US Mint Suspends Sale Of Gold Coins

WASHINGTON — The U.S. Mint is temporarily halting sales of its popular American Buffalo 24-karat gold coins because it can't keep up with soaring demand as investors seek the safety of gold amid economic turbulence.

Mint spokesman Michael White said Friday that the sales were being suspended because demand for the coins, which were first introduced in 2006, has exceeded supply and the Mint's inventory of the coins has been depleted.

The Mint had to temporarily suspend sales of its American Eagle one-ounce gold coins on Aug. 15 and then later that month announced sales of the American Eagle coins would resume under an allocation program to designated dealers.

White said the Mint expected to soon start distributing available Buffalo gold coins through a similar allocation program.

Through Thursday, the day the Mint suspended sales of the American Buffalo, the Mint had sold 164,000 of the coins this year, up 54 percent from the same period a year ago.

"People are scared. Gold has become a safe haven," said Michael Maroney, a vice president of sales at gold dealer Monex Precious Metals in Newport Beach, Calif.

Maroney said that demand for the one-ounce American Eagle coins was "through the roof." He said Monex still had American Buffalos available Friday because the company had recently stocked up on them.

With the financial crisis gripping markets in recent weeks, investors have rushed to safe havens such as gold and Treasury securities. Demand for three-month Treasury bills last week pushed their yields down sharply to levels not seen in decades.

Investment advisers, however, caution that the volatility often seen in gold prices could make investments in this area more of a risky decision if gold prices suddenly begin to fall sharply.

As the financial crisis unfolded in the past few weeks, American Gold Exchange Inc. saw demand for coins go up about 50 percent, according to Bill Musgrave, a vice president of the Austin, Texas-based gold dealer.

The Mint introduced the American Buffalo gold coin, the country's first 24-karat gold coin, in 2006. Congress authorized production of the coin in an effort to capture a portion of the global market for pure gold coins, competing with such coins as the Canadian Maple Leaf.

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Associated Press business writer Candice Choi contributed to this report.

Comments

[josephjsalas]

02:12 PM on 09/28/2008

How'bout we get the United Nations, who ownes the US Treasury and Federal Reserve, to back-up
our dollars with some of that 20,000 metric tons of gold they purchased for 30,000 $100,000
bills-ALL PRINTED OUT OF THIN AIR! And to boot. The UN/WB/IMF is also comprised of
mining and oil corporations. What say they back-up the bailout (buy-out) money with some
Cu,Fe,Petroleum,grain and so on? (EO 11110)

[leatherneck1971]

01:38 PM on 09/28/2008

Well guess I have given my two cents worth of nothing to the debate, since one cannot change a die hard republicans belief in their messiah, but the good book does say some in those last days will repent, and turn away from him......, maybe I opened a eye or two, if not, I have no guilt, since I saw these folks for what they were in 2000...., and never sold my soul to them!

[leatherneck1971]

01:34 PM on 09/28/2008

Enough of my gloating on what I have been seeing for years, now for a useful suggestion, I remember my grandfather telling me how he survived the 1st depression, on a home garden, a few chickens, hunting wild game, now for all you civilized folks in Peta, animal rights organizations, sorry, but I can bet starvation will make you loose your civilized values in about 3 weeks which is limit of most people to go without food, and if anyone wants to know chaos just look what happened in gas shortage in south east, it was a dog eat dog world and sadly many will not see the writing on the wall till it is to late, chaos is a word meant to describe something, imagine a country in chaos, double digit unemployment, a government unable to control crowds/mobs of angry citizens, one only has to look back to france to see what happened to those blamed for citizens suffering, I for one would not go around with a "vote for Bush/Cheney sticker on my vehicle" or brag I am a republican, one might find themselves facing a angry starving lynch mob, looking to blame someone...!

[leatherneck1971]

01:19 PM on 09/28/2008

Problem with exchanging US dollars for gold, gems today is "who in their right mind" would take a american dollar in crisis for a gold coin, bar, gem stone? I venture to bet the rich elite who saw this coming did it long ago, and will ride out this crisis, or immigrate to a new nation they can pillage and lead to ruin, history is full of this! I hate to bust anyones bubble, but if you do not already have gold, gems, it is unlikely anyone is going to give you some for US dollars, even the US government stopped and can see the writing on the wall! Again its deja vu for the ones to see it, and for the blind whom love their messiah George{6}Walker{6}Bushjr{6} I think you know your predicted fate in the end! I saw him as a scoundrel in 2000, 2004, did not vote for him by taking his mark on my hand in that voting booth, nor have I ever worshiped him in my forehead/mind by joining his fan club the republican party!

