Which Rare Gold Coins Can Weather the Storm?

By Doug WinterRareGoldCoins.com …… CoinWeek Content Partner
 

I’ve been a full-time professional coin dealer since 1981 and I’ve been through numerous down markets. My experience has proven that there is no such thing as a “recession-proof” coin. Even the best coins go down during bad markets, and these represent great buying opportunities for contrarians or for collectors who have the means to afford luxury purchases during times when even necessities seem like difficult spending decisions.

I have selected four areas in the rare date gold market that I think will show the least amount of downside during the coming months. With the exception of bullion, nothing is likely to not dip in price through the summer but these areas have enough collector strength to survive reasonably intact.

Selected Early Gold

If you called Early Gold (coins struck from 1795 to 1834) the ultimate “Blue Chip” area of numismatics, you’d get no argument from me. But this is a wide-ranging field and there are clearly issues that are likely to survive a bad economy more intact than others.

To me, the most recession-proof Early Gold ticks all or most of the following boxes:

  • Graded by PCGS and approved by CAC
  • Priced at $20,000 USD or lower, with selected exceptions
  • Dated in the 1790s
  • Choice and original with pleasing natural color

A few weeks ago, I offered a lovely NGC/CAC AU55 1799 half eagle with great color and surfaces as my Coin of the Week. It sold with multiple inquiries within an hour of appearing as a targeted email. Yet two weeks later, I emailed a pair of choice 1803/2 half eagles in NGC/CAC AU58 and PCGS/CAC AU55 and they didn’t register a single order. So there’s no guarantee that any specific early gold issues are “no-brainers” in this market.

Choice Dahlonega Gold

I’d select coins from this Southern mint as the most avidly collected branch mint issues. This is especially true if the coin checks a number of the following boxes:

  • Priced at $1,500-7,500
  • CAC-approved or at the very least choice for the grade
  • Scarcer or slightly better date
  • Attractive color and choice surfaces

1861-D $1.00 PCGS AU55 CAC. Images courtesy Doug Winter Numismatics

1861-D $1.00 PCGS AU55 CAC. All images courtesy Douglas Winter Numismatics (DWN)

I can’t think of many D mint coins that will drop much in value during a bad economy except for common, overgraded issues priced in excess of $10,000.

I’d also bet that nice, fresh examples of key-date Dahlonega issues will do just fine (if you can find them). This includes dates such as 1855-D and 1861-D dollars; 1840-D, 1855-D, and 1856-D quarter eagles; 1854-D threes; and 1838-D, 1842-D Large Date, and 1861-D half eagles.

Interesting Low-Pop Gold Priced at $7,500 and Below

This is a pretty broad category and it includes many of the coins which my firm typically buys and sells, recession or not.

I’d define “interesting low pop(ulation)” as a coin that makes you go “hmmm… that’s cool, haven’t seen one of those in a long time,” and one that makes you think “$5,000 is pretty fair for a coin this cool, let’s buy it!”

Being more numerically specific, I’d suggest these parameters include Philadelphia and San Francisco issues with single-digit populations at PCGS (i.e., nine in EF45 with nine in all grades finer), and Southern issues with low double-digit populations.

Coins that meet these parameters are certainly not risk-free but I’d think that a scarce, interesting half eagle or eagle priced at $5,000 or lower has reasonably limited downside.

Really Scarce Coins

Let’s say you’re a serious collector of No Motto New Orleans eagles. It’s likely that two of the holes in your set are the 1841-O and the 1859-O.

1841-O $10.00 PCGS EF45. Images courtesy Doug Winter Numismatics

1841-O $10.00 PCGS EF45

Now let’s say you see an 1841-O eagle on my website in nice PCGS EF45. You enlarge the images, read my description, and your heart starts pounding. It’s more money than you want to spend right now, but you’ve been looking for this coin for three+ years and you know a better one is likely to be too expensive and virtually non-existent. You might have to get creative and do a partial trade or take terms, but you’re going to buy that coin no matter what.
 


Get Your Copies of Doug’s Books On New Orleans, Charlotte and Dahlonega Gold at CoinWeek Supplies


 

I can think of 50 or more coins that fall into this category. Coins that are demonstrably scarce, avidly collected, and almost never come up for sale.

