If you haven’t heard the news already, the U.S. Mint announced earlier this year that they would be curtailing their overall production of US Gold Eagles in 2009 due to problem sourcing gold to mint them from.  The Mint is required to source it’s gold from American mines and because of the huge worldwide demand for gold bullion, was unable to acquire enough to meet projected needs for this year’s Gold Eagle Rounds minting.

This has two impacts on the collectible market: first, it somewhat raises the price of all other gold coins on the market as demand increases; second, it makes the 2009 US Gold Eagles an immediately collectible item because of their relative rarity.

Up to this point in 2009, US Gold Eagles have only been produced and offered in full ounce coins, very rare for the Mint to do.  They’ve been offered on a rotational basis, making them somewhat more difficult to source directly from coin dealers.  The added interest in them has meant that many shops sell out the day they receive their shipment.

Fractional coins (1/4, 1/2 ounce, etc.) will be available for a very limited time in December.  Those promise to be very hard to get and in demand as well, becoming instantly collectible.

Gold Eagle Rounds have always been popular as an investment medium for bullion purchasers who don’t buy full or sized bars.  This year, however, 2009 US Gold Eagles are instead collector’s items in themselves.  Bullion purchasers have turned to other coins, such as the Canadian Maple Leaf, instead.

Definitely interesting times, but the traditional Walking Liberty motif of the Gold Eagle Rounds is always popular and even more so now with this latest development.

Read more….

Spot Silver prices opened this week at $17.48. Silver reached a high of $17.97 on Friday, October 23rd. The low for silver occurred on Thursday, October 22nd at $17.38. Silver ended the week up $0.23 at $17.71. This week, investors concentrated on 2009 1 oz. Silver American Eagles, 2010 1 oz. Canadian Silver Maple Leafs and 1 oz. Sunshine Minting Silver Rounds.

Platinum:

Spot Palladium prices opened this week at $331.00, and ended the week up $7.00 at $338.00. 2009 1 oz. Palladium Maple Leafs, 1 oz. Pamp Suisse Palladium Bars and 10 oz. Pamp Suisse Palladium Bars are consistently popular palladium items.

The Daily Reckoning

The finance ministers of the Eurozone met yesterday and they’ve tried to stem the euro’s (EUR) rise… But they’ll need more than words to get the job done! And so we begin a new day…

Front and center this morning, the currencies – which had given background overnight to the dollar – are back in rally mode, and are taking liberties with the dollar once more. For most of the night, that was not the case, though. The dollar had rallied back and sent the euro, for instance, to the 1.48 handle, after the single unit spent yesterday at 1.49 and change… There seemed to be a move to the dollar, but that didn’t last long, and the currencies are once again rallying versus the dollar this morning, and the euro has pushed to 1.4970 as I write.

Daily noise, eh? Yes, you have to wade through it most days, and keep your eyes fixed on the horizon…

OK, I mentioned above that the finance ministers of the Eurozone met yesterday, and tried to stem the dollar’s decline by backing the US administration’s stated preference for a strong dollar… Of course we all know that the US administration’s stated preference for a strong dollar is a bunch of horse dookie! So… What was it that the Eurozone FMs were backing? A false statement by the US? Now, that’s something to hang your hat on, eh? The dolts just continue to mount daily don’t they?

But, you can’t be too hard on the beaver (Eurozone FMs) for they have to sound like they don’t want their euro to get too strong, for if they really said what they wanted to say, the euro would be back to 1.60 with a bullet in a heartbeat! So… In the end, I don’t think currency traders were swayed by the Eurozone FMs, at least not for too long!

Yesterday, I talked about Canada and the Bank of Canada (BOC) and how I thought that the BOC would remove their statement about interest rates remaining on hold until the second half of 2010… I had a few readers question me on this, saying that Canada’s economy is in no shape to withstand a rate hike… OK… Hear me out on this… I’m not saying that the BOC will hike rates now, or even in 2009… But, if Canadian energy prices of oil, natural gas, and coal continue to get stronger, I’m afraid the BOC will have to entertain thoughts of raising rates to fight inflation… But not now… So… I hope you get what I’m saying here.

