Gold Coins for FUN, I mean.... investing

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airahcaz
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Gold Coins for FUN, I mean.... investing

Post by airahcaz » Mon Jan 31, 2011 1:51 pm

I've inherited a Krugerrand from a dying great uncle, which I certainly appreciate to this day.

I'd like to buy more Gold Coins, and keep till I possibly hand down to my children, etc.

I assume the US Mint has a markup and is certainly not the cheapest, but probably the safest?

Any advice on coins versus bars?

Do they come in only 1 oz or more?
Is it hard to eventually sell something more, say 10 oz?

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DiscoBunny1979
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Post by DiscoBunny1979 » Mon Jan 31, 2011 2:11 pm

It's my impression that one should buy from a Mint because the Gold or Silver will most likely contain the metal you are buying in terms of indicating the weight and purity and Mint. Buying from a coin dealer doesn't guarantee that the coin or bar is not a fake.

The only problem with buying from the U.S. Mint (other than their mark up) is that they will continually send you promotional brochures in the mail in their direct marketing efforts unless you specificy otherwise.

I found buying from the U.S. Mint convenient and fast when they were in stock with the items I wanted. I periodically go back to their website to view pricing and notice that recently they were unable to offer Gold Eagles at any price because the gold wasn't available to make them! At the U.S. Mint of all places - they ran out! Did this mean the top of the Bull Run in Gold because everyone and their Grandma wants Gold? Maybe, maybe not.

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Re: Gold Coins for FUN, I mean.... investing

Post by tludwig23 » Mon Jan 31, 2011 2:18 pm

airahcaz wrote:I've inherited a Krugerrand from a dying great uncle, which I certainly appreciate to this day.

I'd like to buy more Gold Coins, and keep till I possibly hand down to my children, etc.

I assume the US Mint has a markup and is certainly not the cheapest, but probably the safest?

Any advice on coins versus bars?

Do they come in only 1 oz or more?
Is it hard to eventually sell something more, say 10 oz?
You can buy them many safe places. I've purchased from apmex.com in the past (and have sold to them), and have always been very happy with the service and prices.

Coins generally come in 1 oz., or fractions (1/10, 1/4, 1/2).

Bars come in all sorts of sizes.

I'd stick with coins. They are easier to buy and sell.

For all practical purposes, the 1 oz. coins (US Gold Eagle, US Gold Buffalo, Canadian Gold Maple Leaf, S.A., Krugerrand) are all the same and all trade at about the same price. You can save some money by buying in quantity.

And, the US Gold Eagles have a face value of $50. So if the price of gold ever really, really tanks, you can just use the coin as legal tender. Try doing that with a Pamp Suisse 1 oz. bar!

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tludwig23
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Post by tludwig23 » Mon Jan 31, 2011 2:27 pm

DiscoBunny1979 wrote:It's my impression that one should buy from a Mint because the Gold or Silver will most likely contain the metal you are buying in terms of indicating the weight and purity and Mint. Buying from a coin dealer doesn't guarantee that the coin or bar is not a fake.
Because gold is more dense than (most) other metals, gold coins are very difficult to fake. Platinum is more dense, but, it costs more in the first place. Uranium might work, but unless you're in with the Iranians, might be difficult to obtain. I don't know of any successful attempts to counterfeit the modern gold coins.

Large bars are another matter, as one could hollow them out and partially fill them with lead.

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Post by empb » Mon Jan 31, 2011 2:36 pm

DiscoBunny1979 wrote:I periodically go back to their website to view pricing and notice that recently they were unable to offer Gold Eagles at any price because the gold wasn't available to make them! At the U.S. Mint of all places - they ran out! Did this mean the top of the Bull Run in Gold because everyone and their Grandma wants Gold? Maybe, maybe not.
I'm not sure where they actually produce their coins. But it's often the case, when the spot price of gold falls, that physical demand in India, the Far East, etc. (generally jewelers) picks up making physical supplies tight. For example, kilobars (31.99 oz.) might go from a $.20 premium to $2.00 premium over spot with 2-3 week backlogs when the price of gold falls to a certain level. Refineries often do a round-the-clock shift when physical demand gets that high. When the price climbs, is when you see physical scrap inflows to refineries (who can make bars or your Gold Eagles) increase.

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Post by hollowcave2 » Mon Jan 31, 2011 2:47 pm

If you're interested in the gold alone, then American Eagles are the best choice IMHO. They come in different sizes and a respectable dealer could easily help you with that.

But if you're also interested in history and art associated with the coins, you would also like foreign coins and older classic US coins. Again, a good dealer could help with that.

Find a coin show near you and take a look at some common classic US gold from the late 19th century to 1932. You can pick up common dates for not much more than a modern Eagle. If you do go this path, make sure to buy only certified and encapsulated gold coins. But there's a lot of history for a modest price.

