Archive for ‘Uncategorized’

April 10, 2018

PBS Video: Gold Fever & The Bechtler Mint

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click below for movie:

http://www.pbs.org/video/gold-fever-and-bechtler-mint-gold-fever-and-bechtler-mint/

During the Colonial Era gold in North Carolina was only found in trace amounts.  It wasn’t until the year 1799 that substantial success was achieved, by accident, in Cabarrus County.  The first substantial piece was found by twelve year old Conrad Reed who was fishing in Meadow Creek with his brother and sister.  He withdrew from the small stream a shiny yellow substance that he assumed to be some type of metal.  He brought the nugget home to his father, John Reed, who upon examination declared it as an unknown metal and put it to use as a door stop for two years.  In 1802 he took the nugget to a jeweler in town who immediately recognized the “metal” and its value.  The jeweler converted the nugget into a gold bar measuring roughly 8 inches long and asked Mr. Reed if he would sell it.  Mr. Reed, not knowing the value of the gold bar, sold it to the jeweler for $3.50.  In time Mr. Reed found several pieces of gold along the creek bed and in 1803 he found a piece weighing in at twenty-eight pounds.  The creek was rich in gold and in the year 1831 the veins of the mine were discovered.  In 1848 a sketch of the mine was made by a miner, Colonel George Barnhardt, and he declared the Reed Gold Mine to be the first in the United States.

Meanwhile in 1825 several mines were opened within a twenty mile radius of Charlotte. Two of the more significant mines were the Rudisill Mine of Count Ravafanoli, which brought experienced miners from Italy and other parts of Europe and the St. Catherine Mine opened by Samual McComb. These two mines were the most profitable with assays ranging from $24.80 to $72.41 per ton. Being rich in ore, the Rudisill mine was still in operation by the end of the Civil War.

It soon became essential that the miners have a local facility for processing the substantial quantities of gold flowing through North Carolina. Unfortunately the U.S. Mint was opposed to the idea and it was several years before a branch mint was established; this delay provided and excellent opportunity for private minters.

In 1829 German born Christopher Bechtler, Sr., arrived in New York City with his son August and his nephew, Christopher. A year later they bought a tract of land in Rutherford County establishing themselves in the local community as jewelers and watchmakers. In 1831 the miners’ plight brought enough business to the Bechtler’s that it resulted in a private mint and assay office. The Bechtler mint cast dies for $1.00, $2.50 and $5.00 pieces. The coins were noted for being 20 carats fine, or 2 carats below the US standard. Bechtler coinage of 1831 bore the words “South Carolina” and “gold”. Coins appearing later than 1834 bore the words “North Carolina Gold”, “Carolina Gold”, and “Georgia Gold”. Bechtler soon had a reputation as a “man of competent science and skill to assay and bring the gold of the mines to a standard value, in the form of coin…he is a man of the strictest honesty and singleness of purpose.” His popularity and reputation allowed for almost ten years of coinage.

Bechtler, Sr. operated the mint until his death in 1842 and was succeeded by his son August who was later succeeded by his nephew Christopher. Unfortunately neither August or Christopher had the pristine reputation of Sr., as their coins were often underweight or of dubious fineness.

Bechtler gold coins were minted eighteen years before the first striking at Philadelphia in 1849 and were so well accepted for commerce that they became a standard for currency. During the Civil War the monetary obligations of the Confederacy were specified as payable in “Bechtler gold” rather than Union, Confederate, or State currency.

Today, Bechtler coins are rare and command high prices, especially those minted prior to the Coinage Act of 1834 which increased the value of gold by more than six percent which resulting in a massive melting of gold coins, Bechtler’s included.

 

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April 10, 2018

Saint-Gaudens coin collection designed in Cornish, NH could fetch more than $7m at auction

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CORNISH, NH — A complete set of historic U.S. Double Eagle $20 gold coins designed by famed sculptor and Cornish resident Augustus Saint-Gaudens minted between 1907 and 1932 are currently up for auction online and expected to fetch “north of $7 million,” said coin dealer Barry Stuppler.

