What are the "Hobby Killers"?

Probably should link to an OT Thread that talks about this, but for our purposes:

(1) Coins, even bullion, are a hobby NOT an invesment;

(2) liquid financial assets (stocks, bonds, cash) properly diversified are your best sources of investment and retirement savings.

Happy to talk about this in more detail in a dedicated thread somewhere here at CT, assuming we can do that (I think I created such a thread but am not sure).

 

Log in or Sign up to hide this ad.

Collecting and investing are two entirely different things. And yes, one can certainly do both, but one doesn't have anything to do with the other IMO. Speaking only for myself (though I'm sure at least some people agree), what bothers me with people bringing up the word "investment" when the hobby of coin collecting is discussed is it seems to imply the only reason anybody would want to collect coins is because they'll go up in value someday. That implication always seems to be around even if it's not stated or even intended. Me, I couldn't care less whether my coins go up or down in value, and even if every coin I own becomes worthless it's still a collection of coins I like owning. Not saying everyone discussing "investing" is guilty of this, but it's always a serious eye-rolling moment for me whenever I'm discussing or showing off my collection and the first question out of their mouth is "what are those coins worth?"

Now I'm not going to say that everyone who thinks in terms of what coins will be worth someday is not a true collector, but... I do very much sincerely believe that anyone that only thinks in those terms is definitely not. And not to belabor the obvious, but if you sell a coin, that coin ceases to be in your collection lol.

 

Agree with number 2 guessing that includes 401k's... But number 1 I still thinking how you got to that conclusion

 

Yes I know I am slow catching on but... Dang it.. here what I did I got lucky on the 2019 reverse enhanced what ever it was got for 70.90 shipped.. I could have flipped for investment but I kept it instead. but its sunk in what you all are saying now... my bad..

 

Well, I agree with that but it still doesn't answer my 3 word question. If you're an investment professional, the first 3 words you should be telling your clients for a long term goal is: Get Debt Free! Now I'm your investment professional. I'll send you my bill.

 

Dollar cost averaging

 

You're assuming your client has debt. Sorry, you're fired.

 

I think many collectors, myself included, like to think of the "investment" side of the hobby only when their pieces rise in value (i.e., rarely), but they don't like to think of it when their pieces stagnate or decrease in value (i.e., usually).

I've fallen back on this when I've discovered a few very bad past purchases on my part. Back before I knew better, I bought more than one "problem" coin, in most cases ones that had suffered bad cleanings. When I discovered this years later and realized that I don't actually have that advertised XF 1900 Barber Half in my collection, for instance, I tried to medicate myself by saying that I wasn't in this for the money and it's a coin I wanted despite it's condition, coins aren't an investment, etc., all the while not at all enjoying the experience of having clearly lost money.

This attitude starting ringing hollow pretty quickly and I realized that to not be taken again I had to treat coins as at least somewhat of an investment, i.e., I need to know what I should be paying for such and such a coin in such and such a condition and what such and such a condition meant. If you don't know these things, you will lose unfathomable amounts of money buying undesirable coins.

Why do we keep telling people to "buy the book before the coin?" Why do we continually tell people to learn how to grade so as not to buy under-graded or over-graded coins? Why do we tell people not to buy based on advice from over-hyped YouTube videos? Because we want them to invest their money wisely in this hobby. We know that if they continue to get ripped off they won't continue in this hobby for long. Everyone, I think it's fair to assume, wants to buy what they want for as little as they can pay for it. Conversely, they typically want to realize as much for something as they can when and if they go to sell it. People look for "deals." If that isn't investment style thinking or an example of an investment strategy, then I really don't know what is. And if you aren't using such thinking when buying or selling coins, even ones that you fully enjoy, I would argue that you're not using (i.e., investing) your money, or even engaging in the hobby, responsibly. Collectors do themselves a great service when they at least entertain an investment philosophy while collecting. It actually makes the hobby more enjoyable and potentially less degrading and deflating.

