Gold Coins and Postage Stamps

What do gold coins have in common with postage stamps? Quite a bit, actually.

For one thing, current stamps are a bargain as is gold, relatively speaking, and their price will keep rising for as long as there is inflation. Today you can buy “Forever Stamps,” whose utility value is all but certain to rise over time, just like gold bullion.

The best investment value is in rare stamps, however, just as it is with rare gold coins. There is but a limited supply and their value depends mostly on their naturally growing demand as collectibles.

Stamps, of course, lack any real underlying asset, and that’s what sets gold coin investment apart. Gold may be playing footsie with $1500 for the time being, but the very fact that prices haven’t tumbled a whole lot more is a strong indication that gold is just being pushed around – it hasn’t turned around at all.

“When this mispricing is inevitably resolved, it is unlikely to be gradual,” says Gold Money. “It will be so swift that those old-fashioned enough to own gold for insurance purposes will have the protection they sought.”

Patience is the secret, if you can call it that, to gold coin investment. It is simply a lot easier to be patient when your investment can continue to grow through periods of confusion and panic. And it is downright comforting to know that demand has been steadily rising for decades and the additional growth in their numismatic value has helped select rare gold coins consistently outperform bullion.

There is one more characteristic of stamps that is especially pertinent to gold coin investment. Josh Billings, American humorist (1818-1885), drew this parallel: “Consider the postage stamp; its usefulness consists in the ability to stick to one thing until it gets there.”

That in a nutshell, is what gold coin investment is all about.

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