Rising price of precious metals spurs the buying and selling of coins

By Charlie Mathews
MANITOWOC — Gold fever has hit Jim Lukes.
He's putting in 14-hour days at his downtown coin and stamp shop where the phone never seems to stop ringing while he tries to wait on several customers at a time.
"I tell people, 'you may own gold but don't be owned by it,'" said Lukes, who's bought and sold the precious metal since 1977.
Earlier this month, gold briefly cracked the $1,000 an ounce barrier, and the price is up about $300 compared to a year ago.
Blame — or credit — goes to a weakening U.S. dollar, with gold a traditional inflation hedge. "Gold should be just part of a good investment portfolio," said Lukes.
He buys and sells U.S. government minted American Eagle gold coins, acceptable as legal tender for purchases, in $5, $10, $25 and $50 denominations.
The selling price on Wednesday was $105 for the one-tenth ounce coin, $255 for a quarter-ounce $10 piece, $500 for a half-ounce coin, and $990 for the one-ounce $50 coin.
Lukes explained the U.S. Treasury sells the American Eagles to 13 hand-picked suppliers.
"The public can't buy directly from the Mint, nor me," he said. "I have to buy from one of these built-in middlemen, worse still."
He said his supply of gold coins is at the mercy of the public, "who I like buying from to save shipping costs," the suppliers, "who are never generous or lenient no matter which way the price is going," and other dealers with whom he trades.
"You don't have to be authorized to sell gold, so when there is a gold rush, the charlatans and crooks pop up," Lukes said. He blasts the individuals who blow into town, set up a shop at a local hotel, "buy from the good citizens and get the heck out.
"Whereas, the local guy has been around for 31 years and has to keep his nose clean because people know where he is," said Lukes, from his store at 815 Jay St. Lukes said the heightened interest in gold does have a positive impact on his business, despite a minimal profit margin.
He said individuals may revive or begin a coin or stamp collecting hobby. Lukes then has the opportunity to make his livelihood buying and selling rare items.
'Rough times' good for Dan Zirk Owner of Manitowoc Card & Coin, 3519 Custer St., Dan Zirk also has been busy in recent weeks, but mostly with silver.
"This is Manitowoc and we're not a rich town," said Zirk, with silver currently selling for about $19 an ounce, up about 40 percent from $13.50 a year ago. In business for 21 years, Zirk said he'll leave stocking gold coins to Lukes.
"Like gold, some people are investing in silver as part of their portfolio, as opposed to putting money into the stock market, which many think will tank," Zirk said.
He believes many individuals like the "physical feel" of their precious metal investment, the ability to touch the gold and silver. "It's been that way for thousands of years," Zirk said.
He said he makes a minimal profit on escalating gold and silver prices, and also generates more revenue off collector coins.
Zirk has had a surge in customers bringing in gold wedding bands and necklaces that he weighs, prices out, and sells to another dealer who eventually ships the items to a smelter.
"When gold and silver go up, people sometimes sell things they don't want to sell, like a pile of silver dollars from their grandma," Zirk said. "But they may need to make a house payment. When times get rough, it's good for me."
Charlie Mathews: (920) 686-2969 or cmathews@htrnews.com
Source: USA Today and Encyclopedia Brittanica

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