Why the coin Bull mkt in the late 80S??

I just looked at a chart of coin prices from 1970 to present. Anyone know why coins exploded in the late 80s? Thanks.

 

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Price of bullion went through the roof.

 

Investors drove prices up. Slabbed coins became somewhat of a commodity which attracted investors which drove prices up whch attracted more investors which drove prices even higher. Then the bubble burst.

 

Is another semi-bubble bursting as we speak?

 

2 words..... Hunt Brothers

 

What's interesting is that it looks like gold got no higher than about $750 an ounce back then and now its 950 . . .

Yes, the Hunt bros. That's probably a part of it.

 

who are the hunt bros.?

 

I don't remember exactly, but I believe they cornered the silver market, bid the price way, way up and then got their butts handed back to them when it crashed. I believe they went bankrupt.

 

I disagree. The Hunt brothers tried to corner the silver market and drove the price of silver to historic highs during the mid to late '70s until the silver and gold markets crashed in 1980. They did not cause the collapse of coin prices almost a decade later.

 

I stand corrected :bow:

 

Yep, they lost all of there fathers money that was left to them! very cool story, to anyone who likes stocks good read!
http://en.wikipedia.org/wiki/Nelson_Bunker_Hunt

 

I was "correcting" (if that is what it is) Ripley, not you.

 

Yes, but I was off by a decade in my thinking so I was actually wrong too

 

In the late 1980's two things happend:
Slabbing became popular and accepted.

So, un-knowledgeable folks (read: investors) could buy coins without knowing what the heck they were doing.

And, then Wall Street became enamored with coins, after reports that over the long term (read: decades) coins had outperformed virtually all investments.

And, then they sold the coins, liquidated them in short order which caused the coin market to crash.

There are still coins that have not recovered to that period's price level.

 

This account makes the most sense, though I wasn't collecting at the time.

I think that's true of almost all coins. It was a really high spike.

 

I doubt it.

I don't know which chart you're looking at, but all the ones I've seen show a much more radical spike in the 80s and a much more gradual buildup in the last ten years.

I challenge you to get a "bargain" price on a truly great coin - right now. Yes, a lot of overgraded clunkers have fallen, but great coins bring strong money right now.

 

Another semi-bubble?

I agree with 900fine.
No, but because:
the old bubble was because of the Wall Street Investment firms who became involved in a business that they had no clue abuot.

Now, the increase in values is because of the increase in collectors that have entered the hobby because of the States quarters program, which increased the number of collectors by (perhaps) a couple of million.

These collectors, most just collecting the States quarters, but many moved on to other things, are not 'in and out' collectors, grabbing a quick buck. many of the coins that were sold have been put away, many will not reappear for years.

This is a very different market, it is collector not investor driven.

 

That's a succinct way of saying it.

For example, almost all the recent mint products are flying off the shelf. Yes, there is flipping and making the quick buck. But there are a whole lot of collectors putting them under their pillows as well.

My only concern is that the older, respected series may fall from favor - Barbers, seated liberty, bust coinage, etc.

We have a lot of new blood. But is it going in a tangent that has nothing to do with our IHC, Shield Nickel, Seated Dime collections??? What will happen to their value?

So in my rambling way, is there a bubble?

I think there are going to be various bubbles bursting - but not an overall coin collectin bubble.

 

Bingo, we have a winner.

 

Sounds to me like exactly the same thing that happened in the early 60's - everyone was putting back proof sets and rolls of b.u. pocket change, thinking that it would be worth a fortune in 10 years. Very, VERY few of these people continued as serious collectors, defined as people willing to buy coins of any value over face for something other than investment. When this didn't pan out, these people just sat on their purchases and didn't buy anything else. Check out the 'value' on rolls of BU 1964 cents and nickles for clarification.