As a child of six or seven during the Cold War, I had a curious dream. My family and I were in a car driving in Berlin. Suddenly, we accidentally drove through Checkpoint Charlie to the other side of the Iron Curtain. I was sure we were to be killed. The threat of war during that era was very real and on the news each night. How a child’s mind perceived those dark times was daunting and very real. After all, we were the generation taught to “duck and cover” under our school desks.
I can only imagine how children today might be reacting to today’s allegorical “Doomsday Clock.” Last week, it was reported to have advanced another 10 seconds. By its measure, we are now “just 90 seconds from midnight.” Midnight means global annihilation/Armageddon. The clock’s measure is based on a combination of climate change and nuclear proliferation. By comparison, we were fully two minutes to midnight during at the height of the Cold War in 1963....
Recent reports about rapidly melting arctic glaciers; Russia escalating the war in Ukraine and its potential use of ‘limited” nuclear weapons; the prospect of a US military conflict with China; and the ongoing insanity of North Korea launching missiles all adds to the threat.
You might not think this would have an impact on collectors or collectibles. It does. As a species, we clamor to safe harbors during times of perceived or real crises. Historically and universally, that security has been gold. As insecurity rises, so does the price of gold.
Naturally, you can’t eat or drink gold. You can’t hide behind it or use it for shelter. None of that matters. As a result of its beauty, rarity, malleability and imperviousness to virtually anything, humans have lusted for, fought over and killed to own the gleaming metal. In coin form, gold dates back as far as coinage itself.
Even with the recent jump in gold prices – from $1,200 five years ago to $1,900 now – a variety of gold coins is comparatively affordable.
Gold coins comprise the second largest collecting area in numismatics. Thanks mainly to US silver dollars, along with pre-1964 dimes, quarters and half-dollars, silver coins make up the largest area of collecting. Because of affordability, copper pennies are of interest. Still, US gold coins from the era of the storied “Old West” and during the roaring 20s and 30s remain the second most popular.
Equally intriguing to collectors are the moderately-priced gold coins from foreign countries. Some of those include the French 20 franc; Austrian one ducat; Italian 20 lira; Russian five ruble; Mexican five peso; British sovereign; or German 20 mark. Each of those are not only interesting because of their foreign origin and design but their current price ranges from $200 to $400 apiece.
Some are even smaller. The Mexican two, and two-and-one-half peso coins weigh barely 1/20th of one ounce. Those are now valued between $75 and $100 each.
In some cultures, it is essential to own gold no matter how tiny the amount. India is a prime example. There, people regularly purchase gold in quantities as small as 1/2-gram. Because there are 32 grams in one ounce, those ingots are almost microscopic. Nevertheless, because it’s so important for Indian citizens to own gold, even poor residents buy them.
For any buyer there are three caveats. First, the smaller the gold piece, the higher the premium. Those half-gram ingots in India sell for around $50 each. You would need 64 of them to equal one ounce. That equates to $3,400 per ounce. With gold now near $1,900 per ounce, that’s a very bad deal. If possible, always buy gold in larger weights to pay less of a premium.
Second, never, ever, ever buy gold at a discount. The price of gold is the price of gold. It is never discounted. If anyone is selling gold for less than the international spot price it is fake. Period. That being said, third, shop around. Some sellers do charge more of a premium than others.
Finally, for 2023, a new variety of gold has appeared – the Britannia. From Great Britain they are the first coins bearing the portrait of King Charles. According to the Royal Mint, Britannia sales are already 25 percent higher than previous years. Pending crises, new king or whatever, people still seem to be flocking to gold.
For more collecting information and advice, log on to: http://prexford.com/.