But not every really scarce coin qualifies. Take a hypothetical coin like a Gem Proof 1878 half eagle. It’s amazingly rare, but unless a type collector or a specialist needs this issue and is feeling flush, it could easily sell for 20 or 30% under current market value.

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I’d be curious to know what coins you feel are recession-proof or close to it. Please add your comments below and let’s start a dialogue! You can contact me by phone at (214) 675-9897 or by email at dwn@ont.com.
 

Doug Winter Numismatics, specialists in U.S. gold coins

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About Doug Winter

Doug_Winter2Doug has spent much of his life in the field of numismatics; beginning collecting coins at the age of seven, and by the time he was 10 years old, buying and selling coins at conventions in the New York City area.

In 1989, he founded Douglas Winter Numismatics, and his firm specializes in buying and selling choice and rare US Gold coins, especially US gold coins and all branch mint material.

Recognized as one of the leading specialized numismatic firms, Doug is an award-winning author of over a dozen numismatic books and the recognized expert on US Gold. His knowledge and an exceptional eye for properly graded and original coins have made him one of the most respected figures in the numismatic community and a sought after dealer by collectors and investors looking for professional personalized service, a select inventory of impeccable quality and fair and honest pricing. Doug is also a major buyer of all US coins and is always looking to purchase collections both large and small. He can be reached at (214) 675-9897.

Doug has been a contributor to the Guidebook of United States Coins (also known as the “Redbook”) since 1983, Walter Breen’s Encyclopedia of United States and Colonial Coins, Q. David Bowers’ Encyclopedia of United States Silver Dollars and Andrew Pollock’s United States Pattern and Related Issues

In addition, he has authored 13 books on US Gold coins including:
  • Gold Coins of the New Orleans Mint: 1839-1909
  • Gold Coins of the Carson City Mint: 1870 – 1893
  • Gold Coins of the Charlotte Mint: 1838-1861
  • Gold Coins of the Dahlonega Mint 1838-1861
  • The United States $3 Gold Pieces 1854-1889
  • Carson City Gold Coinage 1870-1893: A Rarity and Condition Census Update
  • An Insider’s Guide to Collecting Type One Double Eagles
  • The Connoisseur’s Guide to United States Gold Coins
  • A Collector’s Guide To Indian Head Quarter Eagles
  • The Acadiana Collection of New Orleans Coinage
  • Type Three Double Eagles, 1877-1907: A Numismatic History and Analysis
  • Gold Coins of the Dahlonega Mint, 1838-1861: A Numismatic History and Analysis
  • Type Two Double Eagles, 1866-1876: A Numismatic History and Analysis

Finally, Doug is a member of virtually every major numismatic organization, professional trade group and major coin association in the US.

 

3 COMMENTS

  1. My answer is none oif them, not under unless the financial markets remain totally detached from the real economy since that’s presumably where most of the discretionary buying power is going to come from. It certainly doesn’t appear it will come from affluent independent business owners.

    The potential for any high priced coin to lose a lot of value is very high under any extended adverse economic circumstances. Especially coins which aren’t really that difficult to buy. The coinage described here is at least somewhat scarce but much of it isn’t that hard to buy either. Distinction from the TPG grade and CAC stickers will matter a lot less if at all in an environment where most people’s (presumably including collectors) net worth is declining noticeably or crashing.

    There hasn’t been such an environment since the 1930’s. Even during the Great Recession, the financial stress was temporary yet all I read is how poor US coinage in general has performed since at least 2008. If true and the market has been so weak during a period of supposedly extended prosperity, what’s going to happen in a worse recession than 2008 or a depression?

  2. If we were to have a similar or a worse than the one of the 1930’s, I wouldn’t be scared to buy any gold or silver coins that I could get my hands on. I will say that as far as you want to go back to the only person as far back as I have researched that has lost money due to a down market or for that matter even a crash is the ones that have gotten scared and sold matter of fact my research tells me that if ya put in the time and do the research in down or a so called crash there’s plenty of dollars to be made. Correct me if you show me I’m wrong in any of the previous down or so called market crashes it may have taken a little while but the market came back as good nah It’s came back and gotten better than before. My research tells me that if ya get scared and sell that’s when ya loose, the market is at times very volitule so you or someone you know and trust must do the research or you’ll be one of the scared seller’s that looses his shiney hiney

    • While I think there’s some truth to what you’re saying, different things will scare different people to different degrees, so “not selling”–I think–can be easier said than done.

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