Make Sure All That Glitters is SOLID Gold

Ever since I can remember, gold has been the color of the holiday season. Even though ice and snow offer more of a silvery tone, retailers consistently showcase gold as the "gift of choice," whether it be in jewelry or coins. When buying either, it's key to look below the surface and know the actual value.

Maybe it's because of gold's current high price, but more gold-plated coins are being advertised than I've seen before. Usually, they're the U.S. state quarters or golden presidential dollar coins. Weekly, on television or in national publications, companies offer them plated in "pure 24-karat gold."

Understand these are the same coins available at many banks and coin dealers and from the Mint but coated in gold. The gold coating is often defined in microns — a layer so microscopically thin it would all but evaporate if not adhered to a surface.

The gold-plated coins can sell for anywhere between $2.50 and $10 apiece. One recent promotion offered four gold-plated dollar coins for $9.95. However, the shipping was an extra charge of $10. Uh … wow. Sets of five gold-plated state quarters have sold for around $25 — 20 times their face value.

I mention face value for a reason. I spoke with five dealers about the current spate of gold-plated coins. Each had the same response when asked what they would pay for them — face value. Most said they don't carry the coins, and some won't even buy them. Another explained they believed it would cost more to extract any tiny amount of gold on the coins than the gold itself was worth.

That seems to be at odds with the sales copy in some ads with wording such as, "Virtually guaranteed to soar in collecting interest." One definition of the word "virtually" is "almost." And, there's a hefty difference between collector "interest" and collector value. Other copy reads, "The coins look and feel like expensive gold coins." Yeah, but they're not.

The dealers I spoke with are hoping word will get out about these coins so buyers won't be disappointed. Moreover, the local dealers don't want to look like the bad guys when they offer a fraction of what was paid or refuse to buy the coins at all.

Christmas is a time when people wish each other, "Many happy returns." For those who have purchased gold-plated common coins, I'd encourage a similar course of action. When purchased by mail, by law, you have 30-days in which you can return them for a full refund. According to the dealers I talked to, you'll be happy with that return.

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The previous caveat might lead you to believe a common object can't become more valuable by modifying in some way. Not true. A case in point would be envelopes containing a special stamp or cancel commemorating an event. Available to the public for roughly the price of the stamp, most end up as keepsakes of little value.

The difference comes when something common becomes uncommon. Case in point — in 1989, the small town of Ligonier, Penn., named its local train station after golfing legend and native son Arnold Palmer. For the occasion, a commemorative envelope bearing the golfer's portrait and a special cancel on a common 25-cent stamp was issued. Several hundred might have been sold for around a buck — roughly the same as they're worth now, some 18 years later.

Palmer may have been in attendance. Or, an enterprising person could have sought him out later and asked him to sign the envelope. Either way, that signature took the envelope's value from a dollar to between $300 and $400.

The same can happen to many common collectibles issued annually. The trick is to be creative and enterprising and to politely seek out someone connected to the event.

(Editor's Note: A JPEG visual of an envelope with Arnold Palmer's autograph is being sent for your use with this week's column.)

To find out more about Peter Rexford and to read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate Web page at www.creators.com.

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