Went to an auction ...

I went to an auction last Sunday because they had a pretty nice collection of copper, silver, and gold coins. The auction house sells a lot of different stuff and I've had good luck in the past getting coins of good quality and pretty good prices. It was totally different last Sunday. First, the place was virtually packed with people. Second, the coin people at the auction were much more than normal. I could see at least 15 different people bidding on the coins. In the past, it would be only 1 or 2. The auction house does a great job of displaying the coins on their webpage and I priced them all out prior to the auction by comparing prices on ebay. I showed up 30 minutes prior to the auction to confirm my thoughts on the condition of the coins. They had over 100 different coin auctions and I won exactly none. The prices were going for 25%-50% more than ebay, which didn't count the 10% buyer's premium or the 8% sales tax. I couldn't believe that people were paying $45 for common date Morgan and Peace dollars in less than AU condition. What does this say about coin prices? Are they really worth more than ebay. I'm thinking that the people buying these coins don't like on-line buying or for that matter going to a coin show. Either one would have saved them money.

 

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Sounds like a bunch of rich hoarders are buying up all the good coins and making sure there are no good deals for anyone else. Apparently there's a lot of that going around lately.

http://www.cointalk.com/t197848/

 

I agree with hobo it's either rich hoarders or people who are new to coin collecting

 

There is a whole different dynamic at auctions, especially when a lot of non-collectors are there. THe thread Hobo generously posted has a lot of opinions concerning the phenomenon.

Personally I find those auctions usually go too high for junk, about average for more collectible coins, and low for the rarities. I got my 1795 FH dollar at one, at about a 30% discount to greysheet at the time, (probably about 80% discount to grey sheet now).

 

I've been to one and had the same problem. But I did get a 1969 bahamas $5 piece (1.253 oz silver) For $20 when silver was at $40/oz. Still have it and think it was a great deal.

 

Hey Caz, I love your avatar. Where did you get the idea for that one??

 

Got a little insight on this about a year ago during an auction. I went out to smoke (nothing I was interested at this point). Couple of the other guys also came out. One was talking about why he paid so much for a bag of junk silver dimes (quite a few dollars over melt). He was speculating that in November and December (month or two down the road) industrial demand would increase for silver, thus driving up the spot price and enabling him to sell at a profit. If I remember correctly I don't think it went up enough. Another auction around the same time, I watched two guys bidding on 5 gram silver bars, paying $12.50 apiece for them (melt, at the time, was less than $5). Same guys got into a bidding war over a 100 mg plated gold bar (clearly marked, total weight was an ounce), with the winner bidding $600. I didn't even want to know what these guys were thinking.

 

I usually do quite well at these auctions for the reason mentioned above. Non coin people will bid up the wrong things. They had a few very nice coins at the auction but the prices went extremely high. I really wanted the 1871 dollar but I stopped bidding at $640. The 1908-S cents were going for $90 each at G-4. I was baffled by the bidding.

 

That's what an auction is all about. If you have the money, good. If not, then you're stuck. That's the name of the game.

 

Hobo, I am a fan of the Walking Dead but don't get AMC so I have to wait until I can 'acquire' it off the internet... Life is incomplete without it.

 

Ha lol^

 

Indeed. Drooling "auction hounds" mesmerized by shiny eye-candy... meanwhile, dull rarities don't get a second glance. LOL.

Just have to know how to play the bidding so some bidzombie doesn't realize what you're doing.

 

I hope you're not implying you torrent the copyright videos illegally, right?

 

I have experienced similar bidding at local auctions. People paying $35 to $45 for common date and circulated peace and morgans. ASE's never go under $40 and sometimes hit $50. At the ones I attend it seems they bid up the common coins to what I think are ridiculous prices but this means I find one or two steals per auction.

For example, I was able to get a philharmonic silver round for melt because no one knew what it was. At another auction I grabbed a barber half for melt and two half dimes. Not great deals but not bad in my book. I now go to see what I can get that no one else knows. Unfortunately the auctioneer knows the value and usually starts the bidding right at melt. Next time something comes up that others don't know I may offer at just under melt and see what they do.

 

It's not so amazing that there are so many stupid people, but that so many of those people have so much money.

 

We're still newbies at coin collecting, but learned quickly after being conned a time or two at local auctions. Not only are they overpriced, but you rarely get close enough to see that the coin has a hole that has been refilled, that it's been cleaned yet has a ridiculous MS69 rating, etc. Or even worse, someone's buddy is in the crowd running the prices up!

As far as why there are so many more buyers, it's probably because no-one is paying their mortgages & CC's anymore and now everyone has extra $ to "invest"! I just wish I was one of them!

 

No, hoping to get them off the site, if and when they go up for sale.

 

The Auction Mentality

I have been attending auctions most my life and here a few reasons why people will pay more.

First of all, a lot of old-timers with tons of cash and who have never even turned on a computor will buy things for the sake of buying it. People with no idea of what a coin is worth will go with the flow assuming that if a dealer can buy it at x-amount then if I pay a little over that I am still getting a deal. These people usually have deep pockets and are out for a day of fun.

Secondly, at a bricks and mortar auction, you can see the item, inspect it and know at the end of the day it will be going home with you. I personally, will pay a premium to do this. I can also look across the room and see who I am bidding against. I can't do none of these things bidding online.

It takes a lot of will power to show up at an auction with lot's of cash and not buy something, regardless of price.

Bricks and morter auctions are still the best format for a seller provided the selling commision is 25% or less.

 

Amateurs would be the ones who do it or dealers who know nothing about coins and think they can make a few bucks
in an antique shop somewhere.