

The biggest irony and risk in investing in gold these days is the disastrous predictions that bullion analysts with investment banks have been making all these months. While some analysts have predicted that gold price would skyrocket to an astronomical high of $3,000 to $ 5,000 per ounce in few years, several banks have been consistently predicting a great bull run for gold all these days.

I have been wondering whether the hype on gold price is created by bullion analysts with global banks.

Read now some interesting comments that several investment banks have made on gold recently:

According to Ernst and Young, which employs 144,000 people around the world, gold price will continue to rise in the long-term, reaching as much as $2,500 per ounce within the next two years.

”The underlying factors driving up gold prices remain in play and will continue to do so for some time, meaning that the precious metal will remain an attractive proposition. Gold prices will remain high. The world is not out of trouble and inflationary pressures cannot be ignored,” the investment bank said.

Recently, leading British bank Standard Chartered predicted in its latest Commodities Quarterly report that gold prices will continue to advance, with a particularly strong showing in 2010.

“The increased availability of scrap gold as prices surge to new highs will see gold average $1,300/oz in Q4 2010 – once the dollar resumes its weakening trend,” said Standard Chartered Bank.

It said that anyone with gold investment in their folds is well-positioned for a great future.

Similarly, Commerzbank said recently: “A further gold price increase has to be expected, especially as short-term-oriented market participants are likely to be jumping on the bandwagon.”

Likewise, Africa’s Standard Bank said that households in China have become the world’s No.1 buyers in 2009. “There is still very good physical demand for Gold ahead of [early Feb's] Chinese New Year.”

While several banks have been predicting a boom time for gold, there is one global bank that has been consistently sharp on gold price—HSBC.

Some months back, HSBC announced its gold price forecasts for 2009, 2010 and 2011. The world’s largest financial services group predicted that the yellow metal would average $990 per ounce in 2009.

HSBC also revised its estimate for 2010 from $950 per ounce to $1,100 per ounce, while it now pegs gold at an average of $975 per ounce in 2011.

Globally, banks have been the aggressive traders in gold. Banks view gold as safe assets. Banks lend money to people, if they are ready to pledge their gold for loans. Central Banks are trying to build up gold reserves so that nations’ foreign exchange reserves are stable and secure for the future.

But the only trouble is that when banks begin to predict gold prices, things go haywire in bullion market. Banks predict gold prices according to their whims and fancies. So, it would not be too much to say that banks are, in fact, trying to create the bubble phenomenon in gold, by forecasting gold prices without throwing light on basic fundamentals.

Can the bullion analysts and banks stop predicting gold price? Can the physical gold price go up or down according to the precious metal’s inherent asset and holding value?

Commodity Online

Platinum and palladium had a thrilling start to 2010 on the expectation and then reality of a US-based exchange traded fund, says a report from Fortis Bank Nederland – The Metals Monthly January 2010.

Platinum, trading at just $1,399/oz on 28 December, reached $1,627/oz by 20 January, a rise of 16%. Palladium saw an even more explosive rally, rising from $352.50/oz on 22 December to $462/oz by 20 January, an increase of 28%. This was its highest fixing since July 2008, when the price was coming down from the spike higher caused by South African electricity shortages.

Short term outlook on platinum and palladium

If our projections for ETF demand are correct, we will see more buying in the next few months. This should support prices; however investors will need a compelling story to maintain their interest and so car sales, particularly in the US (for palladium) and Europe (for platinum) will be key. At recent levels a lot of good news from both appears already priced in. Short-term London fix, platinum: $1,475/oz-$1,600/oz, palladium: $400/oz-$475/oz.

What kind of impact will the US ETFs have?

After a nine-month wait, physical metal platinum and palladium exchangetraded funds (ETFs) were launched in the US on 8 January by a subsidiary of UK-based ETF Securities. Trading on NYSE Arca, the two products are called the ETFS Physical Platinum Shares (share code PPLT) and the ETFS Physical Palladium Shares (PALL). In their first 11 days of trading the platinum product acquired 194,000 oz of metal, and the palladium product had just short of 400,000 oz. This compares well to the already existing products, the UK ETF Securities and the Swiss ZKB, which collectively at the end of 2009 held 676,787 oz of platinum and 1,163,302 oz of palladium. But they have been in operation for nearly three years; it took the UK ETFs 40 (for platinum) weeks and more than two years (for palladium) to match the figures that the new US product has already managed. Trading volumes are higher still.