Stuppler’s California-based firm Mint State Gold by Stuppler and Co. is representing the collection owner in the auction that began Thursday on e-Bay, he said Tuesday.

The collection owner spent 15 years bringing the collection together so that each coin in the collection is of the highest quality in terms of its condition.

In all his years in numismatics — the study or collection of currency — “I’ve never seen a set like this come on the market,” Stuppler said.

He said the auction is expected to end Sunday and already has 53 bidders and a high bid of $2.1 million, though he predicts that by Sunday the bids will reach “north of $7 million.”

“A number of these people are numismatists, many of them are not. Many of them are just looking for an interesting collection with investment potential,” Stuppler said.

One of the reasons these coins are so rare is that President Franklin Delano Roosevelt ended the production of all gold coins in the United States because of the Great Depression, ordering the collection of the coins by the banks so they could be melted down.

“That’s how we got Fort Knox,” Stuppler said.

The ban on gold coins in the U.S. continued well into the 1960s, he added. “American citizens in the U.S. weren’t able to own gold coins until 1968.”

Before that, $5, $10 and $20 gold coins were used interchangeably with paper currency, Stuppler said.

One of America’s foremost sculptors, Saint-Gaudens was living and working in Cornish when he designed the coin in 1907, the last year of his life, said Henry Duffy, curator of the Saint-Gaudens National Historic Site in Cornish.

“He was designing it in the last year of his life. He had started, of course, earlier than that, but he was working on it at the time of his death,” Duffy said. “He had done small works when he had started off when he was a child designing, making jewelry, making cameos, so he was familiar working in small scale and he had also done medals. So he did know about small objects, but designing coins was something new and that was the idea of President Roosevelt, who wanted to redesign American coins, and he was familiar with Saint-Gaudens’ work. Saint-Gaudens had made an inaugural medal for him when he became President.”

Now a museum and National Park, the former home, gardens and studios of Saint-Gaudens is home to more than 100 pieces of art made by the sculptor as well as a complete set of the Double Eagle coins, Duffy said.

Stuppler said people interested in learning more about the set and how to make a bid can find out online at http://www.saintsets.com.

February 14, 2018

Inflation Heats Up, Stocks Tumble

https://finance.yahoo.com/news/inflation-heats-stocks-tumble-134723028.html

Consumer prices rose more than expected in January, sending Treasury yields higher and stock futures lower on Wednesday morning.

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In January, consumer prices rose 0.5% over the prior month and 0.3% over last month on a “core” basis, which excludes the more volatile costs of food and gas, according to the latest numbers from the Bureau of Labor Statistics. Wall Street was looking for a 0.3% and 0.2% increase in these figures, respectively.

Compared to last year, the core consumer price index (CPI) was up 1.8%, more than the 1.7% increase that was expected by economists.

Markets on Wednesday were taking this as a sign that inflation pressures may indeed be perking up in the economy, re-kindling market worries that surfaced earlier this month about an overheating economy. Fears over inflation pressures, and in turn more aggressive interest rate hikes from the Federal Reserve, was seen as the initial impetus for the stock market sell-off that roiled markets last week.

Following Wednesday’s inflation data, stock futures were sharply lower with Dow futures down as many as 330 points, or 1.3%, with S&P 500 and Nasdaq futures also down more than 1.2%.

Treasury yields were also higher, with the 10-year hitting 2.87% and the 2-year hitting 2.14% as bond markets anticipate potentially more aggressive action on interest rate hikes from the Federal Reserve this year. As of December, the Fed expected it will raise interest rates three times this year.

Including all items, CPI rose 2.1% over the prior year in January, more than the 1.9% that was expected by economists. Markets more closely track the “core” numbers as the Federal Reserve prefers to strip out the more volatile costs of food and gas.

