Metals Surge During Economic Chaos

By Richard Giedroyc What determines the value of coins does not happen in a vacuum. Supply for certain coins may be fixed, but the demand for them is elastic. That demand often increases in times of crisis. The strength of the dollar on world markets had been driving the spot price of gold and silver and all coins impacted by those prices down for some time. Then came heavy losses by Bitcoin and Ethereum in early March. Every leading cryptocurrency took double-digit percentage losses by the end of the first week of the month. The failure of the crypto bank Silvergate and subsequent failure on March 10 of the physical Silicon Valley Bank made matters worse. On March 13, when this commentary was being written, gold had surged 2.5 percent, while silver advanced by an astonishing 6.2 percent. Gold and silver American Eagles, intrinsically valued circulation strike coins through 1964, and bullion coins acted accordingly.

All this came about just as cashless society advocates were once more pointing to a decrease in month-over-month U.S. Mint coinage production figures as a sign that the end of physical money may be coming. To put it bluntly: “Fat chance.” Gold coins may benefit even more since, unlike bonds, they don’t pay a dividend, but they may increase further in value due to the economic chaos just explained.

The scarce to rare market sector isn’t holding back, either. Holabird Western Americana Collections drew approximately 7,000 online bidders to its March 4-5 “Ship of Gold” sale of coins salvaged from the wreck of the S.S. Central America. Some of these bidders were from Canada, Europe and South America. (See full story on page 21.) No matter where your interests lie, this market still has legs.