$4,000 For An MS-65 Common Saint ?
GoldFinger1969
Posts: 1,877 ✭✭✭✭✭
It's coming....maybe by 2030 if gold hits my $3,000 target.
With the numismatic premium, you would have an MS-65 Saint-Gaudens common date (1924, 1927, 1908 NM) challenging the all-time high of about $4,000.
Remember....a rising gold price affects more than just plain bullion. 
0
Comments
I call bologna on your prediction.
Even if gold were to hit your $3000 target, it’s extremely unlikely that MS65 Saints would approach $4000. In order for them to do so, they’d need to trade at an even higher premium to gold than they do now. And in general, the higher the price of gold, the lower the numismatic premium for gold coins.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
@MFeld has a point about the premiums. Even right now, gold is up but the premiums are down and I'm buying saints for the same prices as a couple of months ago.
Founder- Peak Rarities
Website
Instagram
Facebook
I'd be shocked if MS65 Saints are lower than $4k by 2030. They'll get most of the way there just by tracking inflation.
OP mentions an MS65. A quick check of GC past auctions shows that in 2022 the 1927's were selling for $3600 (multiple coins). Currently two are listed at $3000. That is roughly a 1.5 times melt (approx). If gold goes to $3000 then a $4000 price tag is a lower premium (1.33 times melt) and could happen. I am not will to say no chance.
I don't think MS63/64's will do that but MS65's are possible.
Successful BST with BustDMs , Pnies20, lkeigwin, pursuitofliberty, Bullsitter, felinfoel, SPalladino (CBH's - 37 Die Marriage's)
$5 Type Set https://www.pcgs.com/setregistry/u-s-coins/type-sets/half-eagle-type-set-circulation-strikes-1795-1929/album/344192
CBH Set https://www.pcgs.com/setregistry/everyman-collections/everyman-half-dollars/everyman-capped-bust-half-dollars-1807-1839/album/345572
GC comps are not a good metric to gauge the market for widgets like common date saints, most people don't send them to GC because the 10% juice is more than the typical buy/sell spreads offered by wholesalers. Typically, non-cac gem common dates trade around 400-500 over melt, give or take and what @mfeld is saying is that if gold its 3k, there's a high probability that the premium would shrink even more.
Founder- Peak Rarities
Website
Instagram
Facebook
With gold at $2040, Upstate is selling MS-65 Saints for $2435. Even if the premium didn't shrink, that translates to $3500-ish for $3000 gold. MS65 Saints are not rare coins and I don't see a $1000 premium.
[I also don't think you'll see $3000 gold, but that's a discussion for a different thread or forum.]
The average selling price of common date MS65 Saints last year was significantly below the $3600 number you mentioned. And even now, with gold near recent highs, they can be obtained for at least a few hundred dollars less than the $3000 you referenced in two current listings.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
I stepped away from gold for a bit to collect CBH's. I was not aware I could buy PCGS MS65CAC or CACG MS65 Saints for $2400-2500. I need to start looking again.
Successful BST with BustDMs , Pnies20, lkeigwin, pursuitofliberty, Bullsitter, felinfoel, SPalladino (CBH's - 37 Die Marriage's)
$5 Type Set https://www.pcgs.com/setregistry/u-s-coins/type-sets/half-eagle-type-set-circulation-strikes-1795-1929/album/344192
CBH Set https://www.pcgs.com/setregistry/everyman-collections/everyman-half-dollars/everyman-capped-bust-half-dollars-1807-1839/album/345572
Not CAC, we were talking about regular MS65 saints.
Founder- Peak Rarities
Website
Instagram
Facebook
Oh, I was not....
Successful BST with BustDMs , Pnies20, lkeigwin, pursuitofliberty, Bullsitter, felinfoel, SPalladino (CBH's - 37 Die Marriage's)
$5 Type Set https://www.pcgs.com/setregistry/u-s-coins/type-sets/half-eagle-type-set-circulation-strikes-1795-1929/album/344192
CBH Set https://www.pcgs.com/setregistry/everyman-collections/everyman-half-dollars/everyman-capped-bust-half-dollars-1807-1839/album/345572
You didn't specify CAC. I guess we should have guessed from your handle. 😀
Mark, my prediction may or may not happen, I concur....I think the odds are more IN FAVOR than not hitting it. I think gold has been basing around $1,800-$2,000 for the better part of a decade-plus. I think we can liftoff to the next millenia mark any time.
