By Louis Golino for CoinWeek ………
As the 30th anniversary of both the silver and gold American Eagle Coins in 2016 approaches, it may be helpful to review the numismatic component of the eagle program and try to draw some lessons from this experience for the future.
The collectible versions of both coins have witnessed some interesting changes over the years that have helped make the numismatic eagle programs so successful. From the beginning proof versions of both coins have been offered, though clearly the proof silver eagles have been more popular than their gold counterparts as seen in the much higher sales for the silver coins.
The marketplace for the proof versions has changed a lot over the years. The silver proofs not too long ago were divided into common dates and lower mintage years that commanded substantial premiums, but in recent years the large premiums on most of the silver proofs have disappeared, or come down dramatically. At the same time, when silver hit $50 in 2011, every coin in the series was trading on the wholesale market for about $100, which is a nice return for those who bought the earlier issues at an issue price that used to be about $25.
The gold proofs are a different animal. They sell at a fairly substantial premium over melt value, or compared to their bullion counterparts, if purchased from the Mint. But on the wholesale market, the one that matters even if you are not a dealer when you try to sell your coins, they trade as bullion at a very small, sometimes at no premium to their gold content. In recent years sales of the gold proofs have declined sharply, probably due to higher spot prices, and the new game is waiting for lower lows in mintages each year. Right now the 2012 coins have the largest number of low mintages and they have some retail premium, but the market is waiting for the 2013 mintages.
In 2006, on the twentieth anniversary of the program, the Mint started issuing special uncirculated versions of American Eagle Coins struck on burnished planchets at the West Point Mint with a “W” on the coins. Some people are not fans of the burnished coins, saying they are too hard to distinguish from the bullion versions apart from the mintmark. Sales have been uneven, and the market for these coins is still being established, but the silver coins are an especially nice addition for collectors because of their high quality, and they are actually quite distinguishable from their bullion counterparts because of their more matte finish.
For the burnished silver coins, the 2006 release, like many first coins in a new series was the subject of a lot of interest and enthusiasm when it first came out, and rose quickly from a $20 issue price to as high as $100 before settling back to its current level of about $70. In the years since then mintages have largely been successively lower from one year to the next with the current low being the 2012-W, which at the moment commands only a small premium over issue price unless graded MS70, although that is partly because silver spot is lower now than when the coin was first released.
The burnished gold series, which also began in 2006, has seen more excitement and higher premiums than its silver counterpart. The 2006-2008 coins, especially the fractional one-tenth, one-quarter, and half ounce coins all command strong premiums, especially all the 2008 coins plus the 2007 half and quarter ounce pieces, but the market is currently a lot weaker for these coins than it was a couple of years ago. Most of these issues currently sell retail for about what they were trading at on the dealer market not long ago. They are probably sleepers, but sleepers can take a long time to wake up.
The one ounce burnished gold eagle series saw a lot of excitement over the 2011-W coin because of its very low mintage, only to see last year’s coin come in substantially lower and quickly develop a huge premium. Now collectors are waiting to see the numbers on the 2013 coin, which are running even lower so far. In this kind of environment, meaning a trend of lower lows each year, it is hard for the value of these coins to be established.
A more significant change to the numismatic American Eagle Coins program also emerged in 2006, namely, the introduction of silver and gold reverse proof coins with the silver issue debuting in the 20th anniversary three-coin set that remains in demand to this day because it was the first of its kind. While the gold version was only issued in 2006, as part of a different three-coin anniversary set with a mintage of 10,000, the silver coin was also issued in reverse proof for the 2011 25th anniversary set and the 2012 and 2013 two-coin sets for the San Francisco and West Point Mints.
This year, as part of the West Point set, the Mint also launched a new type of silver eagle, the enhanced uncirculated coin, which has been a hit with collectors, but not as successful so far on the secondary market because the coin was issued to demand.
The "issue to demand" approach was instituted largely because of the problems so many collectors encountered in 2011 when trying to purchase the 25th anniversary set, which contrary to what one prominent numismatic writer says in his article in the October issue of Coinage magazine (“’Creative Marketing’ Gone Wild”) where he writes that sales were “sluggish” and “the 100,000-set sales limit was eventually released,” in reality sold out in less than five hours even with the constant web site problems everyone encountered.
So the following two years the Mint "issued to demand" but in both cases there were extensive shipping delays. The delays soured many buyers and led many to cancel their orders. In fact, there are rumors that the 2013 set is going to come in with a much lower final sales number than the 281,310 the Mint released on the last day of sales because it has several times briefly posted a lower number on its web site, only to remove it soon after.
Issue to demand has its merits, but the Mint will lose the interest of many collectors if it no longer issues special sets for loyal American Eagle Coin collectors that have limited mintages, which are more desirable and have a greater chance of increasing in value. It simply needs to move forward with its planned web site improvements, as it recently announced it is doing starting with the waiting room innovation that will hopefully alleviate some of the problems. The Mint also needs to be better prepared for an early rush of orders whether or not a coin or set is going to be available for an extended period.
Finally, the use of special finishes on numismatic eagles can at a certain point be overdone, and the same is true of special sets. The enhanced uncirculated approach would be a nice addition to proof sets and commemorative proof coins, but should not be used again on silver eagles. The Mint has already indicated it realizes it is time for a break on special eagle sets, which is encouraging.
For the 30th anniversary, as I have suggested several times before, the Mint should issue a special high relief version of the silver and gold eagles, and then it should move forward with the recommendation of the CCAC to change the design of at least the silver eagle and possibly the gold coin too.** Both currently sport extraordinarily beautiful designs that are based on favorite collector classics, but after 30 years, it is time for a change as long as the new designs are as powerful and attractive as the old ones. Some people will be resistant to such a major change, but if the American Eagle Coin designs are good enough, they will come to accept and embrace them. Such a move could really help breathe new life into the numismatic eagle program and help sustain it for decades to come.
**The CCAC has only recommended changing the silver eagle design, but in my view it would be worth at least considering changing both coins' designs.
Louis Golino is a coin collector and numismatic writer, whose articles on coins have appeared in Coin World, Numismatic News, and a number of different coin web sites. His column for CoinWeek, “The Coin Analyst,” covers U.S. and world coins and precious metals. He collects U.S. and European coins and is a member of the ANA, PCGS, NGC, and CAC. He has also worked for the U.S. Library of Congress and has been a syndicated columnist and news analyst on international affairs for a wide variety of newspapers and web sites.