1 00:00:02,480 --> 00:00:19,200 Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. Hello and welcome to 2 00:00:19,280 --> 00:00:23,560 Speaker 1: another episode of the Odd Lots podcast. I'm Jill Wisenthal. 3 00:00:23,200 --> 00:00:24,360 Speaker 2: And I'm Tracy Alloway. 4 00:00:24,800 --> 00:00:28,160 Speaker 1: Tracy, you've actually benefited a little bit from this move 5 00:00:28,240 --> 00:00:30,400 Speaker 1: up in gold lady. Right, you're a bit of a 6 00:00:31,000 --> 00:00:31,920 Speaker 1: bullion hoarder. 7 00:00:32,000 --> 00:00:32,200 Speaker 3: Right. 8 00:00:32,400 --> 00:00:34,200 Speaker 2: I thought you were about to call me a gold bug. 9 00:00:34,440 --> 00:00:36,960 Speaker 1: I know, I know you're not a full on gold bug. 10 00:00:37,040 --> 00:00:39,240 Speaker 1: You're a but you're like gold bug adjacent or silver 11 00:00:39,280 --> 00:00:40,800 Speaker 1: bug adjacent or something like that. 12 00:00:41,120 --> 00:00:44,680 Speaker 2: I let me just be clear. I have inherited my 13 00:00:44,840 --> 00:00:48,479 Speaker 2: long gold position, I guess, and silver as well. So 14 00:00:48,640 --> 00:00:52,600 Speaker 2: for some reason, every year, for my birthday and for Christmas, 15 00:00:52,640 --> 00:00:55,120 Speaker 2: my dad gives me either a gold coin or a 16 00:00:55,160 --> 00:00:58,520 Speaker 2: silver coin from his personal collection. He got it in 17 00:00:58,600 --> 00:01:02,640 Speaker 2: his mind that, like I, I really enjoy coins, I guess, 18 00:01:02,680 --> 00:01:05,880 Speaker 2: and now I kind of do. There is something satisfying 19 00:01:06,200 --> 00:01:09,760 Speaker 2: about having physical coins and sitting there. And I don't 20 00:01:09,800 --> 00:01:12,240 Speaker 2: stack them on YouTube or anything, but I do like 21 00:01:12,319 --> 00:01:14,880 Speaker 2: to check occasionally that they're still there, and I do 22 00:01:14,959 --> 00:01:18,520 Speaker 2: get a little bit of satisfaction when I look at 23 00:01:18,560 --> 00:01:20,959 Speaker 2: my little, my little pile of gold and silver. 24 00:01:21,560 --> 00:01:24,000 Speaker 1: I have to say, you know the one thing. I 25 00:01:24,040 --> 00:01:27,880 Speaker 1: don't own any physical gold. I do like the idea 26 00:01:27,880 --> 00:01:29,720 Speaker 1: of owning a bunch of silver and stacking it on 27 00:01:29,800 --> 00:01:32,400 Speaker 1: a table and doing a YouTube video about that. Everyone 28 00:01:32,400 --> 00:01:34,680 Speaker 1: should go look at the silver stackers on YouTube that 29 00:01:34,800 --> 00:01:37,440 Speaker 1: you're great. I would be scared, you know, you could 30 00:01:37,480 --> 00:01:40,800 Speaker 1: like bury them somewhere like out in the wilderness of Connecticut. 31 00:01:41,319 --> 00:01:43,800 Speaker 1: I would be scared to hold a lot of buoyon 32 00:01:43,840 --> 00:01:46,440 Speaker 1: on my person. And then I would be scared to 33 00:01:46,480 --> 00:01:49,280 Speaker 1: hold them in a bank because if everything goes bad, 34 00:01:49,400 --> 00:01:51,040 Speaker 1: is the bank even going to be open in a 35 00:01:51,080 --> 00:01:54,040 Speaker 1: safe deposit box? So I like the idea in theory 36 00:01:54,080 --> 00:01:57,400 Speaker 1: of having a lot of precious metal. Anyway, precious metal 37 00:01:57,400 --> 00:01:58,600 Speaker 1: has been doing really well lately. 38 00:01:58,680 --> 00:02:00,960 Speaker 2: It has. I was just looking at chart of gold. 39 00:02:01,120 --> 00:02:05,280 Speaker 2: So it hit another record high just at sort of 40 00:02:05,280 --> 00:02:08,000 Speaker 2: mid April, and then it came down quite a bit, 41 00:02:08,120 --> 00:02:11,000 Speaker 2: and now it's up again, like we're almost back to 42 00:02:11,200 --> 00:02:11,840 Speaker 2: that record. 43 00:02:12,080 --> 00:02:15,520 Speaker 1: It's pretty extraordinary. Gold is is sort of living up 44 00:02:15,560 --> 00:02:17,679 Speaker 1: to the hype because there's all this chaos and all 45 00:02:17,800 --> 00:02:20,720 Speaker 1: everything in the markets and the economy and politics, and 46 00:02:20,919 --> 00:02:21,520 Speaker 1: gold is up. 47 00:02:21,560 --> 00:02:24,480 Speaker 2: So yeah, yes, you know what I like about gold? 48 00:02:24,639 --> 00:02:27,720 Speaker 2: Tell me I like the advertisements that you see on TV. 49 00:02:28,400 --> 00:02:31,920 Speaker 2: And the interesting thing to me is like, obviously the 50 00:02:32,000 --> 00:02:34,800 Speaker 2: companies that are doing those ads are pitching an investment, 51 00:02:35,200 --> 00:02:38,040 Speaker 2: but so much of the investment pitch is sort of 52 00:02:38,280 --> 00:02:42,360 Speaker 2: mixed up with cultural values totally. So for instance, I 53 00:02:42,400 --> 00:02:45,920 Speaker 2: was watching one earlier in preparation for this episode, and 54 00:02:45,960 --> 00:02:49,359 Speaker 2: they were talking about how when you're walking down inflation 55 00:02:49,639 --> 00:02:55,840 Speaker 2: Boulevard and global instability Avenue, you really need the safety 56 00:02:56,160 --> 00:03:01,400 Speaker 2: of a gold coin, which not only represents security via gold, 57 00:03:01,440 --> 00:03:05,040 Speaker 2: but also the security of the United States of America. 58 00:03:05,200 --> 00:03:09,399 Speaker 2: Like you get all these cultural references wrapped up in coins. 59 00:03:09,160 --> 00:03:12,200 Speaker 1: At one hundred percent, and every coin has its design 60 00:03:12,280 --> 00:03:16,000 Speaker 1: and evokes all this stuff about heritage and everything. Anyway, 61 00:03:16,080 --> 00:03:19,520 Speaker 1: I'm really excited because we actually do literally have the 62 00:03:19,600 --> 00:03:23,600 Speaker 1: perfect guest because it touches on many things that were 63 00:03:23,639 --> 00:03:27,080 Speaker 1: interested in. It's someone who I've actually known for a while, 64 00:03:27,080 --> 00:03:30,120 Speaker 1: I've talked to before, someone who we're going to talk 65 00:03:30,160 --> 00:03:35,200 Speaker 1: about coins, but we're not going to talk about well, let's. 66 00:03:34,960 --> 00:03:36,320 Speaker 2: Just my most hated coin. 67 00:03:36,440 --> 00:03:39,160 Speaker 1: Yeah, see, there's one coin that Tracy hates. So we 68 00:03:39,200 --> 00:03:42,240 Speaker 1: are going to talk to Philip Deal. He is the 69 00:03:42,280 --> 00:03:46,640 Speaker 1: President of the US Money Reserve which sells gold. He 70 00:03:46,760 --> 00:03:50,320 Speaker 1: was also I think one of the great mint directors 71 00:03:50,320 --> 00:03:53,080 Speaker 1: in US history. He was the thirty fifth director of 72 00:03:53,120 --> 00:03:58,680 Speaker 1: the US Mint, where he, among other things, had numerous accomplishments. 73 00:03:58,720 --> 00:04:02,240 Speaker 1: He was instrumental in the sakajuwea dollar or a dollar 74 00:04:02,320 --> 00:04:05,520 Speaker 1: coin that was very successful lease sold to collectors. He 75 00:04:05,680 --> 00:04:08,920 Speaker 1: was behind the fifty State Quarters project, which if you 76 00:04:08,960 --> 00:04:11,120 Speaker 1: remember the nineties, they made a quarter for each of 77 00:04:11,160 --> 00:04:14,480 Speaker 1: the states. Turns out our producer Dash has all of 78 00:04:14,480 --> 00:04:16,720 Speaker 1: the fifty state quarters, which I didn't know and we're 79 00:04:16,720 --> 00:04:19,440 Speaker 1: not going to talk about this, although maybe relevant again 80 00:04:19,480 --> 00:04:21,400 Speaker 1: with the dead sealing come up. He was also the 81 00:04:21,440 --> 00:04:23,839 Speaker 1: one that got the language in the law that in 82 00:04:23,960 --> 00:04:28,240 Speaker 1: theory allows for the creation of a platinum coin of 83 00:04:28,720 --> 00:04:31,880 Speaker 1: high denomination which could be used to circumvent the dead sealing. 84 00:04:32,000 --> 00:04:34,040 Speaker 1: We're not going to talk about the trillion dollar coin 85 00:04:34,120 --> 00:04:36,839 Speaker 1: on this episode. We are going to talk about gold coins. 