coin converts

Discussion in 'Coin Chat' started by benandshanel, Sep 26, 2009.

  1. benandshanel

    benandshanel hobby of kings

    2 questions:
    In this economy when almost every investment is down, are more people turning into coin collectors?
    Does anyone find it hard to sell people on coin collecting?
     
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  3. BNB Analytics

    BNB Analytics New Member

    I don't think so. However, I have noticed in a report that this year there were a lot of new coin collectors(me becoming one of them) so it could be. You never know.
     
  4. benandshanel

    benandshanel hobby of kings

    i'm interested in helping others collect, preserve and create wealth through coins. I'm just trying to get a pulse on how receptive people are to collecting in this tough economy. I think it's a no-brainer, but am i wrong?
     
  5. kanga

    kanga 65 Year Collector Supporter

    People are often very receptive.
    BUT
    IMO they are people who haven't done their homework.
    They start thinking gold and silver pieces (bullion) but often get them confused with numismatic items.
    IMO the bullion train has left the station and if you weren't on board several years ago, it's too late.
    Numismatic items mostly increase in value but at different rates.
    And the items that increase the most, relatively speaking, are the big ticket items.
    But even they don't have the best investment potential.

    BOTTM LINE: IMO you collect coins, you don't invest in them.
     
  6. benandshanel

    benandshanel hobby of kings

    I'm collecting silver eagles...what are your thoughts on these 15 years from now?
     
  7. kanga

    kanga 65 Year Collector Supporter

    IMO, except for the 1996-W, they will continue to be worth bullion value plus a bit.
     
  8. benandshanel

    benandshanel hobby of kings

    so what you are saying is it's not worth collecting MS 70's?
     
  9. kanga

    kanga 65 Year Collector Supporter

    How many are there?
    Probably a lot more than have already been slabbed.
    Therefore people are paying more based upon the current combined census of all of the respected TPGs.
    Thus as an investment they are probably very risky.
    As more get MS-70 status the value will go down.

    Bear in mind, this is one person's (mine) opinion.
     
  10. BNB Analytics

    BNB Analytics New Member

    Kanga, I have respect for you. Great deals, you know that? Cool :)

    But, I have to disagree with you on the missing the train analogy.

    I think silver is still very undervalued. Maybe not gold, but silver is.

    Just wanted to throw that in ;)
     
  11. Cloudsweeper99

    Cloudsweeper99 Treasure Hunter

    I think the price will be breathtakingly higher. :D
     
  12. kanga

    kanga 65 Year Collector Supporter

    I agree based on the historical silver-to-gold ratio of about 15:1.
    But there are alternative possibilities:
    - gold is overvalued.
    - or the more likely case, gold is overvalued AND silver is undervalued.

    Silver IS growing with respect to gold. That's easy enough to see.
    I certainly don't have the background to make a definitive analysis and conclusion.
    Therefore I personally can't invest in bullion of any type based upon my personal impression.

    But back to the OP's question.
    They were asking about coin collecting as an investment, not bullion.
    Better collectable coins have steadily increased over time, and I would expect that trend to continue.
    But I don't believe the increase even beats inflation, never mind showing a significant profit.
    Anomalies like 1980 can be ignored. I don't see that happening again.

    And one other observation. The hype about new significantly higher prices being realized for numismatic items are for high grade, rarer material.
    That doesn't necessarily trickle down to the coins we can afford.
     
  13. Coinman_Ben

    Coinman_Ben Member

    I have to disagree if you're referring to absolute dollars rather than inflation adjusted dollars. Personally, I don't see one ounce of silver buying the same amount of merchandise that you could get with $50 back in the 1980's anytime soon, but in my opinion, based on history, which proves that when bad money enters circulation, good money goes into hiding, Silver will absolutely go back to $50, it's only a matter of when. It probably won't happen in the next couple of years, but if you measure the gdp of the United States in the 1960's (when silver was at the end of being money) and compared it with today's gdp, you will find that even by government's standards, silver should be $26.73 today. The government's numbers (which entitlement programs, which should really be added to the gdp are left out, which the congressional budget office estimates total to at least 9 trillion, so in my opinion, silver should be at least $34.04 if it is to just barely keep pace with inflation from year to year, so if silver were to all of a sudden, shoot up to $50 again today, it would be another anomaly, unless it was followed by an event that causes the dollar to weaken significantly, such as a formal devaluation, than in that scenario, it would be strange for silver not to go to $50 per ounce, just look at the Weinmar republic in Germany, just as the Great Depression was happening here in the United States, Germany was going through an inflationary depression while we were going through a deflationary depression. I know this was alittle off-topic, but sometimes a crash course in history is necessary to clear up false impressions and opinions that are based on emotion and sales pitches from stock and mutual fund brokers who just want your money (or coin dealer who specializes in rare, expensive coins who don't handle bullion for that matter). If I rocked anyone's boat, that's good because that's how people learn to think rather than react.
     
