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AUCTIONS & COLLECTIBLES Modern CAR COLLECTING
F O R T H E N E XT 2 0 Y E A R S
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16 The Hobby of Kings Amber Ness takes us on trip through the world of coin collecting and numismatics and explains the fundamentals and differences between coin and bullion investing.
6 World News 12 Metals Market Report SPECIAL FEATURES
22 Counterfeit and LBMA 28 Investing for Geeks 34 Busting the Myths in Sports Memorabilia
22 Counterfeit and LBMA
58 Five Years of Treasure NUMISMATICS
The importance of Good Delivery is tackled again this time in relation to the world of counterfeiting in bullion and the coin world.
16 The Hobby of Kings HARD ASSETS
40 Buying Metals at Auction
34 Busting the Myths of Sports Memorabilia A seasoned expert reviews some of the myths surrounding this market and provides some much-needed clarity to investors looking to add to their collections.
50 10 Tips LIFESTYLE AND LUXURY
46 The Knife That is Art 54 Just Luxe 66 Building Wealth Through Cards 72 Cars for the Next 20 Years MINING & MINERALS
58 Five Years of Treasure
80 Mining News REFERENCE
Hector Cantú details for us age-old treasure from the past five years sold at auction and provides a wide array of super-antiques to keep your collector’s fire stoked.
88 Preferred Dealers 94 Events 96 Hindsight
72 Cars for the Next 20 Years Jason Vaile takes a look at the coolest vehicles on the planet that will be in the collector’s focus for the next 20 years and beyond. Don’t get caught speeding!
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EDITOR’S NOTE
AUGUST / SEPTEMBER 2014
PRESENTED BY: AHA Metals, LLC VP CONTENT: Brad Hastedt EDITORIAL SUPPORT: Kevin Thompson
Collecting in All Forms
VP SALES & MARKETING: Mike Obert SUBSCRIPTIONS: Leigh Chamberlain LAYOUT DESIGN: Noel ‘Kip’ M. Macasero, J.K. Monte de
G
reetings to all of our readers and hopefully you have enjoyed the season and experienced plenty of warm summer fun in your part of the world. Welcome back to the next edition of American Hard Assets.
Ramos, (Open Look Creative Solutions)
FEATURE WRITERS: Eavan Moore, Jason Vaile, Amber Ness, Richard Alexander Rogers, Michael Haynes, Vicki Arkoff, Mila Pantovich, Dave Sliepka, Emily Manke, Hector Cantú, Doug
This issue, our focus is on collecting and auctions. Not only for precious metals, but for all different kinds of assets that you, the reader, may be interested in and investing in as the moment. Assets are the focus here and we’re bringing you lots of content with a definite focus on gold and silver, but also great info on numismatics, refining news, baseball cards, collectible knives, and a whole host of other interesting stuff.
Kale, Abe Elias, Hayden Tubbs
CONTRIBUTORS: Christy Stewart, John W. Garibald, John Maben
DISCLAIMER: American Hard Assets is 100% American owned. All contents of American Hard Assets (AHA) are for information purposes
As we always do in this part of the publication, we ask you again to please visit our website atwww.ahametals.com. In there you will find the up-to-date news and stories you’ve come to expect from AHA along with great content from our partners, real-time updates, exchange rates, metal prices, and more. We’ve introduced more original content on the site in recent months from our great bench of industry writers and plan to feature even more going forward.
only. AHA does not guarantee the accuracy, completeness or timeliness of the contents. None of the information contained herein constitutes a solicitation, offer, opinion, or reccomendation by AHA to buy or sell any security or commodity, nor legal, tax, accounting, or investment advice or services regarding the profitability or suitability of any security, commodity or investment. All commentary and advice in this publication is of a general nature
So, we’re all set to head into the Fall and to take a look at collectible bullion and other great hard asset auctions and collectibles that will stir your interest. We are excited to bring you this fourth issue of the year and, as always, don’t hesitate to give us feedback on the magazine or online to help us get better. We say it every time, but we are committed to bringing you the news and stories you want and need to see. 4th Q UAR
Thank you for continuing your commitment to this publication and keep up with American Hard Assets for all your metals news in the future.
objectives. You should always consult a licensed financial advisor for your personal investment advice. Please do your own research.
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H A R D A S S E T U P D A T E S | World News
World News Updates
World’s Largest Economy 2014
T
CHINA
his year China will become world’s largest economy. New economic world order: 1. China. 2. USA. 3. India
World Bank’s new report shows that China is all but guaranteed to outperform the US this year as the world’s largest economy, currently just a hair’s breadth away from claiming the first spot, while India stands at a solid third place.
the process, India vaulted from the tenth-largest world economy to the third-largest in the span of just six years. But given the rate at which China has grown, which is astronomical by any standard, the World Bank surmises that the eastern superpower will surpass the US in economic size at some point this year itself. China’s economy has sustained to rise at an accelerated rate, increasing by 7.7% in the last quarter of 2013 and falling only slightly to 7.4% in the first quarter of this year, according to Reuters. The US, meanwhile, only rose 0.1% in the first quarter of 2014. In terms of the total world GDP, the US accounted for about 17.1% of it in 2011. China followed closely with 14.9%, and India was third with just 6.4%. The rest of the top 12, according to the report, were Japan (4.8%), Germany (3.7%), the Russian Federation (3.5%), Brazil (3.1%), France (2.6%), the UK (2.4%), Indonesia (2.3%), Italy (2.3%), and Mexico (2.1%). The same order holds when examining the countries in terms of their percentage of the US GDP, albeit with different percentages.
The study, put together under the World Bank’s International Comparison Program, analyzed the Purchasing Power Parity (PPP) of various nations. By using PPP, says the report, researchers were allowed to essentially equalize the disparate currencies of the countries that were studied, and compare “size and price levels of economies around the world.” The numbers, all of which are from 2011, show that China’s overall GDP was 87% of that of the US, more than double the 43% that Chinese GDP was in relation to the US in 2005. India had similar growth, jumping from 19% of US GDP in 2005 to 37% in 2011; in
However, of those nations, India is the one with the highest index of GDP per capita (when examined via PPP), at 127. To put that number in perspective, Indonesia comes in at second place with 107, while China has 99, Brazil has 80, Mexico has 72, and the US is actually in last place of the top 12 nations, with an index of 12. The six largest middle-income economies – China, India, Russia, Brazil, Indonesia, and Mexico – constituted just over 32% of the world’s total GDP in 2011, which was just shy of the 33% accounted for by the world’s six high-income economies (the US, Japan, Germany, France, the UK, and Italy). In total, these 12 nations were responsible for more than half of the world’s total GDP in 2011. Source: www.americanbazaaronline.com
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World News | H A R D A S S E T U P D A T E S
World News Updates
N U M I S M A T I C S The World of Coin Collecting
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or more than 200 years, coin collecting or numismatics, has been a popular hobby in the United States (and many other countries).
The Sheldon grading scale, which positions the condition of all coins, from Good (AG3) to Perfect Mint State (MS70), is something a neophyte collector must be familiar with in order to understand the hobby. The United States Mint (with branches in Philadelphia, Denver, San Francisco and West Point) currently creates, designs and produces all of the coinage supplied in the U.S. The main metals of most coins are: copper, silver, nickel and gold. Most young collectors usually commence with the basic Lincoln penny albums, and work their way up to other groups of coins. There are also carefully assembled “type” sets, which consist of one coin of each denomination. This can be a very large set, when you consider the frequent design changes. Then, there are the “high rollers” who spend many thousands of dollars for key (rare) date coins. Some rarities have sold more than a million dollars each! In order to get the fairest deal for your coins, you must know how coins are sold and traded. Another proposition is to learn what the daily price of bullion is. This can be found on the Internet or your local newspaper (commodities section). Review this list of possible outlets for buying and selling coins. Large national coin dealers: Many of these dealers are found on the Internet or in magazine ads. You can acquire pricing information; however, these long-distance outfits are far away, which limits examination of the actual coins that you’re interested in.
Local coin dealers and coin shows: This is an ideal situation, as you meet the dealer, and you can look at the merchandise. It is best to verify their Better Business Bureau ratings. Most dealers are honest and reputable. Remember, a graded or certified coin (NGC or PCGS) can be researched and an accurate value verified. These are called “slabbed” coins. A word of caution, however: DO NOT walk in to a coin shop or a coin show without having a good idea of what your coins are worth! A good suggestion is to “shop around,” and compare offers. Auction houses: Millions of dollars worth of coins are sold every year via the “live” auction route. This is especially true of the rarities. One advantage of a live auction is that you are able to view the lots or sets of coins that will be sold (prior to the actual bidding). E-Bay (The online auction site) has been successful for many people. It is best to understand terms such as “Consignment,” “Hammer Price,” and “Reserve Bids.” Take the time to familiarize yourself with the mechanics and the bidding procedures of this Internet site. Mail-away gold buyers: This is a sure-fire to lose money! The ads of TV are very tempting. You fill up an envelope with gold jewelry or gold coins, and send it off to some far-off company, which promises to give you a “fair price” for your metal, and your check within a few weeks. Really now? If it seems too good to be true, it is! Hotel buyers: It sure sounds good! Those large-sized newspapers ads. The fancy local area hotels. The promises of “top prices” paid. When the dust settles, you are lucky to get 30 cents on the dollar! After the company organizing these hotel “shows” leaves town, you are out of luck. Advice — stay away for these folks! Miscellaneous: Pawnshops and jewelry stores are usually not certified or qualified coin dealers. You will be fortunate to be paid the regular bullion price for the metal content. Pawnshops can be convenient when you are looking for an unclaimed item that has been lowered in price or need to get hold of a short-term loan.
Source: www.melrose.wickedlocal.com
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H A R D A S S E T U P D A T E S | World News
World News Updates
World’s Most Expensive “Gold” Bicycle This solid gold 24-carat bicycle is the most expensive in the world. The one of a kind mountain bike was produced by The House of Solid Gold, based in California, and comes with an estimated $1,005,300 price tag. The flash two-wheeler is covered almost entirely with 24-carat gold, and comes complete with a customized seat cover crafted from brown alligator hide. If that wasn’t flash enough, it also has a unique water bottle, which is coated in solid gold and decorated with stingray skin. Hugh Power, CEO of House of Solid Gold, said: ‘The idea came about while I was extreme mountain biking on a similar bike. It was during this ride that the idea was born to build a gold bike, custom-made with all the latest hi-tech gear. But the true challenge I faced was to make sure that the bike would be rideable – and I was still able to cover 99% of the bike completely in gold.
‘This is the only gold bike in existence. And there will only be 13 made in total with each one being custom built and totally unique in its own right.’ It took more than 750 hours to painstakingly handcraft the elaborate cycle, and there are plans to produce just a dozen more of the luxury items. Each bike will be engraved with the artist’s signature, dated and numbered as one of 13. The 57-year-old entrepreneur added: ‘The price tag on the bike is only so high because most – if not all – of the proceeds will be donated to charity. ‘The Way to Happiness Foundation is a global non-profit, nonreligious charitable organization that do a lot of impressive work to combat crime and violence worldwide. ‘And buying the bike is more a way for the wealthy who want to donate their money to a great worldly cause, and receive the bike as a token.’
Source: www.uk.news.yahoo.com
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World News | H A R D A S S E T U P D A T E S
World News Updates
The Bitcoin “Crisis” 5 Reasons It Can’t Be Killed
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ith a cursory glance, at today’s price ($500), you’d think that the Coca-Cola of cryptos is careening toward disaster. In order to know why that’s not the case, you might need a quick recap on how we got to this juncture. Near the end of last year, Bitcoin was being gobbled up at an unbelievable $1100 per coin.
with Bitcoin at large, but with the implementation method of certain exchanges. Unfortunately, Mt.Gox still wasn’t able to get their act together. They went into full damage control mode, preventing their users from making withdrawals altogether. That’s when people really started freaking out. A shit-storm of downright apocalyptic press ensued, contributing to a big dip in the price of Bitcoin.
Early 2014 was a PR nightmare for bitcoin. The crypto was constantly being linked to money laundering and drugs, most infamously in the case of The Silk Road. But, the most damning sequence of events was due to a known security vulnerability and good-old-fashioned ineptness.
In light of this Mt. Gox debacle, other big players in the Bitcoin community banded together to say enough is enough. This cryotocurrency coterie further demonized Mt. Gox, strongly implying they could no longer be trusted. Meanwhile, reports were circulating that over $400 million worth of Bitcoin had been “stolen” from Mt. Gox customers due to exploitation of the very same bug they’d been battling. By the end of February, Gox went dark completely, along with all that missing Bitcoin.
The Hurricane Gox By February, major (but known to be sketchy) Bitcoin exchange Mt. Gox had been having problems for quite awhile. Because of that aforementioned security issue, Mt. Gox halted some of their user’s ability to withdraw Bitcoin while they fixed the hiccup. Other more legit companies came forward to show that this wasn’t a problem
In late March, the government of China slapped some really provisional rules on banks with regard to Bitcoin, essentially putting it in a legal gray area. Some are also reacting negatively to the IRS’s recent ruling on Bitcoin.
Source: www.huffingtonpost.com
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H A R D A S S E T U P D A T E S | World News
World News Updates
So, now that we’ve trudged through the (highly-simplified) negative muck and mire of the last few months, let’s take a look at the 5 reasons Bitcoin is not only here for the long haul, but may seriously impact the world in a litany of positive ways.
5. The Spread For cryptos to really wield a lot of power, they need to be easy to use. That means merchants must accept it on a wider scale — and that they are. There are thousandsof local restaurants, bars and businesses primed to take your sweet coin. On the web, significant players like Square, Stripe, Overstock, and Tiger Direct are a few of the latest to pick it up. No, it’s not at Target or Amazon yet, but if it ever is expect another bump in interest, price and media hype.
4. The Progeny Because of Bitcoin’s coding is available to the public, there’s been a rabbit-like reproduction rate of crypto currencies. Literally hundreds of Bitcoin spinoffs, or “forks” have sprouted up and dozens of them are quite successful, with market caps well into the millions of dollars. Some even argue that certain more nimble cryptos like Litecoin, Feathercoin, or (my favorite) Dogecoin, actually improve upon what Bitcoin started.
3. The Philosophy “Price is the least interesting thing about Bitcoin… At first, almost everyone who got involved did so for philosophical reasons. We saw Bitcoin as a great idea, as a way to separate money from the state.” — Roger Ver, The New York Times. One of the most attractive things about Bitcoin is the philosophy behind it. It’s designed to be completely decentralized, anonymous, egalitarian, and free from external or internal manipulation. It’s neither liberal nor conservative. There’s no Federal Reserve sending down mandates from on high. It is, 100 percent, a digital manifestation of the consensus of its users.
2. The Numbers Let’s start with the cryptography and coding. Consider this — of the hundreds of cryptocurriences out there, basically all of them use Bitcoin’s backbone. Because the king of cryptos is open-source, everyone has worked together to create something highly-functional and thus far, unhackable. As Bitcoin continues to mature, so do the exchanges and wallets, making them safer. As we’ve seen from the Mt. Gox snafu, companies that aren’t backed by a strong team of properly qualified people simply cease to exist, leaving the strong to take the reigns.
1. The Community Ultimately, the power of Bitcoin is, and always will be, in the hands of the people that use it. Thousands of people in over 60 countries are gathering in meat space to learn, discuss and philosophize about Bitcoin. While attendees definitely run the gamut in terms demographics, experience and degree of technical knowledge, many are deeply involved in shaping how the technology will be used and experienced going forward. Because of this passionate, highly engaged grassroots community, literally hundreds of startups with an average value of nearly $4 million have cropped up in just a couple of years. Given the fact that this technology and its implementation is still so young, we don’t know what these companies, coders, meet-up groups, miners and just flat-out curious people will eventually accomplish. But, when you diminish or scoff at Bitcoin at this point, you’re essentially deriding hundreds of thousands of tech-savvy, hungry, young people — not a great group to bet against. Though speculation and hyperbole will surely continue as the price inevitably waxes and wanes, the technology, infrastructure and tenacious group of humans pushing this thing forward aren’t simply going to stop. Despite all the misinformation, resistance and doomsday prognostication along the way, Bitcoin has and will continue to defiantly weather the storm. Source: www.huffingtonpost.com
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World News | H A R D A S S E T U P D A T E S
World News Updates
MIAMI MONEY The Most Expensive Penthouse Condo in Miami Beach History t the very top of Miami Beach’s Faena House is a super-luxe penthouse condo that was listed for $50 million is in contract, making it the most expensive condo ever sold in Miami Beach, according to The Wall Street Journal.
A
Most notably, the penthouse features a beautiful “alero,” a sweeping Brazilian-style terrace that wraps around the entire building and adds a staggering 7,000 square feet of outdoor living space.
Though the closing price and the identity of the buyer were not revealed, the agent who represented the buyer told the WSJ that “his client liked the privacy afforded by the fact that the building has a rooftop pool and is relatively small—47 units.”
Designed by Foster + Partners (the same architects responsible for the Hearst Tower’s new facade), the 8,000-square-foot condo unit has five bedrooms, a private interior elevator, a media room, great room and dressing room, and two custom kitchens according to the Faena House’s website. Outside there’s also a cabana, an outdoor kitchenette and private 70-foot infinity pool.
Argentina’s Faena Group developed and built the Faena House, an 18-story condominium tower that sits on Miami Beach’s widest stretch of white sand. It contains 47 residences, but the penthouse, with panoramic views of the beach, bay and downtown skyline is by far the most luxurious.
All building residents have access to hotel-style services and amenities such as valet and private concierge service, fitness center and an in-house spa with direct ocean views, a private Beach Club with full cabana service, and two pools.
Source: www.businessinsider.com
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S E C T I O N N A M E | Story Name
By Michael Haynes,
ceo apmex.com
It may be time for diversification because of uncertainty.
B
oth Gold and Silver have been up and down in the first half of 2014, but what is the time, what is the season for Gold and Silver for the second half of 2014 and beyond?
the second half of 2013, has limited the authorized purchasers from placing orders to an amount based on an allocation of the production of the Mint up until May of 2014.
Physical Silver has recently been in a market where the supply and the demand have been very close with virtually no surplus or deficit in ounces since 2006, except for slight increases in 2009 and 2010. As shown in Table 1, global Silver inventories have decreased approximately 784 million ounces since 2000.