Torsten Sløk, chief international economist at Deutsche Bank, noted in an email on Tuesday that economists surveyed by Bloomberg expect core inflation to average 1.8% in the second quarter of the year, up from 1.5% in the first quarter. Wednesday’s report will likely pull forward expectations for faster inflation even more.

“I currently spend significant amounts of time on the phone, emails, and in meetings explaining this coming jump in the March and April inflation data,” Sløk said. “And I have come to the conclusion that this is not priced in to rates at all.”

Wednesday’s post-report reaction shows the market re-pricing these expectations. Quickly.

February 14, 2018

Not Chump Change: Rare Coins Could Outperform as Investments This Year

https://www.marketwatch.com/story/not-chump-change-rare-coins-could-outperform-as-investments-this-year-2017-01-31

Coin collecting isn’t just for nerds anymore.

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Coins typically have a higher correlation with inflation than other asset classes.

With inflation expected to rise this year, and a concurrently strengthening U.S. dollar seen eating into any gains that might be made by pure gold, investors may want to consider a niche asset class as a protection against market turbulence: rare coins.

With inflation expected to rise this year, and a concurrently strengthening U.S. dollar seen eating into any gains that might be made by pure gold, investors may want to consider a niche asset class as a protection against market turbulence: rare coins.

While such a strategy may seem akin to putting your money in baseball cards, coins have long been used as an investment, and one that could be particularly beneficial in the current economic climate.

“Rare coins deliver a higher annual return than gold, and they provide an excellent hedge against inflation,” said David Beahm, chief executive officer of Blanchard and Company, a rare coin and precious metal investment firm. “We believe that with President Trump and some of the policies he’s set forth, that we should see inflation, possibly double-digit inflation, in the very near future.”
Trump has proposed massive corporate tax cuts and fiscal stimulus, both of which are expected to stoke inflation this year. That could increase the appeal of gold, which has traditionally been viewed as an inflation hedge.

Investable coins are defined as ones minted between the late 1700s and 1933, when gold ceased to be an ingredient in their construction. Prices are determined both by their scarcity and their condition, and they’re scored on a scale of zero to 70, with Blanchard focusing on the ones graded above 50.

Between 1979 and 2014, the most recent year for which data is available, coins with a minimum score of 65 posted an average annual return of 11.9%, according to a study by Penn State University. That’s near the average annual return of 13% posted by equities SPX, -0.22% and more than twice the 5.5% average annual gain of gold bullion US:GCZ7 Coins with a lower score, between 63 and 65, had an average annual return of 10.1%.

Coins posted a higher correlation with inflation than other asset classes, according to the study, with the relationship about twice as strong as for gold. The correlation between coins and inflation is 0.58 (perfect correlation would be 1.0). It’s 0.27 for gold bullion and 0.15 for stocks. The higher the correlation, the better it works as a hedge.

“The rarity factor builds on the actual value of the gold, increasing its value,” Beahm said.

He added that the more common rare coins, such as Morgan dollars, could be had for as little as $20, while the scarcest ones, including Brasher Doubloons, the first gold coin minted for the U.S., have sold for more than $7 million.

“There’s a wide range, so this is really for everyone,” he said.

February 13, 2018

Buyers of Coin Bargains Active in Marketplace

http://www.numismaticnews.net/article/buyers-coin-bargains-active-marketplace

 

Bargain hunting may be the watchword within the scarce to rare segment of the coin market. There are indications a significant number of collectors and perhaps speculators who know what they are doing are purchasing better date and superior condition coins at today’s somewhat depressed price levels.

These buyers do not appear to be willing to pay premiums above current pricing, but they aren’t dragging prices lower, either. Since current price levels are significantly lower than they have been in the not-too-distant-past, this may inadvertently signal a future rally in this important segment of what I will call the “collector coin” market.

The spot price of gold and silver bullion continues to take center stage in the overall business of coins. Currently, the value of the majority of the coins being traded in the business are being impacted by the intrinsic value of what is bought and sold.

The modest appreciation in gold has been a catalyst for the First Spouse coins, with likewise modest price increases, and with sales nearly doubling from one month earlier.