86 00:04:37,240 --> 00:04:40,680 Speaker 1: Philip Deal thrilled to have you on to talk now, 87 00:04:40,839 --> 00:04:42,280 Speaker 1: appreciate you coming on Odd Laws. 88 00:04:43,200 --> 00:04:45,480 Speaker 3: It's great to be on. I've looked forward to this. 89 00:04:46,360 --> 00:04:49,799 Speaker 1: I'm so excited. Tell us about uh where to start 90 00:04:49,800 --> 00:04:53,200 Speaker 1: even just tell us you're what the US Money Reserve 91 00:04:53,360 --> 00:04:56,480 Speaker 1: is so people understand, you know where you're coming from. 92 00:04:56,760 --> 00:04:59,000 Speaker 1: What is the business of the US Money Reserve. 93 00:05:00,360 --> 00:05:04,880 Speaker 3: We're a retailer of gold, silver, and platinum coins to 94 00:05:05,640 --> 00:05:11,360 Speaker 3: the US market. We sell mostly US government coins issued coins, 95 00:05:11,400 --> 00:05:16,760 Speaker 3: but also coins of other nations. We are probably in 96 00:05:16,839 --> 00:05:21,440 Speaker 3: the upper mid level of the marketplace, and I'd say 97 00:05:21,560 --> 00:05:25,320 Speaker 3: that we're different from our competitors because we market very differently. 98 00:05:25,400 --> 00:05:29,880 Speaker 3: I have a very different approach from what is typical 99 00:05:30,120 --> 00:05:33,640 Speaker 3: in the industry. This is something that I've really focused 100 00:05:33,640 --> 00:05:37,360 Speaker 3: on for the last several years. For example, all of 101 00:05:37,400 --> 00:05:41,359 Speaker 3: those advertisements that really harp on the end of the 102 00:05:41,400 --> 00:05:47,000 Speaker 3: world and how gold is your go to investment for 103 00:05:48,120 --> 00:05:51,960 Speaker 3: really hard times. A lot of that has meant. When 104 00:05:51,960 --> 00:05:55,599 Speaker 3: you look at the record, gold has performed extraordinarily well 105 00:05:55,600 --> 00:05:58,719 Speaker 3: over the last twenty five years in good times and 106 00:05:58,800 --> 00:06:03,200 Speaker 3: bad times. Great example of that is right now. Of course, 107 00:06:03,279 --> 00:06:07,320 Speaker 3: this has been a hard year for stocks, and stocks 108 00:06:07,360 --> 00:06:09,719 Speaker 3: are down probably the less time I check course this 109 00:06:09,880 --> 00:06:14,320 Speaker 3: change is daily that down about seven percent and gold 110 00:06:14,440 --> 00:06:17,560 Speaker 3: is up twenty seven percent this year. But last year 111 00:06:17,720 --> 00:06:21,320 Speaker 3: was a great year for stocks, and stocks were up 112 00:06:21,320 --> 00:06:25,080 Speaker 3: twenty three percent. The gold beat it it's twenty eight percent. 113 00:06:25,640 --> 00:06:28,039 Speaker 3: And when you look back over the last ten years, 114 00:06:28,440 --> 00:06:31,520 Speaker 3: five out a teen year gold has been beat this 115 00:06:31,680 --> 00:06:32,599 Speaker 3: and P five hundred. 116 00:06:33,480 --> 00:06:36,160 Speaker 2: To this point, my mom asked me last year if 117 00:06:36,200 --> 00:06:38,600 Speaker 2: she should invest in gold, and hate I hate it 118 00:06:38,640 --> 00:06:41,480 Speaker 2: when family members ask you these kind of questions because 119 00:06:41,760 --> 00:06:44,719 Speaker 2: I'm not in the business of providing investment advice. But 120 00:06:44,760 --> 00:06:47,479 Speaker 2: I told her, you know, sure, why not, just don't 121 00:06:47,480 --> 00:06:50,440 Speaker 2: put all of your money in gold. And now fast 122 00:06:50,440 --> 00:06:53,039 Speaker 2: forward like eight months, she's mad at me for not 123 00:06:53,160 --> 00:06:56,800 Speaker 2: recommending that she buy even more gold. She took apparently 124 00:06:56,920 --> 00:07:01,040 Speaker 2: a conservative position and should have been more. But maybe 125 00:07:01,040 --> 00:07:04,120 Speaker 2: I'll start with my most my biggest question, which is 126 00:07:04,720 --> 00:07:06,320 Speaker 2: what makes a coin popular. 127 00:07:07,360 --> 00:07:10,440 Speaker 3: Well, a number of factors go into it. One is 128 00:07:10,640 --> 00:07:16,239 Speaker 3: the denomination, for obvious reasons, the bigger the better. Also, 129 00:07:16,720 --> 00:07:23,040 Speaker 3: the metallic matters, gold more popular than silver. And design 130 00:07:23,480 --> 00:07:27,400 Speaker 3: also is hugely important, and this is something that we 131 00:07:27,520 --> 00:07:32,240 Speaker 3: really played on with a Sacagawea Golden dollar. It's important 132 00:07:32,240 --> 00:07:35,880 Speaker 3: that a coin be distinguishable to not be confused with 133 00:07:35,960 --> 00:07:40,680 Speaker 3: another coin. The Susan b Anthony had that reputation with 134 00:07:41,640 --> 00:07:45,640 Speaker 3: confusion with a quarter. Also, the design was not a 135 00:07:46,000 --> 00:07:50,920 Speaker 3: popular design Susan B. Anthony was not attractive on that design. 136 00:07:51,720 --> 00:07:54,440 Speaker 3: So one of the things we wanted to do when 137 00:07:54,600 --> 00:07:59,840 Speaker 3: we introduced the new dollar coin was to find a 138 00:08:00,240 --> 00:08:05,240 Speaker 3: topic that the topic itself would be hugely popular. And 139 00:08:06,400 --> 00:08:10,040 Speaker 3: the book Undaunted Courage had come out probably about a 140 00:08:10,120 --> 00:08:15,000 Speaker 3: year before we launched that coin, and of course a 141 00:08:15,080 --> 00:08:18,080 Speaker 3: part of that story was the story of Sakagawa and 142 00:08:18,200 --> 00:08:23,040 Speaker 3: her role in leading the Lewis and Clark expedition across 143 00:08:23,120 --> 00:08:27,640 Speaker 3: the Rocky Mountains, and that had really captured the imagination 144 00:08:27,800 --> 00:08:33,040 Speaker 3: of Americans, and especially the story of Sectia carrying her 145 00:08:33,400 --> 00:08:39,439 Speaker 3: infant son, John Baptiste on her back through that entire journey. 146 00:08:40,160 --> 00:08:44,920 Speaker 3: And we ended up having the design competition for a 147 00:08:45,040 --> 00:08:48,080 Speaker 3: design that fit that theme, and we ended up with 148 00:08:48,200 --> 00:08:53,200 Speaker 3: a beautiful design done by a goodacre And as a 149 00:08:53,240 --> 00:08:58,640 Speaker 3: result also we did a lot of market research on 150 00:08:58,760 --> 00:09:02,360 Speaker 3: what would be necessary to make this coin successful, and 151 00:09:02,400 --> 00:09:08,120 Speaker 3: when we launched it through a Walmart, they had people 152 00:09:08,160 --> 00:09:11,280 Speaker 3: standing in lines around blocks all over the country. We 153 00:09:11,440 --> 00:09:14,520 Speaker 3: have something like one hundred and fifty million of them 154 00:09:14,559 --> 00:09:19,280 Speaker 3: distributed within the first month, and it was an enormous success. 155 00:09:20,559 --> 00:09:23,280 Speaker 3: But one of the things that is always a challenge 156 00:09:23,760 --> 00:09:26,720 Speaker 3: for a dollar coin in the United States is you've 157 00:09:26,760 --> 00:09:30,040 Speaker 3: really got to withdraw the dollar bill when you introduce 158 00:09:30,160 --> 00:09:32,880 Speaker 3: the dollar coin. And that's been the case all through 159 00:09:33,000 --> 00:09:38,320 Speaker 3: the Western economies where the high denomination bill has to 160 00:09:38,360 --> 00:09:41,960 Speaker 3: our low denomination bill has to be eliminated when this 161 00:09:42,040 --> 00:09:43,800 Speaker 3: high denomination coin comes in. 162 00:09:59,000 --> 00:10:01,679 Speaker 2: How do you actually measure sure the success of a coin, 163 00:10:01,800 --> 00:10:04,360 Speaker 2: because if I think about something like the Sacagway a 164 00:10:04,480 --> 00:10:08,280 Speaker 2: dollar you're talking about. Initially there there was a lot 165 00:10:08,280 --> 00:10:11,400 Speaker 2: of interest in it, but I think like production didn't 166 00:10:11,480 --> 00:10:13,720 Speaker 2: last for very long, and there are some people out 167 00:10:13,760 --> 00:10:16,800 Speaker 2: there who would say, actually, it wasn't that popular with 168 00:10:17,160 --> 00:10:20,160 