August 2023 - Week 3 Edition

Investors Favor Gold Over Stocks in the 2023 Gallup Poll

The Wall Street Journal covered the annual Gallup Poll of American investors’ favorite asset categories on Tuesday, August 8, in an article entitled “Individual Investors Seek Safety of Gold.”  It began by profiling a young (age 44) Massachusetts engineer frustrated with the vacillating values of tech stocks, who said, “Precious metals … makes it so I can sleep at night, where I hold it and nobody can hurt me,” adding “It’s impossible that I’m going to end up in a bread line somewhere, waiting for someone to drop something in my hand so I can eat.” His sentiment is reflected in the fact that the 2023 Gallup Poll found 26% of Americans polled (in May) believe that Gold is the #2 long-term investment, behind only real estate. Stocks dropped from 24% (#2) in 2022 to 18% this year (#3).

Gallup’s Question: “Which of the following do you think is the best long-term investment?”

(Real estate was #1 each year, but gold has risen from #4 to #2 in the past four years)

Gold is down lately but even since the start of 2023, half are up slightly more than the Dow, and since last September 30, gold is up 16.4% vs. just 7.8% for the Dow. Although the S&P 500 and NASDAQ gained more than gold, they have been more volatile and their gains have been dominated by seven mega-cap tech stocks like Apple, Google and the like, profiting from the latest “AI” technology investing fad.

Although U.S. Mint bullion coin sales have been flat lately, the Wall Stret Journal points out that the U.S. Mint has sold 5.56 million Troy ounces of gold coins since the pandemic began in March 2020 (less than 3.5 years) compared with 3.26 million ounces sold in the four-year period before that, a doubling in monthly sales.

From our experience, we know that U.S. Mint bullion coins are often the starting point for gold investors. Many bought their first gold coins during the banking crisis in March 2023, pushing gold up from $1,816 the day before the first major bank failure to $2,000 or more in early April. Our experience has shown that about 10%-20% of those gold bullion investors graduate to invest in rare coins within 18-24 months,

Today, around 20% of U.S. investors currently hold gold in their portfolios, with the average allocation being 14% in precious metals, according a SPDR survey released in June 2023. More than half of those surveyed said they are likely to increase their allocation in the next six months, according to the Journal, so millions of Americans are now ripe for graduating from gold bullion to the rare coin market. I advise you during these uncertain times to routinely add gold to your portfolio. Contact our professional account specialists to help you today.

Honored to Receive Four Major ANA Awards During 2023 “World’s Fair of Money”

During the American Numismatic Association (ANA) annual banquet, held on August 11, 2023, at the World's Fair of Money in Pittsburgh, Pa., I was honored to receive the ANA’s “Chester L. Krause Memorial Distinguished Service Award,” the organization’s highest award. It is given “in recognition of outstanding service to the American Numismatic Association and numismatics.”

The ANA Distinguished Service Award has been awarded since 1951 (previously under the name: Farran Zerbe Memorial Award). The criteria for the honoree are that the individual is considered someone who has rendered numerous years of outstanding service to the ANA, as well as the overall field of numismatics. An additional qualification is that the honoree should be a former Medal of Merit and Glenn Smedley Memorial Award recipient.

In the same ceremony, Dr. Ralph Ross, the ANA president, presented me with the American Numismatic Association Philanthropy Award, which states, "Thank you for your Support of the ANA and the Hobby Community."

(Left) Mike receives the Chester L. Krause Memorial Distinguished Service Award from Dr. Ralph W. Ross, ANA President. (Right) Mike receives one of his two NLG awards from Patrick Ian Perez, Executive Director, Numismatic Literary Guild

Earlier, during the Numismatic Literary Guild Awards Luncheon on Thursday, August 10, 2023, I received two Literary Guild awards, one for the “Best Book” on Numismatic Investments for my “Type Three Double Eagles 1877-1907, 3rd Edition,” and another award for “Best Column or Article, Numismatic Marketplace News and Analysis,” which you read in these weekly Market Reports. When choosing a dealer or buying online, make sure to verify the dealer is respected by their peers and has been honored for their commitment to numismatics like we are.

U.S. Dollar Index Up 4% in July

Gold traded at a 7-week low on Monday, August 14, primarily due to a rising dollar and higher bond yields. The U.S. Dollar Index is up 4% in the past month, from 99.77 on July 13 to 103.1 on August 14. Market pundits tell us that gold investors are selling gold in advance of the Federal Reserve’s July FOMC meeting, which they say could “signal whether the Federal Reserve is planning to pause its series of interest rate hikes to combat inflation.” However, July is totally irrelevant since the Federal Reserve bases its future decisions on economic indicators released in August and September, not July.

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