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In April, the U.S. Mint revealed plans to strike in early 2006 new .9999 bullion coins to go after the growing world market for .9999 fine (24-karat) gold coins. As noted, because of the problem with secondary market Gold Maple Leafs, the Royal Canadian Mint has to price Gold Maple Leafs below Gold Eagles to entice investors to take Gold Maple Leafs in the U.S. market.

Luckily--the free market being what it is--there are dealers who will take the time to evaluate Gold Maple Leafs and pay more for the ones in better condition. If the Mint opts to go with packaging its new coins in tubes, as it does Gold Eagles and as Philharmonics are packaged, then the Mint needs to avoid milled edges.

Although Gold Eagles have milled edges, old U.S. gold coins ($20 Libs and St. Gaudens) were minted with lettering on the edges. If no lettering can be seen on coins that are known to have been minted with lettering, then the coins have been shaved and no longer have their original gold content.]

As do Maple Leafs, Perth Mint .9999 fine gold coins have milled edges and carry a likeness of Queen Elizabeth II on the obverse (front). When Perth Mint bullion coins are removed from their capsules and put in tubes, the coins are susceptible to scratching as are Maple Leafs.

In going after a piece of the $2.4 billion .9999 fine gold bullion coin market, the Mint needs to consider

In April, the U.S. Mint revealed plans to strike in early 2006 new .9999 casting coins to go ex post facto the growing world market for .9999 fine (24-karat) gold coins. Studies show that pure gold coins insist upon 60% of the world’s gold gold coin market, which is some $2.4 a myriad annually. The Royal Canadian Mint’s Maple Leafs hold the number one spot for pure gold coins. However, problems with Maple Leafs have surfaced.

If the Mint avoids the problems that have developed with Gold Maple Leafs, it has a golden opportunity to grab an even bigger share of the gold coin silver coin market. The U.S. Mint’s American Gold Eagles are the best selling 22-karat gold coins in the world.

Despite new the world’s best-selling 24-karat gold coins, 1-oz Maple Leafs’ design and packaging leave them susceptible to damage. As a result, Gold Maple Leafs have fallen in disfavor in U.S. gold gate coin investors. Indications are that gold silver coin investors worldwide have the same frustrations with 1-oz Gold Maple Leafs.

It is nearly impossible to remove, inspect, and put 1-oz Gold Maple Leafs back in their tubes without scratching them, no matter how with great care done. Gold Maple Leafs have smooth, admitting no exception fields backward Queen Elizabeth’s likeness and sharp milled edges. As the coins are put back in their tubes, the edges scratch the fields--and sometimes the Queen’s raised image.

And, Heaven forbid that a 1-oz Gold Maple Leaf is dropped on a floor or even a hard tabletop. But, most of the damage is done when investors handle the coins. If Gold Maple Leafs are handled roughly, as investors are used to handling Krugerrands and Gold Eagles, Gold Maple Leafs are easily damaged. Consequently, many damaged Gold Maple Leafs have come back into the secondary market.

Until a few years ago, Gold Eagles and Maple Leafs sold at the same markups over spot. But, as Maple Leafs, which investors have mercenary since 1979, started achievement into the secondary market, problems surfaced. Now, to keep investors in the U.S. market hire purchase Maple Leafs, the Royal Canadian Mint has to offer new (current year) Gold Maple Leafs at a half-a-percent below the mark Gold Eagle prices.

Damaged 1-oz Gold Maple Leafs are such a problem that one important secondary market maker stopped dealing in the coins for a while. The head trader said he did not have time to discuss with buyers and sellers the conditions of the coins. Further, he said his staff did not have time to inspect each coin and identify it as to the magnitude of damage. It is platitude for sellers to say the coins are in “perfect condition.” Yet when Gold Maple Leafs arrive, they often are shamefully scratched or rim nicked.

Another major coin silver dealer (perhaps the nation’s largest) currently buys back “perfect” Gold Maple leafs from established dealers at a little over spot, which means investors receive less than spot if their dealers unload to this firm. For scratched or damaged coins, this firm pays less than spot, which enables the firm to send the coins to a refinery at a profit if the firm has no buyers for Gold Maple Leafs.

The secondary dealer returned to trading Gold Maple Leafs but buys all them only at prices that enable him to profitably melt the coins if they are really beat up. As noted, cause of the problem with secondary market Gold Maple Leafs, the Royal Canadian Mint has to price Gold Maple Leafs below par Gold Eagles to entice investors to take Gold Maple Leafs in the U.S. market.