Speaker 2: investors or Americans over the longer term. 169 00:10:21,280 --> 00:10:25,000 Speaker 3: Yes, we really a circulating coin like the Sacatary Golden 170 00:10:25,080 --> 00:10:30,160 Speaker 3: dollar is successful if it circulates, if Americans use it 171 00:10:30,880 --> 00:10:36,240 Speaker 3: in commerce, and we saw one of the challenges you 172 00:10:36,400 --> 00:10:40,760 Speaker 3: face is a plane of the pump. Unless you get 173 00:10:41,080 --> 00:10:45,600 Speaker 3: a lot of coins in circulation immediately, then it doesn't 174 00:10:45,679 --> 00:10:51,520 Speaker 3: really enter circulation. And one of the constraints the coins 175 00:10:51,559 --> 00:10:55,400 Speaker 3: face is the change tray in a cash register. At 176 00:10:55,480 --> 00:10:57,640 Speaker 3: least that was the case twenty five years ago when 177 00:10:57,679 --> 00:11:01,800 Speaker 3: we were launching the golden dollar. Is not really a 178 00:11:02,040 --> 00:11:07,319 Speaker 3: place for a new denomination coin unless that is made 179 00:11:07,360 --> 00:11:11,839 Speaker 3: by the commercial unity by taking a quarter rolls out 180 00:11:11,880 --> 00:11:15,480 Speaker 3: of one of the bins. And so that was the 181 00:11:15,520 --> 00:11:19,080 Speaker 3: first big challenge that we faced. And you would think 182 00:11:19,600 --> 00:11:23,400 Speaker 3: that it would be relatively straightforward because the Federal Reserve 183 00:11:23,760 --> 00:11:28,400 Speaker 3: is our customer, the us Men's customer for circulating coinage. 184 00:11:28,960 --> 00:11:33,319 Speaker 3: The us MEN produces the coins, the Federal Reserve purchases 185 00:11:33,400 --> 00:11:36,520 Speaker 3: us them at a markup I believe it or not. 186 00:11:36,800 --> 00:11:41,760 Speaker 3: Us Men is a profit making enterprise, and then they 187 00:11:41,760 --> 00:11:44,920 Speaker 3: are distributed around the country, and then banks purchased them 188 00:11:44,920 --> 00:11:49,240 Speaker 3: from the Federal Reserve. But when we went to the 189 00:11:49,240 --> 00:11:54,360 Speaker 3: Federal Reserve in part of our market research and talked 190 00:11:54,400 --> 00:11:59,360 Speaker 3: to the banks, they still remembered sort of the disaster 191 00:11:59,480 --> 00:12:05,880 Speaker 3: that the Anthony launch had been twenty years actually forty 192 00:12:05,960 --> 00:12:09,680 Speaker 3: years earlier, and they said, well, all you have to 193 00:12:09,720 --> 00:12:13,480 Speaker 3: do is proved us that this coin will be accepted 194 00:12:13,480 --> 00:12:16,439 Speaker 3: by the American people and then we'll order it. Well, 195 00:12:16,440 --> 00:12:18,600 Speaker 3: that was a catch twenty two for us, because of 196 00:12:18,600 --> 00:12:21,040 Speaker 3: course unless they ordered it, we couldn't make it work. 197 00:12:21,679 --> 00:12:25,360 Speaker 3: And so I ended up going to Walmart and asking 198 00:12:25,360 --> 00:12:29,400 Speaker 3: if they'd be interested in launching the coin in all 199 00:12:29,559 --> 00:12:33,439 Speaker 3: Walmart and Sam's locations on the same day at the 200 00:12:33,559 --> 00:12:38,360 Speaker 3: end of January two thousand and they caught the vision 201 00:12:38,400 --> 00:12:41,320 Speaker 3: of what that would mean and was huge success for them, 202 00:12:41,679 --> 00:12:47,280 Speaker 3: and we produced over a billion Secretaria coins in that 203 00:12:47,400 --> 00:12:52,920 Speaker 3: first year and distributed them first through Walmart. We had 204 00:12:52,960 --> 00:12:58,160 Speaker 3: a contract with them to provide three hundred million sacagaris, 205 00:12:58,320 --> 00:13:00,480 Speaker 3: and we had to go back to them after the 206 00:13:00,520 --> 00:13:04,160 Speaker 3: first half had been delivered and say we need to 207 00:13:04,200 --> 00:13:06,960 Speaker 3: be we need to be let out of the second 208 00:13:06,960 --> 00:13:10,439 Speaker 3: half of that because now the banks are calling and 209 00:13:11,160 --> 00:13:14,680 Speaker 3: they haven't ordered any and they really unhappy that customers 210 00:13:14,880 --> 00:13:17,200 Speaker 3: come to them they don't have the sacagaria and they're 211 00:13:17,200 --> 00:13:21,040 Speaker 3: calling the the Secretary of the Treasury in the head 212 00:13:21,040 --> 00:13:24,920 Speaker 3: of the Federalserve and complaining. So we want to if 213 00:13:24,960 --> 00:13:26,679 Speaker 3: we want to take your of them as fast as 214 00:13:26,679 --> 00:13:30,640 Speaker 3: we can. So it was an enormous success, and not 215 00:13:31,040 --> 00:13:34,960 Speaker 3: just because people collected it, but because they were also 216 00:13:35,200 --> 00:13:40,240 Speaker 3: using it. But banks don't like coins, They like bows, 217 00:13:40,400 --> 00:13:44,000 Speaker 3: they don't like coins because coins are more expensive for 218 00:13:44,080 --> 00:13:47,679 Speaker 3: them to handle the ship, and we expected that there 219 00:13:47,760 --> 00:13:52,880 Speaker 3: was a natural resistance to it. My term expired in 220 00:13:52,960 --> 00:13:57,840 Speaker 3: early two thousand, so Secretaria lost a champion at the 221 00:13:57,840 --> 00:14:01,240 Speaker 3: top of the mint at that time, and it and 222 00:14:01,320 --> 00:14:03,719 Speaker 3: the momentum was lost over the next several. 223 00:14:03,520 --> 00:14:07,800 Speaker 1: Years, Tracy, I could listen to like technical detain stories 224 00:14:07,840 --> 00:14:12,000 Speaker 1: public yeah, and like you know, the fact about change 225 00:14:12,080 --> 00:14:14,680 Speaker 1: trays and the you know, and how difficult that is. 226 00:14:14,720 --> 00:14:17,439 Speaker 1: I could listen to that for a really long time. Also, 227 00:14:17,480 --> 00:14:21,040 Speaker 1: what I appreciate about this story is the sort of 228 00:14:21,080 --> 00:14:23,960 Speaker 1: the entrepreneurialism involved of like having to go out to 229 00:14:24,000 --> 00:14:25,360 Speaker 1: the Walmart and the SAMs. 230 00:14:25,040 --> 00:14:27,000 Speaker 2: And stuff that it's like a product launch, yeah, which we. 231 00:14:26,960 --> 00:14:30,520 Speaker 1: Don't normally associate with anything in the government for the 232 00:14:30,520 --> 00:14:34,200 Speaker 1: most part, except you know, the Mint is unique also 233 00:14:34,240 --> 00:14:36,880 Speaker 1: of course a policy entrepreneur. But we're not gonna we're 234 00:14:36,880 --> 00:14:39,440 Speaker 1: not going to talk about that specific area of the 235 00:14:39,520 --> 00:14:42,320 Speaker 1: trillion dollar coin. Okay, I'm on the US Money Reserve 236 00:14:42,440 --> 00:14:45,520 Speaker 1: website and I see that you have a one right 237 00:14:45,600 --> 00:14:48,000 Speaker 1: at today's price is a one ounce gold American Eagle 238 00:14:48,080 --> 00:14:51,120 Speaker 1: type two coin for three eight hundred and nine dollars 239 00:14:51,160 --> 00:14:54,680 Speaker 1: and seventy one cents a one out South African gold 240 00:14:54,760 --> 00:14:58,640 Speaker 1: krue Grand. Something very sexy about holding krewe Grand specifically, 241 00:14:58,680 --> 00:15:01,440 Speaker 1: I've always thought that's one eight hundred and six dollars 242 00:15:01,480 --> 00:15:05,200 Speaker 1: and thirty one cents same price for the Austrian gold 243 00:15:05,200 --> 00:15:06,480 Speaker 1: Harmonic Philharmonic coin. 244 00:15:06,640 --> 00:15:09,120 Speaker 2: Oh, I have one of those, really. Yeah, and I 245 00:15:09,160 --> 00:15:12,600 Speaker 2: have the Maria Theresa gold coins too. I probably shouldn't 246 00:15:12,600 --> 00:15:13,760 Speaker 2: say those podcast. 247 00:15:14,320 --> 00:15:15,960 Speaker 3: You have one hundred of these coins and give the 248 00:15:16,000 --> 00:15:16,960 Speaker 3: location at home. 249 00:15:17,080 --> 00:15:20,280 Speaker 1: Yeah, and then also some silver coins that depict battles. 