$1,000 Gold Positive But Variable
By David C. Harper
jumped over the $1,000 mark Sept. 11, Kirk Kelly
of the Coin Depot, Greenville, S.C., says his
sales of the precious metal have increased
"Our sales are up probably 50 percent," he told
Numismatic News Sept. 23.
"We've certainly seen an increase in the
American Eagles and any of the bullion stuff."
He ticked off the Canadian Maple Leaf coins and
the South African Krugerrands, too.
Kelly has noticed the decline in the premiums
over bullion value in recent weeks as compared
to last year and the early months of 2009.
"They are a fair amount cheaper," he said of the
gold coin premiums.
With silver trading over $17 a troy ounce, he
said there is an "increase in silver purchases,
People were buying "just about every which way
you can buy.
"We're selling a bunch of 100-ounce bars. We've
sold out of 10-ounce bars."
He noted he was also selling 5-ounce and 1-ounce
Demand for $1,000 face value bags of 90 percent
silver U.S. coins was also higher, he said.
One reason perhaps is premiums on the bags are
"Oh yeah, 90 percent, it's a cheap premium now.
It's just a little over melt," Kelly observed.
How about people selling precious metals back to
him at the current high prices?
"We've seen an uptick in that. It hasn't been as
dramatic as our sales," Kelly said.
Where will gold be in the future?
"Well over the next week or two it could go
almost anywhere. The IMF is thinking about
selling off some of their gold. There are a lot
of little things in the market that could affect
Kelly was more comfortable talking about the
more distant future.
"Six months or a year out it will be higher," he
Glenn Malone of Glenn's Coin Shop in Downey,
Calif., said his view at street level is the
opposite of Kelly's experience.
"Now everybody is on the waiting deal hoping it
will go back down. Now they are on the fence,"
In his shop he does not do that much in gold
sales. He explained that margins for him work
out to $10-$20 on a $1,000 coin.
"It's really not a lot of fun messing with it,"
However, meat and potato collector coin sales
are doing well, he pointed out.
"There are just an awful lot of people buying
coins," he explained.
Why might that be?
People are "not making a lot of money in the
As an alternative to getting almost no interest,
Malone said collectors are "filling in
collections with better coins and upgrading."
He cited an example of a customer who saw his ad
in Numismatic News. He visited the shop and
bought $1,000 in BU quarters.
"He liked the grades and took them," Malone
Gold may have jumped, but business at American
Precious Metals Exchange in Edmund, Okla., has
"I wouldn't necessarily say there's been a jump.
It's been steady," said Scott Thomas of APMX.
"Some say it is time to sell, but there are
equal amounts of people buying," he said. "There
are plenty of both."
In addition to the popular bullion coins, Thomas
said the pre-1933 gold is selling "very well."
The year 1933 saw the end of regular American
gold coinage as the United States left the gold
Thomas also concurred with the view that demand
for 90 percent silver bags is strong.
"We're selling a lot of bags of 90," Thomas
said. "The silver American Eagles are always
good sellers. We sell a ton of those."
When asked if he wanted to make a forecast about
gold's future price, Thomas replied, "No, I
don't think so.
"To be honest with you, we've been at this
number before. I think this stimulus plan has
helped to settle everything down. The run now is
due to inflation fears. If the fear of inflation
goes away, gold will go back down."
If inflation fears prove true, Thomas forecast
that gold "could easily go up."
Gold over $1,000 obviously has gotten the
attention of many people. What they do in light
of this new price level seems not effectively to
have become a pattern.