A Gold-Buying Frenzy in Chicago

U.S. Mint Release of the Kennedy 50th Anniversary Commemorative Coin is a Disaster!

James DiGeorgia

Since 1974, with precious few exceptions, I have made a yearly pilgrimage to the largest rare coin convention in the United States; held by the American Numismatic Association (ANA).

People from all over the world come to this annual event to meet, attend auctions, and connect on the bourse floor where 1,000+ rare-coin dealers and world mints set up tables and exhibits to buy and sell every kind of rare coin imaginable.

For years, the location of the convention rotated around the country. However, in recent years, the ANA’s World’s Fair of Money was in Rosemont, Ill., near O’Hare Airport.

Over the years, dozens of private and public governments have used this annual convention as a marketing opportunity to launch the sales of re-strikes, and newly minted coins and medals.

This year was no different, but it came with an unfamiliar twist.

It was late in the day when I flew into O’Hare Airport. The very first thing I saw as I jumped off I-90 was an enormous line of people standing outside the convention center.

Frankly, I thought there must be a big concert or some event in which people wanted tickets.

But the next morning as I approached the convention center, I realized the same 1,000 people were still standing in the same line from the night before!

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As it turned out, the throngs of people were ALL standing in line to buy a new U.S. Mint-issued coin at the convention.

It was a Kennedy half-dollar gold proof coin, 50th anniversary edition, selling at $1,240 apiece. These newly minted commemorative coins celebrate the 50th anniversary of the 1964 Kennedy half-dollars.

As I approached the line, I shouted out a question to the people toward the back of the line …

"What’s going on … why is the line so long? Are they giving away money?"

A few of the people in line shouted back:

"Just about!" as they laughed out of frustration.

"They (the U.S. Mint) are selling 500 coins a day."

I looked at the line again and asked if they really thought they had a chance.

"There must be 700 to 800 people ahead of you."

The line to get into the rare-coin convention itself, however, was nonexistent. I noticed a few of my dealer friends and asked them why the bourse floor was so quiet.

"Most of the people attending the show this morning are in that line," they said.

My friends went on to tell me that word had spread throughout social media that you could buy these coins from the U.S. Mint immediately and sell the coins for a profit of $400 to as much as $1,000 a coin at the show.

Since then, some of these coins have started showing up on eBay (EBAY) for $9,000+!

People started lining up the prior day at 4 p.m. and slept on the sidewalk overnight — all for the chance to make some money when the Mint exposition at the convention opened for business at 10 in the morning.

There were some catches of course beyond the 500-coin-a-day limit…

  • You could buy just one coin per person a day.
  • The price that dealers were willing to pay fell, as more and more people were able to buy these coins.
  • The insanity ended midday on Thursday when those running the ANA convention saw the unforeseen dangers outweighing the benefit of letting it go even a single day longer.

These Kennedy commemorative coins were struck by the United States Mint’s facility in West Point and contain ONLY three-fourths of a troy ounce of pure (0.9999) 24-karat gold.

The obverse inscription (heads) includes the dual years "1964-2014." The encapsulated coin is packaged in a single, custom-designed, brown mahogany hardwood presentation case with removable coin well. A certificate of authenticity signed by U.S. Mint Deputy Director, Richard A. Peterson, accompanies each coin sold.

The Coin is Gorgeous, But

Is it a Good Investment?

First, there will be 75,000 of these coins minted. Many will be sent to coin-grading services like Numismatic Guaranty Corporation (NGC) or the Professional Coin Grading Service (PCGS) and will grade Gem Proof 70 condition.

I have played that game over the years and can tell you that this will mean. Some people who get their hands on these coins will make WAY more than a $1,000 per coin while the coin remains RED-HOT.

I stress while they remain hot right now, because they may not be so hot in a few months.

After all, there are 75,000 of these being minted — and that’s a lot for any modern Mint-issued product.

Over my 40 years of buying Mint products, I can tell you that, more often than not, these kinds of coins tend to fall in price after the frenzy subsides.

