What you are seeing is the final phase of an upward spike in the market. At some MAJOR show in the near future dealer to dealer trading will suddenly stumble because a major buyer perceives the top has been reached and stops buying. Suddenly this former buyer will be trying very hard to unload his inventory. The other dealers will notice and quickly try to do the same. Undercapitalization of so many dealers insures that will happen even if some of the players really don't want to sell.
Please not that I said MAJOR show. Forget your local dealer or Sunday bourse. The local's or the bourse dealers exist on the fringe of the market and really don't do much but react to what they have heard is happening elsewhere.
<< <i>I would call astute collectors the guys who ........ have plenty of cash to buy the right coins when they become available >>
They're called RICH astute collectors......
IF all the high end stuff is in fact flying back & forth between dealers, then it's quite obvious the dealers are the ones driving the prices up by creating their own demand. IF this is the case they will price material out of the hands of a large percentage of collectors & the "astute" collectors will be the ones buying at the top prices. Eventually that will come to an end & coin prices will tank. I get the feeling from some posts in this thread that the bubble may be about to burst. That's fine with me because I don't have an "astute" wallet!
Great transactions with oih82w8, JasonGaming, Moose1913.
" It's nice to know that when I pay what appears to be way too much that I am actually an astute collector"
and
"how does anyone really now when enough is to much in a "hot" market ?"
Good comment/question and related.....
In my opinion, there is no answer that is succinct and mathematically correct.
I always use "the gut" when paying serious money over respected price guides. (This is quite necessary when buying monster toned coins.)
Are you going to regret passing on the coin?
When was the last time you saw one? Have i ever seen one?
How much money is in the checking account?
Can i get a written buy back?
Will all of your coin friends be seriously jealous?
When i buy a coin (and i have been accused far more often of being stupidly 'generous' in what i pay as opposed to nigardly - and yes, i know i left out a g but i'm getting screened by the all knowing but incorrect word screening program), I try to take eye appeal into consideration, to put it mildly. I will pay a generous premium for a coin with great eye appeal and not even ask the price on a rare coin without eye appeal.
Also, the more expensive the coin, the less times sheet it ought to be. For example, i don't mind paying 30 times sheet for an 1881-S in PCGS MS 65 which sheets for less than a 100 bucks if the coin is a drop dead drool producing incredible monster, but paying 30 times sheet for a mind blowing Flowing Hair Dollar in XF 40 isn't gonna happen.
So, back to the issue of a hot market.
I'd be very careful about trusting any dealer. Do not rely solely on the advice they give you with regard to what the value of a piece is. "The sheets are way off" may be true but might not be.
If it's a semi-fungible good, get comparison prices - it's unlikely that all the dealers are in a conspiracy against you.
Check with other dealers about the value. Check auction prices realized.
If it's something that's incredibly rare, and you just can't live without it, well, you can't live without it. But try and remember that they're coins and people who are panic buyers generally regret buying that coin they thought they couldn't live without.
One final thought. I was offered a particular coin at $5000. I passed, thinking, wow, that is a fantastic coin but $5000 is too much money.
I saw it in a dealer's case this weekend. Still was a beautiful coin but i was still glad i didn't pay $5000 for it.
I think that helps. If it's a coin you can live without because of the price, do so. If it's a coin you're gonna regret owning, well, know that and act upon it.
In the end, it's really how much money do you have and want to spend on a coin? Whether or not someone else will belly up to the bar really shouldn't matter unless you're buying to resell. If your a collector, is it worth the money to you? Don't use somone else's value system - use your own.
Woe betide the average schmo collector, wanting to sell some of his lesser grade, more common date coins in order to get some cash to buy those gems that seem to be passing from dealer to dealer....you might get a fraction of bid.
I'm all for capitalism and a guy making a buck and covering his overhead...and I understand that dealers will pay good money for stuff that turns around quick and that they can put big dollar signs on...but I'm also frustrated for the guy who wants to unload a big box of dupes and taking pennies on the dollar
I'm not sure that I'd use the term 'astute' for educated wealthy collectors paying sky high prices for coins right now. Coin prices go in cycles and I think a lot of people paying silly money for coins these days may wish they hadn't a few years from now. In some ways, this market for certain coins reminds me of 1988-89, many thought that prices would continue to rise with no end in sight. I remember D. Hall once predicting back then that one day you wouldn't even be able to find an 1881-S Morgan in MS65 much less be able buy one............
