Man’s Golden Progress

Gold is used in various areas as in adorning buildings or jewelry. The rarity and beauty of gold are greatly appreciated to use it as currency. As man continued its civilization and industrious progression, mining took on a higher sophistication to produce higher quality coins.

Gold as money

It is assumed that the Lydians produced the world’s first gold coins in 630 BC using an alloy of gold, silver and electrum. The progressive technology saw nations issuing gold coins on their own to reflect their own stature and sovereignty with many battling over a larger portion of possession. Ships sank and nations were plundered for more gold while others mint gold coins with different designs to signify their kingdom.
Counterfeit gold came on the scene as greed for the precious matter flourished. As the battle for gold possession intensified, a new industrialization era came on with paper money during the 1700s.

Gold as myth

The precious yellow matter holds a significant value in many societies’ belief systems. Religions have many myths and folklores that incorporate gold in special rituals. Gold is revered as an auspicious metal which is usually accorded as a gift.

The greed of man led to the emergence of Irish leprechauns and fool’s gold where not everything that glitters is gold.

Gold as industry

As technology progresses, mining techniques and grading practices kept improving to produce gold as pure as possible. The evolving technology revolutionized the coin industry although paper currency came into effect in 1933.

Gold as Investment

Gold coins are considered highly liquid assets whose value depends on weight, purity, rarity and other factors. One can own gold without a physical possession through ETFs and gold futures or gold certificates.

The coin grading process involves many factors which include authenticity, condition and sharpness.

When coins were first graded, one only considered two grades: Mint and circulated. But more grading systems have surfaced over the years as the process is refined.

Grades

A coin is graded to indicate the coin’s condition or appearance. The five main grading components used on a coin is its strike, luster, surface preservation, eye appeal and coloration.

The coin grading industry went ahead to fine tune the grading system with a letter system. The Basal State is known as poor or PO; continuing Fair is FR; Almost or About Good is AG; Good is indicated by G; Very Good condition is VG; Fine condition is F; Very Fine condition is indicated by VF; Extra Fine is EF or XF; About or Almost Uncirculated is indicated by AU; Uncirculated coins is UNC and Brilliant Uncirculated is BU.

Sheldon grading

A more precise coin grading was developed during the 19th and 20th centuries when the coin collection market grew. Dr. William H. Sheldon standardized the process of coin grading with his Sheldon Scale in 1948.

The Sheldon Scale formalizes the coin grading process with a numeric system ranging from 1 to 70. The Sheldon Scale took off to grade the 1794 Large Cent but now applies to all types of coins. A scale of 1 implies a very low grade while a scale of 70 implies perfection.

Uncirculated grades took on Mint State which is indicated by MS which starts off with a scale at MS60 and keep rising until MS70 for enhanced quality. An untrained eye would not be able to differentiate between a MS 65 and MS 68 coin. A one-point difference in any coin grade could cost the buyer or seller a difference of thousands of dollars on a coin value.

Now there are two nationally recognized coin graders who are independent third parties to assist coin buyers and sellers without the herd of diverse opinions on coin grading. Professional Coin Grading Service and the Numismatic Guarantee Corporation operate using the Sheldon Scale in grading coins.

The US minted gold coins’ sales figures for the first half of 2011 are as follows:

Gold Trading Company: Gold coins

A professional gold trading firm can serve its clients in the following manner:

There is security as well as peace of mind in owning gold. There are many options to select from. Seek the assistance of a professional and reputed gold trading company.

Value Determinants of Rare Gold Coins

The preference for rare gold coins stems from the history they contain. Hence, various determinants impact the value of any rare gold coin.

Grading

PCGS and NGC are professional third party coin graders and certification authorities on numismatic coins. Based on the coin’s appearance and quality, a certification on the coin is a mark of authenticity with an added safety measure and protection to all numismatic coin owners whether novice or experienced. A certified gold coin adds value to the coin when it is up for sale.

Rarity

The rarity of a coin enhances its value, since there are very few of these in circulation. They also mark some significant period of history which many serious coin collectors or investors want to own. There may be more common numismatic coins of lower value compared to un-circulated gold coins or rare gold coins. Many gold coin collectors are only content with something that is unique.

