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Record high spot prices and extant populations of Coins
cameonut2011
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So… in light of record high spot prices, what series are being targeted for the melting pot or are all common date coins pretty much on the chopping block from after the Civil War or so onward? Does anyone have anecdotal evidence of large melts?
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Will modern commemoratives, first spouse gold coins, and most modern silver proof coins be wiped out? What about common date Morgan/Peace Dollars and double eagles?
I’d imagine that the usual “stuff” is being melted, and anything better is being bought at melt and kept, like usual.
The new phenomenon that didn't happen in 1980 or 2011-12 is that modest condition rarities for both Saints/gold coins and Morgans/silver coins are seeing premiums fade bigtime.
In both the earlier periods, you had a sharp spike and big fall. We've had the spike (silver) and sustained run (gold) -- but it remains to be seen if the proverbial "this time it's different" comes into play. Gold has a major bid -- CBs, SWFs, institutions, plus retail demand in NICs -- and silver supposedly has new sources of industrial demand (we'll see).
The article I posted from The New York Times in 1985 mentioned how many Morgans were saved once silver touched and then faded back from $50. While the destruction of many low- and mid-graded Saints and Morgans might not change the population census and pricing TODAY...who's to say it doesn't impact in 10 or 20 years ? You'd need a big upswing in demand for Type or Registry collecting -- meaning lots more coin collectors -- but who knows, it could happen.
We seen these percentage rises in silver before, but never this large in relative and absolute terms and over a long period of time. Ditto gold. It's a Brave New World and we just have to see how it plays out.
One thing is sure: if silver goes to $100 and eventually $150 an ounce....and gold heads for my target of $7,500 and maybe $10,000 (est. ~2035).....the debate on this Forum will pale in comparision to what is happening today.
The price level and rarity levels are going UP as the price of gold goes UP.
A coin I looked at 3 years ago when gold was $1,700 was $4,500 or about a 160% premium. Today, it's a 33% premium. At $6,000 gold, that premium could be gone and a Gem Mint coin I never thought was common could be at risk of being melted by a dealer or LCS that needs to raise cash quickly or has too much inventory.
I have to believe low grade silver is going to disappear. As of this morning silver is trading at $75 per oz. Half Dollars are now worth over $27 each. That's $540 a roll. Gold is now over $4500 so common worn DE's are worth $4370 melt.
Completed All CAC approved Classic Head $5 set https://www.pcgs.com/setregistry/mysetregistry/album/344241
CBH Set https://www.pcgs.com/setregistry/everyman-collections/everyman-half-dollars/everyman-capped-bust-half-dollars-1807-1839/album/345572
Heritage had an MS-65 1927 Saint up for sale by mid-December.....it is in an OGH 3.1 holder and is CAC.
It sold for $4,560 w/bp ($3,800 without).....gold was about $4,300 that day so only a 5% premium for the CAC bean and an OGH. Wow.....
I realize it's common and MS-65 isn't the level that condition rarity is usually seen but still.....
In January 2024, an identical MS-65 1927 Saint OGH CAC sold for $3,600 (w/BP) when gold was $2,050.....a 75% premium.
No way you are melting that January coin if you needed cash. But the one just sold ? Hmmmm....
It has gotten to a point where I can't see how someone sells common graded gold at auction. The consigner on that coin should have gone to a local dealer. It used to be the case for low grade items but now looks like we are all the way up to 65's.
Completed All CAC approved Classic Head $5 set https://www.pcgs.com/setregistry/mysetregistry/album/344241
CBH Set https://www.pcgs.com/setregistry/everyman-collections/everyman-half-dollars/everyman-capped-bust-half-dollars-1807-1839/album/345572
That's a lot of work; you save a super nice gem Saint, one of the prettiest coin designs, and get the cac sticker, which less than 5% of gems get, then you send it to an auction house, pay a consignment fee and often have to wait months for a check!
A local auction house had a lot of gold and silver coins last week where the consignors were paying 20% for their items to sell at around melt with the buyer premium! Then the wait until the auction company decides the coast is clear to send out a check!
As stated in the post, before BP the coin sold for $3800 when spot was $4300. DE's are around 96%. The auction house would have to give up almost the entire BP to make the seller even compared to an LCS.
