The Inherent Danger of Overeager Collectors and Modern Coinage.
keets
Posts: 25,351 ✭✭✭✭✭
First, the data from my files and then the comment from me and hopefully the forum. The following is from my files of eBay sales for a single date of Jefferson Nickel, 1991-P, in PCGS MS66FS. For the sake of discussion and since the coins were all purchased sight unseen, let's just assume that each was properly graded. I keep the insert number when available so it's safe to assume that each represents a different coin and not a resale.
The first column is the purchase price followed by the date in the second column and my best estimate from PCGS Pop Reports of the number in grade at the time of sale.
$306.00----------1/27/01----------none listed in the January 2001 report. This could possibly be the first.
$169.50----------3/16/03----------14 as 1/30/03.
$223.5------------5/25/03----------15 as of 4/1/03.
$218.49----------10/3/03----------no data but reliable estimate would be approximately 20.
$103.50----------2/1/04------------current pop is 25.
$140.88----------2/8/04------------current pop is 25.
$88----------------2/15/04----------current pop is 25.
$85----------------2/26/04----------current pop is 25.
I would like to add that the last auction was a listing by one of the "market makers" and was a group of five coins which were sniped at three seconds with a purchase of two.
My comment----I think there is much truth in the warnings we hear about spending too much on low pop moderns just to be "the first on the block" to have the coin. Without divulging any identities, I can safely say I know who several of the buyers of the early coins are in the Registry. I guess it's nice that they were willing to pay the long dollar to get the search on for more coins, I just wonder how they feel about their price paid for the cherished Pedigree. Also, this single date study should highlight the fact that issues hyped as rare/scarce aren't really rare or scarce. Unsearched for as yet, maybe. Undiscovered as yet by a lax hobby, maybe. But rare/scarce, very, very doubtful.
I'm certain a diligent collector could uncover similar dates in his/her area of collecting. This is certainly not an element of the Jefferson series alone, perhaps it's just a symptom of the Modern collector attitude at it's worst------a willingness to believe the Hype, a drive to be the best. Personally, my choice is to allow prices to drop while pop's grow on some of the more difficult dates in my area of endeavor. I continue to search for coins and submit the gems I find to fill my set. I buy when prices become sane.
My reason for choosing this date is a result of the last sale. I perceive that the issue is far more common than beleived by many, a reflection of the last seller choosing to auction five coins at once instead of selling them individually. I imagine the numbers will grow for this and other Jefferson Nickels in the MS66FS grade. I'll enjoy the scramble.
Any comment, perhaps about your series?? Thanks for your indulgence.
Al H.
The first column is the purchase price followed by the date in the second column and my best estimate from PCGS Pop Reports of the number in grade at the time of sale.
$306.00----------1/27/01----------none listed in the January 2001 report. This could possibly be the first.
$169.50----------3/16/03----------14 as 1/30/03.
$223.5------------5/25/03----------15 as of 4/1/03.
$218.49----------10/3/03----------no data but reliable estimate would be approximately 20.
$103.50----------2/1/04------------current pop is 25.
$140.88----------2/8/04------------current pop is 25.
$88----------------2/15/04----------current pop is 25.
$85----------------2/26/04----------current pop is 25.
I would like to add that the last auction was a listing by one of the "market makers" and was a group of five coins which were sniped at three seconds with a purchase of two.
My comment----I think there is much truth in the warnings we hear about spending too much on low pop moderns just to be "the first on the block" to have the coin. Without divulging any identities, I can safely say I know who several of the buyers of the early coins are in the Registry. I guess it's nice that they were willing to pay the long dollar to get the search on for more coins, I just wonder how they feel about their price paid for the cherished Pedigree. Also, this single date study should highlight the fact that issues hyped as rare/scarce aren't really rare or scarce. Unsearched for as yet, maybe. Undiscovered as yet by a lax hobby, maybe. But rare/scarce, very, very doubtful.