For a coin reference, you can google Coin World, one of the coin publications.

Good luck.



Steve

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Post by tludwig23 » Mon Jan 31, 2011 2:50 pm

DiscoBunny1979 wrote:
At the U.S. Mint of all places - they ran out!

Did this mean the top of the Bull Run in Gold because everyone and their Grandma wants Gold? Maybe, maybe not.
Don't worry, there are still 147,000,000 troy oz. in Fort Knox. (about $200 billion worth)

(There's even more at the Fed Reserve Bank of NY's vault in Manhattan, but it doesn't belong to the U.S.)

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Re: gold

Post by airahcaz » Mon Jan 31, 2011 2:57 pm

hollowcave2 wrote:If you're interested in the gold alone, then American Eagles are the best choice IMHO. They come in different sizes and a respectable dealer could easily help you with that.

But if you're also interested in history and art associated with the coins, you would also like foreign coins and older classic US coins. Again, a good dealer could help with that.

Find a coin show near you and take a look at some common classic US gold from the late 19th century to 1932. You can pick up common dates for not much more than a modern Eagle. If you do go this path, make sure to buy only certified and encapsulated gold coins. But there's a lot of history for a modest price.

For a coin reference, you can google Coin World, one of the coin publications.

Good luck.



Steve
Well, US Mint or apmex seem to be the choices, when you say a good dealer, is that the same as saying a good diamond dealer? How can I trust a "dealer"?

This Gold ATM is interesting! http://www.suite101.com/content/gold-at ... ns-a322670

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Re: Gold Coins for FUN, I mean.... investing

Post by mptfan » Mon Jan 31, 2011 3:00 pm

tludwig23 wrote: For all practical purposes, the 1 oz. coins (US Gold Eagle, US Gold Buffalo, Canadian Gold Maple Leaf, S.A., Krugerrand) are all the same and all trade at about the same price.
True, but U.S. Gold Eagle coins have an advantage over all other gold coins from other countries--they are exempt from sales tax. This is a significant savings.

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Post by Tramper Al » Mon Jan 31, 2011 3:11 pm

You cannot buy simple bullion coins directly from the US Mint. They do, however, sell them in "uncirculated" and proof, at a higher price than the bullion value of course. Is this the "mark-up" to which you were referring?

All these government minted bullion coins do have a minted premium (over the value of the gold) built in, but that goes for buy and sell. This premium is actually quite similar (and fairly modest) among the various countries/coins when it comes to the 1 oz. Much higher on the smaller coins.

And I would think that confidence in US Mint bullion coins is a bit higher than that they most likely contain the gold they claim.

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Re: Gold Coins for FUN, I mean.... investing

Post by investorjunkie » Mon Jan 31, 2011 3:17 pm

Another one who likes APMEX and their pricing is the best I've seen on the net. For those interested, I review it on my site.

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Post by airahcaz » Mon Jan 31, 2011 3:17 pm

Tramper Al wrote:You cannot buy simple bullion coins directly from the US Mint. They do, however, sell them in "uncirculated" and proof, at a higher price than the bullion value of course. Is this the "mark-up" to which you were referring?

All these government minted bullion coins do have a minted premium (over the value of the gold) built in, but that goes for buy and sell. This premium is actually quite similar (and fairly modest) among the various countries/coins when it comes to the 1 oz. Much higher on the smaller coins.

And I would think that confidence in US Mint bullion coins is a bit higher than that they most likely contain the gold they claim.
so from a trading perspective (resale decades from now), one doesn't buy / sellthe actual bullion, correct? and what is uncirculated?

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Post by pjstack » Mon Jan 31, 2011 3:25 pm

Buy a copy of Coin World magazine. By coincidence there is an article in the Jan. 31 issue on how NOT to sell your gold (traveling roadshows, TV promoters, etc.).

Be wary of buying numismatic gold coins until you educate yourself a bit more.

Do NOT buy from televison ads. Do NOT!
pjstack

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tludwig23
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Re: Gold Coins for FUN, I mean.... investing

Post by tludwig23 » Mon Jan 31, 2011 3:27 pm

mptfan wrote:
tludwig23 wrote: For all practical purposes, the 1 oz. coins (US Gold Eagle, US Gold Buffalo, Canadian Gold Maple Leaf, S.A., Krugerrand) are all the same and all trade at about the same price.
True, but U.S. Gold Eagle coins have an advantage over all other gold coins from other countries--they are exempt from sales tax. This is a significant savings.
In my state (WA) there is no sales tax on any gold coins or bullion. Your state may vary.

