Reply to Thread

Message:: [QUOTE="900fine, post: 338092, member: 6036"]No doubt about that. Whenever I see a wild curve like that, I ask two questions :<ol> <li>What caused the irrational skyrocket in '86-'88 ?</li> <li>What caused the crash in '89 ?</li> </ol>Why the radical upswing in the first place ? Was there a unique, one-time event that swung the market ? I believe so. The advent of certified coins in '86 (PCGS, then NGC) caused investors who had no interest in coins to pour money in. Pure speculation. Back then, those TPGs were new, and most coins had not yet been certified. Plenty of good ones were raw. So that investor money was competing for the certified portion of the market - not all coins as a whole. Big demand, small supply. Artificially small supply, because it's only a portion of all coinage available - the certified portion. The skyrocket was radical, overpriced, and unstable. An unsustainable bubble. It burst. And as soon as it started to drop, the well-known "herd mentality" of the market kicked in. Crash. Go back to the graph. Take a look at the index value in 1984 and 1994 . Draw a line between them, and you see a moderate increase - similar to the moderate increase since then.  A nice, stable, sustainable increase. IMHO, that's what the market would have done if not for a one-time, unique occurence - the inrush of investor money following the advent of PCGS and NGC.[/QUOTE]