If it DOES happen....I suspect that unless folks are enamored with BitCoin (maybe) or silver (doubtful)....you'll have a bit of a buying frenzy in gold and gold-related coins. I think a 33% premium for MS-65 Saints is not outlandish given past premiums in more normalized times. I'm not talking about when premiums were 200-500%, either.
If Gold does approach $3,000 even a very skinny 15-20% premium implies $3,500 or so. So I don't think $4,000 for MS-65's is outlandish if gold hits $3,000.
BTW, why did I create this thread ?
Aside from generating some posting interest and some stimulating back-and-forth.....I really do think the supply/fundamentals favor gold moving substantially higher over time. BitCoin has probably derailed some of the move upward in gold, just as in past years/decades the buying of Treasury bonds during turbulent times sucked $$$ away from the gold trade. But more and more central banks are buying....more newly created middle-class consumers in China, India, and other countries are buying more gold per capita when they make $30,000 a year than when they make $3,000 a year.
So.....I occasionally see people moaning and whining about not having bought gold or gold coins like Saints before the 2019-20 liftoff....or the rise from the Great Financial Crisis of 2008...or even the late-1990's when gold got crushed below $300 as everybody flooded into stocks and tech.
Thus....I figured I would post this thread NOW rather than post within other threads and have folks miss it and say "Damn, I wish I had seen that years ago when gold was ONLY $2,000 an ounce."
OK, you've all been warned.
Frank, I have just three questions for you😉:
1) When was the last time that MS65 Saints traded at a premium of 30% or more over the price of gold?
2) What was gold trading at, then?
3) If gold hit $3000/oz., why would the coins trade at a higher premium than they did when gold was at a much lower level?
Edited to add: Please know that I realize it takes a lot less thought to take issue with a prediction of this type than it does to make one. And I enjoy your enthusiasm and your posts.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
Mark, I always welcome information and debating back and forth with you. That's how anybody including myself can learn so the sentiments are appreciated from this side of the aisle, too.
(1) I include some charts which show average MS-65 selling prices (one has the premium on it but only back about 25 years). If you can approximate the spot gold you can approximate the premium for the MS-65's.
(2) Gold prices on 1 chart....on the older one gold spent most of the period in the late-1980's about $450......low-$400's/high-$300's early-1990's.....$350 for most of the 1990's until the end of the decade.... low-$300's/high-$200's 1998-2001.....gold lifted off in mid-2001 from $270.
https://www.statmuse.com/money/ask?q=what+is+the+average+price+of+gold+1980-2023
Net-Net: Premiums were much higher than 30%, but as you said, the gold price was LOWER. I doubt you EVER see premiums from even non-bubble years when gold price is low being anywhere near those when gold price is HIGH. Total Cost seems more important than Premium Paid when buying gold coins including Saints.
That said....I don't think a 30% premium is outrageous in the context of a gold rise of 50% to $3,000. It COULD be slimmer....maybe 10-15%. But I would expect that premium on a higher gold price to only exist after YEARS of sideway trading and going nowhere. Not after a big rise. Think of the premium as a reflection of past and expected price volatility.
(3) I agree, Saints/gold coins will NOT trade at a higher premium when gold goes higher than when the gold price was much lower (both charts show that). It will be close to the premiums on Chart 2 since 2015 .....15-30%. Premiums were HIGHER when the gold price is lower (1998 onward) and I do NOT see those premiums coming back into play sans a coin or gold bubble. Again....you can get away with fat premiums when the price is lower...or a bubble is going on (i.e, 1989 Coin Bubble with premiums of 500-700%).
I guess it is POSSIBLE that if gold is $3,000 an ounce that Gem Quality coins might be at 10% or less premiums -- but I would doubt it especially if that gold price is hit on the way UP with lots of enthusiasm, retail participation, etc. It's one thing if it laid there for a decade and the premium dissipated. Plus, factor in dealer/auctioner costs/overheads and a bid-ask spread and $3,500 isn't a stretch and $4,000 could be within reach.
