More Precious Metal Questions & Answers

1. I have read through your website and can't find anything on appraisals. What is your company policy?
   Answer:   Our policy on appraising your collection is simple and we guarantee your complete satisfaction. Call Ken Slater toll free (1-800-225-7531) and explain what you are trying to accomplish. Some folks can get a pricing answer right over the phone as Ken has been doing this for more than 20 years. If your intention is to sell your collection it may be necessary to send us the collection using registered and insured US mail. Either way Ken will explain value and procedure to make sure the collection is mailed securely making further evaluation easier. When we sign for your package, inventory control will check contents against your packing slip and notify you of its arrival. Ken will look up and grade each numismatic coin and make a note as to what we will pay for that particular item. He will do this for every numismatic coin in the collection and then add the value of any bullion product relative to the closing price the day of arrival. He will then call you with a total and answer any questions you may have including an explanation of how he arrived at the valuation. After you have all this information the decision to sell is up to you and the family. For the record we pay high prices because we do have needs for virtually everything. In 95% of all cases the customer is more than happy with our offer as we spend millions of dollars each year purchasing collections from all over the United States. But what happens if you don't like our buying prices? That is no problem, we are here to make you happy so we will simply repackage your collection and mail it back to you. We use registered and insured mail and include a check refunding your original mailing costs. You really have nothing to lose and could get considerably more using our convenient system. If you already have an appraisal and what to know if your being treated fairly, ask Ken for his guaranteed 10% better bid. If he can't beat your best offer by 10% he will tell you and this will make your final decision easier. This is just another simple way to get a little more without placing you or your collection at risk.   
2. I'm thinking of borrowing money to buy gold, what do you think?
   Answer:   Borrowing money to invest is usually a bad idea. With the big increase in property lately some investors have even used home equity thinking the metals will soon rise and they want to profit from this move. We believe all hard assets will rise over time but no one really can define just how long this process will take. Because of this uncertainty you are better off to limit your investment to money you have on hand and wait for these markets forces to move in your favor.
3. The word numismatic is in your name, what exactly does it mean?
   Answer:   Numismatics is the study of coins and currency in their historical context. As it relates to CNI we focus on the coins and currency of the United States but the formal discipline actually encompasses a much larger area. It includes virtually anything that was used as money or a form of exchange. A numismatist is an individual who collects, invests, or studies rare coins or money related items that were used to transact business.
4. How do I sell to you and is the process complicated?
   Answer:   The process is as easy as buying. First, call and describe the product you wish to sell. It could be bullion coins or bars, certified coins, uncertified coins, banknotes, tokens, you name it. Second, we quote our buy price right over the phone. If you like the quote and want to proceed simply ask for a computer confirmation. Third, a vendor account is created in your name and you are given a purchase order number. At that point your quote is locked in and guaranteed. In other words we agree to abide by the quoted price no matter what the market direction while the transaction is being completed. If you are out of state securely wrap and insure the package in a timely manner. We recommend only the US mail. Be sure to include your inventory list, purchase order number, and daytime telephone number. Your money is sent within a day or two of receiving your package. If you have additional questions about selling or wrapping your material call Brent Galaway directly (800-225-7531). Also keep in mind that the US mail delivers millions of dollars worth of inventory to us each year. It is a safe and secure way of conducting business nationally.
5. Should I trade Krugerrands for other bullion coins like the American Eagle?
   Answer:   Trades like these really don't make sense because you are trading one type of bullion coin for another which is basically the same. Why pay the extra commissions?
6. What balance should I have between hard assets and my other investments?
   Answer:   Everyone should make their own decision on this but a recent study has indicated that perhaps 10% to 20% of your investment dollars should be in inflation-sensitive precious metals and certified rare coins. Financial planners suggest the rest of your money should be in traditional vehicles like stocks, bonds, real estate and T-Bills.
7. Should I trade my gold bullion coins for platinum bullion coins?
   Answer:   Actually the investor should have some of each in a balanced hard asset holding. Some investors, however, trade a portion of their gold bullion for platinum bullion if the price of platinum is close to the price of gold. This is done because historically platinum has been much more expensive than gold and will probably be again in the future.
8. I like silver bullion but it is a slow market. Should I sell and buy something else?
   Answer:   Silver has always been "hot" or "cold". There doesn't seem to be any middle ground. It can, however, explode in value so it makes sense to have some on hand.