So… The US fiscal deficit for 2009 was $1.42 trillion… Remember how I used to take the previous administration to the woodshed for posting $450 billion fiscal deficits? How did we go from $450 billion to $1.42 trillion (if that’s really the number)? Well… That’s not a question to really answer, folks, we all know how we got here… But now that we’re here, what happens next?

I came across this when putting the two monthly newsletters together on Sunday; I think it would be appropriate to share it with you here…

Peter Bernholz (Professor Economics in Basel) studied the world’s 12 most important periods of hyperinflation and discovered that the tipping point occurs when deficits amounted to 40% of the expenditures.

For the United States we have arrived at exactly that point. The deficit of $1.5 trillion amounts to 41.7% of the $3.6 trillion in expenses.

You see, that Peter Bernholz rounds some numbers, but for those of you keeping score at home, the real point is that the US deficits are greater than 40% of expenditures… And you know me, I truly believe in this history repeating itself.

The point I’m trying to make here is that according to Mr. Bernholz, we can soon expect a bout of hyperinflation! OH BOY! Where do I sign up for that? Not only do we have a falling dollar causing us to lose purchasing power, but what purchasing power we have left is going to be eaten away with inflation! Like I said, OH BOY! Gee Willikers, that sounds like the cat’s meow! NOT!

So… Here we go again, with me getting on the soapbox and telling you that the only way to protect yourself from a falling dollar and hyperinflation is to diversify with non-dollar currencies and precious metals.

OK… I get emails all the time from readers that say, “OK Chuck, you tell us to diversify, but you don’t tell us what to buy”… Well… To the untrained eye, that would be true… But to long time readers they know better… So, keep reading, and it will hit you right between the eyes one day, and you’ll slap your forehead and say, “I could have had a V-8”!

The boys and girls over at Citigroup have written a letter to their clients telling them “the dollar is weakening because foreign central banks are diversifying their reserves and US investors are buying high-yielding emerging market assets.” They went on to say, “The Australian and Canadian dollars are likely to rise to parity against the US currency.”

So, there’s one more on the roster that believe Aussie dollars (AUD) and loonies (CAD) will go to parity against the dollar… The loonie isn’t exactly the same stretch of a forecast as the Aussie dollar, as loonies are almost 97-cents right now, with Aussie dollars trading near 93-cents…

Doesn’t that make sense given the talk we just had about hyperinflation? What currencies are going to help protect you against hyperinflation? The commodity currencies! Aussie, kiwi (NZD), Canada, Norway (NOK), Brazil (BRL) and you can even throw in the S. African rand (ZAR), for those who like Mr. Toad’s wild ride!

The folks at Citigroup also had this to say about the euro, which I found to be quite interesting… “The euro will extend gains against the US dollar and the British pound, and may reach parity against the UK currency in 6 to 12 months.”

I would think that for the euro to reach parity with the pound, it would involve the pound falling quite a bit from current levels… And that makes sense to me… Did you see the report the other day from the UK where they reported bad bank debt to be twice the forecast amount? YIKES!

You know… The Asian currencies – which never really participated in the first bout of dollar weakness – are still stuck in the mud… Well, they are being manipulated to be stuck in the mud, for the most part… But, something’s got to give here sooner or later. Why do I say that? Well, as I’ve told you for months now, the Chinese economy was the first to exit their slowdown/recession… Shoot Rudy, even Japan is showing signs of economic growth! And then we have India going strong too… And of course you have the “kind of Asian countries” of Australia and New Zealand… Where we already know that Australia has raised rates and New Zealand would love to raise rates… So, this region is leading the world out of the recession… Hmmm… I thought only the US economy was allowed to do that! Uh-Oh… Looks like we have a shift in how the world works!

Hey! Even Big Ben Bernanke sees the Asian countries as leading the world out of the global recession! Big Ben said… “Asia appears to be leading the global economic recovery.” Hmmm… See, even a blind squirrel can find an acorn! HA!

