Precious Metals Prices on Fire By Debbie Bradley,
February 28, 2008
"Should I buy or should I sell?"
That's what owners of bullion coins are asking themselves
as gold and silver prices climb higher each day.
Meanwhile, dealers are finding themselves busy doing both.
"With oil hitting over $100 a barrel, gold near $1,000
an ounce and silver near $20 an ounce, it's created a lot
of activity," said Scott Thomas, president and chief
executive officer of American Precious Metals Exchange.
Any BU $20 Saint-Gaudens gold coin, for instance, is selling
for close to $1,000.
"I think a lot of people are selling a lot of bullion
products they bought when silver was under $10 an ounce,"
Thomas said. "Here is a chance for people to double their
money." A bullion coin gets most of its value from the
metal value, while a collector coin gets most of its value
from its rarity.
"A lot of people are selling pre-1933 gold coins that
they've held on to for a while," Thomas said. "They're
Vintage type coins, however, aren't recording a huge increase
or decrease in activity, he said.
"Steady as it goes," Thomas said.
A 1930-S dime uncirculated has only $1.30 silver value, but
collector demand for that coin is strong, said Ken Pines of
Coast to Coast.
So don't expect coin collectors to turn in their collections
for melt value.
"It's a real effort to come up with enough good collector
coins," Pines said. "There aren't a lot of sellers
of collector coins out there. They're not speculating on the
market." But an abundance of bullion-related materials
is now being offered, Pines said.
"It's going out of here as fast as it's coming in,"
he said. "A lot of people have $20 gold pieces they bought
for $300 and $400 that they can now sell for $1,000,"
Pines said. In fact, on Feb. 26, Coast to Coast was buying
$20 Saint-Gaudens BU for $981 and selling them for $1,016.
So is this the time to sell your bullion-related coins?
Thomas said it depends on what you have, what you purchased
it for, and your comfort level.
"I always tell people, if you're interested in selling
but you don't want to pull the trigger because you don't want
to be wrong, sell half.
"If you have $50,000 in silver, sell $25,000. If the
price of silver goes down, you were half wrong. If it goes
up, you were half right. It makes people feel better about
their decision whether they're ready to buy or sell."
Liz Coggan, numismatist with J.J. Teaparty of Boston, said
the retail store, which handles a lot of bullion, has been
unbelievably busy, with people 10 to 12 deep at the counters
all day. And J.J. Teaparty is doing a lot of buying.
Coggan thinks it's a good time for collectors to think about
"It's only a profit if you take it," she said.
"It's not a profit on paper. People may say of their
bullion gold coin, 'I've made $600 on this coin because I
bought it at $300 and now it's at $945.' You've only made
$500 or $600 an ounce if you sell it."
Some people would be prudent to take a profit, especially
if they have a fair amount of product, she said.
"You don't want profit to just evaporate in front of
you," Coggan said.
Weak consumer confidence may push the price of gold higher,
Coggan said, but people may just pull back and not buy anything
if they feel the economy is on shaky ground. "It's really
hard to tell," Coggan said. "The country used to
be its own entity. If stocks went up, gold went down. It doesn't
function that way any more. We're so globally connected. It's
harder to read the markets and where it's going to end up."