  14. kanga

    kanga 65 Year Collector Supporter

    I was only referring to the Hunt brothers and their attempt to corner the silver market.
    As I understand it the spike in the value of silver about 1980 was because of their actions, not normal or even unusual economic processes.
    But my background isn't sufficient to debate the topic.
    I'm smart enough (and cautious enough) not to jump on a bandwagon that may not exist.
    Does that mean I'll miss some good opportunities?
    Sure does. (Wow, I certainly missed out in 1964.)
    But I won't get burnt either.
     
  15. Just Carl

    Just Carl Numismatist

    As usual when you ask what time it is, someone will start answering how watches are made. Meanwhile, back to your questions.
    From what I see at coin shows, I go to about 2 to 4 a month around here, the amount of collectors and dealers has grown and a little excessive. For example at one show that is held in a Holiday Inn, they normally used one room for many, many years. Now expanding to two rooms. Where we used to only have 2 coin shows a Month, we now have four standard, continuous coin shows a Month.
    About two weeks ago there was 3 coin shows all on the same weekend in this area. Yes more people are turning to coins and not sure if for a hobby or an investment.
    Where there used to be only a few books on coins, I now see tables full of all sorts of books on coins. There used to be very few manufacturers of coin items such as Albums, folders, flips, etc. and now there are more and more and more of them poping up all the time.
    I suspect the internet has greatly influenced this interest plus the State Quarters and those silly baby sized dollars.
    As to selling anyone on becoming a coin collector, it is rather difficult around me due to all the crime in this area. No one wants to admit they own anything. Mention collecting coins, guns, knives or anything and you get really get some odd looks like just what are you trying to find out.
     
  16. bhp3rd

    bhp3rd Die varieties, Gems

    I think when the economy is bad people turn away from coin collecting.

    I think when the economy is bad people turn away from coin collecting.
    Now I'm talking about everyday folks - they have less $$$ to spend on it.
    The last 2 years at my show the mom and pops, (which simply means regular couples and family's) have dropped by has much as 60%. It' does not mean that they stopped comming, they just stopped comming every month and now come every 3rd or 4th month. The $40 to $60 they used to have disposable income is going for gas, food, medicine, etc.
    For the few with deep pockets heck it don't matter they come and spend what they want anytime.

    I never try and "sell people" on coin collecting, coin collecting sells itself - it don't need me in the middle.
     
  17. GDJMSP

    GDJMSP Numismatist Moderator

    ya know, every I see someone mention that I just shake my head. It's like they think that gold and silver have always had this almost mystical relationship to each other and that 15 to 1 was the magic number.

    Well, from the time that coins were invented gold and silver have had a fluctuating relationship to each other in regard to value. Yeah there was a time when that ratio was 15 to 1. But over the history of the metal the time period that it was 15 to 1 was but a hiccup, a blink and that's it.

    The ratio between gold and silver has always and will always go up and down just like a yo-yo.
     
  18. coleguy

    coleguy Coin Collector

    You need to re-phrase your questions toward investors, not collectors. Collectors aren't phased by economic downturns in the same way investors are. Collectors collect to enjoy the coins, not make money off of them.

    As far as silver eagles, I agree with Kanga. Invest in the metal, not the grade. The metal will always fare better than the grade over time, especially in coins minted profusely and for the specific purpose of being a bullion coin. People will argue against that all day long, but when the time comes to dump them, I notice most change their tunes and even their desire to collect/invest.
    Guy~
     
  19. LostDutchman

    LostDutchman Under Staffed & Overly Motivated Supporter

    I have seen more people interested in both bullion and numismatic coins in this economy lately. The "new" people I see looking into the numismatic market are looking into more investment grade pieces such as graded higher end $20's and graded classic gold. Stuff that is liquid. The average guy collecting wheat cents or something similar has fallen off dramatically. What we are seeing here at the shop is definitely more investment driven at the moment whether it's bullion or numismatic. The average collector is just not buying right now.
     
  20. pappy-o

    pappy-o coinoisseur

    Todays economy has every one sitting on their investments , who knows where it will go. I look at coin collecting as a fun & interesting hobby, just don't go overboard on spending. All fields of collecting are down I don't care what you collect , ebays a good example, a lot less sellers of everything, meaning stay within your means. If you spend money on gold or silver coins a lot better idea than spending on expensive tvs , autos , clothes ect. those things depreciate very fast where your coins don't, as long as you spend within your means. I'am looking at coin collecting as a hobby & not as an investment, if you've got some extra money coin collecting is a lot of fun, again stay within your means :)
     
  21. PennyGuy

    PennyGuy US and CDN Copper

    Coin Collecting versus Investments. Notice I said versus. I don't see a automatic connection. It's a hobby, not many make a inflation corrected profit off a hobby. Every day in the WSJ there are ads on investing in gold and silver coins. Those sellers seem to make a profit, but I doubt the buyers ever will. Might as well make your coin investments from TV.

    If someone wants to make money off coin collecting I would recommend buying certified MS63 and better 1909 S VDB full red cents, 20 years ago.
     
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