The coin business continues to slow.
DollarAfterDollar
Posts: 3,205 ✭✭✭✭✭
I was in my local coin shop yesterday and was engaged in the typical topics of discussion. In my experience there's not much difficulty finding coins that are a great value. The question is why? It appears that values continue to plummet because there is less disposable money for most and there are decidedly fewer collectors, that was the overall belief.
We're getting to the point where price decreases across most coin types seems to see no bottom. My brick and mortar owners are openly questioning their ability to survive.
Are there any bright spots?
If you do what you always did, you get what you always got.
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Yes, there are bright spots.
Specialty dealers on the internet with great photography without the B&M overhead costs seem to be doing quite well.
Are there any bright spots to the coins we've wanted for years becoming more affordable and available? A "great value"?
I mean. If the depth of your passion for coins lies solely in your desire for them to make you money in a few months, then I guess not.
--Severian the Lame
I've always enjoyed coins, and and multiple levels of cost. Perhaps the collector base shrinking, due to so many other options being available to fill one's time, will continue to push demand (and thus price) down, but I'll still enjoy coins at whatever level I can afford.
Check out my current listings: https://ebay.com/sch/khunt/m.html?_ipg=200&_sop=12&_rdc=1
As collectors, we kind of have a "Love-Hate" relationship with the coin market.
Prices rising? Great! My collection is worth more. But, damn, I can't afford anything....
Prices falling? Fantastic buys out there! I can add to my collection. But I'm losing money in the process!
Just go with the flow. Don't spend what you can't afford, and enjoy the coins and accomplishments that you can afford. And whether the market gets better, or worse, won't matter.
It's a hobby.
I've been a collector most of my life. For the first 20 years my source for coins was pocket change and lot's of coin shops. The next 20+ years it was coin shows and a few coin shops. Now it's pretty much the Internet and a few of the bigger coin shows.
Of course there's no finding anything in pocket change anymore, and I haven't been in coin shop in years. I stopped going to coins shows unless it's a 100 tables or more since it's so much easier to shop and find the good stuff on the Internet 7x24.
If they keep doing things the way they have always done them, they are probably doomed in the long run. They need to adapt to the times, namely they need to also sell on the Internet, such as eBay as well as perhaps their own site.
There is a place a couple thousand miles away from me - a little B&M coin store - that I buy from on occasion. They list their inventory on their site, and if they have what I need then I buy from them. That is extra business they would not have gotten if they were not on line.
As for B&M coin stores, the physical presence allows them to get walk-in business, whether buyers or sellers. The Internet allows them to sell to a larger market. This is especially true of stuff with a more limited collector base. There is lots of stuff that would get bid on and sold on eBay that would probably never fund a buyer if it just sat in a display case in a store.
Yep. The sky is falling.
I have no doubt the traditional B&M dealers are having a hard time of it. Ask Sears & K-Mart how well they’ve adjusted to the new world. The market goes up....... and down. Many areas of collecting are soft right now. Far worse has happened in the past. Is this time different? Time will tell.
If you can go to ebay and find 200 examples of something instantly then it's probably still got a lot of room to fall. Like I posted in the MS65 morgan thread a few weeks ago, common MS65s are down to $100 ish wayyyyyy down from their peak but that still seems way overpriced to me with just how incredibly common they are. I wouldn't be shocked to be able to pick up a common 65 for $60 in the near future.
Great eye appeal high quality tough to track down stuff is thriving tho from my experience. I've posted 3 videos on instagram in the last couple weeks of coins I've bought in the last 6 months for between $700-$1,500 and I could about double my money on each from the offers I've got (if they were for sale - I just can't do it!).
Specialty dealers have been picking off bits of brick and mortar dealers' lunch for years now. They pay way more and they have ready customers.
This is partly the result of bad price guides that show artificially low prices on many items. Many new collectors are specialists as well and often collecting more esoteric items.
With more and more specialty dealers there is less and less left for the dealers. They will eventually have to survive on the crumbs and buying coins from the general public.
This is largely just evolution and many dealers have been adapting by having a greater on-line presence and doing some of their own specialization. Others will often fall by the wayside.
Fixing the price guides will save a few dealers in the short term.
Beautiful coins with attractive color are still sought after at this present time. For these particular coins the market is strong but not as strong as in the past. No fear this is the oldest hobby on the planet and has thrived for many, many years. If the market goes down I’ll be able to locate some great pieces to add to my collection. Then when it goes up I’ll be sitting pretty. This hobby will never die. That I can guarantee you.
Happy hunting, Joe
I tend to agree with Crazyhounddog however, buying even outstanding examples at reduced prices can still result in paying far too much. I think overall there will be two groups of coin "owners" in the future, Some will be active buyers and sellers but the greater number will be those who buy and hold to sell in the years to come.
