Investing in Austria’s Gold Philharmonic Coins
The late 1980s were a time of great activity among many of the world's leading gold producers to meet demand from those hoping to buy gold bullion coins from nations other than the Apartheid government of South Africa. The South African Krugerrand was, since the 1960s, the world's best selling gold bullion coin, by far. However, political pressure to end the monetary support of that government and subsequent embargoes on South African gold created a vacuum in the market for gold bullion.
Though Austria is hardly a major producer of gold (with only 100kg found in 2000), it has been a major player in the production of gold coins since the 12th century. In fact, the Austrian mint of today is a throughly modern facility located on the same spot in Vienna for well over 8 centuries. The current building was erected in the mid-1830s and still serves as the only official mint in Austria, to this day.
In addition to the Philharmonic bullion gold coins, the Austrian mint produces an array of specialty and commemorative gold coins (often in small strikes) that are more suited to the numismatic market or for collectors with a particular interest in such varied topics as painting, historical European crown jewels or famous composers. Many of these coins are available on the secondary market, as opposed to the Philharmonic bullion coins.
The Austrian Philharmonic coin is somewhat larger and thinner than the gold coins such as the US American Eagle or South African Krugerrand, both designed for long-term gold coin investing. The edge is reeded in a somewhat unusual non-uniform design. On the obverse is the giant pipe organ found in the Musikverein Concert Hall that is home to the famous Vienna Philharmonic Orchestra. On the reverse are several of the instruments found in that orchestra presented with stringed instruments in front, brass and woodwinds in the back.
Just as with other gold coin investments, the Austrian Philharmonic coin is available at very little over the spot price of gold and is struck at 99.99% purity. They are very commonly found at local coin shops or at dealers who specialize in helping customers buy gold bullion. Coins in the true sense of the word, the Philharmonic was actually the first gold coin in Europe to be valued in Euros after several years with a face value denoted in former Austrian currency, Schillings. Also like other gold bullion coins, the face values are far less than the spot price of gold is likely to ever be, unless practical alchemy is perfected.
The Philharmonic coin is sold in several denominations. The one-ounce coin has a face value of €100 (formerly 2,000 schillings). Half ounce €50 (1,000 schillings) coins, €25 (200 schillings) quarter-ounce coins and 1/10th ounce coins stamped at €10 (100 schillings) are also available to those who buy gold coins anywhere in the world. In fact, the Philharmonic series have been the most popular in the world (in terms of absolute sales) for several years. Though the transition to Euros was made in the mid-1990s, many dealers in the US continue to refer to them by their old denominations.
For investors who have had a hard time finding physical gold when the demand to buy gold bullion coins was very strong in late 2008 and early 2009, Austrian Philharmonic coins can present a very strong alternative – one that has become a habit for many people in the US and abroad.
Stewart Lawson
April 18, 2009