REGARDLESS of how big the premium is....it'll exist....and on top of a $3,000 gold price, you are looking at a huge increase from today's levels for Saints and other gold coins.
So get 'em while gold is closer to $2K instead of north of $3K.
Not interested in gold at the current price, let alone a higher price.
You can see the price was just about $4,000 during the 1989 Coin Bubble. Obviously, with gold about $450 during this time, the premium was in Nutsoville.
More recently, from about 2000-2020 you can see the gold price, MS-65 Saint prices, and the premium. Clearly, as the gold price rose, the premium came down bigtime. But even after years of declines and stable prices...low volatility....the premium for MS-65 Saints in 2015-20 never got much below about 20% premium.
Maybe that IS the "New Norm" when gold is alot higher but we'll have to see if the Gem Quality Premium will find a new equilibrium at the 15-25% range where it was the last few years (and is today ~ 20%)
As much as we'd like to know sooner, this debate won't be settled unless or until gold hits $3000/oz.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
I wouldn't hold my breath. People have been calling for $3000 or even $5000 gold for decades. Lost in the gold lust is the simple fact that the vast majority of gold usage is discretionary. How much gold jewelry will get sold at those prices?
Short of hyperinflation, I don't see gold getting to $3000 any time soon. And in such an inflationary environment, I have no interest in Gem Saints.
FWIW, more apropos of the WSJ thread, I got a call from Finest Known. They are selling AU Type 1 Liberty $20s for $2000. Their pitch was similar to the OPs post: gold is posed to move to $3000 and then my Type 1 $20 will go to $5000. I politely declined.
I'm late to this party and haven't checked recently. What are PCGS/CAC MS65 Saints (generic) selling for these days? IMO they'd have to be well over $3,000 now if they were going to be anywhere near $4,000 with gold at $3,000.
Thanks for the interesting thread. I haven't read one like this in a few years.
Here's my 2 cts or should I say $20 gold piece.
Can gold hit $3000 by 2030? Sure. I don't believe a bit of inflation will be the catalyst. You'll need a lot of inflation.
it Would not be good for economic system? Who are the big buyers today? My guess...central banks. Without them, at what price would gold be selling for today? I'm not sure the public (US in particular) cares about gold? The stock market has been very good so that sucks up all the speculative investment dollars. Bonds have been the portfolio stabilizer (until recently). Commodities, over the past 40 years have been relatively "dead" with a few exceptions.
Gold and inflation may track over a much longer time but there is little correlation in the short term. A move to $3000 will need a catalyst (loss of faith in the credit based system, etc). If the masses feel the need to jump on commodities, gold will find itself in short supply as would any commodity. In such an environment, gold eagles could sell for an unheard of premium. Libs, saints, eagles, modern gold will all surge as physical would be in very tight supply. It will last until the high cost producers open up new mines and much more gold hits the market. Under such a scenario of shortages, I wouldn't bet against any call on coin premiums.
In the here and now, I'm trying to reconcile the continuing weakness of the miners and royalty companies. If gold was on the cusp of a major move, would the miners be such poor performers? In addition, would silver be trading at half the price it sold for as recently as 2011? Maybe there is a geopolitical bid in the physical market which might not last? IN any event the ST has me a bit perplexed.
Yup.
My ex-PB contacts and associates tell me they are getting more institutional inquiries about gold (and BTC
) from places that never did before (i.e, colleges). Add in central bank buying, newly-created middle class buying in emerging economies (i.e., India) and you have lots more demand and little supply.
It takes larger and larger Central Bank dumping -- the last big holders -- to impact the price today. The U.S., France, Italy, Germany, and Russia are the largest holders and NONE appear to want to sell let alone dump. The rest of the central banks are not large enough unless they blew out of most of their holdings.
In other words....gold is in STRONGER hands which bodes well for more gains.
Most of the carnival barkers are perma-bulls who always are making idiotic predictions in hopes of being this decade's Howard Ruff. I focus on long-term supply and demand factors. The traditional supply and demand sources, plus new ones, are all very bullish...plus we have based at about $1,500-$2,000 for over a decade more or less.
Only fly in the ointment is BitCoin.
