Whats Old

Gold Shares Versus Rare Gold.

It is generally accepted that in times of financial upheaval gold bullion is a safe haven asset, and gold mining shares offer “leverage” to gold, sometimes rising 3- 1 against spot bullion.

However, during the stock market upheaval of August 2007, the XAU index and the HUI index of gold mining shares tumbled 20%, where as the general stock market indices declined approximately 10%.

In fact, while mining shares tend to lead gold in a bull market, the record shows that rare coins have typically caught up later and passed them both. For example, in the historic gold bull market of 1976 to 1980, an eight-piece rare U.S. gold set in MS-65 grade far outdistanced the gains in gold bullion and in all but the most speculative of gold mining shares.

Rare U.S. coins have yet another critical advantage, one not shared by either gold bullion or mining shares.

Rare coins have proved to have a unique ability to rise in price even when gold is moving sideways or falling. Because of their rarity and status as a collectible, gold coins can keep rising whenever there is an increase in demand, no matter what the reason.

A perfect example of this occurred in the late 1980s. During the 18 months between April 1986 and September 1987, gold bullion rose 35.3 per cent. Meanwhile, gold shares (as measured by the XAU index) soared by 126.3 per cent. In comparison, eight-piece rare gold coin sets rose a mere 18.8 per cent.

The gold bull market was brought up short by the Black Monday stock crash. The fall in share prices was so deep and widespread that it created a massive liquidity crunch.

Many investors were forced to look for cash in every area of their portfolios, and as a result gold and gold shares dropped 18.9 per cent and 39.7 per cent respectively to June 1989.

But during this same period, rare gold coins rose by 120.3 percent.

This was not a one-time event, either. From July 1984 to June 1986, for example, gold dropped by 1.2 per cent and gold shares by 23.7 per cent. At the same time, rare gold coins rose by 18.9 per cent.

And from November 1990 to April 1992, gold dropped by 12.6 per cent and mining shares by 18.0 per cent, yet rare gold coins rose by 19.4 per cent.

This unique ability to leverage the gains in gold, and often to rise in value even when gold drops, is why I recommend rare U.S. coins as a critical component to a complete precious-metals portfolio.

That's not to say that rare coins will never drop in price; all investments run in cycles, and all investments entail some degree of risk. But rare coins happen to be near the bottom of an exceptionally wide price swing right now, making today's opportunity even more dramatic and potentially profitable.

Of course there is a short-term risk in this strategy, as we all know what traditionally causes precious metal prices to rise (inflation, war, any severe economic unrest) but in the long term the best bet will always be with the coin that has some numismatic value in addition to its high gold content.

READ THE SOURCE ARTICLE HERE Not All Gold Created Equal

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The Clues, The Clues

Six years ago I was fortunate enough to be sailing around the South China Sea as part of a marine archaeological expedition in search of Manila galleons, the largest treasure ships ever to sail the oceans.

Several like-minded dealers and I were funding a search of a specific vessel that sunk in 1572 carrying 3,000,000 silver “pieces of eight” and nearly 50,000, gold Doubloons.

The significance? Possibly as much as $1 Billion, conservatively $500,000,000.

Sadly, we never found the mother lode, but the experience was priceless and worth every cent of the $250,000 it has cost me to date. ( The crew are still out there as I pen this missive) From this sum, more than $100,000 was spent on research- The Clues, The Clues.

The odds of actually locating the mother lode are far greater than locating the proverbial needle in a haystack. However, my opinion was and still is, that unless you look you will never find anything. It is better to have loved and lost, than to never have loved.

In the words of the legendary treasure hunter Mel Fisher: “Today is the Day”.

The reason that I share this with you is that today is today, tomorrow never comes. Tomorrow is a blank page that we all get to write afresh. Nobody can accurately predict what events will greet us when we awake.

On October 28th 1929 who could have thought that the next day, would forever be known as Black Tuesday and spawn a new economic expression: Depression

On Sunday October 17, 1987, who could have predicted stock markets would fall 22% before breakfast?

