Will the new economy effect the future value of numismatics?

I can't comment on those things because I don't buy them or ever even think of them. I can see a valid comparison, basically junk to junk. But while few people 100 years from now are going to be hitting up the auctions for Beanie Babies, something like 19th century British pennies will always have value to people, because it is a tangible piece of history and many people appreciate that.

To address your example of the first day issues and slabbed ASEs, those are similar to when baseball card collecting turned into buying cases of cards hoping to find the insert with a piece of a Babe Ruth bat in it. People started to realize they were just being exploited and they stopped buying them, but they were still interested in the old hall of famers (Hank Aaron, Mickey Mantle). People might not want colored coins from Tuvalu in 50 years, but the classic coins will still have value. I can't say if it will be more or less than now, but things like coins have a lasting value that will always be there to some extent.

 

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Hmm, I don't have those records, it was many years ago - maybe 2005ish or earlier. $925 for the Delawares and I think $500 for the Pennsylvanias.

 

Thanks!

 

If you're thanking me, guess you were smart enough not to buy at those prices.

Just checked eBay, the Delawares are currently selling for $100 to $200 (still too much).

 

I wonder what percentage of coins sold in the LCS are collectibles, still inflated to 2007 values. I'd guess many hoarders just tune out, don't know 'what it's worth' now - and don't want to. Until the collection gets sold, it doesn't matter anyway. And that's the Zero Hour... a tsunami of Sellers, maybe?

Norfed collectors might be indicative or a weird niche, dunno. The rarest of Norfeds, the Gold KING Kalakaua 2007 Dala Hawaii Dala 1 Ounce .999 SILVER Liberty Dollar HI, sold on feeBay for a whopping $200. on 11/6/2012 (barely two months ago) ... now available for .... $ 11. ?
http://www.ebay.com/itm/Gold-KING-Kalakaua-2007-Dala-Hawaii-Dala-1-Ounce-999-SILVER-Liberty-Dollar-HI-/221176236840

Get your bids in now folks, lol. Sure is purty, tho. Why not throw more good money after bad?

 

Just look at indian head cents. The only listings, besides 5 BU grades, is the 1877 like 6 times. Do you REALLY believe this has any correlation to what 99% of the collectors collect? Yes, it has a 1922 silver dollar in 63, ONE, and has FOUR 1794 dollars. I wonder which coins are affecting this "index" more?

I simply find this index effectively meaningless in relation to 99% of coin collectors, and was put together simply to try to pursuade wall street to invest money in "investment grade" coins.

 

Wow. Now I know why you call yourself statequarterguy. :smile TC

 

Modern day comic book investors make all of their money in the short term. The death of Captain America comic I bought in April 2007 was sold a few months later for $25. Now I can buy it back for $1. A lot of comics are like this. They're popular for a few months, so they're pretty expensive, but if you wait long enough you can probably find them in the dollar bin. Very few, like Spider-Man #36 or Walking Dead #1, remain expensive.

I'm new to this, but I wonder if modern coins are the same way. Are the state quarter collectors similar to comic collectors in the late 1980s-early 1990s who bought tons of books because they were going to put their kids through college?

 

It depends and obviously it depends what market you are talking about.

From what I see, the gap between the rich and poor is widening and this has some kind of impact of coins.

Key date or rare coins has always been or will always be expensive. What makes this worse is you have financial firms who reckon they can use numismatics for investment purposes which means certain coin prices will remain high.

Average coins will remain affordable and price wise if you favor in inflation, they could possibly lose value.

 

And as values fall, collectors who were priced out of the market earlier return, or new collectors enticed by lower prices start until a new equilibrium is reached.

A lot of the boomers are still fairly young. I'm a boomer and only 52. I'm still 15 years from retirement and about 25 years from needing to seriously consider disbursal. Heck the OLDEST boomers are only 66 years old.

They are. There have been a lot of modern coins and sets that people bought when they first came out and flipped for high prices which now sell for a fraction of the old prices. 1995 proof sets went crazy and rose from $12.50 to around $150 a set. Today they are $8. The 1999 silver proof set originally sold for $32. It ran up to the $400 range, and has since slid back down to around $100 and I don't think it has hit bottom yet.

 

Doug, give me a break. I love how you have conveniently cropped each of the graphs to the time frame and y-axis scale necessary to prove your point. I have a graduate degree in statistics, and more than 50 peer reviewed publications. What you're doing in the scientific world is called "lying with data". Your points/observations of "testing" lows may be valid, but your visual aids are meaningless and biased in their selection to support only YOUR hypothesis.

 

So, you're trying to say that Norfeds -- and, unless Norfed collectors are "a weird niche", coins in general -- are so very toxic that people are already selling them for ~1/3 of their intrinsic silver value?

The auction that you cited was at $11 yesterday morning, an hour after it started. By the end of yesterday afternoon, it was already at $70, and the lead offer was from a bid that had been placed less than an hour after the auction's start -- and the auction has over 9 days left. I wouldn't be a bit surprised if it closes below $200, or if it gets pulled -- it is, after all, a Norfed -- but it's not "available for $11", period.