250 00:15:20,360 --> 00:15:21,880 Speaker 1: But I want to just ask a little bit about 251 00:15:21,920 --> 00:15:24,560 Speaker 1: the sort of basic supply chain here of some of 252 00:15:24,600 --> 00:15:27,840 Speaker 1: these coins. So these are official government coins that the 253 00:15:27,960 --> 00:15:31,640 Speaker 1: US Mint still produces and then sells them to some 254 00:15:31,840 --> 00:15:34,440 Speaker 1: distributor at a markup, and then you sell it at 255 00:15:34,440 --> 00:15:37,440 Speaker 1: a further markup. Is that basically the gist of how 256 00:15:37,480 --> 00:15:39,000 Speaker 1: these coins come into existence? 257 00:15:40,040 --> 00:15:43,000 Speaker 3: Yes, just like any other product. And you're exactly right 258 00:15:43,040 --> 00:15:48,200 Speaker 3: that we had treated a number of new products as 259 00:15:49,080 --> 00:15:55,440 Speaker 3: typical commercial product launches, and so, just like any other product, 260 00:15:55,520 --> 00:15:59,960 Speaker 3: the manufacturer has a markup, the distributor has a markup, 261 00:16:00,640 --> 00:16:05,240 Speaker 3: and then also the retailer has a markup. And that's 262 00:16:05,360 --> 00:16:09,240 Speaker 3: true for all brillion coins that are produced by other 263 00:16:09,360 --> 00:16:12,800 Speaker 3: nations as well. And it is a competitive market in 264 00:16:12,920 --> 00:16:17,240 Speaker 3: the US. You can purchase any number of bullion coins 265 00:16:17,560 --> 00:16:21,640 Speaker 3: produced by other nations, and they market them in similar 266 00:16:21,760 --> 00:16:25,040 Speaker 3: fashion and mark them up in a similar fashion. It's 267 00:16:25,040 --> 00:16:26,440 Speaker 3: a very competitive market. 268 00:16:27,680 --> 00:16:30,720 Speaker 2: So speaking of markups, one thing I've always struggled with 269 00:16:30,800 --> 00:16:32,840 Speaker 2: when it comes to coins is how much of the 270 00:16:32,920 --> 00:16:37,840 Speaker 2: value is derived from the actual precious metal content, whether 271 00:16:37,880 --> 00:16:40,880 Speaker 2: it's gold or silver or platinum versus how much of 272 00:16:40,880 --> 00:16:45,640 Speaker 2: the value is derived from the collectibility and the general 273 00:16:45,720 --> 00:16:48,400 Speaker 2: design or availability of the coin. 274 00:16:49,800 --> 00:16:53,280 Speaker 3: Okay, it's important here to distinguish two different kinds of coins, 275 00:16:53,920 --> 00:16:58,200 Speaker 3: actually three different kinds. One is bullion coins, precious metal 276 00:16:58,200 --> 00:17:01,440 Speaker 3: coins that are sold at a slight premium above the 277 00:17:01,480 --> 00:17:04,919 Speaker 3: spot price of gold when they are sold. Then a 278 00:17:05,000 --> 00:17:09,520 Speaker 3: second type is a collectible coin, like a nuismatic coin. 279 00:17:09,680 --> 00:17:17,320 Speaker 3: A US Mint produces annual sets also precious metal commemorative coins, 280 00:17:17,960 --> 00:17:23,119 Speaker 3: and than circulating coins. So the precious metal coins that 281 00:17:23,280 --> 00:17:29,920 Speaker 3: are boin coins and collectible coins are priced and marketed 282 00:17:30,160 --> 00:17:35,080 Speaker 3: in very different ways. Commmittive coins are produced to much 283 00:17:35,200 --> 00:17:41,560 Speaker 3: finer quality, and the strike is they're almost one offs. 284 00:17:41,640 --> 00:17:45,320 Speaker 3: There are multiple strikes in order to get that fine design. 285 00:17:45,720 --> 00:17:49,760 Speaker 3: Who raise the design and get the polished finish of 286 00:17:49,800 --> 00:17:55,280 Speaker 3: those coins. And because the production process is much more detailed. 287 00:17:55,600 --> 00:18:01,360 Speaker 3: There are fuel coins produce many fewer coins produced. They 288 00:18:01,359 --> 00:18:05,720 Speaker 3: are priced differently, they're marketed differently. They're sold directly by 289 00:18:05,760 --> 00:18:10,639 Speaker 3: the United States meant and those coins, a substantial portion 290 00:18:11,200 --> 00:18:17,760 Speaker 3: of the cost is reflected in those additional costs. And 291 00:18:17,840 --> 00:18:22,040 Speaker 3: so you know, very depending on which metal you're talking about, 292 00:18:22,680 --> 00:18:27,199 Speaker 3: but maybe in percent of the price or so of 293 00:18:27,240 --> 00:18:31,360 Speaker 3: a gold coin or a platinum coin is represented by 294 00:18:31,400 --> 00:18:35,720 Speaker 3: those additional costs. Whereas for a bullion coin, as I 295 00:18:35,800 --> 00:18:39,520 Speaker 3: was saying, those are highly competitive. There are, they're produced 296 00:18:39,560 --> 00:18:44,840 Speaker 3: in very large numbers. They're not produced as collectibles. Sometimes 297 00:18:44,880 --> 00:18:47,800 Speaker 3: they are collected, but they're not produced for. 298 00:18:47,800 --> 00:18:51,280 Speaker 2: That reason, Would an American eagle account as a bullion 299 00:18:51,400 --> 00:18:54,600 Speaker 2: coin or a sort of finite collectible item, because I 300 00:18:54,680 --> 00:18:57,680 Speaker 2: know they issue them by year, Yes. 301 00:18:57,520 --> 00:19:01,680 Speaker 3: They do. There are two version of it produced. The 302 00:19:01,760 --> 00:19:07,480 Speaker 3: bullion coin is produced in very large quantities by law. 303 00:19:07,680 --> 00:19:13,040 Speaker 3: They're supposed to be produced to meet public demand, the 304 00:19:13,160 --> 00:19:18,919 Speaker 3: law states, although sometimes the mint runs into bottlenecks and 305 00:19:19,000 --> 00:19:24,520 Speaker 3: cannot fully meet demand, and they are produced in a 306 00:19:24,920 --> 00:19:31,240 Speaker 3: very rapid mass manufacturing processes. The eagle is also produced 307 00:19:31,280 --> 00:19:35,639 Speaker 3: in a collectible and it's called the proof gold Eagle 308 00:19:36,080 --> 00:19:40,200 Speaker 3: and it is produced according to those very high standards 309 00:19:40,200 --> 00:19:45,040 Speaker 3: I was describing earlier, and is sold at a significant 310 00:19:45,119 --> 00:19:47,920 Speaker 3: break premium above the spot price of gold. 311 00:19:48,160 --> 00:19:50,439 Speaker 1: I'm looking again at the website and the other one 312 00:19:50,480 --> 00:19:53,000 Speaker 1: of the other things you sell is a Pearl Harbor 313 00:19:53,119 --> 00:19:56,840 Speaker 1: gold coin, which is identified as exclusive to the US 314 00:19:57,040 --> 00:20:00,960 Speaker 1: Money Reserve and features Queen Elizabeth the Second on the obverse, 315 00:20:01,320 --> 00:20:04,960 Speaker 1: Navy ships and Japanese fighter planes on the reverse. Can 316 00:20:05,040 --> 00:20:08,359 Speaker 1: you talk a little bit? Is that a US government coin? 317 00:20:08,480 --> 00:20:12,240 Speaker 1: Because there is also private stamping, right, like someone can 318 00:20:12,400 --> 00:20:15,240 Speaker 1: you know someone could get gold and stamp whatever they 319 00:20:15,240 --> 00:20:16,439 Speaker 1: want on it and sell it. 320 00:20:16,560 --> 00:20:19,720 Speaker 3: Yes, can you tell? Yeah, talk a little bit about 321 00:20:19,760 --> 00:20:22,960 Speaker 3: that that's not really coins, Okay, when they're produced that 322 00:20:23,320 --> 00:20:26,119 Speaker 3: they have to be legal tender to be coins. Okay, 323 00:20:26,480 --> 00:20:30,760 Speaker 3: you know you see it football games and coin toss. Well, 324 00:20:30,800 --> 00:20:34,400 Speaker 3: those aren't coins. Those are medals. They're medallions because they're 325 00:20:34,440 --> 00:20:38,040 Speaker 3: not legal tender. It's not a US coin. We usually 326 00:20:38,040 --> 00:20:42,480 Speaker 3: don't put royalty, foreign royalty on our coins, and this 327 00:20:42,640 --> 00:20:46,280 Speaker 3: is like Brien Elizabeth in this case, these are coins 328 00:20:46,400 --> 00:20:49,840 Speaker 3: by other nations that the risk meant does not do this. 329 00:20:50,040 --> 00:20:54,679 Speaker 3: It does not produce bespoke coins according to order, but 330 00:20:54,920 --> 00:21:00,719 Speaker 3: other nations do and it's not unique to US Money Reserve. 