9. What do you think about investing in better date gold coins?
   Answer:   Scarce and rare date coins should be a part of everyone's holdings. They tend to fall into two broad categories. The first are coins with relatively small PCGS populations which don't cost much more than a type coin of the same grade. Classic examples of these are better date $20 Liberty gold pieces in PCGS MS 63. This is an area in which investors can find coins which are 10 or 20 times as rare yet cost only a few hundred dollar more.
10. What do you think about investing in coin sets?
    Answer:   Investing in sets has always provided a powerful investment advantage for it keeps you focused. And learning to think about sets is easy. If you build a gold type set, a series or denomination set, or a date set you add additional rarity and desirability when it comes time to sell.
11. What do you think of storage programs?
    Answer:   It depends. Storing your precious metals or rare coins with the dealer who sold them to you is always a bad idea. The reason anyone owns hard assets is to have something tangible in your hands in case our currency system goes down the drain. Historically many people have lost money if the selling dealer goes broke. That being said some depository programs are used by the COMEX and CBOT. These independent and audited programs are used to make the storage of large silver positions a simple process. The program offered by Delaware Depository Service Company (www.DelawareDepository.com) is an example of a good program which is audited and insured.
12. What do you think about investing certified bullion coins?
    Answer:   This area has turned out to be very controversial. The notion of grading a bullion coin has never made any sense because they are all perfect. Why pay the additional fees and a premium based on grade if when you are ready to sell no dealer will return the favor? Another recent development is the so-called First Strike program. There is already litigation posed by a Florida collector who claims that the grading services can't use the term First Strike because they have no idea when the coins were actually struck. It is best, until this controversy is cleared up to avoid this area. There are many other great places to put your investment money.
13. I purchased coins at higher levels and am now losing money. What do you suggest?
    Answer:   First of all remember this investment will go up and down over time. The more time the better. But if you're tired of waiting or have some compelling reason to sell, like an offsetting gain, consider selling your coins and establishing a tax loss. This is done in the stock market all the time. You can repurchase your position in a month or two and still take advantage of the tax loss. Always check such things out with your tax man before making any decision.
14. I'm told that I may purchase old, circulated $10 and $20 gold pieces which sell for smaller premiums but will not be subject to confiscation should our government once again call in gold bullion. What do you think?
    Answer:   This strategy has been around for some time and it does make sense to those who want a coin which is bullion based but does not carry much of a premium. The difference between the buy and sell price for such circulated gold coins is larger than the difference between gold bullion coins but it is worth it to those wanting the added option.
15. I purchased rare coins twenty years ago. Should I send them to PCGS?
    Answer:   This is always a good idea given the quality of the coin is high enough. Obviously the value must be enough to justify the cost of certification and insurance. Don't certify a coin worth $30 because it could be easily sold "as-is".
    It is a good idea to certify even if you're not thinking of selling anytime soon. The reasoning is simple. When the coins are certified you won't have to wonder about what they are worth. Just pick up the phone and get a bid. This is not true if they are not certified.
16. The historical aspect of investing in U.S. Colonial coins is fascinating but I see very little about these early coins of America. Are they good investments?
    Answer:   Colonial coins are one of the most fascinating areas of numismatics and, to a select few, one of the most popular. And these coins are graded by PCGS just like other investment material. Some colonials have an almost legendary status. Like the Brasher Doubloon which is worth a fortune. Many of the most popular Colonials are very affordable. Like the famous Fugio (intended meaning was "time flies") Cent. It was actually the first coin issued by authority of the United States. The motto "Mind Your Own Business" is under the obverse sun dial and the reverse has 13 joined rings representing the original thirteen colonies. This classic design is said to be the work of Benjamin Franklin. Colonials and their prices are in the front of the "Red Book".
17. Do you think it is a good idea to have fractional size gold bullion coins?
    Answer:   All producers of bullion coins make 1/10 oz., 1/4 oz., and 1/2 oz. sizes. Many survivalists believe such coins should be accumulated in case you need emergency size money. It's a good idea to have smaller sizes, but the most economical way to own gold is in the 1 oz. coin.
18. I have done business with you over the years and have gotten used to buying and selling over the counter. Now my wife and I are moving out of state and wonder about the mail?
    Answer:   Actually a large part of our annual volume is done with folks who live outside California. The process of selling to us is as simple as buying. Just call toll free and get our daily buy quote and confirmation number. We will tell you exactly how to package, insure and ship everything and the confirmation number will tell you exactly how much money to expect.