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Post by HomerJ » Mon Jan 31, 2011 3:57 pm

tludwig23 wrote:Uranium might work, but unless you're in with the Iranians, might be difficult to obtain.
I heard you could buy plutonium from the Libyans if you need to generate 1.21 gigawatts... :)

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Re: gold

Post by Kenkat » Mon Jan 31, 2011 4:37 pm

airahcaz wrote:Well, US Mint or apmex seem to be the choices, when you say a good dealer, is that the same as saying a good diamond dealer? How can I trust a "dealer"?
Heritage Auctions is a reputable online dealer if you are interested in classic US gold coins:

http://coins.ha.com/

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Post by SSSS » Mon Jan 31, 2011 7:47 pm

Beware, there's a slippery slope from 1-ounce coins to 1-ounce bars to 10-ounce bars to 100-ounce bars and beyond. Set yourself a budget and be careful.

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Post by Tramper Al » Mon Jan 31, 2011 7:56 pm

airahcaz wrote:
Tramper Al wrote:You cannot buy simple bullion coins directly from the US Mint. They do, however, sell them in "uncirculated" and proof, at a higher price than the bullion value of course. Is this the "mark-up" to which you were referring?

All these government minted bullion coins do have a minted premium (over the value of the gold) built in, but that goes for buy and sell. This premium is actually quite similar (and fairly modest) among the various countries/coins when it comes to the 1 oz. Much higher on the smaller coins.

And I would think that confidence in US Mint bullion coins is a bit higher than that they most likely contain the gold they claim.
so from a trading perspective (resale decades from now), one doesn't buy / sellthe actual bullion, correct? and what is uncirculated?
Not sure what you mean by actual bullion. The 1 oz coins are a form of gold bullion, so these could/would be bought and perhaps someday sold.

These bullion coins (Eagles) don't circulate, of course. But the US Mint sells uncirculated coins of all types in plastic shells. display cases, with paperwork, etc. As such these cost more and might be expected to retain some kind of premium over the common plain coin counterpart. This is the cheapest form of gold coins you can buy directly from the Mint. Plain bullion coins contain the same gold without this collectible premium. They are distributed by the Mint to their dealer network and then trade on the secondary market from there.

What I always wanted to do (but haven't) is collect Gold Eagles from each year of issue from 1986 to present. Put them in a nice display case, or a bomb shelter, whatever. You're basically just buying the commodity, but have the fun of collecting as well.

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Post by nydad » Tue Feb 01, 2011 10:52 am

You can collect two things - gold for bullion value, or gold for its numismatics.

I prefer just the bullion, so I go for the lowest premium over spot. APMEX has a very good reputation, but also take a look around at your local jewelry/coin stores, I found a dealer who sells me gold at lower prices over spot than APMEX.

Someday I will buy a $20 gold double eagle, even though I know I'm paying a premium for the numismatics...

coinflation is a good site to help you figure out the actual melt value of the gold or silver in a given coin, and will help you compare what the markup is.

airahcaz
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Re:

Post by airahcaz » Sat Apr 07, 2012 7:43 am

Tramper Al wrote:
airahcaz wrote:
Tramper Al wrote:
What I always wanted to do (but haven't) is collect Gold Eagles from each year of issue from 1986 to present. Put them in a nice display case, or a bomb shelter, whatever. You're basically just buying the commodity, but have the fun of collecting as well.
This is exactly what I'd want to do starting in 2012 onward but cannot afford buying more than 1 coin at a time and seems like the cheapest I can do this using apmex is at least a 3% premium not accounting for shipping etc.

My assumption correct?
1) Invest you must 2) Time is your friend 3) Impulse is your enemy 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course. (Plagiarized, but worth stealing)

wellmoneyed
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Re: Gold Coins for FUN, I mean.... investing

Post by wellmoneyed » Sat Apr 07, 2012 8:23 am

airahcaz wrote:I've inherited a Krugerrand from a dying great uncle, which I certainly appreciate to this day.

I'd like to buy more Gold Coins, and keep till I possibly hand down to my children, etc.

I assume the US Mint has a markup and is certainly not the cheapest, but probably the safest?

Any advice on coins versus bars?

Do they come in only 1 oz or more?
Is it hard to eventually sell something more, say 10 oz?
I buy from kitco. I only buy 1 ounce coins. I buy silver, gold, and platinum and try to keep a coin AA of 33/33/33. I only buy when I add to vanguard and it is a fixed very small percent. I find it very easy to want to spend more. Regardless of where you buy if you are thinking about accumulating a non-trivial amount of assets I would get a coin testing kit or tool. Kitco has buyback prices on their site, so you can see what the spread is. I would only buy physical gold if you plan on holding them a LONG time. I would only buy standard 1 ounce coins, because they are easy to sell and verify authenticity. Bars are much hard to verify.

Good luck!

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Re: Re:

Post by hazlitt777 » Sat Apr 07, 2012 9:40 am

airahcaz wrote:
Tramper Al wrote:
airahcaz wrote:
Tramper Al wrote:
What I always wanted to do (but haven't) is collect Gold Eagles from each year of issue from 1986 to present. Put them in a nice display case, or a bomb shelter, whatever. You're basically just buying the commodity, but have the fun of collecting as well.
This is exactly what I'd want to do starting in 2012 onward but cannot afford buying more than 1 coin at a time and seems like the cheapest I can do this using apmex is at least a 3% premium not accounting for shipping etc.