Look at the long-term demand increase in gold consumption for 1 country, India. Now add in that their per-capita GDP the next 10 years will be DOUBLE or TRIPLE what you see in these charts and EVERY YEAR they will move 10 million people from poverty to middle-class status.
Annual Indian gold consumption over the decades:
This is one country....now add in a few billion more from China, Vietnam, Bangladesh, Pakistan, Africa, South America, etc.
Theirs is a pitch, mine isn't.
You should have asked why a common Liberty DE which today sells for bullion value will in the future sell at a 66% premium to gold (assuming a $3K gold price) which is NOT what I am talking about (I'm talking about numismatic coins like MS-65's).
But I agree you made a good move declining.
With CAC ? I'm going to say the 1924's/1927's are about $2,500 give-or-take though I haven't checked closely in a few weeks. Figure $2,300 without the CAC.
It appears the premium boost for CAC coins has faded with the new grading service plus the expectation that if a coin were to upgrade with the CAC sticker, it would have done so already (i.e., it's gonna stay at the current grade).
Thanks for contributing and the thanks. I do lots of reading and posting about Saints because I find it less expensive than buying them !!!
I had to look when I saw AU Type 1's for $2000. Went to Finest Known website and the cheapest AU $20 Type 1 was $3370 and most were $5000 or more. At $2000 I would be a buyer of a lot of Type 1 DE's that are graded AU.
Successful BST with BustDMs , Pnies20, lkeigwin, pursuitofliberty, Bullsitter, felinfoel, SPalladino (CBH's - 37 Die Marriage's)
$5 Type Set https://www.pcgs.com/setregistry/u-s-coins/type-sets/half-eagle-type-set-circulation-strikes-1795-1929/album/344192
CBH Set https://www.pcgs.com/setregistry/everyman-collections/everyman-half-dollars/everyman-capped-bust-half-dollars-1807-1839/album/345572
Let's look at just India. Their demand increase is largely jewelry. So, again, you have to consider the elasticity of that demand.
I honestly felt it was a good price. But I did not want to encourage further phone calls so I did not pursue the call long enough to find "the catch".
BTW for you VB fans out there, the only reason Finest Known had my info is because I bought a couple VBs from them.
They also called before VB4 to see if I was buying those. Based on the background noise, they have an active call center.
Historically, the premium on MS 65 Saints was hugely inflated during the late 1980s. PCGS started grading in 1986 and NGC in 1987. There simply weren't enough MS65 saints certified to satisfy demand during the first few years, so premiums were quite high. Add the fact that the 1980s MS65 coins really had to be today's 66s or 67s and the supply was even smaller.
Most MS 65 gold type today sells for less than it did in the early certification days due to two factors. First: change in grading standards and second: ever increasing populations of certified coins in any given grade.
Excellent points. I would expect that as per-capita income/GDP doubles or triples in 10 years that consumption will go UP. Plus gold as an investment....plus non-wedding buying....plus central bank and government buying plus industrial buying.
Even if it only doubles in the aggregate from the 1990's, that is 1,500 tons a year instead of 700 tons a year.
What happened to U.S. consumption of gold when the prohibition against ownership was repealed in 1975 ? It took off.
Even at $3,000....gold is more affordable to a middle-class consumer than gold is affordable to a low-income person when it is $1,500-$2,000. Not much gold is bought in this country by people on public assistance, right ?
Yup, agree with all of this. Check the price/premium charts above and you will see that it is only recently that premiums for multiple years have been under 25-30% for MS-65's.
No way do I see bubble-like premiums in excess of 100% coming back anytime soon....even premiums of the last 20 years for 50-100% are likely too high.
It is possible that as gold goes higher, Mark is correct: the premium could "normalize" in the teens and thus gold at $3K would translate to MS-65's at ~ $3,300. But I think the premium, bid-ask pricing, etc. would translate to dealers and buyers driving the price higher.
The one thing that would tend to keep a lid on premiums would be increased use of the Internet and online auction sites which in theory reduce price friction and increase price transparency and turnover times....thus making holding coins/gold less risky and requiring a smaller premium.
Just a theory....like Mark says....we have to see how it all plays out as gold does move higher (of that I am much surer about).
