Is there any real value in buying a graded bullion coin?

Mark writes: I’ve got a two-part question. Im a rather new gold coin collector. Ive started off just by collecting some “new” bullion coins. (i.e. US Gold Eagles) Firstly, I have heard mixed opinions about “collecting” bullion coins. True collectors are typically into older gold coins, while some collectors have told me that bullion coins are a great place to start a new collection. What do you think? Also, most of the coins that I own now are graded. Is there any real value in buying a graded bullion coin? As they get older will their value appreciate any?

There is certainly nothing wrong with collecting gold bullion coins. I think that many collectors begin collecting with gold trade units since they often have attractive designs, are usually available and are easy to find in nice grades. I think a circulated American Eagle is probably a great deal rarer than one in gem condition.

I would caution about getting caught up in buying third party graded bullion coins by grade. There is really just a one way market for these items and in a rising bullion market these coins again become just gold. Remember that Trade units such as British sovereigns, French, Belgium and Swiss 20 Francs, Mexico 50 Pesos, German 20 Marks etc are still often found in uncirculated condition, often in rolls, yet some are 150 years old.

I don’t believe that any coin should be graded MS70. This was suppose to be a theoretical grade representing a Kantian state of perfection. Since no one or no thing is ever perfect, this grade should remain an ideal that is never reached, something akin to the speed of light. Allowing coins to be graded MS70 opens up the possibility of one day waking up to, Voila, MS71, something even more “perfect”.