Ed Moy's book on gold and platinum eagles

[Stephon-migration]

I recently bought Ed Moy's book on gold and platinum eagles and found it to be a very interesting and insightful read. The background information given in this book is in some ways better than the Bowers series books which Whitman published. There is one thing that did get my head scratching in Moy's book:

 

How does the mint price its numismatic products just enough to break even (plus a small margin to cover any potential losses so that taxpayers wouldn't have to subsidize collector purchases)? I find that hard to believe with the way the mint overprices their numismatic products. Why does the mint even make numismatic products and go crazy with the amount of products that they make to collectors if they're not really making any money, if any, off of it? If the mint isn't making money and going out of control with the amount of products that they come up with for collectors, then there really needs to be some reforms made over there.

[19Lyds]

I recently bought Ed Moy's book on gold and platinum eagles and found it to be a very interesting and insightful read. The background information given in this book is in some ways better than the Bowers series books which Whitman published. There is one thing that did get my head scratching in Moy's book:

 

How does the mint price its numismatic products just enough to break even (plus a small margin to cover any potential losses so that taxpayers wouldn't have to subsidize collector purchases)? I find that hard to believe with the way the mint overprices their numismatic products. Why does the mint even make numismatic products and go crazy with the amount of products that they make to collectors if they're not really making any money, if any, off of it? If the mint isn't making money and going out of control with the amount of products that they come up with for collectors, then there really needs to be some reforms made over there.

They don't break even Stephon.

 

The turn profits and those profits get turned over to the General Fund to pay down the national debt.

 

In 2012, the annual report states:

 

"At September 30, 2012 and 2011, the Mint transferred excess receipts to the Treasury General Fund of $77 million and $51 million, respectively. "

 

The 2010 Report, under Ed Moy, stated:

 

"Consequently, the United States Mint PEF generated a $388.0 million return to the Treasury General Fund, an 18.3 percent decrease from the $475.0 million return in FY 2009. "

 

Aw man! They did not have nearly the profits in 2010 ($388 Million) as they did in 2009 ($475 million). These "profits are everything is said and done with all bills paid which includes operating expenses, supplies and equipment.

[Stephon-migration]

I saw your reply ATS. But I'll reply here with another head scratcher from Moy's book:

 

Here's another thing for your to ponder on from Moy's book. The mint makes seigniorage profits off of the bullion coins. I wonder how that's the case when you charge a certain percentage premium to the authorized purchaser which is supposed to, again, break even on production costs? I thought that seigniorage only existed when the costs of production of a coin is below the face value of the coin. I didn't know that it cost less than $50 to make a 1 oz AGE

[19Lyds]

I saw your reply ATS. But I'll reply here with another head scratcher from Moy's book:

 

Here's another thing for your to ponder on from Moy's book. The mint makes seigniorage profits off of the bullion coins. I wonder how that's the case when you charge a certain percentage premium to the authorized purchaser which is supposed to, again, break even on production costs? I thought that seigniorage only existed when the costs of production of a coin is below the face value of the coin. I didn't know that it cost less than $50 to make a 1 oz AGE

What more needs to be said about Moy's particular form of coin knowledge?

 

Seigniorage is the difference between what it costs to make vs what it is sold to the Federal Reserve for.

 

There is no way that seigniorage apply to bullion collector coins and I am glad that he's no longer the Mint Director although Richard Peterson is NOT a real big step in the right direction..

[RWB]

In 19th-20th century usage "seigniorage" is the amount remaining between the total cost of materials and manufacture, and the face value of the coin. This could be either positive or negative.

 

Strictly, it could be applied to modern bullion pieces, but would always be a negative number unless the face value exceeded the bullion and manufacture costs.

 

Non-mint expenses - transportation, shipping, insurance - were not part of standard seigniorage calculations.

[Conder101]

Seigniorage is the difference between what it costs to make vs what it is sold to the Federal Reserve for.

If you consider it to be the difference between the cost of manufacture and what you sell them for, then the difference between the cost to produce the bullion coins and what they sell them to the distributors for could be called seigniorage. But usually we just call that profit.

[GoldFinger1969]

The turn profits and those profits get turned over to the General Fund to pay down the national debt.

 

These sums are nothing to the profits of the Fed in check clearing and Open Market Operations.