2018 Hard Asset Collector’s Holiday Buying Guide

2018 Hard Asset Collector's Holiday Buying Guide
Photo Credit: LOPRE

Welcome to the Antique Sage’s 2018 hard asset collector’s holiday buying guide, where I will help you choose the finest Christmas gifts for the tangible asset enthusiast, antique collector or other special person in your life.

 

Vintage British Sterling Silver Hallmark Pendants

In the 1970s rampant international inflation led to a widespread loss of confidence in fiat currencies.  As a result, gold and silver bullion investing was all the rage.

So it shouldn’t be surprising that British High Street jewelers adapted to the times by crafting sleek, ingot shaped pendants for the fashion conscious.  These lovely British sterling silver hallmark pendants have a streamlined sensibility that fits well with the modern aesthetic.

Although most were produced in the late 1970s, vintage British hallmark pendants can date anywhere from the mid 1970s to the early 1980s.

Each one of these pendants is made from high purity, .925 fine sterling silver.  This is attested to by the stately lion hallmark, which has been used to certify the purity of English sterling silver since the mid 16th century.

Collectors love the fact that the British hallmarking system is so well regulated.  It easily allows anyone to identify a piece of jewelry’s city and date of manufacture, along with its maker.

For example, a leopard’s head hallmark indicates a piece was made in London.  An anchor hallmark is the symbol for Birmingham and a crown hallmark is the emblem for Sheffield.

As an added bonus, pendants made in 1977 were given a special, one-year-only hallmark with the head of Queen Elizabeth II in commemoration of her 25th coronation anniversary jubilee.

With prices ranging from only $25 to just over $100, a vintage British sterling silver hallmark pendant from the 1970s would not only make a great gift, but also be eminently affordable.

 

Japanese-Style Woodblock Art Prints

Moku Hanga is the term for traditional Japanese woodblock printing.  And truth be told, I have fallen in love with these masterpieces – hence their positioning in the hard asset collector’s holiday buying guide.

Japanese-style woodblock printing has become so popular that Western artists have fully embraced it, turning out some really compelling original art prints.  This is partially because Moku Hanga is an art that demands to be mastered.

But it is also an art form that demands respect.  As a result, classic Japanese themes like nature, animals and landscapes often dominate, even in Moku Hanga prints produced by non-Japanese artists.

In the typical Japanese-style art print, the artist painstakingly carves a flat block of cherry, birch or shina wood with a special, razor-sharp tool.   Then an additional block using a slightly modified design must be carved for each different color in the final print.

The print itself is usually transferred onto high quality, acid-free paper that is either cotton or mulberry-bark based.  This ensures that the resulting Moku Hanga art print will last for centuries to come.

Pricing is usually quite reasonable, with many fine Japanese-style woodblock prints available for just $100 to $200.

 

Antique Fractional European Gold Coins

Everybody loves gold coins.  And nearly everyone is familiar with modern gold bullion coins like the American gold eagle, the Australian kangaroo and the Canadian maple leaf.

But did you know that during the late 19th and early 20 century, many European countries struck small gold coins for circulation?  These intriguing coins are often well over a hundred years old and hail from some of the most storied nations of the time.

For example, the French, Belgians and Swiss – as part of the ill-fated Latin Monetary Union – struck 20 franc coins that contained 0.1867 troy ounces of pure gold.  The British minted their internationally renowned gold sovereign coin (0.2354 troy ounces), which is still being issued to this day.  Germany’s workhorse denomination was the 20 mark coin, which sported 0.2304 troy ounces of fine gold.  And Czarist Russia struck both 5 rouble (0.1244 troy ounce) and 10 rouble (0.2489 troy ounce) gold coins bearing the legendary double-headed imperial eagle.

But perhaps most surprisingly, these desirable antique gold coins are rather affordable today.  In fact, common specimens in nearly uncirculated condition rarely go for much more than bullion value.