In order to double in the aggregate, you need at least a factor of 2x increase in Indian GDP over 6 years. That is a 13% annual growth in GDP. [Ignoring currency fluctuations.] India is currently at about half that for its growth rate. If their 7% annual GDP growth rate continues, you'd need about 10 years for a 2x increase in Indian GDP.
Do you have a source for U.S. consumption of gold. What I found was disappointment in 1975 per the NY times:
https://www.nytimes.com/1975/12/31/archives/gold-rush-in-us-didnt-plan-out-buyers-have-lost-as-much-as-30-on-in.html
I couldn't find a chart of U.S. only demand. However, if you look at the global gold demand, what you see is declining demand during times of rising prices. Note the late 1970s and then the period after 2000.
This speaks to the demand elasticity that I mentioned.
I saw some crazy high prices realized at a Stacks auction a few days ago. And it was not just gold. A lot of seemingly common Indian head cents went for more than double trends in RB.
BST transactions: dbldie55, jayPem, 78saen, UltraHighRelief, nibanny, liefgold, FallGuy, lkeigwin, mbogoman, Sandman70gt, keets, joeykoins, ianrussell (@GC), EagleEye, ThePennyLady, GRANDAM, Ilikecolor, Gluggo, okiedude, Voyageur, LJenkins11, fastfreddie, ms70, pursuitofliberty, ZoidMeister,Coin Finder, GotTheBug, edwardjulio, Coinnmore, Nickpatton, Namvet69,...
When comparing historical numbers, has anyone factored in gradeflation?
RIP Mom- 1932-2012
We try. It's hard. LOL.
For Gem quality gold, you don't even need gradeflation to have a complex situation. There's also supply increases that are separate from gradeflation which could also increase 65 supply. Over the last 20 years, more and more gold has been graded and so the supply of MS65 common date gold has been steadily increasing.
That's an interesting tidbit you shared. I'm kind of surprised you actually got involved with VB.
Now that it's clear that a lot of product is seemingly being moved by a boiler room like Finest Known, that really does shed some light on how they manage to keep selling out, and who they are selling to. The same people who take investment advice from Richard Petty, Chuck Woolery or William Devane on cable TV.
You are clearly not in that demographic, so it's a little surprising you allowed yourself to get swept away by the FOMO. You really should consider taking a step back and objectively examining just who and what those guys are all about. You saw it immediately with $2K DEs. VBs ARE $3500 AU generic DEs. Same salespeople working for the same commissions. One is obvious to you while the other is harmless "fun." It's just amazing that you don't see it.
Funny, but the Mint didn't have a marketing company placing outbound sales calls ahead of any of its releases this year. They also don't bait and switch anyone on anything. I'm quite sure VB's marketing partner cannot say the same. In fact, no reputable company engages in that tactic at all. Up selling is one thing. Bait and switching is something else altogether.
Per-capita income would expand FASTER than GDP over a sustained period of time. You can see this in the U.S. NIPA accounts put out by BEA.
Also, GDP and income aren't distributed equally. The Top 25% of the population of India (~350 million people) might see their per-capita income grow 15-20% annually...maybe more ! Think of how tech or social media workers incomes have grown the last 5-10 years compared to before 2013.
We saw this with China from 2000-20, as GDP growth averaged about 8% but consumption and income grew much faster.
Interesting article. Didn't know Senator James Buckley (William's brother), who just died at age 100, was the 1st person to buy gold on December 31st, 1974 right after midnight.
Ironically, the article validates what we know: when prices were LOW, people didn't want gold. No doubt they went nuts for gold when the price had quadrupled 5 years later !!
I know 1 person who wanted to buy back then.....ME !!!!
I wanted to buy a 1-ounce Krugerrand but my parents wouldn't let me. I believe gold or the coin was about $180 at the time. Must have been sometime in 1975.
Notice that total gold supply has barely DOUBLED in 38 years, whereas consumption has increased far more than that. At some point, gold starts moving up again and don't discount the possibility of a few days of $100-$300 up moves.
https://www.gold.org/goldhub/research/gold-demand-trends/gold-demand-trends-full-year-2021/16764
In the SHORT-TERM, that is certainly true. But over LONGER periods of time, new buyers, increased wealth, and people being accustomed to the higher prices means gold demand goes up.
Gold is over 10x the price quoted in the article....but demand is much much higher in this country and globally.