I think the term astute would better describe those who were buying up really nice coins in the mid-90's when nobody cared and you sometimes couldn't give them away.
Al, that's what I've done. And I'm happier, too. No chasing things. I can get a collection of coins I appreciate, enjoy, and can learn from at a fraction of the cost. I mean, I love finding a raw 1938 jeff that's brilliant in MS-66 for $2. I actually enjoy that more than a MS-65 PCGS 1880-S Morgan dollar.
"Woe betide the average schmo collector, wanting to sell some of his lesser grade, more common date coins in order to get some cash to buy those gems that seem to be passing from dealer to dealer....you might get a fraction of bid."
Why on earth would you want to offer your coins to a dealer when you can put them up, one at a time to collectors on eBay?
Yes, it might take you 30 minutes to list each one, 20 to answer emails, 20 to pack them up, 10 more for returns and a little more work but hey, you'ld be getting market price.
Or better yet, reserve, pay for and get a table at a show. Get insurance. Lug the stuff to the show, make sure you're armed in transit, and attend enough shows until the average stuff (which i told you never to buy in the first place) is gone.
Dragon - the market goes up and down and being a market timer is pretty tough.
Your point is well taken and prices may collapse in the future. But in my opinion, the market has been too low for too long and i betcha prices we see for quite a bit of the best material will not be lower ever again. I bet Bust Dollars and early copper and the very best key date material is cheap now as compared to where it will be 3 years from now.
The fundamentals are there. Gold has been drifting upwards and it's not just the weak dollar in my opinion.
Anaconda...I know my point sounds like I'm throwing stones at dealers, and it isn't really my intent....I fully understand the need to pay for the service and cover overhead and turn a reasonable profit, combined with the inevitable fun (and pain ofttimes) of dealing with the public. This is why I would not want to be a dealer. I'm just frustrated..and sincerely apologize if I offended any sensitivities.
johnny - no offense was taken. I understand your pain as i've been there too.
In fact, here's a little story.
In 1991 i went out on my own after getting laid off along with 9 others at one of the best law firms in Dallas. Our largest client had fired us.
The beginning was really, really, tough. So tough that my car was repossessed. I got locked out of my apartment where i was living and practicing law.
My girlfriend (now wife) called me to tell me that my phone had been turned off. I had her take the only real asset i had left, a 1804 Half Cent in PCGS MS 65 to the largest dealer in Dallas and got their offer which didn't make me happy. I felt like i had been taken advantage of. And no, my wife was and is smart enough not to to say anything like "We're desperate....."
But i sold it and from there, things got better. Eventually i was actually able to get a car with air conditioning....and now all my cars have air conditioning.
Anyway, as the years have passed, I have come to realize that if i wanted to, i could advertise to buy coins and make offers and become one of those dealers that gets coins so cheap. And it's something i just never undertook because it just wasn't what i wanted to do. We all can open a shop or set up at shows and become the dealer we always thought we should be able to do business with.
Truth be told, being a coin dealer who buys average material and then sells it at a profit is a tough gig to pull off and certainly one that i wouldn't want to do.
<<< i betcha prices we see for quite a bit of the best material will not be lower ever again. >>>
I dunno Anaconda, 'ever' is a very long time. During every spike in coin prices about every 10-12 yrs. or so, people always adopt the mindset that this time is different and prices will never retreat from these levels. I remember being at the 1988 ANA show in Cincinnati (or was it 1989?) and seeing prices seemingly go through the roof in a white hot marketplace, with many dealers and collectors leveraging themselves to the hilt, only to see many coins worth about 10 cents on the dollar a few years later. While it's true that many of the biggest percentage losers were generic type material, many low pop. key dates and rarities also came way down in the following years. JMO
Reading this thread reminds me that coin collecting is an addiction and not an investment. If you doubt thid just change noun in many of these sentences from coins to stocks and then see if the statements make any sense. As an example how many of us would buy a stock with a 35% spread?
Dragon - I agree with everything you say. I don't think the market right now is white hot like it was in 1989.