When examining the supply of physical Silver since 2000, the Secondary market supply has annually provided between 24% and 30% of the aggregate supply and in 2013, the portion provided by Secondary sources was a 13 year low of 24%. In fact, the 2013 Secondary market supply was approximately 230 million troy ounces, approximately the same level as in 2004, nine years earlier.
Because the net position in Physical Silver has been edging downward since 2000 and because in recent years, physical Silver supply and demand has been so close to a net zero change in inventories, the overall market for physical Silver has been very reactive to price changes. For example, the United States Mint, since
The issue in the Secondary market supply seems to be the market price of Silver. In Chart 1, the annual Secondary supply is shown relative to the price of Silver per ounce and falling
While no one can predict the future, we can look at recent data along with the current economic “tea leaves� and provide some interpretation and perhaps some insight.
How Silver is Biding Time in 2014
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Metals Market Report | H A R D A S S E T U P D A T E S
Silver prices in 2012 and 2013 seem to be having a significant effect on the decisions in the Secondary Silver market to submit Silver for refining. Although there are many factors in the supply of Silver, it appears that Silver prices may have an impact on the inflow from Secondary sources and perhaps may cause mining activity to slow.
in 2000 to a record level of over 136 million troy ounces in 2013, an increase of over 260% and an increase of 43% from 2012 to 2013. In Chart 3, it appears that lower Silver prices in 2013 did not inhibit investment coinage demand, but on the contrary, such demand increased to record levels.
Chart 1.Annual Secondary Source of Silver and Silver Price per Troy Ounce, 2000-2013.
Chart 3. Annual Physical Investment Demand in Silver Coinage and Price perTroy Ounce, 2000-2013.
From the demand side of Silver, there is evidence of rapidly increasing demand in Photovoltaics (batteries and solar devices), increasing in demand by 46% in 2013 over 2012. Shown in Chart 2 are the major segments of fabrication demand in Silver since 2000. Generally speaking, lower Silver prices should have a positive effect on demand from the largest segment of demand in Jewelry/Silverware as lower prices should stimulate more demand.
Will the alarm go off in Silver?
Chart 2.Annual Fabrication Demand for Silver in Troy Ounces by Segment, 2000-1013.
With Silver prices hovering around $20 per troy ounce, the historical data would indicate that supplies of Silver, especially from the Secondary markets, will be constricted. On the demand side, industrial use of Silver will not be inhibited by lower Silver prices and perhaps fabrication demand may increase in the Jewelry/Silverware segment as prices remain relatively low compared to the prior three years. Also affecting Silver demand, investment coinage does not appear to be negatively impacted by lower Silver prices, but on the contrary, investment coinage demand rose in 2013 to record levels and the year to date mintage by the United States Mint seems to be approximately the same pace in 2014 as 2013. Accordingly, will Silver prices rise given the pressure applied by lower supply and potentially rising demand? While no one can predict the future, it appears that the clock is ticking on physical Silver.
Gold May be Waiting for the Bell to Ring
The final section of demand is from investment measured by Silver bullion coin production in the six main issuing countries of the United States, Canada, Austria, Germany, Mexico and China along with other countries consuming physical Silver in coin production. The investment coin Silver demand has grown from approximately 38 million troy ounces
Gold supply is proportionately more reliant on mining than secondary sources over the last nine quarters with mining providing on the average 67% of the market supply for the entire period, but in the last four quarters ended March 31, 2014, mining has provided a higher portion of total market supply of 73%, 70%, 72% and 69%, respectively, of total market supply. The converse of this Gold supply is secondary sources which have been, not surprisingly, below recent historical levels. Chart 4 shows that for the last five quarters ended March 31, 2014, secondary sources of Gold have consistently fallen below levels established in the previous four quarters ended December 31, 2012. This means that physical Gold supply has been hindered for the entire year of 2013 and continuing in the first quarter of 2014. www.ahametals.com American Hard Assets | 13
H A R D A S S E T U P D A T E S | Metals Market Report
Chart 4.Quarterly Secondary Source of Gold and Gold Price per Troy Ounce, Q1 2012 – Q1 2014.
When examining the demand for Gold, it is evident in Chart 5 that the demand in Jewelry, Technology and even in Central Bank purchases is relatively consistent, quarter after quarter for the last nine months. However, the Investment demand seems to expand and contract, expanding during the three consecutive quarters ended December 31, 2012, yet contracting for the four consecutive quarters ended December 31, 2013. For the quarter ended March 31, 2014, Investment demand expanded by 47% over the quarter ended December 31, 2013. Chart 5.Quarterly Demand for Gold in Troy Ounces by Segment, Q1 2012 – Q1 2014.
Chart 6.Quarterly Net Investment Demand for Gold in Troy Ounces, Q1 2012 – Q1 2014.
Note that the Net Investment Demand did contract for the four consecutive quarters ended December 31, 2013, however, this was caused primarily by the liquidations from the Gold ETFs. The data shows that the Physical Gold Bar and Coin investment demand was more than sufficient to offset the ETF liquidations. In fact, Physical Gold Bar and Coin demand increased each quarter for the four consecutive quarters ended June 30, 2013, with physical investors in contradiction to ETF investors during most of this period. Many believe that the Gold ETF has more investors with short term trading windows, perhaps a day up to a month in duration, while Physical Gold Bar and Coin investors have a longer term outlook, perhaps three to five years.
When will time strike midnight and awake the Gold market? From the supply side, Gold is meeting the demand with a decreasing contribution from the secondary sources, which sources are unlikely to increase without a price rise to attract more of the Gold product ready for recycling. From the demand side, all of the segments of Gold demand, except for Investment demand, are relatively stable for the last nine quarters. Investment Gold demand recorded a net contraction in recent quarters but only as a result of Gold ETFs shedding ounces which were readily absorbed by the Physical Gold Bar and Coin demand.
Even though the Investment demand has both expanded and contracted, Chart 6 shows the breakout of Investment demand between the Gold ETFs and Physical Gold Bar and Coin. (For the sake of clarity, according to the World Gold Council, the data for Physical God Bar and Coin demand relates only to the investor demand for the physical Gold and does not include any Gold Bars for any of the future exchanges.)
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With the supply and demand for Gold appears to bring on the two factors, (1) secondary market supply influenced by current Gold prices, and (2) Investment demand influenced by relatively strong long term oriented Physical Gold Bar and Coin demand and short term oriented Gold ETF demand. Accordingly, the it appears that the time for Gold awakening may be an event in the global economic markets or a global political event that causes the short term investors to expand Gold ETF demand which would also likely increase the long term investors demand for Physical Gold Bar and Coin demand. For those awaiting such an event, look to the European Union and the Euro and to the upcoming United States Congressional elections in November 2014, which in both cases may provide evidence of the coming economic course.
Story Name | S E C T I O N N A M E
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S E C T I O N N A M E | Story Name
A Glimpse Into the World of Numismatics By Amber Ness
O
n June 2 of this year, Doritos launched a clever campaign: the 24K Gold-Plated Doritos® Chip Replica Giveaway.
Hoping to start a stampede of customers filling their arms with as many bags of the salty snack as they could carry, the campaign also targeted a growing number of Americans investing in precious metals — and collecting it.
Collecting Gold: An Ancient Pastime A renewed interest in precious metals and coin-collecting doesn’t mean it’s a new phenomenon. In fact, collecting gold artifacts has been popular among the affluent since the beginning of civilization. Coin-collecting is a tradition as ancient as Rome.
The 50-year-old snackfood brand released 3,000 (inedible) gold-plated tortilla chips, and tickets to redeem them were found inside random bags of Jacked Bold - Mystery Flavor Doritos. Worth about $31 apiece, each tortilla-chip-o-gold came with a chance to win the grand prize — a 2.5 ounce, 24-karat gold replica of the iconic chip, valued at roughly $3,000.
Catalogued by sovereign treasuries, hoarded by nobility, and viewed as a portable form of art, coins have been valued above and beyond their metal content for millennia. First Roman Emperor Augustus (September 23, 63 BC - August 19, 14 AD) was famous for flaunting his personal stash of historic coins in front of prestigious guests, even offering them as lavish gifts.
Besides offering customers the thrill of an old fashioned treasure-hunt, the Doritos giveaway satisfied a renewed interest in precious metals among increasingly-young, mainstream investors, along with a desire to own collectible bullion.
Under Emperor Trajan Decius (AD 249 - 251), the Roman Mint began producing commemorative coins honoring past rulers and the coinage they produced.
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The Hobby of Kings | N U M I S M A T I C S
Perhaps a lost art during the Dark Ages, coin collecting grew in prominence during the Renaissance, quickly dubbed the “Hobby of Kings.” Accessible mainly to the gentry, princes across Europe began handpicking the world’s most ancient, beautiful and collectible coins as a diversion — and a way to flaunt their wealth. Famous Italian poet and scholar Francesco Petrarch (1304 - 1374) is widely regarded as the first major coin collector of the cultural rebirth. He honed his craft after vine diggers began asking him to classify ancient coins they found long-forgotten in the earth. In 1355 Petrarch unveiled his remarkable collection to Holy Roman Emperor Charles IV, garnering the sobriquet the “Father of Numismatics.” By the seventeenth century, ardent numismatic study was underway. During the Enlightenment, it grew as a legitimate academic discipline — a science — and coin collecting would never be the same. Vast collections owned by wealthy families were catalogued and examined, and treatises were quickly published, bringing numismatics to the masses. Coin collecting was soon accessible to the middle class, giving average citizens the rare opportunity to own a tangible (and affordable) piece of history. In the centuries following, collectors began to purchase exotic coins from all corners of the earth, along with rare, antique and commemorative coins from home. Fast forward to today, and purchasing coins is not only a hobby, but a form of investing — a way to safeguard one’s hard-earned wealth.
Coin Collecting vs. Bullion Investing
• Chinese Pandas Minted by the People’s Republic of China, Chinese gold and silver Pandas are considered legal tender, issued in various sizes from 1/20 to one ounce. Though they are highly popular among investors, annually-changing designs make these coins collectible, too. The coins celebrate one of the China’s most iconic creatures: the giant panda. The obverse (or front) of the coin features the Temple of Heaven, a famous UNESCO World Heritage Site built between 1406 and 1420 in celebration of the Winter Solstice.
• America the Beautiful Silver Coins Commissioned by America’s Beautiful National Parks Quarter Dollar Coin Act of 2008, the United States Mint began issuing America the Beautiful (ATB) five ounce silver coins in 2010. Among the world’s most popular bullion series, the coins pay tribute to national treasures, both natural and man-made. Each year, five coins are released honoring different monuments — from Yellowstone to Mount Rushmore. The series is also issued in more affordable (and also collectible) quarter sets.
In the world of coins, there are two camps: numismatic coin collecting and bullion investing. Though the two often overlap, they are not one in the same. So what is the difference between numismatic and bullion coins?
• Canadian Wildlife Series
Put simply, a collectible coin has value based on its rarity, history and condition, while a bullion coin has value based mainly on its precious metal content. For instance, a 1933 Double Eagle sold for $7.5 million in 2002. Why, you ask? Because few of the coins escaped melting by the United States Mint after it became illegal to own gold coins during the Great Depression. The sheer rarity of a 1933 Double Eagle makes it incredibly collectible — and expensive. Yet there is sometimes an overlap between numismatic and bullion investment coins and rounds. Bullion coins in pristine condition (graded Mint State 69 or 70), limited releases, commemoratives, special editions, colorized coins, temporary series or proof condition coins may all be collectible forms of bullion.
The Royal Canadian Mint is famous for producing some of the world’s purest bullion coins in some of the most striking designs, and that includes its Silver Wildlife Series. Launched in September of 2010, the series celebrates Canadian wildlife at its finest. The coins contain an ounce of pure silver, and are released in extremely limited quantities — making them highly collectible.
• Australian Lunar Series Deemed legal tender, the Perth Mint of Australia’s Lunar Series made its debut in 1999, followed by the Lunar Series II in 2008.
Both private companies and sovereign mints are increasing their emphasis on high-end art, thanks to a new wave of demand for collectible bullion coins.
Wildly popular among investors and collectors thanks to
And there are countless examples.
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N U M I S M A T I C S | The Hobby of Kings
annually-changing designs and purity of metal, these gold and silver coins celebrate China’s ancient Lunar Calendar, which assigns each year an animal. For instance 2014 is the Year of the Horse, and this year’s design features the fierce image of a running stallion.
• Pre-1933 Gold Coins Pre-1933 gold coins — including Saint Gaudens Double Eagles, Indian Head Eagles and Walking Liberties — are each a piece of history and an investment in gold. In 1933, the brand new Roosevelt Administration ordered Americans to relinquish their gold coins to the government, hoping to end the depression. Gold coins weren’t issued by the United States Mint for another 40 years, adding to the value of coins produced before the nation left the gold standard.
• United States Proof and Mint Sets The United States Mint releases proof, silver proof and uncirculated clad coin sets each and every year. Touted as “the staple of coin collecting” by the mint, accessible versions of the nation’s most popular coins are beautifully packaged inside inert (safe) materials, perfect for the collector looking for an affordable bet.
• Collectible Private Mint Rounds Sovereign mint coins are not the only forms of bullion that are collectible. Private mints all over the country are producing rounds that may be more valuable than their metal content alone. Capitalizing on the latest zombie craze — initiated in part by AMC’s wildly popular show, The Walking Dead — Provident Mint began producing the Zombucks: Currency of the Apocalypse™ silver and copper round series. “Zombifying” some of the United States’ most iconic coins, from the Morgan Silver Dollar to the famous Gold Buffalo, the series exploded onto the blogosphere and spread like wildfire, making the rounds an instant success. Released in limited quantities, the mint plans to produce 10 designs in total (one every three months) to hordes of anxiously-waiting investors — and collectors.
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What exactly makes a coin collectible, valuable or expensive? The answer is generally demand + notoriety. The Fundamentals of Collecting Coins In an article published by ABC News, Scott Travers, author of The Coin Collector’s Survival Manual said typical pieces like $20 gold coins are often viewed as prudent investments because their value is about equal to their weight in gold. “So there’s very little downside to them,” said Traverse, during the World’s Fair of Money. “If gold goes down in value, collectors (who prize the coins for their beauty or historical significance) will still pay about that price. And if gold goes up in value, then the coins become worth even more.” Yet that doesn’t mean collecting stops at the prudent. What exactly makes a coin collectible, valuable or expensive? The answer is generally demand + notoriety. If there are fewer of a particular coin than there are collectors who want to own it, the coin grows more collectible. And expensive.
Defining Coin Collecting Besides labeling it one of the world’s oldest hobbies, the Encyclopedia Britannica defines coin collecting — or numismatics — as “the systematic accumulation and study of coins, tokens, paper money and objects of similar form and purpose.” The Smithsonian Institution, established in 1846, has its roots in numismatics: James Smithson’s donation to found the institution was made in 104,960 British Gold Sovereigns. Over the course of the next century, the museum’s collection continued to grow, and the Smithsonian’s National Numismatic Collection was formed — the official coin cabinet of the United States and part of the National Museum of American History. Today, the museum is home to more than a million numismatic objects. Some of the Smithsonian’s most valuable coins include: • A Class II 1804 Silver Dollar - Considered one of the United States’ most famous coins, the 1804 Silver Dollar was actually a counterfeit struck 50 years later. Only one of the coins exists, and it insured for more than $3 million.
The Hobby of Kings | N U M I S M A T I C S • 1933 Double Eagles - Holding the record for the second highest price paid at auction, a 1933 Double Eagle sold for a whopping $7.59 million in 2002.
• 1913 Liberty Head Nickel - Insured for $2.5 million, the Smithsonian holds one of only five of these coins known to exist.
• 1776 Continental Dollar - The first coin designed for the United States — and believed to be the brainchild of Benjamin Franklin — this short-lived coin failed, thanks to a lack of French silver available to the colonies.
Besides the Smithsonian, in the mid-nineteenth century, coin regulatory bodies began to spring up, aiming to further the study of coins. The Royal Numismatic Society was founded in 1836, followed by the American Numismatic Society (1858), the American Numismatic Association (1891), and later, the Royal Canadian Numismatic Association (1950). These organizations, along with a deeper understanding of the science of numismatics, proved to be invaluable, as the collecting of coins grew in prominence among the masses — and once again, the rich and famous.
• 1849 $20 Gold Coin - The first $20 coin released by the United States, the Smithsonian owns the only final strike known in existence.
The Playboy King and His Famous Coin Collection Farouk I of Egypt reigned from 1936 - 1952. An avid collector of all-things opulent and strange, the country’s last monarch was often called the “playboy king” — his horde of palaces, cars and even suits (he was rumored to own 1,000) was world-famous. A notorious kleptomaniac, Farouk once stole a pocket watch from Winston Churchill. Yet of all Farouk’s collectibles — like stamps, art, cars, antiques, clocks and even pornography — the king’s most famous assortment was rare coins. Comprised of nearly 9,000 coins (including a 1913 Olsen Liberty Nickel, a 1933 Double Eagle and a South African Single 9), most of his collection was amassed by exploiting hard-hit Americans who were desperate for cash during the Great Depression. Yet Karma never fails to be a you-know-what, and when the king was exiled to Monaco in 1952, all of his prized possessions — including his many coins — were auctioned off, and the revenue deposited into the national treasury.
• 1851 $50 Gold Coin - This octagonally-shaped coin was minted in San Francisco by United States Assayer, Augustus Humbert. Today, the coin is worth around $50,000.
The majority of Farouk’s collection was sold off during the Palace Collections of Egypt auction, held in February of 1954 in Cairo. The Egyptian government, clueless about the value of the coins, sold most of them in lots for less than 10 percent of their worth. This must have been a crushing blow to the failed ruler, whose collection would be worth more than $150 million today.
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S E C T I O N N A M E | Story Name
Birth of the Grading Scale Famously (or perhaps infamously) known for his Ivy League Nude Posture Photos — a group of photographs taken between the 1940’s and 1970’s, brandished as a study on rickets, scoliosis and lordosis, but widely believed to have been an attempt to support his theory on body types and social hierarchy — William Herbert Sheldon, Jr (18981977) was an American psychologist.