Returning to my adventures six years ago, a major storm blew into the South China Sea calling a premature end to our search. For the first time in 3 months, I was able to check into a hotel. I had a real bed, air conditioning and cable television: 200 channels with nothing on.

As I lay there surfing the channels I came across a French network and saw what I thought was a very strange film. It showed one of the two towers of the World Trade Center in New York on fire.

I quickly switched to CNN just in time to see a second plane strike the towers.

Who could have known?

Well, as we now know, quite a few people. The clues were there.

Tom Clancy the author had written a book, a FBI field agent had made a report, the department of defence had been practising an emergency scramble of fighters, and the CIA, well as we know from Iraq, they know nothing. According to conspiracy theorists the president and vice president were also in the loop.

Obviously, the exact date and time were elusive, but the clues pointed to a spectacular event, which simple precautions could have prevented. September 11th will forever be known as the day when the lives of every single man woman and child on this planet changed.

This is why it reminds me of today, Thursday July 26th 2007. The entire world agrees that we are experiencing the greatest period of prosperity ever. Stock markets, the most common measure of prosperity continue to rise, property prices are offensive, and unemployment is pretty much the lowest it has ever been.

We are convinced that the summer of 2007 will go down as the beginning of the end. And here is why:

"The Greatest Economic Boom Ever: Enjoy It While It Lasts" So says US treasury secretary and former Goldman Sachs banker Hank Paulson: For the full article, as published in Fortune magazine click here Click Here

$100 BILLION SUB PRIME LOSSES:Federal Reserve Chairman, and Ex Goldman Sachs Banker Ben Bernanke: Click Here

Not sure what all the fuss is about? Don’t be embarrassed, neither did I until I read this: Click Here

If history is our guide the recent turbulence in stock markets, treasury bonds, housing and credit markets is just a blip. Possibly a healthy, short-term correction.

However, if this is the case, it means that THE BIG ONE has yet to come.

Considering we have had a period of prosperity unprecedented in history, could the following crash also be unprecedented?

All the staff at Signature Rarities work under my direct supervision. It is not there job to tell you what the risk is to your financial future. That is up to you to calculate using your own personal benchmarks.

Our work at Signature Rarities is not to convince you to put all your money into "old coins." Our job is to locate for you what represents a tangible asset of last resort. A safety net for you and you family.

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The Bourse Floor

I had the opportunity to attend the first ever Florida United Numismatists (F.U.N) show, Palm Beach Florida on July 12- 13th.

Wow! What an event.

Although we have seen a little softening in the general numismatic market, with the public attendance a little weak. The bourse floor was active from day one with dealers trying to fill want lists. Without a shadow of doubt, we are experiencing a subtle shift to rarity.

To explain: 5 years ago, when attending an auction it would generally come down to 3 or 4 bidders raising their paddles for the very best material.

Today, not only are prices breaking records, there are dozens of bidders for the six figure coins. In my opinion the market has been driven by rising metals prices, with a lot of telemarketers and the home shopping channels absorbing huge amounts common date generic pieces to ship to little old ladies who want something for the grandchildren.

Now, the serious collectors have ambitions that cannot be matched by supply. For the second year in a row, our want list has barely moved in value. As soon as one item is located, another is added. This is not a problem, as it keeps our buyers on their toes, and after all that is our reason for existing.

A Few Highlights from the auctions:

• 1827/3 25C Restrike PR66 NGC: Realized: $126,500
• 1893-O $1 MS65 NGC: Realized: $115,000
• 1807 $5 Bust Left MS65 PCGS: Realized: $103,500
• 1915-S $50 Pan-Pac Octagonal MS65 NGC: Realized: $100,625
• 1896-O $1 MS65 NGC: Realized: $100,625

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Peter Schiff- Agora Financial

What Record High?

As the Dow burst through the 14, 000 milestone this week, few understood the hollowness of the achievement. Measured against the rising dollar-denominated prices of just about everything else on the planet, the Dow has actually lost value over the past seven years.