This bore out the confidence of the bulls, who had anticipated the launch of US PGM ETFs to boost the price. The thinking behind this is the larger size of the US domestic investment market, and, more crucially, the experience in gold and silver ETFs, where there are already US products. In gold the three US gold ETFs (SPDR Gold Trust, iShares and ETF Securities) at the end of 2009 held 1,222 tonnes, 2.6 times the holdings of the five European gold ETFs (ETF Securities, ZKB, Gold Bullion Securities – now owned by ETF Securities – Julius Bauer, and Xetra-Gold). In silver, the two US funds (BGI iShares and ETF Securities) hold 9,800t, 3.8 times the holdings of the two European (ZKB and ETF Securities).

If we assume the PGM ETFs do as well relative to their European cousins as the US gold ones have, say an average ratio of 3.2, it would suggest the US ETFs should eventually accumulate 2.2 Moz of platinum and 4 Moz of palladium. Given that annual supply/demand for both metals is around 7 Moz, these are big numbers. But there are reasons to think such estimates are too high. In silver the BGI iShares ETF enjoyed first-mover advantage, being launched a year before the two European ETFs. The ratio in the period all three have been launched has been a smaller, 2.1 times. In gold there was a UK ETF before the US ETF, but the Swiss/German ETFs post-date it, and in 2009 the ratio of inflows was a lower, 2.2 times. Furthermore, in gold there are ETFs outside Europe, which is not the case in PGMs; if we include their offtake over the year the ratio of US/rest of the world is a slightly lower 1.9. Using this ratio we might expect the US fund to eventually hold 1.35 Moz of platinum and 2.3 Moz of palladium.

This is supported by another method of estimating likely US PGM demand, by studying the most successful investment/speculative products that are currently available in the US for all four metals, the futures’ markets on Nymex and Comex. The most obvious measures of size for those markets are open interest – the number of contracts outstanding – or the non-commercial net long position, the standard measure of speculative interest. In terms of ounces, platinum is the smallest, both in terms of open interest and in terms of non-commercial net long. Palladium has volumes 1.4 to 1.5 times bigger, reasonably similar to the ratio of the two PGMs’ ETF holdings (1.7). Gold is between 30 and 45 times larger; silver is between 243 and 564 times bigger.

If we average the two ratios and assume that was to pertain between the US platinum ETF and the existing US gold ETFs, which have 39.2 Moz, then it would imply that the US platinum ETF should see overtake of 1.1 Moz and the palladium ETF 1.5 Moz. If we use the US silver ETFs, which have 31.5 Moz, it would imply 780,554 oz in the platinum ETF and 1.1 Moz in the palladium ETF. This is a lower projection for the PGM ETFs than obtained by our first method of extrapolating from the current European PGM ETFs.

There is a good reason why our first method might overstate likely offtake. US investors can already purchase the UK and Swiss ETFs. Both products have been around for more than two and a half years, giving ample time for investors to become aware of them. So although the ratio of likely US demand to European demand might indeed be about two, some of the likely US demand might have already been satisfied by the European ETFs. Indeed, at the extreme all US demand might be satisfied by the European ETFs; in which case the only impact of the US launch would be in each product’s market share. However this is not that likely – instead we expect the US PGM ETFs will expand the market, for this is what happened in gold. The first gold ETFs were not in the US but Australia and the UK, and these had acquired 57t (50 in the UK, 7 in Australia) by the end of October 2004. In November 2005 the US SPDR ETF was launched; by the end of that year it had 104t, nearly double the previous holdings of the UK/Australian ETF, which fell by just 3t to 54t.

Combining our two methods might suggest an approximation of demand for the US platinum ETF of about 0.9 Moz and for the US palladium ETF 1.2 Moz, but perhaps 200,000 oz and 300,000 oz respectively of that projected demand will already be held in the European ETFs. This might or might not be transferred over in due course, but it means global offtake will be in the order of 1.35 Moz of platinum and 2 Moz of palladium, of which half has already been satisfied. So additional demand caused by the US ETFs will be in the region of 650,000 oz of platinum and 0.9 Moz palladium. This is in essence a doubling of current ETF holdings.

MUMBAI (Commodity Online): Should investors fear a bubble in gold price? No, there is nothing to worry on gold investment and corrections in the price of gold should not be viewed as bubbles that would burst, says the World Gold Council (WGC).

Saying that gold investment demand across the world remains robust, WGC top officials said that suggestions of a gold price ‘bubble’ do not take account of gold’s market fundamentals.