331 00:21:01,280 --> 00:21:05,720 Speaker 3: Other companies do this too, but we have been more 332 00:21:05,760 --> 00:21:12,320 Speaker 3: aggressive in developing coins through other governments in limited quantities 333 00:21:12,359 --> 00:21:17,280 Speaker 3: that are collectibles in precious metal and marketing those. Typically 334 00:21:17,400 --> 00:21:24,040 Speaker 3: we are celebrating an anniversary. A percentage of these coins, 335 00:21:24,080 --> 00:21:27,920 Speaker 3: the sole price of these coins typically goes to a 336 00:21:28,040 --> 00:21:32,120 Speaker 3: charitable purpose. We have been very supportive of the US 337 00:21:32,320 --> 00:21:35,840 Speaker 3: Navy memorial, so that's one of the ones that we 338 00:21:36,520 --> 00:21:37,520 Speaker 3: really stood behind. 339 00:21:38,840 --> 00:21:41,639 Speaker 2: One thing I wanted to ask is when you're designing 340 00:21:41,720 --> 00:21:44,440 Speaker 2: a coin, So when you were at the US Mint, 341 00:21:45,000 --> 00:21:48,199 Speaker 2: and I'm not talking about precious metal coins here, but 342 00:21:48,359 --> 00:21:52,520 Speaker 2: just your sort of standard coin, how much does profitability 343 00:21:53,040 --> 00:21:56,560 Speaker 2: come into considerations for designing a coin? Because I know, 344 00:21:57,119 --> 00:22:00,320 Speaker 2: with the Trump administration talking about maybe getting rid of 345 00:22:00,320 --> 00:22:03,600 Speaker 2: the penny, this seems to be even more of an 346 00:22:03,640 --> 00:22:05,560 Speaker 2: issue than it used to be, although people have been 347 00:22:05,600 --> 00:22:08,760 Speaker 2: debating the existence of the penny or whether it should 348 00:22:08,760 --> 00:22:11,920 Speaker 2: exist for decades now. But do you do you sit 349 00:22:11,960 --> 00:22:15,639 Speaker 2: there and you know, write on a napkin. It's going 350 00:22:15,680 --> 00:22:18,359 Speaker 2: to cost me x to produce and I'll be able 351 00:22:18,400 --> 00:22:21,240 Speaker 2: to sell it to the Federal Reserve and the banks 352 00:22:21,359 --> 00:22:22,880 Speaker 2: for why amount. 353 00:22:23,080 --> 00:22:27,080 Speaker 3: Yeah, it's a factor, no doubt about that. And to 354 00:22:27,160 --> 00:22:30,000 Speaker 3: a certain degree, or to a great degree, the US 355 00:22:30,119 --> 00:22:33,399 Speaker 3: Mint doesn't have discretion in the specifications of the coin. 356 00:22:33,640 --> 00:22:38,920 Speaker 3: They are laid out in great detail in the legislation 357 00:22:39,240 --> 00:22:43,119 Speaker 3: that authorized the coin. The long exception to that is 358 00:22:43,240 --> 00:22:47,720 Speaker 3: the platinum bullion coin, in which Congress I'd asked Congress 359 00:22:47,720 --> 00:22:51,080 Speaker 3: for a virtually total discretion on that coin, and they 360 00:22:51,080 --> 00:22:53,720 Speaker 3: gave it to us, and the trillion dollar coin came 361 00:22:54,200 --> 00:22:56,200 Speaker 3: as an unintended consequence of that. 362 00:22:56,320 --> 00:22:58,480 Speaker 2: There's the trillion dollar coin. 363 00:23:00,080 --> 00:23:05,280 Speaker 3: Can't miss it. But yes, all the details are in 364 00:23:05,320 --> 00:23:10,560 Speaker 3: the legislation. But the Mint does attempt to produce those 365 00:23:10,680 --> 00:23:16,160 Speaker 3: coins in the most efficient fashion possible within those constraints. 366 00:23:16,560 --> 00:23:23,120 Speaker 3: And the penny has blown away our capacity to make 367 00:23:23,200 --> 00:23:28,000 Speaker 3: profitable for over thirty years. I was the first Mint 368 00:23:28,040 --> 00:23:32,399 Speaker 3: director thirty years ago to recommend elimination of the penny. 369 00:23:32,520 --> 00:23:36,560 Speaker 3: You can see how much influence I am. But it's 370 00:23:36,760 --> 00:23:40,120 Speaker 3: long overdue to be eliminated. There was a problem back 371 00:23:40,160 --> 00:23:45,400 Speaker 3: in the seventies I believe, where the penny had negative seniorage. 372 00:23:45,560 --> 00:23:47,880 Speaker 3: I can describe what senior riage is here in the moon, 373 00:23:48,080 --> 00:23:52,680 Speaker 3: but it's basically profit and so, and the coin was maing. 374 00:23:52,800 --> 00:23:54,840 Speaker 3: It was all copper. At the time, the coin was 375 00:23:54,840 --> 00:23:58,680 Speaker 3: being melted down because copper, the copper content, was worth 376 00:23:58,720 --> 00:24:04,359 Speaker 3: more than the penny was. And so the wronger stepped 377 00:24:04,400 --> 00:24:08,600 Speaker 3: in and changed the composition of the penny. We had 378 00:24:08,680 --> 00:24:12,000 Speaker 3: a similar situation now with a nickel, where it's a 379 00:24:12,040 --> 00:24:14,960 Speaker 3: money loser. The production of the nickel is a money loser, 380 00:24:15,000 --> 00:24:19,760 Speaker 3: but it might be profitable if there were some changes, 381 00:24:19,880 --> 00:24:22,399 Speaker 3: or at least the amount of money that is lost 382 00:24:22,480 --> 00:24:27,639 Speaker 3: producing each coin would be decreased. Now, one of the 383 00:24:27,680 --> 00:24:30,240 Speaker 3: things that came out of the Sataguria coin in the 384 00:24:30,240 --> 00:24:34,720 Speaker 3: fifty State Quarters program and those two huge projects, very 385 00:24:34,880 --> 00:24:39,720 Speaker 3: entrepreneurial projects, as you were alluding to, Joe, Those were 386 00:24:39,800 --> 00:24:43,360 Speaker 3: launched within about a year of each other, and that 387 00:24:43,480 --> 00:24:46,920 Speaker 3: took the US MINTS profits and our profits. The US 388 00:24:46,960 --> 00:24:50,879 Speaker 3: MINTS profits go to the American taxpayer that go into 389 00:24:50,880 --> 00:24:54,880 Speaker 3: the general fund of the Treasury, and we took profits 390 00:24:54,920 --> 00:24:57,560 Speaker 3: from seven hundred million dollars a year when I came 391 00:24:57,600 --> 00:25:01,040 Speaker 3: into the Mint to two point six billion dollars after 392 00:25:01,119 --> 00:25:06,200 Speaker 3: five years. And I told my staff that they'd all 393 00:25:06,200 --> 00:25:10,360 Speaker 3: be wealthy. We're a private enterprise, but we didn't get 394 00:25:10,400 --> 00:25:12,320 Speaker 3: paid by the by the coin. 395 00:25:12,960 --> 00:25:15,280 Speaker 1: Let's talk a little bit about your the business more 396 00:25:15,359 --> 00:25:19,160 Speaker 1: of selling these collectible coins and bullion coins and so 397 00:25:19,240 --> 00:25:23,800 Speaker 1: forth at gold coins to a retail customer base. I 398 00:25:23,840 --> 00:25:27,440 Speaker 1: have a couple of questions. One is is volume associated 399 00:25:27,560 --> 00:25:30,439 Speaker 1: with price because you must see you know when the 400 00:25:30,480 --> 00:25:32,639 Speaker 1: line is is there when the line is going up 401 00:25:32,680 --> 00:25:35,040 Speaker 1: in terms of the price of announce of gold, do 402 00:25:35,080 --> 00:25:38,840 Speaker 1: you generally see a correlation in pick a pickup in 403 00:25:39,000 --> 00:25:40,800 Speaker 1: people wanting to buy gold coins. 404 00:25:41,480 --> 00:25:46,440 Speaker 3: Absolutely, that's been It's been a tremendous nineteen months since 405 00:25:46,600 --> 00:25:51,440 Speaker 3: this this rally, this bull market began, and over that 406 00:25:51,480 --> 00:25:55,920 Speaker 3: period of time, we've seen prices go up sixteen hundred 407 00:25:55,960 --> 00:25:59,159 Speaker 3: dollars an ounce from eighteen hundred to thirty four hundred 408 00:25:59,680 --> 00:26:05,000 Speaker 3: this warning and it's just it's been one record after 409 00:26:05,040 --> 00:26:09,440 Speaker 3: another being set. So we see a tremendous increase in demand. 410 00:26:09,560 --> 00:26:11,399 Speaker 3: I think most people in the industry do. 411 00:26:11,680 --> 00:26:15,320 Speaker 1: What about the demographics, so obviously you know generally I speak, 412 00:26:15,440 --> 00:26:18,120 Speaker 1: I think of the gold coin buyer who would buy 413 00:26:18,160 --> 00:26:21,919 Speaker 1: from us money reserve is probably someone you know, like 414 00:26:22,080 --> 00:26:26,840 Speaker 1: Tracy's dad's specifically what have you seen demographics do younger generations? 