Gold and silver bullion did increase modestly in price when the stock market recently sold off but did not make sufficient gains to grab much attention from potential investors.

Bottom line this week is that the market for coins is healthy, but it is still far from earning a label indicating it is robust.

December 28, 2017

Chance of US Stock Market Correction Now at 70 Percent: Vanguard Group

https://www.cnbc.com/2017/11/27/chance-of-us-stock-market-correction-now-at-70-percent-vanguard.html

There is a 70 percent chance of a US stock market correction, according to research conducted by fund giant Vanguard Group.
Several forces are contributing to the much higher than typical risk, including narrowing of the bond yield curve and stretched U.S. equity valuations.
The trade-off between stocks and bonds, or even stocks and cash, doesn’t look as strong as it did earlier in the bull market, following the financial crash.

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Don’t panic, but there is now a 70 percent chance of a U.S. stock market correction, according to research conducted by fund giant Vanguard Group. There is always the risk of a correction in stocks, but the Vanguard research shows that the current probability is 30 percent higher than what has been typical over the past six decades.

Vanguard, which manages roughly $5 trillion in assets and is a proponent of long-term investing, isn’t sounding the alarm bells to scare investors out of the market. But according to Vanguard’s chief economist Joe Davis, investors do need to be prepared for a significant downturn.

“It’s about having reasonable expectations,” Davis said of the research, which attempts to provide investors with a view of what can occur in the markets in the next five years. “Having a 10 percent negative return in the U.S. market in a calendar year [within a five-year forward period] has happened 40 percent of the time since 1960. That goes with the territory of being a stock investor.” He added, “It’s unreasonable to expect rates of returns, which exceeded our own bullish forecast from 2010, to continue.”

In its annual economic and investing outlook published last week, Vanguard told investors to expect no better than 4 percent to 6 percent returns from stocks in the next five years, its least bullish outlook since the post-financial crisis recovery began.

Contributing to that outlook are market indicators that suggest “a little froth” in the market, according to the Vanguard chief economist.

“The risk premium, whether corporate bond spreads or the shape of yield curve, or earnings yields for stocks, have continued to compress,” Davis said. “We’re starting to see, for first time … some measures of expected risk premiums compressed below areas where we think it can be associated with fair value.”

Many market participants have worried in recent months about the flattening in the yield curve — the spread between 2-year note yields and 10-year yields — at the lowest level since before the financial crisis. Meanwhile, the spread between junk bond yields and Treasurys recently has moved closer to the level before the financial crash than the long-term historical average.

For Vanguard the research is a chance to remind investors that overreaching is no better a solution for a lower-return environment than getting out of the market entirely. Davis worries some investors will hear “lower returns” and view it as a catalyst to become more aggressive as a way to generate the returns they have been used to in recent years.

As long as an investor is in a financial situation in which they can cope with a single down year, “you need to stay invested, because of lower expected returns,” Davis said. But he added, “Don’t become overly aggressive. The next five years will be challenging, and investors need to have their eyes wide open.”

For investors who have done well with a U.S.-centric stock portfolio, it’s also past time to consider overseas equities. When international equities are added into a stock portfolio, the Vanguard research shows a drop to a 60 percent correction risk for a stock portfolio.

“It doesn’t drive risk down to zero, but valuations are not neatly as stretched in other parts of the world,” Davis said. Emerging markets stocks, which have roared in 2017, are highly correlated to U.S. stocks, and the Vanguard official said that would hold if U.S. stocks experience a downturn. “The real power is other developed markets,” Davis said.

As part of its forecast that stocks will return no better than 4 percent to 6 percent in the coming years, Vanguard projected that developed markets stocks in the EAFE region will return more than U.S. stocks, at an estimated 5 percent to 7 percent, and emerging markets stocks possibly more, though with greater risk.