Because the condition of a coin is so integral to its value and collectibility, Sheldon’s scale may be one of the most important benchmarks in the study of numismatics.
He was also a numismatist.
A psychologist first, Sheldon surely understood the human psyche. As a numismatist, he understood the value of a rare, exotic or historic coin. And as both, he recognized the human drive to possess a tangible connection to history — to own a great work of art, no matter how small. He knew the yearning we all have to achieve greatness. And to live like kings.
In 1949, Sheldon devised a 70-point system called the Quantitative Scale for Condition that would forever change the way a coin’s condition was measured.
Surely, the mastermind behind the scale used worldwide to evaluate one of the most popular collectibles in history understood the awe a rare coin strikes in the heart of men.
Though the scale was tweaked by the American Numismatic Association in the decades after its inception, the Sheldon Scale is used for coin grading to this day, namely by the Numismatic Guaranty Corporation and the Professional Coin Grading Service — two of the most trusted third-party grading services in the world.
After all, it’s been happening since the beginning.
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“There are those much more rare people who never lose their curiosity, their almost childlike wonder at the world — those people who continue to learn and to grow intellectually until the day they die. And these usually are the people who make contributions, who leave some part of the world a little better off than it was before they entered it.” ~William H. Sheldon
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S P E C I A L F E A T U R E | Counterfeiting
Why LBMA and Good Delivery are Important By Richard Alexander Rogers
T
hese days at the Olympics, despite a literal world of disparate cultures competing, each with their own unique customs and habits, there is a winning celebration that has become almost universal. After the medals are passed out and the anthems played, as hundreds of camera lenses turn towards the podium, the athlete (or team) at the top raise their gold medal to their mouth and smile. And then they take a bite.
The bite-down is of course a reference to what, at least according to television, was the preferred method of gold testing in the old west. You know the scene: somebody offers the dusky gunslinger a job, dusky gunslinger demands payment in advance and, taking a gold coin (Spanish doubloon?) out of the leather pouch, chomps into the coin with his teeth to make sure it’s not bogus.
It’s a charming move that manages to tread the space between too boring and too flashy. But for players in the precious metals game, it can be seen as a bit reminiscent of a danger that bullion investors must be aware of. And while it may also seem a bit silly, the peril of counterfeit coins and bars is very real even today.
Despite being a centuries-old method, it would actually have been fairly able to detect the most common methods of faking authenticity. Since gold is a relatively soft and malleable metal, a gentle bite into the center of a genuine coin would provide a little bit of give and may even leave indentation on the coin while a painted disc of iron would feel very different. Another method of
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Counterfeiting | S P E C I A L F E A T U R E
counterfeiting that also reaches a long time back was called “nickel plugging.” Here, a skilled culprit would have removed the coins “plug”-- usually silver-- and either replaced it with less valuable metal or simply resurfaced the coin hoping nobody noticed. As you can guess, a good chomp would be a solid defense against this as well. As would the very real threat of being shot in the desert, one must assume. At this point in the article it is a writer’s legal responsibility to tell the reader, perhaps unfortunately, that we have progressed to a day and age where you are strongly discouraged from shooting dead anyone who sells you bogus goods. That said, there are still plenty of counterfeiters using these methods today. These days the “paint job” method is certainly the easiest to sniff out. Every kind of bullion imaginable from 5-gram gold bars to silver kilogram ingots, from American silver eagles to cartoonishly large
Because different metals are have different densities, it’s very difficult to replicate the correct weight if the bullion is entirely counterfeit. gold bricks have been -- and are being -- counterfeited simply by applying a thick coat of paint to a less-precious metal that has been molded into the correct shape. In person, the weight of the material will always be the best giveaway for this kind of forgery. Because different metals are have different densities, it’s very difficult to replicate the correct weight if the bullion is entirely counterfeit. Always verify the weight of any loose bullion that you purchase, the correct mass can be easily found online. Especially for coins and other small
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S E C T I O N N A M E | Story Name
pieces, it is also useful to keep a small magnet handy as pure gold is not magnetic. (The best place to buy the correct magnet will be a hardware store, as the typical refrigerator magnet does not carry a strong enough magnetic force.) There are certainly other methods to immediately detect counterfeits made this way-- scratch/acid testing, drilling etc-- but with the exception of some ingots/bars these processes come at the cost of severely devaluing your own material should it prove to be legitimate.
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In contrast “plugging,” sometimes called “coring” nowadays, has made a little more progress as technology has improved. While the paint job can be used to fake most any form of bullion, plugging is most effective-- and most commonly used-- in defrauding investors looking to purchase large bars of gold or silver. The standard method these days begins with counterfeiters drilling (or coring) out the center of the bar, lengthwise, from one end. They then extract the core-- pure gold-- and replace it with another metal of similar density,
Counterfeiting | S P E C I A L F E A T U R E
Buying bad bullion can often be avoided simply by checking the correct weight of the material according to the official mint or manufacturer. usually tungsten or lead. Finally, a small amount of pure gold is melted over the holes that drilling the bar created. While the weight of these tampered bars can often be very close to the correct mark for genuine bars (particularly if tungsten is used to fill the center,) the de-valued bars are usually off by several grams on either side. Once again, buying bad bullion can often be avoided simply by checking the correct weight of the material according to the official mint or manufacturer. Broadly speaking, there are several ways to demonstrate the validity of any coins or bullion one is considering buying from
a vendor. Unfortunately, the most effective methods involve damaging or at times completely destroying (by melting) the product which can severely devalue your investment. And whatever new techniques may come along for combating counterfeiting-- just like the constant fight to prevent blood doping or PED use in athletics-- the cheaters will always be one step ahead of the game. It seems bleak, doesn’t it? In reality though, there is one foolproof way to be certain of the material you’re buying: only by from established, reputable producers with a verifiable history. While individual investors will generally be priced out of buying bullion directly from the refiners themselves, as long as good common sense is applied when finding a bullion retailer to do business with then an investors next priority should be to ensure they are buying either sovereign bullion from major government mints or bullion bars minted by a well known refiner.
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S P E C I A L F E A T U R E | Counterfeiting
More expensive? Sometimes. Worth it? Always. An individual investor can certainly take some time researching several refiners, asking around to suppliers and other interested parties about which product to buy. Alternatively, an individual investor really only needs to consult one list: the LBMA Good Delivery List. As these pages have certainly discussed before, the LBMA Good Delivery standard is unmatched in global bullion dealing. When buying clean material produced by this select group of refiners, found worldwide, an individual investor can carry the same confidence as a bank when purchasing bullion bars or rounds.
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Because of the stringent process and testing required for a refinery to achieve Good Delivery status, every bar they produce will have a uniform appearance down to the color, weight, and texture of the bar. Certainly the designs and/or stamping will be identical, allowing you or your broker to discern quickly whether any given bar is the genuine article. When dealing with smaller bars, LBMA Good Delivery producers often pack the bars individually in tamper-proof “certi-cards.� If the package is intact, you can be certain that the bar is the real deal. These top of the line refiners also take their reputation particularly seriously, and are actively searching for any reports of counterfeit material attempting to copy their material.
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S E C T I O N N A M E | Story Name
GEEK INVESTING T
hey say the meek shall inherit the earth. Well, it’s too late. The geeks already have. With the IT and video game industry raking in billions of dollars, it’s no surprise that the men leading these companies may be a little on the geeky side. I don’t think Bill Gates or Mark Cuban would insist that they are the coolest guys around. Heck, who doesn’t have a little geek hidden inside? Your odd collection of Pez dispensers that sit on your desk, or your affinity to anything that has Superman on it, are sign that you may be a closet geek.
By Jason Vaile
Old enough now to appreciate it even more and keep it in the pristine condition that other collectors covet. More and more nostalgic toy shops are popping up around the country to cater to just those investors. Shops that carry unopened mint condition boxes of toys that date back to the 60’s. The secondary market on these geek investments continues to grow, and so do the numbers of collectors.
COMIC BOOKS Comic books were originally worthless pulp sold in drugstores for a dime in the 1930’s and 40’s. Millions of each issue were printed, read, then passed around to friends and eventually thrown away. A few people collected them for pleasure, but not many. It wasn’t until the 1980’s that collecting comics was actually thought of as a sound investment.
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Investing for Geeks | S P E C I A L F E A T U R E
In 1974, you could buy an average copy of Action Comics #1, the first appearance of Superman, for about $400. By 1984, that same comic cost $5,000. At the end of the 1980’s, auction houses like Sotheby’s and Christie’s began auctioning comics. In December of 1991, a Detective’s Comic #27, the first appearance of Batman, sold for $55,000. A few months later, an Action Comics #1 auctioned for $82,500. Comic collecting was now a hot market.
Disney wanted. The toys, the merchandise, the theme parks, and the multi-billion dollar film franchises.
Comic Book Eras Comics have evolved over the years. They have a rich history that reflects the culture and times of America through their pages. The different eras of comics are defined by their ages.
The Golden Age (1938-1945) At the investment level, high-value comics were appreciating at an amazing rate in the 1990’s. Comic book shops were popping up all over the nation. Even new comic releases saw giant value jumps shortly after hitting the market. One that sold for sixty cents could often fetch 1000% return after just a few months. The comic bubble burst in 1993. Marvel, one of the comic giants, was facing bankruptcy. Even the value of classics like Action Comics #1 and Detective Comics #27 plummeted. The market had become oversaturated with over-priced comics, which turned off both collectors and investors. New sales dropped 70%. In 1996, Marvel filed for bankruptcy.
The comic market has recovered and is beginning to thrive again. Some Golden Age comics are creeping into the six-figure range. The price of high-value older issues continue to rise. In 2010, comic book sales started breaking records. That same year, an Action Comics #1 sold for $1 million and shortly after a Detective #27 for $1.075 million. The comic geek was reborn. In 2009, Disney acquired Marvel for $4 billion. The comic book industry had not recovered that greatly, it was the comic book properties that
American readers took interest in the funny pages printed in newspapers and magazines. Collections of these were published, but were made up of just reprints. As demand grew, publishers needed original material featuring the audiences favorite characters. The new comics were pitched to adolescent boys seeking adventurous heroes. Other issues were targeted at an older audience with racy, pulp fiction stories. In 1938, Superman was born in the pages of Action Comics #1. He ushered in a new era of superheroes. In 1939, Namor and the Human Torch were created. Shortly after, Captain American, Batman and Wonder Woman lept off the page and into the history books. The superhero formula was now finding its place, and publishers began making a fortune off books that cost only a few pennies to produce.
Most valuable comics of the era: Action Comics #1 and Detective Comics #27 - $2.1 Million (each)
The Atom Age (1946-1956) Fredric Wertham M.D. almost brought about the end of comics. His book, Seduction of the Innocent, blamed comics for the delinquency of all children. He even claimed Batman and Robin were pushing a homosexual agenda. This led to neighborhood comic book burnings. www.ahametals.com American Hard Assets | 29
S P E C I A L F E A T U R E | Investing for Geeks In order to fight these accusations, the Comic Code Authority (CCA) was established in 1954. This was a self-policing and censorship code created by the comic book industry.
Most Valuable Comic of the era: Green Lantern #76 - $37,000
The Copper Age (1984-1992) The market was flooded with independent comic book publishers. Most of these books were in black and white and published on very poor quality paper. A few of these hit their mark with fans though, including Teenage Mutant Ninja Turtles, Hellboy and Sin City.
Most Valuable Comic of the era: Fantastic Four #1 - $105,000
The Silver Age (1957-1969) In this era, both DC and Marvel were completely revamping themselves. Times were changing and the old heroes that had become so well-known had to be reinvented for a new generation. DC gave more modern backstories to their heroes. Marvel was relatively new, and gave most of their heroes powers that were derived from some sort of radiation exposure. Hulk was powered by Gamma radiation. Spiderman was bitten by a radioactive spider. The X-Men were the children of the atom.
The darker, grittier comics were also appealing to the reader. Both Watchmen and Dark Knight thrilled fans with a scarier world that their heroes could inhabit. At the end of the Copper Age, gimmick covers were flooding the shelves. Silver foil, multi-layered die cut covers, and even holographic images allowed publishers to pander to the quick sell.
Most Valuable Comic of the era: Teenage Mutant Ninja Turtles #1 $15,000
The Modern Age (1992-Present)
Most Valuable Comic of the era: Amazing Fantasy #15 (First appearance of Spiderman) - $1.1 Million
The Bronze Age (1970-1984) In the 1970’s, comic book shops began opening around the country. This allowed the industry to reach costumers directly. It encouraged the idea of collecting rare and valuable comics. It even sparked the idea of comic book conventions.
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This era began with a death. The death of Superman. This comic caused thousands of people to flood local comic shops to see how Superman died. But as quickly as the new fans appeared, they disappeared, and many comic shops with them. Japanese comics, or Manga, were becoming their own niche market. Hollywood discovered that comic book movies could be quite profitable, and comics began tying in story lines to films to draw in new fans. Most Valuable Comic of the era: Walking Dead #1 - $11,300
Investing for Geeks | S P E C I A L F E A T U R E
ACTION FIGURES The most compelling reason to collect toys is simply because you love them. Usually one’s inclination to collect toys is connected to childhood memories. The toys you played with or shared with your friends, the great movies you saw and then played with the toys. Somehow action figures have a magical way of bringing back those great moments and helping to recapture that youth.
Mego’s cost-effective production of these action figures added to their bottom line. Using the same bodies on all of their figures, they simply changed the heads and costumes . This allowed them to mass produce these lines very easily. Mego also created the Kresge-style packaging that most action figures still use. It features a cardboard back and a clear plastic “bubble” that contained the figure.
G.I. Joe The “Moveable Man of Action,” or what we know today as the “action figure,” was the brain child of Stan Weston. His idea derived from the huge success of the Barbie doll, introduced by Mattel in 1959. Weston was watching a late night movie starring Robert Mitchum and Burgess Meredith when the name came to him. The film’s title was “The Story of G.I. Joe.”
In 1976, Mego rejected a deal to license figures from a small upcoming film called Star Wars. The deal seemed of little consequence when their rival Kenner got the contract. Mego filed for bankruptcy in 1982. Mego action figures now sell for about $2,000-2500. Their original sales price was $2-3. Mego produced an elastic Batman to compete with Stretch Armstrong. There are only two mint condition Elastic Batmans known to exist. These sell for about $40K each.
In 1964, the GI Joe action figure hit the shelves. It was articulated in 21 places and had a scar down the face to keep it from people calling it a doll. Purely by accident, the thumbnail was manufactured on the wrong side of the thumb. They later used this defect to protect against copyright infringement. In 1983, the federal law prohibiting the creation of children’s programming based on toys was lifted. Backed by an animated TV show and comic books, GI Joe resurrected its franchise in 3 3/4” glory. The prototype GI Joe toy soldier sold on Ebay for $200,000 in 2003. In the 3 3/4” line, G.I. Joe created a transforming series called “Manimals.” Although manufactured, the toys never made it to market. One of the Manimals, the “Vortex MDC,” sold for $20,000.
MEGO
Star Wars In 1978, the oil crisis led to a jump in the price of plastic. Most toy companies discontinued the 8” figure line and Kenner introduced 3 3/4” figures based on Star Wars. Unable to meet demand for the toys, Kenner issued “Early Bird Certificate Packages.” These could be mailed to Kenner to get four Star Wars action figures. The box also contained a diorama display stand, some stickers, and a fan club membership. These certificates with unopened figures now sell for around $3,500.
The Mego Corporation was founded in the early 1950’s and made mostly dime store toys. In 1971, Mego purchased a variety of licensing rights: Star Trek, Planet of the Apes, DC and Marvel Superheroes were just a few of its hugely successful franchises. GI Joe sales were falling in the 1970’s, while Mego was skyrocketing.
Throw the name Star Wars on something and it’s like printing money. Last year alone, the franchise raked in $3 billion in licensing revenue. Over the franchise lifetime, it has totaled $20 billion in licensing revenue, on top of the $4.4 billion in tickets and $7.8 billion in home entertainment products.
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S P E C I A L F E A T U R E | Investing for Geeks
Fox let George Lucas, creator of Star Wars, pass up an additional $500,000 directing fee in return for keeping licensing and merchandising rights for himself, a decision that would end up costing the studio billions. Lucas sold toy merchandising rights to Kenner in advance of Star Wars opening for a flat fee of $100,000 after Mego turned him down. By the end of 1978, Kenner had sold more than 40 million of the figures for gross sales revenue of more than $100 million. In 2004, Forbes estimated George Lucas’ worth at about $3.2 billion.
2. Vinyl Cape Jawa, 1978
The original Jawas had a thin plastic cape. The second wave were outfitted with a sewn cloth cape. Kenner was worried about perception of value when customers were getting a figure half the size for the same cost. Value: $2,000
1. Telescoping Lightsaber Darth Vader, 1978 The original “early bird” Darth Vader featured a light saber that telescoped out of his arm. These proved too difficult to produce and a second wave of single piece light sabers were made. Only a few hundred of this original design were made. Value: $6,000
THE INACTION FIGURES
Top 5 most valuable Star Wars Figures 5. Blue Snaggle tooth, 1978
Some collectors are rallying behind a new breed of collectible figures. These figures are based on real, historical people who aren’t necessarily superhuman. Some of these inaction heroes include, U.S. President Barack Obama, astronaut Buzz Aldrin and (who could forget) Prime Minister Sir John A. MacDonald (Who?). Typically retailing for more than $50, these figures are clearly beyond the reach of the typical kid’s allowance. Instead, they’re being snapped up by an eager community of collectors and enthusiasts, most of whom are in their 30’s and 40’s and grew up with Star Wars figures and G.I. Joes.
Kenner toy designers only had a small, grainy black and white photograph to design the prototype of the Snaggletooth figure. As a result, they got his color and size completely wrong. The figure was quickly scrapped, and is now one of the most rare figures on the market. Value: $400
4. Yak Face, 1985
In 1985, Kenner cancelled production of the Star Wars figure line. One last figure was produced, but never distributed in the United States. Some Yak Face figures were shipped to Europe and Canada, but never in the U.S. Value: $1,000
The inaction figures have evolved into an art form, with highly detailed dolls that are more statuettes than play things. Collectors will seek out models of people with whom they have a “visceral” connection. A Hong Kong company, In Icons, has been abuzz around the market with their new 12-inch pose able doll who looks eerily similar to the late, great Apple founder Steve Jobs. Original pre-orders sold for $135, but when Apple lawyers made them shut down production, the on-line prices skyrocketed to more than $3,500.