I had to laugh when I read this headline this morning… “Yen rises as Fujii repeats reluctance to stem currency’s rise”… I laugh because the last time Japan’s new finance minister talked about not intervening to stop the yen’s rise, he back-pedaled and said that traders mistook him to say that he was not going to intervene… So this on again/off again love affair with Fujii and intervention, just makes me laugh! I would think that after getting burned on Fujii comments a couple of weeks ago, that Traders would not get too lathered up when he talks about not intervening.

OK… Here in the US while we are still a sovereign nation, the Fed Reserve, is doing some testing of reverse repos as a means of drawing the excess liquidity/stimulus out of the markets… I don’t think we have to put too much into these tests right now. But it will be a method that the Fed uses at some point in the future… The IMF is against removing any stimulus now… So, that may carry some weight.

Gold prices rose yesterday for the first time in a couple of days, pushing back above $1,060… I would think that until we know for sure that the Fed is removing stimulus, that gold would remain well bid… When we do know that stimulus is being removed… Gold might take a step or two back… But then we’ll have to wait-n-see what happens with inflation.

I read where ETF holdings of gold are sluggish… Well, that certainly makes sense to me! With what we’re seeing these days from our government pushing us toward who-knows-what, physical gold is the thing people want right now… And you can’t get physical gold out of an ETF! So… All those people that have long said that the ETF was just as good as holding gold either in your buried coffee cans in the back yard, or in pooled accounts, are wrong, when it comes to physical gold demands.

And I don’t know about you, but I filled my gas tank the other day, and the price of gas has really shot up recently, eh? And a quick look at oil prices tells it all… Oil prices have risen to $79, while trading at $69 just a month ago! Is oil the proxy for rising inflation?

OK… To recap… The dollar rebounded a bit overnight, but has given back to a currency rally this morning. Citigroup believes Aussie and Canadian dollars will reach parity to the US dollar. The Bank of Canada meets today. Our fiscal deficit reached 40% of our expenditures, which historically is a harbinger to hyperinflation, and gold is back above $1,060 this morning…

US Hyperinflation? originally appeared in the Daily Reckoning. The Daily Reckoning, a FREE daily e-letter, offers a “uniquely refreshing” perspective on the global economy, investing, and today’s markets.

More articles from The Daily Reckoning….

The US Mint on Friday "sincerely apologized" to customers who experienced difficultly and frustrating moments Thursday when attempting to order the newly issued Lincoln Coin and Chronicles Set.

As we relayed on CoinNews yesterday, the US Mint Web site was either down or sporadic in behavior for several hours following the launch of the new Lincoln set.

The collectors here at CoinNews experienced the same frustrations in ordering — and excitement in the hunt. But we can offer no grounds to blame the Mint considering our own CoinNews.net site went down for a time as collectors used our ordering links as gateways to the Mint’s Lincoln Chronicles page. And we had just over 9,000 visits in the afternoon while the Mint likely had that during the first minutes of issue.

The Mint should be commended for its apology and recognition of the problems. Here is the Mint message in its entirety:

(…)
Read the rest of US Mint Apologizes to Customers for Chronicles Set Experience (111 words)

The Daily Reckoning

Today we’re already seeing a HUGE currency rally versus the dollar, on the news that the Reserve Bank of Australia (RBA) opted to go ahead and hike rates now, rather than wait for November’s meeting… Which I thought they would do! WOW!

The first hike has opened Pandora’s Box of interest rate hikes around the world… For if the RBA went this soon, then we can expect Norway’s Norges Bank to push their rate hike earlier on the calendar… Maybe even later this month! And they won’t be the only ones! Look for New Zealand to hike rates this year, and who knows what other country (Brazil?) will follow after that… But I see them coming, and they’re sounding the death knell of the dollar!

OK, that’s a little dramatic, and although I have more doubts every day, I don’t really believe that the dollar will collapse to nothing… But I do believe it has a long way to go when it comes to weakening. How else will the US pay back their debts in the future? It sure won’t be because of a cut in government spending! That is… Unless all this deficit spending can be reversed and government is cut (in size) to resemble something from 50 years ago! But, that’s like asking for the moon and sky, eh?