“The gold price has been building steadily for nine consecutive years, ending 2009 25% higher than on 31 December 2008 at US$1087.50/oz. The PM gold fix in London on Monday 1 February, 2010 was US$1086.50/oz,” said Aram Shishmanian, Chief Executive Officer, World Gold Council.

According to him, the sustained break in gold price above the key $1000/oz level came in early September, with record highs being tested repeatedly over the remainder of 2009. “The current trading range should not be regarded as an overnight spike, but the result of a measured rise, supported by favourable and robust gold fundamentals,” he said.

Marcus Grubb, Managing Director, Investment, World Gold Council on gold demand: “Investor flows, more specifically from western markets, have provided a key means of support during the course of the credit crisis as investors sought to diversify their exposures to other assets and protect their wealth against the current ravages of the global economy as well as future market shocks. These western investor flows appear to have remained resilient even as the global economy has shown signs of recovery.

Furthermore, evidence suggests that even the more tactical elements active in the gold market are being firmly driven by positive sentiment toward gold’s fundamentals. Further price support was provided by a progressive recovery in jewellery demand after a pressured first quarter.

“The diversity in gold demand cited above is expected to continue across multiple sectors and geographies. It is this diversity which has helped insulate the precious metal from shocks impacting other assets. More tangible signs of economic recovery in the second half of 2009, especially in developing economies, also continue to provide support to the gold price”.

Aram Shishmanian said on gold supply: “Robust demand should also be viewed in the context of constrained supply. Significant drivers of the gold price were also apparent on the supply side in 2009. Traditionally, central banks have been suppliers of gold, but this is starting to change. Over the course of 2009, the market saw a structural shift in central bank reserve management as western central banks slowed gold sales and developing nations added to their gold reserves. Other factors contributing on the supply side were sizeable pockets of de-hedging activity, although most major producer hedge books have now been unwound, and a reduction in the supply of recycled gold to market from the extremely high levels seen in the first quarter of 2009″.

Other News & Articles

• COTY in Berlin
• Treasury Chief Seeks Power
• Design Panels Agree on Two Selections

The big story this week is the continued retreat in the precious metals sector and its effect on bullion-related type gold coins. While gold is down about 1 percent, silver and platinum have eroded by 6 to 7 percent and all are near the bottom of the recent trading range. Trading in this area and lack of strong investment buyer demand has hammered many of the premiums on eagles and double eagles of the generic variety. So far there has been little to no effect on better date issues.

Circulated common date Morgan and Peace dollars remain firm at recent levels due to promotional demand and tight supplies. There has been some minor softening in lower grade S-mint Peace dollars starting with the 1924-S followed by the 1927-S and 1928-S with the 1934-S bringing up the rear. With the exception of 1928-S, only the VG to Fine show decreases, typical of the grades that set promoters buy for their mass marketing programs.

While there has been little price change noted, both varieties of the 1879-CC Morgan are showing strong activity. Also the 1889-CC has advanced in MS-60 through MS-63 and was joined by the 1884-S. ably a good buy.

Proof sets and mint sets remain active and demand lead by the 2008 issues is healthy.

By Allen Rowe

Counterfeit coins have been around almost as long as coins themselves. In the early years most coins were only worth as much as the metal they were made of, so fakes were relegated to copies made with inferior metal to the original.

Today coins are worth more than their metal value, so fakes are more lucrative to a counterfeiter.

Counterfeiters have several different ways of making fakes. They can alter the date or mint mark, splice two coins together, or just make the coin themselves. Coin grading companies have stopped a large part of these fakes, but now they are becoming targets themselves.

The reason for writing this article is that lately there has been a rash of counterfeits coming into the market. Most of these counterfeits are coming out of China and through popular online auction sites. I have just returned from the Florida United Numismatics convention in Orlando, one of the largest trade shows in the country, where I was privileged enough to look at some of the new counterfeits coming out of China.

For years the wave of fakes and forgeries has been growing and with it so are the techniques the counterfeiters are using.

At first much of what was being produced were fantasy pieces, coins that were never made with a particular date and mint mark combination. From there counterfeiters went into producing low level fakes. Wrong sized or non-precious metal planchets were dead giveaways for these pieces.

But soon the counterfeiters were using precious metals and spending extra time to make them the correct size and weight. Most of these pieces were easy for experts to detect as the die characteristics were all wrong for an authentic piece. These fooled many novices, but not many experts.

Today two new threats are reaching the market. First are die-struck counterfeits where high quality fakes are being produced from laser cut dies. It takes an expert to discern these fakes. Using knowledge of minute die characteristics is the only way to ferret out these counterfeits.

Secondly counterfeiters are now targeting the grading services themselves.