You can't use prices from in-progress auctions to bolster your arguments. That's a bit like saying "Gas at my local station was $3.42[SUP]9[/SUP], but the guy on the ladder just took down the 4 and the 2 -- gas has dropped to 3.9 cents per gallon!"

 

There are no "lies" there as long as the axes are clearly labeled, but they certainly are "misleading". They suggest great falls from previous peaks, but here's the reality:

Generic gold coins (graph 1) -- peaks around $35K in Jan 2010 and Aug 2011, troughs around $28K in June 2011 and $27K in May 2012, current value around $29; an overall pullback of ~20% from the highest peak.

Twentieth century coins (graph 2) -- start a bit below $50K, peak at $54K, end around $43.5K; an 8% climb, followed by a ~20% drop.

Proof type coins (graph 3) -- peak at $37.4K, low at $36.1K, a maximum drop of 3.5%.

Morgan and Peace dollars (graph 4) -- peak at $135.8K, low a bit above $133.5K. That stunning plummet from left to right reflects a bank-breaking loss of... 1.7%.

And, finally, the ten-year PCGS 3000 index graph -- start at $56K, peak at $73K, pulling back to a current value around $67K; a climb of 30%, followed by a drop of 8.2%.

Those are significant fluctuations, but not the 80% swings that these improperly normalized graphs suggest at first glance.

Compare this to, say, the DJIA. Starting around 8600 in Jan 2003, it peaked at 14164, a 65% maximum gain -- then dropped to 6547, a 54% drop from its peak, or a 24% drop from its 2003 starting value. Today, it's about 5% below that peak, up about 50% from 2003 levels. Clearly, the DJIA has outperformed the PCGS index over that specific interval as a whole -- but the DJIA has been considerably more volatile.

 

It's hard not to notice the people here who think economic downturns will adversely effect the coin market are also the ones who seem to think the majority of collectors are not collectors but investors in coins. Thats where they're wrong. The majority of collectors are simply collectors and could really care less if their coins have gained or lost value. So putting coins in the same category as poorly performing markets is asinine, at best.
Guy

 

Huh. I'm not seeing that at all. The most compelling arguments that I've seen in this thread:

Boomers are starting to die off, and their collections will mostly fall into the hands of non-collectors, who will (best case) sell to coin shops at a hefty discount or (worst case) feed the CoinStar. In either case, the supply of coins goes up, with no clear path for demand to increase.

Others, facing unemployment and medical expenses and such, will be forced to cash in "investments" and sell off "belongings" to meet expenses. In either category, coins are an obvious target -- again, the supply goes up, without a matching increase in demand.

Against this, we see the rising price of precious metals, which has lifted the boats of junk silver and generic gold. There are plenty enough threads already discussing the future of this trend.

In addition, we see the perceived "timeless nature" of numismatics -- people have been collecting for ages, and there's no clear reason to think they'll stop soon.

 

But those are all scenarios that have panned out for centuries and yet we haven't seen drastic declines in the market in the past. Collectors have been preaching about the hobby crashing into oblivion for as long as I've been collecting (over 30 years), and I've come to the conclusion it's just another aspect of the collector mentality.
Guy

 

I wasn't trying to start a fight. My only major problem with the PCGS 3000 is its SO BLOODY weighted to very expensive coins.

Even worst, its coin dollar weighted not volume related. It has 4 data points for a 1794 dollar, how many XF 1832 CBH's ar eon there? How many 1794 dollars do you believe change hands each year in each of those 4 grades versus something like an 1832 CBH? So, if the PCGS 3000 goes down, what bearing at all will that have on nice XF CBH's, you know, traditional collector coins. Same with everything else. THe 1877 IHC has like 5 data points, but the 1878 has zero. I sure as heck see a lot more 1878's changing hand at every show.

That is all I am trying to say. I haven't studied the census of the other PCGS groups, but I fear the weighting being based on dollar value versus volume still will make such a graph misleading.

 

New collectors entering the market could off-set any impact that the over-all economy could have. The coin market is small and can be impacted by things other than the over-all economy. For example in a bad economy metal prices can go up which may help the coin market. That being said if someone could provide evidence of a correlation I would be willing to consider it.

 

jeffb-
You misunderstood me. I'm well aware the auction I posted isn't over. (Of all NorFeds, I think it the most beautiful - consider it the Rolls-Royce, so to speak. It SHOULD sell at the highest premium.) And I won't be upset if someone here snags it for $120, either.

Fact is, the last time this type coin (gold-plated 2007 Hawaii Dala King Kalakaua 1oz Norfed) sold, it was $405. and $455. Now, common Norfeds NOW are selling (IF they can) for 2x Spot, waaaaaay down from 2008 and even November 2012. The premium has plummeted.

We shall see what this 'Rolls-Royce' sells for next week AND how many bids is gets. (Then await the next bell.) Under $200? Cancelled auction? If your Herbalife stock lost 50% of its value in two months - or couldn't be 'sold' publicly! - how would you respond? Shrug, "I'm just a stock collector, after all." No - collector values are the topic and that particular dodge is not permitted.