Blanchard's  Instablog

Send Message
Blanchard and Company, Inc. is the largest and most respected retail dealer in rare coins and precious metals in the United States. We have helped over 450,000 people just like you with expert consultation and assistance in the acquisition of American numismatic rarities and gold, silver and... More
My company:
My blog:
BERU: Blanchard Economic Research Unit
  • Gold Coin Sales Get Boost From Government Shutdown 0 comments
    Dec 12, 2013 4:03 PM | about stocks: GLD, SLV

    Worries about the government shutdown in Washington prompted more investors to buy gold (NYSEARCA:GLD) coins in October, putting overall sales on track to beat last year's totals, Wall Street Journal reporter Tatyana Shumsky says.

    Gold Coin

    The U.S. Mint, which sells gold and silver coins to the public through authorized dealers, sold 48,500 ounces of American Eagle gold coins last month, more than triple the September total but less than the 59,000 ounces sold a year earlier.

    So far this year, the Mint has sold 752,500 troy ounces of gold coins, just short of the 753,000 ounces for all of last year, Shumsky reports, citing the Mint's data.

    Government Shutdown

    The October surge came as the federal government partially shut down for 16 days because of the fight in Congress over the budget and raising the debt ceiling.

    "We saw our peak order volumes right before the government shutdown, and then again right before the deadline for the debt-ceiling increase," Mike Getlin of Merit Financial, a bullion dealer, told the WSJ. "The debates in Washington spooked people about holding dollars, and that drove up demand for bullion coins."

    But Congress only agreed to a temporary fix, so the fight over government funding and raising the debt ceiling is likely to resume early next year. That could spur even more sales of gold coins.

    Plunge in Gold Prices

    Though gold prices have plunged 22 percent this year, demand for gold coins is climbing. Shumsky says analysts believe people who buy gold coins are investing more for the long term

    "People are just still very uncomfortable about the financial situation worldwide," Terry Hanlon of Dillon Gage Metals, an authorized coin dealer, told WSJ. "We still see very brisk sales when there are [price] drops in the gold market."

    Silver Coins Popular

    Silver Coin

    Demand for silver (NYSEARCA:SLV) coins has been even higher than for gold, in part because silver is less expensive. The Mint has struggled to keep up with the demand for silver coins through much of 2013, the WSJ reports.

    The Mint ran out of the coins in January and imposed limits on coin sales to its authorized dealers. Those limits remain in place.

    Source: "Worries Boost Sales of American Eagle Gold Coins,"
    The Wall Street Journal, Nov. 3, 2013.

    Images courtesy of the United States Mint, used under Fair Use: Public Domain.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Additional disclosure: Blanchard and Company, Inc. is the largest and most respected retail dealer in rare coins and precious metals in the United States.

    Stocks: GLD, SLV
Back To Blanchard's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.