Because of this, old fractional European gold coins earn their place on the hard asset collector’s holiday buying guide.  With spot gold trading at around $1,200 a troy ounce, most of these coins are trading just under $300, although some smaller pieces can be purchased for less.

 

Handcrafted Fine Hardwood Jewelry Boxes

I’ve always believed that a fine gift should be presented in an exceptional box.  And that’s why I’ve decided to feature handcrafted hardwood jewelry boxes on the Antique Sage’s 2018 hard asset collector’s holiday buying guide.

These exquisite storage boxes use some of the finest temperate and tropical hardwoods known to man.  Magnificently-grained exotic woods like koa, mahogany, walnut and sapele, not to mention elegant wood burls, vie for your attention on these works of art.

Although I call them jewelry boxes, the fact is that almost any compact treasure can be stored in these boxes.  They could just as easily accommodate cherished family photos and keepsakes as valuable watches and jewelry.

And they are durable as well.  If properly cared for, a well-made hardwood jewelry box will easily last a lifetime.

Given the superb craftsmanship and beauty of handmade hardwood boxes, their $50 to $200 price tag seems absurdly low.

 

Artisan Hand-Poured Silver Bars

There is nothing quite like holding a hefty bar of pure silver in your hands.  It is at once covetable and gorgeous; the essence of true wealth.

One of the most intriguing trends in the silver-stacking community is the proliferation of artisan-made silver bars.  These works of art are cast from .999 fine silver that is hand-poured into graphite or iron molds before being hand-stamped with their maker, weight and fineness.  Each poured silver bar is absolutely one-of-a-kind, with unique pour lines and irregularities.

Because hand-poured bars are more labor intensive to make than struck or extruded silver bars, the large bullion fabricators do not make them anymore.  So the torch has been taken up by specialized firms that are crafting these artisan silver bars in small batches.

One of my favorite makers of hand-poured silver bars is Vulture Peak Mines, also known as VPM.  They are a poured-bar specialist company located in Bandon, Oregon, on the Pacific Coast.  Most of VPM’s employees are former miners or veterans, all of whom share a passion for poured silver bullion.

The wonderful thing about artisan hand-poured silver bars is that most of them only sell for modest premiums over the spot price of silver.  For instance, with the spot price of silver currently at $14.50, you can expect to pay a very reasonable $22 per troy ounce for VPM poured silver bars, give or take.

 

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1937 British Proof Set for King George VI’s Coronation

1937 British Proof Set for King George VI's Coronation
Photo Credit: EnglishCoinCompany

1937 British Proof Set for King George VI’s Coronation

Asking Price: $616 (price as of 2018; item no longer available)

Pros:

-The United Kingdom issued this magnificent 15-coin 1937 British proof set to commemorate the coronation of King George VI.

-This King George VI coronation proof set consists of 15 different coins.  Seven coins are regular circulation silver pieces: a crown (5 shillings), 1/2 crown (2 1/2 shillings), florin (2 shillings), 2 different designs of shillings, a sixpence and a threepence.  Four coins are silver Maundy issues: a groat (4 pence), threepence, twopence and a silver penny.  The remaining four coins are base metal: a brass threepence, bronze penny, half-penny and farthing (1/4 penny).

-This lovely proof set comes with its original silk-lined, red box!  Early 20th century British proof sets have some of the best original packaging of any proof sets.  They are absolutely classic – just what you would expect from an august institution like the Royal Mint.

– Before decimalization, 1 pound equaled 20 shillings, while 1 shilling equaled 12 pence.  This made each pound worth 240 pence.  Thankfully, this unwieldy medieval currency system was finally phased out with the arrival of decimalization in 1971.

-This 1937 British proof set is a pre-World War II issue originating from a time when the British Empire was still intact.  It is a universal rule that coinage from an empire near its apogee is more desirable than coins minted during its decline.