Recently a batch of counterfeited certified coins hit the market. Two genuine coins were used to make one fake coin, which was then housed in a counterfeit certified holder.

The example I saw was a 1904-S Morgan dollar in a fake PCGS MS64 holder, worth about $5000 if real. The coin was really a 1904-O dollar, a $30 dollar coin, with the back shaved off paired with a 1879-S dollar, a $35 coin, with the front shaved off. The two coins were then glued together and put in a fake PCGS holder. This would fool many collectors and lower level dealers.

If you are buying coins, especially if you are buying them through the internet, be very alert to these threats. Relying on experts in the industry will help you navigate through these potentially costly traps being laid out in this newest wave of counterfeits.

• Allen Rowe is the owner of Northern Nevada Coin in Carson City.

Premiums Decline on Older Gold

Metals stocks and bullion-related coins seem to be signaling some continued weakness in gold and silver. Gold is hammering away at the lower end of its recent trading range with silver following. Thus far the $1,100 level has held. Platinum while off its high is well above recent levels on continued ETF demand.

Older U.S. eagles and double eagles have again lost premium in the most commonly traded grades and there is definite absence of any aggressive buyers in the market. High-grade and small-size issues are moderately active with some pluses and some minuses. Proof gold American Eagles are quiet with few buyers seeking them at current levels. Proof silver Eagles remain strong and business strike 2010 issues have come down in premium slightly in anticipation of large shipments available next week (about when you receive this issue). Demand remains strong for all silver-related bullion issues.

Type coins remain active with very optimistic reports regarding Seated issues of all denominations with special emphasis on scarcer dates and by variety. There is a continued scarcity of all better date Barber issues especially in grades F-12 to EF-40.

Aggressive buyers go for half cents, large cents and three cents with emphasis on the tiny silver issues, which in my opinion are much underpriced in VF to EF grades.

Historic Hoards Echo in Population Reports

There have always been some mixed emotions when it comes to hoards. It’s probably natural if you are a collector or dealer to have a concern about hoards and the possibility that one might appear and cause a sharp decline in the price of a coin you own.

The classic instance of that happening occurred to collectors owning 1903-O Morgan dollars back in 1962. They thought that they had a $1,500 coin only to see it fall to $15 seemingly overnight as hundreds of thousands of examples were released by the Treasury.

It would be hard to convince them that hoards are good.

On the other side of the matter, there is the very real fact that a hoard can make a certain coin much more available and at a much more reasonable price than was previously the case. This allows many collectors who otherwise would never have owned something to be able to acquire it.

The discovery of roughly 5,400 examples of the 1857-S Coronet Head double eagle on the sunken wreck of the S.S. Central America made not only the date available, but it also made it possible for many to have a chance to have a Mint State Coronet Head double eagle and one that was produced from the early days of the San Francisco Mint.

Without that recovery of 5,400 examples of the 1857-S from their underwater resting place, the possibilities of owning a nice Mint State double eagle from San Francisco in the 1850s would definitely be reduced and that is just one of many examples.

The discovery, promotion and original sale of hoard coins is just one part of the story. That may be the most exciting part of the story, but after the hoard coins are dispersed, how well do they really hold up in terms of price? In fact, there may be no single answer for the simple reason that there are literally hundreds, if not thousands of hoard coins.

In many cases, we simply do not have a name and story to attach to the numbers of one issue or another that are known today. That is especially true in the case of gold where hundreds and in a few cases even thousands of Mint State coins returned to the United States from primarily European bank vaults in the past half century.

There was no accounting of the numbers, but when you check the numbers seen at grading services today there is absolutely no doubt that there were substantial numbers.

Even in the cases where we know of specific hoards and likely numbers involved, it is unfair to expect that each and every hoard coin will show similar price movements. After all, they are part of a set and a set of large cents is not likely to move in price at the same rate as double eagles or silver dollars or Jefferson nickels. Consequently, we cannot really expect uniform results. That said, there is still a certain question as to just how well hoard coins have done in recent years, not when compared with each other, but perhaps when compared to other non-hoard dates of the same type.

One of the most famous hoards of all was the Randall Hoard. If you have collected large cents for more than three hours you have probably heard of the Randall Hoard. The story may not be quite in tune with the reality, but the fact remains that sometime in the late 1860s in Georgia there was a discovery of a significant number of large cents allegedly in a keg. The precise dates were debated as were an assortment of issues and the story over the years has evolved slightly but we have very solid evidence that five dates were found in some numbers in Mint State in the Randall Hoard.