However, these new issues are artificial rarities. They are packaged products by the Mint to whip up sales for its growing product line.

Like the Post Office’s proliferation of commemorative stamps, selling newly minted special releases has become a BIG business for the Mint.

I personally prefer buying real rarity. Give me a gem Alexander the Great Gold Stater any day over a modern Mint issue. For more on that topic, check out my 2013 article: Ancient Coins: The Money of History Offers Profits of Tomorrow

If you have been able to buy one or more of these new coins, you may want to consider taking the profit and running. You may be better off buying a one-ounce coin like a 24K U.S. Buffalo 24K with the money.

After all, when gold eventually hits $5,000, you won’t hear the dealer to whom you’re selling the coin lamenting the fact that it’s only three-quarters of an ounce!

I led this article with the headline …’U.S. Mint Release of the Kennedy 50th Anniversary Commemorative Coin is a Disaster!’ with good reason.

It turns out that many of the people in the line were actually bussed and brought to the show by a group of rare coin dealers via Craigslist, like day laborers. They stood in line by the dealers to buy the allotted number of gold and silver coins for a flat fee.

Here’s what that means …

The dealers were able to find a few hundred people willing to sleep on the street for a few days so they could get around the per-person limit of coins sold.

In short, the U.S. Mint instituted the one-coin limit to allow private collectors the opportunity to buy at least one.

Not only did that NOT work, but a Coin Week reporter allegedly heard a collector discussing what was taking place with one of the dealers at the ANA convention …

The dealer had stacks of graded coins offered at $5,000 apiece and heard the dealer tell the collector that most of these coins will be sold to unsuspecting buyers on coin television shows.

This dealer reportedly went on to say those buyers are so clueless, they think they are getting a good deal.

Making it worse, the collectors first in line to buy the first four coins at $5,000 apiece from one of the dealers supposedly later sold to a retail collector/investor for $100,000 after the coin was graded by PCGS at the show! These received a special commemorative "first coin sold" label.

FYI, this "first coin sold" designation doesn’t really mean a damn thing. It’s nuts!

So, the U.S. Mint release of these new Kennedy commemorative silver and gold coins wasn’t just a disaster from the standpoint that collectors really didn’t have a fair shot at getting them …

Not to mention, a handful of dealers will make a few million on the back of the U.S. Mint and taxpayers …

When people find out in a few months or a year that the gold Kennedy 1964-2014 coin(s) they paid $100,000 or even $5,000 for are actually worth $1,900 to $2,500, we could see a decline in rare coin buyers in the future.

That’s a genuine disaster for the rare-coin industry!

When I arrived home, one of my dealer friends mentioned the REAL reason the ANA and U.S. Mint shut down the coin release in Chicago …

As it turns out, apparently there was an armed robbery in one of the men’s bathrooms at the convention center. A criminal who discovered what was going on simply bided his time and watched people take delivery of their coins until he saw one person vulnerable.

As you know, I’m a big fan of taking possession of your bullion and not storing it with a dealer. This story serves as a good reminder to all of us who collect coins to always think about our safety after the transaction ends.

Collecting coins can be a fun and profitable pursuit. Just make sure you’re pursing the best values, and that you’re protecting the most valuable investment of all … yourself … at all times.

Always Watching Your Chickens,

James DiGeorgia

Your thoughts on “A Gold-Buying Frenzy in Chicago”

  1. The regular PCGS PR70 “first strikes” are now going for $1300 to $1500 — a significant decrease from just a few weeks ago… and the “Chicago ANA” PR70 slabbed varieties are in the low $2000s. Even if the price of gold stays around $1300, I predict that a slabbed 70 “first strike” of this coin can be had for less than issue price. Friends, remember, there’s 3/4 of an ounce of gold in this coin, not a full ounce.

  2. I ordered mine via the web and it should be here today. It will probably go in my album ungraded with the other 190 or so Kennedys I’ve collected. I have a sample of every Kennedy minted except for the 74 doubled obverse. Thats next on the list. This is a great hobby.

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