|GOLD MARKET VALIDATES MY PREDICTION
It’s always gratifying when one’s predictions come true—even if you’re premature by a few months. When my book, Profit from Gold and Rare Coins Now came out last year, I declared that gold values were at a low level for the current cycle. I reiterated that message this January when gold prices tested $1050/oz.
As I write this gold is up almost 20% since that prediction at the beginning of the year!
MY SUPRISING NEW PREDICTION ON GOLD
I do not advise my clients to speculate and I really am not a “gold bug”. I’m just a rare coin dealer who offers my experience and observation to those who wish to diversify and invest in hard assets including gold (or silver) and rare coins as a store of value, long term appreciation, privacy and to create a legacy for you and your heirs.
Since gold coins are a component of that philosophy, we provide them to our good rare coin clients as a service at virtually no profit to us. These bullion and generic numismatic gold coins provide a great store of value, are private and are easily divided and handed down to future generations.
But bullion gold coins are not rare nor do they provide as good of long term appreciation of investment quality rare coins.
Last year I believed that timing could not be much better if you just wanted gold bullion related coins such as American Eagles. Gold prices increased by almost 20% to $1,260/oz and have now backed off a bit. The Fed’s resistance to raise interest rates further while the economy is still not robust, the worldwide economic uncertainty including China’s economy, and our own domestic political situation (Hillary v. The Donald) had a lot to do with this price increase.
What did not have much of an influence in this rise is the threat of inflation – which we believe is inevitable but not imminent.
It is because of this that we do not believe gold values much over $1300 is sustainable in the near future.
So when gold rises above that, I would reduce your purchases. This is contrary to a number of pundits and you certainly won’t get this advice from most all gold bugs!
On the other hand, if you still wish to make a gold play, generic gold premiums (as we predicted) have lagged behind and you can now acquire Gem quality independently PCGS certified MS-65 $20 St. Gaudens gold coins—(fewer than 300 can be purchased in one day and probably fewer than 500 in a week!)—for just 30% over melt! That’s ridiculously cheap. And supplies are shrinking!
We believe that these premiums over melt for such generic gold coins are at or very close to a long term low, and you should get your allocation now. (Just email us and we will send you a 13 year Coin Premium Analysis chart).
INVESTMENT QUALITY RARE COINS STILL NEAR CYCLICAL LOWS
Although the amount of coin sales have generally been at cyclical (over the last 8 years) low levels, trading for investment quality rare coins have incrementally increased. Even for great rarities.
As a case in point we reported in January that we purchased (for a bargain price at auction for $211k) one of just five known specimens of the famous “copper” 1943-S Penny (all others were struck in steel with zinc coating since copper were being used for the war effort) . We were set to promote the coin at the annual ANA National Money Show in Dallas, but sold it while on the way to the show for a fair profit.
There are a number of serious buyers in this market for nice, original and rare coins at current prices.
Activity from both collectors and especially investors have picked up significantly. Of course it didn’t hurt that the gold bullion market had increased by 20%, but many new investors are telling us that they recognize that rare coins, especially at these levels, represent not only a great store of value but their best opportunity to create wealth over the next several years. Evidently most traditional investments do not seem all that attractive right now.
And we have been able to find some great opportunities for our clients! Check out our web site, for our latest selection.
Many of our colleagues are echoing what we have been saying for the last year—that 2016 will be a good year for rare coin appreciation…
Feel free to contact me personally about a particular coin or building a personalized portfolio at or 415-435-2601
Don Kagin Popular sources: https://www.eduessayhelper.org/ they are written for a general audience by writers who are not?