I'm certain a diligent collector could uncover similar dates in his/her area of collecting. This is certainly not an element of the Jefferson series alone, perhaps it's just a symptom of the Modern collector attitude at it's worst------a willingness to believe the Hype, a drive to be the best. Personally, my choice is to allow prices to drop while pop's grow on some of the more difficult dates in my area of endeavor. I continue to search for coins and submit the gems I find to fill my set. I buy when prices become sane.
My reason for choosing this date is a result of the last sale. I perceive that the issue is far more common than beleived by many, a reflection of the last seller choosing to auction five coins at once instead of selling them individually. I imagine the numbers will grow for this and other Jefferson Nickels in the MS66FS grade. I'll enjoy the scramble.
Any comment, perhaps about your series?? Thanks for your indulgence.
Al H.
0
Comments
In the "What will keep it's value post" some days back, I said that low pop moderns were really risky and one of the first to lose value... your research proves that for that particular coin anyway....
What's the true cut-off for moderns? I'm not sure... I would say a modern is a coin you can still cherrypick say.... out of a proof set.... mint set..... in change.... maybe go to the bank and get one..... available at the mint..... so.... 1950 to now ?.
As far as my series, the Peace $, I don't see any issues.... pop's rise because people resubmit coins which have a wide spread between grades.....
one peculiarity about Peace Dollars is that while they had low mintages in general with the exception of a few dates, they also suffered at the hands of the melting pot. coupled with a low relief design, that all adds up to a low survivor rate for gem coins. i think a lot of collectors overlook that.
al h.
another date, 1991-D in PCGS MS66FS was once considered even more difficult than it's Philadelphia counterpart. the graded pop as of 1/30/02 was a big fat ZERO and had moved to six a year later. it currently stands at 19 in grade.
my feeling with all this is that these coins are being found and introduced ala slab to the collecting community slowly, perhaps even held in groups by some till the price drops to a level which precludes the big killing. then they come out of hiding, maybe in groups of five, 'eh??
the trick is to avoid the web as it is being spun.
al h.
Good observation and enjoy your coins.....
NO STEPPERS
I recently bought (5) coins at $75/coin "wholesale". I sold (3) of them already for probably less than $85/coin net (after ebay listing/selling fees/paypal fees). Bottom line is I am trying to make a "2-way market" in many modern MS coins (of course, it is limited by the very size of my business) and this is how you have to do it.
But, IMHO, here is where your thread heading is subject to debate:
ebay # 2210953782: 1999(d) NEW JERSEY STATE QUARTER GRADING PCGS-MS67 - ENDING DATE 12/14/03
LISTED AT $199 AND SOLD FOR $233.16 AND OFFERED BY THE #2 SET OWNER IN THE COUNTRY - A VERY SOPHISTACATED SELLER WITH VAST KNOWLEDGE OF THE SERIES AND A GREAT FEEL FOR THE DIRECTION THE COINS MAY HEAD. Further, every state quarter buyer in the country decided back in 12/03 that the coin was worth no more than $233.16. Now, just (2) months later, that same coin would likely sell on ebay for nearly $600 - approaching a 300% rise in less than 75 days!!
I could write examples ALL DAY LONG HERE ON THIS THREAD of MS moderns rising in price over the past 60-90 even with rising pops to go along with it (REPEAT- THE NJ(d) STATE QUARTER EXAMPLE IS NOT AN ISOLATED ABERRATION OF WHAT MANY MODERN COINS HAVE DONE OVER THE PAST 60-90 DAYS IN MANY SERIES). My simple point is the modern market rises and drops on a daily basis and to suggest that the "inherent danger of overeager collectors" is to lose 3/4 of their money, while not, at least pointing out that by the same token other MS moderns has risen upwards of 200%-300% in the same short periods of time as well is a disingenuous analysis of the market IMHO.
That said, I agree with the concept that we often see overeager collectors pursuing BOTH modern and classic coinage.
Wondercoin
The 1903-O Morgan used to be low pop and few collectors had one and no dealers had any and it was the most sought after and most expensive Morgan in the series. They were really hyped, the Holy Grail of Morgs.