Historical Significance

Special gold coins, such as those which survived wars and meltdowns have a higher value. Coins that were minted to commemorate events or certain eras are also higher in value over other types of gold coins. Serious coin collectors seek to collect the complete series just to own the significance of some important historical time line.

Gold Circulation

Gold is very malleable though it has such high value, hence it can be damaged with improper handling. A small hairline scratch, which happens in circulation or transit can lower its value. Hence, un-circulated gold coins are more valuable due to their pristine condition.

Valued Additions

Gold coins accompanied by old letters, souvenirs, old notes, sales literature and original design sketches are more highly valued as these have proofs of authenticity. Hence, many auction catalogs today add to the rare coin’s value with its history in print.

It is the US Mint which sets the collector gold coin prices from the range of $1,750 to $1,799.99. Price reductions would be seen in First Spouse proof coins, 1 oz un-circulated Gold Eagle, un-circulated First Spouse gold coins, Proof Gold Eagles coins of 1/10 oz., ¼ oz., ½ oz, 1 oz. and 4-coin set as well as the 1 oz gold American Buffalo coin. It can be as low as $5 or as high as $92.50 for a price cut.

Before the new prices are implemented, the US Mint freezes all ordering of the product by late morning. The Mint may also lower the price of the Proof American Eagle Platinum gold coin by as much as US $200. No purchases are allowed during this period. More gold coins may be affected in the price cut exercise.

Commemorative Gold Coins

The US Mint also noted the lowered sales in investment gold coins recently. There were only 115,500 ounces of American Eagle bullion coins sold in September 2011 although these are the more popular US minted gold coins.

The American Buffalo bullion coins sale also decreased with 13,000 ounces of coins sold in September as compared to 28,000 ounces in August. But US minted bullion coin prices are dependent on different dealers as they are not available from the US Mint. There is no fixed weekly pricing on the US investment graded coins. These include the 24-karat American Buffalo bullion and the 22-karat gold American Eagle. Their price is slightly higher than the current gold price.

Another commemorative gold coin is the US Medal of Honor and Army coin. New pricing of these coins caused their suspension in August 15, 2011. There are many types of US minted gold coins which gold buyers can consider adding to their portfolio. However, many buyers choose US minted gold coins that have some history regardless of their nationality. A serious gold buyer should research more into the various gold options for a varied portfolio.

An economics professor commented that the gold price is driven by its exhaustible supply. It is widely accepted that gold is commonly used as an inflation hedge. Hence, gold prices rose as much as 22% in the year 2010 with a new record at $1,424.30 an ounce near the end of 2010. This happens in the midst of the decreased value of the greenback.

Developing Nations’ Growing Demand

Third world countries are demanding gold coins today; two of the main participants in this venture are China and India as there is a deep cultural significance that is related to gold, as well as the use of gold in electronic gadgets.
Gold price reached the significant 20,000 Rs per 10 gram in India but this rise does not discourage bulk purchases of gold for weddings and during festive occasions. Many make gold investments as some form of defense mechanism against the fluctuating market.

A WGC report mentioned India’s gold demand to touch $19 billion in the year 2009; this is 15% of all gold markets in the world. There is an obvious 13% increase in the demand of gold in the Indian economy in the past decade. This makes India on of the biggest gold market today in the world; there are implications to the position of gold in the gold market.

Tips to purchasing gold

Some tips in purchasing gold coins include an accurate research of the trend of gold prices. Gold prices move unpredictably; sometimes the trend can be steady while other times can showcase big jumps over a short period.
Hence, a keen investor should wait for the right opportunity to purchase gold by watching the gold price trends over a period of time to determine its patterns.

It is always the gold trader’s desire to buy low to sell at a high price for any gold purchased. However, many may hold on to get more returns thinking that the gold price may continue to rise further instead of selling off when the price has risen. Gold buyers should purchase different types of gold coins instead of just one type.

The currency value decline boosted gold investment; there was more demand for gold coins with a record currency figure. Hedge funds were also buying up more gold coins, which impacted the demand for gold. However, the US Mint seemed to experience difficulty with the gold coin production; especially the 24-karat American Buffalo gold bullion as it was the most popular gold coin at that time with the Canadian Maple Leaf.