The two most heavily represented dates were the 1818 and the 1820, with lesser numbers of the 1816, 1817 and 1819. We can say that with some certainty as the numbers of Mint State examples of the dates found at the grading services showed the 1818 having been seen 296 times at the Professional Coin Grading Service and 288 times at Numismatic Guaranty Corp. in Mint State, while the 1820 was seen 267 times at PCGS and 391 times at NGC. In comparison, the lowest numbers for any of the five dates were posted by the 1819, which appeared 81 times at each service. In the case of a date with a similar mintage from the period the combined total at the grading services was basically under 50.

Clearly the 1818 and 1820 are available in significantly higher numbers. Back in 1998 in MS-60 the 1818 was priced at $250 while the 1820 was $275. Today, in the same grade, the 1818 is $270 and the 1820 is at $300. It would appear that the dates are not doing well except for the fact that the large cents of the period in general have moved very little. The 1816 for example was $420 in 1998 and still is $420. Other dates have increased and usually more than the 1818 and 1820, so while perhaps increasing in price at a below average pace, it would be hard to say that the Randall Hoard dates are very different from other dates of the type.

The 1857-S double eagle found in such large numbers on the S.S. Central America, which sank in 1857 off the North Carolina coast, certainly has to be seen as an extreme test in terms of double eagles. It is not simply a case where the numbers are large, but it is also a case where the S.S. Central America is a relatively recent hoard.

The market has had very little time to really absorb what was over $100 million in sales. It is probably too early to expect the 1857-S, which was basically an available date in circulated grades but not a readily available date in Mint State, to show any signs of price increases. In fact, with very serious doubts that there are even 5,400 collectors of Mint State Coronet Head double eagles to absorb the supply, it would not be at all out of the question to expect the 1857-S to show some potentially serious price declines.

If you check the prices for the 1857-S back in 1998 in MS-60 it listed for $2,600 while an MS-63 was $10,000 with no price listed in higher grades. Today in MS-60 the 1857-S is at $4,500 while an MS-65 is at $7,250. It’s a very interesting situation and a somewhat volatile one as prices are all over the board depending on the price guide. The consensus, however, is that in MS-60 the 1857-S seems to have increased in price perhaps as publicity over the sale of the S.S. Central America coins encouraged some to want to acquire a lower cost example of a famous date.

The price decline in MS-63 may well be a case of this grade was actually hurt because there were suddenly significant numbers of higher grade examples. It is definitely an opposite trend from other Coronet Head double eagle dates. The question for the next few years is likely to be not what happens to the MS-60 or MS-63 prices, but rather how does an MS-65 or MS-66 fare at their current levels.

Another recent double eagle was one involving Saint-Gaudens double eagles. Called the Wells Fargo Hoard, the hoard involved 19,900 examples of the 1908 no motto double eagle. The number was extraordinary and so was the quality of the coins. The breakdown given to Q. David Bowers for his book A Guide Book of Double Eagle Gold Coins by Ron Gillio, who purchased the hoard, had 6,000+ in MS-66 with 1,700+ in MS-67.

These high grades were not just wishful thinking by the person buying the hoard. The coins have gone through the major grading services with stunning results. At PCGS, 793 Wells Fargo hoard coins were called MS-67 compared to 38 that were not from the hoard.

At NGC the number of Wells Fargo MS-67 coins was 941 compared to 94 not from the hoard. There were similar numbers in other high grades. The impact of so many top quality examples of a single date almost had to have an impact.

The MS-65 listing of the no motto 1908 back in 1998 was $1,350 and today in MS-65 the price is $2,350. This is the cheapest of the “No Motto” type.

If MS-65 were the top grade available, then there would be considerable pressure on buyers to find and buy an MS-65. The Wells Fargo Hoard, however, has made MS-65 an average grade for this one date. Combined NGC and PCGS have graded over 6,400 Wells Fargo coins as MS-66 and 1,700 more as MS-67. Under the circumstances, buyers will seek those upper grades and not the MS-65 so there are more than just numbers potentially working against the MS-65 price of the “No Motto” 1908.

A dramatically different situation involving gold coins would be the gold dollars of 1879, 1880 and 1881. The three were low mintage, with the 1879 having a mintage of 3,030 while the 1880 was just 1,636 and the 1881 was 7,707. The three should have all been tough dates, but back at the time they were released someone saved examples. In fact. they saved hundreds of each.

