The E-Sylum:  Volume 8, Number 19, May 8, 2005, Article 21

MORE ON THE KRUGERRAND BAN

Regarding Myron Xenos' note on Krugerrands, Tom
DeLorey writes: "Beginning in 1985 it became illegal to
import Krugerrands of any date, though any coin already
in the United States remained completely unrestricted. You
could buy them, sell them or ship them out of the country.
You simply could not import them.

I have never heard that the South African government
struck any back-dated Krugerrands.

The Krugerrand had been created in 1967 as a vehicle to
promote the sale of gold to individuals. By making them
exactly one troy ounce net weight, they became much more
popular than the odd weight Mexican 50 Pesos (1.2057 tr.
oz.) restrikes and the Austrian/Hungarian 100 Corona/Korona
(0.9802 tr. oz.) restrikes that had dominated for decades.
Simply put, they eliminated the need to do math. Take 7 or 13
each of the three coins mentioned, and how much gold do you
have? With Krugerrands, you knew.

By 1985 gold investing by private individuals was well
established. Rather than fight the U.S., South Africa simply
sold its production in bar form to Australia, which sold it along
with its own production in coin form as Nuggets, Kangaroos
and Chinese Lunar coins. I would not be surprised it a lot of
it also ended up in the Austrian Philharmonics, the Isle of Man
Cats, the Gibraltar Dogs and Angels, etc., etc.

I have seen it said that since the South Africans were now spared
the heavy promotion costs it had put into selling the Krugerrands as
a way of promoting its mining industry, the net loss to the S.A.
government was less than US$1 per ounce. Gold is gold. They can
sell it anywhere."

  Wayne Homren, Editor

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