Measured against the truest benchmark, the price of gold, the record high for the Dow was set back in January of 2000 when its price equalled approximately 43 ounces of gold. Today it is only worth about 19 ounces.

To better appreciate just how much of stock gains can be attributed to inflation, consider that the record high for the Dow in 1929 of approximately 380 also equated to 19 ounces of gold. So despite all of the hoopla and a thirty-fold increase in stock prices, the Dow has actually gained no real value during the past eighty years.

The entire rise from 360 to 14,000 has been an illusion made possible by the magic of inflation.

Now that is not to imply that the Dow has not generated returns during those years: it has. However, those returns have been a function of dividends and not appreciation. But its not yields that Wall Street celebrates, its prices. By dazzling investors with higher prices, they distract their attention from the unpleasant reality that they are actually treading water. What difference does it make if you have more dollars if the dollars themselves have less purchasing power?

Despite its recent eclipse of 14,000 the Dow now buys 30% fewer euros than it did then back in 2000 when it was priced at approximately 11,500.

• 35% fewer gallons of milk
• 40% fewer bushels of corn or wheat
• 65% fewer ounces of silver
• 70% fewer barrels of oil
• 80% fewer pounds of copper
• 90% fewer pounds of uranium

Try figuring what the Dow will buy in terms of other necessities, such as housing, insurance, college tuition or hospitalization. Any way you measure it, the Dow is worth far less today then it was in January of 2000.

Back in 1980 one Zimbabwe dollar was worth more than one U.S. dollar. Therefore a billionaire in Zimbabwe was also a billionaire in America. Today, almost everyone in Zimbabwe is a billionaire yet few of them can afford a pack of chewing gum. Do you think that anyone invested in the Zimbabwean stock market these past 30 years cares how many record highs that market has made?

Many might feel that a comparison of the U.S. to Zimbabwe is ridiculous. However, fundamentally there is no real difference between a Zimbabwean dollar and an American dollar. They are both simply pieces of paper, the value of which depends on the resolve of politicians not to print too many of them. During the difficult economic times that lie ahead, the pressure on the Fed to run its printing presses full throttle will be immense.

Think back to the German experience with hyper-inflation during the Weimar Republic. At the time of its currency meltdown, Germany was a major economic power (even after the devastation of the First World War). Yet that status did not prevent its currency from becoming worthless. The impetus for Germany’s hyper-inflation was the fact that its industrial base had been badly damaged during the war, yet under the terms of Treaty of Versailles it was obligated to pay enormous reparations to the Allies. Lacking the ability to export enough goods to repay its debts, it resorted to a printing press instead. America is now in a similar predicament. Although our industry was not destroyed by bombs, it’s gone just the same. While we might not be bound by a treaty to pay reparations, the trillions of dollars of American IOU’s now owned by foreigners will be just as burdensome an obligation. It is hard to image we can “repay” these debts without civil unrest, massive inflation, or both.

The point to remember is that when it comes to records, it is real purchasing power, not nominal value, that counts. Measured by its purchasing power, the Dow has clearly lost value over the past seven years. Those who have remained invested in Dow stocks during that time period are clearly poorer as a result. Those who continue doing so will likely loss even more wealth in the years ahead, regardless of how many more nominal record highs the Dow sets.

For a more in depth analysis of inflation and how government statistics cover it up, read

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Your Rare Coin Retirement

State pensions are nothing short of a glorified Ponzi (Pyramid) scheme. The “insurance” we all pay is just another tax that ends up in the same pot as all the other taxes. Obligations paid to those lucky enough to be retired are paid from current tax revenues.

A recent study conducted by Deutsch Bank estimated that in the year 2050 there will be 75 pensioners for every 100 workers in Europe. This makes the possibility of a comfortable retirement based upon contributions made during our working lives increasingly remote.

Private pensions are not much better off.

While liabilities to current retirees grow, the assets behind the schemes have shrunk. In 1997 the top 100 companies in the British stock market (FTSE 100) had pension schemes funded by 132% of obligations.

Following a tax raid, rule changes, stock market underperformance and an ageing population this has fallen to about 70% funded today.