Buying a rare coin with wonderful "pop" today might well be eclipsed by coins in strong hands in the years to come.
Are there any bright spots? You bet, as a buyer you can regularly buy pre 33 US gold coins under the spot price of gold. Same with rolls of 90% silver coins. Slabbed Morgans and Peace dollars, I've never seen them cheaper. Buy low sell high my friends.
The whole worlds off its rocker, buy Gold™.
In Springfield IL the leading bullion and coin dealer just this week moved out of a custom-built facility that it had occupied for more than 30 years.
I haven't seen the new facility yet, but I will bet that they have lost their custom melting furnaces.
Seems to me that the Coin business is a lot weaker than five years ago.
How can I get some of that action, buying pm coins at or below spot?
Ebay, the marketplace that never sleeps. Wait for your bonus buck offers then snatch them up. Use the bonus bucks you earn to buy more, kinda like dividend reinvesting. Net realization, Metal below spot. It's a no brainer.
The whole worlds off its rocker, buy Gold™.
The internet and auction houses are making the middle-man dealer less relevant. The very nature of the brick and mortar creates a cost structure that must be added as a retail mark-up to coins that will be difficult to survive in the age of the internet.
The "bright" spot for me is that I can enjoy a hobby where there are less and less people that feel that need to step in the way to broker a coin deal marking up coins along the way. The coins I bought during the 2011-2016 period have dropped a lot, but coins I am purchasing now seem very affordable relatively speaking.
I no longer buy retail coins anywhere (or rarely) or on the popular retail website masquerading as an auction venue: Ebay. There are so many choice coins available now at the larger auction houses that I can barely keep my from blowing a gasket from excitement.
I am currently watching 30 coins at Heritage that I probably wouldn't have seen in a years or two time on Ebay. Every single coin is a true auction, not one is ridiculously marked up like a coin on Ebay would be.
E-bay has created a reverse auction.
You know, when the auctioneer keeps going DOWN in price to get a 1st bid.
Except the "auction" is a "buy-it-now".
I'll also low-ball "offer now" at insulting prices because I have no shame.
Do that 10 times/day & someone will bite.
I wouldn't do that face-to-face with a real dealer.
My Saint Set
I still believe that the number of young people getting interested in coins while in their teens keeps on declining. There are too many other things to distract them and keep their interests, like video games and cell phones. The young ones want to do most of their shopping from the comfort of their cell phones. Yes dealers with just an internet presence and good photography capabilities might continue to thrive for now but they too will see prices continue to decline. I think the decline has a long long way to go.
a.k.a "The BUFFINATOR"
If the price drops, buy.
If it drops a further 10% buy even more.
If it drops yet another 10-20% buy like crazy.
If it hits 60 % drop from start, get second job and buy.
If it drops another 15% from there, buy even more.
But whatever you do, don't sell the pistol!
A man came in and bought four folders for statehood and ATB Quarters yesterday. I'm glad he didn't ask for the Quarters. I used them at the car wash.
So the folder market is showing strength. Good news.
There seem to be many undervalued areas and many overvalued areas.
Prices will always be in a state of adjusting to supply and demand. Demand will rise for certain things and fall for others. I don’t think it’s fair to paint the market with such a broad brush.
Dealing in Canadian and American coins and historical medals.
That in essence is the crux of the problem. There are many more collectors going out the back door than coming in the front. Sure some areas of the market have posted strong increases, but really these, for the most part, are the more rarefied areas or items like toned coins etc. The decline in many areas has been slow but it is there in the more broad sections of the market ie: the more common series etc. In addition I think the boom created by the TPG's is coming to the end of the trail. With this I mean the excitement that the casual or semi-serious collector experienced when they realized they did not have to know how to grade really, just pony up some ducats for a nice, plastic entombed coin. Now grade inflation, poor return when selling etc. is making a dent in their collecting commitment.
Ponder this for a moment...my kids are in their teens and the number of opportunities for them to even encounter a coin is few and far between. Everything is electronic...my daughter has not had any cash on her in months, everything she gets from babysitting etc. goes right to the bank and is then spent via a debit card. Tough for them to get excited about coins when they are not part of their daily lives!
But...there are many of us who see a decline as an opportunity to obtain coins at a fairer price, so we will.
Not trying to be a downer, just a realist.
K
The trouble with a lot of the brick and mortar I have visited over the years is that they just didn’t have very much interesting inventory. Most of their coins were easy to find modern material or lower grade older coins. Their prices also tended to be high because they had a significant overhead to cover.
I know that I have a lot more than most collectors do and that I’ve grown accustomed to early type material which I have owned for years. I have spoken to B&M store guys who held pre-1800 U.S. in awe and said they seldom handled any of those pieces. Still, you have to get the good material to attract the bigger collectors who usually make up a lot of the financial core of your business.
