It Works Both Ways
January 28, 2008
With rapidly rising bullion prices, coin collectors have gotten used to the U.S. Mint taking gold and platinum coins off the market for a time, raising prices and then putting them back on the market.
Some collectors have groused whether the process works both ways. If bullion goes down, will the price the Mint charges for coins of precious metals go down also?
The answer is yes. In the most recent statement made by the Mint on Friday to announce that it was taking proof platinum Eagles off the market, the question was answered.
Platinum jumped $67.10 per ounce to $1,680.10 on Friday after production was shut down in South Africa's major mines due to an electricity shortage in the country.
The Mint responded to the price rise. In the boilerplate announcement, the final bulleted item says, "Significant drops in the price of platinum will likewise result in a lowering of prices."
I don't know when that concept will be tested. The markets seem to be of a mind to keep going higher. However, some collectors who don't like the idea of rising prices will have to figure out a new way to grouse about it.
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