Please explain pre 1933 gold coins that survived confiscation/melt

I recently bought a 1927 St. Gaudens $20 double eagle. This coin is not rare amongst the series as over 2.9 million were minted. How did this coin, and all the other pre 1933gold in existance survive until today? Are these surviving coins a result of individuals and corporations who defied the laws for many decades? Were many of these coins held in bank vaults and not melted and released in GSA events? I know that many survived due to hoards being discovered in various places, but I'm curious as to how the vast majority of pre 1933 gold was not melted.

 

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Are these surviving coins a result of individuals and corporations who defied the laws for many decades?

Who is going to obey a law that is for all practical purposes unenforceable and is perceived to be to your disadvantage?

And of course, there would be stacks of them held abroad, where no such law applied. Bigger holders would see it coming and shift their stacks to Bermuda or Canada.

I don't know how many were actually turned in, but a list of those owner's names would be a goldmine for Brooklyn Bridge salesmen.

 

I'm no expert, but I know that anybody could keep up to $100 FV of gold coins without penalty, and "gold coins having recognized special value to collectors of rare and unusual coins" were also exempt.

Many people probably ignored the order, but there was probably significant public sentiment that it was a good idea, so I'm sure a lot of people were happy to surrender their gold voluntarily.

In addition, as @afantiques said, much was held abroad.

 

The Executive Order allowed individuals to hold up to $100 face value gold without any threat of confiscation or persecution. It also allowed folks to retain gold coinage of numismatic value. Essentially, this loophole was so large as to allow virtually all gold struck by the US Mint to be preserved. Also, quite a bit of US gold was stored overseas and this was, of course, not subject to any melting.

 

another reason at where people/ individual(s) forget over time at where they buried their valuables

http://abcnews.go.com/US/10m-calif-gold-coin-hoard-found-yard-stolen/story?id=22764360

so if it was more than a 100,00 US valve out it goes it the yard =0X

 

Many were held abroad in other banks, companies and people's personal possession. Many still are/maybe. Some have been "repatriated". What you have today could have been reintroduced to the US market after the 70s when the laws changed.

 

Wasn't it $100.00 face value for each year/mint mark?

 

My dad just retired from a lifetime of working in banks, and he says one of his first employers had about $3,000 worth of gold coins down in the vault, that was reported as being shipped back to the Fed, but through some bureaucratic oversight, never was. Not sure what became of them, as that bank was a small local company and was later bought out by larger banks.

 

Thanks for the replies. I did some searching on my own before I posted and the vast majority of what I found was websites trying to sell overpriced gold by claiming private gold ownership will be declared unlawful again. I found very little of what was mentioned above. Thanks again.

 

You can read the original Executive Order 6102 here-

http://www.presidency.ucsb.edu/ws/index.php?pid=14611&st=&st1=

 

I'm sure most of those sites Swagge visited already linked to it too. They usually do, or employ some scary looking graphic of the document in their sales pitches.

 

As far as I know... to the OP's question... the 1927 St Gauden wouldnt be illegal... 2 reasons.

1. You would legally be able to own 5 of these or up to the $100 limit.

2. Any gold coinage of specialized value was not required to be turned in... meaning. If you were building a set of them say collecting each mint mark for the year, they are valued more... making a special value on these. A loop hole if you will that the fed left in the clause because this is a kings and presidents game. Chances are MR. FDR was a coin collector!

That is why there are a lot of shops pushing bullion with muscle... or certified bullion. Because it carries a special value... if the law is ever re-enacted chances are... and they could always change it... but chances are they will just re-enact the law due to this same reason. Meaning all of your bullion coins certified... wouldnt have to be turned in!

That is my translation of it... then you started to see back at that time graded designations. G, F, XF, AU, MS, etc.

 

There's also the question of what future changes of the law would do to IRA compatible bullion.

If certified bullion is classified as a collectible would it not be disqualified or exempt from physical possession in an IRA...?

Not sure bullion with muscle is as strong as the dealers would like to imply under such considerations.

 

Krispy! you are right... Certified collectibles are exempt from an IRA.

There is an advantage to acquiring bullion with muscle... The fact that they trade at a premium over spot... that premium will increase or decrease on the conditions... so you can actually make more... if you trade right.

for instance.

ms63 St Gaudens common dates are generic gold at a low premium over spot... Their 10yr avg is approx 38% over spot. Right now they are at 11.25% over spot... when gold has spiked in the past they have seen 60-80% over spot.

So you see a nice little slingshot action. Buffalos AE etc do the same.

 

I have a question that may sound dumb but when looking at PCGS price guide, I assume they are adding intrinsic value into the coins total value. Could someone just deduct intrinsic value from the price guide to determine numismatic value? What happens if gold goes to $800 an ounce? Would the price of each coin drop about $400 in value?

 

Numismatic value is subjective, though it's something you can estimate and perhaps express in a range of values using auction results of similar pieces, to some degree.

Very generally speaking, yes, there certainly can be impact on a numismatic coins' value due to moves in spot price, but less so with rarities and key dates, more so with newer coins sold by Mints or non-rare common pieces. We see the US Mint regularly adjust its numismatic gold products per moves in the market. There is a matrix they follow for pricing.

You can always determine the intrinsic value of any coin with precious metals compositions. Just look up the specifications for the coin, get the actual silver, gold, platinum, palladium weight for that coin, then put it into a Precious Metals calculator such as this one Dendritics, and it will find the intrinsic value based on current market spot price.

 

No. Truly numismatic coins... dont really trade with gold. We are talking about 1 ounce coins that trade for tens and hundreds of thousands. They might slightly drop... but they will hold their value against the volatility of gold. same with silver. They trade on more of a demand/supply which is strict.

Krispy mentioned moderns... lots of moderns... or bullion with muscle will trade closely with spot.

the Dendritics calculator is good for coins if you dont know what the worth is based on its weight. It should in no way be used for a numismatic coin value. You will lose lots of money possibly if you use it to base your value.

 

Agree.

The OP's sounds like someone that has swallowed a line of baloney from gold marketers about the illegality of pre-1933 gold.

Coin Collecting was just as much a business back then as it is today.

 

I agree highly with this. The hobby is full of stories how US dealers went all over the world in the 70's and 80's to repatriate US gold coins. Europe was the prime source, but Latin America had a lot too. I remember a story from David Bowers when he went to Switzerland and tried to buy some St Gaudens. After a bit, the banker gave him a price per coin, but said, "this price is only good for the first 300,000 coins, after that we would have to talk further".

In reality, most pre-33 gold that survives did so because they were not in the US at the time.