We received this email today which you may find interesting.

It was a slow day in a little East Texas town. The sun was beating down, and the streets were deserted. Times were tough, everybody was in debt, and everybody lived on credit…..

On this particular day a rich tourist from back east drove through town. He stopped at the motel and laid a $100 bill on the desk and said he wanted to inspect the rooms upstairs in order to pick one to spend the night.

As soon as the man walked upstairs, the owner grabbed the bill and ran next door to pay his debt to the butcher.

The butcher took the $100 and ran down the street to retire his debt to the pig farmer. The pig farmer took the $100 and headed off to pay his bill at the supplier of feed and fuel.

The guy at the Farmer’s Co-op took the $100 and hurried to pay his debt to the local prostitute, who had also been facing hard times and had to offer her “services” on credit. The hooker rushed to the hotel to pay her room bill with the hotel owner.

The hotel proprietor then placed the $100 back on the counter so the rich traveler would not suspect anything.

At that moment the traveler came down the stairs, picked up the $100 bill, stated that the rooms were not satisfactory, pocketed the money, and promptly left town.

No one produced anything. No one earned anything. However, the whole town is now out of debt and now looks to the future with a lot more optimism.

And that, ladies and gentlemen, is how the United States Government is conducting business today.

By Doug Winter – RareGoldCoins.com

I recently bought and sold a seemingly innocuous 1859-D quarter eagle that had a great degree of numismatic significance. Before I explain why, let me give you a little background on the specific coin and on this issue in general.

This 1859-D quarter eagle has been graded as Fine-15 by PCGS. It is the single lowest graded example of this date seen by either service. In looking back through my records, I have seen very few that grade below Extremely Fine and certainly can’t recall a non-damaged Fine example.

The example I sold is problem-free and actually quite attractive despite its extensive wear. It shows nice natural coloration and the obverse is a full Very Fine from the standpoint of detail.

This is the final quarter eagle produced at the Dahlonega mint. But, for all intents and purposes, the death knell for this denomination at the Dahlonega mint had been spelled as early as 1854 when mintages figures declined precipitously from the 1840’s. In 1856, only 874 were struck; making this the lowest mintage figure of any coin ever produced at this branch mint. In 1857-D, the mintage increased to 2,364 but no quarter eagles were made in 1858. 1859 saw a resumption of the denomination but only to the tune of 2,244 coins. None were struck in 1860 and when the mint closed in 1861, no further plans had been made to coin quarter eagles.

The 1857-D and 1859-D are interesting issues among the quarter eagles from this mint. The grade distribution is different for these issues than for nearly all other coins from Dahlonega. The coins from the 1840’s and early 1850’s have what I regard as a typical distribution of survivors: most are in the VF-EF range with AU coins being scarce to rare and Uncirculated coins being very rare to extremely rare.

But in 1857 and 1859, the distribution curve looks different. These two dates are almost never seen in grades below EF and are most often seen in About Uncirculated. Both are rare in Uncirculated but not as much so as their very low mintage figures would suggest. There are as many as ten Uncirculated 1859-D quarter eagles known as well as another four or five dozen in About Uncirculated. This doesn’t seem like a lot of coins but when you consider that there are only 150 or so known from the original mintage, the fact that nearly half grade AU or better suggests that this issue didn’t circulate as freely as the quarter eagles from the 1840’s.

I had long believed that the 1859-D was an issue that saw very little circulation. The existence of the coin shown above is proof that at least a few examples did circulate. I don’t believe that this Fine-15 example was a pocket piece as it shows all the hallmarks of extensive natural circulation. Ironically, it is more rare in this grade than it is in Uncirculated and, to my way of thinking, this is one of the neater Dahlonega quarter eagles to have come up for sale this year: a highly circulated example of a date that was hitherto believed to have never seen extensive circulation. Considering that this coin cost its new owner well under $2,000 I think it is an amazing piece of Southern gold history.

By Pinnacle Rarities

Gold Closes Up, But the Myth Lives On

Before last week’s convention, I had a discussion about the myth referred to as the “Long Beach Curse.” The prevailing sentiment is that the spot price of gold always goes down during the week of the convention. This phenomenon is often bantered amongst gold dealers deciding whether to load up or unload inventories around these major conventions. During last week’s show, gold touched an all time high, and settled on Friday about nine dollars up for the week seemingly debunking the myth. A quick review of spot prices for the last decade’s thirty shows reveals the trend has some statistical backbone. However, the true curse has been the lack of quality material available for purchase. And this isn’t limited to the Long Beach Convention.

Collectors have continued to cull their collections as economic uncertainty has caused many to tighten their belts. However, they sell off the lesser quality material first. Spending habits have become more selective with the prevailing market focused on value and rarity. When major collections and true rarities enter this market the best quality material is quickly absorbed. The dregs are then recycled through dealer inventories and the myriad of auction houses that also clamor for fresh material. But rest assured, if you’ve been selective in your purchases and your collection was purchased for the coins it contains and not the plastic that contains it, you’re in good shape. The rare coin industry is alive and well – with an emphasis on “rare.” Looking at auction records over the last couple years, it’s easy to see quality and rarity still rule in this hobby of kings.

Now, back to that myth. During the last decade the spot price of gold has gone from a $256 in 2001 to $1297 (the Friday close after the latest Long Beach). It’s hard to imagine during this meteoric rise that the price of gold in any given week faltered. But overall, there were 19 of 30 weeks that showed declines in spot gold during the Long Beach convention. During the first five years of the decade, the rate of down cycles was an astounding three of four shows.

The number of down weeks is a bit padded as several of the weeks with advances only showed modest gains of $2 or less. So if you left the show early, the spot price would have been theoretically down for that show also. Regardless, with over three quarters of the conventions showing weak or down trends, it is no wonder the rumors started. The last five years have shown an improvement on the trend, but gold was still down at more than half the shows (eight of fifteen had declines).

So there is some statistical indications as to how the Long Beach Curse gained acceptance. But again, the real curse is one we recognize with all numismatic venues. There is an extremely diminished amount of quality material. True rarities and top pop condition rarities are commanding strong premiums, while the more common and lesser quality stuff has fallen stagnate. This increasing shift in the supply and demand equation coupled with an ever stronger precious metal price makes the outlook for rare coins seem bright – if only we could find the more coins.

A quick note to thank all our customers who have recently sold us coins or collections. Many of these items were exceptionally rare and of high quality. Thanks to you we have avoided the curse.