Rising gold prices pose threat to numismatists and US mint

The recent rise in the prices of gold and silver (or more to the point, the drop in the value of the US dollar and the concordant economic problems in the US) have posed significant chanllenges to the US Mint - production of UNC / bullion coins is at an all time high, so much so that the US Mint recently decided that they'd suspend production of proof silver and gold coinage for 2009 at least, so that they could devote as much of their resources as possible to the production of proof coins.

This latest news has caused a rather strong reaction within the US numismatic community (one headline reads "US Mint angers Collectors and Dealers", which may cause some to say - build a bridge! (ie get over it).

Such a callous and uninformed response doesn't really take into account the impac that a decision such as this can have on the dedicated collector, many of whom (according to the learned people that study the reasons why people collect) build collections of coins in order to make sense of the broader world around them, and to experience some sense or order and control in their life, albeit only in a small area. When that refuge of their hours spent building and enjoying their collection is taken away from them, many collectors react strongly, with exactly the same emotion we see in this story.

Could we see a similar situation here in Australia? I doubt it - the US Government has mandated that the US Mint must produce as much gold and silver bullion coins as the public wishes to buy, and I'm not sure that similar legislation exists here in Australia (although I haven't studied it so I may be quite incorrect). There have been delays (some would say extended delays) in the delivery of bullion coins by the Perth Mint, but their ever popular line of proof coins struck for collectors goes from strength to strength.

We have seen some bewilderment and dismay within the collector community at the apparent cessation of production of proof silver Kookaburra coins by the Perth Mint (back in 2006?), however that happened for reasons completely unrelated to demands on their production line. I believe the extensive Discover Australia series of proofs has effectively replaced the Kookaburra series for the time being, which is why they ain't seen in the McDonald and Rennik's catalogues since then. Mint staff that deal with collectors here in Australia will surely attest to the reaction that sections of their client base have to seemingly minor changes to packaging, designs or any other aspect of the coins that they collect. We all do love an island in the sea of chaos that is life in the 21st century!


Category: Market News