My assumption correct?
If you buy two thousand dollars worth or more, the shipping is free from CNI www.golddealer.com. They also list their buy and sell prices so you can see the spread. They are a good firm I've worked with before. So you might want to buy two every other year.

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Re: Re:

Post by airahcaz » Sat Apr 07, 2012 10:11 am

hazlitt777 wrote:
airahcaz wrote:
Tramper Al wrote:
airahcaz wrote:
Tramper Al wrote:
What I always wanted to do (but haven't) is collect Gold Eagles from each year of issue from 1986 to present. Put them in a nice display case, or a bomb shelter, whatever. You're basically just buying the commodity, but have the fun of collecting as well.
This is exactly what I'd want to do starting in 2012 onward but cannot afford buying more than 1 coin at a time and seems like the cheapest I can do this using apmex is at least a 3% premium not accounting for shipping etc.

My assumption correct?
If you buy two thousand dollars worth or more, the shipping is free from CNI http://www.golddealer.com. They also list their buy and sell prices so you can see the spread. They are a good firm I've worked with before. So you might want to buy two every other year.
Thanks. Seems a $50 spread on a current $1650 item and hard for me to swallow paying 3%.

I suppose that's the cost of doing business but it seems so high with my Bogleheads hat on.

Btw, yes I'd hold and possibly never sell.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course. (Plagiarized, but worth stealing)

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Re:

Post by LH » Sat Apr 07, 2012 8:20 pm

Tramper Al wrote:
airahcaz wrote:
Tramper Al wrote:You cannot buy simple bullion coins directly from the US Mint. They do, however, sell them in "uncirculated" and proof, at a higher price than the bullion value of course. Is this the "mark-up" to which you were referring?

All these government minted bullion coins do have a minted premium (over the value of the gold) built in, but that goes for buy and sell. This premium is actually quite similar (and fairly modest) among the various countries/coins when it comes to the 1 oz. Much higher on the smaller coins.

And I would think that confidence in US Mint bullion coins is a bit higher than that they most likely contain the gold they claim.
so from a trading perspective (resale decades from now), one doesn't buy / sellthe actual bullion, correct? and what is uncirculated?
Not sure what you mean by actual bullion. The 1 oz coins are a form of gold bullion, so these could/would be bought and perhaps someday sold.

These bullion coins (Eagles) don't circulate, of course. But the US Mint sells uncirculated coins of all types in plastic shells. display cases, with paperwork, etc. As such these cost more and might be expected to retain some kind of premium over the common plain coin counterpart. This is the cheapest form of gold coins you can buy directly from the Mint. Plain bullion coins contain the same gold without this collectible premium. They are distributed by the Mint to their dealer network and then trade on the secondary market from there.

What I always wanted to do (but haven't) is collect Gold Eagles from each year of issue from 1986 to present. Put them in a nice display case, or a bomb shelter, whatever. You're basically just buying the commodity, but have the fun of collecting as well.
2012-1986= 26
26*1700= 44200 dollars.

Now from a certain point of view:

http://www.idahostatesman.com/2012/04/0 ... tolen.html
Safe containing $10 million stolen from LA home
44K is small potatoes.

But I would put those small potatoes in one heck of a secure display case : )

airahcaz
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Re: Gold Coins for FUN, I mean.... investing

Post by airahcaz » Sat Apr 07, 2012 8:41 pm

Is there more risk in owning a coin from another country, like the Canadian Leaf, vs. the Eagle?

Also, the US has both the Eagle and Buffalo, any real difference?
1) Invest you must 2) Time is your friend 3) Impulse is your enemy 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course. (Plagiarized, but worth stealing)

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SSSS
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Re: Gold Coins for FUN, I mean.... investing

Post by SSSS » Sun Apr 08, 2012 6:23 am

airahcaz wrote:Is there more risk in owning a coin from another country, like the Canadian Leaf, vs. the Eagle?

Also, the US has both the Eagle and Buffalo, any real difference?
Not much difference. Some bullion coins have more numismatic value than others, which isn't what you want if you want to be in the bullion market rather than the collectible coin market. The Buffalo was produced in somewhat limited quantities and is popular with collectors, so it buys and sells for somewhat more than other bullion coins, but that premium could disappear quickly in the event of a catastrophe. The somewhat ugly & extremely mass produced Krugerrand has historically had a very low premium over the price of the metal.

Bars have less of a premium than coins, but you should stick to the major manufacturers like Credit Suisse. Generic-brand bars and rounds might be problematic to sell. If it can't be authenticated, they might charge you a fee since it'll have to be melted down, examined, and recast into something more trustworthy.