19. I took your advice and purchased my first coin investment book by R.S. Yeoman called A Guide Book Of United States Coins. It makes for fascinating reading but I wonder how the listed prices in the book compare with what I am charged for the same coin?
    Answer:   Great question and great book! The prices in the "Red Book", as it has come to be known in the trade, are updated annually by veteran contributors and therefore the general information is accurate. The daily prices of many quality coins, however, are really controlled on what is known as the Certified Coin Exchange, which is a satellite-controlled computer trading system located in Texas. The largest dealers in the nation actively trade on this system daily so prices can change at any time much the same way stocks move on active exchanges. The cost of coins in the "Red Book" is a good place to begin but you will need more information.
    By the way, C.N.I. also carries a large selection of numismatic books. At any given time we may have 50 different titles in stock at discount prices. So call if you're looking for a special book on coin history, the great hoards, the great people or the great collections!
20. How come the uncirculated silver dollar rolls I purchase from you are not certified?
    Answer:   Quality uncirculated silver dollar rolls are very inexpensive at the moment and make for a great silver investment. The cost per coin is now just so low that it does not justify the expense of sending them to PCGS.
21. What is the difference between a 1 ounce gold bullion coin and a gold bar of the same weight?
    Answer:   Modern bullion coins are popular because they are produced by governments which, in turn, protect the consumer as to weight and purity. Gold bars are produced by reputable firms (Pamp Suisse is a good example) which also protect the consumer as to weight and purity. Both products cost the same and produce the same result so in this case you can pay your money and take your pick. There really is no advantage or disadvantage in either a gold bullion coin or bar. Because of this our "buy" and "sell" price for each product is the same.
22. Are mintage figures a good way to study a coin's rarity or investment potential?
    Answer:   Sometimes mintage figures give important clues to a coin's rarity and sometimes these figures don't mean much. Why? Because it has been the case that large numbers of gold and silver coins have been melted with no regard as to what was in the melt. The Mint kept virtually no records on dates, so a coin with a high mintage might be scarce or even rare if that particular date made up a large part of the coins destroyed.
23. I want to invest but feel I don't have enough money. What do you suggest?
    Answer:   Many investors who now hold substantial positions began with such thoughts. One of the best things about the precious metals and rare coins is that there is always something for every budget. The best thing to do is make the commitment and then consider the various programs available. The Accumulation Program is one of our best because it allows you to participate on a regular basis. As far as rare coins are concerned some of the best available today are inexpensive. Also look into our layaway plans which can be tailored to your needs.
24. Is it true that if you invest $1000 or more in California there is no sales tax?
    Answer:   There is no sales tax charged within California if you invest $1000 or more for precious metals or rare coins. Sales tax is also not charged for out of state transactions.
25. How can a coin have marks on it and still be considered uncirculated?
    Answer:   The marks you are referring to are called "bag-marks" and, as the name implies, were picked up because the reeded edges of some coins created these marks on others while still in the original Mint storage bags. Most coins display such marks, even high grade uncirculated examples, although as the grade increases the number of these marks decreases. For a coin to be uncirculated it does not have to be mark free, it must only lack the usual surface abrasion which comes with normal circulation.
26. I saw a posted bid and ask price that was too low relative to recent changes in the market. What do you make of that?
    Answer: We do our best to post accurate daily prices. There could however be typographical errors on rare occasions. For these we apologize and correct such mistakes immediately. We are not however responsible for such occasional errors and reserve the right to change such mistakes as they come to our attention.  
27. I noticed the dollar amount over spot sometimes varies over time on your bullion coins. Why is this figure not constant?
    Answer: If you notice the difference between our buy and sell (sometimes call the "spread") is constant, but the dollar amount relative to spot will vary with the trader's actual physical position. This happens because we hold the real coins in inventory. When our trader's position is too high he simply charges less and sells for less. When his inventory position is too low he charges more and pays more. That is why the actual price we charge over spot may drift over time and market conditions. Also keep in mind that the difference or spread between bullion products is also subject to change over time, especially if markets are volatile, traders need extra room to conduct and orderly market, or there is no physical product immediately available.  
28. Have a question?
    Answer:   If you have a question about rare coins, currency, or precious metals we would be happy to supply a no obligation personal answer: Just call us Toll Free at 1-800-225-7531 or email Richard at RSchwary@aol.com