Tags: Fiscal Cliff | gold | coins | soar

Financial Times: Sales of Gold Coins Soar

Wednesday, 12 Dec 2012 07:58 AM

By Michael Kling

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As the country gets closer to falling off the fiscal cliff, sales of U.S. gold coins have already shot up in a rocket.

Sales of American Eagle gold coins soared 131 percent in November, rising sharply after the election, according to the Financial Times.

The reason: Fear and disenchantment with Washington. The coin buyers see more gridlock in Washington as the fiscal cliff approaches and more quantitative easing from the Federal Reserve.

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"You've got a lot of people who are very worried about the economy. With the election they saw that nothing was going to change," Terry Hanlon of bullion dealer Dillon Gage told the Times.

Sales at Dillon Gage in November were 32 percent higher than were sales in October, said Hanlon.

In addition, dealers are stocking up on gold coins before the end of the year when the U.S. Mint stops producing 2012 coins and starts next year's coins, according to the Times.

Although large institutional players have backed away from gold in recent weeks, causing the metal's price to falter, gold coin sales are dominated by retail buyers.

The Royal Canadian Mint, the Times notes, also reported a jump in sales of its Maple Leaf gold coins.

"The fiscal cliff is causing a huge stir in investment markets, and this is precisely why gold coin sales skyrocketed in November," says Arthur McGuire, vice president of precious-metal dealer Gold Coin.

"Many wise investors know that no matter what the fiscal cliff resolution is, the U.S. economy is still in a deep financial hole, and this is good for gold."

Gold has already increased over 600 percent since 2001, reflecting 12 years of consecutive price gains, McGuire notes. Analysts at Gold Coin predict that gold coin sales will continue to increase as more investors invest in gold as a safe haven, pushing gold coin prices to over $2,000 per ounce in 2013.

Editor's Note: Get David Skarica's Gold Stock Adviser — Click Here Now!

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