The American Eagle and Demand for Platinum

The American Eagle platinum coin is striking in both design and detail, but recent projections predict that the demand, and thus the value, of the Eagle is emerging from the precious metals industry as a major contender of gold and silver.

Production of the American Platinum Eagle began in 1997. The Eagle is the first and only of its kind to be government-backed in its weight and purity, and it has quickly risen to the forefront of coin investment.

Firstly, just by looking at the American Platinum Eagle coin, buyers can appraise its importance to investors and collectors alike. The front of the coin features the staid face of the Statue of Liberty, with the word “Liberty” written between the spears of her crown.

The rear is no less magnificent with a beautifully detailed eagle soaring above the rising sun. Each year a unique design is created for the rear of the coin. Also, written on the back is the face value of the coin, along with its weight and purity.

Secondly, the American Eagle serves as America’s official platinum bullion coin, and is the first and only official investment-grade platinum coin from the U.S. government.

The American Eagle has the highest face value of any U.S. coin-a remarkable $100 per coin-and its actual value even higher still. This high value is due partly to the uniqueness of the coin’s stature within the U.S. government, and partly because of what it’s made of.

Platinum has often been overlooked by gold and silver investors, but as interest in precious metals has increased dramatically in recent years, investors are looking to expand their coin collections, and some outlooks show that platinum may be at the forefront of future supply and demand.

The reason for this positive outlook on platinum is simple. For starters, platinum is a much more rare metal to come by than gold and silver. It is not considered “readily available,” and in fact South Africa alone is responsible for 80% of the world’s platinum production.

Add that to the fact that currently, an intense labor crises rages on in South Africa, causing miners to delay or cease platinum mining, putting a major strain on the global supply.

In addition, demand for platinum continues to explode. Since platinum has many industrial uses-most notably in the auto industry-maturing economies like China are seeking more and more platinum for their factories. In vehicles, platinum is crucial to manufacture catalytic converters, which serve as anti-pollution devices that are also in high demand because of the green movement.

Gold, on the other hand, is more readily available and thus not as rare, plus modern politics have destabilized the market. For example, the 2013 fiscal cliff temporarily stalled the growth of gold bullion as investors waited to see how government taxing affected the economy. The fluctuation of the value of gold bullion is oftentimes too erratic for many collectors to confidently invest.

Many economists feel that platinum offers a more reliable investment than gold, seeing as the demand will only continue to rise in the coming years.

The peak price of platinum in recent history occurred in 2008. At $2,250 per ounce, platinum soared above the value of gold and silver, and many investors predict it will again out-value gold in the near future.

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