With rising unemployment when will coin market crash?

What stuff are you interested in ?

 

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The prices that Rick has on his shows are crazy. Sure, they are in slabs from NGC and PCGS, but I have seen slabbed coins with the same grade for a lot more. Is television markets going to fail? I only bought 1 coin from a television show and it was early on. Not sure what I am going to do. My wife and I are both retired state employees as well as social security retirement income. We own two homes, both paid for. Four cars, all but one is paid for. We live in the country surrounded by farmers that my wife taught 3 generations and they love her. We, frequently find a bag, box, or bushel full of fruit and vegetables. My wife (and her mother..now passed) canned every year. We are very fortunate. I only worry about my children, now in their 40's and 50's. However, I told them the same thing my Dad told me when I got married in 1968..."You are on your own now." I love my children, but they need to learn to take care of themselves. My coin collection was inherited and I buy from the Mint a couple times a year (Last year, a bit more.)

 

I've quoted actual prices in othe threads, but it seems that Rick's infomercials have prices about 25-30% over FMV, based on actual Ebay or HA sales.

 

1. A couple Classic Head Half Cents up in the VF/XF range.

2. Die marriages Capped Bust Half Dimes
The main problem here is most are on eBay and the pictures are so bad I can't ID the variety.
And the ones in slabs are in high grades that are too expensive for a set that isn't primary for me.

3. Competing my Early Commemoratives in MS-64 ±1 grade.

4. Waiting in the wings are Draped Bust Half Cents and Matron Head Large Cents.
I'm leaning strongly towards EAC material.

 

As to the question in the OP, it is the exact opposite.
These economic hardships have caused collectibles (baseball cards and coins)
to create more demand and prices have gone up.
When silver and gold go higher, coin prices across the board always go up.

 

Wow, agree with Doug twice in one day! (Drum roll!). The indices are NOT weighted. By definition, an index value is a constant, much as it is in Chemistry. When I was a professor of English, I made sure that my students who did numerical historical research use fixed values for the constants, as is the custom. Can values drop? Sure, and given the severity of the Pandemic, they will. However, the criteria for determining the fluctuations remains the same.

 

Which is the problem with it, everything is treated equally and you never get a real picture looking at everything as a whole

 

That's only true when the market is actually segmented into it's actual market. Trying to say that all coins are one market is the same as trying to say the oil and electric and coal is all the energy market, or that fish is part of the meat market. Whether it be stocks, commodities or hobbies there will always be stuff going up when the rest is going down and stuff going down when the rest is going up.

When you mix to many different unrelated things into one index you end up with something that tells you a lot about nothing. You cant just throw the kitchen sink into something and get any meaningful information, until major changes are made to the index it is absolutely worthless

 

I've said that a million times before.

There is no market as a whole for anything. There are segments that sometimes get lumped together and are called a market and if you look that the "big market" as opposed to the segments you have no idea what is actually happening. Index is attempting to treat coins as stocks, and just like in actual stocks and it is especially egregious for it's horrendous composition which is especially outdated today. There are more than enough things in that index that unless PM prices spike it will never really do much

 

Yes there is.

The Pcgs 3000 shows a good picture as the market as a whole and is independent of some biased hot air dealer blog. Segment indexes also available. The trend seems headed down and does not appear to have reached bottom.

The market has been in a steady slide for sometime (Pcgs) 3000x A crash may be on the horizon with possibility of bankruptcy major players. Will one TPG acquire the other?

Yes there are those heavily buried in big ticket coins or wealthy dealers and investors who will argue otherwise. They are the end user. I believe US coins overpriced as I am buying low pop world for a fraction of their US counterparts (pop wise).

Many who have lost jobs in this covid environment may find jobs but many of these new jobs may be a step down. Others due to age bias may not find anything at all due to a job market full of unemployed younger workers. A sort of covid double whammy. As bankruptcies and credit card defaults mount people will be more about survival vs buying coins. Many forced into retirement due to covid may be filing bankruptcy like a lot of them after oil price crash in 2015. One friend in coin club forced into Early retirement, depression then credit card / default as a consequence from oil price crash on $28 k cc debt. He settled it for about 40c on dollar. Covid fallout wb much worse.

Consequently a coin market crash is a very strong possibility. In addition players will cut back on paid subscriptions using free online price guides plus a reduction in grading submissions / stickering.

Many tired of taking losses going to bullion. This is understandable considering the weakness in US numismatic coins (PCGS 3000).

 

If they are all equal, then every coin is 1/3,000th of the total index.

If it's based on the PRICE of the coin, then it's a price-weighted index like the DJIA. So if a $20,000 1907 High Relief coin goes up 10% and a $50 coin goes down 10%, the index is going up by $1,995, all else equal.

 

Yes, they move with lags but if the move is SUSTAINED and STEADY then numismatics will rise in value.

The prices diverge when the derivative or 2nd rate of change turns NEGATIVE and/or when the drop (or rise) ACCELERATES and the move is not believed sustainable.

Numismatic buyers/sellers tend to try and discount the next 2 years of price moves, whereas most asset buyers look at the next few months.

 

Right, it's a price-weighted index and like the NASDAQ with the FAANG stocks, it's a narrow-driven market and the bulk of the PCGS 3,000 are falling.

Equal-weight the sucker and the drop is probably more prnounced from the recent and all-time highs.

 

Doug, I am hearing contradictory things in your explanation of the PCGS 3,000.

It's very simple....if each coin is 1/3,000th of the index -- if a common Buffalo Nickel counts the same as a 1907 HR Saint -- then it's an equal-weighted index in my mind.

If it's weighed by PRICE -- if a 5% move in a $20,000 Saint is +$1,000 whereas a 5% move in a $100 Buffalo Nickel is $5 -- then it's price-weighted.

It can't be both...has to be one or the other.

I know I come from a financial background but an index is an index. Just have to figure out how it is computed.