415 00:26:26,920 --> 00:26:31,280 Speaker 1: Does Gen Z or millennials? Do they care yet about 416 00:26:31,520 --> 00:26:34,160 Speaker 1: holding collectible or bullyant coins. 417 00:26:34,400 --> 00:26:36,800 Speaker 3: When I was directed with the MINT, I was in 418 00:26:36,840 --> 00:26:42,240 Speaker 3: my forties and I would describe our buyers as being white, male, 419 00:26:42,280 --> 00:26:44,639 Speaker 3: and over fifty. And there's nothing wrong with that. I 420 00:26:44,680 --> 00:26:50,480 Speaker 3: aspire to be one some day. But worry about that demographic. 421 00:26:50,840 --> 00:26:54,320 Speaker 3: You know, I was fading out over a decade or two. 422 00:26:54,600 --> 00:26:59,320 Speaker 3: That's not the case today. Gold is hugely popular across 423 00:26:59,480 --> 00:27:03,159 Speaker 3: a very wide spectrum. And that's not surprising given the 424 00:27:03,200 --> 00:27:07,480 Speaker 3: amount of coverage news coverage gold has received over the 425 00:27:07,600 --> 00:27:14,159 Speaker 3: last two years and these record prices, especially when the 426 00:27:14,200 --> 00:27:17,920 Speaker 3: stock market is falling, people are looking for safe havens 427 00:27:18,320 --> 00:27:20,800 Speaker 3: and gold is the ultimate save haven. It's been around 428 00:27:20,880 --> 00:27:25,000 Speaker 3: for five thousand years, it's always had value, It's had 429 00:27:25,160 --> 00:27:30,399 Speaker 3: value worldwide. It's the universal safe haven. And what we 430 00:27:30,520 --> 00:27:34,240 Speaker 3: were beginning to see in some of the market research 431 00:27:35,160 --> 00:27:40,919 Speaker 3: is a skewing of interest to younger audiences that includes 432 00:27:41,600 --> 00:27:47,120 Speaker 3: millennials and Gen Z, and some of the research indicates 433 00:27:47,240 --> 00:27:51,800 Speaker 3: that they have greater interest in gold than boomers do. 434 00:27:52,520 --> 00:27:56,320 Speaker 3: That is really a surprise to me, but not too 435 00:27:56,400 --> 00:27:58,760 Speaker 3: much of a surprise once I thought about it, because 436 00:27:59,160 --> 00:28:02,439 Speaker 3: those of us who grew up in the sixties and seventies, 437 00:28:02,720 --> 00:28:08,440 Speaker 3: we're less focused on money and protecting ourselves and than 438 00:28:08,600 --> 00:28:11,960 Speaker 3: what our kids are. And so that you know, that's 439 00:28:12,000 --> 00:28:16,280 Speaker 3: extraordinarily smart and forward looking for them to be thinking 440 00:28:16,320 --> 00:28:20,960 Speaker 3: about their futures and thinking about the role gold with have. 441 00:28:21,760 --> 00:28:25,320 Speaker 3: Now you know, the issue comes up whether you know 442 00:28:25,440 --> 00:28:29,119 Speaker 3: what percentage of a portfolio should be in gold. I 443 00:28:29,280 --> 00:28:32,359 Speaker 3: tell people never put all of your money in gold. 444 00:28:32,400 --> 00:28:36,400 Speaker 3: Don't put in all your money into any asset. There 445 00:28:36,440 --> 00:28:39,840 Speaker 3: needs to be diversification in any portfolio, and the right 446 00:28:39,920 --> 00:28:44,000 Speaker 3: percentage depends on how old you are, your risk averseess, 447 00:28:44,880 --> 00:28:48,640 Speaker 3: you know how large a portfolio is. There's no one 448 00:28:48,680 --> 00:28:53,520 Speaker 3: size fits all recommendation. But one of the factors I 449 00:28:53,640 --> 00:28:58,880 Speaker 3: do recommend people to consider is how optimistic or pessimistic 450 00:28:59,000 --> 00:29:02,080 Speaker 3: you are about the state of the world, the state 451 00:29:02,120 --> 00:29:07,800 Speaker 3: of your own finances, and considering the slave haven history 452 00:29:07,840 --> 00:29:11,720 Speaker 3: of gold. The more pessimist you are, I do recommend 453 00:29:11,880 --> 00:29:15,120 Speaker 3: a higher percentage of your portfolio and gold. 454 00:29:30,600 --> 00:29:34,280 Speaker 2: Why should I buy a gold coin versus invest in 455 00:29:34,360 --> 00:29:35,600 Speaker 2: a gold mining stock. 456 00:29:35,840 --> 00:29:39,280 Speaker 3: Well, mining stocks have tended to underperform the price of 457 00:29:39,320 --> 00:29:42,200 Speaker 3: gold itself. And there's a simple reason for this, and 458 00:29:42,680 --> 00:29:46,720 Speaker 3: that is it's getting harder to find and more expensive 459 00:29:46,760 --> 00:29:50,560 Speaker 3: to mine gold. The clear signal of this is if 460 00:29:50,560 --> 00:29:55,280 Speaker 3: you look back over world gold production over the last 461 00:29:55,320 --> 00:29:59,400 Speaker 3: ten or fifteen years, it hit a peak about ten 462 00:29:59,520 --> 00:30:04,200 Speaker 3: years ago. And despite the fact that gold prices have 463 00:30:04,320 --> 00:30:09,560 Speaker 3: skyrocketed since sin and the miners have tremendous incinners because 464 00:30:09,600 --> 00:30:12,680 Speaker 3: of that, to increase production, they haven't been able to. 465 00:30:13,440 --> 00:30:16,640 Speaker 3: And this is one of the forces that is driving 466 00:30:16,720 --> 00:30:20,920 Speaker 3: gold prices upward today. And one of the reasons why 467 00:30:21,160 --> 00:30:25,000 Speaker 3: I'm confident it will continue to go up is that 468 00:30:25,480 --> 00:30:27,680 Speaker 3: you know, you talk about peak oil. I don't know 469 00:30:27,720 --> 00:30:31,360 Speaker 3: that we've hit peak gold. But the miners have not 470 00:30:31,520 --> 00:30:35,400 Speaker 3: really been able to take advantage of these higher prices 471 00:30:35,440 --> 00:30:41,480 Speaker 3: by increasing production, and so the miners are weighted by 472 00:30:41,560 --> 00:30:47,520 Speaker 3: those additional costs. And also gold is now mined more 473 00:30:47,560 --> 00:30:53,280 Speaker 3: often and politically and economically unstable and corrupt countries, and 474 00:30:53,840 --> 00:30:56,920 Speaker 3: that is adds a risk premvement of cost to doing 475 00:30:57,000 --> 00:30:59,520 Speaker 3: business that the miners have to bear. 476 00:31:00,040 --> 00:31:01,720 Speaker 1: It's so crazy to Tracey, I'm looking at a chart 477 00:31:01,760 --> 00:31:06,360 Speaker 1: of GDX, the Vank Gold Mining ETF charting against GLD, 478 00:31:06,720 --> 00:31:09,920 Speaker 1: the gold ETF. The miners are just a terribly relative 479 00:31:09,920 --> 00:31:11,600 Speaker 1: to gold. It seems like a terrible business. 480 00:31:11,680 --> 00:31:12,600 Speaker 2: Yeah, kind of like how. 481 00:31:12,520 --> 00:31:15,200 Speaker 1: Bitcoin mining companies don't do as well as bitcoin. I 482 00:31:15,240 --> 00:31:17,760 Speaker 1: want to talk about them. You also sell gold bars, 483 00:31:17,960 --> 00:31:20,440 Speaker 1: and so oh right now, I could buy a one 484 00:31:20,560 --> 00:31:23,160 Speaker 1: kilo gold bar on your website for one hundred and 485 00:31:23,200 --> 00:31:26,760 Speaker 1: fifteen thousand, five hundred and forty seven dollars and ninety 486 00:31:26,800 --> 00:31:30,400 Speaker 1: five cents. I could also buy a ten ounce gold 487 00:31:30,400 --> 00:31:33,200 Speaker 1: bar for thirty seven, two hundred and seventeen dollars and 488 00:31:33,240 --> 00:31:35,680 Speaker 1: seventy six cents. Where does that gold come from? What 489 00:31:35,840 --> 00:31:38,280 Speaker 1: is the supply chain for just let's say I don't 490 00:31:38,280 --> 00:31:41,040 Speaker 1: have any collectible interests. I just want a very space 491 00:31:41,160 --> 00:31:44,640 Speaker 1: efficient way to store a lot of gold. Where did 492 00:31:44,640 --> 00:31:47,120 Speaker 1: those bars come from? And how do they get to 493 00:31:47,240 --> 00:31:48,160 Speaker 1: my mailbox? 