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Own Gold With a Variety of Designs
By Paul M. Green, Numismatic News
March 12, 2013

This article was originally printed in Numismatic News.
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There are not many gold collections of United States coins that most can complete. As expensive as gold is perhaps most collectors cannot complete any gold set. But that doesn’t mean we cannot think about it.

A complete set is possible for Indian Head quarter and half eagles of the early 20th century in some grades although both have at least one key date. In upper grades both are basically close to impossible although the Indian Head quarter eagle is more available than the half eagle. American Eagle bullion coins could also be completed, but for those who want diversity of design the best choice would be gold commemoratives and especially modern gold commemoratives, a series that began in 1984.

Historical gold commemoratives are actually more possible than many might think. There is , however a major problem in the form of the Panama-Pacific $50. Even if you limited yourself to the lower priced round version, there is really not much price difference as you are looking at an AU price of $46,5000 or more and an MS-65 starts at $146,000 for the octagonal version.

The other historical gold commemoratives, which began in 1903 and ran until 1926, are available but limited in numbers. There are a couple $2.50 coins for the Panama-Pacific Exposition and the Sesquicentennial but all the others are gold dollars. With low mintages the gold dollars are tough, but available with the nine generally accepted types and dates being priced from $600 and $2,000 in MS-60.

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The total for the nine in MS-60 is $9,460. That’s more than we would have spent in the circulation finds era, but for an avid adult collector, this set is achievable but not exactly inexpensive. The diversity is limited as in the recognized types and dates there are only five completely different designs as the other four are different dates or slight differences in design such as the Grant Memorial dollar, which came with or without a star.

If you really want diversity the best option is the most recent one. It comes in the form of modern gold commemoratives. That collection has risen in price. This is due to rising bullion costs and to some scarce dates. The 1997-W BU Jackie Robinson $5 is now $2,900.

In addition, the BU gold and platinum bimetallic 2000-W Library of Congress $10 has reached $4,500. Of course being made with two metals, it could be an optional coin for a gold collection but as a unique and interesting item most want to include it as well.

The diversity of a modern gold commemorative collection with or without the bimetallic $10 for the Library of Congress can come as something of a surprise as over the years the number of coins in a set have mounted up quickly. To many older collectors who never expected to see the United States issue another gold coin of any type after the Gold Recall Order of 1933, the modern gold commemorative coins might have been a surprise but they are certainly a pleasant one and along the way the progress of the program has certainly been interesting.

Even when the modern commemorative program began back in 1982 with the silver Washington half dollar, it was probably not expected by many that it would result in numerous gold issues as well. After all, with the abuses of the past being mentioned regularly in the numismatic press, it seemed like the modern commemoratives would not be a program likely to have many major innovations or unusual directions. That was how it might have seemed, but that perception did not last long as almost immediately there was a proposal for Los Angeles Olympic commemoratives and that proposal included a number of gold coins. In fact, the initial proposal was far too large and ran into a congressional roadblock.

It might in a strange way have helped that the Los Angeles Olympic commemorative program as originally proposed was too large and was flawed in other ways. By eliminating almost all of the coins it probably made congressional approval for one gold coin more possible as lawmakers wanted to help Los Angeles raise money to host the Summer Games but by only allowing a few coins that made it much harder and the best way to raise a lot of money from one coin was with larger denominations like a $10 gold.

The approval of a $10 gold commemorative with a 1984 date came as a surprise to virtually everyone. The cutting of the huge program proposal, which could have involved issuing well over 100 coins, to issuing just two silver dollar designs and one $10 gold design was a surprise, but to have the United States issue a gold coin was even more of a surprise. The historic silver dollars were simply dwarfed in importance by the idea of a gold coin. For the first time in half a century the United States was going to issue a gold coin and in the case of gold commemoratives it would be the first time since 1926. The fact that it was not a circulating coin was secondary as already there were more than enough firsts to assure that the Los Angeles $10 would rank as an extremely historic issue.

Probably in part because the Los Angeles Olympic $10 gold was such a success and because of that it trades at bullion value, it does not receive the attention it really deserves. Had the Los Angeles Olympic program and especially the $10 failed or had troubles there would almost certainly have been no other gold coins. There were complaints about the art and about the fact that the coin was offered from four different facilities, which seemed to some lawmakers at the time as an effort to get around the idea of just one coin, but overall there were basically no problems. If you added up the sales from all the facilities, the total was in excess of 600,000 pieces, which represented a healthy profit for the government and a healthy contribution through $50-per-coin surcharges to the Los Angeles Olympics.