3. Rocket Firing Boba Fett, 1980
The original version of Boba Fett featured a rocket firing back pack. When Kenner began to worry about the safety of the firing projectile, they permanently glued the rocket in place when they were shipped. Value: $2,000 So feel free to get your geek on and buy that piece of nostalgia that will make you feel like a kid again. Remember, the only thing that separates the men from the boys...is the price of their toys. 32 | American Hard Assets www.ahametals.com
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S E C T I O N N A M E | Story Name
Busting the Myths in Sports Memorabilia I
By David Sliepka
nvesting in sports collectibles and memorabilia is dangerous due to rampant fraud, and counterfeiting. In this article, I will explain why this and many other myths should be strongly examined before you put your money in ANY long term investment like sports cards. If you must answer that statement with a simple true or false, the technical answer is true. But at the same time, you would have to say the same thing about precious metals and stocks. If you are a life-long investor in metals, you may scoff at that comparison because you know your way around that business. You know the legit companies, and you know if something is too good to be true, it likely is. Fact of the matter, investing into any area you are not familiar with is dangerous due to the unsavory elements in any business, not because that business is inherently bad. Should you invest in memorabilia? The answer is not a yes for everyone just like it’s not no either. For those that have a passion for sports, the history, the numbers analysis, and the pure joy of hunt,
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sports investing can offer a unique collecting experience, and a great piece of nostalgia to your portfolio. Let’s examine some myths.
The bubble burst on sports collectibles in the 90’s. No one collects any more. In fact, there was a huge bubble that did burst in the 90’s in sports cards. At its height, there were nearly 20 card companies were producing hundreds of brands of sports cards each year. Fans just could not get enough. Some vintage rookie cards were starting to sell at record numbers, and the media latched on. Everyone thought that since a Mickey Mantle Rookie card sold for $25,000, I should by 100 of the next big rookie. Investors rushed in and were buying up cases upon cases of cards as a nest-egg for their kids’ college fund. Seemed like a good idea in 1991 when seemingly all prices were rising. But it was a classic bubble, and a borderline pyramid
Busting the Myths in Sports Memorabilia | S P E C I A L F E A T U R E
Sports card shops are only there to sell me stuff and rip me off. In the mid 1990’s it was estimated that there were over 5,000 full time card shops operating in the U.S. Today, there are likely less than 600. The good news about that number, the cream has risen to the top. Those that have survived typically have done so with a level of knowledge and experience that can benefit the modern buyer. Tap into their knowledge. Yes, they want to sell you something. But more than that, they typically want to earn a long term customer. Proceed with caution of course, but know that if they are operating in today’s shrunken business, they likely know what they are talking about.
The market has shrunk. There is no money in it any more If you are talking about modern made baseball cards, there is fact in that statement. If you are talking about overall dollars pumped into sports collectibles each year, you might be surprised what is happening under the general public’s radar. Full-time auction houses are the life blood of the high end sports collectibles business. More than the blood, it’s really the heart. Major businesses like Heritage Auctions, Robert Edward Auctions (REA), Sotheby’s, SCP, Golden Auctions, Grey Flannel, Lelands, and many others pump out hundreds of millions of dollars in collectibles sales each year. A most recent auction in April of 2014 by REA produced sales of over 8.25 million dollars alone. This is actually down from their 2013 sale scheme. Just a few years later when those same collectors tried to sell some of those cases they found buyers were few and far between. Why? Because prospective buyers already had their own cases, and going rate was not much over what they bought them for. Those who really needed the money more than they wanted to hold on to the cards for another ten years started to sell at below market, and down went the prices. $250 cases could be had for $150, and now, 20 years later, some of those $200 investments are worth about $50. One of those Rookie Cards “investors” went after was Frank Thomas. He was a sure thing. Sure to be one of the best hitters ever, and a certain 500 home run club member. And then, a Hall of Famer. Well, 20 some years later, all those predictions came true! Unfortunately, back then his cards were going for about $4 each. And today, you can still find them for $3-5. They just made too many. 80% of “collectors” who jumped in the market in the 90’s are gone. A wise person once said, “Something made to be a collectible rarely is.” The astute collectors who were around back then, and likely still around now were not buying the modern creations. They were buying the true blue chips of the hobby. “Old cards”, Game worn memorabilia, unique collectibles from the 50’s. Newcomers to the hobby think the boom of card production began in the early 1990’s. Reality is it was more than ten years before that. If you look for them, there are no shortage of cards from the 70’s and especially 80’s. If you call a local card shop today, (if you can find one in your area) and ask them what they are buying, they will likely tell you “Pre-1970 cards.” Majority of cards after then were produced in too high quantity to matter much.
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S P E C I A L F E A T U R E | Busting the Myths in Sports Memorabilia
of over 10 million dollars. Some simple math done from just these top auction houses tell us an annual sales revenue of top end collectibles could surpass a half-billion dollars. It is important to note, these auction companies typically are reserved for the industries premium items with values starting a $1,000 or more. The vast majority of their items sold date before 1960. You won’t find a $250 signed Nolan Ryan photo there. To meet the needs of the mid-range, and lower end collector, there are too many auction companies to mention, including online giants eBay and Amazon.
There is nothing left in attics any more. Everything good has been found. Probably the easiest claim to debunk. When you think of the age of a house before it’s torn down, we are typically looking at over 60 years. For those sturdy, well-built brick beauties of the 20’s and 30’s, they are lasting 100 years and more. To cut to the chase, new found treasures are turning up every year. In just 2012, there was an historic find in Defiance, Ohio. Dubbed “The Black Swap find” for the region of that state it was found, over 700 rare cards from 1910 were uncovered. They were not just old but in shockingly pristine, many like new condition. In mid 2013, Dallas-based Heritage Auctions dispersed them at a major event at Camden Yards in Baltimore. The auction generated over $566,000 for just this find alone. In 2008 Robert Edward Auctions sold a small collection of tobacco cards found in a Florida attic earlier that year for over $370,000. Included in that find was the hobby’s “holy grail”, a T206 (catalog designation) 1910 Honus Wagner. Graded only a 1 (poor) by Beckett Grading Service, this card alone generated $317,000. If you are unfamiliar with “The Wagner” as it is known, it is the most legendary card in the hobby. The story begins with the limited number of these cards released to the public. Legend has it that Wagner wanted his card pulled from the 1909 insertion in cigarette packs do to his objection
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with having his image associated with the sale of tobacco, and potentially to kids. There are just as many out there who believe it is as likely he felt he was not compensated enough to appear on cards, and demanded his cards be pulled. The mystery behind the story only adds to its legend. Fact or fiction, the reality is there are likely no more than 60-70 of that card known to exsist. And again touching on the all-important condition issue, very few can garner even a grade of 5 on a 10 scale. This fact came to the fore front again in the mid 1990’s when one of these cards became the first card graded by fledgling grading company PSA. Graded an 8, the hobby, and collecting world was abuzz. Doubts of its legitimacy existed from day one. This did not stop it from it once being owned by LA Kings owner Bruce McNall and hockey great Wayne Gretzky. It became the hobby’s first million dollar card. It was later issued in a promotion by Walmart. It has since been resold numerous times including a rumored sale to actor Charlie Sheen. In 2011 it was sold to the owner of the Arizona Diamondbacks for $2.8 million. It is important to note the numerous sales add a tremendous sales track record to this legendary card. With an initial sale to Gretzky for just over $400,000, each successive sale the card has increased in value by a significant percentage. Same can be said for virtually every example of this card. At one time it was unheard of for a card grading a 1 on a 10 scale to sell for $100,000. For the Wagner, this was a regular occurance in the early 2000’s. Now, a quarter million dollars MIGHT get
Busting the Myths in Sports Memorabilia | S P E C I A L F E A T U R E
And finally Pete Rose is an interesting case. While no one is out there signing more autographs weekly than Rose, demand continues to meet his machine-like production. His high visibility has raised awareness, and value of his game-used collectibles, as well as his early baseball cards. His first card was issued by Topps in 1963, and high grade examples will now run you from $3,000-$4,000. An investment in these cards just 10 seasons ago would have resulted in a nice little 25-30% profit today.
Values have topped out. There just isn’t enough market activity. I think I first heard this when the Wagner card surpassed the half a million dollar mark. Now the expected next sale will be over 3 million. One thing about collectibles that are attached to people is: things change. People die, records are broken, and we all get older. The current generation of collectors that grew up in the 70’s and 80’s has, at times, sometimes grown jaded. We have been spoiled with the vast majority of the greats of the games living in our midst. Mickey Mantle, Joe Dimaggio, Johnny Unitas, Bob Feller. These and many other legends spent their golden years signing autographs at trade shows around the country. Their availability was deceptive. What appeared to have been an over-supply of their signature on the market, in many cases has been outstripped by the demand for these items.
you a Wagner that is torn in two pieces. And as a side note, former auction house operator Bill Mastro was recently convicted on federal charges of trimming (smoothing the edges) of that top graded Wagner card, and defrauding the public by its sale through his auction house. He is awaiting sentencing as we go to press, but this has not fazed the interest in this card in the least. If it entered the market today, a $3 million dollar price tag is virtually certain.
The only things worth investing in are Hall of Famers For the most part, buying in to Hall of Famers is wise. But limiting to only that is missing some key opportunities. Three of the most desired players right now may never see the Baseball Hall of Fame in Cooperstown, New York. These are “Shoeless” Joe Jackson, Roger Maris, and Pete Rose. Jackson was banned from baseball from the infamous Blacksox Scandal of 1919. In short, there were very few collectibles made with his image. Anything original from his time period is in high demand, and only continues to grow. Sales in recent years of his key baseball card from 1910 exceed $200,000. Roger Maris is a Yankee legend for his historic Home Run chase of 1961 in which he hit 61 home runs. That record was surpassed more recently by Mark McGwire and Barry Bonds. While suspicion of steroid use has tarnished those records, collectors have turned their attention back to Maris. Veteran collectors still hold him (and Hank Aaron) in the highest regard as the true home run kings, single season and career respectively. A high-quality single signed baseball of Maris can easily bring over $8,000, when just over a decade ago these could be found for a mere fraction of that. Aaron balls on the other hand are quite available for $150.
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S P E C I A L F E A T U R E | Busting the Myths in Sports Memorabilia
In very short order we will lose Gordie Howe, Muhammad Ali, Willie Mays, Sandy Koufax, Hank Aaron, Bobby Hull and others we take for granted. Collectors have learned from past results, values of their signatures have already begun to climb. And in the case of Koufax, sky-rocket! Autographed balls by Koufax were readily available just a few years ago at $125. Now, going rate is $200-$250 or more. The shrewd collectors have begun to put away the premium items of these icons. The most desired include game worn items, player documents and contracts, and premium autographs in limited editions. As mentioned earlier, the Wagner card was not always top of mind as it is in the hobby today. There seems to be an increasing interest in other stars, and their cards from the early 20th century. Because cards were not produced every year, and by the same company, it was harder to define a players first card or “Rookie Card”. Babe Ruth is one example of that discussion. It never really mattered much, as any Ruth card from his player era was a serious collectible, that consistently gained in value. In recent years, one card has risen above the rest. The 1914 Baltimore News issued card of Ruth was a hobby oddity. Its perception as a “real card” or just a newspaper issue were often debated. Of late, it seems, it just doesn’t matter how it is designated, they just want it. Again, demand 38 | American Hard Assets www.ahametals.com
is far outreaching supply. The card just doesn’t come up for auction very often. In fact, less than one per year on recent average. The one that sold last year, a grade of a 1 “poor”, reached $450,000. Because of the demand, because of the stature of player, and because of the unknown, but certainly minute supply, the next sale of a 1 in July of this year is expected to easily reach $500,000, and in all likelihood $600,000. Now, if you bought the one that went for sale in 2007, you could have had it for under $200,000. And that was a “2”! Are there less of this Ruth card than there are The Wagner? Almost certainly there are. Most experts aren’t talking about his though. They are just out there looking for one! If another is found, in say, a grade of a 5 or a 6, expect to see our next million dollar card. So in short, collectibles investing is not for the uneducated or the faint of heart. It’s also not the business it was last time you looked into it 20 years ago. There are multiple card grading services as well as autograph authenticators. If you are uncertain of a purchase, rely on a third party authenticator you can trust. It’s no longer the wild west of the early 1990’s. If you are thinking about getting involved, visit your local card store. Look up an auction house and request a catalog or browse their internet offerings. Or if you are really serious, The National Sports Collectors Convention comes to Cleveland this year, July 30 – August 3, 2014. NSCCSHOW.COM
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H A R D A S S E T S | Buying Metals at Auction
Buying Bullion at Auction
By Hayden Tubbs
Finding Metals on eBay
M
any people still view eBay as “the online auction site� where you can find everything from antique toys to pieces of toast with the image of Bob Marley. That is not to say that you cannot still find these quirky things on eBay, but the site and company have matured to become one of the most prominent online marketplaces in the world. Perhaps the most noticeable representation of this is the eBay Bullion category. The bullion marketplace on eBay has grown by leaps and bounds in the past few years to become what many consider to be a premier source to buy bullion. Nearly every bullion product is available from generic silver bars, new silver coins from around the world, PAMP gold bars, Rhodium bars, silver eagle monster boxes,to brand new US Mint sheets of 2014 1 Oz Gold Buffalos-most at fair market pricing. Combine this with the ability to use one login to track & purchase these products on your desktop, laptop, or mobile device while keeping your personal payment information secure and you have marketplace that will keep buyers coming back again and again.
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Buying Metals at Auction | H A R D A S S E T S
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H A R D A S S E T S | Buying Metals at Auction
If you had asked me five years ago if eBay would become a driving force in the bullion marketplace I might have given you a funny look and laughed. eBay has always been an active source for collectible coins but at the time bullion and eBay were not conducive to the buyer or the seller. eBay had attempted to break out into this marketplace in the past, but this was considered by many to be a failure.
the opportunity to keep track of new product availability as easy as checking what new items are active on eBay from their favorite bullion sellers.
There was missed opportunity here and finally three years ago, smart minds at eBay prevailed. They saw the potential for a one stop shopping experience for bullion products online. One thing they recognized was a need for strong industry partners to not only bring a large variety of inventory to the table but to also have a strong fulfillment capability and a positive customer experience. ModernCoinMart (MCM on eBay) was one of the first partner eBay tapped to bring bullion en masse to the site. eBay has since added additional top market dealers to their exclusive group of partners. This arrangement not only guarantees a large variety of products but also healthy competition on overlapping products. All of this makes for a very buyer privileged market.
eBay offers the ability to see side by side pricing from multiple sellers at once; an invaluable tool for savvy consumers. Buyers can also sort within categories by weight, purity, and brand to refine results. As a rule pricing from the top sellers in the bullion category is on a live feed also known as dynamic pricing and will generally mirror their website credit card pricing.This provides assurance for buyers in knowing that in most cases they can pay the same price regardless of which buying avenue they choose.
The healthy competition between sellers also ensures that eBay has new products listed soon after release. This gives buyers
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In the same way that eBay sales have determined the market value for many collector coins, premium bullion products have also begun to be priced according to eBay market trends.
While any buyer can feel perfectly safe buying from one of eBay’s trusted sellers, the eBay marketplace still offers a wide variety of products from small and mid-level sellers. Buyers should always exercise caution when buying from an unknown source, but eBay has gone to great lengths to offer protection from fraudulent sellers and counterfeit items. eBay has worked to clean up the Bullion category by banning the sale of replica and “copy� items along with
Buying Metals at Auction | H A R D A S S E T S
the infamous gold & silver “clad” bars offered by unscrupulous sellers. eBay is working to prevent fraud before it even occurs and has taken action quickly against counterfeit items when alerted by industry professionals. Even with these changes it is impossible to catch every crook and eBay’s chief protective tool for buyers is the eBay Money Back Guarantee policy which covers all bullion purchases. This policy guarantees that you will receive the item you ordered and protects you from items that are not as described. In the unfortunate event that a crooked seller was to take your money and run or ship you a counterfeit item, eBay will cover your purchase in full. It is important to note that like any purchase from any bullion dealer all sales are final and items cannot be returned due to price fluctuations or because you changed your mind. With that said, if you feel that the item you received is off quality, contact the seller. Most will gladly provide an exact replacement.
Sellers have countered this by offering lots, rolls, and boxes but this can only go so far. For those buyers looking to make serious high dollar purchases at the lowest price, the best option is still to buy direct from a well-established, known, and trusted source for bullion. As eBay is able to implement these kinds of changes, they truly stand to become an even greater one-stop source for bullion online.
While eBay has made substantial progress in creating an active and safe marketplace for buying bullion there is still improvement to be made. There is always more that can be done to prevent fraud, especially when you are dealing with a product that can be easily converted into liquid funds. Drawbacks include the lack of the ability to offer large quantity discounts or allow select vetted sellers to accept wire transfers.
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S E C T I O N N A M E | Story Name
On both sides of the handle one can find barely detectable panels called Pocket lockets originally design by Joe Kious to hold medication. As one slides back the panels they reveal even more masterful engravings.
knifepurveyor.com The power of the knight pictured within can clearly be felt through the forceful outlines of the piece accented with the foreboding colors, war is coming.