494 00:31:49,400 --> 00:31:52,280 Speaker 3: Well? I think we source them from several different sources, 495 00:31:52,320 --> 00:31:56,000 Speaker 3: and again that's a highly competitive market. Yeah, and so 496 00:31:56,440 --> 00:31:59,680 Speaker 3: you know, we probably shop like anybody else does. Those 497 00:31:59,760 --> 00:32:04,720 Speaker 3: bars are typically coming from major refiners, some of them 498 00:32:04,760 --> 00:32:08,360 Speaker 3: are in Switzerland, but we are not buying them directly 499 00:32:08,800 --> 00:32:14,120 Speaker 3: from the refiners. We're typically buying them from some wholesale distributor, 500 00:32:14,280 --> 00:32:17,440 Speaker 3: got it. I can't actually tell you who they are 501 00:32:17,520 --> 00:32:19,959 Speaker 3: at this time. Sure, not because it's a secret, but 502 00:32:20,040 --> 00:32:20,840 Speaker 3: because I don't know. 503 00:32:22,440 --> 00:32:26,240 Speaker 2: I imagine one of the downsides to owning physical gold 504 00:32:26,480 --> 00:32:29,480 Speaker 2: is storage, right, and the idea that, all, right, you're 505 00:32:29,480 --> 00:32:32,360 Speaker 2: putting all your money into this physical thing. But the 506 00:32:32,480 --> 00:32:35,960 Speaker 2: risk is someone comes and finds it and steals it 507 00:32:36,000 --> 00:32:38,600 Speaker 2: and you lose it all. How are people dealing with 508 00:32:38,640 --> 00:32:39,960 Speaker 2: that storage risk? 509 00:32:40,680 --> 00:32:44,480 Speaker 3: Well, you can own a lot of gold and hold 510 00:32:44,520 --> 00:32:48,200 Speaker 3: it in a very small place, so I mean, and 511 00:32:48,280 --> 00:32:51,960 Speaker 3: most people will put it into a safe deposit box, 512 00:32:52,480 --> 00:32:55,280 Speaker 3: you know, in their bank, along with you know, the 513 00:32:55,360 --> 00:33:01,000 Speaker 3: jewelry and other things, important documents, and they'll like And 514 00:33:01,040 --> 00:33:04,480 Speaker 3: you can own hundreds of thousands of dollars, if not 515 00:33:04,640 --> 00:33:08,040 Speaker 3: millions of dollars in a very small space. So I 516 00:33:08,080 --> 00:33:12,200 Speaker 3: think the storage issue is a bit of a canard, 517 00:33:12,560 --> 00:33:16,880 Speaker 3: and becoming even more so as gold prices have gone 518 00:33:16,880 --> 00:33:20,160 Speaker 3: from one thousand dollars announced to thirty four hundred dollars 519 00:33:20,200 --> 00:33:20,640 Speaker 3: an ounce. 520 00:33:20,800 --> 00:33:22,920 Speaker 1: You know, it's funny. So I'm looking at the price 521 00:33:22,920 --> 00:33:24,880 Speaker 1: of the gold bars and it's true, like you could 522 00:33:25,040 --> 00:33:28,000 Speaker 1: store right now one hundred and fifteen thousand dollars worth 523 00:33:28,040 --> 00:33:30,680 Speaker 1: of US dollar value, or roughly, that looks like a 524 00:33:30,720 --> 00:33:34,719 Speaker 1: fairly small that one kilo of gold. What's funny, So 525 00:33:34,840 --> 00:33:37,240 Speaker 1: silver is just so much cheaper, because so a ten 526 00:33:37,280 --> 00:33:40,480 Speaker 1: ounce gold bar is thirty seven thousand, one hundred ounce 527 00:33:40,520 --> 00:33:43,120 Speaker 1: silver bar is only three thousand, seven hundred. So you 528 00:33:43,120 --> 00:33:45,560 Speaker 1: get something that's the same weight. No, you get something 529 00:33:45,600 --> 00:33:48,360 Speaker 1: that's ten x the weight for one tenth the price. 530 00:33:48,680 --> 00:33:52,480 Speaker 1: So for gold, the appeal is lots of dollar value 531 00:33:52,840 --> 00:33:55,920 Speaker 1: in a small amount of physical space. For silver, it's 532 00:33:55,920 --> 00:33:59,560 Speaker 1: almost the exact opposite, where you can spend not that 533 00:33:59,600 --> 00:34:02,880 Speaker 1: many dollar and have something that fills up your entire team, 534 00:34:02,920 --> 00:34:05,280 Speaker 1: something to stack, Yeah, something to stack and show off 535 00:34:05,320 --> 00:34:06,320 Speaker 1: on your YouTube channel. 536 00:34:07,080 --> 00:34:10,920 Speaker 3: Yeah, that's right, that's right. When you open that box 537 00:34:11,000 --> 00:34:15,399 Speaker 3: of one hundred thousand dollars with silver, yeah, then don't 538 00:34:15,440 --> 00:34:16,839 Speaker 3: feel like you've really gotten stuff. 539 00:34:18,800 --> 00:34:22,920 Speaker 1: But is there a difference in the type of person 540 00:34:22,960 --> 00:34:27,160 Speaker 1: who accumulates silver coins and bars versus gold coins and bars. 541 00:34:27,920 --> 00:34:32,480 Speaker 3: There's an important difference between those two product lines, gold 542 00:34:32,520 --> 00:34:36,880 Speaker 3: and silver and the market forces that move them. We 543 00:34:36,920 --> 00:34:39,520 Speaker 3: think of them as both being precious metal, both of 544 00:34:39,600 --> 00:34:42,400 Speaker 3: them being used in currency, both of them having this 545 00:34:42,600 --> 00:34:47,759 Speaker 3: long history as a store value. But silver A much 546 00:34:47,880 --> 00:34:53,440 Speaker 3: larger proportion of silver is used in commercial applications and 547 00:34:53,520 --> 00:34:59,120 Speaker 3: industrial applications than gold is. So there's this cyclical component 548 00:34:59,280 --> 00:35:03,960 Speaker 3: to silver that is largely absent in gold, and so 549 00:35:04,200 --> 00:35:10,240 Speaker 3: gold has been considered a pure form of hedging against 550 00:35:10,280 --> 00:35:15,680 Speaker 3: bad times, then silver has been because silver is influenced 551 00:35:15,680 --> 00:35:20,640 Speaker 3: by the cyclical demand factor. When I became Director of 552 00:35:20,640 --> 00:35:23,800 Speaker 3: the MEN, I really was not familiar with precious metals 553 00:35:23,920 --> 00:35:28,680 Speaker 3: or or coinage. I hadn't collected coins. But one of 554 00:35:28,680 --> 00:35:31,960 Speaker 3: my first jobs outside of going to the Mint, was 555 00:35:32,040 --> 00:35:35,880 Speaker 3: going to one of the big annual coin shows. And 556 00:35:36,040 --> 00:35:39,120 Speaker 3: when they announced that the Director of the Mint was present, 557 00:35:39,560 --> 00:35:42,759 Speaker 3: people lined up, like one hundred people lined up to 558 00:35:42,920 --> 00:35:46,279 Speaker 3: get my autograph. I'm just so shocked by that. And 559 00:35:46,840 --> 00:35:49,880 Speaker 3: I like to talk to people, and especially I like 560 00:35:49,960 --> 00:35:52,279 Speaker 3: to talk to my customers. And I was new with 561 00:35:52,400 --> 00:35:55,960 Speaker 3: the MINT and we were going to be very customer focused. 562 00:35:56,040 --> 00:36:01,200 Speaker 3: I was on a mission to demonstrate how government can 563 00:36:01,360 --> 00:36:06,520 Speaker 3: meet the highest standards of business, and the Mint was 564 00:36:06,760 --> 00:36:09,120 Speaker 3: very far from that when I came in. So I 565 00:36:09,160 --> 00:36:11,279 Speaker 3: talked to customers and I spent a lot of time 566 00:36:11,320 --> 00:36:16,719 Speaker 3: with them, and you know, they loved American history. That's 567 00:36:16,800 --> 00:36:19,840 Speaker 3: one thing that's very clear. That loved the art and 568 00:36:19,920 --> 00:36:24,760 Speaker 3: the stories behind coins. And they were good red blood 569 00:36:24,800 --> 00:36:28,120 Speaker 3: of Americans, and they were like the people I grew 570 00:36:28,200 --> 00:36:33,520 Speaker 3: up with in West Texas, and so you know, they 571 00:36:33,560 --> 00:36:35,040 Speaker 3: seemed very level headed to me. 572 00:36:35,920 --> 00:36:37,600 Speaker 2: I would be curious to get your thoughts on this. 573 00:36:37,760 --> 00:36:41,040 Speaker 2: So what was it like actually writing the bill that 574 00:36:41,200 --> 00:36:44,520 Speaker 2: allowed for the possibility of the trillion dollar coin? 575 00:36:45,520 --> 00:36:48,280 Speaker 3: No, it was, it was just it was a nothing. 