David Q. Bowers made one of the best descriptions of historical coin prices: he said it was essentially like a saw blade on an upward angle - there are peaks and valleys but the really high peaks are usually higher than the last ones and the the lowest valleys are higher than the last really low valleys.
We'll see.
The most important thing is to keep coins in perspective and have a rational amount of money in the market. If you're old and grey, having all of your net worth dumped at one time into one area of the market is a very, very bad idea. Coins are not liquid and they are very volatile.
If you're a bust dollar collector (or whatever) who is 3/4 of the way done with the series and you are considering buying a $30,000 coin which was a $20,000 coin last year, you shouldn't worry too much especially if you've been collecting bust dollars for the past 15 years and you have a net worth of over one million (just to use general numbers.)
If you're new to coins and you're thinking about taking out a home equity loan to dump $75,000 into coins and you have $50,000 worth of credit card debt and you make $50,000 a year, i would advise against it.
Trime - coin collecting can be an addiction. No doubt about it. However, there are many coin folk who are married whose wives would say that their husbands are not coin addicts - and wouldn't they be the most likely to say that they were? I would say that it might be as high as 15% that are not addicts. (iwh)
The coin market has been and always will be a very thin market that is subject to major swings. I am viewing this primarily as an economist and not a collector. One of the interesting things about this forum is that the high end dealers and buyers are mixed in with the little guys who love coins but do not have the big dollars to play with.
There is a living to be made as a dealer of both small and large value coins, it is just a very different way of doing business. For me this topic is for the 1% who are the very deep pocket collectors. That is why we need to encourage all the YNs as much as possible. In 40 years if there are not the same number of individuals will a passion (and VERY deep pockets) for collecting, then everyone who inherits the high end collections will get a fraction of what it cost to build them. I am not predicting this, but it is one potential issue for a hobby that is primarily populated by old white guys (like me).
My question for the readers is "What is the Hepkitty seeing in terms of the movement of Frankies in terms of prices?" There are a large number of collectors who can afford this series and other similar ones who make up that market. I do not call this "modern" as that is what I save for any post 1964 coins. Like everyone else I get to pick my own definition of "modern". If we can answer what is going on there, perhaps we have a pulse on a larger segment of the market.
Retired United States Mint guy, now working on an Everyman Type Set.
As a higher end classic commem collector, and customer of yours (Iowa NGC 68 and others), Adrian ...... I've been slightly amazed that the classic commems have not also taken off like much of the coin market. There has been some real high end (make that all ends) values out there in the past six months to a year. This was the case at shows, over the Internet etc. Classic commems, now, are still where gold was, a year ago. Since I'm not planning to sell for a decade at least (ever, more likely), I'm not concerned.
However, I am just barely starting to detect this market starting to tighten up as the number of quality coins available is beginning to shrink. Still, I just bought a real nicely peach toned PCGS 66 Washington Carver with a strong strike for right around Bluesheet via auction. Six months ago, this kind of a find was able to be found regularly. Now, more and more work is being required to dig them out. The difference between finding one or two a week versus finding one every couple of months.
I'm interested on hearing everyone else's thoughts on the current classic commem market.
If you're a bust dollar collector (or whatever) who is 3/4 of the way done with the series and you are considering buying a $30,000 coin which was a $20,000 coin last year, you shouldn't worry too much especially if you've been collecting bust dollars for the past 15 years and you have a net worth of over one million
tc - i know that some dealers restrain themselves in increasing their bids on coins. I suspect that we will see substantial increases in classic commems within the next year.
I have been buying many nice commems in 65 - 67 that i can find that are priced within 10 percent or so (depending on the eye appeal) of grey sheet bid.
Comments
Then some of you dealers are SQUARES!
"Senorita HepKitty"
"I want a real cool Kitty from Hepcat City, to stay in step with me" - Bill Carter
Please not that I said MAJOR show. Forget your local dealer or Sunday bourse. The local's or the bourse dealers exist on the fringe of the market and really don't do much but react to what they have heard is happening elsewhere.
<< <i>I would call astute collectors the guys who ........ have plenty of cash to buy the right coins when they become available >>
They're called RICH astute collectors......