Let’s get back to the Aussie rate hike… That’s more exciting and upbeat than talking about what’s going to be needed in the future here in the US! The statement that followed the RBA rate hike, was very upbeat… So… I totally expect another rate hike next month from the RBA!

OK… The dollar’s weakness this morning isn’t all due to the Aussie rate hike, and prospects for other rate hikes around the world… In 2001 I wrote a whitepaper called “The Demise of the Dollar”… This was the thesis for all the things I talk about almost daily regarding the reasons the dollar would go into a secular bear market… And this was one year BEFORE the dollar entered into a weak trend in February of 2002!

The reason I bring this up here in 2009, is that there is an article in the UK Independent that’s making the rounds, that’s called… “The Demise of the Dollar”! This report, though is about secret meetings with the Gulf Arabs along with China, Russia, Japan and France, and they are planning to end dollar dealings for oil, moving instead to a basket of currencies including the Japanese yen (JPY) Chinese yuan (CNY), the euro (EUR), gold and a new, unified currency planned for nations in the Gulf Co-operation Council, including Saudi Arabia, Abu Dhabi, Kuwait and Qatar.

Secret meetings have already been held by finance ministers and central bank governors in Russia, China, Japan and Brazil to work on the scheme, which will mean that oil will no longer be priced in dollars.

Uh-Oh… That’s serious stuff, folks… And that death knell I talked about above? Well, if this story is true, that death knell just became much louder!

Right now, however, the markets aren’t taking the story to heart, just yet… Yes, the dollar has been sold, but not like you would think… I think some digestion time needs to be had first. I mean the currency traders had the first rate hike and then this story on their plates all at one meal. That’s a lot to digest! And Besides… The Saudi Bank Governor is denying that any of these meetings took place… Of course, to conspiracy buffs like me, that’s akin to saying, “These meetings DID take place, and we’re just covering up the evidence.” HA!

Now… Some might be cursing these countries right now, for dealing this rumored blow to the dollar… But, it’s not like the dollar didn’t have it coming! The deficit spending, for instance, is one thing that many people realize the US will not be able to climb out from under… And those knuckleheads who said that “deficits don’t matter”? Well… I’ve said this many times before, but I can’t talk about the “deficits don’t matter” crowd without talking about that old joke… A guy jumps off the Empire State Building, and as he passes the 56th floor, he says… “So far… So good!”

Well, unfortunately for our “deficits don’t matter” guy falling to the ground, the sidewalk is coming at him very quickly now.

And here’s another thing that should just tick you off to no end… You have to think that the people who’ve loaned us money are wondering if they’ll ever get paid back… What I’m talking about here is the story from yesterday, regarding the TARP funds… You might want to sit down for this one, folks.

Neil Barofsky, the special inspector general for the Troubled Asset Relief Program (TARP), says that despite multiple statements on October 14th of last year saying that these nine banks were healthy and only receiving government funds for the good of the country’s economy, federal officials knew otherwise. He went on to say that “the Treasury Dept. and the Federal Reserve lied to the American public last fall when they said the first nine banks to receive government bailout funds were healthy.”

That’s right… They LIED TO US! Now, doesn’t that just tick you off? It sure ticks me off!

So… You can see some of the reasons the countries mentioned above might be thinking about removing the dollar as the pricing mechanism when it comes to oil.

OK… We started upbeat, then got brought down, let’s get back to upbeat! Hey! How about gold? When I turned on the screen this morning, gold was $1,020! You would think that even if the UK Independent story is just a rumor, that gold would gain on the rumors.

I read a story last night while waiting for the so-called “Epic Battle” between the Vikings and Packers on Monday Night Football, that one analyst was of the belief that gold was about to return to its link to the price of oil… Hmmm… Well, I personally hope that’s not the case, as I certainly don’t want to see the price of oil rise to the levels I think gold is going to rise to!