To illustrate, here are some prices from APMEX showing premiums of various items:

Current gold prices -- Bid: $1,628.60 Ask: $1,630.60
1 oz Gold American Buffalo -- Bid $1,666.60 ($38) Ask $1,715.59 ($85) - Spread $47
1 oz Gold American Eagle -- Bid $1,666.60 ($38) Ask $1,710.59 ($80) - Spread $44
1 oz Gold Canadian Maple Leaf -- Bid $1,642.60 ($14) Ask $1,690.59 ($60) - Spread $46
1 oz Gold South African Krugerrand -- Bid $1,640.60 ($12) Ask $1,685.59 ($55) - Spread $43
1 oz Credit Suisse Gold Bar .9999 Fine (In Assay) -- Bid $1,633.60 ($5) Ask $1,675.59 ($45) - Spread $40

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Re: Gold Coins for FUN, I mean.... investing

Post by nisiprius » Sun Apr 08, 2012 7:26 am

Could someone who buys gold coins for "fun" try to make some estimate for me, in some way, of how much "fun" they get from the purchase, for how long, compared to other uses of the same money? Obviously I'm being a little snarky but only a little, there is a sincere component in my question. Assume that we are not talking about the great pleasure you must have derived from making what has been a very successful investment over the last ten or fifteen years, but about the differential in pleasure that you get from owning physical coins versus owning the same amount of gold in some account where it is visible only in a statement.

How much time do you actually spend looking at your coins and enjoying their beauty (and remembering that they are, after all, a mass-produced industrial artifact--no different in kind from a painting by the late Thomas Kinkade, Painter of Light®, or an .mp3 of a musical performance?)

Hypothetically, if you could obtain exactly the same financial return from an investment in GLD and in physical coins, how much extra are you willing to pay for the physical coins and what is the nature of the extra reward you get from physical ownership?

You certainly need not apologize for your personal tastes nor explain they they are different from anyone else's--it's no different from the question of why people are willing to pay thousands of dollars for pets, etc. But what is it? Something about the physical proximity of value? The fact that you can directly ascertain your ownership by viewing and touching, without having to trust any other human being's accounting?
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Re: Gold Coins for FUN, I mean.... investing

Post by airahcaz » Sun Apr 08, 2012 7:40 am

nisiprius wrote:Could someone who buys gold coins for "fun" try to make some estimate for me, in some way, of how much "fun" they get from the purchase, for how long, compared to other uses of the same money? Obviously I'm being a little snarky but only a little, there is a sincere component in my question. Assume that we are not talking about the great pleasure you must have derived from making what has been a very successful investment over the last ten or fifteen years, but about the differential in pleasure that you get from owning physical coins versus owning the same amount of gold in some account where it is visible only in a statement.

How much time do you actually spend looking at your coins and enjoying their beauty (and remembering that they are, after all, a mass-produced industrial artifact--no different in kind from a painting by the late Thomas Kinkade, Painter of Light®, or an .mp3 of a musical performance?)

Hypothetically, if you could obtain exactly the same financial return from an investment in GLD and in physical coins, how much extra are you willing to pay for the physical coins and what is the nature of the extra reward you get from physical ownership?

You certainly need not apologize for your personal tastes nor explain they they are different from anyone else's--it's no different from the question of why people are willing to pay thousands of dollars for pets, etc. But what is it? Something about the physical proximity of value? The fact that you can directly ascertain your ownership by viewing and touching, without having to trust any other human being's accounting?

Your question is precisely related to my question as the OP. As you can see I've been debating this for well over a year, and personally I couldn't answer that. I imagine that I would hold forever and have my children inherit as part of our Will ( I doubt they'd value it and would just sell it at the age of say 18). I like what my great uncle did, he handed 1 coin down to each of his niece and nephews (one being my father).

Maybe I'm also thInking that it can be kept for generations and if a coin needs to be sold here as there down the road, they'd avoid taxes (illegitimately).
1) Invest you must 2) Time is your friend 3) Impulse is your enemy 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course. (Plagiarized, but worth stealing)

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Re: Gold Coins for FUN, I mean.... investing

Post by SSSS » Sun Apr 08, 2012 6:51 pm

nisiprius wrote:Hypothetically, if you could obtain exactly the same financial return from an investment in GLD and in physical coins, how much extra are you willing to pay for the physical coins and what is the nature of the extra reward you get from physical ownership?
The "extra" you pay for physical bullion coins or bars is one-time. If you buy X ounces of bullion, in 100 years you or your heirs will still have X ounces of bullion. The amount lost to the expense ratio of a bullion ETF compounds indefinitely year after year, such that the ounces you own will gradually approach (but never quite reach) zero.