IF all the high end stuff is in fact flying back & forth between dealers, then it's quite obvious the dealers are the ones driving the prices up
by creating their own demand. IF this is the case they will price material out of the hands of a large percentage of collectors & the
"astute" collectors will be the ones buying at the top prices. Eventually that will come to an end & coin prices will tank. I get the feeling
from some posts in this thread that the bubble may be about to burst. That's fine with me because I don't have an "astute" wallet!
Great transactions with oih82w8, JasonGaming, Moose1913.
and
"how does anyone really now when enough is to much in a "hot" market ?"
Good comment/question and related.....
In my opinion, there is no answer that is succinct and mathematically correct.
I always use "the gut" when paying serious money over respected price guides. (This is quite necessary when buying monster toned coins.)
Are you going to regret passing on the coin?
When was the last time you saw one? Have i ever seen one?
How much money is in the checking account?
Can i get a written buy back?
Will all of your coin friends be seriously jealous?
When i buy a coin (and i have been accused far more often of being stupidly 'generous' in what i pay as opposed to nigardly - and yes, i know i left out a g but i'm getting screened by the all knowing but incorrect word screening program), I try to take eye appeal into consideration, to put it mildly. I will pay a generous premium for a coin with great eye appeal and not even ask the price on a rare coin without eye appeal.
Also, the more expensive the coin, the less times sheet it ought to be. For example, i don't mind paying 30 times sheet for an 1881-S in PCGS MS 65 which sheets for less than a 100 bucks if the coin is a drop dead drool producing incredible monster, but paying 30 times sheet for a mind blowing Flowing Hair Dollar in XF 40 isn't gonna happen.
So, back to the issue of a hot market.
I'd be very careful about trusting any dealer. Do not rely solely on the advice they give you with regard to what the value of a piece is. "The sheets are way off" may be true but might not be.
If it's a semi-fungible good, get comparison prices - it's unlikely that all the dealers are in a conspiracy against you.
Check with other dealers about the value. Check auction prices realized.
If it's something that's incredibly rare, and you just can't live without it, well, you can't live without it. But try and remember that they're coins and people who are panic buyers generally regret buying that coin they thought they couldn't live without.
I saw it in a dealer's case this weekend. Still was a beautiful coin but i was still glad i didn't pay $5000 for it.
I think that helps. If it's a coin you can live without because of the price, do so. If it's a coin you're gonna regret owning, well, know that and act upon it.
In the end, it's really how much money do you have and want to spend on a coin? Whether or not someone else will belly up to the bar really shouldn't matter unless you're buying to resell. If your a collector, is it worth the money to you? Don't use somone else's value system - use your own.
adrian
I'm all for capitalism and a guy making a buck and covering his overhead...and I understand that dealers will pay good money for stuff that turns around quick and that they can put big dollar signs on...but I'm also frustrated for the guy who wants to unload a big box of dupes and taking pennies on the dollar
I think the term astute would better describe those who were buying up really nice coins in the mid-90's when nobody cared and you sometimes couldn't give them away.
dragon
Why on earth would you want to offer your coins to a dealer when you can put them up, one at a time to collectors on eBay?
Yes, it might take you 30 minutes to list each one, 20 to answer emails, 20 to pack them up, 10 more for returns and a little more work but hey, you'ld be getting market price.
Or better yet, reserve, pay for and get a table at a show. Get insurance. Lug the stuff to the show, make sure you're armed in transit, and attend enough shows until the average stuff (which i told you never to buy in the first place) is gone.
Just a few thoughts.
Your point is well taken and prices may collapse in the future. But in my opinion, the market has been too low for too long and i betcha prices we see for quite a bit of the best material will not be lower ever again. I bet Bust Dollars and early copper and the very best key date material is cheap now as compared to where it will be 3 years from now.
The fundamentals are there. Gold has been drifting upwards and it's not just the weak dollar in my opinion.
I'm just frustrated..and sincerely apologize if I offended any sensitivities.
In fact, here's a little story.
In 1991 i went out on my own after getting laid off along with 9 others at one of the best law firms in Dallas. Our largest client had fired us.
The beginning was really, really, tough. So tough that my car was repossessed. I got locked out of my apartment where i was living and practicing law.
My girlfriend (now wife) called me to tell me that my phone had been turned off. I had her take the only real asset i had left, a 1804 Half Cent in PCGS MS 65 to the largest dealer in Dallas and got their offer which didn't make me happy. I felt like i had been taken advantage of. And no, my wife was and is smart enough not to to say anything like "We're desperate....."