One thing that we’ll begin to see this month is the earnings season…

You might recall that in previous quarter-ends I thought that stocks would get taken to the woodshed, because of lousy earnings, only to be surprised at the earnings that were posted… But trying not to be the boy who cried wolf, I’ll once again say that I just don’t see the earnings to support stock prices. This time I think we’ll see that the method used in previous quarters by Corporations to produce the earnings was cost cutting… One would have to think that the Corporations have cut to the bone… And now, we’ll get to the cheese that binds for earnings… A lack of revenue.

I really liked the reaction of the non-dollar currencies, led by the Aussie dollar (AUD), after the RBA rate hike… It was like “old days”… Well, in this case I am talking about currencies trading on “fundamentals” not stupid trading themes, not flights to safety, not deleveraging, but plain and simple fundamentals, things that ordinary people, like me, can understand, and place a value on a currency-based on the fundamentals!

But… We’ve not really seen a fundamental trend since July of 2008… However, if we begin to see the rate hikes that I think we’ll begin to see, it could be the harbinger of a return to fundamentals… And that, my friends, would be like manna from heaven for your Pfennig writer!

Well… Since I came in this morning, gold has gained $5 more, to $1,025! Looks like the all-time high of $1,033.90 that came in March of 2008, could be in jeopardy.

Maybe gold moving higher can get silver going too!

OK… To recap… The RBA did raise rates 25 BPS last night, and sounded quite upbeat in their after-rate-hike statement. Look for other countries to follow now that Pandora’s Box of rate hikes has been opened. There’s a story going around about countries banding together to remove the dollar as the pricing mechanism for oil trades… It’s being denied, but there’s smoke… And you know what I say when there’s smoke… And gold is pushing the envelope on its all-time high of $1,033.90.

This article originally appeared in the Daily Reckoning. The Daily Reckoning, a FREE daily e-letter, offers a “uniquely refreshing” perspective on the global economy, investing, and today’s markets. Follow the Daily Reckoning on Twitter.

Is the Dollar Being Removed from Oil Trades?

More articles from The Daily Reckoning….

Just when Wall Street wanted you to think it was okay to wade back into the stock market, some all too familiar sharks continued to muddy the water for investors.

The Fall of 2008 marked the beginning of the biggest financial down slide in the U.S. since the Great Depression. Unfortunately, not much has changed in the big picture. This week, hopes of financial healing took another hit as the Labor Department released new unemployment data showing a 26-year high at 9.8 percent. The month of September saw 263,000 jobs added to the casualty list, bringing the total to 15.1 million Americans out of work.

Older Americans are particularly being affected by job market losses according to the Social Security Administration, resulting in a 23 percent increase in retirement benefits applications.

This news leaves many asking what goals the stimulus package has achieved, as it has not yielded positive effects on consumer spending, one of the primary factors in shoring up any economy. Meanwhile, the threat of massive inflation weighs heavy on investors’ minds.

Most self-directed investors have quietly been amassing silver and gold over the past year to protect their assets. Many gold and silver investors have been predicting these events for some time and have been stockpiling precious metals throughout the year.

Investors across the nation took full advantage of APMEX’s One Million Ounces of Surplus Silver Sale during the last week of September. At the end of the month, APMEX had just over one hundred thousand ounces remaining from the sale, proving that the flight to precious metals is not over – it is just beginning as people continue to realize the true value of preserving wealth with hard assets.

Gold:
Spot Gold prices opened this week at $992.40. The high during the week was on Wednesday, September 30th at $1,009.00, while the low for the week was on Tuesday, September 29th at $984.70. Gold ended the week with a modest gain of $11.00 at $1,003.40. This week, 2009 1 oz. Gold Eagles, 2009 1 oz. Gold Maple Leafs, Gold Sovereigns and 1 oz. Gold Krugerrands were the most popular items investors purchased.

Silver:
Spot Silver prices opened this week at $16.06. Silver reached a high of $16.63 on Wednesday, September 30th and repeated the high on Thursday, October 1st. The low for silver occurred on Monday, September 28th at $15.80. Silver ended the week up $0.15 at $16.21. This week 2009 1 oz. Silver American Eagles, 1 oz. APMEX Silver Rounds, ½ oz. APMEX Silver Rounds and 2009 1 oz. Silver Philharmonics were steady movers on the APMEX website.