Pricing Information

Any purchase of US gold coins must be preceded with a research on their actual value. Accurate and up-to-date information on every type of US gold coin for purchase is necessary as different gold coins have different values; for example, there are differences between the bullion gold and numismatic gold coins.
A bullion gold coin is usually purchased for hedging inflation while a numismatic gold coin adds to a growth in personal wealth over time.

Bullion gold coins are sold according to their intrinsic gold content by ounce determined by the market price whereas numismatic gold coins are sold according to their rarity, popularity, significance, grade, quality, demand and supply.

The Right Purchase Price

The right purchase price of a bullion gold coin is dependent on its intrinsic value, actual market price, manufacturing costs and other premiums. Bullion gold coins pricing is usually higher than the gold market’s pricing albeit a small margin.

Some popular bullion gold coins include the American Eagles, Canadian Maple Leaf, China Panda and the Krugerrands from South Africa.

There are several steps to follow in determining the best selling price for any preferred gold coins. Some of these include using a gram scale weight for determining the gold content; acquiring knowledge of the spot gold market; using a trusted source to help determine and evaluate the purity of gold and consider all factors of costs that are associated with gold.

It is imperative to be constantly alert to the gold market price, which can fluctuate unpredictably. Spot prices and market prices of gold can be monitored online easily today. Finally, there are many factors of consideration in determining the best or most appropriate purchase price of gold coins, which include manufacturing and distribution costs as well as dealer commissions.

On his recent television interview on the CNBC channel, Jim Rogers strongly expresses his advice for the people not to sell their gold just yet. He further proves his point by stating that gold reached an all-time high of $850 per ounce in 1980 but today it could reach $2,400 per ounce with adjustments made for inflation. Rogers also strongly believes that the price of gold will go much higher than the predicted price within the next ten years. He believes that the reason for this is that the governments of different countries all over the world are creating more money for their own economy. If the dollar has a high volume in the market then the result of this will be the decrease in its value. If the supply of the dollar is high then its value in the market will be lowered as a result. If the value of the dollar is low then the effect of this will be the increase in the value of gold.

Jim Rogers states that he does not plan on selling the gold that he owns mainly because he plans to use it as a form of insurance policy against anything that might happen to the economy. He is also against selling gold anytime soon because he believes that he will be able to earn more for his gold in about 10 to 20 years from now. Rogers also states that the Fed has already elevated the supply of money in the market and will be buying more stocks and bonds in the QE3.

During the interview, Jim Rogers was also asked why the popularity of gold has faded after the debt crises in Europe. His response to this was that he believes that gold is always inversely related to the market. He further explains that the state of gold is often the exact opposite of the state that the market is currently in. He also affirmed that gold has been able to regain its strong footing in the market together with all other forms of assets. Jim Rogers strongly declared that gold has been doing very well in the market for 11 years now and it will continue to do so in the coming years.

The crew were rudely awakened to the harsh reality of gold mining when they got to Alaska. They met a lot of trials along the way such as frozen ground and broken equipment. Add to that the fact that they had to mine really deep underground before they could reach the depth where gold could be mined. It took them several months before they even saw a tiny grain of gold. When the first season of the show ended the amateur miners were only able to dig up 14 oz. of gold. This meant that they were not able to earn any profit from all the money that they spent on their mining venture in Alaska. It also means that finding gold is not easy even if a lot of people believe that Alaska is abundant in gold.

The reason gold is very hard to find is because it is a very rare precious metal. In order to find gold, miners have to dig several hundred feet only to find a small nugget of gold. It is said that all the gold that has been mined through the years only measures up to the size of a 20-yard cube. This only shows how rare gold is and how difficult it is to mine it.

Gold may be very rare but a lot of people wish to own it. This is because gold is a store of value. A lot of people in the United States still consider gold as money even after Nixon took the country off the gold standard. The rising demand for gold has only contributed to its already high value in the market. As the demand for gold in the market increases so does its price. This only motivates a lot more people to start owning gold. The good news is that owning gold is no longer as difficult as having to travel to Alaska with truckloads of mining equipment in tow. There are now many ways of owning gold and one way to do that is by buying gold coins.