When will modern coins and currency become valuable?

I think a diligent collector will keep a nice set of current coins, because maybe not now but in future years they might valuable. Look at the rare 2009 issues, as time goes on the will be harder to find. In 50-100 years they might be worth more than now. On a side note, I was reading some back issues of the Numisatist and saw an ad that some was saying the best investment was in call coinage. I think it was in a 1972 issue can't remember which one, but it pointed out all the rare issues that had already happened like the '69 No S dime and other. When I get home I will see if I can find it and take a photo.

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If there is ever a CoinTalk Hall of Fame created, this guy needs to go in first ballot.

Huh??

We've discussed this several times before on other threads. If I remember correctly, I read that metal refiners usually pay about half of melt value for copper. The reason for the significant reduction is mostly due to the costs of smelting (along with some margin from spot price). I don't understand why they charge a percentage of melt value and not a fixed amount.

So in order for pre-1982 cents to be truly worth more than face value to a hoarder, the melt value has to exceed double the face value. In other words more than 2 cents.

At current copper price, melt value is below 2 cents. However, copper price reached a peak of about $4.50 per pound in 2010. At that time copper cent melt values peaked at about 3x face value.

With that said, even if current melt values were 3x face value and you called a reclamation center as Chris suggested, you would not be offered anything at or above face value because it is currently ILLEGAL to melt cents.

Now the big question is, when cents are discontinued and therefore become legal to melt, will the price of copper rise or crash? I personally think copper price will crash because of the new supply.

 

And it depends on what kind of alloy they have to deal with. How do you separate the copper and zinc? Easy if you don't know how, difficult and expensive if you do.

 

If you call any reclamation center, you don't have to ask what they pay for copper cents. All you have to do is ask them what they pay for non-Grade A copper. The last time I checked with refiners scattered around Florida, they were paying 25% of the price for Grade A copper.

Chris

 

Thank you for clarifying. Good stuff.

 

I'm surprised nobody asked why I thought moderns have finally started their move! It would have already happened except the 2008 recession flooded the market with mint sets and swamped the demand. These sets have now been worked off.

All the roadsigns have been in place for a few years now but there has been no catalyst and no spark for the move. I believe the catalyst is the gradual disappearance of the older style quarters from circulation and the spark now is a wholesale (probably HSN related) demand for coins from these sets. Even existing demand at the wholesale level has been going unfilled and now there is sufficient new demand to suck up every mint set available for sale on the market. Add to this the fact that mint sets have been flowing to the general public through untraditional venues siphoning off lots of the ready supply and this is a prescription for some scrambling to fill orders. This scrambling will actually tighten the market as many would be sellers hold out for higher prices.

To some extent this could be somewhat self containing because increasing prices will impact demand. Shop at Home customers will be more reluctant to buy mint set collections if the price is substantially higher.

It will be interesting to see how this plays out over the coming weeks and months but frankly a buying panic would hardly surprise me. Many dealers don't even stock this sort of material so just the demand for stock will swamp the supply. Even those do stock it willusually have only a few coins of each date and mint mark and these could walk out the door almost immediately. It should be remembered that the typical clad dime is selling for only a quarter or fifty cents so a tripling of price will hardly suppress the demand.

 

It's been a great time has it not?

We've seen the coin hobby and numismatics move into the information age and all the tremendous transitions that have resulted from this change.

Yes, I ve always said this day was coming but this is the very first time I've said it's at hand. I've watched the last several months as more and more anecdotal evidence has accumulated to show that moderns are getting direct attetion from hobbyists. These collectors run the gamut from newbies attracted by the states quarters to younger adults who have established families and are returtning to the hobby. There are even a few older collectors talking about moderns though I see less actual buying or collecting among them. I've wanted to speak about this for months but I didn't know how long the accelerating demand would bump up against supply constraints. I feared if I suggested moderns were going up now and I was wrong I'd lose any little credibility I had. But now the signs are nearly uneqivocable and this appears tobe finally the real world asserting itself in the modern markets; there just aren't enough coins for the still very small amount of demand.

It's still even now impossible to predict how big this is. Numismatists have not only ignored moderns for many years but they've ignored the modern market and the coin hobby and many hobbyists. The hobby is simply going to make itself known. There are many many new collectors who'll spend years to get the experience and dominate coin shows as older men and women. It will come to be seen that they were numismatists all along though it might take some time for many to apply the term to them.

...And, if I'm wrong, it will be nothing new.

 

Technically, their copper value is about 1.5X their face value.
http://coinapps.com/copper/penny/calculator/

 

Technically? How many reclamation centers did you call and ask what they will pay for non-Grade A copper? I'll bet the answer is none. It's too easy for you to Google some idiot who has never called a reclamation center himself.

Chris

 

Technically means just that-- there are approximately 150 copper cents in a pound. The market price of copper is currently about $2.21 a pound. That means that technically, the value of the copper in the pennies is more than the face value. Put another way, if Uncle Sam tried to make copper cents again, it would cost him roughly 1.5 cents at the current market price just for the copper for each cent. Thus, the copper is technically worth more than the face value.

And who sells their coins to a reclamation center, anyway? Would you sell 90% silver to a reclamation center?

 

Technically must mean that you are too lazy to call anyone.

Yeah, that's right! If the government legalized the melting of copper cents, you'd just sell them to another dummy. Wouldn't you!

Chris

 

Many moderns already do have value and some even significant value in the top grades or with colorful toning (aka toned ASEs). In my opinion the modern market has a lot more similarities with the classic market then most people realize. Sure there is a lot of modern stuff you can get below mint issue price or for face value or not much over face in the lower grades, but think of all the low grade classic coins that also sell for basically melt value or the many Morgans you can get for around 2x of melt. The top grade levels are certainly higher for moderns and in most cases high grade examples are much more available but is it really all that different then classics when with both certain varieties and the top grades have substantial premiums where the common coins have a slight one at best?