Platinum:
Spot Platinum prices opened this week at $1,279.70, and ended the week up $6.30 at $1,286.00. Many investors continue to be genuinely interested in platinum. Popular platinum products for this week included 1 oz. Pamp Suisse Platinum Bars, 2009 1 oz. Platinum Canadian Maple Leafs and 1/10 oz. Platinum American Eagles.

Palladium:
Spot Palladium prices opened this week at $294.00, and ended the week up $6.50 at $300.50. 2009 1 oz. Palladium Maple Leafs, 1 oz. Pamp Suisse Palladium Bars and 1 oz. Palladium Lewis & Clark Rounds were popular with investors.

Numismatics:
Unquestionably, the most collected coin in the world is the Morgan Silver Dollar. This coin was named after its designer, George T. Morgan, and minting began in 1878. The series culminated in 1921 after a 16-year absence, between the years of 1905 and 1920. Beginning this week, APMEX will highlight a particular date and mintmark of silver dollar and share this information with you. These reports may unlock some of the reasons why this particular series of coins has become so popular. Is it the beautiful design? Is it because each coin contains .77344 ounces of pure silver? Whatever the reason, these coins are the most popular in the world. This week we will look at the 1889-CC.

It is not lost on any coin collector or investor that coins from the Carson City (Nevada) Mint command a premium. The 1889-CC is no exception. With a total mintage of only 350,000 business strikes, this is one of the rarest coins in the series. Frankly, this is a difficult coin in virtually every grade from Almost Good to Mint State-64. It is virtually impossible to find in any grades higher than that. These coins often exhibit a less than average strike, but they are often found with a satin-like to frosty luster. Many higher-grade examples display semi-proof like fields that are designated in the industry as ‘DMPL,’ which stands for Deep Mirror Proof Like. However, as one would rightfully assume, many of these coins have been well circulated, as these coins were spent throughout the remainder of the 19th century and into the 20th century. Consequently, there are a large number of circulated examples. Though 10 obverse dies and 7 reverse dies were used to strike these coins, there are no major die varieties within the date. As more collectors and investors learn about Morgan Silver Dollars every year, these coins may likely increase in value!

Silver bullion is a lousy investment but if you are interested in buying silver there are any number of companies that will sell 1oz silver rounds, all you have to do is to Google “bullion coins” and do some shopping. …

Read more….

This week has seen more sideways trading as the markets continue to seek a clear and definitive direction. While some are claiming the worst is over, others like Bloomberg.com report that more than 300 banks could still fail across the nation, further affecting small businesses and consumers, the real drivers of the economy. This mixed review has left many precious metals investors highly concerned about the validity of the positive reports and leery of the potential backlash of over confidence in the stock markets.

APMEX’s “The Great American Coin Giveaway” is in full swing. In fact, APMEX shipped out free coins like Silver American Eagles, 1/10 oz Gold American Eagles and 1 oz Silver APMEX rounds to the lucky winners this week. There will be more awards in the coming weeks, but you need to register to have the opportunity to win. Register for APMEX’s Great American Coin Giveaway here. Congratulations to the WINNERS from the Great American Coin Give Away! You can view winners on the contest winners page!

Gold:
Spot Gold prices opened this week at $947.50. The high during the week was on Monday, August 17th at $947.70, while the low for the week was also on Monday, August 17th at $930.00. Gold ended the week up $6.70 at $954.20. This week 1 oz. Random Year Gold Krugerrands, 1 oz. Random Year Gold American Eagles and 1/10 oz. Random Year Gold American Eagles were in very high demand.

Silver:
Spot Silver prices opened this week at $14.73 and set its high for the week on Monday, August 17th, while the low for silver was occurred on Wednesday, August 19th, at $13.49. Silver ended the week down $0.50 at $14.23 This week 2009 1 oz. Silver Maple Leafs, 1 oz. Brilliant Uncirculated Silver American Eagles, and 1 oz. APMEX .999 Fine Silver Rounds sold in very strong quantities.

