It happened again. For the umpteenth time in the past few years, the value of gold hit a new high. Last week gold climbed toward $2,700 per ounce. That means everything from wedding rings, jewelry and, of course, gold coins became quantifiably more valuable.
In 1980, gold briefly soared to then-stratospheric price of $850 per ounce. According to those who calculate such things, that would translate to around $3,200 today. Maybe. But, in actual paper dollars, it’s never been higher....
One thing that has changed are the legions of soothsayers proclaiming where the price “is sure” to go next. In 1980, those pundits and/or gold sellers were excitedly claiming the metal would soon hit $2,500. They were right. It took 43 years but it did. (Their definition of “soon” may be a bit skewed.) These days, fewer psychics are declaring gold will soon skyrocket to $5,000 an ounce or whatever price they want to predict.
Silver too has climbed. As recently as 2003, it was selling for around $4 per ounce. Today, it’s over $32. In 1980, it climbed to the $50 level. It may be headed that way once more.
Something else has again happened. Another massive hurricane hit Florida and the southeast. Hurricane Helene, a Category 4 hurricane, slammed the Florida Keys, Tampa, Jacksonville and the Florida Gulf coast.
The destructive power of these Caribbean typhoons is epic. Upwards of 200 mph winds. Especially on the Florida shoreline, homes, ships and shops can be destroyed in a matter of hours.
It’s nothing new. For humans, storms have been wreaking havoc for over 300 years. The Spanish know that all too well. In 1715 and again in 1733, off Florida, Spain lost dozens of ships carrying riches of gold and silver they had taken from their incursion into Mexico. In total, the Culture Ministry of Spain has declared 681 of their vessels sunk between 1492 and 1898. That’s a lot of treasure.
Notable ships such as the Atocha found and salvaged by treasure hunter Mel Fisher are the thing of dreams. The recently found ship San Jose, sunk in 1708, is said to contain upwards of $20 billion in gold and silver. Not surprisingly, it’s already a matter for the courts and greedy lawyers.
Although destructive, hurricanes offer residents and visitors to Florida unique opportunities to garner wealth – particularly with precious metals prices continuing to climb. That’s because the winds and surf of the storms regularly wash that Spanish treasure of pieces of eight and gold doubloons onto Florida beaches. It is common to see many individuals with metal detectors walking the beaches after major gales.
Among their finds are Spanish pieces of eight. Also known as “cobs,” these hand-struck coins were the primary mode of trade dating back to the 1600s. Containing roughly 4/5-ounce of silver they were a precursor to American dollars. That weight would translate to a current silver value of about $25. Naturally, their numismatic value is much higher. Depending on condition, or if the silver coin is certified to having come from a treasure ship, the value could be between $400 and $2,000.
As for gold doubloons, the sky is literally the limit. Think anywhere between $2,000 to $100,000 for a modest two-escudo or larger eight-escudo gold piece.
Naturally, buyer beware are key watchwords. In addition to innocent reproductions sold as souvenirs for kids, excellent counterfeits are abundant. Many come from skilled forgers in China who are well known to create bogus US coin rarities. They do their very best to blend them into the rare coin market. Fortunately, skilled authenticators can tell the difference.
There’s another potential downside to the rapid run-up in precious metal prices. As the value of silver and gold goes up, the propensity for people to sell possessions made from those metals also increases. It happened in the early 1980s. People lined up to get in the door of coin dealers to sell their family’s flatware, jewelry, coins and other items.
The possibility for many scarce or rare-date coins to be accidentally turned in and melted in order to cash in on their precious metal value is real. It began in the mid-1960s when the US switched from silver to clad coinage. Again, it was common when silver prices soared in the 1980s. Similar to so many Spanish ships, countless untold rarities were lost.
As always, the key is to know what you have and what it’s worth. Sometimes it takes a storm to make that happen.
For more collecting information and advice, log on to: http://prexford.com/.