Face value of gold coins - questions
Ciccio
Posts: 1,405 ✭
Sorry if these questions make no sense. They just popped out of my mind
Yesterday I was showing my wife the 1/10 Gold Kangaroo received in the mail and she asked: why does it have a face value of AUD15 if gold is worth more than that?
It only came in my mind that the gold was once reflecting the actual face value of coins and since they are still considered legal tender they need to have the face value.
But why the gold bullions still have the face value? And what difference makes if a coin is legal tender or not (just for commerce purposes)?
Since we are talking about confiscation once again. If this happens (I doubt it), will the US Government be able to confiscate foreign gold bullions?
I see it like, the US Govt tomorrow decides to confiscate all the Euro bills in the US. Wouldn't that piss the EU off?
Thanks for your replies.
Yesterday I was showing my wife the 1/10 Gold Kangaroo received in the mail and she asked: why does it have a face value of AUD15 if gold is worth more than that?
It only came in my mind that the gold was once reflecting the actual face value of coins and since they are still considered legal tender they need to have the face value.
But why the gold bullions still have the face value? And what difference makes if a coin is legal tender or not (just for commerce purposes)?
Since we are talking about confiscation once again. If this happens (I doubt it), will the US Government be able to confiscate foreign gold bullions?
I see it like, the US Govt tomorrow decides to confiscate all the Euro bills in the US. Wouldn't that piss the EU off?
Thanks for your replies.
0
Comments
I think it's law that all U.S. coins are to have some kind of face value number visible on the coin.
Too many positive BST transactions with too many members to list.
<< <i>I think it's law that all U.S. coins are to have some kind of face value number visible on the coin. >>
If it doesn't have a face value, how can it be a coin?
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
Confiscation and other severe measures tend to happen when war comes. People tend to be pissed off when at war and killing each other.
Mexican Libertad
Groucho Marx
<< <i>There is only a single goverment made coin that has no face value. >>
I read that's because they intended it to circulate one of these days.
This could only work effectively if not tied to the Peso.
<< <i>There is only a single goverment made coin that has no face value.
Mexican Libertad
>>
It's splitting hairs, I'm sure, but the Krugerrand has never had a face value. It's intended to circulate at the value of 1 oz of gold.
The currency of South Africa is the Rand. At ~$1230 an ounce, a Krugerrand is "worth" about 9,500 Rands.
--Severian the Lame
The Mexican libertad doesnt have the word "peso" anywhere...
I guess its really splitting hairs ..lol
The issue of "face" value on bullion coins comes up often and while completly irrelevant in the real world, i guess it makes bullion seem more legit somehow.
the US medals were poorly recieved and they are hardly even mentioned.
The comical side of face value are the US eagles ...5$ for a 1/10 and 10$ for a 1/4 ....that never made any sense to me at all.
Groucho Marx
Groucho Marx
<< <i>The gold sovereign and its multiples/fractionals have no face value. There are MANY coins with no face value. >>
Just because it's not shown on the coin doesn't mean it doesn't have a face value. The face value is the sovereign or fraction thereof.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
<< <i>
<< <i>There is only a single goverment made coin that has no face value.
Mexican Libertad
>>
It's splitting hairs, I'm sure, but the Krugerrand has never had a face value. It's intended to circulate at the value of 1 oz of gold.
The currency of South Africa is the Rand. At ~$1230 an ounce, a Krugerrand is "worth" about 9,500 Rands. >>
The official face value was one kruggerrand.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
<< <i>
<< <i>The gold sovereign and its multiples/fractionals have no face value. There are MANY coins with no face value. >>
Just because it's not shown on the coin doesn't mean it doesn't have a face value. The face value is the sovereign or fraction thereof. >>
By that standard only random lumps of metal don't have a face value.
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<< <i>
<< <i>The gold sovereign and its multiples/fractionals have no face value. There are MANY coins with no face value. >>
Just because it's not shown on the coin doesn't mean it doesn't have a face value. The face value is the sovereign or fraction thereof. >>
By that standard only random lumps of metal don't have a face value. >>
Medals and bullion rounds don't have a face value. Do you consider them to be random lumps of metal?