 

I agree with that sentiment essentially but I still wouldn't say such a sentiment has anything to do with investment; it's just being an educated consumer and ensuring your getting your money's worth when making a purchase. I'm certainly not opposed to that, but I'm doing so just to make sure I'm not overpaying for a coin I want; it has nothing to do with what that coin will ever be worth in the future, so it's still not "investing." Any money I spend on a coin I want is never lost. And I'd never buy a coin I don't want regardless of how much I think it may appreciate in value.

I guess our disagreement then is just a matter of semantics, because I do agree with the principles you're advocating for... I just don't consider them as having anything to do with investing. You're using "investing/investment" to mean things I would never use them to mean. What you're describing isn't "investment strategy" it's just being an educated consumer. To me "investing" strictly means attempting to grow your wealth, and thus buying something as an "investment" strictly means buying it with hopes it will appreciate in value, and that appreciation can be realized when it is sold. I don't "invest" in coins with the hopes of selling them at a profit; I buy coins because they're coins I want to own because I find them aesthetically pleasing and/or interesting. That's a pretty clear distinction in my way of thinking and why I don't associate "investing" with "collecting" (and why I get annoyed when people act like the two things are inseparably intertwined). One can certainly do both, but they're still entirely different and separate things.

Well I'm certainly not one of those collectors then! If all my coins became worthless tomorrow, I wouldn't enjoy them any less, because the pleasure I got from owning them never had anything to do with what they're worth. And that's the sentiment behind my insistence that I'm a collector of coins, not an investor in them.

 

If a person is debt free, I'm guessing they don't need an investment professional.

 

Was I close?

 

Only if you're debt free!

 

Basically I am. Retired and loving it!

 

You might all enjoy reading (if that's the right word) this recent blog article I posted:

https://dirtyoldcoins.com/Roman-Coins-Blog

While it's nominally on ancient coins it applies to the whole of coin collecting imo.

Rasiel

 

I’m late to this discussion, but I’d have to say counterfeiting — both coins and the rising threat of fake slabs — is the No. 1 problem. And no one seems to know how to stop it, if it can be stopped at all.

 

Excellent blogpost, Suarez. I read some of your other posts even though I don't collect ancients and found them to be well-reasoned and well-formulated.

I'm don't fully subscribe to your conclusion regarding the negative future of coin collecting. I understand and even agree that there are sociological/financial/demographic/technological forces working against coin collecting's future but I don't think you have given the other side its full due. There are ebbs and flows to the collecting arena whether it be Matisse's or Beanie Babies. I think we are headed to an ebb tide in coin collecting as some of these forces coaelesce. This will result in a coin collecting recession/depression from which will emerge a smaller and more financially sane environment for the bulk of the remaining collecting community. When that recession occurs and for how long is up to anyone's Magic 8-Ball.

I think if someone is associated with this hobby only for money, I think they'll be hurt and possibly very badly. But if you love coins for their history, beauty, art and meaning then whenever the bad things happen, you'll be in a buyer's market.

 

I think they are called "dealers" and I know a few successful ones.

 

If they weren't successful, they probably wouldn't be dealers for long. I'm one that's probably helping to keep them successful!

 

I guess we'll just have to disagree then. Not exactly a first.

I remember them being fairly popular in the late 70's and 80's. I also remember Halperin including them in his NCI grading guide. He was certainly plugged in. Sorry, but I don't believe he would waste space and effort on something few people, (at that time), cared about.

 

If anything this is a point in coin collecting's favor. Coins are largely smaller, more compact, higher value per square footage than many other collectables, thus making them the ideal collectable for urban dwellers forced into ever diminishing apartments and condos. It is possible to fit an entire collection into a safe or safety deposit box. This is not true with many other antiques and collectables which can easily overwhelm a home with their bulk. Just think about collecting classic cars, how does a collector in a dense city like New York City do that without renting additional costly space in a storage facility since they may not have a garage or a space for a vehicle at all.