We can see evidence in hundreds of each in Mint State reported by both PCGS and NGC. The hoards of the three were not all that well known, although it is a case where relatively few study and collect gold dollars. While we do not know the details of the hoard, we know that hundreds of each of the three dates are known and the MS-60 price of the three back in 1998 saw the 1879 at $700 while the 1880 and 1881 were each at $400. Today in MS-60 the 1879 is $525, the 1880 is $425 and the 1881 is $410.

There is simply no good way to make sense of that change. Ironically, the 1879 which declined the most in price is the least often seen of the three in highest grades, while the 1881 which actually increased in price in the highest Mint State grades has been graded more often than either of the other dates. There is no good way of explaining the changes, but every so often strange things happen in the market and this would have to qualify as one of those times.

If there is such a thing as a blue chip hoard coin, it is ironically a pattern as the 1856 Flying Eagle cent could not have been a coin even though it circulated simply because the law authorizing the Flying Eagle cent was passed in 1857. Over the years, few coins have been hoarded like the 1856, which seemed to always inspire speculation or at minimum a hoarding instinct.

George Rice of Detroit probably won the prize for the largest hoard of the 1856 with his accumulation numbered 756 pieces while close behind was John Andrew Beck of Pittsburgh, whose total included some from the Rice collection, reached 531.

In the case of the 1856 the numbers are small, but the percentage of the total mintage is large. Produced both in proof and also with a small number of business strikes there is no certainty regarding the 1856 mintage although perhaps 1,500 to 2,500 pieces would be a good range. Back in 1998 the 1856 was at $4,000 in G-4 and today that price is $6,250. In MS-65, the 1998 price was $21,000 and today that price is $65,000. Clearly as hoard coins go, the 1856 Flying Eagle cent continues to defy the other patterns by surging strongly to higher prices and in all grades.

There was a great deal of hoarding during the Civil War and some of that even reached down to copper-nickel cents. As a result, small groups of the copper-nickel cent dates have been reported over the years. The largest was discussed by Q. David Bowers in his book American Coin Treasures and Hoards” The group of probably 1,000 Mint State specimens of the 1862 was offered in a Thomas Elder auction in 1918. The group was significant based on the fact that PCGS has seen about 675 Mint State examples of the 1862 while NGC is at roughly 850. The 1998 prices for the 1862 in Mint State were $80 for an MS-60 and $575 for an MS-65. Today those listings are the same for an MS-60 but $1,050 for an MS-65. For a hoard coin that is not heavily publicized, that’s a strong MS-65 increase, although in reality it reflects a general increase in copper-nickel Indian cents prices in MS-65 as all dates have done basically the same thing in terms of price.

One of the more interesting dates that was heavily hoarded was the 1883 without “CENTS” Liberty Head nickel. No particular hoard can be discussed although groups of 100 or more were known. The 1883 without “CENTS” was simply hoarded by many as a new design. It was an unusual time for hoarding, but people then also hoarded the last couple years of the Shield nickel series. We see the proof in the fact that there are thousands of Mint State 1883 without “CENTS” nickels reported at the grading services and that produced 1998 prices of $32 in MS-60 and $300 in MS-65. Today those prices are $25 in MS-60 and $260 in MS-65, so clearly the extremely large numbers reported by the grading services are keeping the price down.

In his book, Bowers reports on the mysterious appearance on the market of hundreds of Mint State 1877-CC quarters in Mint State. It was an odd situation as traditionally there was very little saving of new coins at Carson City and even if there had been, the 1877-CC quarter with a mintage of nearly 4.2 million would have been an odd choice. That said, the observation of Bowers is supported by grading service totals, which show hundreds of examples of the 1877-CC in Mint State.

Since 1998, the 1877-CC which was at $375 in MS-60 has dropped to $325. Interestingly enough, that is still a premium over the most available Mint State Seated Liberty quarter dates of the type. Realistically the 1877-CC is one of those most available dates, but it happens to have a “CC” mintmark, which may be the only thing stopping it from further declines.

There is no doubt there have been a few Lincoln cents that were hoarded. It was reported that John Zug had some 25,000 examples of the 1909-S VDB, although that hoard was allegedly broken up before 1920. There were at least 10 or more rolls that hit the market in the 1950s, but the demand for the 1909-S VDB is so great that such numbers were drops in the bucket when it came to meeting demand.

Since 1998 the 1909-S VDB has gone from $720 in MS-60 and $1,800 in MS-65 to a current $1,825 in MS-60 and $6,850 in MS-65, proving that with enough demand no hoard can keep prices from rising. The situation with the Philadelphia 1909 VDB is slightly different. Its total numbers hoarded were much, much larger. There is solid demand for the 1909 VDB, also. Its 1998 prices of $9 in MS-60 and $39 in MS-65, respectively, have risen to $25 in MS-60 and $195 in MS-65.