The Vanguard research also suggests that an allocation to bonds may prove more important in the coming years. “There is greater risk in the equity market than bond market,” Davis said. “Our projections show that the downside risk in a portfolio with even a 20 percent investment-grade bond allocation is significantly lower.”

Other major financial services firms are more cautious headed into 2018 as well, pointing to the length of the current bull market. Bank of America wrote in a recent note that the current bull market will be the longest in history if it continues to Aug. 22, 2018, while the outperformance of stocks vs. bonds, at seven years running, would be the longest streak since 1929.

Now in the ninth year of an economic recovery, Vanguard’s chief economist said the position of the investor has flipped. Back in 2009 the economic outlook was poor but the investment outlook was very compelling. The progression through the economic recovery, although slow, now includes 80 percent of the world at full employment and an investment environment and outlook that is more muted.

“It’s important to separate what is expected of the global economy from the price being paid for it. In the United States, stock prices have already been bid up based on future business expansion,” Davis said.

Vanguard’s economics team reviewed multiple stock valuation measures in coming to its conclusions, including Yale University professor Robert Shiller’s CAPE ratio. “As markets rise and valuation on the Shiller has risen … [it] doesn’t mean we’re in bubble territory, but we have deviated from where values should be,” Davis said. Historically, low interest rates on bonds help explain why stock valuations have overshot corporate fundamental growth, but still can’t justify the valuation levels.

Vanguard’s bottom line is that the trade-off — the equity risk premium — between stocks and bonds, or even stocks and cash, will be lower going forward than it has been historically, and lower than what it has been in the past five years, specifically.

November 28, 2017

Take Advantage of Generally Weak Prices

http://www.numismaticnews.net/article/take-advantage-generally-weak-prices

If you follow the value of excessively rare coins sold at auction, you are likely to be impressed with recent prices realized. If you collect anything else, that being coins ranging from between common but collectible to scarce or to rare, you’ll realize there are truly few coins that have been recently increasing in price.

Astute collectors are buying such bargains as common date proof silver American Eagles. Only a few months ago, they sold for significantly higher prices.

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Generic gold quarter eagles, half eagles, eagles and double eagles are attractive at today’s prices, the only exception being very high Mint State graded examples.

Even among coins certified to be in unusually high condition by reliable third-party certification services, prices are mostly flat lined or down.

This is no time to ring the alarm bells. It is a time for a feeding frenzy! It’s been a long time since many scarcer and more desirable coins have been selling at current price levels.

Prices of many collectible yet common to scarce gold coins barely change between grades except for the very loftiest examples. Morgan and Peace silver dollars remain popular, but the price of most of these continues to remain flat.

There are some exceptions to these general conditions. Very specialized areas such as large cents and Capped Bust half dollars are showing an inherent strength, but even in these two areas there are bargains to be had.

It is a buyer’s market. We don’t know how long it will last. Act before it is too late.

November 9, 2017

MORGAN STANLEY: A Stock Market Correction is ‘Looking More Likely’

http://www.businessinsider.com/stock-market-news-correction-looking-more-likely-morgan-stanley-2017-10

Morgan Stanley warns that a near-term pullback in the S&P 500 could be coming.

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Earnings season can be a euphoric time for stocks.

It’s a time when companies have the opportunity to show off growth that matches their valuations, and it can encourage investment by traders looking to put money to work.

But that may not be the case this time around, Morgan Stanley warns.

A big part of that has to do with how investors approach earnings season. When investors anticipate strong results, stocks tend to rally heading into the season only to fade as results are actually reported, the firm says.

This scenario has played out in a relatively benign way twice already this year, with the maximum loss reaching just 3%. But it’s different this time around, with the benchmark S&P 500 holding roughly just half of its previous upside, according to Morgan Stanley forecasts.

“If stocks follow the pattern they have been all year, actual earnings season will be a sell the news event and we could have a decent pull back or consolidation,” a group of equity strategists led by Michael J. Wilson wrote in a client note. “Near term, a correction is looking more likely.”