The major difference really seems to be the stigma that some attach to modern collecting.

 

Certainly. Yes.

The thing that has always surprised me is that even the scarcer moderns have never had the kind of demand to drive up the price. Most just don't understand that some dates of these just always look like garbage and they weren't saved so even the garbage specimens aren't around any longer. One of the most dramatic examples of this is the 1969-P quarter. The rolls were so horrendous and the interest so low that it's virtually impossible to find an original BU roll of these. People didn't set them aside because they were so ugly. You'll see rolls advertised but without exception these will be mint set rolls. The mint set coins tend to be ugly as well. About 8% of mint set coins are nice MS-63 or better. Well, they were nice MS-63 or better but over the years most of the sets have tarnished so now even among the few surviving sets it can be difficult to find choice specimens. It's not a case that the coins from the destroyed sets are still around either. Most of the coins from destroyed sets have been spent because they were ugly. Only a few percent (~1%) of the original mintage is on the market or readily available for sale and only about 3% of these have nice pristine Philly quarters. This implies a "ready supply" of only some 540 coins!!! You might say "collectors don't need a choice specimen because most will be satisfied with MS-60" but the reality is these coins are ugly so collectors may not be satisfied with them.

Across the board these considerations apply to all the circulating moderns to a greater or lesser extent. There are lots of coins that are nearly as tough and if you desire Gems are even tougher. With the classics the coins were in collections and it was just a matter of time until another collection came on the market but there are no old time collections of moderns because there was a stigma attached to collecting them.

It's also not a simple matter of plucking AU's or XF's from circulation. These coins were sometimes attractive but they are long gone, lost to the ravages of time and wear. Indeed, even finding nice attractive VF's can be very difficult.

 

I watched these markets for a very long time and I just don't believe there are modern collections out there other than those assembled relatively recently. The interest started around 1980 but there might not have been a dozen collectors in the early days. By '90 it was a few dozen and and a couple thousand by 2000. Now days I'd estimate 10,000 but in addition to these there are half a million casual collectors of the old clad quarters. It's these casual collectors exerting an influence on the market as they try to complete or upgrade their collections. Much of the pressure right now that is about to affect prices is dollars and half dollars; the numbers are lower is but so too is the supply.

Yes, I know there are lots of collections assembled by wholesalers out there but these are rarely very nice and will have little impact on the supply for the more important coins.

I've seen what comes into the shops for the past 40 years and none of it is nice modern collections. I've seen massive hoards of XF/ AU better date early clads and have taken these to the bank. I've seen the sets that people bought retail or from HSN. What I've never actually seen is a collection that was carefully assembled of choice coins and included a few of the varieties.

Yes, I have what I think is a nice collection. I started assembling it in the late-70's from the Gems I acquired from driving around to banks and coin shows. I also have been able to amass a few thousand more Gems over the years but what I couldn't do is save everything. I simply couldn't afford to tie a lot of money up in coins that might never be worth anything. So when I bought a nice gemmy bag of 1982-P quarters from my bank all I could do was pull out the nicest few and return the balance.

Yes, there are a few other entities who have done about the exact same thing. I can only guess how many coins they have but nobody can have a controlling share of the coins because they were so widely dispersed. Acquiring them is difficult, time consuming, and hard work. I doubt if all the "hoarders" all together have 10% of the market. The rest are out there in private collections, registry sets, but mostly still in the "wild"; sitting in mint sets and dealer stock.

I'm selling into the current strenght a little bit but mostly for strategic reasons. I can't even break even at current prices far less make a profit on the money I've tied up in some of this. My current big project is just to get my safety deposit boxes organized well enough I can find the coins to sell. Right now the market needs supply.

 

Yes. This has happened many times before. Not as much with US coins as with world coins. But you can see it with coins like the 1883 "no cents" nickel that was save in large numbers while the "cents" version was relatively ignored.

One of the biggest differences now is that the FED began rotating their coin stocks in 1972 so all the cooins have worn down evenly since then.

 

I've seen some huge collections and have toured the Silvertowne site in Winchester, Indiana. I once saw an original hoard of nearly 1000 1970 mint sets. These came from the original owner and had lots of Gems. I've heard of things like bags of '31-S dimes and once met a guy who bought dip by the drum because he had so many toned Morgans.

I've not seen much evidence for modern coins like BU quarters. Back in 1983 Numis News reported some east coast vendor who saved a bag of each date. Other thanb this this there aren't many stories.

 

I was just thinking. There's another way to tell these markets are about to move. Look at the '82 and '83 quarters in change. A few years ago these were the easiest dates to find in XF and AU in circulation of all the dates from '77 to '90. This was caused by large numbers of people pulling them out of circulation and then inadvertantly or intentionally rereleasing them. Ten years ago 1 in 50 was XF or better. Now about 30% of the mintage of these is missing; pulled out by collectors. But more importantly even nice VF's are rearely seen now. Forget AU's, I haven't seen one in five years. This date is in as bad of shape as the '69-P which is much older and should be far more worn.

Of course these are going to remain common in XF since they have been picked out but we must be near a tipping point where collectors are wondering where all the nice coins are. Coins like the '77-D are pretty tough now days in nice attractive condition. Forget dates like the 71-P or '69-P. You're lucky to find ugly specimens of these.

And every day more and more of the old coins are lost, destroyed, or pulled by collectors and then replaced with a new parks coin. Everty day the old coins are worn a little more and ever closer to the end of their useful life.