By Abe Elias
A
rtists choose to work in many different mediums and as the human spirit is limitless, so too is the desire for expression. For high end custom knife makers, their art is a masterful collaboration between the natural and the fabricated. In their desire to create what is in their mind and soul and display it to the world so that other people may understand, knife makers draw on a variety of materials and skills. Steel and machining techniques are taken from the world of technology, while fine materials like gold, mother of pearl and antique ivory are drawn
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from the realm of Mother Nature. Shaping these mixed materials into one of mankind’s oldest tools with exquisite detail and finish is no less a labor of love than any other art form. Over the past decade, the appreciation for such an art form has grown and with it the value of the art it produces. The knife as a form of art is not only pleasing to the eye but mesmerizing to the touch. To feel and interact with such works draws you into the maker’s desire to perfect their piece. The subtle qualities of a smoothly opening blade or the crisp engagement of the locking mechanism all add to the appeal of this form and
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Even with the Geisha’s eyes closed we are able to peer into her sole and feel her innocence due to the masterful engraving of Simonne Fezzardi.
knifepurveyor.com “Beauty of Innocence” clean crisp lines and the use of light bring out the organic flow of this piece. The gold inlay and Blacklip Tahitian pearl bring subtle color to the purity of the steel.
drive the collectability of such works. Few makers are capable of the level of skill coupled with creativity to accomplish work worthy of the discerning investor and collector. Much like in the regular art world, people need guidance from dealers and purveyors to help the buyers and artist bridge the gap and become connected with a piece. One such dealer of knife art is Michael Donato of knifepurveyor.com. Thirteen years ago, Michael Donato started knifepuveyor.com after having traveled throughout Europe and Africa. While on his travels, Michael visited places such as the Louvre and Prada Casa De Greco, where he took great pleasure in viewing the entire local art culture as well as the classics contained in the museums. Upon returning home, he was taken to the New York Knife Show by a friend and immediately recognized highly crafted knives as their own form of art. All they were lacking was someone to connect those who would appreciate them to those who create them. Shortly after, Michael set out to deal in this highly specialized area of art and has been doing it for over thirteen years now. When I wanted to take a closer look at this area of knife making, I could think of none better suited, with more passion for the form, to show me around this highly desirable and collectable form of art. 46 | American Hard Assets www.ahametals.com
The first piece is called “The Warrior and Battlefield” by Joe Kious. Often times in the knife world we will get to see pieces derived from a culmination of various artisans’ skills, and this particular piece is a perfect example. Joe obtained Damascus steel from Jerry Rados in his famous “Turkish Twist” pattern to create the blade, which is the foundation of any knife. Next, master engraver, C.J. Cai uses 24kt gold, 22kt green gold, 18kt green gold, stainless steel and copper inlays to create a multi-toned background in which Cai would create a medieval fantasy. As with many knife pieces the artistic genius of the work lies not only in what can be easily seen. The expression can also be an execution of the perfect mechanical function of the knife and creative work such as the nearly undetectable panels, called pocket lockets, that slide out to reveal two more engravings of knights on the liners. In all, this piece is a classic both in its subject matter and in the culmination of the work of multiple masters. A knife maker may make many knives in their career, but it is rare to have the same masters collaborate on many different pieces. Joe Kious lives in Texas and has been making knives since 1969. He is nearing the end of his knife making career, leaving a distinctive mark on the knife community with his pieces. As with any domain of art collection, it is hard to imagine that his pieces will not appreciate significantly once he is no longer an active artist.
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S E C T I O N N A M E | Story Name
The gold seems to tell a story of motion and time as the lead of the flow seems fresh and vibrantly moving while the origin seems to be halted and aging.
knifepurveyor.com This piece is a Soul authorship from the talent of Dellanna. Dellana has taken great time to make the majority of the materials for this knife before then crafting them into this one of a kind piece.
The second piece is from Tore Fogarizzu and is engraved by Simone Fezzardi. As much as the previous piece can be appreciated for its complexity and detail, this piece, “untitled”, can be appreciated for its simplicity and detail. Clean lines and flawless finish are a tribute to the young innocent women pictured in Fezzardi’s drawings. If I had to give this piece a title myself it would probably be the “Beauty of Innocence”. Tore uses RWL-34 steel and 416 steel, normally thought of as cold materials, but here they instead convey the purity and youthfulness of the women. Furthering this theme, he also uses Blacklip Tahitian pearl shell and 18kt gold. The use of so few materials reinforces the overall message of the piece. The details of craftsmanship are in the subtle placement of the material and the crisp finish he brings by using a layering placement to give the piece dimension. Much like a person could find themselves lost in the beauty of the women depicted on the piece, it is easy for me to get lost in the beauty of this piece alone. Tore Forgazzi is a highly sought after artist and has a waiting list of over three years. He currently lives in Italy, as does Simone Fezzardi, who lives in the town of Brescia, known for producing the finest of Italian engravers. 48 | American Hard Assets www.ahametals.com
Next we have a piece by Dellana, also untitled. Dellana is a highly skilled artisan in many areas; for instance, she forged the Damascus used in the blade herself. The handle material is mother of pearl accentuated in gold drippings. I was drawn to this piece because of its three dimensional presence. It represents a clean traditional design lifted to a new level with the contrast of gold dripped onto the pearl handle. Dripped gold not only creates a feeling of dimension, but also of movement and time. As the fresh gold runs freely about the handle, we see at the origins of its flow signs of aging and arrest. Dallana’s piece is not only a visual pleasure but has texture that entertains the sense of touch, not something that can be said about a lot of art. The visual depth to this piece doesn’t just stop at the gold: as you look into the mother of pearl, you will see a number of colors and shapes streaming through the handle as light reveals the inner beauty of this natural material. Dellana is a member of the Art Knife Invitational (AKI) of which there is only 25 members. Having sold her first knife in 1994 she has been creating works of art steadily over the past twenty years. Women knife makers are amongst the rarest groups of makers and one can often see their work appreciate very quickly due to that fact.
Story Name | S E C T I O N N A M E
The expression can also be an execution of the perfect mechanical function of the knife and creative work such as the nearly undetectable panels, called pocket lockets, that slide out to reveal two more engravings of knights on the liners.
The second view of the women depicted on the piece seems to draw you in even more as you get the feeling that part of her inner self is now revealed to you through her gaze. The subtle turn of the body shows her willingness to share but a bit of her iner self while she still guard a bit to maintain her mystery to you.
knifepurveyor.com The lines on Mathew Lerch’s piece are crisp, flowing and direct. Direct much like the effect the piece has on the beholder reaching out to them and grabbing their attention working its way into a well of emotions.
Last, is a piece by Mathew Lerch and engraved by Jon Robyn; it is also untitled. If I had to title this piece, I would call it “Seductress” as the borders of the knife seem incapable of containing her allure. The flow of the piece is a combination between crisp geometric lines and organic curves. On the ends of the handles we have crisp diamond and triangular shapes and in between these points we see flows and curves matched only by the curves of the nameless woman depicted on the handle. Lerch uses 416 stainless and 24 kt gold along with Damascus steel in the handle and blade to create this piece. The masterful engraving of Jon Robyn depicts the woman in a serious nonobservant pose on one side, but on the other she is depicted with a playful allure. Detail on this engraving is outstanding: you can follow every line on her face, hair and dress. The blade is a classic delta shaped dagger style, with a couple of twists. The blade has a stepped bevel which provides a crisp change to the flow of the knife’s grind. As a secondary effect on the knife, Lerch has a Damascus inlay in the center of the blade using hard geometric diamond shapes. The knife’s opening system is referred to as credit card automatic with the trigger being
the sculpted butt at the rear of the handle. Mathew Lerch got his start making knives in 1992 and at one point was one of the head designers for the Harley Davidson Company. Lerch specializes in folding knives and brings his mastery of machining to its apex on the incredible fit and finish of every piece. In fact, Lerch holds the very patent for the credit card automatic design. It would be impossible to put a limitation on expression and as the knife is mankind’s oldest tool it seems only right that it should embody some of our desire for self expression. In many cases of the knives shown in this article, Michael Donato took part in consigning these one-of-a-kind creations to his exacting preference. As this collectable world grows in popularity, so too will the demand. Unfortunately at the level of talent displayed by makers in this genre of art, especially considering that some must specialize in different areas to bring forth these complex pieces, we cannot expect the supply to grow apace with the demand.
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H A R D A S S E T S | 10 Tips
10 Tips for Buying Gold and Silver at an Estate Sale
By Emily Manke
Estate sales — and even garage and yard sales — can be the perfect places to score some affordable gold and silver. So with summer here, now’s the time to strike! But knowing what to look for makes all the difference. Here are some tips for getting the most out of gold and silver buying at estate sales. 1. Estate Sale Ads Are Often Incomplete One common mistake that gold and silver buyers make when going to estate sales is only going to sales that list gold and silver items. There’s no way to know for sure what a sale will have unless you check it out. If a listing contains a number, always call and ask. If there’s no number, but a listing looks diverse and potentially lucrative, go visit. With estate sales, there are often some jewelry or other precious metal items for sale. But they’re not always listed. Grandma’s jewelry box may look like it’s not worth mentioning in the ad to the untrained eye, but to a gold buyer it could contain hidden treasure.
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10 Tips | H A R D A S S E T S
2. Jewelry Can Be a Gold and Silver Bargain When most consider investing in precious metals, they think coins and bullion bars. Obviously bullion is an intelligent investment choice. It’s rare, however, that gold buyers are able to purchase gold at anything less than market value. Here’s your chance. Used jewelry is one great way to invest in precious metals, because it’s usually underpriced. If you know the price of gold and silver, you can easily determine which pieces may be valuable. And a lot of times, the purity is stamped right on the jewelry, so look it over closely.
3. Understand the Value of Condition — and the Four Cs The condition of the jewelry isn’t that important if the value of the jewelry is in the metal. A single gold and diamond earring, for instance, might be a great score if you know the four Cs: cut, color, clarity and carats. But if you’re just buying it for the metal value, there are a few more things to consider.
4. Learn About Silver and Gold Marks Perhaps the most useful thing to do is to look for the gold or silver mark. Each country has an array of different stamps used to signify real gold and silver. It’s smart to study all the North American stamps. There are a number of websites and books that feature an encyclopedia of gold and silver stamps from all over the world. So if you find a large piece of jewelry that has a gold or silver stamp, you’re in business!
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H A R D A S S E T S | 10 Tips
5. Know Your Brands Another important factor to consider when going through estate sales is how collectable the jeweler’s brand name is. In addition to their value in metal, the right brand name can add a lot of money to an item’s resale value. Brands to look for are Tiffany & Co., Raymond Yard, Belais, andVan Craeynest. If you check popular antique jewelry auction websites and check their listings, you can see some other popular antique jewelry brands.
6. Research Time Periods and Styles Familiarizing yourself with time periods and their subsequent styling is also a good move when looking for collectable pieces of jewelry. Victorianera jewelry is rare, and often very valuable because of that alone. The style of Victorian-era jewelry is simple and sweet. Yellow gold and sterling silver were the only precious metals available for jewelry making during this time period. Art Deco and Edwardian-era jewelry are also very valuable. Both time periods feature more varied metals, because platinum and white gold came into use. Jewelry from Art Deco and Edwardian time periods isknown for its incredibly detailed metalwork. Edwardian styles are more lacy and light, while Art Deco tends to be more geometric and striking in color. Art Nouveau jewelry is seeing a large resurgence in popularity right now. The signature Art Nouveau style is whimsical and inspired by nature. Lots of animal brooches, and leafy and floral patterned jewelry can be found in jewelry of this style. Art Nouveau inspired style in both the Edwardian and Art Deco eras. Knowing the basics about dating jewelry helps a lot when looking to invest in antique jewelry.
7. Look for Estate Sales in Wealthy Areas One way to ensure the quality of the items you’re investigating is to search for sales in wealthy areas. It just makes sense that the more money people have to spend on a house in a nice neighborhood, the more money they will have to spend on luxury items. Often with middle-class estate sales, you’ll find nothing but costume jewelry. With sales in wealthier neighborhoods, though, the extravagant jewelry is rarely included. But if the collection is large enough, there are often some leftover “scraps” or just smaller pieces. These leftover pieces can be incredibly valuable. 52 | American Hard Assets www.ahametals.com
10 Tips | H A R D A S S E T S
8. Don’t Be Late! Going to estate sales to try and get great deals on precious metals is a really good idea. Unfortunately, lots of other people have the same idea. So if you show up even a little late to an estate sale, you could miss out on all kinds of valuable finds. Punctuality is always the first piece of advice any experienced shopper will tell you. And that’s because it’s true!
9. Don’t Be Afraid to Barter There are few retail experiences where the customer has the opportunity to have a say in the price. So why not give it a shot? Don’t offer anything insulting, but try offering an amount below the asking price and see what happens. Oftentimes at estate sales people are just trying to clear everything out. You’d be amazed at the prices you can get when you ask. The deals can be especially lucrative if you offer to buy in bulk.
10. It’s a Numbers Game As with most things in life, your gold buying success at estate sales largely depends on your determination. Not every estate sale you go to is going to have items worth investing in. The more sales you go to, the better luck you’ll have. Once you get a great deal on an investment piece at an estate sale, you’ll be hooked! This article was a guest piece by Bellevue Rare Coins. Bellevue Rare Coins specializes in gold buying and dealing in rare coins. They are a family-owned business located in Bellevue and Lynnwood in Washington State. Bellevue Rare Coins also buys and sells silver, diamonds, currency and jewelry. Visit us for a free evaluation.
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L U X U R Y & L I F E S T Y L E | Just Luxe
Daredevil Rare Car Collectors of Chrome Underground Give Buying Tips & Reveal Their Dream Autos By Vicki Arkoff JustLuxe
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here’s nothing like the discovery of a valuable vintage automobile to rev the engine of a serious luxury car collector, but in today’s competitive market that’s become an unusual opportunity. Enter Yusuf Johnson and Antonio Brunet, rare car dealers from Texas who travel the globe to discover automotive treasures hidden deep inside dangerous, off-the-map places. The payoff can be enormous, but so are the risks, as seen in their Discovery Channel series Chrome Underground, which follows the action as the business partners gamble — with their money and lives — in international auto archeology adventures that would make Indiana Jones proud. On behalf of their Austin-based company Motoreum, Antonio and Yusuf throw the dice by heading abroad to unusual places that other car dealers and collectors are too afraid to visit. Each week, Chrome Underground viewers can follow the car hunters as they search for vehicles and find ways to protect their cash and valuable investments from the gangs and cartels of Argentina, Brazil, Columbia, Mexico and Venezuela. How far will they go to avoid carjackings, thefts, and roadside breakdowns? For a start, they hired a bodyguard trained by the Israeli secret service, and have already made getaways by camouflaging a 1957 Porsche Speedster in a horse trailer and by smuggling a 1963 VW Kombi in a shipping crate.
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They could write a book on what they’ve learned about high-value “diamond in the rough” autos — earning five or six figure profits every sale — but instead they spoke to JustLuxe to share their insider info about collecting the best of the best.
JustLuxe: Besides risking your lives to hunt for rare cars around the world, what services do you provide to customers and who are they? Antonio Brunet: Motoreum is more like a dynamic motor museum than a traditional showroom. We buy, sell, broker and offer consultation services to investors and enthusiasts. In our Austin, Texas location we offer mechanical and restoration services. Our business is about offering the rarest and finest collector cars. We have a diverse range of clients from the avid enthusiast to the first time collector, along with investors of all types. Most recently, we expanded our services to include a collector car auction company called Motostalgia. JL: What’s your best advice for car collectors regarding how and where to buy? Yusuf Johnson: First and foremost any collector must answer an important question before buying a classic car: Why do you
Just Luxe | L U X U R Y & L I F E S T Y L E
AB: An automotive wish list is difficult to develop since beauty indeed is in the eye of the beholder, and taste in cars is as diverse as our clientele. With that being said, on the top of our wish list are rare and historic competition vehicles which are highly sought after by investors. Today’s market defines many wish lists — vintage sport cars are very popular right now. European sports cars have also gone through the roof in value with continuous six- and sevenfigure sales of Ferraris, Mercedes and Porsches. For us personally, in regards to longer term investments, we look for early 1930s American vintage cars. We feel they are currently on the lower end of their market trend and represent a great value for the investment at today’s prices. JL: Which cars in your personal collection are you most proud of? Which are the most valuable — either fiscally or sentimentally? YJ: The difficult part as avid enthusiasts and collectors is that
want to buy a classic car? Is it to drive it regularly? To show at events? To restore, either personally or by a professional? Or solely for investment purposes? Often the answers may overlap, but they will help determine how and where to find the right classic car, whether via auction, a broker, dealer or through an independent search. The one thing we definitely recommend is to invest upfront in professional advice which can save you a lot of money and hassle down the road. The biggest mistake is to purchase a classic car without proper guidance, which often times leads to frustration and potentially a monetary loss.
JL: What are the rarest and most valuable autos that you’ve been able to find and purchase in your searches? YJ: Without a doubt one of the finest and rarest cars we have ever located is the 1950 Cisitalia-Abarth 204A chassis #04 worth over $4.5 million. We discovered the lead during a car hunting trip in Argentina, which ultimately took us from Buenos Aires to Turin, Italy. This is a one-of-a-kind historic competition vehicle with incredible provenance that is well documented. This particular car represents an incredible spectrum of post-World War II automotive history involving some of the eras biggest legends such as Porsche founder Ferdinand Porsche; Cisitalia founder Piero Dusio; Carlo Abarth; and Tazio “The Flyihng Mantuan” Nuvolari — who is arguably one of the greatest competition drivers of all time. He achieved over 90 Grand Prix victories during his career and is recognized as the innovator of the racing technique called “drifting.”
we are a business and most everything is available for our clients to purchase, which means we constantly have to let go of our favorites. One example is a 1963 Corvette Split Window coupe that is believed to be one of only three ever built with prototype rear air-conditioning. We also have a 1969 Beetle which is one of only 15 built by the last VW Beetle factory in the world. And our 1931 Pur Sang-Bugatti Type 51 delivers an unparalleled open cockpit. Last, but not least, is a 1972 Opel GT — while it’s not very expensive, it is an exact clone of Antonio’s first classic car he purchased in high school.
JL: Who are some of the greatest auto collectors in the world, and in your opinion, what are their greatest treasures? AB: Without a doubt one of the best known public collectors is Jay Leno. He has an incredible collection of Bugattis and has a very diverse taste in classic cars from different eras, which we relate to since we also appreciate most eras and designs of collector cars. Ralph Lauren has an incredible collection and owns probably one of our personal favorite cars ever produced: the Bugatti Atlantic. But the truth is that some of the most impressive cars and collections are owned by individuals around the world that choose to remain anonymous and keep their valuable assets behind closed doors. JL: What are the best auto collections in the world that are available for public viewing?
JL: What are some of the most unusual places you’ve found automotive treasures? YJ: As you’ll see in “Chrome Underground,” Latin America has truly surprised us with some most unusual and incredible adventures in our search for automotive treasure. We really enjoy immersing ourselves in the culture and history surrounding the cars we hunt, while traveling around the world searching for the rarest and finest.