A final Lincoln cent worth noting is the 1931-S. With a mintage below 1 million we know the 1931-S was hoarded. We can dispute the numbers hoarded with a Walter Breen claim that the Maurice Scharlack hoard had 200,000 pieces, which would have been about 25 percent of the entire mintage, but there is no doubt the 1931-S was heavily hoarded in Mint State and upper circulated grades. Since 1998 in Mint State the 1931-S has moved from $53 in MS-60 and $215 in MS-65 to a current $163 in MS-60 and $685 in MS-65.

Probably the most famous hoard coin of all time would be the 1950-D Jefferson nickel. We frankly do not know what percentage of its 2,630,030 mintage was hoarded initially, but somewhere on the order of 50 percent or more would be in the ballpark. A.J. Mitula of Houston, Texas, reportedly had 1 million pieces while another 320,000 were reported in Wisconsin and there were others with larger numbers involved.

The 1950-D soared in price during the 1950s and 1960s probably in part because all were tied up in hoards. Then it simply went into a coma, not moving for decades. In 1998 the 1950-D was $6.50 in MS-60 and $9.50 in MS-65. Today it sits at $18 in MS-60 and $30 in MS-65.

It is certainly a mixed bag when it comes to prices of hoard coins. Greater numbers should hold prices down, but a good story or heavy demand for the whole series can still lift prices higher.

CC Morgan Dollars

By thenevadamint

Morgan Coins & CC Morgans Investments

Morgan coins, morgan silver dollars, and cc morgans, despite all odds, have become a very popular and very solid investment you may want to consider – appreciating an average of 7 to 15% annual appreciation rate or more!

Morgan Coins – a Quick History

The first cc morgan coin was minted in Carson City in 1878 following the passage of the Bland-Alison Act requiring the US Treasury buy million of ounces of silver per month due to the mass amounts of silver coming out of the great Comstock Lode. Of course the Treasure had to so something with all this silver so it went on to strike over a half billion morgan coins, cc morgans, liberty heads and morgan silver dollars between 1878 and 1904 – with a last run in 1921.

Making $$$ with Morgan Coins & CC Morgans

When the cc morgan silver dollar first came out it was nick-named the “Buzzard Dollar” because the eagle looked grainy and it wasn’t very popular. So over the years millions upon millions of cc morgans were melted down – leaving limited quanities – and making for the perfect coin investment opportunity.

One coin analyst predicts the cc morgan silver dollars poised to increase the most in value in the next few years are the 1895 cc morgan, 1892-cc morgan, 1894 morgan coin, 1878-CC, and the 1883-CC. And if history is any indication, you can expect these rare cc morgan coins (especially the very popular carson city coins) to appreciate an average of 7 to 15% per year or more!

These five morgan coins have demonstrated over the years the strongest gains over a long period of time. And it is for this reason that you can expect these same coins to show a similar increase in value in the future IF you invest in MS-65 uncirculated quality or better.

Invest Only in High Grade CC Morgan Coins

Invest only what you can afford, but make it a point to only invest in the highest grade cc coins specimens. If you can afford to buy proof morgans, you should, because those have performed exceptionally well over the last fifteen years. The next best investments are the very high uncirculated MS-65 or better. Of course these high grade morgan dollars are pricey compared to MS-60 to MS-63, but their rarity virtually guarantees to make them a very good, high ROI investment.

Buy CC Morgans from a Reputable Source

Before you rush off to invest your hard-earned money in a MS-65 cc morgan, keep in mind not all dealers use the same grading standards and it is very much a “buy beware” situation. Only purchase cc coins that have been graded by a top-tier grading and that come in a top-tier grading service holder. Avoid all third-tier services like the plague.

• Top Tier – PCGS and NGC
• Second Tier – ANACS and ICG
• Third Tier – All others, including ACG, INB, NTC, PCI, SEGS, SGS, etc.

Bottom line: Morgan coins and cc coins which are in PCGS and NGC slabs or holder are worth much more than coins in slabs from any of the other minor grading services, because PCGS and NGC have consistent, exacting, and largely non-subjective standards for grading.

Buy CC Morgan Coins on eBay

So what are you waiting for? Venture on over to eBay and find yourself a cc morgan silver dollar treasure today because we’re talking money in the bank!

January 25, 2010: US Mint Coin Production, Predictions on Gold, Rare Coin Market

January 25th, 2010

Welcome to Coin Update!

