Dealer Buys GSA CCs as Common BU CCs Problem?

I was speaking with a coin dealer the other day who bought a bunch of "CC" GSA Morgan Dollars at common money. He bought a couple of 1891 cc Morgans in GSA holders at common BU money. The differential was substantial. He bought at under $500, one already sold well over $2000 and the other is already bidding the same. Is this proper business practice?

 

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I hate to sound like an a**, but yes, this is how dealers make their money. They buy lots of coins at extreme wholesale prices or represent truly rare pieces, which they sell on for a profit. The market will dictate both the buy and sell price for a coin. If a seller is interested in a quick cash sale, the dealer is left with whatever profit he can make from the coin. This example is a bit extreme, but watch an episode of Pawn Stars and I'd say both parties made out in decent shape comparatively.

 

Coin dealers justified to the level of pawn shops, my my.

 

Each individual dealer does business as they see fit, so it is unfair to make such a blanket statement. If I understand the OP correctly, and this dealer supposedly paid less than $500 for all the coins (91CC GSA x 2 plus others) when the one is already at over $2k, it is safe to say that he took the seller for a ride, but this is not something every dealer would do. As with anything in life, there is both good and bad, fair and unfair; the same is true with dealers.

 

Probably his/her reasoning was, "what is coin dealer newsletter on this (these) GSA coins?" I will offer the seller MS60 money. I will sell the coin(s) on ebay. The market will decide. If he checked the auction records he/she would have found what actual market was, not coin dealer newsletter was. With GSAs certain years are worth a lot more than average BU money!

 

I don't run my business that way and recoil at the thought that there might be folks who believe all coin dealers would act that way.

Responsibility is a two-way street. The dealer should treat the client with respect, but the client should do some homework, first.

 

What exactly do you mean by "common BU money"? Also, you said he purchased a "bunch of CC GSAs", so if true, your CDN speculation, even well back of bid would not make sense.

 

Huh, can you read?? Coin dealer newsletter is much different in MS60 compared to MS63 and above, GSA pricing is higher! GSAs in the better dates like 1880, 1879, and other dates are worth significant premiums as any significant dealer knows.

 

We collect coins, not GSA or PCGS slabs. I am therefore not understanding why someone would pay less or more for a GSA slabbed coin than they would for the exact same coin if someone broke it out of the slab.

Regarding an earlier response. Around here most pawn shop stores are also places that buy and sell coins. So yes, around here every pawn shop owner IS a coin dealer too. Also a used car dealer, a used watch dealer, a used video/DVD dealer, etc., etc.

 

If by "we" you mean that you and many others collect coins and not holders, that's fine, but please remember that not everyone collects or feels the same way. It is all personal preference, so there is no right or wrong way for one to enjoy their hobby.

All depends on what you consider a "dealer". Personally, I believe that there is a not so fine line between dealers, simple sellers, and wannabes. Anyone can sell a few coins on ebay, place an ad offering to buy/sell coins, or print business cards, but this is no way makes them a knowledgeable professional, and the same goes for many pawnshops - there is one located not terribly far from me that is owned by a schmuck, and employs a clueless "numismatic expert" who is even more of a schmuck. Sure, they buy and sell coins, but it's a cheeseball operation and such people have no right to be in the same category as gentlemen who have invested great amounts of time and effort into honing their skills and acquiring the knowledge to be able to offer something above and beyond just selling a coin to their customers or clients. Again, this is only my personal opinion, but lumping everyone who sells coins into the same category is unfair to those who take this hobby and business seriously.

 

Agree 200%. Not everybody who sells coins is a dealer or numismatist. It takes ideals and scruples to be either, IMHO, as opposed to being a simple "coin monger."

 

I have a question on what is a fair % for a dealer to pay for a coin ? Lets say I have aBust half that lists for $1000 retail in most guides . For arguments sake it has a green bean so it's at least solid for the grade .

 

i love the way people are outraged by a " dealer" but will brag about the same thing they pull off on ebay by buying or selling!

 

If you have a business license to buy and sell precious metals and a significant portion of your business income is derived from such pursuits and a lot of that is coins, then yes, you are a coin dealer. Such is true of many pawn shop owners. Knowing diddly about ANA or numismatics doesn't disqualify you from being able to hang out a sign and say old coins, gold silver, bought and sold.

 

Thanks Doug , I thought maybe there was some average that the PNG or ANA states is an average for whatever a coin costs . I do understand the variences as I recently paid $1900 for a 1812 Bust halve with original skin and nice cartwheel luster . In other words an exceptional AU-55 coin . That's more than double what I've ever paid for a coin and the dealer wouldn't budge as my poker face wasn't working very well and he clearly knew I loved the coin . lol

 

Depends on the date... some dates like 1882-1884 do trade in that range. Buying 1890's and 1891CC's as generic is unethical... or the dealer is just stupid... but it seems like they are just unethical.