-The face value of this 1937 British proof set totals 13 shillings and 5 3/4 pence.  This would have been equivalent to around $3.37 at prevailing 1937 exchange rates, or just under 1/10th of an ounce of gold.

-This classic British proof set includes Maundy money.  Maundy money is special coinage handed out by the monarch every year on Royal Maundy, the Thursday before Good Friday.  This uniquely British tradition has persisted since King Charles II first handed out these small silver coins in 1662.

-For much of the 20th century, Great Britain only issued proof sets for special occasions.  These included the coronation years of 1902 (King Edward VII), 1911 (King George V), 1937 (King George VI) and 1953 (Queen Elizabeth II).  Sets were also issued in 1927 (in honor of a coinage redesign), 1950 (to celebrate the end of WWII austerity) and 1951 (for the Festival of Britain).  The British Royal Mint didn’t begin striking proof sets every year until 1970.

-This vintage British proof set contains an impressive number of silver coins – 11 in total.  Like circulating British coinage of the time, all of these specimens were struck in 50% silver.  Until 1920, all British silver coins had been struck to the higher sterling standard.  But the incredible expense of World War I prompted the British government to adopt cost savings measures, including a lower standard for their silver coinage.  After World War II nearly bankrupted the U.K., all silver was removed from the country’s coinage in 1947.

-This 1937 British proof set has a mintage of only 26,402 sets.  This is relatively low, especially compared to 1950s and 1960s U.S. proof sets, which were generally issued in the hundreds of thousands or millions.

-Given the excellent condition of this vintage proof set and the fact that it is one of the few pre-modern British sets available, I find the $616 asking price to be fair.

 

Cons:

-In my opinion, the 1902 and 1911 British proof sets from the height of empire are much more desirable.  However, they are also significantly more expensive.  The 1927, 1937, 1950, 1951 and 1953 proof sets offer much more accessible price points for the aspiring coin collector or investor.

-This 1937 British proof set doesn’t include any gold coins.  Instead, there was a separately issued 4-coin gold proof set, which is highly desirable today.  Unfortunately, it is also extremely expensive (£9,500 at auction in 2018), with prices having risen considerably over the past 10 to 15 years.

-You can sometimes find these 1937 proof sets for less money, but they often contain coins that have been rubbed, scratched or otherwise compromised.  These are known in the field of numismatics as impaired proofs and should generally be avoided.

 

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U.S. Dollar Debasement – A Unique Historical Timeline

U.S. Dollar Debasement - A Unique Historical Timeline

Before Dollar Debasement: The Classical Gold Standard

Before the Great Depression, the United States operated under a gold standard.  This meant that most U.S. currency could be freely exchanged at banks or the U.S. Treasury for gold coins.  This was done at the rate of $20.67 for one troy ounce of gold.  In other words, a $20 gold certificate could be redeemed for a double-eagle gold coin which contained almost a full troy ounce of pure gold.

This conversion mechanism constrained growth in the money supply, meaning that there was effectively no inflation for as long as the system remained in place.  In addition, silver certificates that were directly redeemable for silver dollars also circulated in the economy, providing additional protection against U.S. dollar debasement.

The classical gold standard provided unprecedented financial stability and economic growth – not only in the United States, but also in other countries that had adopted it, including Great Britain, France, Germany and Japan.  It was only with the arrival of World War I that the international gold standard began to weaken.

 

