Coin value and Recession

Hi Folks,
In my few years as a collector, all I've seen is rising values in coins. What happens in a very bad economy (recession) though? Does the collecable premium of a coin evaporate?

I know bullion value coins will always be worth melt. But I'm concerned about my coins that bring a premium. My heart says keep the coins through thick and thin. My wallet is telling my heart that maybe some should be sold off now, if the premium is going to evaporate. :secret:

And then of course, some are predicting a total collapse. In which case even a premium Silver coin that brings only melt would be worth more then an armored car full of currency.

One dealer, whom I don't know real well yet was saying he's selling coins like there's no tomorrow. He said everyone (that comes to his shop and shows) is exchanging cash for collectable coins. Eek. Sounds risky to me.

 

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Coins are only worth what someone is willing to pay for them, period. With a recession money gets tighter so therefore exposable income kind of dries up. So, investment coins just hang on too or sell off while the market is hot. But, I'd keep them for a bit unless I was 100% sure the market was going to peak.

Where in SW Florida are you from?

 

Unless you are desperate, hang in there, some very valuable collections where made during the depression and up to WWII, Most collectible coin value is in rarity, and these coins will always increase, over the long haul, unless someone comes up with a hord of 1916D dimes, I think they will be good for a long time.
Anyway good luck, and lets hope this mess ends soon.

 

Chicken Little always does.

IMHO - Chicken Little has no cred, because Chicken Little is consistently wrong. Personally, I'm not worried.

 

Doug:
But, the difference in the 1980's was that Wall Street and investors entered the market just to buy and sell for a profit.
That caused the collapse.
Today's market is more fueled by the increase in the number of collectors, espcially as a result of the States quarters program, and the renewed interest that it caused.

Today's collectors are more collecting oriented than investment oriented, but -- still, everyone wants a profit.

 

As a collector first I look at it this way. If prices drop, I can afford more, plain and simple. Time to upgrade or score those out of reach coins at lower levels.

As a vest pocket dealer, prices are rising so fast, I see hoarding is happening...the better stuff is unavailable at guide prices or not at all. It is becomming very difficult to locate and find exceptional high grade material to re-up the inventory. I expect this to continue thru 09, then we will see, I have no clue.

Recession? Yes, but the severity of it all depends on November, and I'm not even going there on this thread.

 

well why not look at it this way

the market goes down = some having to sell their coins or even just spend them
quality and condition of those coins go down as well = your coins are worth more (if kept well)
in the long run, you make good on holding on to your coins

probably flaws in this and I smell some vultures flying around ready to pick me off

 

It's also worth noting that there will always be millionaire and billionaire collectors paying high prices for the really rare stuff. And that the sale of a 1957D cent will never finance a villa in the south of France.

 

It is wonderful to have great knowledge on the value of rare coins. But, in the long run, no one knows anything about the future. Worse comes to worse, the Government guarantees the value of each and every American coin ever made and all are legal tender (except of course the trade dollar). So, when things drop 90% you can crack out the MS68 Morgans and still spend them for a dollar.

PS If you are still thirsty for doom and gloom, go visit a few stock message boards on yahoo finance. I suggest the APPLE board, which is populated by people who have seen their investments plunge 35% in the last few months.

 

I got hit HARD after 9-11 with Honeywell and the airlines, but you only lose on paper or IF you sell cheap. Things have recovered quite nicely, and the same will happen barring a full out collapse of the USA and I don't think that'll happen anytime soon.

I don't know anymore than anybody, and much less than most, but I have no fear of doom or gloom.

 

Time.

The most scarce commodity you will ever have in your life.

 

I'm not a doom and gloomer, but I think the US economy is headed for some very tough times in the not too distant future. I pretty much only buy coins for close to face value; or in the case of precious metal coins, as close to melt value as possible (even below melt in some cases).

 

Why is it that every 4 years this questions comes up?....we are not in a recession.

One reason why I have been doing very little buying for the past few months/year. I do more searching, and reading, and it seems that I'm finding better coins, and coming out on top maybe a little better. I know that at least I'm learning something....

Speedy

 

SteveG,

We're probably in a recession right now. Most of the time, recessions don't show up in the government statistics until they are already over and the statistics are revised. Believe it or not, recessions aren't the catastrophe that the media makes them out to be so don't worry about them -- you'll survive. I would also advise you not to take the doom and gloom articles seriously. They sound scarey and persuasive, but are probably best ignored. That said, it's not a good idea to try to trade in and out of the coin market based on economic forecasts. Do you really care if the value of your coins goes down 30%? First of all, they might not go down. They might go up. Or if they go down now, they might go up even higher in the future. Or they might go up first and down later. Or maybe they'll just hover around current prices for a couple of decades. They look high now, but will current prices have been high if the double a few years from now? Or maybe the series you own will go down while most others go up. Or maybe the reverse. You can drive yourself crazy if you think you can figure this stuff out in advance. Just collect what you like and be secure in the knowledge that inflation is so relentless that over a period of many years your coins will continue to appreciate as long as you didn't pay ridiculously high prices to start with.

 

I try not to worry too much about the value of my coin collection. I collect because I want to collect. It would be nice if it does go up in value but since I am buying my coins with disposable income, price fluctuations don't really bother me. As long as bills are being paid, and money is set aside in retirement/savings accounts, and I am still employed, I will collect my coins.

 

I've been coin collecting for well over 60 years now. I've seen good times and bad times with the economy. So far I just can not remember coin prices dropping down. I've seen them level off, seen coin shows deminish, coin stores start to carry other products or go out of buisness, but so far just can not remember coin prices dropping. Right now we are in a fantastic coin collecting boom and it just has to slow down eventually but the prices of coins will either stabilize or continue to climb. Unless every coin collector suddenly looses thier jobs, goes broke, etc, coin prices seldom are involved. I suspect the reason is that the greatest amount of REAL coin collectors are fairly well off individuals, have secure jobs, saved for a rainy day, etc. Naturally there are many, many, many collectors of normal means and those just do not effect the market for the more collectable coins. If times get bad the amount of people collecting those baby dollars, State Quarters, recent cents and nickes will deminish but coins such as the Mercury Dime, Shield Nickels, or Morgan Dollars will continue thier values.
Possibly if times get bad there will for sure be a drop in the massive amount of books, magazines, booklets, pamphlets on coins that are now overkilling, flooding the market, but coin prices should not be effected. Haven't that I noticed since the 40's.

 

The wealthy will always be wealthy. They will seek out the rare, unique and desirable items that allow them to express their personalities.

Cadillac V 16 Dual Cowl Phaethons were made and sold during the great depression. Manhattan real estate has not suffered the same decline that the average home has in other parts of the country.

Coins, five and six figure legendary rarities, will always have a buyer at high levels, since the supply is smaller than the demand.

Dont attach mental price tags to your coins if you are confident you will be able to hold them over long terms. Just get some old redbooks, and you will see what Carl meant. Relax, enjoy, turn off CNBC and get some good quality time with the grandchildren or go fishing.

Try not to listen to "experts" who try and tell you exactly the opposite of what your inner gut feeling tells you. Some people feed off the capability to preach contrarian thoughts.

Be Happy, Enjoy Life.

 

i collect for the pure enjoyment of it. i don't buy anything on the precept that this specific coin is going to make me money. i buy the coin because i want to own that specific coin for my collection.....steve