If you don’t have the good material, you won’t get them to come back, but a strong inventory requires capital from whatever sources you can find to get it. That can be your own money, but it can also be other’s money. I used to take coins on consignment from other dealers, and I had a good track record of turning them over quickly (less than two weeks) at the shows or to my better customers.
In my day there were multiple ways to succeed. Today with the Internet there are even more options. It just takes some innovative thought and a talent for the business. If you don’t know much about coins, and can’t grade them, your chances of succeeding are not good in my opinion.
Online been doing well for me. Shows (I set up) some good buys but sales forget it. The people coming in the door for the most part are either broke or have blown their money online and nothing to sell or some inflated idea what they can get. At last 2 shows other dealers will look at my really nice material and give me a spiel about they looking buy below bid. I tell them “got some sell me at that?” They get the message and move on.
Common Dollars in 65 have fallen to $110 bid in the sheet. Will they go lower? Certain dates of these are multiple times scarcer than 1881-s these seem like good buys. Expect some serious competition for these many will put in AS mb of say $125 if nice.
The future of the coin business is online. B&M shops that have low overhead will survive this is a good base buy material right from walk ins flip at show. However for me security a major concern.
The problem with lower-end coin shows is that it is like an audition for robbery/burglary.
I will no longer go to the show closest to home. There is a crowd, but at least four guys whom I believe are in attendance simply looking for burglary targets.
I also agree the earlier statement "The people coming through the door are either broke or have blown their money...". Sadly, I've known many older coin collectors who have greatly reduced their funds/savings pursuing this hobby too far. I am trying not to fall into that bunch myself...
Interesting conversation... and several perspectives - all of which are part of the big picture. Since I am not a dealer, I can sit back and reflect on this information. There is definitely a shift in the world of commerce - malls are dying, large anchor stores (Sears, Penney's etc.) going out of business....Internet sales are booming (as well as UPS, FedEx etc. delivery services) ... Since there are no coin shops or shows in my area, I can only deal with the internet - and I have not seen prices dropping there...Yes, if one uses Ebay bucks etc., there are deals to be had...Other than that, coins are still expensive there. Also true, I am not a volume buyer... just niche coins that attract me - so I do have a narrow perspective. Much like evolution, business must adapt or die.... However, the hobby will survive and thrive.
Cheers, RickO
Reason being that (in my case anyhow) .....local...collectors are too chintzy to step up to the good stuff and the price that the B&M dealer ...KNOWS... he can get from the regular "roadies" who actually supply the great stuff that's spread over various quality dealer websites.
I seldom even bothered to buy for advanced collectors. For one thing, I had too few. And the ones who ASSURED me that they wanted phone calls if anything "neat" came in were nowhere near their wallets when it did.
B&M stores are for bullion, scrap gold, and proof sets for the grandkids.
And I even had to wholesale crates of proof sets because even those kept flooding in from...er... "collectors."
I would consider taking a table at the local shows if there are any in your area. If you have any regional shows, I would definitely buy a table there. You would be surprised at the caliber of the collector who shows up at those shows and how much money some them have. Most of them were not dressed to the nines. You learn, don’t judge the book by the cover!
I worked in the Boston, southern New Hampshire and Connecticut areas when I lived in New England. I had one day local shows where my sales exceeded $30,000. At the reginal shows, my results were the same or better.
The shows were also important for making valuable contacts. I had customers who were too busy to go to a lot of shows. They gave me their want lists, and I worked on stuff like a complete set of Morgan Dollars with an 1893-S in AU-58 and a Proof-63 1895-P. I had collector who got into Proof pre-1920 gold. I sold him a $5 Liberty in Proof-67 Cameo and a Matte Proof $10 Indian. The $5 gold was an awesome that was as nice as the new Proof gold coins the mint was issuing.
When I was active, there were opportunities out there, but you had to be ready to sell just about every U.S. coin that was in the Red Book. I also had a fairly large business in Civil War Tokens. The margin from them could cover the table rent or more.
Maybe things have changed since I retired, but that’s what worked for me.
To a crawl.... on my knees.
Doing a show would be like....working... again.
I can honestly, truthfully, and sincerely state without reservation ...that quitting the shop.... was the best thing I ever did.
If I had to deal with the public again I think I'd shi.....er...SHOOT myself.
I think the elephant in the room is that most "rare" coins aren't rare. Much of what people have been trained to collect is fungible - that is, it can be easily replaced with an item that is essentially the same. Why stretch to buy anything that isn't irreplaceable?
Granted, third party grading helped to take common items and stratify their values, creating condition rarities for every issue, but in many cases, impressive looking examples of readily available coins are still available at a fraction of the cost of the finest pieces, and most people can barely tell the difference.
The consequence is that there isn't much pressure to buy 95% of the coins that come to market - we all know that something similar - or maybe something better - will come around next week.
