Rising Precious Metals Prices Help Fuel Liberty Dollars Market: The Liberty Dollar is a privately manufactured currency issued in gold and silver rounds and gold and silver certificates. The certificates are “warehouse receipts” for actual precious metals that are owned by the bearer. They were issued by Bernard von NotHaus who was convicted in the Western District of North Carolina in March 2011 of conspiracy and counterfeiting charges. The first gold and silver backed coins, called rounds, were struck in 1998 at a private mint in Idaho.

Until July 2009, Liberty Dollars were distributed by Liberty Services, formerly known as NORFED of Evansville, Indiana. Von NotHaus, founder of the Royal Hawaiian Mint Company, was the principal of NORFED, which is an abbreviation of “National Organization for the Repeal of the Federal Reserve and the Internal Revenue Code.”

Since Liberty Dollars are made of gold, silver, platinum, or copper, their current value fluctuates with the price of these intrinsic metals’ values. The base value of the Liberty Dollar was $20 Liberty Dollars to one ounce of silver. When the operation closed, one ounce gold Liberty Dollar pieces were denominated $1,000 with a charge of 10% over the spot price with membership. The prior base values were $10 silver ounce, $20 silver ounce, and $500 gold ounce. Discounts for members ranged from 0% to 50% for short periods of time. While not claiming to be legal tender, Liberty Dollars have always been worth their intrinsic value in precious metal.

The original value of the precious metal in the Liberty Dollars was less than the dollar denomination printed on them. A Liberty Dollar that is imprinted $20 might have contained $15 worth of silver. Profit was made by selling these coins for a small mark-up of, for example, $18. Merchants made a profit by using the full face value of $20 in making change. However, in times of great bullion appreciation, all of this is moot because the actual value of the Liberty Dollar is its precious metal content.

In the first part of 2008, the value of the metal in the Liberty Dollars approached their face values as silver rose to over $18 per ounce and gold to $1000. Presently silver is about $35 per ounce and gold is $1777. The 1998 Liberty Dollar is 1 ounce Sliver that is .999 fine. The $50 and $100 of 2003/2006 are 5 ounces Silver and .999 fine.

In a much publicized trial in 2011, von NotHaus was convicted of multiple charges including conspiracy against the United States, that the Liberty Dollars are counterfeits, contraband, and subject to seizure; von NotHaus was also labeled a domestic terrorist by the United States FBI. As a result of this trial, holders of Liberty Dollars might be concerned that their pieces might be subject to seizure as well; however, there is no indication from federal authorities that they plan to confiscate privately held Liberty Dollars.

Liberty Dollars are currently available for sale on eBay and other venues. A 2000 1 ounce gold piece with a $500 face value is listed at $2,500, and quarter ounce .999 fine silver $5 round is offered at $25.65. A $10 one fifth ounce silver 2008 Liberty Dollar is listed for $18.99. Clearly if these pieces were purchased at a discount to their face value or at face value, they have already appreciated or have the potential to appreciate in value as the price of the metals increase.