But i sold it and from there, things got better. Eventually i was actually able to get a car with air conditioning....and now all my cars have air conditioning.
Anyway, as the years have passed, I have come to realize that if i wanted to, i could advertise to buy coins and make offers and become one of those dealers that gets coins so cheap. And it's something i just never undertook because it just wasn't what i wanted to do. We all can open a shop or set up at shows and become the dealer we always thought we should be able to do business with.
Truth be told, being a coin dealer who buys average material and then sells it at a profit is a tough gig to pull off and certainly one that i wouldn't want to do.
I dunno Anaconda, 'ever' is a very long time. During every spike in coin prices about every 10-12 yrs. or so, people always adopt the mindset that this time is different and prices will never retreat from these levels. I remember being at the 1988 ANA show in Cincinnati (or was it 1989?) and seeing prices seemingly go through the roof in a white hot marketplace, with many dealers and collectors leveraging themselves to the hilt, only to see many coins worth about 10 cents on the dollar a few years later. While it's true that many of the biggest percentage losers were generic type material, many low pop. key dates and rarities also came way down in the following years. JMO
dragon
If you doubt thid just change noun in many of these sentences from coins to stocks and then see if the statements make any sense.
As an example how many of us would buy a stock with a 35% spread?
David Q. Bowers made one of the best descriptions of historical coin prices: he said it was essentially like a saw blade on an upward angle - there are peaks and valleys but the really high peaks are usually higher than the last ones and the the lowest valleys are higher than the last really low valleys.
We'll see.
The most important thing is to keep coins in perspective and have a rational amount of money in the market. If you're old and grey, having all of your net worth dumped at one time into one area of the market is a very, very bad idea. Coins are not liquid and they are very volatile.
If you're a bust dollar collector (or whatever) who is 3/4 of the way done with the series and you are considering buying a $30,000 coin which was a $20,000 coin last year, you shouldn't worry too much especially if you've been collecting bust dollars for the past 15 years and you have a net worth of over one million (just to use general numbers.)
If you're new to coins and you're thinking about taking out a home equity loan to dump $75,000 into coins and you have $50,000 worth of credit card debt and you make $50,000 a year, i would advise against it.
Trime - coin collecting can be an addiction. No doubt about it. However, there are many coin folk who are married whose wives would say that their husbands are not coin addicts - and wouldn't they be the most likely to say that they were? I would say that it might be as high as 15% that are not addicts. (iwh)
adrian
There is a living to be made as a dealer of both small and large value coins, it is just a very different way of doing business. For me this topic is for the 1% who are the very deep pocket collectors. That is why we need to encourage all the YNs as much as possible. In 40 years if there are not the same number of individuals will a passion (and VERY deep pockets) for collecting, then everyone who inherits the high end collections will get a fraction of what it cost to build them. I am not predicting this, but it is one potential issue for a hobby that is primarily populated by old white guys (like me).
My question for the readers is "What is the Hepkitty seeing in terms of the movement of Frankies in terms of prices?" There are a large number of collectors who can afford this series and other similar ones who make up that market. I do not call this "modern" as that is what I save for any post 1964 coins. Like everyone else I get to pick my own definition of "modern". If we can answer what is going on there, perhaps we have a pulse on a larger segment of the market.
However, I am just barely starting to detect this market starting to tighten up as the number of quality coins available is beginning to shrink. Still, I just bought a real nicely peach toned PCGS 66 Washington Carver with a strong strike for right around Bluesheet via auction. Six months ago, this kind of a find was able to be found regularly. Now, more and more work is being required to dig them out. The difference between finding one or two a week versus finding one every couple of months.
I'm interested on hearing everyone else's thoughts on the current classic commem market.
That is about as bad as selling a 60 dollar morgan for over 2,000 dollars because it's pretty!
NEVER LET HIPPO MOUTH OVERLOAD HUMMINGBIRD BUTT!!!
WORK HARDER!!!!
Millions on WELFARE depend on you!
I have been buying many nice commems in 65 - 67 that i can find that are priced within 10 percent or so (depending on the eye appeal) of grey sheet bid.