It might not have been perfect, but the numbers spoke for themselves. With prices of $352 for proofs and $339 for BU examples, the Los Angeles $10 Olympic made history that collectors liked. If you compare that sales total to sales of any gold commemorative in the past decade and you can see just how successful the Los Angeles $10 really was. Those totals also explain why the Los Angeles $10 coins, even the mintmarked proofs, will probably always sell for a prices that are close to bullion value.

It is possible that the Philadelphia proof example with a mintage of 33,309 and the Denver proof with a mintage of 34,533 might at some point post higher prices as it is possible that enough collectors will want a complete set to dry up those supplies eventually.

There was no pattern to gold commemoratives when they were first released. Even with Olympic sales as high as they were, it was decided more gold coins could be sold on a sustained basis if the denomination were changed to $5, thereby reducing the issue price by half.

The next gold coin was the $5 for the Statue of Liberty. It too was an enormous success. In fact, the Statue of Liberty $5 was an interesting issue that sold out quickly. The Statue of Liberty $5 had prices of just $175 for the proof (in a three-coin set with a silver dollar and clad half dollar) and $160 for the BU three-coin set in the pre-issue discount period. In addition the Statue of Liberty was a slightly more popular topic for many. With those considerations, the logical conclusion would have been that the Statue of Liberty $5 would potentially have higher sales than the Los Angeles Olympic $10, yet the authorization was put at just 500,000 pieces, over 100,000 fewer than the Los Angeles Olympic $10.

Almost from the moment the Statue of Liberty $5 was approved there was speculation that all 500,000 pieces would sell. That proved to be right but what was surprising was how fast they all sold as literally a couple months after being offered the Statue of Liberty $5 was sold out and rising in price. In fact, it was spectacular with the three-coin set reaching around $500 before many even had received their coins. It was a tidy profit in a matter of months, but that price could not hold as like the situation with the Los Angeles Olympic $10, the market was simply not large enough to absorb all the coins being offered for sale. That saw the $5 Statue of Liberty fall after reaching its peak to as low as $90 or so before rebounding.

The Statue of Liberty $5 and its early secondary market price increases proved to be a great help to the sales of the next gold $5, which was issued in 1987 for the Bicentennial for the Constitution.

It is difficult, if not impossible, to suggest how many Bicentennial of the Constitution $5 gold coins would have sold were it not for the fact that at the time orders were being taken the $5 Statue of Liberty was still sitting at prices well above its issue price.

Moreover, there had been months of publicity regarding the sellout of the Statue of Liberty $5 and no one was taking any chances with the Bicentennial of the Constitution. In the end the sales totals were over 650,000 for the proof version and 214,000 for the BU. Large though they were, the totals did not equal the 1 million number that Congress had authorized, and were not a sellout. Once the sales were completed the Bicentennial of the Constitution $5 promptly started dropping in price on the secondary market.

With such mintage totals even today the Bicentennial of the Constitution while priced basically at the same level as the Statue of Liberty $5 will be the least likely of any of the modern commemorative gold coins to ever move beyond bullion value.

Just as the Statue of Liberty price increases had helped the sales of the Bicentennial of the Constitution $5, the secondary market price declines of the Los Angeles Olympic $10, the Statue of Liberty $5 and the Bicentennial of the Constitution $5 were likely depress buyer sentiment and to produce a decline in sales of future issues.

It is always a difficult situation. The goal of the government and surcharge beneficiaries is to sell more coins to help raise money for the worthy causes. However, the higher the authorized mintage, the greater the prospects of the coins not doing well either with initial collector orders or in the secondary market. While collectors and dealers might support the worthy goals, they naturally are not likely to do so if the coins they buy start declining in price regularly and that was the situation that developed.

It did not take long for everyone to understand that the coins would be cheaper if you simply waited until after the initial sales were over. The result was a natural decline in orders with the 1988 Olympic $5 posting sales of 281,456 proofs and 62,912 BU coins basically one-half the totals of the Los Angeles Olympics and an even lower percentage of the total of the Bicentennial of the Constitution. The sales were not helped by the prices, which were too high as the $235 proof was basically $60 more than the Statue of Liberty proof just a couple years earlier.

