Chapter forty-six. I lost a ton of money on silver and gold

Yes, you read that right - I lost a ton of money on silver and gold.

In the mid 80s I had money enough from time to time to purchase both gold as well as silver. I had quite a collection going. My focus then was old US gold coins. Not the new coins, but the older circulation coins from America's history, minted prior to 1933. They were the coins people once used to buy every day items. The gold coins which a person would toss onto the bar to buy drinks for example! It was simply our every-day currency. (although the word currency usually implies paper money).

A "double-eagle" was worth twenty US dollars back then. Sounds hard to believe doesn't it? An "eagle" was worth ten-dollars. At my peak of buying I had a couple dozen double-eagles and almost as many eagles, plus some three-dollar coins and a few silver bars! I also had a 1909 S VDB penny - the most sought after US penny ever.

Everything I had was certified by PCGS, and all but one eagle were MS64 or better. That one was XF45. And that was my most valuable coin! Not because it contained more gold (content). Not because it was in the best condition (XF45). But because it was so scarce!
A gold eagle like mine.
My three-dollar coin was just like this one.

Click here for listing of coin grading: What are coin grades?

Besides the grading of a coin other factors come to bear on a coin's value. One of the most important factors is, "how many exist?" In the case of my above mentioned XF45 coin there were just 26 known to exist. This was determined using statistics from the top tier grading services and the information is called "Coin Pop" and is published by them for collectors to use.

So, the number of gold eagles known to exist in the condition of mine (XF45) was just 26! There were nearly none in better condition. I had a really rare coin. I emphasize the word HAD!

One three-dollar gold coin such as the one pictured above in MS64 condition would go for thousands of dollars. There is one on eBay right now for $8,950.00.

So, you can easily see how I lost of over $35,000.00!

Factors that effect coin value: What matters in coin values?

Today, both silver and gold are worth more dollars than when I bought those coins. Gold sold from 300 to $400 then. Today spot price is $1,175.00. If I had been able to hold them, not only would I be able to recover my costs but would have made a tidy sum for profit! The loss was 35K, plus an additional amount even more than that. Possibly over a hundred-thousand dollars total loss!

Keep this in mind today when someone tells you gold and silver are a bad investment because "the price is down". Yes, there have been fluctuations (gold sold for nearly two-thousand dollars an ounce not long ago) but, in the long run, - it has always gone up.

So, my point is this:


The one and only way you can lose is to do what I did in the 80s.
 If, on the other hand, you don't sell off in a low market  you can never lose!