According to the Pension Protection Fund, an organisation that insures UK pensions against collapses, during August 2007 pension funds saw their aggregate pension’s surplus melt from a £51 Billion surplus, to just under £27 Billion. At the same time 73% of defined benefit, pensions are under funded.

In the USA General Motors has 1 active employee for every 2.5 retirees in the company scheme.

The annual fixed cost of paying their pension obligations to 420, 000 ex- employees is destroying the company. Just providing heath care insurance costs G.M $10 Billion per year.

Once ranked as the world’s largest company G.M is no longer in the business of making a profit for shareholders. They are in the business of making a profit to pay their pension liabilities.

The combined pension liabilities of Germany’s DAX 30 companies are an amazing 31% of their combined market capitalisation.

The Pensions Sicherungs- Verein, is an association that insures corporate pensions against insolvency set up by the German government in May 2006. The fund is already being sued by members for the way it has handled a 2 Billion Euro payout to 170,000 workers whose pensions have collapsed.

In the Netherlands, one of Europe’s best state pension schemes, the liabilities of the AEX 25 equals 26% of market capitalisation.

So what can you do?

For a start, make yourself responsible for your own future. If your government or private pension does pay out, consider it a bonus. When this has been discounted, you will have a clearer picture of the problems you face and what needs to be accomplished.

And here is the premise of our report: 12 silver, gold and rare coins costing between £50 and £2,000 with a median price for all twelve of about £300 per coin.

we all know the saying that the only thing guaranteed in life is death in taxes, but if you had set aside 10% of your gross income in 1972 ($1,300), it would have bought you almost 1 Kilogram of pure, 24 karat gold.

Adjusted for inflation, you would need $10,315 to have the same purchasing power of $1300 in 1972.

In the stock market S & P 500 Index (gross of tax, and dividends reinvested) it would be $18,000.

In a bank account before tax it would be $3700.

In the PCGS 3000 rare coin index it would be $72,000.

For more information on the possibilities of a Rare Coin Retirement please email your advisor, or if you do not have a contact simply click here. Send Mail

Don’t delay, everyday, week or year you wait you loose.

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Monetary Reform

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“Let me issue and control a nation’s money and I care not who writes the laws.”
Mayer Amschel Rothschild (1744-1812), founder of the House of Rothschild.

8 Trillion, nine hundred and eighty six Billion, four hundred and two Million, 570 Thousand, 107 Dollars, and 59 Cents.

Debt of the United States government, owed to private bankers, as of 30th August 2007.

US National debt increases about 1.5 Billion per day click here for the latest figure.

THREE TRILLION more than the $5.95 Trillion owed in 2002 when the United States came within 6 days of defaulting.

READ BBC NEWS- June 24th 2002

"The few who understand the system will either be so interested in its profits or be so dependent upon its favours that there will be no opposition from that class, while on the other hand,.......

.....the great body of people, mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to [against] their interests."
The Rothschild brothers of London writing to associates in New York, 1863

To repay NINE TRILLION dollars at $1,000,000 per day it will take 190,000 years.

During the 8 years of the Bush administration, the United States has borrowed more money (mostly from foreigners, many of them hostile nations: Iran, Russia, China, Venezuela, etc) than all the money borrowed by every US president combined from George Washington to Bill Clinton.

It may come as surprise to many that the government has created less than 3% of all the money in the British economy. The remaining 97% is debt that carries an interest charge. Every single coin and bank note created carries an interest charge. This charge increases the sum of money the economy owes by an amount that is greater than the total of money that exists.

This charge increases the sum of money the economy owes by an amount that is greater than the total of money that exists.

Standard and Poor’s the credit rating agency tracks corporate bond issues from around the world. For 20 consecutive months those issues designated “speculative” or Junk has grown. Junk bonds now account for almost half of all issues- 1,582 rated “investment grade” versus 1,571 issues receiving Junk Status.

Among the blue chips Included in this count are Ford Motor Company, which has total liabilities of $121 billion of bonds designated Junk. From which $57 Billion is due for repayment over the next five years.