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Re: Gold Coins for FUN, I mean.... investing

Post by hazlitt777 » Sun Apr 08, 2012 7:08 pm

SSSS wrote:
nisiprius wrote:Hypothetically, if you could obtain exactly the same financial return from an investment in GLD and in physical coins, how much extra are you willing to pay for the physical coins and what is the nature of the extra reward you get from physical ownership?
The "extra" you pay for physical bullion coins or bars is one-time. If you buy X ounces of bullion, in 100 years you or your heirs will still have X ounces of bullion. The amount lost to the expense ratio of a bullion ETF compounds indefinitely year after year, such that the ounces you own will gradually approach (but never quite reach) zero.
I also consider owning bullion another way to diversify my financial assets away from an otherwise 100% paper connection to my resources, whether gold or part ownership in a company via stocks. In owning bullion, some of my wealth is tangible...directly physically held.

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Re: Gold Coins for FUN, I mean.... investing

Post by athrone » Mon Apr 09, 2012 5:34 pm

nisiprius wrote: You certainly need not apologize for your personal tastes nor explain they they are different from anyone else's--it's no different from the question of why people are willing to pay thousands of dollars for pets, etc. But what is it? Something about the physical proximity of value? The fact that you can directly ascertain your ownership by viewing and touching, without having to trust any other human being's accounting?
Why not buy a 1 oz gold coin, take it home and hold it in your hand with no one else looking, and answer the question for yourself?

airahcaz
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Re: Re:

Post by airahcaz » Mon Mar 02, 2015 7:38 am

LH wrote:
Tramper Al wrote:
airahcaz wrote:
Tramper Al wrote:You cannot buy simple bullion coins directly from the US Mint. They do, however, sell them in "uncirculated" and proof, at a higher price than the bullion value of course. Is this the "mark-up" to which you were referring?

All these government minted bullion coins do have a minted premium (over the value of the gold) built in, but that goes for buy and sell. This premium is actually quite similar (and fairly modest) among the various countries/coins when it comes to the 1 oz. Much higher on the smaller coins.

And I would think that confidence in US Mint bullion coins is a bit higher than that they most likely contain the gold they claim.
so from a trading perspective (resale decades from now), one doesn't buy / sellthe actual bullion, correct? and what is uncirculated?
Not sure what you mean by actual bullion. The 1 oz coins are a form of gold bullion, so these could/would be bought and perhaps someday sold.

These bullion coins (Eagles) don't circulate, of course. But the US Mint sells uncirculated coins of all types in plastic shells. display cases, with paperwork, etc. As such these cost more and might be expected to retain some kind of premium over the common plain coin counterpart. This is the cheapest form of gold coins you can buy directly from the Mint. Plain bullion coins contain the same gold without this collectible premium. They are distributed by the Mint to their dealer network and then trade on the secondary market from there.

What I always wanted to do (but haven't) is collect Gold Eagles from each year of issue from 1986 to present. Put them in a nice display case, or a bomb shelter, whatever. You're basically just buying the commodity, but have the fun of collecting as well.
2012-1986= 26
26*1700= 44200 dollars.

Now from a certain point of view:

http://www.idahostatesman.com/2012/04/0 ... tolen.html
Safe containing $10 million stolen from LA home
44K is small potatoes.

But I would put those small potatoes in one heck of a secure display case : )
Even a fireproof safe at home is only fireproof for a set amount of hours. Then the gold melts and...

Begs the serious question, where does one keep their gold, bank safety deposit box?
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Re: Gold Coins for FUN, I mean.... investing

Post by prudent » Mon Mar 02, 2015 9:26 am

Not that anyone wants to find out the hard way, but gold won't melt in a typical house fire of about 1200 degrees F. Whether it will be found encased in a melted and burned glob of its surroundings is another story.

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Re: Gold Coins for FUN, I mean.... investing

Post by WHL » Mon Mar 02, 2015 10:59 am

Who bumps a four year old thread, seriously?

There are extensive reviews of fireproof safes online. Given the bogleheads dim view of precious metals, this is certainly not where I would look for advise.

Finally, purchasing metals is pure speculation, not investment. Call it a hedge or whatever you want, but it is not investing.

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Re: Gold Coins for FUN, I mean.... investing

Post by airahcaz » Mon Mar 02, 2015 11:11 am

WHL wrote:Who bumps a four year old thread, seriously?

There are extensive reviews of fireproof safes online. Given the bogleheads dim view of precious metals, this is certainly not where I would look for advise.

Finally, purchasing metals is pure speculation, not investment. Call it a hedge or whatever you want, but it is not investing.
It's my thread, as OP.
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Re:

Post by nisiprius » Mon Mar 02, 2015 11:57 am

tludwig23 wrote:...Because gold is more dense than (most) other metals, gold coins are very difficult to fake. Platinum is more dense, but, it costs more in the first place. Uranium might work, but unless you're in with the Iranians, might be difficult to obtain. I don't know of any successful attempts to counterfeit the modern gold coins.