[leatherneck1971]

01:12 PM on 09/28/2008

All one has to do is look at what happened in other countries which experienced their currency devaluation on international markets, Brazil as one example the government issued a new currency, demanding all citizens turn in old currency at a 10 old for 1 new one rate, so drawing it out and hiding it in a jar is useless, wasted energy, if left in a bank it automatically goes to the new rate, imagine that $1,000,000.00 in 10 separate accounts you think is safe, or the $100,000.00 in a FDIC account you feel is safe, and all of sudden your government says you get 10 old dollars for one new one? That millionare is now worth $100,000.00, that person with $100,000.00 now has a mere $10,000.00, one can see why hard currency is in demand in economic crisis, government cannot devalue gold, gems, things considered hard currency! They can demand you turn in all your gold as our government once did, with gold coins...., many did and many did not! If anyone thinks this bail out is for main streets benefit, I got some swamp/desert land I will sell you! We are on verge of 2nd great depression and the geniuses in white house whom got us here are not fit to get us out of it! Herbert Hoover famous republican credited for 1st depression, not surprising Bush and party of rich for the rich has lead us to a deja vu moment!

[4casme]

12:18 PM on 09/28/2008

Buy gold and wait for price to go up then sell. Pay off all debts then get out of dodge with your remaining precious metals.

[funkalicious]

11:34 AM on 09/28/2008

Gold is a manipulated market prices drop as supply tightens
And here are the total returns during the past 8 years:

HUI.....................UP +604%
Gold....................UP +225%
DOW.....................UP +5%
Real Estate ($HGX)....DOWN -3%
S&P500................DOWN -15%
US Dollar.............DOWN -32%

[wadenelson1]

10:52 AM on 09/28/2008

Imagine if Ford Motor Company worked this way.

"Hey Harry, sales of the Explorer are through the roof!"

"Well, we'd better suspend sales then!"

The US Government doesnt' want to let go of it's remaining gold when it knows damn well it's going to be
worth 10X as much in two years.

[ShakeYourComplacency]

12:22 PM on 09/28/2008

That makes sense to me. They're holding onto the gold. Anyway, I think gold is going to be a profitable market because number one, the economy is still tanking, and number two the other two markets - stock market and real estate market have busted. Remember how the train of investing went....the stock market first, with people making a killing overnight, then when the stock market crashed a while back, the investors turned to real estate. Now that the real estate market has bust, they're turning to whatever's left, which is gold. Gold will certainly be played out eventually, but for the next year Gold will be a safe bet.

[monkeymuggs]

10:11 AM on 09/28/2008

Its actually a good sign for people smart enough to really (really) listen to Ron Paul.
Your not making money but hedging against inflation. If you spent 10 grand on as much Gold Bullion as you could buy 7 years ago, it would cost you a hell of a lot more than 10 grand to buy the same amount today.

[4casme]

12:13 PM on 09/28/2008

Buy gold and wait for price to go up then sell. Pay off all debts then get out of dodge with your remaining precious metals.

[messy]

08:57 AM on 09/28/2008

The coins are doing what they're supposed to do, act as bullion. They're supposed to be neumismatically worthless, however prior to this most of the gold coins went to collectors.

[wutzhappn]

11:50 AM on 09/28/2008

Thank God Obama has his own minted gold coins with his profile on them. They will act as bullion too.

[OutsiderSA]

08:55 AM on 09/28/2008

South African Coins
Krugerrands, Mandela Coins, Rare ZAR, Free coin valuations.
:http://www.sacoin.co.za

Sure these guys will exchange paper for gold

[xrepublican]

02:27 AM on 09/28/2008

I'd hold onto them.... Adding a few trillion more to the national debt is not going to help the value of the dollar any....... which is precisely why people are buying - they have visions of Wemiar Republic inflation in the future.........

at he momjent the US $ is backed by.... the PROMISE of the US government to pay - in dollars. Not gold, not silver or any other precious metan in some fixed or even variable price.... but NOTHING. It's an IOU - a marker from a proven credit risk who has run up a tab that shows no sign of decreasing... only going up further.

[StarkRavingNakedEmperor]

02:54 AM on 09/28/2008

So true! And truly frightening. Our paper money is backed by nothing and is worthless. Can trips to the Super with wheelbarrows full of it for a loaf of bread be far behind? I checked out my local coin stores and precious metal dealers Friday--with the recent bank failures people have taken money out and pretty much cleaned those shops out--along with Smith & Wesson!

[NoMoFearNoMoHate]

10:48 AM on 09/28/2008

It's backed by the American people. Our creativity and production. When those things fail then America fails - then what is there to worry about?

[Coinyer101]

01:25 AM on 09/28/2008

i dont want to sell my coins, but, if prices get any higher i may have to.

[NoMoFearNoMoHate]

10:48 AM on 09/28/2008

And when many like you do then the price will fall as the market floods... just the way it works - BETTER HURRY!