  • Early 1900s – The U.S. economy is dominated by a variety of high quality currency instruments. Gold certificates, silver certificates, United States Notes and Federal Reserve Notes (after 1914) all circulate side-by-side, along with gold and silver coins.
  • 1913 – The Federal Reserve is founded as a “banker’s bank” with the stated purpose of preventing financial panics. The new institution’s policies will profoundly impact the trajectory of dollar debasement in the decades to come.
  • 1914 to 1918 – World War I forces most belligerent nations to abandon the gold standard. The United States is a notable exception to this trend, which cements the country’s position as an international economic power.
  • 1920s – A decade of economic expansion is driven by strong fundamentals and the newly formed Federal Reserve’s outrageous “coup de whiskey” monetary policy. This has grave consequences because it foments a massive Wall Street stock market bubble that surreptitiously undermines the economy.
  • 1929 – The Great Wall Street Crash in October signals the start of the Great Depression.
  • 1931 – The collapse of Credit-Anstalt, a major Austrian bank, ushers in the most virulent phase of the Great Depression.
  • 1931 – Great Britain is forced off the gold standard in September of this year, greatly increasing monetary pressure on all countries that still maintain gold convertibility, including the United States.
  • 1933 – Franklin Delano Roosevelt assumes the Presidency and immediately calls a banking holiday. He simultaneously suspends the gold convertibility of the U.S. dollar.  A short time later, on April 5, FDR effectively nationalizes the country’s gold, declaring that all privately-held gold coins and gold certificates must be exchanged for non-gold currency.
  • 1934 – FDR increases the price of gold from $20.67 to $35 per troy ounce. This effectively devalues the U.S. dollar by 41%.  The classical gold standard in the United States is officially dead and the modern era of dollar debasement begins.
  • 1934 – The U.S. Treasury commissions a final series of gold certificates. These are not intended for public circulation, but are instead used for bank reserves and inter-bank transfers.
  • 1935 – FDR passes a law allowing the U.S. Treasury to issue small-denomination, government-backed bonds, otherwise known as savings bonds, directly to the public. Savings bonds allow U.S. citizens to invest in a safe Treasury instrument with a competitive interest rate.

 

Dollar Debasement Begins: The Bretton Woods System

In the wake of the widespread devastation wrought by the Great Depression and World War II, a new international monetary framework was desperately needed.  As a result, in July 1944, 44 representatives of the allied nations, including Great Britain, the United States, France and the Soviet Union, gathered at Bretton Woods, New Hampshire to hammer out a new monetary system.

It was finally decided that the U.S. dollar would be convertible into gold at the rate of $35 for each troy ounce.  But only foreign governments and central banks would be allowed to exercise this conversion feature, not individuals.  In addition, all other countries would tie the value of their currencies to the dollar.

Although silver certificates and silver coins freely circulated in America during this period, gold bullion was illegal for U.S. citizens to own.  Each $1 silver certificate was exchangeable into a silver dollar containing 0.77344 troy ounces of pure silver.  United States Notes and Federal Reserve Notes also circulated and could be exchanged for fiduciary silver coinage (90% silver dimes, quarters and half dollars) which contained 0.7234 troy ounces of silver per $1 face value.

 

  • 1944 – The Bretton Woods system is formalized. This monetary structure is quickly adopted by most nations that are not part of the Soviet Communist Bloc.
  • 1950s – A period of international prosperity exists, with the United States acting as both the world’s monetary hub and primary export destination. However, the United State’s huge silver and gold reserves are gradually drawn down to pay for this flood of foreign imports.
  • Early 1960s – The rising price of silver in the international market makes it clear that the U.S. government will soon have difficulty redeeming silver certificates at their traditional rate.
  • 1964 – The U.S. government suspends the Treasury’s obligation to redeem silver certificates for silver dollars, but still allows redemption for raw silver granules or bullion bars for a limited time.
  • 1964 – U.S. citizens are allowed to legally own gold certificates again. While they regain their legal tender status, they are no longer redeemable for gold.
  • 1966 – The U.S. Mint strikes its last 90% silver coins meant for circulation (which are dated 1964 due to a date freeze). The only circulating U.S. coins with any precious metal remaining are 40% silver Kennedy half dollars.  Most U.S. coinage is now copper-nickel slugs.
  • 1968 – The U.S. Treasury discontinues redeeming silver certificates in their entirety, although the notes still remain legal tender.
  • 1969 – The U.S. Treasury withdraws high denomination currency from circulation due to fears that it facilitates organized crime. But honest citizens who crave financial discretion and safety are most impacted.  This policy applies to the $500, $1,000, $5,000 and $10,000 bills.  These large denomination notes are not, however, demonetized.
  • 1970 – The 40% silver Kennedy half dollar is discontinued and replaced with a copper-nickel base metal version. There are now no coins produced by the U.S. Mint for general circulation that contain any silver.
  • 1971 – In August, President Richard Nixon stops redeeming U.S. dollars presented by foreign governments and central banks for gold. This ends the last formal link that the U.S. dollar has to precious metals, marking a new era in dollar debasement.  All currencies in the world are now fiat currencies with floating exchange rates.
  • Early 1970s – By this time, nearly all 90% U.S. silver coinage (especially dimes and quarters) have been pulled from circulation due to Gresham’s Law.
  • 1973 – An international oil crisis is precipitated when Arab nations refuse to exchange their oil for now depreciated U.S. dollars at the traditional rate.
  • 1975 – After more than 40 years of being illegal, gold ownership for U.S. citizens is re-legalized.