Platinum:
Spot Platinum prices opened this week at $1265.00, and ended the week down slightly at $1261.00. 1 oz. Pamp Suisse Platinum Bars, 2009 – 1 oz. Platinum Canadian Maple Leafs and 1 oz. Brilliant Uncirculated Platinum American Eagles continue to enjoy investors attentions.

Palladium:
Spot Palladium prices opened this week at $276.00, and ended the week with a gain of $10.25 at $286.25. Popular products this week were 1 oz. .999 Fine Pamp Suisse Palladium Bars, 1 oz. .999 Fine Credit Suisse Palladium Bars, and Kilo .999 Fine Pamp Suisse Palladium Bars.

Numismatics
Though it is a fixture on all American coins and currency now, IN GOD WE TRUST did not appear on American coinage until 1864 when it graced the Two-Cent Piece. This was due in large part to the strong religious beliefs of the time during the Civil War. Secretary of the Treasury Mint Salmon P. Chase took it upon himself to affix some type of motto with the word “GOD” onto all coins. He was successful in doing so in 1865 when Congress, and the Mint Director allowed the motto to be placed on all silver and gold coins. Between the years of 1864 and 1909 it appeared on some coins while it did not appear on others. A few coins that it did appear on were the Shield Nickel , the $20, $10 and $5 Liberty Gold Coins, the Morgan Silver Dollar, the Barber Half Dollar, and the Barber Quarter Dollar. It appeared on the new Lincoln Cent in 1909 and has remained there ever since. In 1916 it became a permanent fixture on the dime and the quarter. The Jefferson Nickel, first minted in 1938, also bore that inscription. In 1956 IN GOD WE TRUST was declared the national motto of the United States. The motto first appeared on paper currency in 1957 with the one dollar silver certificate. Though it has met with some controversy, most Americans approve of the motto on United States money.

APMEX has now obtained the 2009 Denver Mint Professional Years Lincoln Cent. They are available as a single coin, as a roll, or as a 50 roll box ($25 Face Value). Next week, on August 26th, the Mint will release the 4 newly-designed 2009 Lincoln Cents in their original copper composition, just as they were released in 1909. These coins will be packaged as a four coin proof set. Their original composition was 95% copper, 3% zinc, and 2% tin alloy. Thomas Jurkowsky, Director of the U.S. Mint’s Office of Public Affairs, has stated that the sets are unlimited. The Mint has not yet disclosed a price.

Bullion Vault

As the US fights deflation, credit inflation is alive and well in China…

The INVESTMENT COMMUNITY is divided at present as to whether the world economy faces hyperinflation or deflation, writes Puru Saxena of Money Matters and Puru Saxena Limited in Hong Kong.

Some observers are convinced that the central banks’ printing press will take the world towards hyperinflation whereas others believe that the ongoing contraction in American private-sector debt will result in outright deflation.

But what will the future bring? It is my contention that we will get neither hyperinflation nor deflation.

What is more likely is that, over the coming months, we will get another deflationary scare. Any sell-off in the markets later this year will be met by an even larger stimulus from the policymakers and this will ultimately result in high inflation.

So I maintain my view that due to the unprecedented policy responses around the globe, the world’s economy will face high inflation over the medium to long-term. And the general price level will double over the coming decade.

In the near-term however, we will probably get another period when the market will (once again) become concerned about the prospects of a lengthy economic contraction. It is conceivable that the ‘green shoots’ hype currently doing the rounds will soon be replaced by more economic worries as a second wave of foreclosures hits America later this year.

It is therefore possible that before year-end we will witness large corrections in stocks and commodities. Conversely, we are likely to see big rallies in US government bonds, the US Dollar and Japanese Yen.

Read more….

When shopping for bullion coins you may have encountered something called rounds, and been confused about the term and what it means. Similarly you may have encountered medallions and wondered how they differ from coins. The basic difference between a coin and a round is that a coin is officially minted and is legal tender, while a round is not legal tender, and is usually privately minted. In its most standard usage, the word “medallion” refers to a metal piece that is, similarly to a round, not legal tender. But the word “medallion” tends to be used for a lot of commemorative coins aimed at collectors, whereas “round” tends to be used for bullion coins aimed at investors.