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
<< <i>Yesterday I was showing my wife the 1/10 Gold Kangaroo received in the mail and she asked: why does it have a face value of AUD15 if gold is worth more than that? >>
People have covered why there is a face value.
As for why it is less than the value, it needs to be. If the face value was AUD$1,000,000, you could spend it in Australia the same as you would $1,000,000 cash -- so the government would have to sell them for $1,000,000 or more. If they used the value of gold the day it was minted (or something close to it), and gold went down in value, people would spend them. So the goal is to get a face value such that it is unlikely that the gold content will become less than the face value.
But, the face value component was interesting before the prices started rising, about 10 years ago. You could buy some coins that were close enough to face value that you were guaranteed not to lose more than a certain percentage of your investment (OK, yes, that's still true today, but the numbers were high enough that there was real benefit).
1. Condition the masses that gold is worth closer to the "official" stated treasury value ($42/oz) than the market value ($1200/oz). Even when these first came out in the mid-1980's an oz of gold was worth $300-$500. In other words....keep the masses in the dark as to gold's value. The program has worked pretty well.
2. In the event the govt should ever want to go back and "acquire" these coins from the public, the face value is stated right on the coin. $50 might be all they would agree to pay for them following a confiscation decree. Still, that's a hefty 19% higher than the Treasury stated value of $42!. What's not to like?
roadrunner
<< <i>
<< <i>Yesterday I was showing my wife the 1/10 Gold Kangaroo received in the mail and she asked: why does it have a face value of AUD15 if gold is worth more than that? >>
People have covered why there is a face value.
As for why it is less than the value, it needs to be. If the face value was AUD$1,000,000, you could spend it in Australia the same as you would $1,000,000 cash -- so the government would have to sell them for $1,000,000 or more. If they used the value of gold the day it was minted (or something close to it), and gold went down in value, people would spend them. So the goal is to get a face value such that it is unlikely that the gold content will become less than the face value.
But, the face value component was interesting before the prices started rising, about 10 years ago. You could buy some coins that were close enough to face value that you were guaranteed not to lose more than a certain percentage of your investment (OK, yes, that's still true today, but the numbers were high enough that there was real benefit). >>
Several coins ran into this problem, so countries learned not to have the face value close to the bullion value for NCLT (non circulating legal tender many times commemoratives). One example that comes to mind are the 1976 Olympic coins from Canada with a face value of $5 and $10. When silver dipped low, the face value was considerably more than the silver value and some folks took them to the bank to cash them in, or deposit them. There are more examples.
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<< <i>
<< <i>
<< <i>The gold sovereign and its multiples/fractionals have no face value. There are MANY coins with no face value. >>
Just because it's not shown on the coin doesn't mean it doesn't have a face value. The face value is the sovereign or fraction thereof. >>
By that standard only random lumps of metal don't have a face value. >>
Medals and bullion rounds don't have a face value. Do you consider them to be random lumps of metal? >>
Medals, yes. Rounds, no. Neither one of them is a coin.
<< <i>I think it's law that all U.S. coins are to have some kind of face value number visible on the coin. >>
The earliest US silver coinage had no value marked on the coins either.
HH
1947-P & D; 1948-D; 1949-P & S; 1950-D & S; and 1952-S.
Any help locating any of these OBW rolls would be gratefully appreciated!
<< <i>In the event the govt should ever want to go back and "acquire" these coins from the public, the face value is stated right on the coin. $50 might be all they would agree to pay for them following a confiscation decree. Still, that's a hefty 19% higher than the Treasury stated value of $42!. What's not to like?
>>
i'd probabably get in the "Bank of China" line, behind the B&M...
or melt it and get a few MLB necklaces made
*edit* NM. Guess they lost money on what they bought the gold at vs its bullion value when it was returned to them
http://www.gold-eagle.com/editorials_01/thies080301.html