Large bars are another matter, as one could hollow them out and partially fill them with lead...
Apparently tungsten works:

Tungsten-filled gold bars are discovered in Manhattan
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Re: Re:

Post by tludwig23 » Mon Mar 02, 2015 12:27 pm

airahcaz wrote:Even a fireproof safe at home is only fireproof for a set amount of hours. Then the gold melts and...

Begs the serious question, where does one keep their gold, bank safety deposit box?
Put the coins in a fireproof ceramic bowl in the safe. If they melt you'll have a bowl of gold soup.
That's what I do: I drink, and I know things. --Tyrion Lannister

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Re: Re:

Post by airahcaz » Mon Mar 02, 2015 12:31 pm

tludwig23 wrote:
airahcaz wrote:Even a fireproof safe at home is only fireproof for a set amount of hours. Then the gold melts and...

Begs the serious question, where does one keep their gold, bank safety deposit box?
Put the coins in a fireproof ceramic bowl in the safe. If they melt you'll have a bowl of gold soup.
lol, but seriously, if it does melt, it "would" contain all the gold, right?
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Re: Re:

Post by tludwig23 » Mon Mar 02, 2015 1:41 pm

airahcaz wrote:
tludwig23 wrote:
airahcaz wrote:Even a fireproof safe at home is only fireproof for a set amount of hours. Then the gold melts and...

Begs the serious question, where does one keep their gold, bank safety deposit box?
Put the coins in a fireproof ceramic bowl in the safe. If they melt you'll have a bowl of gold soup.
lol, but seriously, if it does melt, it "would" contain all the gold, right?
Yes, but you'd have to pay someone to have it assayed in order to sell it.
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Re: Re:

Post by WHL » Mon Mar 02, 2015 2:05 pm

tludwig23 wrote:
airahcaz wrote:
tludwig23 wrote:
airahcaz wrote:Even a fireproof safe at home is only fireproof for a set amount of hours. Then the gold melts and...

Begs the serious question, where does one keep their gold, bank safety deposit box?
Put the coins in a fireproof ceramic bowl in the safe. If they melt you'll have a bowl of gold soup.
lol, but seriously, if it does melt, it "would" contain all the gold, right?
Yes, but you'd have to pay someone to have it assayed in order to sell it.
Depending on the size of the current bars that may be a true statement anyways.

I've stayed away from hand poured / loaf bars for just that reason.

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Re: Gold Coins for FUN, I mean.... investing

Post by Jack FFR1846 » Mon Mar 02, 2015 2:29 pm

Coins are made from various alloys. A krugarrand is 22 k so it is harder and wears better than for example a 24 k Canadian maple leaf. The krugarrand does have 1 troy oz of gold but a total weight of 1.09 troy oz.

Canada maple leafs are widely used as a standard.

I watch prices on apmex and the show their buy price as well.
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Re: Gold Coins for FUN, I mean.... investing

Post by airahcaz » Mon Mar 02, 2015 3:33 pm

What are the downfalls/disadvantages in buying an American Eagle every year for 30 years?

Advantages, over 30 years, is hopefully accumulating an asset that has increased in value over the very long term, diversification, etc.
For argument sake, let's say this amasses to today's spot ~$1200 x 30 years, or $36,000.

Clearly this $36,000 could have been invested in an index fund, but what if one already had a main investment portfolio, yet wanted to accumulate (close to) cash equivalent savings (short term liquidity needs aside), yet was willing to take on risk, in order to beat inflation.
1) Invest you must 2) Time is your friend 3) Impulse is your enemy 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course. (Plagiarized, but worth stealing)

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Re: Gold Coins for FUN, I mean.... investing

Post by airahcaz » Mon Mar 02, 2015 8:09 pm

I'd actually like to buy specific years for my niece and nephews, e.g. 2009.

Suggestions on best place to do so?
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Re:

Post by Stonebr » Mon Mar 02, 2015 8:20 pm

nydad wrote:You can collect two things - gold for bullion value, or gold for its numismatics.
Or both. Back when they were relatively cheap, like 10-15 years ago, I collected all the US Gold Eagles by date. Some of them are quite scarce, like the 1991 and 1992 fractionals, and now command a hefty premium over bullion price. The scarce bullion coins are often far more valuable than the "proof" coins.

One advantage of US Eagles over foreign coins is that they have value as currency. Yes, they are legal tender for all debts public and private just like paper money, and have values of $50, $25, $10, and $5. This means that even if some clever nanotechnologist comes up with a way to replicate gold out of hydrogen atoms, my Eagles will still be worth as much as paper money. :happy
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Re: Re:

Post by airahcaz » Mon Mar 02, 2015 8:32 pm

Stonebr wrote:
nydad wrote:You can collect two things - gold for bullion value, or gold for its numismatics.
Or both. Back when they were relatively cheap, like 10-15 years ago, I collected all the US Gold Eagles by date. Some of them are quite scarce, like the 1991 and 1992 fractionals, and now command a hefty premium over bullion price. The scarce bullion coins are often far more valuable than the "proof" coins.

