Why Pre-1933 Gold And Silver Coins Have Outperformed Modern Bullions

If you weren't aware of this, there are two different segments to gold and silver

coins - those that were made before 1933 and those that were made after 1933. Why is this significant? Well, any of the pre-1933 gold and silver coins that you might encounter are going to be rare coins. They have been labeled this because they were not produced much and they in turn hold more value than their modern predecessors. Their rarity isn't the only thing that makes these coins more valuable though. In fact, there are several factors that have gone into the performance levels of the bullion versus the rare coin. Let's take a look at just a few.

One of the biggest reasons that pre-1933 gold and silver coins have outperformed the modern bullion is because they are numismatic coins. This is just a fancy way to say they are valued by the content of their metal, not their face or production value. Although the worth of precious metals does have a tendency to fluctuate, it usually remains on a steady incline. Thus coins that are looked at in terms of their content are better suited for investments than those that are backed by monetary value because money can decline at any time. We've seen that in our recently downtrodden economy.

Another reason that pre-1933 gold and silver coins have fared well is because they are considered to be private coins. That means that the government has no claim over them once they are released to someone else. The modern bullion is subject to gold confiscation, meaning that at any time, the government could reclaim the coins and not compensate for them. There is a sense of security to be found in rare coins that is unmatched by those of the present day, so people choose to invest in the older coins.

In the end, the differences in performance may just come down to production. Millions and millions of gold and silver bullions are produced nowadays, almost to the point that they should be circulated like dollar bills or quarters. While they may seem like a tempting buy because they will be theoretically worth something in the future, the fact is that there are simply too many of them. When you go to buy gold or buy silver, you want something that is going to be a bit unusual because that is the only way it will hold its value. Pre-1933 gold and silver coins do just that.

by: Troy Truman

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