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Metals Market Report Weekly Archive
 

The Mike Fuljenz Metals Market Report

May 2018 - Week 2 Edition

Coin-Buying Billionaires Competing for “Best of Breed” Coin Sets

An old adage is that coin collecting is “The Hobby of Kings,” since only kings could afford (or have the power to seize) the top quality of rare coins made of precious metals. Today, that slogan has changed to become “The Collector is King,” with the serious collector of rare coins driving the up price of coins.

In modern times, celebrities such as Wayne Gretzky, Buddy Ebsen, Penny Marshall and Jerry Buss have collected rare coins, but wealthy collectors like the American financier Louis Eliasberg (1896-1976) have set the standard for a lifetime devoted to serious collecting of the best-known specimens of U.S. coins.

With the rapid growth of global wealth since the end of the Cold War, the annual Forbes census of global billionaires has grown from 140 in 1987 to 2,208 at latest count.  Out of 2,208 billionaires, it stands to reason that at least 1% of them would become fascinated by “The Hobby of Kings,” and so it has come to my attention that four billionaires are currently competing for high-quality rare coins in the coin market.

These very rich business owners didn’t get to where they are by being passive. They are well-informed, highly competitive goal-oriented collector-investors. I have been told at least two of them are trying to do what Eliasberg did and build complete sets of every coin from the US mint in as high a grade as possible.

This competition for high-end coins will fuel a resurgence in demand for all coins that trade from about $25,000 and up. Besides these few billionaires bidding for “best of breed” coins, other high-end collectors are building registry sets with either PCGS or NGC coins for “top-of-pop” (top of the population) coins.  Keep in mind, there should be a later trickle-down effect increasing demand and prices on coins below $25,000 due to these factors.

Other Billionaires are Buying Gold Bullion (and Rare Coins Later?)

Gold is up 1.5% through May 4, while the Dow stocks are down 1.85%, so gold is still beating stocks in 2018, and many stock market investors are getting nervous as the historically “best” month of April was flat and the historically worst six months for stocks (May to October) are just beginning.

With the stock market flat and in danger of collapsing below its key 200-day moving average, and with interest rates rising (and bond prices falling), and currencies in flux, international billionaires are looking to the time-tested value of gold for wealth preservation and capital gains. Last week, Naguib Sawiris, the second richest man in Egypt (the richest is his brother), the chairman of Orascom Telecom Media and Technology Holding S.A.E, told Bloomberg that he sees gold heading for $1,800 while the “overvalued” stock market will likely collapse.  Sawiris said he is putting half of his $5.7 billion net worth into gold.

That’s one man buying 68 metric tons of gold – a one-man Egyptian central bank! Sawiris made his fortune in the telecom sector, but now he looks at a world full of crisis and says people “tend to go to gold during crises and we are full of crises right now.  Look at the Middle East and the rest of the world.”

Other billionaire investors are concerned about the market and are moving to gold. Jeffrey Gundlach, founder of DoubleLine Capital, sees the “explosive, potential energy” of a massively bullish $1,000 gain for gold, to the $2,300 region, based on a technical base-building platform. “Gold is maintaining an upward pattern above its rising 200-day moving average, which is extremely good,” said the guru nicknamed the “Bond King.” “I’m not predicting it… I’m letting the market prove itself,” Gundlach said.

SS Central America Sales News

Sales of SS Central America shipwreck gold coins, bars and gold dust are moving briskly. Over two-thirds of the gold coins from SS Central America have been sold.  Please don’t delay buying these historic products as I expect them to be “lost” again soon.

There was extensive positive media coverage of my appearance with SS Central America chief scientist Bob Evans at the Dallas NRA convention last weekend. A record 87,154 people attended the convention and I feel like I talked about the treasure to most of them.

We Support NRA’s Eddie Eagle GunSafe® Program

The NRA’s Eddie Eagle GunSafe® Program, which we sponsor, has achieved another milestone by reaching its 30 millionth child.

More than 26,000 educators, law enforcement agencies, and civic organizations have taught the program since 1988.  We have sponsored their educational DVD in English and Spanish.  According to the National Center for Health Statistics, accidental firearm-related deaths among children in Eddie Eagle’s targeted pre-K through fourth grade have declined more than 80% since the program’s launch.  Law enforcement’s partnership with Eddie Eagle has proved to be very effective.  In fact, over 400 Eddie Eagle mascot costumes are in use by law enforcement officers across the country.  Our local Beaumont Police Department often uses the popular mascot costume we donated to them at local events.

The Eddie Eagle GunSafe® Program was created in consultation with elementary school teachers, law enforcement officers and child psychologists.  This is another important NRA gun safety program that is often under-reported when the media covers the NRA, like at the recent NRA Annual Meetings in Dallas.

 

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