JL: What models are on your collectible auto wish list, either for yourselves or for clients?
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L U X U R Y & L I F E S T Y L E | Just Luxe
YJ: We personally like the Museum dell Automobile di Torino in Italy, the Mullin Automotive Museum in Oxnard, CA, and the Petersen Automotive Museum in Los Angeles, California. But without a doubt Scottsdale, Arizona and Monterey, California both have an annual automotive extravaganza featuring several premier collector car auctions that display and then sell some of the most magnificent collections of cars assembled anywhere in the world.
JL: Which other auto auctions do you recommend for the serious collector? AB: Well, Motostalgia, of course, which is our own collector car auction. But the truth is that it also depends on the genre of collector cars that you are searching for. Currently, Mecum is probably leading the industry selling muscle cars and American classics. RM Auctions and Gooding & Company battle it out for dominance in the fine European sports car and antique vehicle market. Bonhams maintains a strong market for historic competition cars. And in Scottsdale the world-recognized Barrett-Jackson has great cars and offers an impressive experience not to be missed. JL: What are the “holy grails” for car collectors such as yourself and your clients? Cars that may or may not even exist to be found? AB: The biggest “holy grails” are the ones that have not yet been found. Many times they’re the first and the last of a kind, or cars that are entwined with our history. These can be so valuable monetarily simply because they are time machines that take us back in time to a past that cannot be recreated. Some cars that can be called holy grails are cars have had a significant impact on our culture, such as the 1934 Ford in which Bonnie and Clyde were killed. Some have been part of the changing course of history, like the Lincoln limousine in which JFK was shot or the Mercedes Benz horseless carriage which was the first personal transportation without the use of animals. Cars have changed empires, as did the first Beetle designed by Ferdinand Porsche and used by the Germans. The first factory-produced Ford Model T revolutionized industrial production and altered the course of US history. And the cars created by the short-lived legend Jean Bugatti are artistic masterpieces that will forever impact the concept of design. 56 | American Hard Assets www.ahametals.com
JL: What do you recommend collectors invest in now for best return in the future? AB: Vintage European sport cars represent a very strong short-term market. For longer term investments, pre-war American classics are a great value at today’s pricing. For higher dollar investments, vintage competition cars are very secure. For investments to simply drive and enjoy it’s hard to beat the value of muscle cars. For a safe investment designed to mitigate financial risk, we like classic American cruisers. Vintage trucks are slowly increasing in value as they grow in popularity. Be careful with customs, street rods and hot rods, as some of them are worth a small fortune, but personal taste plays a large role in determining pricing in this market. Again, we highly recommend that all buyers consult with a professional.
Just Luxe | L U X U R Y & L I F E S T Y L E
Hauntingly Historic American Horror Story Mansion Back on Market By Mila Pantovich JustLuxe
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eople in Los Angeles are pretty familiar with the registered cultural monument at 1120 Westchester Place that’s affectionately dubbed the “Murder House” — you know, the spooky mansion that has popped up in a number of movies and television shows, like the first season of American Horror Story. The luxury estate, which has been everything from a private home and chapel to a Hollywood film set, is officially looking for a new owner at only $5 million. Designed by famous architect Alfred F. Rosenheim — who is known for Gothic design and created several homes such as this one - the three-story mansion broke ground in 1907 and took five years to finish. The estate sits on over 20,000 square feet of land, which includes the main house and a grand ballroom (which used to be a chapel when the Catholic Church owned the property in 1954). The current owners, music producer John Gocha and Greta von Steinbauer, have been using the ballroom as a private recording studio — so you know tons of famous musicians have hung out here. Having originally built it for himself, Rosenheim filled the home with stained glass and Tiffany light fixtures, as well as a hand-painted ceiling in the dining room using silver and gold leaf. With six bedrooms, six baths, and six fireplaces (666?), the estate still has original detailing, marble, imported tiles, and hard woods. You can also fit up to 5,000 bottles of wine in the basement — though you may not want to go down there at night.
So, what exactly has been filmed here? The mansion was used in the season four Halloween-themed Buffy the Vampire Slayer episode, Frank Sinatra’s Old Blue Eyes, Spiderman, Because I Said So and Seabiscuit. It’s appeared in a long list of television shows, including CSI Miami, Alfred Hitchcock Presents, Dexter, Dragnet, Hill Street Blues, Six Feet Under, The Twilight Zone, The X-Files, Law & Order, Ghost Whisperer, NCIS, The Closer, Nurse Jackie, CSI New York, The Unit, 90210, Angel, The Mentalist, 24, Criminal Minds, Law & Order: Special Victims Unit, Monk, Grey’s Anatomy, Bones, and Californication…to name a few. Photography fan? Many of the art world’s biggest names have shot on the property, including Herb Ritts, Annie Leibovitz, Walker Evans, Bruce Weber, Helmut Newton, Guy Bourdin, Henry Cartier-Bresson, Diane Arbus, David LaChapelle, Peter Lindbergh, Mario Testino, and Terry Richardson. The “Murder House” has been on the market several times these past few years — with last year asking for $17 million. At just $5 million this time around, the estate is a steal, especially considering how much revenue you’ll pull in from Hollywood executives constantly knocking on your door with movie and TV proposals. www.ahametals.com American Hard Assets | 57
S P E C I A L F E A T U R E | 5 Years of Treasure
Treasure By Hector Cantú
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hese factors above are the primary drivers of the booming collectibles market, with auction houses achieving record prices for the world’s most unique treasures. And more often than not, the biggest treasures are linked to masters of their trade and pop-culture legends – both real and fictional: the Beatles, King Kong, Muhammad Ali, Superman. Among the more impressive recent examples is a piece by legendary American illustrator Norman Rockwell. The famous illustrator’s 1957 painting “After the Prom” sold at auction in 1995 for $880,000. Earlier this year, it sold for $9.1 million – a compounded annual rate of return of 13.1 percent (compared with 7.9 percent for the Standard & Poor’s 500-stock index over the same period). “High-end and important pieces will always do best,” says Mark Prendergast, director of trusts and estates at Heritage Auctions. “I use the term ‘bluechip.’ These are pieces that most often will retain their value and even increase in value consistently. Independent of what’s going on in the wider market, collectors are competing to acquire the best items in their respective categories.” In coin and currency, these are often the rarest and highestgraded examples. In the art world, it’s masters like Picasso
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and Monet. In movie-poster collecting, it’s legendary characters or actors (think “Frankenstein” or Humphrey Bogart). In comics, it’s the earliest appearances of today’s most popular superheroes – such as Superman, Batman and Spider-Man. Experts warn, however, that not all items attached to legends are super-collectibles. Babe Ruth signed thousands of baseballs during his lifetime (and his batboys probably the same amount). Today, only the highest-graded balls command top dollar. The value of Ruthsigned balls can range from $1,000 to $300,000, depending on the year signed and condition of the ball and signature. Memorabilia collectors are more likely to vigorously pursue unique items – those moment-in-time artifacts that are part of history. The watch presented to Ruth after his New York Yankees won the 1923 World Championship sold for $717,000 at a February 2014 auction.
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Another blue-chip name is Andy Warhol. “Prints that were selling for a couple of thousand dollars a decade ago are now approaching or exceeding the $50,000 range,” Prendergast says.
acquiring the highest-quality and most-important piece you can afford. “I often tell collectors they might be better off buying one million-dollar piece rather than ten $100,000 pieces,” Prendergast says.
What’s driving the high-end collectibles market? “We are seeing a market of collectors that is more global,” Prendergast says. “From the Asian market to the Indian subcontinent to the American market, we are seeing a demand for things that are fashionable or popular in the art world, in sports and in pop culture.” For novice collectors with the means to acquire top treasures, Prendergast offers a few suggestions:
Ultimately, you should enjoy your hobby. Collectibles can help diversify a portfolio, but they are more than investments. “Collecting is a way of making a connection with the past or enjoying fine art or memorabilia that mean something to you,” Prendergast says. “Not too many people put their stock certificates on display to show off to friends, do they?” Following are examples of some of the biggest treasures to sell at auction within the past five years.
Conduct research in your area of interest. Talk to dealers and auction house experts before making a significant purchase.Consider
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S P E C I A L F E A T U R E | 5 Years of Treasure
COINS: 1787 Brasher Doubloon The finest certified example of the 1787 Brasher Doubloon sold for $4.58 million in January 2014. It’s one of only seven Brasher Doubloons known to have survived to the present day, and was last sold in 1979 for $430,000 – marking a tenfold increase over 35 years. “The legendary Brasher Doubloon is one of the most important coins in American history because it’s the first gold coin struck for the young United States,” explains Todd Imhof, executive vice president at Heritage Auctions. Ephraim Brasher, the maker of the doubloon, was a prominent New York City gold and silversmith.
WESTERN ART: William Robinson Leigh’s ‘Home, Sweet Home’ Soon after arriving in New Mexico in 1906, William Robinson Leigh began documenting the Southwest with sketches and painting studies of the Pueblo Indians, the landscape and wildlife.Over the next 40 years, the West Virginia native would become one of the most important painters of the American West. The New York Herald Tribune called him “the last surviving member of the famous Western painting trio that included Frederic Remington and Charles Russell.” In November 2011, his 1932 oil on canvas titled “Home Sweet Home” sold for $1.19 million at a Heritage auction, a world record price for the artist. “It’s an iconic image of the historic west,” says Heritage Auctions vice president Ed Beardsley. The painting had belonged to Philip Jonsson, son of Texas Instruments co-founder J. Erik Jonsson.
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MEDALS: Francis H.C. Crick’s Nobel Prize Medal Many historians place Francis H.C. Crickin the company of Galileo, Darwin and Einstein as one of the greatest scientists of all time. The British molecular biophysicist co-discovered the structure of the DNA molecule in 1953 with James D. Watson. Nine years later, Crick, Watson and Maurice Wilkins were awarded the Nobel Prize for Physiology or Medicine for their groundbreaking work — widely regarded as one of the most important discoveries of 20th century biology. In April 2013, the Francis Crick Family Trust auctioned his Nobel Prize Medal and Nobel Diploma for $2.27 million. A portion of the sale benefitted the Francis Crick Institute in London.
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S P E C I A L F E A T U R E | 5 Years of Treasure
FIREARMS: Colt’s Texas Paterson Revolver Samuel Colt’s first revolvers were produced beginning in 1837 in Patterson, N.J. A limited number of the inventor’s Holster Model No. 5 revolver, also known as a Texas Paterson, was manufactured. “It’s even rarer to find this revolver cased with all its accessories,” says Heritage Auctions firearms expert Clifford Chappell. “It’s one of the best Colt revolvers known, both historically and condition-wise.” This revolver sold for $977,500 in September 2011. The Texas Paterson revolver was the immediate predecessor to the Walker Colt, and both are extremely important in the evolution of Colt firearms.
COMIC BOOKS: Detective Comics #27
ANCIENT COINS: Roman Gold Coin
Batman has been in continuous publication since 1939, making him the world’s foremost fictional detective, alongside Sherlock Holmes. Detective Comics #27, featuring Dark Knight’s first appearance, is among the most prized comics in the hobby. A copy graded 8.0 very fine sold for $1.075 million at a February 2010 Heritage auction. By comparison, another copy with an 8.0 grade sold for $278,189 in 2001.
During their efforts to control the rebellious province of Judaea, the Romans often struck coins to commemorate their triumphs. In A.D. 70, at about the time of the Siege of Jerusalem, the Roman general Titus produced gold coins – known as aurei – depicting the goddess Victory inscribing a shield, along with the phrase IVDAEA DEVICTA – “Judaea is Conquered.” An extremely fine example depicting the portrait of Titus, who went on to capture Jerusalem, sold for $956,000 in March 2012. Titus ruled the Roman Empire from 79 to 81.
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5 Years of Treasure | S P E C I A L F E A T U R E
SPORTS: Muhammad Ali’s Gloves Few athletes have exploded onto the worldwide stage like Cassius Clay. At the age of 22, the Kentucky native won the world heavyweight championship in a stunning defeat of Sonny Liston. Shortly after thefight, Clay joined the Nation of Islam and changed his name to Muhammad Ali. The gloves he wore in that historic 1964 battle sold for $836,500 in a February 2014 auction.
COMIC ART: First Wolverine art
MOVIE POSTER: King Kong King Kong is more than a giant of cinema; he’s a giant among movieposter collectors. When released in 1933, the film was an instant hit that would take its place among Hollywood’s greatest movies. Posters in very fine or better condition are extremely rare. This “Style B” poster, measuring 40¼ by 79 inches, “is a visual triumph and one of the rarest three-sheets in the hobby,” says Grey Smith, director of vintage movie posters at Heritage Auctions. Graded in very fine-plus condition, it sold for $388,375 in November 2012.
Wolverine is the most popular of Marvel Comics’ X-Men characters – bursting into the Marvel Universe in the last panel of 1974’s The Incredible Hulk #180.In the four decades since artistsHerb Trimpeand Jack Abel drew that page, the mutant anti-hero has starred in movies, video games, cartoons and countless comic books and graphic novels. Comic fans prize first appearances, and in May 2014, the original art of Wolverine’s first-ever appearance sold for $657,250. Trimpe had given the page to the consignor in 1983 when the consignor was a teenager. www.ahametals.com American Hard Assets | 63
S P E C I A L F E A T U R E | 5 Years of Treasure
CURRENCY: $1000 1890 Treasury Note Treasury notes were issued by the government from 1890 until 1893 to individuals selling silver bullion to the Treasury. The rarest of these is the 1890 $1000 Treasury Note. In 1970, one of three-known $1000 notes sold at auction for $11,000. Thirty-six years later, it sold for $2.22 million. In January 2014, it realized $3.29 million at a Heritage Auction, making it the most valuable piece of currency on the planet. The note is known as a “Grand Watermelon” because its zeroes resemble watermelons. “The Grand Watermelon is one of the ultimate currency rarities,” says Dustin Johnston, director of currency at Heritage Auctions.
POLITICAL: Kennedy’s Oval Office flags These two flags stood in the White House Oval Office of President John F. Kennedy during the time he was president: the U.S. flag to his right and the presidential flag to his left. Shortly after Kennedy’s assassination, these flags were given to Evelyn Lincoln, the president’s devoted personal secretary, at the request of Jacqueline Kennedy. They were subsequently bequeathed to the University of Pittsburgh, which auctioned the flags in 2002. They sold at a November 2013 Heritage auction for $425,000. Hector Cantú is editorial director at The Intelligent Collector magazine.
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S P E C I A L F E A T U R E | Building Wealth Through Cards
By Douglas Kale
In search of undervalued and overlooked vintage baseball cards
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ith the crack of a bat the inaugural professional season of the National Association of Base Ball Players in 1869 was underway. Baseball cards were issued that year to promote and honor those first big leaguers. Both the league and the cards have enjoyed tremendous success ever since. With so many worthwhile cards released over the past 150 years, it can be a daunting task to select the right ones for investment. But, over the years, extensive research has been done, and an exclusive investment list of nine overlooked and undervalued baseball cards is presented here for the readers of American Hard Assets. These are cards that serious collectors and investors should be adding to their portfolios.
standard. These professional graders are trained to identify flaws in both vintage and modern trading cards. They have a standardized grading system (grades 1 to 10) which eliminates the subjective nature of condition. Professionally graded vintage cards with better centering and corners,in the graded range of Excellent - Mint (6) to an unbeatable Pristine (10) are the cream-of-the-crop when it comes to noteworthy investments. So, without further ado, let’s get down to business…
Here are some basics to remember when investing in baseball cards. Every card should be graded in four distinct areas: centering, corners, edges and surface. Most serious collectors and investors prefer to buy and sell in professionally graded cards because it eliminates discussion as to condition. Professionally graded cards which are carefully slabbed (placed) and sealed in airtight plastic card holders from Professional Sports Authenticator (PSA), Beckett Grading Service (BGS) or Beckett Vintage Grading (BVG), and Sportscard Guarantee (SGC) are regarded as the industry
1. 1948 Swell Gum Lou Gehrig (card #14) – When hardcore baseball fans and hobbyists think about collecting the greatest players of the game, they usually turn to Babe Ruth, Lou Gehrig, Ty Cobb and Mickey Mantle. Many of Lou Gehrig’s cards such as the 1933 Goudey #92i n Excellent 5 to Near Mint 7 grades,sell in the $3000 to $10000 price range. What many collectors don’t realize is that even back in the 1930s, the Goudeys were produced in large quantities and can be found in many collections to this day. However, one Gehrig card that is not in
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Building Wealth Through Cards | S P E C I A L F E A T U R E
plentiful supply is the 1948 Swell Gum card #14. This card is hardto-find and an investment item that most people don’t have in their collection. The Swell Gehrig card features an original photograph of Lou with his big smile in a New York Yankees uniform. It’s a wonderful card that’s very undervalued at its current excellent condition book price range of $200 to $300. A professionally graded Excellent 5 condition specimen can command prices of $500 or more. With the true scarcity of this Gehrig card, an Excellent pro grade of 5 should be at least $1000 in today’s market. This is a great investment.
2. 1953 Topps Whitey Ford (card #207) – Whitey Ford
is arguably one of the greatest pitchers the New York Yankees have ever had. When people talk about the Yankee dynasties of the 1950s and 60s, Whitey’s name is usually mentioned in that group of players. The ’53 Topps Whitey Ford is an overlooked and undervalued card for several reasons. First of all, it’s Whitey’s first Topps card and some like to call it his Topps rookie card. Second, the Yankees won the World Series that year. When you compare its book value of $300 in EX-MT
to Whitey’s ’51 Bowman card at $1500 in EX-MT, the value of this card is incredibly low. Its value should be at least $500-$600 in EX-MT, double of the current price guide listings. If you can find this card in a higher grade condition (NR MT 7 or higher), it would be a solid addition to any investment portfolio.