An example of a bullion coin is an 1 oz. American gold eagle or American silver eagle, since they are legal tender and officially minted by the US Mint.

An example of a silver round is this North West Territories (NWT) Mint one ounce silver round. I can’t give you an example of a gold round, because even though I know they exist they are rare. Gold is so much more valuable than silver that investors prefer the safety of officially-minted and well-recognized coins.

An example of a gold medallion is this Winston Churchill commemorative medallion.

It should be noted that while the above definitions are the most common specific definitons, the word “coin” is often used in a general sense to refer to all
coin-shaped items. But a true “coin” will have a clearly marked face value in the currency of its country of mintage. For example, a 1 oz American Gold Eagle has a face value of $50. A generic silver round will not have a face value indicated, but just the precious metals weight and purity. For example, “1 troy ounce .999 fine silver” as printed on the NWT silver round. Commemorative medallions sometimes don’t even have the precious metal content and purity written, so to determine that information you need an appraisal or certificate of authenticity.

Are there any advantages of coins over rounds and medallions?

Well, as mentioned before, officially-minted coins are easier to trust and feel secure with, since you know that your bullion purchase was made in accordance with all laws and regulations. In addition, officially minted coins, especially major ones like Maple Leaves, American Eagles, Krugerands and the like, are highly recognizeable and very liquid because of their visibility. The downside of officially minted bullion coins is that they carry a relatively high premium, partly because of higher demand but partly because they are not sold directly from the mint to individual investors, they first go through middle men. The US Mint for example sells its coins to distributors called “Authorized Purchasers”. The authorized purchasers then mark them up and sell them to bullion retailers, who also mark them up before selling them to you. So in the case of an American silver eagle, you pay a significant premium over the spot price of silver to pay for the operations of distributor and bullion retailer.

In the case of a silver round, you can order directly from the mint, or retailers order directly from a mint, so you pay a lower premium over the spot price. This difference in premium can be quite hefty, for example the current spot price of silver is around $13.50, but an officially minted 1 oz bullion coin will probably command at least $18 while a silver round could be bought for as little as $15. If you are buying in large quantities, silver rounds could help you accumulate a significantly larger stack. When selling your silver rounds, they will of course command a lower price than officially minted bullion, but you should be able to get at least the current spot price. If you are living somewhere where your round is not recognized (or in my case, the silver ingots I bought in Japan), then you may have to sell your metal to a melter at less than spot. But you can always sell back to the mint you bought it from, at a small price spread. So basically, while officially-minted coins have the benefit of immediate recognizability and liquidity, rounds are more of a direct investment in physical bullion. When it comes to silver I personally prefer to hold about 1/3 of my stack in widely recognized bullion coins, and 2/3 in silver rounds. That way I have some guaranteed liquidity for emergencies, but still have the benefit of buying at lower premium rates.

As for medallions, if they are not in high demand then they can be treated like a round. But if they are sought-after by collectors then they will likely command
a numismatic premium well beyond the spot price of gold or silver. I personally stay away from almost all numismatic coins because I’m much more of an investor than a collector. But if I find a medallion at close to the spot price, I might buy it. The problem is making sure that you know its constituent metals, weight, and purity which are not always indicated.

A note of caution: there are a large number of rounds and medallions that are replicas of officially-minted coins. They are legally allowed to reproduce the images of officially minted coins, but they can not be the same size and dimensions as the original. You may encounter some 1 pound or 1/2 pound “American Eagles” for example (see the example below). If you buy them from a legitimite private mint, then you can trust that their precious metals content is genuine. The weight and purity should be written on the round. Please be aware that such replicas exist, and understand what you are buying. Some of the private mints have names that sound official, like “Washington Mint” or “American Mint”, so novice investors may assume they are buying an official proof coin. And there are vendors, especially on Ebay, who will avoid telling you that these are replicas. Be sure to examine the pieces you are interested in buying, check for a face value, and if the coin is of an unusual size, do your research to see if such a large version was ever officially minted. You can quickly find out a lot of this information online, as long as you know to look.

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