By Steve Roach – First published in the October 4, 2010, issue of Coin World

With all this interest in gold and the mainstream attention it is getting, one would think that generic gold coins would be blazing hot. Yet, many of the most popular issues trade at heavy discounts to earlier in the year when gold was trading at the $1,100 an ounce level.

The coins that investors typically flock to during bullion run-ups, Saint Gaudens $20 double eagles and Coronet double eagles, are trading at substantial discounts to what they were trading for at the start of the year.

For example, one major wholesale market maker at the close of 2009 was selling certified Saint Gaudens double eagles for $1,660 in Mint State 62, $1,820 in MS-63, $2,070 in MS-64 and $2,580 in MS-65. Today, that same dealer is selling the coins at $1,550, $1,590, $1,660 and $2,080 in the same grades respectively.

Other gold series are experiencing declines at the wholesale generic level, as market makers are not taking large positions in these coins, but $10 eagles and double eagles have suffered the worst declines.

Earlier this year one dealer was selling Indian Head eagles in MS-64 for $2,470; today the same dealer is selling them at $1,580.

In general, the only generic gold coins that have gained value this year are circulated coins, which are dependent on bullion prices for value.

In light of rapidly increasing gold values, one wonders how much longer these discounts will persist.

The recent announcement that the Mint intends to release Proof 2010-W American Eagle gold coins has put a further chill on the market for earlier Proof American Eagle gold coins.

In the Aug. 30 Market Analysis, I reported that major market-maker buy prices for the earlier coins with original Mint packaging had fallen to $1,750 an ounce, down from $2,000 an ounce.

As of Sept. 16, many of the market-makers have dropped out of the market and the few who remain are buying the earlier coins for as low as $1,575 an ounce, with the highest price being a small order at $1,600 an ounce.

Visit Steve’s Rare Coin Market Report Blog at http://coinmarketreport.blogspot.com/

By Vic Bozarth – Rare Coin Road Warrior
This is a NEW Monthly Column by Vic Bozarth, the “Rare Coin Road Warrior” who spends over 200 days a year traveling to Coin Shows. We hope you enjoy Vic’s unique perspective on the coin collecting and the rare coin Market. – Editor

Hi, my name is Vic Bozarth and I am a Rare Coin Road Warrior. My wife Sherri and I own Bozarth Numismatics Inc. Our website is Bozarthcoins.com. Last year we spent over 200 days on the road on nearly 45 different trips. As a professional numismatist and buyer for other companies I have been a ‘rare coin road warrior’ for nearly 25 years. My wife and I attend all major coin shows, as well as most large regional or state coin shows.

Many fellow numismatists and collectors have expressed an interest in hearing about our experiences during our coin show and buying trips. Recently I decided to write a short article each month on the shows we attend as well as the coin buying trips we take to different cities across the United States.

Buying NICE rare coins at reasonable prices becomes more difficult each year. There are a lot of logistical and security considerations we have to plan for with every trip. Not only do we have flights to book, but we also have to find a comfortable and safe hotel or motel preferably close to the show. If we have appointments with customers or other dealers we often rent a car. Those are most of the logistical considerations. Security is the biggest concern. We do have one big advantage. Because we are most often able to travel together, one of us can always watch the coins. We never leave our coins unattended.

Although we have tables at most shows, sometimes I buy an ‘Earlybird’ dealer badge and just attend a show by myself to buy only. During weeks with no major shows, we often fly to a major city and ‘hit’ the shops and offices of the coin dealers in that area. Over the years, I have visited virtually every major city in the continental United States at least once. Fortunately both my wife and I love to travel, because the schedule can be grueling.

Last week we attended the Illinois Numismatic Association show in a suburb of Chicago called Tinley Park. A couple of days before the show we flew in to Detroit, rented a car, and did some business with other dealers on our trip west to Chicago. We really enjoy these trips. Although we experienced a flight delay out of Houston due to bad weather from a tropical storm in the Gulf of Mexico, we were able to see several dealers in Michigan before arriving at the ILNA show in Tinley Park.

The weather in Michigan and Chicago is gorgeous this time of year. The summer heat has softened and the nights are cool and comfortable. The folks with the ILNA Show did a great job in putting on the show despite the construction to enlarge the current convention center in Tinley Park. ILNA moved to this location a couple years ago. They are to be commended for running a good show in a location that has both safe and reasonably priced lodging and good restaurants.

Business on the bourse floor is always busy during dealer set-up. Getting ‘first shot’ at someone’s inventory is the prize for those lucky enough to get there first. Basically ‘first shot’ is what we dealers refer to as the person (usually a dealer) who gets to look at another dealer’s inventory before any other dealer looks. Often times you will hear, ‘Joe got first shot, but I still want to look’. Many dealers attend only a few shows a year and their inventory is ‘fresh’ to other dealers. They have often purchased coins from collections or estates that other dealers haven’t seen, thus the desire to get ‘first shot’. (more…)

By Vic Bozarth – Bozarth Numismatics
Vic is our Newest CoinLink Content Partner. He will be providing Regular Market Reports and articles

As I write this on Labor Day 2010, I can’t help but reflect on the trends I have seen in the coin business over the last 25 years. Generally speaking the coin business during the Summer months, June through August, is flat. Of course, the ANA Show highlights the Summer show schedule, but other than the marathon it has become, the other shows are somewhat sparsely attended and well ‘flat’. With only a couple of exceptions, the Summer doldrums have lived up to their name. People are on vacation, taking time off, and hopefully spending some time with family and friends. Thank goodness Summer is over. Let’s do some business.

Business picks up during the Fall and early Winter months. Folks are done with their vacations, the weather is forcing them inside, and the coin market recognizes this most years and gets more active. We are already starting to see this trend in the bullion markets.

The two big questions you should focus on are: Where is the business going this Fall? How can you best take advantage of the market as it stands right now?

Gold and Silver bullion prices are moving up. While we specialize in rare high grade U.S. coins, we recognize and believe that bullion prices will continue to rise. How can you take advantage of this trend. U.S. gold coins are a great way to both hold and invest in bullion and take advantage of the low premiums that they currently carry in relation to their historic price levels. Let me illustrate this with an example.

During the last couple of months of 2009, gold bullion price levels bounced around $1200 per ounce. The ‘blue’ chip U.S. gold type coins that are most bullion sensitive, $10 and $20 gold coins, were extremely active.

The market peaked in late 2009 and to illustrate this I have listed wholesale price levels for actively traded gold coins then vs. now. Note the difference in the price of gold itself.

2009 Spot Gold $1195/ounce ……… 2010 Spot Gold $1250/ounce

What I am trying to illustrate is how ‘demand’ can really affect the wholesale price levels of coins, especially gold. During late 2009 there were some major institutional orders for these type of coins. This pushed demand/prices up and we sold into this peak of the market. Currently U.S. type gold coins are trading for significantly less yet the price for gold bullion is nearly $1250 per ounce. Do you see the disparity? (more…)