One advantage of US Eagles over foreign coins is that they have value as currency. Yes, they are legal tender for all debts public and private just like paper money, and have values of $50, $25, $10, and $5. This means that even if some clever nanotechnologist comes up with a way to replicate gold out of hydrogen atoms, my Eagles will still be worth as much as paper money. :happy
Why were those particular years scarce vs others? I suppose it will be a rarity that any modern years would experience the same scarcity - as they're so readily available.
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Re: Re:

Post by Stonebr » Mon Mar 02, 2015 8:41 pm

airahcaz wrote:
Why were those particular years scarce vs others? I suppose it will be a rarity that any modern years would experience the same scarcity - as they're so readily available.
Demand.

When sales are slow, they don't mint as many. 2001 was another low mintage year. 1998 and 1999 were high because of the y2k craze, then when the world didn't end, the bottom fell out of the gold market.

http://goldeagleguide.com/mintages/
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Re: Gold Coins for FUN, I mean.... investing

Post by Stonebr » Mon Mar 02, 2015 8:53 pm

Notice the extremely low mintage of the 1991 1/2 ounce coin. This one is what coin collectors call the "Key date" to the series.
"have more than thou showest, | speak less than thou knowest" -- The Fool in King Lear

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Re: Gold Coins for FUN, I mean.... investing

Post by airahcaz » Mon Mar 02, 2015 8:56 pm

Stonebr wrote:Notice the extremely low mintage of the 1991 1/2 ounce coin. This one is what coin collectors call the "Key date" to the series.

Where do you make your purchases?
1) Invest you must 2) Time is your friend 3) Impulse is your enemy 4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course. (Plagiarized, but worth stealing)

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Re: Gold Coins for FUN, I mean.... investing

Post by Dulocracy » Tue Mar 03, 2015 5:22 pm

WHL wrote:Who bumps a four year old thread, seriously?

There are extensive reviews of fireproof safes online. Given the bogleheads dim view of precious metals, this is certainly not where I would look for advise.

Finally, purchasing metals is pure speculation, not investment. Call it a hedge or whatever you want, but it is not investing.
Odd. Some people complain, "If you would do a search of the website, you would see that this was already posted." Others complain when people do just that. How about we let people both post new and renew old posts?
I'm not a financial professional. Post is info only & not legal advice. No attorney-client relationship exists with reader. Scrutinize my ideas as if you spoke with a guy at a bar. I may be wrong.

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Re: Gold Coins for FUN, I mean.... investing

Post by Dulocracy » Tue Mar 03, 2015 5:27 pm

nisiprius wrote:Could someone who buys gold coins for "fun" try to make some estimate for me, in some way, of how much "fun" they get from the purchase, for how long, compared to other uses of the same money? Obviously I'm being a little snarky but only a little, there is a sincere component in my question. Assume that we are not talking about the great pleasure you must have derived from making what has been a very successful investment over the last ten or fifteen years, but about the differential in pleasure that you get from owning physical coins versus owning the same amount of gold in some account where it is visible only in a statement.

How much time do you actually spend looking at your coins and enjoying their beauty (and remembering that they are, after all, a mass-produced industrial artifact--no different in kind from a painting by the late Thomas Kinkade, Painter of Light®, or an .mp3 of a musical performance?)

Hypothetically, if you could obtain exactly the same financial return from an investment in GLD and in physical coins, how much extra are you willing to pay for the physical coins and what is the nature of the extra reward you get from physical ownership?

You certainly need not apologize for your personal tastes nor explain they they are different from anyone else's--it's no different from the question of why people are willing to pay thousands of dollars for pets, etc. But what is it? Something about the physical proximity of value? The fact that you can directly ascertain your ownership by viewing and touching, without having to trust any other human being's accounting?

I do not buy gold or silver coins as an investment, as I do not understand it well enough (I honestly have not looked into how to get the best price and whathaveyou). I DO understand the appeal of having gold and silver coins to clink together. My own glorious show of wealth. Get maybe 3 silver and 3 gold? Jingle them. Maybe add one more of each because 8 would cover the bottom of the little safe more. Maybe go up to 12 total so that they are not just on the bottom of the small safe, but stacked... Then 18 because it would look like a lot more. Of course, 24 would do a lot better. Yeah, I can see this getting dangerous for me. I completely understand the fun aspect. First, I need to be able to get my other finances situated.
I'm not a financial professional. Post is info only & not legal advice. No attorney-client relationship exists with reader. Scrutinize my ideas as if you spoke with a guy at a bar. I may be wrong.

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