What is now proved was once only imagined. - William Blake
I might be off in my thinking, but I think that, on average, a higher caliber collector or novice comes to coin shows than to shops. That's not to say that the shop didn't used to do well with buying in the old days. Back then great stuff used to "walk though the door" just like it has for some dealers on eBay who told me they "picked off" some "real rips." Years ago the store people told me not that much walks through the door any more. The supply of great stuff in family hoards seems to have dried up.
Well, I ....do... go to shows to ..buy.
Occasionally.
Can't resist the cases full of raw coins in 2x2's.
No offense, Bill Jones.
Things have changed since you retired.
That's okay, I coming from a ten years ago perspective.
What this thread needs is a coin photo..
My guess is B&M dealers who have inventory like this are doing ok.
It's been my experience that the "semi-public dealers" who meet clients in an office like setting, and are not in street level stores are doing okay. Stree level stores drive up your overhead and your theft risks.
To me the best thing you can do as a dealer is to engage the client in interesting conversations about coins, including the history to spark their interest.
While I completely agree with this, there will come a point where less-than-rare coins are so cheap that collecting them will make sense, even to more sophisticated buyers.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Maybe - the problem is that so many of us have stoked the whole "coins as investments" angle that a lot of the current buyers might have a bad taste in their collective mouths.
What is now proved was once only imagined. - William Blake
I agree 100% also the same reason I refuse to join the local coin club.
The whole worlds off its rocker, buy Gold™.
I decided to collect draped bust quarters by die variety and die state after driving all over and visiting every coin shop in town, and none had even a single example to show me, much less sell to me. ..
"But how about a nice shiny Morgan, son?!?"
Liberty: Parent of Science & Industry
Many of the shops have made huge money on collections from time to time, so if they are hitting a drought maybe that is just natural law, no guarantees in business.
I stopped at one about an hour away last week, dealer said it was very slow but he didn't have a lot to sell anyway. He showed me a bar cent "usa" that came back as an XF40 and a triple struck Indian cent graded MS62 among other better coins. He said they were going into his private collection, so I doubt he is starving.
I agree that the collector base has been diminishing and that has really made the common coin all that much more common because the demand has dried up.
I would guess that a person with deep pockets could go to a very large show and find at least 90% of the dates of all copper, nickel, and silver coins minted in the 20th century in XF and lower grade. That’s how common some of this stuff is.
MS 64 and lower Morgan Dollars of the commoner dates are a dime a dozen. It really has become a buyers market, which is great for a buyer especially if one has time on their side.
That said, there are other coins that are a pain to find and they command deservedly so, higher prices. Try to put together a date set of seated quarters for instance. You can find all the 1853’s or 1857’s you want among other dates. Try to find the tougher ones that catalog for a few hundred dollars or more.
It will help when the "non approved" coins finally get sold.
Then the endless repetitive everlasting "cobweb" coins will finally drop off the listings.
My experience doesn't quite reflect all this doom and gloom. The coins I want to buy have not decreased in price. They are scarce and when they do show up you need to be prepared to pay above price guide for them.
I don't think the amount of money being spent on collectibles is decreasing. The major auction companies continue to set new records for prices realized, both for individual lots and for total sales. Deep pockets are out there. As we've seen, attractively toned coins command exceptional prices these days. Top grades as well.
But of course the market is evolving. The Internet has killed the B&M business model for small collectibles. Coin shows as retail venues will die out as the last of the non-internet dealers disappear, and as the last of the non-internet collectors disappear. Nothing "walks in the door" anymore because anyone with half a brain can figure out the value of a slabbed coin in a few minutes and send the coin to an auction house or list it on eBay.
As long as you collect for fun and not profit, none of this matters. Buy what you like and carry on.
LIBERTY SEATED DIMES WITH MAJOR VARIETIES CIRCULATION STRIKES (1837-1891) digital album
Most B&M coin dealers are dying a slow death. And, the internet isn't responsible, it was/is a lifeline for those who have the foresight to reform their business model. There are a lot of grumpy old B&M owners who will go to their graves along with their outdated and nearly worthless stock!
...so dead, I can't believe I took the time to post!
Agree and many of them are simply there to steal or rip something. Others such broke or cheapos not worth my time. Then dealers or vest pocket traders just trying buy below bid. Am polite to all and sometimes a deal can be worked buying or selling.
Just like my strip clubbing hobby use my stage name on my coin dealing business card, burner phone number. No address, website or anything else. Beautiful coin photos though lol.
At a show I have everything in my cases (locked when away from table). I do not let somebody take multiple coins from the case to look at but am glad to keep tally sheet on items which they bought retail. Early on I came to detest pickers and those taking too much time going thru junk boxes so no more jb. I attend shows buy and sell at my price.