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Kennedy Gold Coin Becomes a Numismatic Disaster

On August 5, 2014 at 12pm Noon EST, the U.S. Mint began to sell a Kennedy .999 Gold Half Dollar to commemorate the 50th Anniversary of the 1964 John F. Kennedy Half Dollar. Prior to this August 5th offering, the U.S. Mint had manufactured 40,000 coins. Their plan was to sell these ¾ ounce gold coins to the public for $1,240 per coin at the Chicago ANA convention, as well as in Philadelphia, Washington D.C, Denver and on the Mint’s website. At these four locations, the U.S. Mint offered one coin per buyer, give immediate delivery, and had planned to sell only 500 gold coins in five consecutive days. On their website the Mint offered up to five coins per family with no guaranteed delivery date specified.

What Happened?

I was staying at the Rosemont Hilton during this five day period, (this hotel is located directly across the street from the Stephen’s Convention Center), where the American Numismatic Association (ANA) was holding its numismatic convention. The morning of August 5, I was able to see the buyer’s line (which began forming at 2am) with over 800 people already in line. Many of the buyers in this line were bused in by large retail dealers who had been offered up to $500 to stand in this line and buy the one coin. The line was then moved into the convention center at 9am and the Mint began to sell one coin to each customer beginning at 11am. 

PCGS and NGC were accepting the Kennedy gold coins on the convention floor and offering special First Day of Issue, First Strike or Early Release labels. Employees of many coin dealers were standing near the end of the line and offering the buyers, as they left the U.S. Mint’s booth, a nice profit of up to $1,500 over the original $1,240 issue price. The dealers would then immediately submit these coins to NGC or PCGS for certification. After receiving their coins back from PCGS and NGC, these dealers were then listing the coins for sale on their websites and on eBay, priced from $4,000 to $5,000 per coin. Dealers who were able to purchase quantities of these coins at the three other locations (Denver, Washington D.C. and Philadelphia) were also flying to Chicago to submit their Gold Kennedy coins to PCGS and NGC for the First Day of Issue, First Strike or Early Release label.

On the morning of Wednesday, August 6, the line began forming at midnight. By 9am, there were approximately 1,000 buyers waiting in line. I was awakened from my sleep at 2am as 6 police cars with loud sirens arrived at the convention center to help control the people in line.  I saw two men fighting in the middle of the street and watched the police arrest them and take them away.  There were some people in line that were asked to leave because of their vulgar language and behavior during registration. Many of these buyers had been hired by retail coin dealers to wait in line and bring the Kennedy Coin directly to them on the floor of the convention center. 

At 9am Wednesday morning, the line started to move into the convention center onto the bourse floor and to the U.S. Mint’s booth. Dealers were again waiting near the U.S. Mint’s cash registers offering to buy Second Day of Issue coins so they could submit them to PCGS and NGC for the First Strike or Early Release label.

The third day, Thursday, August 7, another 1,000 person line had formed. However, the U.S. Mint cancelled their sale and turned all the potential buyers away. The U.S. Mint said, “The United States Mint and the American Numismatic Association (ANA) announced today that sales of the 2014 50th Anniversary Kennedy Half-Dollar Gold Proof Coin have been suspended at the ANA's World's Fair of Money in Rosemont, Ill.  The Mint and the ANA made the decision to ensure the safety of those wanting to purchase the coin and the safety of their own employees.” The United States Mint also announced that it has all the necessary raw materials to initially produce 75,000 2014 50th Anniversary Kennedy Half-Dollar Gold Proof Coins by October 1, 2014. They will also continue to procure additional raw materials in order to fulfill all the demand for this product. The U.S. Mint will produce 6,000 coins per week until the demand is filled.

Why did I say the Kennedy Gold Coin became a Numismatic Disaster?

I feel that it would not be prudent to purchase the PCGS or NGC certified Proof-69 or Proof-70 Cameo First Strike or Early Release Gold Kennedy Commemorative Half Dollars at the current asking price. I also believe that the price will be lower by the end of the year for four good reasons.

  1. The Kennedy Gold Half Dollar is not a series of coins that numismatists are collecting. This is a one-time only anniversary issue and will not be minted again in 2015.
  2. This Kennedy gold coin only contains ¾ of an ounce of .999 fine gold -- an off weight and not popular with collectors.
  3. The mintage is unlimited. The U.S. Mint could produce over 100,000 coins, which is very high for a gold commemorative coin.
  4. You are not buying or investing in a rare coin; you are paying a very large premium for a label that has little to no chance of becoming part of a registry collection by PCGS or NGC.

If you remember John F. Kennedy and you want to own one of these commemorative gold coins, please visit the U.S. Mint website (www.usmint.gov) and purchase one for $1,240 and keep it as a collectible, not an investment. However, if you want to purchase a PCGS or NGC certified 2014 Kennedy gold coin in Proof-69 or Proof-70 grade, we will be offering them for sale at about half the current asking price in a few weeks to a month. Or, if you have $4,000 and are interested in owning a 2014 Gold Proof-70 Ultra Cameo U.S. coin, think about the following options at half the price containing a full ounce of gold:

2014 1oz .999 U.S. Gold Proof-70 Cameo Buffalo (First Strike or Early Release)
2014 1oz .900 U.S. Gold Proof-70 Cameo Eagle (First Strike or Early Release)

By Barry Stuppler

Founder and President
MintStateGold.com
barry@stuppler.com

 


Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in precious metal products, commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.
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