576 00:36:49,160 --> 00:36:54,080 Speaker 3: We had. The very first entrepreneurial project that I took 577 00:36:54,160 --> 00:37:00,000 Speaker 3: on was I wanted to launch the nation's first platinum 578 00:37:00,040 --> 00:37:03,239 Speaker 3: bullying coin, or a platinum coin of any type, and 579 00:37:03,360 --> 00:37:06,359 Speaker 3: I wanted to demonstrate that we could go after the 580 00:37:06,480 --> 00:37:11,080 Speaker 3: Japanese market. Besides North America, the Japanese market was the hot, 581 00:37:11,400 --> 00:37:15,640 Speaker 3: the big hot market for platinum coins. And are Tarlean's 582 00:37:15,719 --> 00:37:18,719 Speaker 3: north of the border, who I love and continue to love, 583 00:37:18,800 --> 00:37:23,279 Speaker 3: even there is some tension in the relationship. Now they 584 00:37:23,440 --> 00:37:27,080 Speaker 3: own that market and I want won straight that we 585 00:37:27,120 --> 00:37:29,840 Speaker 3: could go and take that market away from them, because 586 00:37:29,880 --> 00:37:32,879 Speaker 3: I've had bigger fish to fry in the fifty state 587 00:37:33,000 --> 00:37:35,520 Speaker 3: quarters and a new dollar coin, and I just knew 588 00:37:35,560 --> 00:37:39,320 Speaker 3: I wanted to demonstrate that, so I wrote a bell 589 00:37:39,680 --> 00:37:43,120 Speaker 3: and I asked for complete discretion so that I could 590 00:37:43,160 --> 00:37:47,880 Speaker 3: go over there and talk to the senior probably in 591 00:37:47,920 --> 00:37:55,000 Speaker 3: his eighty eighties Japanese distributor, and sit down with him 592 00:37:55,040 --> 00:37:58,040 Speaker 3: and say, I'd like to talk to you about designing 593 00:37:58,080 --> 00:38:02,320 Speaker 3: a coin that will be successful Japan. And I knew 594 00:38:02,520 --> 00:38:05,640 Speaker 3: that we would go through the emotions of him expressing 595 00:38:05,680 --> 00:38:08,839 Speaker 3: your opining, but it was just the honor of being 596 00:38:09,800 --> 00:38:14,000 Speaker 3: asked participate in that process that would make the difference. 597 00:38:14,800 --> 00:38:17,839 Speaker 3: And sure enough, when we launch the coin within six 598 00:38:18,000 --> 00:38:19,560 Speaker 3: or eight months, we own that market. 599 00:38:19,840 --> 00:38:23,240 Speaker 1: Philip Deal, you know, I consider you a hero because 600 00:38:23,280 --> 00:38:26,320 Speaker 1: I never really worry about the dead ceiling being briefed 601 00:38:26,320 --> 00:38:29,080 Speaker 1: because I know that ability to mint a trillion dollar 602 00:38:29,160 --> 00:38:32,600 Speaker 1: coin could come up and that will save us in 603 00:38:32,640 --> 00:38:35,240 Speaker 1: the end. Thank you so much for coming on odd LATS. 604 00:38:35,520 --> 00:38:37,120 Speaker 1: Really delight to chat with you. 605 00:38:37,960 --> 00:38:38,919 Speaker 3: It's been a lot of fun. 606 00:38:38,960 --> 00:38:55,319 Speaker 1: Thank you, Tracy. By the way, for those that don't know, 607 00:38:55,360 --> 00:38:57,000 Speaker 1: they could go back. I've written a ton about it, 608 00:38:57,800 --> 00:38:59,960 Speaker 1: the trillion dollar coin. Just look up trillion dollar coin 609 00:39:00,200 --> 00:39:02,600 Speaker 1: debt ceiling. For new listeners who aren't familiar with all 610 00:39:02,640 --> 00:39:04,759 Speaker 1: the lore, just search for it. We don't need to 611 00:39:04,920 --> 00:39:07,439 Speaker 1: repeat it. But I could really like all the sort 612 00:39:07,440 --> 00:39:10,160 Speaker 1: of technical aspects of like what does it make to 613 00:39:10,440 --> 00:39:12,840 Speaker 1: for a coin to be successful? Like I said, I 614 00:39:12,840 --> 00:39:15,319 Speaker 1: could just sort of listen to details on that for 615 00:39:15,320 --> 00:39:17,279 Speaker 1: a long time and all the market research and like, oh, 616 00:39:17,280 --> 00:39:18,959 Speaker 1: we thought it could be big in Japan. We felt 617 00:39:18,960 --> 00:39:21,879 Speaker 1: we could like feat out the Canadian sellers. To my mind, 618 00:39:21,920 --> 00:39:22,960 Speaker 1: really interesting stuff. 619 00:39:23,280 --> 00:39:27,719 Speaker 2: Japanese coin collectors are indirectly responsible for the trillion dollar 620 00:39:27,800 --> 00:39:31,480 Speaker 2: platform coin. Very interesting. You know what I was reminded of. 621 00:39:31,560 --> 00:39:34,000 Speaker 2: I read a book, I guess a few years ago 622 00:39:34,200 --> 00:39:38,320 Speaker 2: about numismatics, and I think it was called When Money Talks, 623 00:39:39,080 --> 00:39:44,200 Speaker 2: And I remember the author described coins as sort of 624 00:39:44,239 --> 00:39:45,920 Speaker 2: physical memes. 625 00:39:45,800 --> 00:39:47,200 Speaker 1: Yeah, like totally. 626 00:39:46,840 --> 00:39:50,719 Speaker 2: Meme plexes, and each coin contains like a set of 627 00:39:50,800 --> 00:39:53,960 Speaker 2: ideas and a set of values that then gets transmitted. 628 00:39:54,320 --> 00:39:57,120 Speaker 2: And I think that really came through in the conversation 629 00:39:57,360 --> 00:40:00,000 Speaker 2: with Philip, like it is not just about the pressure 630 00:40:00,160 --> 00:40:02,960 Speaker 2: metal content, It is also about all these sort of 631 00:40:03,080 --> 00:40:06,080 Speaker 2: social things that are embedded in that coin as well. 632 00:40:06,680 --> 00:40:08,640 Speaker 1: Yeah, and I don't know like what it is, but 633 00:40:08,840 --> 00:40:11,520 Speaker 1: like I really want a Kruegerrand specifically, you know what 634 00:40:11,520 --> 00:40:11,799 Speaker 1: I mean. 635 00:40:11,800 --> 00:40:14,160 Speaker 2: Wait, wait, I have a question for you. Yeah, okay. 636 00:40:14,320 --> 00:40:18,280 Speaker 2: If you were offered a krue Grand versus the same 637 00:40:18,480 --> 00:40:23,000 Speaker 2: amount worth of a tungsten cube, what would you choose? 638 00:40:23,680 --> 00:40:24,160 Speaker 3: Uh? 639 00:40:24,200 --> 00:40:28,000 Speaker 1: Well, I have my well the same uh the same value, 640 00:40:28,080 --> 00:40:31,040 Speaker 1: the same? Oh so I need to I might just 641 00:40:31,080 --> 00:40:31,920 Speaker 1: get a kruwe Grand. 642 00:40:32,000 --> 00:40:32,400 Speaker 3: I don't know. 643 00:40:32,680 --> 00:40:36,399 Speaker 1: I'm really tempted. I have my tungsten cube. I think 644 00:40:36,400 --> 00:40:36,880 Speaker 1: I need to do. 645 00:40:36,960 --> 00:40:39,840 Speaker 2: That's I think the novelty value of a Krugerrand. 646 00:40:39,840 --> 00:40:41,719 Speaker 1: I need a Kruegerrand. I really think I do. 647 00:40:42,120 --> 00:40:43,520 Speaker 2: Okay, shall we leave it there? 648 00:40:43,600 --> 00:40:44,279 Speaker 1: Let's leave it there. 649 00:40:44,360 --> 00:40:46,680 Speaker 2: This has been another episode of the All Thoughts podcast. 650 00:40:46,760 --> 00:40:50,120 Speaker 2: I'm Tracy Alloway. You can follow me at Tracy Alloway. 651 00:40:49,840 --> 00:40:52,600 Speaker 1: And I'm Joe Wisenthal. You can follow me at the Stalwart. 652 00:40:52,760 --> 00:40:55,680 Speaker 1: Follow our guest Philip Deal. He's at Philip and Deal. 653 00:40:55,960 --> 00:40:59,200 Speaker 1: Follow our producers Carman Rodriguez at Kerman armand Dash Ill 654 00:40:59,200 --> 00:41:03,160 Speaker 1: Bennett at Dash, Kilbrooks at Kilbrooks. For more Odd Loots content, 655 00:41:03,239 --> 00:41:05,880 Speaker 1: go to Bloomberg dot com slash odd Lots. We have 656 00:41:06,000 --> 00:41:08,520 Speaker 1: all of our episodes and a daily newsletter, and you 657 00:41:08,520 --> 00:41:10,680 Speaker 1: can chet about these topics. Twenty four to seven in 658 00:41:10,840 --> 00:41:14,040 Speaker 1: our discord discord dot gg, slash. 659 00:41:13,680 --> 00:41:16,440 Speaker 2: Odlines and if you enjoy odd Lots, if you like 660 00:41:16,480 --> 00:41:19,520 Speaker 2: it when we talk about the allure of physical coins, 661 00:41:19,560 --> 00:41:22,160 Speaker 2: then please leave us a positive review on your favorite 662 00:41:22,200 --> 00:41:25,880 Speaker 2: podcast platform. And remember, if you are a Bloomberg subscriber, 663 00:41:25,920 --> 00:41:29,360 Speaker 2: you can listen to all of our episodes absolutely ad free. 664 00:41:29,560 --> 00:41:31,520 Speaker 2: All you need to do is find the Bloomberg channel 665 00:41:31,560 --> 00:41:35,440 Speaker 2: on Apple Podcasts and follow the instructions there. Thanks for listening.