Canadian Gold Coins

Gold bullion coins, unlike the widely known collector's coins, can be bought and sold in banks and other financial institutions. In Canada, in the early part of 1978 when the spot price of gold was in the $200 range, the mining industry was pressing the government to put the mint to work turning out Canadian Gold Coins for investors around the world. Industry spokespersons were predicting that Canada would be in a great position to cash in on a growing demand being felt by investors around the world.

It turns out that they had a pretty good idea, as precious metal bullion coins have seen increasing popularity as small investments up to the present day. Prior to 1978 the Canadian mint was producing only limited-edition issues for collectors, commemorating the Olympics or the Queen's Silver Jubilee in 1977. The mining industry at that time was pushing for it to be easier for the mint to respond to the much larger bullion coin business.

The trading value of a bullion coin depends on the price of gold on any given day. A commemorative coin is a collector's item with a value that changes gradually, if at all.

Bullion coins must be produced in great volume with a low profit margin, three per cent is the widely accepted standard unlike commemorative coins which are produced in small numbers with a large mark-up for the mint.

Mining officials prefer coins to other forms of gold because government minted coins can be sent out of the country duty-free. Other Canadian gold exports were subject to a 17.5 per cent duty.

Mining officials urged officials to get into the market as soon as possible. Market conditions were ideal at that time. The large U.S. banks and financial institutions were searching desperately for gold to offer investors.

Arguing in favor of the mint being able to produce more silver and gold coins, industry spokespersons said that bullion coin production would .allow Canada to cut its foreign exchange deficit and create jobs by the thousands both in the mint and in the mining industry. "Bullion coins from the mint would have overwhelming and immediate acceptance." The result has been the highly successful and prized pure-gold Maple Leaf Gold Coin.