Do Krause world coin values match other guides?

Log in or Sign up to hide this ad.

Of the three mentioned, Coin Archives is far and away the most useful. Too many of the results at Heritage reflect buy-backs of coins that did not reach reserve, hence the numbers are not reliable in some instances. ACSearch is great for what it is, and the price (free) is very attractive.

But for anyone who is seriously involved in buying and selling rare world coins, there is no substitute for the professional version (subscription required) of Coin Archives. All of the records are based on auction prices realized, hence the same caveat mentioned about Heritage applies to all of the auction houses displayed on Coin Archives. However, given that so many more listings (including all of the auction houses in Europe) are displayed, you will be able to make some pretty accurate assessments on the value of a piece.

As for Krause, the real value in it has never been the price listings, but rather the mintage listings and footnotes on some coins. This is especially true on extremely rare coins where auction archival records yield nothing. A look at the mintage in Krause and a comparison of what Krause thinks the common date is worth versus actual real world prices in Coin Archives for the common date, will enable you to make some deductions about what the more rare piece is actually worth based on mintage figures.

 

I had to read what you wrote a few times because it's hard to wrap your head around. This bandwagon effect sounds remotely familiar. So it sounds like you're saying interest and prices are largely independent of each other. Or perhaps this is more accurate: pricing determines interest, not the other way around. But it is counterintuitive to me, since I'd think that low interest drives prices - for example, if people lost favor with a certain coin I couldn't imagine the price increasing. Their lack of interest would dictate the coin's pricing into the future. I believe this is basic supply and demand theory. You mentioned interest is highest when prices drop, and that would be true, at first. But once prices have dropped, I think your theory as I understand it is weakest. What I mean is that when there is no or hardly any demand, this lack of interest will determine what price something can be. Sorry if my reply is confusing things. I appreciate your responses

 

I don't believe those changes are the result of demographics at all. US prices for expensive coins have a substantial "investment" component versus collector buying. The inflated US price level is substantially and in many instances mostly the result of financial buying.

There is or may be some shift from US to world coinage but the financial flows are so minimal I don't see that it is measurable.

Though the size of the coin market (even the US coin market) is a pittance compared to other asset classes, most asset prices have been falling since at least 2011. This includes most world stock markets, foreign currencies versus the dollar and commodities. Its only because a few highly visible ones such as US stocks, sovereign and corporate bonds with negative yields from ZIRP and NRP and real estate in many markets have not that most people aren't aware of it.

Silver and gold are also in a bear market since May 2011 and YE 2011. Many coins are bought as substitutes and with the metals performing poorly, there are presumably fewer buyers paying less.

 

In the US and a few other countries, it is predominantly an "investment" buying culture which accounts for the higher prices or price level. This should be evident because the correlation between the price level versus income and wealth levels is statistically very weak. "Investment" buying not "real" collecting results in participation by more affluent buyers.

In the US, I believe (but cannot prove) that the more recent negative price trends Doug mentions are first, a reduction in speculation (aka, "investment") in most asset classes. This is for the more expensive coins with the qualifier that the crash after 1989 was a popping bubble.

And second for "collector" coins, most Americans are becoming poorer or a lot poorer and have been since at least 1999. I know this statement is very unpopular but I see no reason to believe otherwise for the foreseeable future either. That is, for as long as it will matter to anyone reading my comments now. The economic position of the typical American is going to continue to decline, though as in since 1999, it won't be without interruption since their will be temporary periods of improvement.

The distinction between the United States and most other markets is that the US is a "mass market" due to the size of the buyer base and the scale of financial buying. The "market capitalization" (using the same analogy as a stock market) of US coinage is a huge multiple of any single other country and presumably more than all others combined. So though compared to other asset classes it isn't worth much, it still takes a large number of buyers to support the price level in the aggregate, even though prices are set at the margin and most coins don't have many buyers individually. Due to this scale, there is a lot more correlation to economic conditions than practically anywhere else.

As to the prices of individual US coins, if you look at them and compare it to their relative merits versus other coins (mostly world coins but also within US), it should be evident that it is disproportionately hyperbole and marketing hype.

The last time I checked, there were 91 individual coins in the PCGS "Million Dollar Club", excluding die varieties. There are also a large multiple worth six figures and an even larger multiple worth five figures, including coins in each category but just in lower grades.

Are all or most of these coins really that significant? My answer is that other than the price and that so many US collectors have an inflated opinion of their merits, the answer is no. Most of the time, whatever the significance, it should be apparent that the price is more significant than the supposed merits, the latter which are often (grossly) exaggerated anyway.

 

I very much disagree.

Of course by the same token if youlook at these markets from the perspective of those making and losing money in them there is a tremendous amount of truth and insight in your words. I think a broader perspective will serve to cause more people to see the underlying forces that drive collectibles markets.

It's true that prices can increase even while total participation goes down but this requires that total inflow of money continues to increase; each buyer increases spending. Of course by the time a collectible is popular there is likely to be some price manipulation by sellers who'll act singly and in tandem to withhold product in the face of rising demand.

I refer to such foreces as Success breeds Succes because coins no one wanted one year are popular after their price increases. But this has to happen for fundamental reasons and no manipulator can start a market that hadn't already existed. These reasons vary widely but generally they are simply market segments that have never experienced demand because people tend to herd or perhaps, more accurately, people tend to follow the status quo. When a few do venture into an area many will follow but these first in may or may not reap massive profits and often times aren't even trying. Until even demand exists that manipulation can begin I call it "getting in on the ground floor". In collectibles the manipulation is obvious to the first in because suddenly very common items have high prices (Likw '77-C Indian 5p in MS-60) and very rare items have very nominal prices like Gem 1954 Rupees.

Fundamental changes tend to be demographic because each generation leans in different directions but there are other subtle and gross forces at play.

 

Okay, I think I understand. The decline would coincide with the Great Recession of course. So how about this answer: interest may have gone up in the past 15 years, but the recession decreased demand (due to financial insecurity) and so prices dropped. Other factors may have come into play but I think the recession is a large one. Distinguishing between the most expensive coin prices and lower end ones may complicate it more, since I'd imagine the very rich we're not affected by the recession. In any case, I see your point. Thanks