We provide a round up of the latest news and articles on coins and coin collecting from various sources around the internet! First, the decline in US Mint circulating coin shipments and seigniorage for the latest fiscal year. Also, the first 2010 Lincoln Cents reach circulation channels, predictions on 2010 coins and metals, America the Beautiful Quarters obverse, pictures of gold,  SS Central America gold coins and ingots, today’s rare coin market, and notable auctions. On to the links…

An examination of the steep decline in shipments of US Mint circulating coins for the 2009 fiscal year and the unit costs to produce each denomination.

The first 2010 Lincoln Cents have been encountered in circulation. This comes ahead of the official launch ceremony scheduled for February 11, 2010.

The latest installment of survey results from the Mint News Blog survey. Respondents provided predictions on 2010 coins and precious metals performance. The average prediction for the closing price of gold at the end of the year was $1,375,13.

For a more pessimistic view of gold, check out this Huffington Post article, which makes the case for lower gold prices.

A response to an article that was linked to last week, which explained that the CCAC backed down from a recommendation to put Theodore Roosevelt on America the Beautiful Quarters due to a lack of support from Congress.

Value trends for gold coins and ingots recovered from the SS Central America.

A collection of 37 photographs of people searching for, mining, rediscovering, celebrating, buying and selling gold. (Found via coinflation.)

Some perspectives on the size and scope of today’s rare coin market.

Coverage of the recent sale of the 1913 Liberty Nickel from the Sacramento Bee that starts out with some comparisons about how kids collected coins in years past and today.

And now for some notable auctions. Several eBay sellers have new Lincoln “Union Shield” Cents already in hand. Here are the current auctions for 2010 Lincoln Cent Rolls.

Next, the 2009 P & D SMS Bronze Lincoln Cent 8 Coin Set. This is one of numerous no reserve auctions from Modern Coin Mart this week.

Last, the popular 1918 Illinois Centennial Half Dollar, which depicts Abraham Lincoln on the obverse.

That wraps up another update!

Eagle Stampede or Last Gasp for Buyers?

The U.S. Mint had a good day of sales when the 2010 gold and silver American Eagles became available to the authorized distributors Jan. 19.

Buyers snapped up 2,440,000 silver American Eagles.

Gold American Eagle buyers took 49,000 of the one-ounce coins, only these were divided between old and new dates. The 2010 coins totaled 30,500 and the 2009 total was 18,500.

For a single day, these numbers are huge. Compared to final mintages for last year, they are tiny.

Trying to figure out where we go from here and whether we will get the proof versions back in 2010 and even the “W” mintmarked uncirculated version is basically a bet on whether you believe the Mint will be able to get ahead of the demand curve in the present 12-month period called 2010.

The Austrian Mint, no slouch in the world bullion coin market, said some weeks ago that demand for its gold coins would fall by 30 percent. A similar fall in gold American Eagles would take the 1,386,000 mintage of the 2009 gold Eagles down below a million pieces to 970,200. That would leave more than enough planchets available for any and all collector versions.

A demand decline would also allow the early return to the market of fractional gold American Eagles. In 2009 the market had to wait until December to get them.

Can demand for the silver American Eagles top the 2009 total of 29,134,000 coins?

There is little U.S. historical precedent from which to make a judgment. Look back at the mintages of the 1921 Morgans and 1922 and 1923 Peace dollars and you see mintage numbers of the same order of magnitude.

However, demand for silver dollars then was officially induced as they were replacements for the 270 million coins that were melted under the terms of the 1918 Pittman Act. The Treasury needed them to back Silver Certificates.

By 1928 the official demand ended and Peace dollar mintages were suspended until the economically unsettled years of 1934 and 1935 when President Franklin Roosevelt was trying any and every means to get the economy rolling.

Instead of a renaissance, the 1930s Peace dollar mintages were the last until an abortive 1964 attempt to revive them.

As with gold, any decline in silver Eagle demand in 2010 would hasten the return of the proof and the “W” uncirculated versions this year.

Once collectors have gotten used to the gap in their silver Eagle proof sets where the 2009 coins should be, they likely will climb back on the bandwagon and buy proofs at levels similar to or even higher than before.

Collectors who feel deprived of something often buy in greater numbers at their next opportunity. That could mean loads of silver proof Eagles in 2010.

So back to the results of Jan. 19: however you interpret the numbers, the salient fact is the Mint has generated sales of approximately $100 million in one day. That boggles my mind as I recall 1968 annual proof set sales of just $15 million.