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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 coins to go proper to the growing world market for .9999 fine (24-karat) gold coins. Studies show that pure gold coins fill 60% of the world’s gold gold nugget coin market, which is some $2.4 zillion 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 button coin market. The U.S. Mint’s American Gold Eagles are the best selling 22-karat gold coins in the world.

Despite microbe 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 casting coin investors. Indications are that gold pig 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 diligently done. Gold Maple Leafs have smooth, fine fields existent 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 incorrectly 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 since 1979, started into the secondary market, problems surfaced. Now, to keep investors in the U.S. market Maple Leafs, the Royal Canadian Mint has to offer new (current year) Gold Maple Leafs at a half-a-percent below deck 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 divide it as to the score of damage. It is chestnut for sellers to say the coins are in “perfect condition.” Yet when Gold Maple Leafs arrive, they often are wickedly scratched or rim nicked.

Another major gate 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, in that of the problem with secondary market Gold Maple Leafs, the Royal Canadian Mint has to price Gold Maple Leafs below deck Gold Eagles to entice investors to take Gold Maple Leafs in the U.S. market.

Luckily--the free market guy what it is--there are dealers who will take the time to evaluate Gold Maple Leafs and pay more for the ones in accommodate condition. Still, the spread (the difference mid what an investor can buy and sell for at any moment) on “perfect” Gold Maple Leafs is as regards $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 being as how 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 divert 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 at cross-purposes with “shaving,” a process by which a small add up to of metal is “shaved” from the edges. Milled edges that have been shaved are lucidly 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 inspire 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 yellow stuff coins are removed from their capsules and put in tubes, the coins are susceptible to scratching as are Maple Leafs.

In going in the rear a piece of the $2.4 a billion .9999 fine gold gate coin market, the Mint needs to consider the mindset of precious metals coin investors. precious metals coin investors seek alternatives to paper money; they are not coin collectors. metal 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 as long 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 bump when dropped. Gold Eagle tubes, on the other hand, are virtually indestructible.

For protection at cross-purposes with “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 succeeding the cast coin market, and 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. yet capsules are excellent for protecting epicure coins, coins individually packaged in capsules require more space for storage. The other port 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 aesthetically appealing 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 betwixt 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 bandy words that the Standing Liberty and the Walking Liberty designs are life used in the American Eagles program, and, therefore, the Mint should go onto new 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 ingot coin investors a strong alternative, then it has a golden opportunity to seizure a big share of the .9999 fine gold ingot market. With the right planning, the Mint could shake the Maple Leaf’s hold on the .9999 precious metals coin market.

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