Official US Government debt is $9 Trillion. Can this debt ever be re-paid? Of course, it can! By printing more money.

Further more as of April 2007 Euro-zone M3 money supply (the amount of new cash printed and pumped into the economy) is running at 10.3 %, its highest level since 1983. In the past six months, the E.C.B has also sold nearly 250 ton’s of gold into a rising market.

Essentially the Euro is the world’s first sovereign currency devoid of its own sovereign; it isn’t backed by a sovereign government or entity. Since the Euro launched citizens have lost 10% of their purchasing power.

The bottom line is that the E.C.B cannot print money fast enough.

In a paper published in 2004 by the British national statistics office it is possible to calculate that when Britain went off the gold standard in 1931 a 2004 British pound has 1.78% the purchasing power of that 1931 pound.

Where as from 1550 through 1931 the Pound Sterling depreciated by only 30%. During that 500 years most of the real depreciation can be explained by increased silver and gold production.

Even more overwhelming is the fact that in the decades prior to World War 1, the British pound sterling was equivalent to 1.5 Kg of sterling silver (90% pure). Today one-pound sterling is equivalent to about 5 grams of sterling silver.

After nearly two decades of actively trading rare coins and precious metals, never has there been a more urgent need to diversify your assets.

Beginning in Mexico 1995, then the Asian currency contagion of 1997, the Russian default in 1998, Brazil in 1999, the tech bubble in 2000, the outright fraud of the Enron years, followed by the February dive in world Markets, and another 6 per cent drop in China on May 30th, we could be witnessing the tremors of a world monetary collapse. The after shocks may last decades.

On Monday October 19th 1987 investors across the globe awoke to find the stock market’s had dropped more than 20 per cent, equivalent to about $500 Billion. On February 27th 2007, investors awoke to find the market had dropped 8.9 per cent. Equivalent to $600 Billion, which barley raised an eye brow.

Is it mere coincidence that bankers and fund managers are spending ludicrous amounts of money on fine art and other proven stores of wealth? or do they know something that you do not?

And one last quote

Signature Rarities specialize in creating precious metal and numismatic portfolios completely independent of any government or private agency. By adding an allocation of rare coins and precious metals to your portfolio you can decrease risk and at the same time increase return.

For more information please feel free to email me. Send Mail

Sincerely,
Stuart Allen
Managing Director.

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Rare Gold Coins Out Perform Bullion by as Much As 3-1.

Westcliff, Essex (PRWEB) December 31, 2006 -- Over the past 5 years purchasers of gold bullion have seen the price of the yellow metal more than double from $320 to $630 per Troy Ounce (31.1 grams), peaking as high as $740.

Over the same period a mint state $10 Indian Head gold coin (1907-1933), containing half the weight in gold (15 Grams) has rocketed from $650 to $3,000. More remarkable is a smaller denomination in the same series. The $5 Indian Head, has only 7 grams gold, but in only 2 years the wholesale price has moved from $1300, to an astounding $4,000.

Stuart Allen managing director of Signature Rarities Ltd, (www.signaturerarities.co.uk) one of only a handful of European dealers specializing in certified pre 1933 US gold and silver remarked:
"As good as the rises in the price of gold, informed collectors have long known the benefits of possessing coins. The key is rarity, not the metal"

Allen classifies a rare coin as one with less than 100 known to exist. As an asset, he recommends collectors concentrate on certified coins. These are examples that have been independently authenticated and assigned a universally accepted grade. Measured on the Sheldon scale between 1 (worn smooth) and 70 (flawless) only coins attaining a grade of 60 or more are classified as Mint State (MS).

Allen continues: "Coin collecting is more than stashing some old pocket change in a tin for the grandchildren. I consider purchasers as temporary custodians of a relic that is a direct link to the past. Nobody knows what that future may hold for prices, but one thing is in no doubt; as long as money exists it will be desired and collected."