Completed All CAC approved Classic Head $5 set https://www.pcgs.com/setregistry/mysetregistry/album/344241
CBH Set https://www.pcgs.com/setregistry/everyman-collections/everyman-half-dollars/everyman-capped-bust-half-dollars-1807-1839/album/345572
Everyone talks about melting coins - Is everyone really melting morgans and peace that often carry a premium for historical and collectible reasons, to get generic Silvertown bars and Santa rounds?
I don’t think so. They just assume others do. But the fact is a bag of Morgans is just as liquid as a bag of Santa rounds or a bar of .999. There is no need to melt them.
And the people talking about melting OGH cac ms65 saints because someone needs to “raise cash fast” are not being serious. What can that melt into that is worth more? A bar?
My LCS said he was looking for a refiner with operations in ITALY (!) to help with his backlog and ability for the LCS to handle their retail demand.
I don't think people on these forums are doing that.....and probably not FT or PT collectors....but the inactive collector or person who made 1 or 2 or 3 purchases in a few decades doesn't care about OGH or CAC or whatever they have....they want CA$$$$$H and want it now.
Melt them into what, bars?
They will be more saleable as numismatic items. At least thats my opinion.
Student of numismatics and collector of Morgan dollars
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Is silver really worth $75 an ounce or are we just witnessing another tulip boom?
If your goal is to hold bullion as some large entities like the Chinese government are doing, then there are massive storage costs. It is easier and takes far less space (and cost) to store a .999 fine bar of gold or silver than bags of .900 fine coins.
I keep thinking about the Pittman Act in 1918 and Morgan dollars and how it created artificial scarcity for some Morgan Dollars.
I do not think dealers or actually anyone will send the early year ASEs to the smelter even though they have no real numismatic value ungraded.
Also BU rolls of common dates (think '64) are hoarded as a store of value even though they have little or no numismatic value.
Yes.
Keeper of the VAM Catalog • Professional Coin Imaging • Prime Number Set • World Coins in Early America • British Trade Dollars • Variety Attribution
I think it has always been that way for generics. Heritage’s buyers’ premium was 17.5% back then (then 20% and now 22%) and potential sellers’ fee of 5%. I’m betting you could have done better selling a generic gem saint to a dealer back then too. What is new is when the OGH, CAC, or other “special feature “ premium is also eroded as someone pointed out earlier in the thread.
Silver simply flows to where it's needed, and always to the highest price.
It's still at the grass roots level.
Would this still be as true if silver is headed to a 16 : 1 ratio to gold?
Needless to say our hosts population reports are going to be even less reliable in the future. Not talking about top pop and near top pop coins, but the higher the price of silver goes, the higher the grade of coins that will " go to pot "
Is the shoeshine man recommending silver?
Hes buying gold with the big boys!
Or he's living out of his car, because the rent is too darned high!
Fear not. He still has the small gold charm, and gold fillings.
This time is different because the refineries are already backed up.
Silver nears $78 up almost $6 today
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Yes, but a coin shop would have a hard time selling a 1,000-oz bar to a customer, compared to selling a few 1964 Kennedys at a time.
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No.
Silver compounds are photo-sensitive. That is why it was used in photographic film.
Copper compounds are not photo-sensitive. This is why silver is important for solar cells and copper is not (except for power transmission wires).
Silver use is increasing at the same time as there are massive buyers everywhere with some of them buying for industry. We have been living hand to mouth in silver by having its price depressed for decades. That failed because of actual physical demand and now the old pricing is failing because of actual physical demand. Backed up refineries have no effect on this equation. Silver sellers don't have enough silver (much of it is US 90%) to affect the equation either and the refineries are backed up so even the silver that isn't enough can't get to market on a timely basis where buyers stretch as far as the eye can see. We are selling into far more demand than all the silver we can sell. When we quit selling and the refineries catch up there is no more silver because all new production is locked up for usage.
Silver is still so cheap that there are still individuals who could purchase virtually all US 90% silver.
There are thousands of buyers with deep pockets and millions of sellers without. But refineries are acting as insulation to sellers. Heats get out at a steady too slow rate.
Replaced with what?
It wouldn't matter if you're right because silver use would just resume its parabolic increases in demand . If solar panels can be done better in copper they should switch and save the silver for more important uses.
The future; Brought to you by silver.
How refined are those processes and how close to being market feasible? If that’s the case, sell all your silver and invest in the other metals.