It used to sell for $1,500 in BU back in the early 1960s. Then they became more available & the pop increased and like a lead balloon they went DOWN to $30. When they market went crazy back in 89 they went up to $300. Then they dropped to $100 when it went south in 95. Look at them now, thanks to market making dealers manipulating the market and hyping them and the advent of the internet they and not to mention the PCGS Set Registry they have gradually leveled out @ $200 here 40 years later.
Think of all the dealers, investors & overeager collectors that paid thousands of dollars for a BU 03-O, which was a Modern coin back in those days, and almost overnight their investment disappeared. Grandparents didn’t have any inheritance left for their children & dealers were begging in the streets.
Ouch ooooh ah ohhhh that hurt!
Any idiot should have seen that coming because after all, the mintage was 4½ million.
Beware the Classic Morgans because you’ll get burned.
I was an overeager Modern collector back in 1997 & 98 & paid $300 for $5 JRob Commems which was stupid at the time because Mint products were duds, and especially being PopTop PCGS Moderns, NGC wouldn't even touch them, but what the L, the pops were low & the mintage was only 5,000. The pops went up up up and so did the price now I see offers to buy @ $1,500. PCGS price guide says $2,150.
You can get rich quick fooling with Moderns.
well said indeed...
guess hype costs
Go BIG or GO HOME. ©Bill
A point not even in contention, as I clearly stated I would personally like to try to develop a 2-way market in some of the coins I deal in on a regular basis. I know of very few dealers out there right now that will step up and buy (10) of this and (8) of that same date, etc, in the modern MS Jeff series. Obviously, such purchases are filled with risk, especially the risk that pops might skyrocket on a particular date and one could lose 3/4 of their money as Al clearly demonstrated. On the other hand, modern coins can (and do) double in price very quickly at times (as I demonstrated with just one example of a recent ebay sale on a very popular state quarter).
Wondercoin
Dog - This is an unfair example, because that was TOO EASY to figure at $300/coin!!
Wondercoin
What's the true cut-off for moderns? I'm not sure... I would say a modern is a coin you can still cherrypick say.... out of a proof set.... mint set..... in change.... maybe go to the bank and get one..... available at the mint..... so.... 1950 to now ?.
Peaceman,
I have no intention to change anyone's mind about moderns, and frankly I probably shouldn't post to this thread as doing so usually results in more competition for the coins I like, but here goes. Keets point is valid. There is always a premium charged for a given date until the price justifies submitters moving coins to those holders. It is a natural thing. Once the population is revealed and the initial demand satiated, the price drops. Moderns are usually lumped into one group, and I noticed you were astute enough to say "that particular coin". Smart use of a qualifier, and I think you're on the right track. Keets post speaks to coins that whose populations have not been thoroughly revealed. It does not speak to every coin minted since 1950. There are certain coins in that group that have held a 4 or 5 figure bounty for years, and yet the populations have not exploded, nor the prices dropped. Coins that immediately come to mind are Dcam 65 SMS coins, 1950 Dcam Washingtons, 1972-P Gem+ Ikes, etc,etc. For those coins, Keets post is not applicable.
Keets is an observant collector, and he knows which coins I speak of. I realize that was not the point of his post, but before we drift into sweeping generalizations, I thought I'd at least share what I've spent a long time learning.
Cladking can speak for himself, but I count him as a friend, and appreciate his input. I think anyone genuinely interested in these coins owes it to themselves to do just as Keets has done, and actually do a little good research. Does anyone here believe CK hasn't done his.
and it sets us apart from practitioners and consultants. Gregor
you aren't trying to goad me into submitting some coins for your set, are you??
hey Mitch
acknowledged, it happens both ways, but my perception and observation shows me that declining prices over time is the norm as a population in a certain grade/issue rises. your comparison of rising prices over the past 60-90 days will be better used for analysis in 2006 when i feel confident that the price on the 1999(d) NEW JERSEY STATE QUARTER GRADING PCGS-MS67 will have dropped. better yet, can you provide a price for that issue when it first appeared as an MS67 PCGS and perhaps a few sales figures from then to now?? i assume it was probably between $1000-$2000 initially and lowered as the number in grade rose.
i know for a fact that with some Modern issues, eagerness to have the first in grade coin, such as an MS69, can result in financial disaster when others are made in quick succession beyond the buyers control. the fall in price can result in a large drop in value. perhaps not much to a dealer who is flipping stock quickly, but to an overeager collector......................patience is always a better tool.
al h.
