New US coins that glitter
THOSE United States coins that you've got jingling in your pocket or hidden away in the top drawer of your dresser may soon include some new -- but expensive -- change: legal-tender gold and silver coins, minted by the US Treasury and available for sale throughout the world. In an electronic age where it's increasingly hard to find anything to save, the mere notion of several new coins should strike a responsive chord on the part of thousands of individuals, and not just investors and coin collectors. Move over, Indian Head Cent and Buffalo Nickel, here comes a new American Gold Eagle!
At least, that's the expectation of Congress, which, in recent months, has initiated action on a number of important coin-related bills:
Lawmakers have approved new gold and silver commemorative coins specially minted to help fund the restoration of the Statue of Liberty. They are on sale now.
Congress has also approved coinage of a new legal-tender silver dollar, which will be available late next year. Although it will have a face value of $1, the actual cost of the coin will be based on the market price of silver, plus a sales commission.
Finally, in perhaps the most important of the new coinage provisions, the Senate, by voice vote last week, approved production of a new legal-tender gold coin designed to be a substitute for the South African Krugerrand. The House, as of this writing, is expected to vote on the proposal shortly.
Congress has approved sanctions against South Africa, backed by the Reagan administration, which would bar importation of the Krugerrand. On Nov. 13 Pretoria announced it was suspending production of the coin, which over the years has been a favorite of investors and collectors.
We would urge the House to give its consent to production of the new US gold coin, which would come in four sizes: 1 oz, 1/2 oz, 1/4 oz, and 1/10 oz. The cost of the coin for purchasers would also depend on the market price of gold, plus a sales commission. The gold coin would be the first ``general circulation'' gold coin in the US in more than 50 years, although buyers would presumably buy it for its investment potential.
Americans annually invest more than $1 billion in foreign gold coins. Roughly half of that money has gone to South Africa, for the Krugerrand. But Americans also buy gold Canadian Maple Leafs and Mexican bullion coins. Now, with the introduction of a US-minted, legal-tender gold coin, that investment money could stay in the United States. The new coins will be minted from domestically produced gold, or from gold in US reserves. The Treasury's profits from the sale of the new legal tender gold coins, inc identally, will be used to reduce the deficit. That seems reason enough for the new mintings.