Hal1950 is having problems logging in to post his observations of the Denver Mint's Coin Shop first day sales of the special two coin Kennedy Half Dollar Set. Here is his observations. "July 24th, 2014 Sales of the new Kennedy Half Dollar (K14) set began at roughly 10AM Rocky Mountain time at the Denver Mint. The day before, a large out of town dealer, passed out fliers offering to buy the sets for $5 more than the $9.95 issue price. Thought to have a limit of 5 per person, this amounted to a $25 profit for every person that would wait in line & purchase 5 sets from the Mint. The results were that 100-150 street people showed up hoping to cash in on the easy money. Certainly an interesting assortment of people to be sure. Now this is where it becomes interesting… Around 9AM, word began to spread that the Mint was going to limit the sales to Two sets per person. There was noticeable discontent that spread thru the crowd as the word spread. Then another out of town dealer showed up and seemed to save the day by offering everyone $25 per set. The excitement was back, now everyone in line was going to make $30 profit! More is always better and more people began to show up as word seemed to spread by magic throughout the streets of the city. About 9:30 the dealer that had originally handed out the flyers arrived & the belly bumping followed by a bidding war began. Soon the price was $50 per set, an $80 profit for every person that would stand in line. Ah, the joys of capitalism, I even think JFK himself was smiling down. After all, it was definitely a chunk of money going to some people who could really use it. Apparently the original dealer that passed out the fliers decided that he wasn’t going to compete with the $50 price tag and departed leaving his competitor, a man with a large red sack, the spoils of the “Great Denver Mint Price War”. Armed with $30,000 in $100 bills he soon began filling his “Red Bag” with the highly desired Kennedy Sets. Kind of like a “Reverse Santa” in a way. Then a slight glitch… The Mint ran out of change for the crisp new $100 bills, It seems that $20 bills were rarer than the coins! A mad rush was made to the 16th Street Banking district to exchange the useless Franklins for the now highly sought after Andrew Jackson’s. It took almost a half hour, but the exchanges were made & now the sales could continue! Person after person proceeded thru the line and after about 2 1/2 hours, The great Red Sack was bulging at the seams, and all the Franklins & Jacksons were depleted. Roughly 600 sets were sold in this time and it was actually very efficient and peaceful throughout. The Mint personnel were courteous and helpful, all in all a pleasant experience. Interestingly enough though, when the “Buyer” was whisked away from the scene, The Mint closed it’s doors and a group of about 15 police & security guards disbursed the crowd announcing that the Mint was closed for the day & sales would resume Monday at 8AM, yes the Denver Mint is closed to the public on Friday thru Sunday, who knew! Hal Greimann"
Just when you think you’ve seen it all, greed forces an idiot, chasing potential profit, to new heights of stupidity. This dealer stands to lose big time, as these are available on eBay for $29.95, which is still too much. As soon as a number of these hit the market, they’re going back to $10/set.
My guess is he thinks first strike or early release will go for a lot. I think he overpaid. Once the other dealer left town, he should have lowered his offer... haha.
$50.00 a set, $50 grading fees. Who is going to pay over a hundred dollars for $1.00 in clad half dollars
Yeah, dealers usually know better or they wouldn't stay in business. This was probably some idiot, with his last $30k in retirement savings, trying to make a killing. He probably didn't even realize this is not a limited mintage issue.
NGC offered a first day of issue label for those sets sold at US Mint locations if they arrived at NGC by today. Theoretically they were also available to people buying on the website, but only if the mint's shipping box had a shipping date of 7/24. Has the mint ever shipped out a product the same day it was ordered? Especially when they didn't start taking orders until noon? Anyway, maybe the guy isn't an idiot and he is going to have a near monopoly on the special NGC label.
Hal1950 dropped us another email: "Sure wish I could reply to some of the comments from the CoinTalk post... The dealer that was buying was neither "New" or "stupid"... I've known him for over 30 years & he is one of the largest coin dealers in the country. Also, it is not $50 for one coin... & $25 for certification, It is $50 for TWO Coins & $50-$75 for each coin for "First Strike" "First Day" certification. That comes to $75 to $100 per coin! Depending on the grade received for these coins, they could bring a bit more than the net "Cost", or possibly much more. Guess if your not familiar with what the "Opening Day" baseball coins bring in comparison to the regular label issues, it would seem hard to understand. At any rate, getting ready to head to Chicago, next week should be really interesting. Hal in Denver" I guess when Hal tries to log onto CoinTalk, he is told that his email address is no good but it is the same email address he has had for over 10 years. PS: If the dealer is going for an "Opening Day" of "First Day " label, he may be the one laughing all the way to the bank........
I thought so too .... But after Hal mentioned the "First Pitch" and checking the price guide, the gold Kennedy will still have the option of "First Day" label but the P&D Clad sold at the ANA will not. The label means really nothing to me, but to some it means a lot.
And then............the Tax Deductions begin. It's really a win/win since if the dealer cannot make his money back, he simply declares the loss on his income taxes. "Greed" is something for only those who can afford it. Everybody else simply poo-poo's it. BTW, before getting my "In Stock and Reserved" notification online, I sent my Daughter In Law down to the Mint to pick me up the last 3 sets they had in inventory. Unfortunately, she's sending them via some fellow with a 10 speed bicycle.
True, but, the dealer would only recover the loss times the dealer's marginal tax rate. Could be zero or as high as around 50% of the loss. As a general rule, one is always better off making a profit rather than a loss.
This is a dumb way to do business. Writing off losses like this saves you so little.. You are still taking a loss, just a slightly smaller loss.
As with anything, when dealing with modern mint products, there is a certain risk involved. Will you get your product in time to optimize your grading expenditures? Once you receive grades, will they be high enough to cover your costs? Will you be able to get your coins to market before the other guy? All these factor into your potential profit which, in some cases, can be HUGE and in other cases, not so much. I once discovered the DDR for the 2009-S Lincon Formative Years proof coin and while my coin was out making the snail mail rounds between attributers for their records, another fellow came along and sold his for $2,500! My attempts at selling did not fare nearly as well. It was all about getting to Market 1st. Of course, nowadays folks are pushing the envelope even further by "pre-selling" MS68 and MS69 First Strike or ANA Coins in the hopes that they score these grades. Getting to Market 1st can mean profits or losses. The shear volume of coins acquired and submitted can sometimes alleviate the losses or bolster the profits. As the last straw, losses can be deductible.
I was simply trying to say it wasn't a win win. No matter how you look at it, taking a loss is not a win.