<< <i>I think there is much truth in the warnings we hear about spending too much on low pop moderns just to be "the first on the block" to have the coin >>
of course your assuming that "spending too much" means not getting enough back on your return. for some collectors, there is added value for gettin something "1st", or "highest graded", etc. what i'm saying is that for some of the buyers you allude to, financial loss may have been offset, or even superseded, by a quantity of personal satisfaction.
example, i have overspent on coins before that i know will be losers when i sell them. that's ok w/ me, because the financial loss is more than made up for by having enjoyed the coin.
probably not possible to quantify it, but it is a dimension of collecting and enjoying coins that is all to easily ignored, when you measure "success" as a buyer by financial terms alone.
K S
The percentage of unslabbed moder coins that who grade high is alot larger then the percentage of unslabbed classics that would grade high.
It doesn't mean they are not out there for any and all dates, there is just a lot more high grade moderns
My posts viewed
since 8/1/6
And, I acknowledge that a thread entitled "THE INCREDIBLE ENJOYMENT OF WATCHING YOUR MODERN COINS DOUBLE IN PRICE IN 60 DAYS" would be met with 10x the resistence of your well researched analysis pertaining to 1991 nickels
Wondercoin
P.S. I knew I should have offered $300 for the 5 1991(p) nickels in MS66FS and not $375!!!
the difference i see between Moderns and Classics here is that as a general rule we know that the Moderns exist, while the Classics, as explained by dog97, are sprung on an unsuspecting hobby. i see that unfolding now with the recent shipwreck hoard closing in on a release date. i wouldn't want to be a gold collector from that era, to nerve wracking from both positive and negative sides of the equation.
al h.
I enjoy attributing VAM's and I am often tempted to pay extra for Top 100's attributed by someone else, but I wonder just how risky it is to pay premiums for otherwise common date Morgans. A little like high grade moderns, IMO.
indefinitely would be well advised to put their money elsewhere because it will remain dynamic and
fluid until the collectors in these coins become more familiar with what coins are available and the
demand becomes more static. Those who want to deal, invest, or even collect in these markets are
best off if they actually get out and look at a lot of coins. It's simple enough to merely pick up a hand-
full of 1991 mint sets and get a feel for what these coins look like. Yes, there are some nickel rolls
out there and you'll have to look at many of these to have a feel for them but generally the best coins
do appear in the sets, so understanding them will get you a long way to understanding the number
of choice and gem coins available. With the dimes and quarters the rolls are of little importance since
thay are quite scarce and rarely contain any choice or gem coins. In all probability there are literally
no gem dimes or quarters in bags or rolls for some dates.
Once you've done some homework, you can have much more appreciation for the meaning of the num-
bers in the pop reports. This isn't to say that small numbers will necessarily stay small or large ones
will grow much larger, but if your experience tells you a coin is tough in high grade and the pop report
shows few graded then don't expect the coins to come out of the woodwork. If a coin appears gemmy
in a set (like the '91-D) then don't be surprised if the price doesn't increase as the pops increase. As
small as the modern markets are, they are already much bigger than a mere "25" coins for this date.
Many collectors are happy with the raw coin they found in a set and feel no compulsion to go out and
buy a graded gem. There are many thousands of people with raw sets and many despite seeking qual-
ity are happy enough with just a nice looking coin or a raw gem. Part of the demand for the scarcer coins
is coming from those completing such sets and simply can't locate a coin of sufficient quality for their set.
This has been said before but the day is fast approaching where the supply of raw coins will be exhausted.
There were a finite number of mint sets produced and their populations were greatly reduced even before
people began collecting these coins. At some point there will simply not be enough sets coming on the
market to satisfy the growing demand. At that time the pops will begin growing for the lower tier coins
and the prices will respond sharply to any further increases in demand.
I'm guessing that the market will grow to the point that 25 coins appears quite rare and that it will begin soon.