The lower sales still did not reverse the trend toward lower secondary market prices as the 1988 Olympic $5 fell in price as well. There was really no way to reverse the trend as the number of actual collectors was still well below the initial sales and the magic of gold was wearing off.

Promotions and other ideas would only make a small difference as the only way to really turn around the trend was to have sales reach a level where they would ultimately be inadequate to meet secondary market demand. At that point the prices in the secondary market would go up and not down, signaling a bottom had been reached.

The solution was found in 1995 and 1996 when the 1995 Civil War Battlefield Preservation $5 and the 1996 Smithsonian 150th anniversary $5 joined with four Atlanta Olympic $5 coins produced over the two years to basically glut the market with new offers causing a significant initial sales declines. Collectors simply ran out of interest in so many expensive gold coins coming out one after another.

The 1996 coins were good examples with the 1996-W Atlanta Cauldron posting sales of just 38,555 proofs and 9,210 BU coins while the Flag Bearer of the Atlanta Program that same year saw sales of 32,886 proofs and 9,174 BU coins. For its part, the 1996 Smithsonian gold $5 showed sales of just 21,771 proofs and 9,068 BU coins. When you remember that 100,000 coins was not even a particularly good week for the Statue of Liberty $5, the significance of the initial sales decline could be seen.

The market was so weak that the low sales did not result initially in higher prices on the secondary market, but that would come with time. The Atlanta prices were $239 for the proof in the pre-issue discount period and $259 in the regular ordering period and in 1998 it was priced at just $220 before rebounding to $240 in 2002. Since then, the proof and the even cheaper BU have made a straight line to higher prices both for the Cauldron and the Flag Bearer with either being $442 in Proof-65 today and the BU Cauldron being $2,600 while the BU Flag Bearer is $2,600. Clearly lower sales rewarded the few buyers of the BU coins over time.

The Smithsonian’s 1998 prices showed the BU at $215 while the proof had dropped to $195. Since then, however, it has been increasing with the lower mintage BU now at $850 while the proof is at $442.

It was close to rock bottom but not quite. Even though the initial market was clearly in trouble 1997 saw still another $5 gold and this time everyone had high hopes the declining sales trend could be reversed. The coin was the $5 Jackie Robinson, which with the participation of Major League Baseball, everyone felt had a chance to post large sales. Everybody likes baseball, right? Collectors sure didn’t.

Hopes were high with a number of ideas for promotions, including a special offer involving a replica baseball card, lapel pin and patch. In fact, almost no one cared as the card collectors wanted a real, not replica baseball card and neither coin nor card collectors seemed the slightest bit interested in the lapel pin. The proof was in the sales or lack thereof. A mere 21,760 proofs were sold along with a record low 4,594 BU coins.

The price history of the Jackie Robinson $5 was similar to the 1996 issues. It started slowly with 1998 prices showing the proof at $265 while the BU was $245. By 2002 the proof was at $325 but the discovery of the low mintage of the BU had set in resulting in an increase to $1,050. By 2004 the BU was $2,250 while the proof was at $500. Today the BU is $2,900 and the Proof-65 is $590.

Thanks to these low mintage issues of the 1990s, buyers of gold commemoratives directly from the Mint found that it had become a bit less of a one-way street to losses. Realistically the market today is almost the exact opposite of the market in the late 1980s and early 1990s. Mintages have been much lower and much more supportive of prices. The best example of this, of course, is the bimetallic Library of Congress $10 in 2000 where we now see a BU at $4,500 and a proof at $1,300. It is too early to tell with certainty what some others will do, but the general trend has been to higher prices and like the earlier pattern of lower prices that trend tends to remain until something dramatic comes along to change it.

For the collector now it becomes an odd mixture of some issues at high prices and others at prices based on bullion content. It all averages out to being able to form a gold coin collection at a decent price of a large number of very interesting gold coins. The collection is a great deal of fun. Some designs are like the initial Los Angeles Olympic $10, which many do not really like. Others, like the Elizabeth Jones $5 for the 1988 Olympics are in some minds exceptional art even if it is not priced exceptionally. The design choices are many and the opportunity is still there to assemble a complete set. With growing number of issues and the rising prices of some issues, the opportunity to complete a gold commemorative set may not last, but at least for now modern gold commemoratives are coins that almost everyone can value both as precious metal and as wonderful pieces of numismatic history.

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