October 2009

U.S. MINT FOREGOS SOME 2009 COLLECTOR AND BULLION COINS

On October 6 the United States Mint announced that it will not strike certain American Eagle coins during 2009. Coins that will not be issued this year include silver eagles with proof and burnished uncirculated finishes, individual proof gold American Eagles in all sizes or sets containing them, the one ounce gold American Eagle with a burnished uncirculated finish, and platinum American Eagle bullion coins.

In November 2008 the Mint announced that it would reduce its numismatic products by more than half, including the elimination of some gold and platinum coins it began offering in recent years. The decision to forgo production of proof and burnished uncirculated silver eagles is attributed to unprecedented demand for the bullion version of the coin. By the end of October, sales of 2009 silver eagles through the Mint's authorized network of purchasers had already broken the record set during 2008. Due to a shortage of blanks, bullion gold and silver eagle sales were restricted during much of 2008 and into 2009. Rationing ended several months ago, but the Mint continues to funnel all gold and silver eagle blanks to bullion coin production. The Mint notes that it is required by law to produce the bullion coins to meet demand but is not obligated to issue collector versions of the coins.

2009 one ounce proof American Buffalo gold coins and proof one ounce platinum American Eagles will be issued, with tentative initial sale dates set for October 29 and December 3, 2009, respectively. These products can be ordered directly from the U.S. Mint once sales do begin.

DID YOU KNOW?

While counterfeit coins have been around nearly as long as coin collecting itself, widespread production of fake coins in China sold on eBay and through other channels is making them increasingly commonplace. Counterfeit coins and real coins with altered dates and mintmarks are intended to trick collectors into paying far more than fair market value (if there is any value at all). Whereas U.S. law requires that any coin replica be plainly and permanently marked with the word COPY, there is no such requirement in China. Fake U.S. trade dollars from China have been a problem for some time, but more operations have sprung up and the counterfeiters have branched into other U.S. as well as Russian, Canadian and other coins. In some cases the fakes are harshly cleaned or made to appear circulated to disguise their origin.

Some Chinese counterfeits are crude and easily detected, but others are deceptively realistic. Moreover, some counterfeit coins are now being sold in fake PCGS and NGC holders (PCGS and NGC are the two leading coin authentication and grading services, and they guarantee the authenticity of coins they have certified). Early fake slabs had labels with misspelled words and/or invalid serial numbers, as reported in a previous issue of our newsletter. More sophisticated examples have since appeared.

What can you do to protect yourself? Fortunately, there are some relatively simple, common sense precautions collectors can take that were largely appropriate before the deluge of Chinese counterfeits. Coins should always be purchased from trusted dealers or auctioneers, who guarantee their merchandise is genuine and back it with an indefinite return period, should authenticity come into question. Buying coins from unknown sources or non-professionals is asking for trouble. Be particularly suspicious of any rarities offered at bargain prices. Remember the adage - "if it sounds too good to be true, it probably is." To this age old advice we now add that you should never purchase coins from any seller in China, period.

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