A recent study conducted by Dr Robert Brown, Chief investment officer at GE Capital, and published on the Journal of Financial Planners web site (www.fpa.org) found rare coins to be more than 40% below there 62 year trend line. Furthermore the report calculated rare coin collectors received a mean return of 10.46 per annum, compared to a compound return of 7.44% from the S & P 500 stock market index.

   With record amounts of money in circulation, and more being printed everyday, Allen predicts collectors will continue their quest for quality coins. "The U.S dollar is near record lows of almost 2-1, against the British pound. Collectors this side of the pond have an amazing advantage in purchasing power".

Norman Martin, CEO of Superior Rare Coinage, Inc () located in Freehold New Jersey concurs: "competition is fierce, European buyers have ambitious strategies, and a lot of material we send over there will be gone for generations, some may never find its way home".

2007 looks ready to kick off with a new record price paid for a coin. On January 2nd the auction of the finest of 5 known 1913 Liberty Head design 5 cent "Nickel" takes place in Orlando, Florida. In 1996 another example of the 1913 nickel became the first coin to breach the million dollar barrier.

Pre auction estimates suggest the final hammer price could reach $5 Million, and could even break the record for highest price ever paid for a coin. Could this "monster" be destined to find a new home this side of the Atlantic? Allen laughs then replies: "that's only £2.5 million sterling, just on the exchange rate it's a worthwhile play".
PDF Press Release 28/12/2006

The 1913 Liberty Nickel.

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The year 2007 started with the sale of one of the most famous numismatic pieces in the world. Sold in 1996 for $1.8 million, then again in 2004 for $4.1 Million the coin was widely expected to break the $5 million barrier.

In the event it received no bids from the floor at the time, although severeal buyers expressed interest in a private sale. That sale has finally occured for a reported $5,000,000.

Outside of the numismatic community, the liberty head became famous after being central to the plot of an episode of Hawaii 5’ O, the 70’s police drama. Featuring Steve McGarrett and his side kick Danno, the episode from 1974 was titled “The $100,000 Nickel. This price seems a bargain price 30 years later. McGarrett and his team track a thief who stole the coin from a hotel. Predictably the coin is located and returned to its owner.

Again in 1996, the Liberty Head nickel made headlines out side of the collecting community. The Eliasberg specimen became the first coin ever to break the $1,000,000 barrier for an individual coin. Within a few years it had changed hands for $4, 100, 000. And it is this same coin that is for sale on the 2nd of January 2007.

The 1913 Liberty head nickel is one of numismatics great stories. Struck from 1883 through to 1913, the liberty nickel is also known as a V nickel for the Roman numeral 5 dominating the obverse surrounded by a laurel wreath.

The legend began when in 1912 when congress authorised a new design of the 5 cent piece. To be introduced into circulation during 1913 the buffalo nickel would feature an American an Indian chieftain on the obverse (date side) and a bison standing upon a mound, on the reverse.

However, planning had been in place for the Liberty type to be struck in 1913, and dies had been prepared. There isn’t anybody who knows for sure how the coins became into being, but is widely assumed Samuel W. Brown, an established coin collector who lived in Philadelphia and worked at the Mint was a central figure.

Again exact circumstances elude us but either brown was already holding all five Liberty Head nickels, or he had heard of them and wanted to acquire them, but he advertised in the December 1919 issue of The Numismatist to pay $500 each for any such coins that were out there. In January 1920 he raised the reward to $600.

The ploy was successful and in August 1920 Brown stunned the coin collecting community by displaying all five examples together. None of the viewers of these five coins would have known they would become famous beyond anyone’s imagination.

The liberty head nickels settled in various collections, including the Walton family and one landed in the collection of King Farouk of Egypt, Ambassador Henry Norweb of Cleveland and the finest of all, known as the Eliasberg specimen. At present only 3 coins are in public hands, with one in the Smithsonian Collection, another in the American Numismatic Association Colorado.

The current world record ever paid for a single coin is held by the 1933 St Gaudens. Auctioned in New York 2002 bidding reached $8 Million.

Stack Auctioneers- The 1913 Nickel catalogue.

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