Friday Evening Post: What goes up must come down?
keets
Posts: 25,351 ✭✭✭✭✭
Wondercoin kinda headed me off at the past with his "fruit thread" and I know the current state of activity in the hobby has been discussed before, but not too much I hope. What I wanted to ask everyone tonight is this-----given all the changes in the last 7 years or so, do you think what's happening will necessarily follow the pattern of the past market surges??
The ones familiar to me are 1980 and the Hunt Brothers silver debacle, the 1989 speculator/investor debacle and whatever happened in 1994-95 that caused prices to rise somewhat-----I missed that one. This time around seems a bit different to me for several reasons.
For one, diehards are educated from the past and should be able to avoid the same mistakes, wade in a bit slower so to speak. Just the fact that we discuss "waiting for the other shoe to drop" bears that out. And at the same time newcomers to the hobby are better educated and more sophisticated as a whole. That's gotta be an offshoot of the internet and the available information, this forum a part of that. What keeps popping up in my mind is that while the rest of the economy seems to be in the dumper, jobs are tough to find if you need one and interest rates keep going down, down, down, coin prices take the other tack with eagerly willing buyers.
I also think the U.S. Mint is helping us all with a well thought out marketing approach. Whether you like the State Quarter Program or not, it works for most people. There are some nice commems on the table and the nickel redesign, I believe, will prove so successful that they'll look at other changes. Good entry level oppurtunities like those are a benefit to the hobby down the road.
All in all I see a bright future, but then I tend towards optimism!!!
What about you??When the tree falls in the woods, will anybody hear it??
Al H.
The ones familiar to me are 1980 and the Hunt Brothers silver debacle, the 1989 speculator/investor debacle and whatever happened in 1994-95 that caused prices to rise somewhat-----I missed that one. This time around seems a bit different to me for several reasons.
For one, diehards are educated from the past and should be able to avoid the same mistakes, wade in a bit slower so to speak. Just the fact that we discuss "waiting for the other shoe to drop" bears that out. And at the same time newcomers to the hobby are better educated and more sophisticated as a whole. That's gotta be an offshoot of the internet and the available information, this forum a part of that. What keeps popping up in my mind is that while the rest of the economy seems to be in the dumper, jobs are tough to find if you need one and interest rates keep going down, down, down, coin prices take the other tack with eagerly willing buyers.
I also think the U.S. Mint is helping us all with a well thought out marketing approach. Whether you like the State Quarter Program or not, it works for most people. There are some nice commems on the table and the nickel redesign, I believe, will prove so successful that they'll look at other changes. Good entry level oppurtunities like those are a benefit to the hobby down the road.
All in all I see a bright future, but then I tend towards optimism!!!
What about you??When the tree falls in the woods, will anybody hear it?? Al H.
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Comments
<< <i>For one, diehards are educated from the past and should be able to avoid the same mistakes, wade in a bit slower so to speak. >>
Those diehards were rubes and didn't become diehards until they got burned. There's a rather large group of fresh rubes just waiting to be plucked. It's the same with anything to which the label "investment" might be attached. It'll happen again.
Russ, NCNE
K S
hey russ
of course it'll happen again, that's a given. i'm only wondering if the fall will be as loud, as sustained and as damaging to the hobby as the other noteworthy ones in the past. they were motivated chiefly by speculation and that doesn't seem to be as much of a factor currently, though it is present. there's more going on today. look at the life you've pumped into a single series!! i command you, clone yourself!
al h.
I am going to repeat here my comment from the Wondercoin "Low-Hanging Fruit" thread, with a couple of edits, because I want people to see it ...
What goes up may well come down ... who will be caught holding the bag? Certain dealers LOVE LOVE LOVE to point out that "The 1989 high for this coin was $50,000 and you couldn't even FIND one !!!" What crap. (Sorry guys !!) Most of those 1989 highs were reached for a 1-2 week period before a precipitous plunge. Most sellers could NOT unload at those "highs." Furthermore, when I read about 1989 highs, I think to myself: this is just proof that THE COIN MARKET CAN GO DOWN PRECIPITOUSLY, AND STAY DOWN for 13+ years. Think about THAT when you spend $25K for a DCAM Lib nickel, or $15K for some modern PR70 DCAM (mintage 8 zillion and not that long ago, pop 1/0, how many more widgets will the gods of slabbing create ... )
Sunnywood
Sunnywood's Rainbow-Toned Morgans (Retired)
Sunnywood's Barber Quarters (Retired)
remember large numbers of new collectors joining the ranks in the late '50's
and early 60's. They had a profound effect on all the markets they touched.
This is MUCH bigger. People will be amazed at how deeply and widely this af-
fects all the markets. They will also be amazed with it's duration. Moderns are
already in the eighth year of a bull market and if anything they appear to be
getting hotter!
There are trends, traditional measurements, and indicators that all can be trusted, analyzed, and thought through. All these factors are important and should be watched.
However, the internet has permanently thrown a wave into the investment fields market. The internet, the State Quarters program, and the return of silver sets/commems have also permanently thrown a wave into the coin market.
hey sunnywood
quick to rise and quick to fall descibe 1980 amd 1989 well as you indicated in your post. what we're in currently has grown slower, dontcha think?? what cladking says makes sense to me, also. those other two periods were more about money and getting rich quick. while that applies in part today, there seems to be more genuine "collecting" going on, people assembling sets with an eye on the future if only till 2008.
in the past there was no internet and hence no access to the volume of coins that there is today. that results in a more competetive market which is always healthy...........
al h.
What exactly happened for the 1-2 weeks in 1989 that fed the explosive increase in rare coin prices? I have heard that it was Wall Street investors getting burned by coin dealers. True or false?
Camelot
I've been a collector since 1971. When I saw this happening, and the prices raise weekly just before the crash, I started buying circulated coins again. When the market crahed, I started to buy the high end coins again. At first dealers were relunctant to take their losses. The line was I know the value of this Buffalo nickel is now $50) but I paid 120 for it and 3 months ago it was worth $300. So I waited, and it dropped to $30...
into the hobby. If there were speculators then at least some would put money
into moderns which are the hottest segment of the market. This market is ex-
tremely thin and even a little Wall Street money would have a dramatic effect.
There is no such thing being seen. At least in moderns it's just we collectors and
a few well heeled collectors. There is really little evidence of outside money coming
into any sector of the market. There are lots and lots of new and returning col-
lectors who we need to try to keep interested.
Nor is there indication that this is just another mass move by long time collectors
into a small sector which is too small. Some of the areas which are hottest are 20th
century coins which are popular with returning collectors and moderns which are
popular with newbies. Indeed, many old timers still have very little regard for moderns
and little more for the earlier 20th century coins.
This move is real.
---pay attention to what others are looking at, especially at shows. hot items that i've seen at the last few shows have been buffalo nickels, morgans-DUH, SLQ's, roosevelts and bust half dollars. i'll be at a show next weekend and maybe i'll take note of what seems to be most interesting to the masses.
---show attendance has been very good the last couple of years, also, even small local shows.
---enrollment at our local coin clubs continues to grow.
al h.
I didn't mean that the uptick in the market today is due to speculators. What I was trying to point out is that even in light of the added interest due to the State Quarter program I don't think the percentage of the population that ends up becoming long term collectors is going to change much. I think there is a fairly set mix of the population that finds collecting coins, whether for historical or aesthetic reason, an enjoyable pursuit. You may get a surge of interest every now and then but I think over the long run the percentage of the population that remain in the hobby isn't going to change very much.