3. 1948 Bowman Stan Musial (card #360) – Stan “The Man” Musial was to the St. Louis Cardinals as Mickey Mantle was to the New York Yankees. Musial is regarded as one of the greatest hitters to ever. So, if this is the case, why is his ’48 Bowman rookie card so undervalued with a current book price of only $500 to $800 in Excellent condition? Perhaps it’s the small size of the 1948 Bowman card. Most collectors do prefer card sizes closer to the modern day 2.5 by 3.5 inches. Maybe it’s because the card features a black and white photo instead of one in color. What we do know is, for a 1940s rookie card of a Hall of Fame player of this caliber, Musial’s rookie card is a fantastic buy. If you can find this card in a highly graded condition (an EX-MT 6 or www.ahametals.com American Hard Assets | 67
S P E C I A L F E A T U R E | Building Wealth Through Cards
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1953 Topps Whitey Ford (card #207)
1948 Swell Gum Lou Gehrig (card #14)
higher) for $800 or less, snap it up! It’s an excellent investment right now and a classic vintage card of a big name player.
4. 1972 Topps Carlton Fisk Rookie (card #79) –
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1948 Bowman Stan Musial (card #360)
Mint-Mint 8 for less than $700, add it to your portfolio. The Reggie rookie has to be one of the best bargains in baseball card collecting today.
When Boston fans think of notable Red Sox players from long ago, three names usually pop up right away, Fred Lynn, Jim Rice and Carlton Fisk. Fisk was not only an outstanding catcher and home run hitter; he was also a clutch hitter. His home run during Game 6 of the 1975 World Series is a baseball highlight film classic. Fisk was the first rookie in baseball history to be voted unanimously for the Rookie of the Year award in 1972. He was also one of the toughest players the Red Sox have ever had. When players were rounding the bases, he always stood his ground like a brick wall to prevent the player from touching home plate. Fans loved his playing style and enjoyed collecting his cards. His 1972 Topps rookie card has been extremely difficult to find in high grades. Professionally graded cards with a grade of a Mint 9 are currently selling in the $800 to $900 range and should be double that number. If you can locate one, buy it. It’s a smart investment in a Red Sox Hall of Famer’s rookie card that will continue to appreciate over time.
6. 1909-11 T-206 Hughie Jennings (One Hand
5. 1969 Topps Reggie Jackson rookie (card
7. 1961 Topps Babe Ruth (card #401) – Any person
#260) – Here’s a ballplayer who was lucky enough to play for two
baseball franchises when they won back-to-back World Series: Oakland A’s (1972-74) and the New York Yankees (1977-78). Reggie was a fun character to watch and fans cheered him wildly every time he stepped up to the plate. He became so popular after the 1977 World Series that a candy bar was named after him, The Reggie Bar. He had several memorable World Series home runs with the New York Yankees and is a member of the 500 Home Run Club, yet his rookie card is still much undervalued. If you can find his ’69 Topps rookie card in a pro grade of Near Mint 7or Near 68 | American Hard Assets www.ahametals.com
Showing version) – Jennings hit .401 in 1896 and ended
his career with an impressive .312 batting average. He was also a master of getting hit by a pitch to get on base. He led the National League Hit By Pitch category five years in a row and still holds the career record to this day. Jennings also managed the Detroit Tigers during the Ty Cobb years and helped his team win the American League pennant three years in a row. He’s a Hall of Famer whose baseball cards are undervalued. Owning a Hughie Jennings card from the 1909-11 T-206 series in a professional grade of 5 or 6 is an excellent investment. Although there are two variants of this card (one or two hands showing) they’re both valued the same.At the current price range of $250 to $400 for an Excellent 5 grade, this card’s value should be double that amount. It’s also a great addition to an avid baseball fan’s card collection due to the status as a desirable variant card.
with the slightest interest in baseball history, statistics or card collecting is familiar with Babe Ruth. He remains without question one of baseball’s elite. If you’re a card collector or investor and want to buy a vintage Ruth card, you’ll need to shell out a minimum of $3000 for one in acceptable condition. However, there’s one Ruth card that has been overlooked for many years. It’s the ’61 Topps commemorative card picturing Babe hitting his 60th home run of the season. It’s interesting to note that this card was released shortly before Roger Maris broke Babe’s single season home run record. The card portrays Ruth in his classic hitting pose as captured
Building Wealth Through Cards | S P E C I A L F E A T U R E
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1972 Topps Carlton Fisk Rookie (card #79)
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1969 Topps Reggie Jackson rookie (card #260)
in a vintage colorized photograph. If you can find this Ruth card professionally graded with an 8.5 or 9 pro grade for under $200, grab it. This card can only increase in value.
8. 1955 Bowman Mickey Mantle (card #202) – Like Ruth, Mantle is also a Hall of Famer that will forever be known as one of the game’s giants. The New York Yankees won seven World Series with Mantle on the team. In addition to those championships, Mantle was named MVP of the American League three times including a Triple Crown winner in 1956. In the baseball card hobby, Mantle has always been a fan favorite and scanning through any card sets from the 1950s or 60s, you’ll notice that Mantle cards are usually the most valuable in each set. The ’55 Bowman set which features the iconic color TV design that celebrated the introduction of a new era in television also includes Mantle. The dark brown wood-grain borders usually show wear quickly and keeping them in mint condition has always been a challenge. Obtaining a ’55 Bowman Mantle card in a high grade (7 or higher) is a terrific investment. Many card experts believe this card, currently commanding $800 in today’s market ungraded, is still undervalued and could command prices upward of $2000 in the near future. 9. 1957 Topps Sandy Koufax (card #302) – Koufax is
arguably one of the greatest Dodgers pitchers of all time. His career spanned the end of the Brooklyn era in the late 50s to the mid-60s with the newly located Los Angeles Dodgers. Sandy helped the team win many pennants and during the 1960s he won the Cy Young pitching award three times in addition to being named the National League MVP in 1963. His lifetime ERA is an incredible 2.76 and he was named World Series MVP twice: 1963 and 1965. In his last year with the Dodgers (1966) Sandy went out in style by racking up 27 wins (1st in the NL), an ERA of 1.73 (1st in the NL) and 317 Strikeouts (1st
6 1909-11 T-206 Hughie Jennings (One Hand Showing version)
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1955 Bowman Mickey Mantle (card #202)
1961 Topps Babe Ruth (card #401)
in the NL). He was certainly an amazing pitcher. His ’57 Topps card which pictures a close-up view of Sandy in his ball cap during the last year of the Brooklyn Dodgers before they moved to LA. This card is also highly desirable since it was released in the lower production high-numbered series and is considered a key card to complete the 1957 Topps Baseball Card set. Professional grades of 5 to 6 range in the $150 to $250, while grades of 7 and 8 can range from $400 to as high as $1000. This card brings back lots of memories for Dodgers fans and collectors consider it a fantastic investment.
Parting Advice There are a few things to remember when investing in baseball cards. First, find a card in the best condition available within your price range. Second, make sure the card features a well-known player. And third, invest in cards that are scarcer in number and not in most people’s collections. Use these tips and you’ll own something unique and very desirable that will continue to hold or increase in value. Doug Kale is a vintage baseball card expert. He’s been an avid baseball card collector for more than 30 years, an east coast sports card dealer for two decades, professional card grader for BGS, price guide editor for Beckett Media and Century Publishing as well as editor-in-chief of the national newsstand publication, Sports Card Trader, for seven years.
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1957 Topps Sandy Koufax (card #302)
Glossary of Terms Baseball Card Companies (vintage)– Bowman, Cracker Jack, Double Play, Fleer, Goudey, Leaf, Old Judge, Playball, Swell, T-206, Topps Book Price – This usually refers to a price guide book or a pricing authority’s publication such as the Beckett Price Guide or Sports Collector’s Digest Price Guide. Clutch hitter – A batter who hits safely more frequently when men are on base or the team is behind in the score.
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S E C T I O N N A M E | Story Name
What modern models have what it takes to become a “collector?”
by Jason Walter Vaile
enry Ford had his Model T. Magnum P.I. had his Ferrari. Bandit had his Trans Am. Throughout history, great men have always been behind the wheel of a great car. All of us strive for that connection, a car that becomes an extension of ourselves, defines who we are...like Knight Rider. Perhaps that’s what drives us to collecting cars at an early age, carrying Hot Wheels to school in our jean pocket to show off to friends. Building plastic models of our dream cars, glued together and custom painted inside and out to our liking. That horse-powered driven dream of owning a collectible car ignited by the spark plug of our imagination.
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As grown up boys, nothing has really changed. Our taste for the exotic, expensive, or maybe just nostalgia still drives us. We all still want that car that will make our friends say “wow”, or take us back to that moment of staring into that 1:24 scale driver’s seat, mimicking the revving engine noise and imagining what it’s like to be behind the wheel. So how can you talk your wife into purchasing a car as an “investment” without her thinking you’re on a one-way road to a mid-life crisis? Probably not gonna happen. Car investment should not be done because you think you’re going to make money on it. You should buy a car that moves you, that you want to keep pristine... that completes you. Car collecting is not an investment for the wallet, but for the soul.
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L U X U R Y & L I F E S T Y L E | Cars for the Next 20 Years
Classic Cars In general, there are very few cars made after 1974 that are considered collectible. Classic cars can be a great investment but are usually expensive since they are already desirable or need a major investment in costly renovations. Many classic cars have had their value outpace traditional investments. The vintage Porsche and Ferrari markets tend to outperform most other collector car markets. The Porsche 356 Speedster, one of the most iconic classic cars, has an average growth in value of about 61% for the last four years. By Comparison, in that same period, silver rose 33% and the price of gold 46%. There are even some rare cases of huge profit returns. The Fiat 600 rolled off the line in 1956. It sold in Great Britain for less than $1000 USD. A sky blue one sold at the RM Auctions in 2012 for over $40k, not a bad ROI. The most expensive car ever sold at auction was the 1967 Ferrari 275 GTB/4s NART Spider. It sold for a whopping $27.5 Million last year. The original sales price? $8,000.
Cautions There are critical differences between putting your money into a car as a collectible asset, and other hard asset investments. Unlike stocks and bonds, you need a place to store it. Gold and silver take up considerably less room than an automobile. You have to insure cars and maintain them. When considering whether to purchase a collectible car, ascertain whether it will go up in value enough every year to cover your annual expenditures on it. The insurance and maintenance costs each year can be considerable. Finding a good deal on a car and flipping it isn’t as easy as it might seem. As a seller at an auction, there is an entry fee and a 7-10%
commission if your car sells. The cost of getting your car to the auction in a safe, enclosed transport can run several thousand dollars and don’t forget Uncle Sam! Capital gain taxes on cars can be as high as 31.8%, basically a luxury tax, and significantly higher than most conventional investments.
Modern Collectibles So what car can you buy today that will be a solid investment for tomorrow? No one can guarantee what will happen in the future, but here are a few automobiles that have something unique or collectible by today’s standards. From the affordable to the ridiculous, let’s take a look:
Toyota FJ Cruiser
Engine: 4.0 Liter V-6 cylinder Horsepower: 260 0-60 MPH: 7.3 seconds Top Speed: 111 MPH MPG: 16 city/20 highway Price: $ 40,000 Toyota originally developed the FJ Cruiser as a throwback to the iconic Landcrusier FJ40 of the 60’s. This year marks the last year of production for the FJ Cruiser. Collectors will likely gobble up the Trail Team package limited to only 2500 cars. Each one will feature the classic Heritage Blue paint job and matching roof. The whimsical, retro look has made the FJ Cruiser quite a success over the past eight years. Along with the throwback feel, it has some real-off road teeth. We had to include at least one SUV/off road vehicle on the list. With its limited run, and this being the last year model, the FJ Cruiser is an inexpensive, fun car to grab and hold on to.
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Cars for the Next 20 Years | L U X U R Y & L I F E S T Y L E
2014 Dodge Challenger R/T Shaker Engine: 5.7 Liter overhead valve V8 Horsepower: 375 0-60 MPH: 4 seconds Top Speed: 185 MPH MPG: 8 city/14 highway Price: $ 45,000
The resurrection of the pony cars is in full swing, and leading that charge is Dodge’s Challenger Shaker. The nostalgic orange paint with black stripes will take collectors back to the classic 1970’s Challenger. The engine isn’t the monster that Ford and Chevrolet pour into their muscle cars, but the “Hemi” V8 that powers this growler is nothing to sneeze at. The Challenger even manages to throw in a decent space for back row seating to tow along a few gawkers on your drive. Dodge just announced that in 2015 a “Hellcat” version will be available with a ridiculous 620 horsepower. So maybe keep the Challenger on your collector’s list for next year too.
Alfa Romeo 4c
Engine: 1742cc 4 Cylinder Horsepower: 237 0-60 MPH: 4.5 seconds Top Speed: 160 MPG: 35 Price: $ 55,000 Built without a muffler, the Alfa Romeo 4c will certainly wake the neighbors when you fire it up. But they’ll want to see you as you pull this beauty out of the garage. Targeted as an “affordable Ferrari,” the 4c gives you style, design and power. With only 1200 being imported this year, you can bet these limited numbers will add to the collectability of this car. And if you’re really lucky, you can grab one of the first 400 that are designated “launch editions.”
Chevrolet Camaro ZL1
Engine: Supercharged, 6.2 Liter V-8 Horsepower: 580 0-60 MPH: 3.9 seconds Top Speed: 184 mph MPG: 14 city/19 highway Price: $ 65,000 The primary appeal of the new Camaro is it’s old-school muscle car style. The ZL1 has plenty of muscle to back that up. With a whopping 580 horsepower, this is one of the most powerful Camaros to come off the assembly line. The 2014 ZL1 has received a major face lift from previous models, including new headlights, one piece tail lights, new spoiler and exhaust tips. The hood features a mean looking louvered hood scoop air extractor that is made from a carbon fiber composite. No, this is not a German luxury car, but the collectible factor comes from the deep gargle of the exhaust that will evoke a testosterone-fueled memory of teenagerhood.
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L U X U R Y & L I F E S T Y L E | Cars for the Next 20 Years
Jaguar F-Type Coupe
Engine: 3.0 liter 2995cc Supercharged V-6 Horsepower: 335/332lbs of torque 0-60 MPH: 5.1 seconds Top Speed: 161 mph MPG: 32 Price: $ 75,000 Celebrities were lined up at Jaguar to get the first Coupe to come off the line. Ian Callum’s design is a technical mastery of automation and super charged power. The V6 compact supercharger’s boost control is designed to ensure that the torque curve rises steeply over a broad range of speeds. The water-cooled intercooler increases both power and efficiency. Efficiency seems to be a big player even in luxury coupes like these. The engine switches off when at a full stop, which helps improve fuel economy. Jaguar will always have a following and the limited run of these coupes will perk collectors interest.
2014 Corvette Stingray Premium Edition Engine: 6.2 Liter l53 V8 Horsepower: 460 0-60 MPH: 3.8 seconds Top Speed: 190 MPH MPG: 29 Price: $ 75,000
Another American throwback for collectors has to be on the list. The name Stingray evokes the great Vettes of the seventies, but the new slick design looks nothing like it’s name sake. Only 500 Premium Edition Stingrays will be produced, making them immediately a hot commodity. Each will be in the eye-grabbing Laguna Blue tint coat paint, that features a dark stripe that highlights the hood. Vin numbers will all begin with 300001-another interesting touch that will pique collectors’ interest. Unique wheel rims and a set of Corvette branded luggage by Thule are just a few added perks that come along with it. The Premium edition includes most amenities and the X51 performance package. Not a bad way to celebrate the 60th anniversary of the first Vette to roll off the assembly line in 1953.
Tesla Roadster Engine: Electric Horsepower: 0-60 MPH: Top Speed: MPG: Price:
288 3.7 seconds 125 MPH 245 miles per charge $100,000
To be environmentally conscious, there had to be at least one electric car on the list. And there’s not a better looking or performing one than the Tesla Roadster. Originally built on the chassis of a Lotus Elite, the Tesla is a one-of-a-kind roadster combining supercar performance with pure electric propulsion. The sporty two-seater is a swift, silent, pollution free joy ride that can out accelerate nearly every Ferrari, Porsche or Aston Martin on the road. Unfortunately, the $100k price tag will keep it only on the “wish list” of most car collectors. 76 | American Hard Assets www.ahametals.com
Cars for the Next 20 Years | L U X U R Y & L I F E S T Y L E
Maserati Ghibli
Engine: Twin turbo 3.0 liter V-6 Horsepower: 345 0-60 MPH: 4.7 seconds Top Speed: 175 mph MPG: 15 city/25 highway Price: $100,000 Ghibli means “desert wind”, and it’s a breeze to see why this Italian sedan could be a hot collectible. Under the hood, this bad boy sports a Ferrari-built engine, hence the massive horse power for a sedan. Maserati is attempting to battle BMW and Mercedes, but once they begin the mass sales and production, spotting a mysterious Maserati won’t be quite the “event” that it is now. The Ghibli definitely feels like an exotic Italian brand that begs to be collected.
Porsche 911 50th Anniversary Limited Edition Engine: Flat 6 Horsepower: 0-60 MPH: Top Speed: MPG: Price:
430 4.2 seconds 186 MPH 29 city/35 highway $135,000
The amazing German automaker couldn’t be left off the list. In 1963, the first 911 was revealed to the world, so Porsche is celebrating with this anniversary edition. Only 1963 were produced making this limited quantity very desirable. The anniversary edition features the wide body that is typically reserved for the all-wheel drive Carrera 4 models. There are two unique colors for this 911: a dark graphite grey, and a lighter grey metallic. A Sport Exhaust System and Porsche’s active suspension management are also included in the package. This car is sure to be a success with 911 enthusiasts and collectors.
BMW i8 Spyder
Engine: 131 hp electric motor linked to the front wheels 223 bhp turbo charged 1.5 liter, 3 cylinder gasoline engine coupled to the rear wheels Horsepower: 354 0-60 MPH: 5 seconds Top Speed: 155 mph MPG: 94 Price: $150,000 The most striking feature of the BMW i8 Spyder is the upswing doors. They swivel both up and out, creating a dramatic statement every time you step in or out of this amazing vehicle. The body is formed of carbon fiber and aluminum chassis, weighing only 3500 pounds. The roll-over bar extends elegantly back to serve as the rear spoiler. The battery pack is located in the central tunnel to ensure 50:50 weight ratio balance. Power can be routed to all four wheels at the same time. With the lithium battery fully charged, it has a pure electric driving range of approximately 19 miles. The Spyder can be recharged using a standard household plug in less than two hours.