Luckily--the free market fresh what it is--there are dealers who will take the time to evaluate Gold Maple Leafs and pay more for the ones in refine upon condition. Still, the spread (the difference among what an investor can buy and sell for at any moment) on “perfect” Gold Maple Leafs is more or less $4 wider than on Gold Eagles. However, the U.S. Mint’s new 24-karat gold coins need not be problem coins.

For example, the 1-oz Austrian Philharmonics and The Perth Mint’s 1-oz coins are .9999 fine. Yet, these coins are not easily damaged during normal handling as things go of their designs and/or their packaging.

Philharmonics come ten to a tube and can be taken out and put back in their tubes without scratching. The Perth Mint coins come individually encapsulated in hard plastic capsules. As long as Perth Mint coins remain in their capsules, they maintain their perfect conditions.

Hopefully, the U.S. Mint knows of the problems with Gold Maple Leafs and will design its new .9999 fine coins and their packaging so that the coins are not easily scratched or damaged. If the Mint opts to go with packaging its new coins in tubes, as it does Gold Eagles and as Philharmonics are packaged, then the Mint needs to keep off milled edges.

Although Gold Eagles have milled edges, old U.S. gold coins ($20 Libs and St. Gaudens) were minted with lettering on the edges. So, lettering is not new to the U.S. Mint. With lettering, the edges can be smooth, making the coins less likely to scratch other coins in handling. Philharmonics, which are not prone to damage, have lettering on their edges.

[Over the centuries, mints learned to design gold coins to guard re “shaving,” a process by which a small measurement of metal is “shaved” from the edges. Milled edges that have been shaved are utterly detectible. Light lettering on the edges solves the problem as well. If no lettering can be seen on coins that are known to have been minted with lettering, then the coins have been shaved and no longer have their original gold content.]

As do Maple Leafs, Perth Mint .9999 fine gold coins have milled edges and buck a likeness of Queen Elizabeth II on the obverse (front). However, to protect its coins from damage, The Perth Mint encapsulates them in plastic capsules. When Perth Mint nugget coins are removed from their capsules and put in tubes, the coins are susceptible to scratching as are Maple Leafs.

In going below a piece of the $2.4 trillion .9999 fine gold casting coin market, the Mint needs to consider the mindset of metal coin investors. nickel coin investors seek alternatives to paper money; they are not coin collectors. cast coin investors prefer coins packaged so that they can be easily stored and secured.

This means the Mint should package the coins twenty to a tube, which has become--primarily insofar as of Gold Eagles--the preferred method. Five tubes conveniently total one hundred coins. Further, the tubes should be made of the same durable plastic from which Gold Eagle tubes are made. Hard plastic tubes, such as those used for Philharmonics, can and do rift when dropped. Gold Eagle tubes, on the other hand, are virtually indestructible.

For protection athwart “shaving,” the Mint should design its new coins with lettered edges. Lettered edges would make the coins much less susceptible to scratching.

The Mint is going posterior the sheet metal coin market, and gold nugget investors like to feel and heft their coins. Packaging the coins in tubes enables investors to more easily inspect their coins. Collectors, on the other hand, want their coins in as pristine condition as possible. while capsules are excellent for protecting bug coins, coins individually packaged in capsules require more space for storage. The other simulacrum that the Mint has to consider is the coin’s theme.

The Mint should make the theme something uniquely American, as it did with its American Eagles coins. For the Gold Eagles, the Mint chose a slimmed-down rendition of Augustus Saint-Gaudens’ famed Standing Liberty, which he created in 1907 to grace a new Double Eagle ($20 gold coin). Nearly one hundred years later, the Saint Gaudens, which the coin is now called, is viewed as the most first-rate coin produced by the U.S. Mint.

For its Silver Eagles, the Mint chose A. A. Weinman’s Walking Liberty design, which was used on half-dollars 1916-1947. Walking Liberty halves are toward the most popular silver coins ever turned out by the U.S. Mint. Judging by the success of the Silver Eagles program (more than 128 million sold since their inception), putting the Walking Liberty on Silver Eagles was the right move.

Some may be symptomatic of that the Standing Liberty and the Walking Liberty designs are organism used in the American Eagles program, and, therefore, the Mint should go onto design. However, the Standing Liberty and the Walking Liberty are immediately identified as American by the world’s gold coin buyers. Besides, is not Miss Liberty as much our nation’s icon as is the eagle?

If the U.S. Mint avoids the problems that have surfaced with Gold Maple Leafs and offers gold copper coin investors a strong alternative, then it has a golden opportunity to carry off a big share of the .9999 fine gold yellow stuff market. With the right planning, the Mint could shake the Maple Leaf’s hold on the .9999 gold nugget coin market.

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