 

Dollar Debasement Accelerates: The Bretton Woods II System

After the monetary chaos of the 1970s, which was characterized by persistently high inflation and frequent recessions, a monetary reform was necessary.  The U.S. Federal Reserve raised short-term interest rates to a dizzying 20% in 1980 in order to break the economy’s deleterious inflationary cycle.  Once confidence in the dollar had been reestablished, a reconstituted global monetary system emerged.

Unlike the original Bretton Woods System, the Bretton Woods II System was entirely informal.  While the U.S. dollar remained at the center of the global monetary system as the world’s reserve currency, it was no longer exchangeable for gold or silver at a fixed rate.  Instead, all currencies floated freely against each other.

The United States also remained the world’s primary destination for exported goods, gradually leading to a slow deindustrialization of the country.

 

  • 1980 – A bubble in precious metals – gold, silver and platinum – finally bursts after the Federal Reserve raises short-term interest rates to unbelievably high levels.
  • 1982 – The U.S. Government bans the issuance of new bearer bonds. This is a blow to financial anonymity because these corporate promissory notes are similar to cash; whoever holds them receives their interest and principal payments.  However, existing bearer bonds are allowed to mature naturally.  Because the maximum term of a bond is typically no more than 30 years, the last of these bearer bonds mature by 2012.
  • 1980s – A period of relative economic prosperity develops as the Federal Reserve’s relatively cautious interest rate policies discourage widespread speculation.
  • 1986 – The U.S. Mint begins striking American Gold and Silver Eagle bullion coins, giving small investors a good way to accumulate precious metals with confidence.
  • Late 1990s – The advent of the original technology bubble ushers in an era of destabilizing, serial boom-bust financial markets. This development is encouraged by a profligate Federal Reserve that reliably “bails-out” bubble speculators.
  • Mid 2000s – The Federal Reserve holds short-term interest rates too low for too long, giving rise to the Housing Bubble.
  • Mid 2000s – Due to the rising price of precious metals, the last remnants of pre-1970 silver coinage finally disappear from circulation. Looking through rolls of coins from your local bank in hopes finding the odd silver Kennedy half dollar or silver war nickel is now a lost cause.
  • 2008 – The Great Financial Crisis strikes when the Housing Bubble bursts. The Federal Reserve lowers interest rates to almost zero, causing significant dollar debasement.  The Fed, in effect, subjects the American people to intense financial repression in order to recapitalize the irresponsible banking system.
  • Late 2000s – The U.S. Treasury systematically lowers the interest rates it pays on savings bonds, making them far less attractive investments to small savers than they used to be.
  • 2009 – New York City’s centralized clearinghouse for stock settlements adds a $500 fee to the cost of issuing new paper stock certificates, effectively ending their creation. However, existing paper stocks certificates are allowed to remain outstanding.
  • 2012 – The U.S. Government states that it will no longer issue physical savings bonds certificates. From now on all U.S. savings bonds are digital only, with only one minor exception.  This is the death knell of the U.S. savings bond program.
  • 2013 – The Depository Trust & Clearing Corporation (DTCC) proposes the elimination of all physical stock certificates. This would make it impossible to hold stocks anywhere except for a brokerage account or DRIP plan.
  • 2010s – The Federal Reserve again suppresses short-term interest rates, inflating a grotesque, hybrid Real Estate/Stock Market/Bond Market/Crypto-Currency Bubble. When it finally bursts, the economic fallout will be catastrophic.
  • 2016 – Several stories run in the media in favor of discontinuing the $100 bill – ostensibly because of their alleged use in criminal transactions. This is in spite of the fact that a $100 bill in 2016 only has the same purchasing power as a $10 bill in 1950.