Yes, in the short-term, for sure. But more buyers means more demand and I don't see institutional or investment/speculative or central bank demand listed there -- they will more closely approximate jewelry demand.
Note also how developing market jewelry demand has increased far more than in developed markets. This is consistent with my per-capita GDP/income statements above.
Actually, I see more Saints and gold coins going without bids on GC and Ebay. Asking prices are just too high. I think when the price is set reasonably or with No Reserve, then you see spirited and active bidding. But I see lots of nice Gem and Superb Gem Quality Saints from MS-65 to MS-67 with the prices set too high, maybe 15-20% too high.
I never understood that since anybody likely to buy a coin like that at the FMV certainly knows the market and with the coins not unique (i.e, MS-67 1924's or 1908 NM's) you can't overask by $1,000 or more and expect someone to bid.
Maybe they hope someone is The 1 Dumb Bidder.
Fair point, but impossible to incorporate into the anlaysis.
But you can see the dichotomy pre- and post-TPGs in the prices for MS-63s and MS-65 in Roger Burdette's price matrix for every Saint Double Eagle in his book. He has a nifty price-chart going back to 1976 I believe based largley on the Heritage Archives.
Who or what is "VB" ??
Vault Box.
You must be new
Vault Box.
You must be new> @GoldFinger1969 said:
You have to assume increasing disparity in order for that to be true.
Disparity of what ? Inside developing markets...or between developed vs. developing markets ?
Income inside India. You are trying to create a multiplier for income to generate gold sale increases greater than GDP or income increases. I think that only works if there is widening wealth disparities within India. Otherwise you just have the whole distribution moving up uniformly and, barring a change in gold tastes, a uniform increase in gold consumption.
I think it is far more likely for increasing gold prices to dampen demand, as it has in the past, than for a wealthier India buying even more of a more expensive decorative item.
Wat a long thread !
The guy who spelled baloney correctly had it summed up an hour ago
Picked up a nice lustrous 1927 PCGS 65 Saint for $2300 walkup customer at recent show offered to me at my table. Just laid out the Bens. Very nice and lustrous. I sold it later in the show for $2700 to a nice, very sharp young woman who is a para legal.
Nice trade.
I think that if GDP grows 7-8% a year for the next decade in India -- a big IF, I admit (they've screwed up other opportunities in the past) -- you have tens of millions of consumers who will see their incomes grow much FASTER than the underlying GDP growth rate. Disposable income increases at an accelerating rate, too.
Go back to my Indian demand over the decades numbers. Even a mere doubling is another 750 metric tons annually. And Central Banks (including Indias) are buying not selling.
Gold to me is like a big beach ball being held under the water line. Eventually, it's going to really pop up.
This will always be true, but as long as income and disposable income rise, demand goes up. I would buy a ton more gold today if the price collapsed to $1,000 an ounce....but if it ROSE to $2,500 an ounce and I won MegaMillions, I'd probably buy even more.
I think that happens. I think "income inequality" may increase because instead of EVERYBODY or MOST people being poor, rapid GDP growth lifts all boats but lifts some much more than others.
So again...I don't think this is an impediment to more gold buying from India, and the multi-decade data I supplied probably confirms it (and that was when India didn't really kick-ass GDP growth-wise).
It will definitely be fascinating to see if India can take a page from China's playbook and see where they are by 2035. And the trends should be known by 2030 and thus my gold forecast.
Nice move....I don't have a dealers mentality so let me ask: did you buy that coin on the cheap relative to FMV or did you just sell it at a rich premium to FMV ? A $400 spread on a common Saint seems very nice.
Seems you sold it for a really rich price rather than got it on the cheap.
The price of gold isn't based upon its utility. If it was, it never would have reached 1980 or 2012 prices.
It doesn't take hyperinflation to generate a much higher price. The price run-up after the October 2008 low of $680 was in anticipation of much higher price inflation which never materialized from QE "printing".
I think gold is relatively overpriced, compared to other physical goods and probably many services. It's definitely not cheap compared to other commodities, including silver.
Still looks like it is "breaking out" past chart "resistance". Whether it does or doesn't, its price isn't contingent upon any "fundamental". It's psychological, what people believe, not anything that happens or doesn't.