Simple third grade math!
MrEureka
Posts: 24,332 ✭✭✭✭✭
Sitting in a bar at a coin show hotel sometime in 1989'ish, well past midnight, a famous coin dealer friend explained his business strategy to me.
He said, more or less, that if he owned a coin that "bid" at 3K, he could raise the bid to $3500, have the Graysheet report his bid, and "make $500 overnight". If someone sold him a second piece at $3500, his average cost would be $3250 and he would still be up $500, so there was no risk. (He would own 7K worth of coins at $6500.) So bidding the coin up was a no-brainer. In his words, "simple third grade math".
Well, of course he had to sell the coins to actually collect his profits, but in 1989 that was no problem. Coins were selling well.
Here's the question for you guys: In the current environment, how easy would it be for dealers to run the coin market up 100% using my friend's 1989 strategy?
He said, more or less, that if he owned a coin that "bid" at 3K, he could raise the bid to $3500, have the Graysheet report his bid, and "make $500 overnight". If someone sold him a second piece at $3500, his average cost would be $3250 and he would still be up $500, so there was no risk. (He would own 7K worth of coins at $6500.) So bidding the coin up was a no-brainer. In his words, "simple third grade math".
Well, of course he had to sell the coins to actually collect his profits, but in 1989 that was no problem. Coins were selling well.
Here's the question for you guys: In the current environment, how easy would it be for dealers to run the coin market up 100% using my friend's 1989 strategy?
Andy Lustig
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
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I firmly believe in numismatics as the world's greatest hobby, but recognize that this is a luxury and without collectors, we can all spend/melt our collections/inventories.
eBaystore
theoretically you buy same coins to run up the price and you'll show a paper gain, but you'll have to sell the price back down to collect. theoretically you break even. any profit/loss is coincidental.
kinda of like when the hunt bros tried to corner the silver market - it doesn't make sense.
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