The Coin Analyst: America the Beautiful Five-Ounce Series Still Has Legs
By Louis Golino for CoinWeek
It’s been an interesting year for collectors of the five-ounce silver America the Beautiful (ATB) coin series.
The bullion versions, which were hard to obtain when the 2010 coins were released, are now readily available, and relatively few people seem interested in them, although bullion sales did pick up a little in October.
Premiums have dropped to the point that they not only cost less per ounce of silver than American Silver Eagles (ASE). They actually cost about the same as silver bars of the same size. Low spot prices have squeezed silver supplies and increased premiums on silver bars, which are harder to obtain now than when silver was much higher earlier this year.
As for the numismatic versions, the coins have gone from being one of the most anticipated Mint releases of the year to a series whose future may be in doubt, as sales continue to slow. Only the bullion coins are required by law to be minted.
Even the recent $50 drop in price has so far not helped sales of the first 2011 numismatic version, the Gettysburg coin, which is somewhat surprising since these coins are not likely to be cheaper in the future. They are a good deal at the current Mint price of $230 since at current silver levels, the bullion ones run about $205 or more on average.
Graded examples have sold below the Mint’s price, but my understanding is that was for coins graded SP-68, which is a relatively low grade for the numismatic versions, the vast majority of which grade SP-69 or 70. Lesser quality coins always sell at a discount.
Silver analysts are almost unanimous in their view that spot prices will be higher later this year, and especially next year and beyond. Many factors are likely to help drive silver higher from tight supplies to improving economic data, which increases the industrial demand for silver, and higher gold prices, which make silver an attractive alternative to those who have trouble affording gold at current levels.
Sales of the Glacier Park coin, which was released on October 25, may have been negatively affected by the release of the 25th anniversary silver eagle set two days later, but those sets were gone in the blink of an eye, so that should not have a sustained impact on sales of the Glacier coin.
If silver makes a run towards $40 and higher soon, which is quite possible, that should help spur sales of the numismatic ATB’s, as collectors rush to buy before spot prices go even higher.
Another factor that may help support interest in the ATB series as a whole is future designs that are substantially different from the coins released in the past two years. If the 2012 coins are a good indicator, collectors may be pleasantly surprised in this regard, as three of the four forthcoming ATB releases have eye-catching designs that are not like anything we have seen yet. This could spur sales of both the bullion and numismatic releases for 2012, especially if the Mint expands its advertising to outside the coin world.
Comparisons are sometimes made between the numismatic ATB series and the first spouse gold program, such as in this recent Doomberg blog post (http://doomberg1.blogspot.com/2011/10/atb-squeeze.html). The main point is that sales of coins in both series have declined as collectors’ interest in them has declined, but the two series are really quite different.
First, the numismatic ATB coins are only in their second year, whereas the first spouse program is half over. Second, there is a big difference in cost between a five-ounce silver coin and a half-ounce gold coin. Finally, decreasing interest in a series does not necessarily mean it is destined to be ended early.
I can not think of any Mint coin programs that have been ended early other than the fractional burnished American gold eagle series, and the Mint never stated it would be an ongoing series anyway. First spouse sales have been slow since 2008, but the coins are still being issued. Besides, the 2011 ATB numismatic coins can be sold in 2012, and who knows what will happen next year, especially if silver resumes its bull run.
When it comes to predicting how the market for these coins will develop over time, I think that many people may be looking at the future of this series the wrong way.
The conventional wisdom is that declining sales numbers and decreasing interest in the series mean that there is little demand for the coins, and therefore collectors are better off putting their funds into other series and coins.
But within the realm of silver products offered by the Mint, the ATB coins may actually be among the ones with the best long-term potential if lower sales translate into low final mintages, as has happened with the gold spouses.
Most commemorative issues decline to close to their bullion values before long, and proof and burnished silver eagles may do well, but that will largely be a function of where silver goes.
On the other hand, the numismatic ATB coins, precisely because they are less popular today, could be winners down the road apart from their silver value.
This is what has happened in the past with many Mint offerings. Coins which are popular when released and which sell out fast but which lack a broad, established collector base, like the 2007 first spouse gold coins, later decline to their bullion value because they are readily available in the secondary market, even with all the melting of the 2007 spouse coins.
But coins which few people bought when they were released, such as the uncirculated 1996 Olympic coins, which contain the keys to the silver commemorative dollar series, or the uncirculated 2000 Library of Congress bi-metallic coin, today command big premiums. There are plenty of other examples.
There is, of course, no guarantee that things will play out this way with the ATB series, and the 35,000 mintage is indeed too high and should probably be reduced to around 25,000 for the 2012 releases and beyond. In addition, I agree with the author of Doomberg that the Mint needs to do a better job of spacing out the release of these coins.
But remember that just because 35,000 were minted does not mean they will all be sold, and 5 years or more from now, some issues could be scarce coins that command nice premiums.
Finally, when it comes to modern Mint products, it is highly advisable to collect what you enjoy rather than trying to predict future values, which is a risky game.
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 Coin Week, “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.