Gold Coins

The most perfect monetary system humans have yet created was the world gold standard system of the late 19th century, roughly 1870-1914. We don’t have to hypothesize too much about what a new world gold standard system could look like. We can just look at what has already been done.

Contrary to popular belief, people generally did not conduct commerce with gold coins. Yes, gold coins existed, but people mostly used paper banknotes and bank transfers, just as they do today. In 1910, gold coins comprised $591 million out of total currency (base money) of $3,149 million in the United States, or 18.7%. These gold coins were probably not used actively, and served more as a savings device, in a coffee can for example.

Silver coins were also used, but by then they had become token coins, just like our token coins today. By 1910, most countries in the world officially had “monometallic” monetary systems, with gold alone as the standard of currency value. This eliminated many of the difficulties of bimetallic systems, which had caused minor but chronic problems in the earlier 19th century

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What You Should Know About Your Coin Collecting

All it takes is the willingness to learn new things.

I got started collecting coins like lots of folks, I imagine. I just happened across an unusual coin and I was curious about it, so I stuck it away so I wouldn’t spend it.

Almost everyone has a “special” coin that they hold on to for some reason or another.
Kennedy Half Dollar
Maybe it is an old Buffalo Nickel or a silver dollar that your grandparents gave you. Maybe it’s an Indian Head Penny or a Kennedy Half Dollar

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Most Common Misconceptions About Coin Collecting

People will often describe a coin as being “Very Good”. But as you can see, a “Very Good” coin is not all that great. In “coin language” it means the coin is only average compared to other coins of its denomination collected from circulation.

An Uncirculated coin means just that. It has never been used for commerce, has absolutely no wear other than bag marks. It is as it came from the mint presses.

An Uncirculated coin may still not qualify as Brilliant Uncirculated, which is reserved for the most perfect of coins. The BU designation is reserved for those coins that have the best strikes from the press.

The Shedon Scale

William Sheldon is credited with creating the coin grading system primarily in use today. Known as the Sheldon Scale, it is a numerical scale from 1-70 that corresponds to the system above with 1 being the Poor end of the scale and 70 being the perfect, or nearly pefect, Brilliant Uncirculated coin.

In the Sheldon Scale:
Poor=1, Fair=2, About Good=3, Good=4-6, Very Good=8-10, Fine=12-15, Very Fine=20-35, Extra Fine=40-45, About Uncirculated=50-58, Mint State=60-70 and Mint Proof State=60-70

If you’ve poked around a few coin shops or checked out the coin auctions like at eBay you’ll have seen coins designated VG, MS64, AU55, F45. Now you’ll know what those designations mean!

Grading coins, though, is subjective. What I may think of as an AU50 you may see as only a F45. Learning to grade coins is a skill you’ll want to start learning even before buying your first coin.

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Start Your Own Coin Collecting Club

Many people like to start a coin collection for their children, or grandchildren, as a sort of investment for them. These collections are typically held by the parent or grandparent on the child’s behalf, with the intention of giving them to the child at a certain age, or as an inheritance, although sometimes the coins are given directly to the children.

Before you start collecting coins on behalf of your kids, you should take a moment to consider a couple of points. First of all, like all investments, collecting coins costs money, so you need to determine how much you can afford to spend each year for this. Secondly, you must decide what the ultimate goal of this collection is. Are these coins meant to help put the child through college, or are they just meant to be a nice gift that hopefully has some greater future value? Is this coin collection meant as a monetary investment to be cashed in someday, or do you mean for the coins to become family heirlooms which will be passed down through the years? Or perhaps your hope is that the child will take up the coin collecting hobby someday. Depending on what your collecting goals are, and what your budget is, you’ll want to buy different types of coins.

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