 

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Vintage Pelikan 400NN Fountain Pen & Mechanical Pencil Set

Vintage Pelikan 400NN Fountain Pen & Mechanical Pencil Set
Photo Credit: THE-ANTIQUE-SHOP-OF-RUMEN

Vintage Pelikan 400NN Fountain Pen & Mechanical Pencil Set

Buy It Now Price: $299 (price as of 2018; item no longer available)

Pros:

-This vintage Pelikan 400NN fountain pen and mechanical pencil set from the late 1950s or early 1960s has striking brown tortoise-striped barrels contrasting with gold-plated trim.

-The Pelikan 400NN fountain pen measures 5.12 inches (13.0 cm) in length.  Although I do not have the exact measurement for the matching mechanical pencil, we can see from the photo that it is slightly longer than the pen.

-Pelikan was founded in Hanover, Germany in 1832 as a supplier of paints and inks.  However, it was not until the late 1920s that the company began producing fountain pens.  Pelikan’s golden age came in the post-WWII era of the 1950s and 1960s when it produced many memorable, high quality pens.  Pelikan remains a respected pen manufacturer to this day.

–Vintage fountain pen sets are generally undervalued in today’s marketplace.  This allows the knowledgeable writing enthusiast or antiques investor to pick up some truly special pen sets at bargain prices.

-The Pelikan 400 series fountain pen was first produced in 1950 and eventually discontinued in 1956.  A revised version, the Pelikan 400N (the “N” stood for new) was briefly made in 1956.  The type featured here, the Pelikan 400NN, was manufactured from 1956 to 1965.

-This Pelikan 400NN fountain pen comes with its original 14 karat gold EF nib.  Many vintage pen aficionados consider Mid-Century Pelikans to be among the best pen-nib combinations ever made.

-According to the seller, this vintage Pelikan 400NN fountain pen and mechanical pencil set is in working order.  In addition, it appears be in excellent condition, with no visible brassing, cracking or discoloration.

-The 400 series is the iconic vintage Pelikan fountain pen from the historical apogee of the company.  According to specialist collectors’ website The Pelikan’s Perch, the Pelikan 400NN fountain pen (and its derivatives) are the “number one” vintage Pelikan pen for writing devotees.  In their own words, “If you can only have one vintage Pelikan pen, this is probably the one to get.”

-Although the Pelikan brand often sits in the shadows of more recognized luxury pen makers, like Montblanc and Waterman, it really deserves to be acknowledged as a full peer with these venerated competitors.  Because of this, I believe the $300 asking price for this beautiful fountain pen and mechanical pencil set is well justified.

 

Cons:

-While generally very robust pens, buyers of the Pelikan 400 series have to watch out for cracked barrels and collars.  This is due to a minor design flaw (a shrinking plastic cap over a static metal liner) and material limitations (a brittle, polystyrene collar).  Luckily, this particular Pelikan 400NN pen and pencil set shows no evidence of these issues.

-Although this vintage pen set is in a Pelikan case, I am dubious that it is original.  If the set was still housed in its original case, its value would be slightly higher.

 

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