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L U X U R Y & L I F E S T Y L E | Cars for the Next 20 Years
Aston Martin Vanquish
Engine: 5.9 Liter V-12 Horsepower: 565 0-60 MPH: 4 seconds Top Speed: 116 MPH MPG: 13 city/19 highway Price: $285,000 After 100 years of making some of the world’s most beautiful and desirable cars, Aston Martin set off to design a new flagship. They began with an aluminum frame for its lightweight durability. Then they added a body with every inch of panel constructed from carbon fiber. The Vanquish has an exquisite ergonomic interior. The seats are accented with an hour glass design that features over one million stitches. Bond would surely appreciate the slick mastery of updated engineering to his old ride. Collectors grab up the classic old design, and may start eyeing the modern-day classic feel of the Vanquish.
LaFerrari
Engine: 6.3 Liter V-12 Horsepower: 789 (with electric boost to 950 hp) 0-60 MPH: 3 seconds Top Speed: 217 MPH MPG: 10 City/17 Highway Price: $1.4 Million Not Ferrari’s LaFerrari, rather just LaFerrari, is their first hybrid model in the ring. And what a way to start! LaFerrari provides the highest power output of any Ferrari, whilst dropping fuel consumption by forty percent. The debris resistant Kevlar and Carbon-Fiber body is a blend of active aerodynamic elegance and design. With only 499 cars produced, this is Ferrari’s most ambitious project yet, pushing the boundaries of technology. Most of this technology will be passed down to the next generation of Ferraris, paving the way to super-charged sports car with better fuel consumption. The ground-breaking technology and limited run will definitely put a ping on the radar of the most high end collectors. Jason Walter Vaile’s first car was a red Vette (Chevette) which traumatized his social life in high school. He understands the need of owning a great automobile. You can follow him as mrpenhead on Instagram, Twitter and Tumblr.
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M I N I N G & M I N E R A L S | Mining News
Mining News
Osisko Sells to Agnico Eagle and Yamana
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Goldcorp had launched the takeover process with a hostile bid for Osisko, which management strongly advised shareholders to reject. Goldcorp raised its offer once -- to C$3.6 billion -- but was outbid by Yamana and Agnico Eagle.
Osisko’s common shares were delisted from the Toronto Stock Exchange; each outstanding common share of Osisko was exchanged for C$2.09 in cash, 0.07264 of an Agnico Eagle common share, 0.26471 of a Yamana common share, and 0.1 of one common share of Osisko Gold Royalties Ltd., a new spinoff company that will take net smelter royalties off Canadian Malartic and several other properties. Agnico Eagle and Yamana own 50% each of Osisko.
“With the acquisition of Osisko now completed, Agnico Eagle looks forward to working with Yamana to further optimise the Canadian Malartic mine and build on the solid operational performance achieved in May 2014,” Agnico Eagle president and CEO Sean Boyd said.Osisko reported record gold production of 51,114 oz in May. He also noted tht Canadian Malartic will be Agnico Eagle’s fourth producing mine in Quebec and will make the company Quebec’s largest gold producer.
anadian gold junior Osisko Mining Corp. was formally acquired by Agnico Eagle Mines (NYSE: AEM) and Yamana Gold (NYSE: AUY) in June, finalizing the C$3.9 billion bid that beat out a hostile takeover attempt by Goldcorp earlier this year. The Canadian Malartic mine in Quebec will now be operated by a joint committee.
“We are pleased that Osisko shareholders have the unique opportunity to continue to participate in the Canadian Malartic success story as shareholders of Osisko Gold Royalties - a royalty company founded on the strong platform of that asset,” said Oskisko’s chairman and CEO,Sean Roosen. Agnico Eagle and Yamana plan to explore Osisko’s Kirkland Lake, Hammond Reef, Pandora and Wood-Pandora properties in addition to operatomg Canadian Malartic, which is in the rampup phase of production. 80 | American Hard Assets www.ahametals.com
“The completion of our joint acquisition of Osisko and the Canadian Malartic mine adds another cornerstone asset to our portfolio that will contribute significantly to increased production and cash flow levels as we continue to balance top and bottom line growth,” said Peter Marrone, chairman and CEO of Yamana, which has multiple properties in the Americas and sees the acquisition as an opportunity to establish a Canadian presence while benefiting from the already-producing mine’s revenue flow.
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Mining News
Pilot Gold Strikes Again P ilot Gold (TSX: PLG), the junior exploration company created when Newmont Mining (NYSE: NEM) acquired Fronteer Gold in 2011, reported strong drilling results from its Nevada and Turkey properties in the first half of 2014.
The company is led by former members of Fronteer Gold with a history of finding valuable deposits, including Mark O’Dea as chairman and Matt Lennox-King as president and CEO. At its majority-owned and operated Kinsley Mountain gold project in Nevada, Pilot Gold’s 2014 drill targets included 3.35 g/t gold over 41.1, 3.08 g/t gold over 19.8 m, and 1.75 g/t gold over 22.9 m. The drill program uncovered a predominantly oxide gold mineralization.
copper over 153.1 meters.The mineralization starts a few meters below surface. “This is the third Cu-Au porphyry that our technical team has discovered in the [Biga] district,” commented Lennox-King. “Along with the K2 porphyry and the neighboring Halilaga deposit, this discovery lays the foundation for an exciting new porphyry district in northwest Turkey.” Pilot Gold currently owns 40% of the TV Tower project, but could bring that to 60% by putting $21 million toward exploration over three years.
Kinsley Mountain is about 90 km away from the Long Canyon deposit acquired by Newmont when it bought Fronteer for $2.3 billion and, according to Pilot Gold, has a similar gold mineralization to other sediment-hosted deposits east of the Carlin Trend in northeast Nevada. It was previously mined by Alta Gold Company in the late 1990s.
Halilaga was discovered by Fronteer Gold in 2007 and is now operated by Teck in a 60-40 joint venture with Pilot Gold. A preliminary economic assessment from 2012 outlines an open-pit mine with a 26% IRR, based on $1,200/oz gold, $2.90/lb copper, and an Indicated resource of 1.665 million oz gold at 0.31 g/t and 1.112 billion lb copper at 0.30% copper.
A new porphyry target at the TV Tower project in Turkey – a joint venture between Pilot Gold and Teck Resources’ (NYSE: TCK) Turkish subsidiary -- included drill samples with 0.99 g/t gold and 0.39%
Pilot Gold’s share price almost doubled between between January and mid-June 2014. It closed at C$1.63 on June 12, up from $0.86 on Dec. 31, 2013, and C$1.20 on June 14, 2013.
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Mining News | M I N I N G & M I N E R A L S
Mining News
ASIC Fines Newcrest $1.12 Million for Selective Disclosure
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ewcrest Mining (ASX:NCM) agreed to pay $1.12 million in June for violating disclosure requirements. Newcrest admitted to holding selective briefings of analysts and investors in 2013, but not to intentionally breaching regulations. Newcrest has not taken steps to dismiss any executives involved, on its own initiative or at ASIC request.
by ASIC. The highest fine on record was $500,000 paid by veterinary pharmaceutical company Chemeq in 2006. Newcrest’s trouble dates back to June 2013, when it announced an aggressive cost-cutting campaign and writedowns of several billion dollars. Shortly before the announcement, a handful of analysts had downgraded the company, leading to widespread suspicion they had been inappropriately warned and to the launch of an ASIC investigation.
The Australian Securities & Investments Commission (ASIC) and Newcrest agreed to a settlement that would cost the company $800,000 for releasing information on 2014’s production forecast and $400,000 for hinting at 2014 capital expenditure. Australia’s federal court has final authority over the fine. As they stand, these figures present the highest such penalties recommended to date
Newcrest has modified its disclosure policies since the incident. Chairman Peter Hay said, “Newcrest takes its disclosure obligations very seriously and sincerely regrets the contraventions.”
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M I N I N G & M I N E R A L S | Mining News
Mining News
Rosia Montana Shelved
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oth levels of the Romanian government have signalled unwillingness to turn against public protests and allow what would have been Europe’s biggest open-pit gold mine. In May, the lower house of parliament followed the upper house in voting down a bill that would have enabled the proposed Rosia Montana mine to be built by Gabriel Resources (TSX: GBU). Gabriel Resources has shelved the project, which it began work on 16 years ago. Its latest cost estimate put the project at $1.5 billion. It has spent more than $500 million so far. The company owns 80% of the project and Romania owns the rest. Gabriel Resources has threatened to sue the Romanian government for up to $4 billion in damage claims. Protestors spent years decrying the environmental risks of the project. The mine plan includes cyanide, which can be contained following strict procedures but which can cause environmental devastation with incautious handling. A cyanide spill at a mine in Baia Mare in northern
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Romania in 2000 caused a massive fish die-off that has left Romanians wary. Rosia Montana’s plan also calls for the removal of four mountaintops. Corruption is also charged by opponents. For example, a government-commissioned report kept quiet for three years suggested that Rosia Montana may qualify as a UNESCO world heritage site, given its history as a Roman gold mine. If the site were added to the UNESCO list, mining would be off the table. An NGO, Alburnus Maior, recently forced publication of the report. Amendments to the country’s mining law were introduced in August that would allow mine operators to argue an “overriding public interest” and work land otherwise off limits. Prime Minister Victor Ponta, who intially backed the legislation, changed his mind in late 2013. It was voted down by Romania’s Senate in December 2013 and its Chamber of Deputies in May 2014.
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Mining News
Seabed Mining: Progressing in Papua New Guinea, Panned in New Zealand
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n April, Nautilus Minerals (TSX: NUS) and the state of Papua New Guinea signed an agreement to enable the Solwara 1 underground mining project to move forward. Nautilus shares rose 70% on the Toronto Stock exchange, closing at C$0.40 on the day of the announcement. Papua New Guinea paid a $7 million deposit on a 15% interest in the project and placed an additional $113 million in escrow to cover its full share of the capital needed to take Solwara 1 to production. It has the option of taking another 15% of the project. Nautilus and Papua New Guinea had spent the last two years in disputes over project ownership and a prior agreement had been terminated. Seabed mining has yet to take place successfully; it is technically challenging and plagued by environmental unknowns. Nautilus, the first company to explore for underwater polymetallic volcanogenic massive suphide deposits, has spent several years feeding funds as available into the development of custom equipment. In May it announced the completion of the first of three machines, and the commencement of the second, by UK-based subsea vehicle maker SMD. Together they will collect excavated material and pipe it away as seawater slurry. Criticism from environmentalists and marine biologists has not halted Solwara 1’s progress. But an iron mining project proposed by Trans Tasman Resources was shot down in June by New Zealand’s Environmental Protection Agency (EPA). The company had applied for
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a permit to mine 66 square kilometers of iron-rich black sand in the South Taranaki Bight, a coastal indentation off New Zealand’s North Island. The EPA decision cited a “lack of clarity” about the benefits and risks of the project. It read in part: “The uncertainties in the scope and significance of the potential adverse environmental effects, the lack of confidence we find in the extent to which existing interests will be appropriately taken into account, the lack of clarity about the extent of economic benefit to New Zealand outside of royalties and taxes and the economic value of the adverse effects, cannot be remedied by the imposition of other lawful conditions that we could require based on the evidence before us.” “Seabed mining is an untested novel idea and at best this application was premature,” commented Phil McCabe, a spokesperson for Kiwis Against Seabed Mining. “This first hearing process really highlighted the complexities of the marine environment and that current scientific understanding of what exists is very limited, therefore we’re unable to predict the effects with any certainty.” Despite the challenges, seabed mining is widely entertained as a prospect. Fiji, Solomon Islands, Tonga and Vanuatu have issued exploration licenses. The International Seabed Authority, which regulates mining in international waters, has exploration contracts with 16 entities.
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Mining News
Rio Tinto Pulls Out of Pebble
T
he Pebble Limited Partnership (PLP) sufferd a blow in April when Rio Tinto announced it would donate its 19.1% stake in the company to two Alaskan charities. Half the shares were donated to the Alaska Community Foundation, which will use them to create a vocational training fund for extractive industries. The other half were donated to the Bristol Bay Native Corporation Education Foundation, which sold its donated stock for a net $6.48 million in June. In explaining its decision, Rio Tinto stated only that the proposed Pebble project no longer fit its objectives, according to an analysis it began last year. The proposed mine site contains Measured and
Indicated resources of 55 billion lb copper and 62.5 million oz gold, as well as an estimated 4.7 billion lb molybdenum. But Rio had been under pressure from environmental groups, fishermen, and other activists to withdraw from the project. The PLP, now owned solely by Northern Dynasty Minerals (NYSE: NAK), is seeking to stop the Environmental Protection Agency (EPA) from holding scheduled hearings on the project. The company argues that since it has not yet applied for a permit, the EPA’s actions represent a “unilateral process to pre-judge Pebble.”
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H A R D A S S E T S I N F O R M A T I O N | Events
Events August 11-14, 2014 XII International Platinum Symposium Yekaterinburg, Russia http://conf.uran.ru/default.aspx?cid=12ips##16
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September 1-5, 2014 21st General Meeting of the International Mineralogical Association: IMA 2014 Sandton, South Africa http://www.ima2014.co.za/
January 26-29, 2015 Mineral Exploration Roundup 2015 Vancouver Convention Centre - East Facility http://www.amebc.ca/roundup/overview-2014.aspx
September 4-7, 2014 10th Minerals, Metals, Metallurgy & Materials International Exhibition and Conference New Delhi, India http://www.mmmm-expo.com/ September 14-17, 2014 Denver Gold Forum 2014 Denver, Colorado www.denvergold.org/gold-forums/ October 15-17, 2014 14th International Mineral Processing Symposium Kusadasi, Turkey http://www.imps2014.org/ October 20-23, 2014 LME Week London, England www.lme.com/lmeweek.asp November 3-5, 2014 2013 Precious Metals Summit Zurich Park Hyatt Zurich http://www.precioussummit.com/event/2013-summit-zurich/ November 7-9, 2014 Expominer Barcelona, Spain http://www.biztradeshows.com/trade-events/expominer.html
November 11-14, 2014 Metal-Expo 2014 The All-Russia Exhibition Center, Moscow http://metal-expo.ru/en/programm November 20-21, 2014 Minerals Engineering International - Precious Metals 2014 Vineyard Hotel, Cape Town, South Africa http://www.miningnews.net/eventdetail.asp?eventid=2970950
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Feb 9-15, 2015 21st African Mining Indaba 2015 Cape Town, South Africa http://www.miningindaba.com/ Mar 1-4, 2015 PDAC 2015 Cape Town, South Africa http://www.pdac.ca/convention March 9-12, 2015 Asia Mining Congress Suntec Convention Centre, Singapore http://www.terrapinn.com/conference/asia-mining-congress/?pk_ campaign=Terr-Listing&pk_kwd=Energy+%26+Resources April 12-13, 2015 Dubai Precious Metals Conference 2015 Dubai, UAE http://www.dpmc.ae/ May 11-12, 2015 International Symposium on Precious Metals Falmouth, UK http://10times.com/preciousmetalsfalmouth May 23-30, 2015 ALTA 2015 Nickel-Cobalt-Copper, Uranium-REE and GoldPrecious Metals Conference & Expo Perth, Australia http://www.altamet.com.au/conferences/ May 26-28, 2015 Mines & Money Beijing Sofitel Wanda, Beijing, China http://www.minesandmoney.com/beijing/ May 28-29, 2015 HK Precious Metals Summit Hong Kong http://www.precioussummit.com/
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HINDSIGHT
A
By John W. Garibald
fter being overshadowed by gold and silver for more than a decade, platinum and some of its neighbors on the periodic table are having a bit of a renaissance in 2014. Brought to the headlines by a perfect storm of geopolitics, mining strikes, and increased global demand, platinum and palladium seem poised to sprint into 2015 while the rest of the precious metals space merely whimpers. The question that persists is, “why?” Outside of the little blue box with a white bow, why do platinum and the other Platinum Group Metals (PGMs) matter? In reality, while the jewelry industry accounts for nearly a third of global platinum demand, the majority of both platinum and palladium is used by automotive catalytic convertor manufacturers. Sucking up over 40% of the world’s platinum supply and 66% of its palladium last year, manufacturers of autocatalysts have understandably seen a healthy rise in demand as The Great Recession gets farther in our rearview mirrors. The biggest question mark for the autocatalyst industry lies to the East: China uses a fraction of the PGMs (the pollution neutralizing agent in catalytic convertors) that other developed nations do, and some believe it uses none at all. Should China decide to increase PGM usage in autocatalysts to help curb its well documented pollution problems, the catalytic convertors will get more expensive as will the metals they rely on. On the other hand, should the Chinese economy hit a speed-bump or worse yet stall, autocatalyst producers and platinum watchers alike should prepare for a rough landing. As fascinating as manufacturing demand may seem, the real drama in PGMs so far this year has come from the supply side. In January a newly formed union of mineworkers in South Africa began a strike against the three largest mining companies in a region that produces 70% of world’s platinum and 40% of its platinum. The strike, still ongoing at this writing, is creating an estimated loss of 50,000 ounces of platinum production per week. Even with a possible compromise looming, it will be months before even a single ounce of fresh platinum makes it out of a mine due to safety training and production ramp-up. Nearly all of the world’s supply of both platinum and palladium that does not come from South Africa comes from yet another region that breeds global unease and reeks of political chicanery—Russia. Like the only kid at lunch with a snack-pack, Vladimir Putin sees the rest of the lunchroom salivating and is reveling in his position as Grand Poobah of Palladium. Regardless of whether or not Russia’s reserves have dwindled as much as 96 | American Hard Assets www.ahametals.com
have been reported, the Kremlin is determined not to let the rest of us forget who holds the world’s palladium purse strings. As evidenced during the recent Crimean dust-up where you could watch palladium prices rise and fall with Twitter hashtags. The equation is quite simple: the world needs PGMs more than ever and the lion’s share of supply is either currently offline or controlled by a government rivaled only by Westeros in its corruption. With all eyes on the platinum mines of South Africa and the Czar of Palladium and Shirtlessness I reckon we are likely to see both platinum and palladium in many more headlines over the next six months than we have in the recent past. And in this cafeteria, he who holds the snack packs hold the power.
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