So what could cause this decline, which the firm says could stretch further than 5%? Wilson & Co. lay out five possible negative catalysts:

-The unwinding of the Federal Reserve’s massive balance sheet

-Tax-cut legislation proves to be more difficult than simply making promises

-The announcement of a new Fed chief could “disrupt financial conditions”

-The US dollar, fresh off multiyear lows, looks to be reversing to the upside

-Leading economic indicators are hitting extremes, suggesting peaks are “more likely than not”

With all that said, Morgan Stanley is far from calling the end of the 8-1/2-year bull market. The firm is simply warning about the possibility of a relatively mild pullback from what have been record-high valuations.

In fact, the firm is the most bullish on Wall Street, with a 2,700 target on the S&P 500 by the end of first quarter 2018. That’s 5.6% above the index’s closing price on Monday.

As such, Wilson recommends that investors use whatever weakness results from a potential correction as an opportunity to load back up on equity exposure. In other words, buy the dip — the unofficial slogan of the unstoppable bull market.

November 9, 2017

Price Guide Values Left in the Dust by Quarter Eagle in GreatCollections Auction

https://www.coinworld.com/news/us-coins/2017/11/greatcollections-selling-some-great-collections.html#

1865-S Coronet gold $2.50 quarter eagle realizes $36,001 in Oct. 29 sale.

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An 1865-S Coronet gold $2.50 quarter eagle sold during an Oct. 29 GreatCollections online auction for more than double its value listed in published price guides.

Graded and encapsulated Mint State 63 by Professional Coin Grading Service and stickered with a green label by Certified Acceptance Corp. as being exceptional for the grade, the coin realized $36,001.14, which includes the 10 percent buyer’s fee. Twelve active bidders placed 49 bids.

Russell said the underbidder, who was outbid by $1,000.01, had anticipated winning with his $31,001 bid to start a box of 20 of coins “that have everything going for it — finest PCGS/CAC, super fresh (never appeared on the market before) and so forth.”

The coin was one of two PCGS submissions recorded in MS-63, with one submission higher at MS-64.

Coin World’s Coin Values lists a price of $13,000 in MS-62, but lists no value for the coin in MS-63. The PCGS Price Guide values the coin at $15,000 in MS-63.

“The coin was one of many highlights from a collection in California that is being sold by GreatCollections,” Russell said. “The coins were graded for the first time this year by PCGS. There are still amazing coins that have never seen the light of day coming onto the market, it’s what makes our job so enjoyable to see newly discovered coins like this and seeing the vast bidder interest”.

Another gold coin highlight from the Oct. 29 sale was an 1861-D Indian Head dollar graded Fine 12, the lowest grade for any gold dollar struck at the Dahlonega Mint in Georgia in 1861.

Coin Values lists a price of $13,500 in Fine 12. The coin realized $26,437.50.

A total of 12 bidders placed 44 bids combined for the gold coin.

November 9, 2017

Take Advantage of Lower Prices by Buying.

 http://www.numismaticnews.net/article/take-advantage-lower-prices-buying

Inflation is a concern for everyone, but what about deflation? Deflation is what the entire collectibles industry, be it coins or other collectibles, has been experiencing for several years. What we in coin collecting have bee is a dip in the spot price of gold or silver.

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This relentless price decline has impacted almost all coins, not just the more common collectibles. Scarce to rare coins have not performed well in some time.

As the price of both gold and silver continue to slump, it becomes increasingly difficult for those of us who are active collectors or commodity investors to understand why more people aren’t realizing just how cheap both bullion and coins have become.

This low price is becoming a boon to active collectors, some of whom are increasingly taking advantage of the depressed price of better date or better condition coins. There aren’t sufficient collectors chasing these coins for the demand to outstrip supply – at the moment. At some point, people need to take stock and bond profits off the table, going after coins and other collectibles with their financial gains.

In the meantime, if you are an active collector, enjoy what’s available. You can shop around. You can be picky. But then make a decision and buy what you have hankered after. The only way you can benefit from lower prices is to make additions to your collection.