<< <i>The percentage of unslabbed moder coins that who grade high is alot larger then the percentage of unslabbed classics that would grade high.
It doesn't mean they are not out there for any and all dates, there is just a lot more high grade moderns >>
This simply is not true. While most moderns do look alike and are cookie cutter images
of one another, they often are all uniformly awful. Look at '75mint set, philly Ikes or '68-S nickels or
'89-D quarters until you grow weary and you will not find superb gems. There are limited
numbers of such coins to check and only the tiniest percentages will be gem.
Obviously there are classics which are equally impossible in gem but typically this is be-
cause of circulation or preservation or a tiny population rather than poor production.
It may well be true for most proofs and most commems but it is not for most circulating coins.
Edited-OK, try the '76 type I Ikes (in my defense they were all minted in 1975)
I can't even find any - mine are all dated 1974 or 1976!!
Wondercoin
<< <i>....
What's the true cut-off for moderns? I'm not sure... I would say a modern is a coin you can still cherrypick say.... out of a proof set.... mint set..... in change.... maybe go to the bank and get one..... available at the mint..... so.... 1950 to now ?.
>>
Except for cents it is virtually impossible to obtain any gem coins in circulation more than six years old.
To some extent, you may be correct, as many submitters submit piles of junk they believe to be high grade MS moderns, only to later learn they pis-ed away hundreds of dollars in grading fees for nothing.
Cladking- can you imagine the luck you would have pulling coins worth more than your grading fees when your strategy is to simply submit whole Mint sets and allow the 10-20 coins per set to be slabbed at $12/coin. Don't think it doesn't happen - possibly nearly every grading day!!
Wondercoin
<< <i>"I cant help but think the search for those low pop moderns is the root cause of PCGS's being so back logged on the economy submissions! Not quite what this thread is about, but at least related to it I think."
To some extent, you may be correct, as many submitters submit piles of junk they believe to be high grade MS moderns, only to later learn they pis-ed away hundreds of dollars in grading fees for nothing.
Cladking- can you imagine the luck you would have pulling coins worth more than your grading fees when your strategy is to simply submit whole Mint sets and allow the 10-20 coins per set to be slabbed at $12/coin. Don't think it doesn't happen - possibly nearly every grading day!!
Wondercoin >>
Most mint sets will contain at least one gem but it's usually a very common one and two cuts
below what it would take to warrant slabbing. Such a strategy would pay off on about one set
in a few hundred and would not nearly be enough to pay the fees for all the losers.
I can relate to what keets is saying but the only year I'm familiar with is 1997, not the Modern Market as a whole.
When I started if I wanted slabbed 97 coins I had to slab them myself. Interest amongst other collectors started rising and a new higher grade would come on the market & I would snag it. They were cheap at first then avery year or so new poptops would be made and I would have to be the <<<"the first on the block" to have the coin.>>> They cost more each time I upgraded and what I paid a prem for the year before all of a sudden was common and lost a lot of value. Sometimes they were in strong hands, mostly the Reg Set guys had them and instead of letting them shake me down I'd just wait and a few more would be made and what they were trying to sell me for $1,000 would be $500 in a year or so them around $300 & $200 then I'd snag it.
The 1997 P 25¢ in MS67 is a good example. Now there's a new generation of grades again in MS68 but they are so expensive and far between I no longer try to acquire them and have leveled off at MS67 in the biz strikes in all the denominations. The Jefferson nickel has me stuck @ MS66FS.
JFKs from 97 in MS67 seemed to have remained stable & even increased even with pop increases and the handful of MS68s made. Sold for $30-$40 in 1999. Ran about $50-$70 last year & around $170 this year so far.
Like keets I keep records prices realized & my research shows a similiar pattern. Take the quarters for example:
PRICES ON 1997-P 25¢ IN MS67
Quarter 1997P PCGS 67 • pop 3
Auction 1584 • Lot 1379
Wednesday, June 12, 2002
$800
*************************************************
Auction 1600 • Lot 1304 • pop 3
Monday, July 22, 2002
$750
*************************************************
Auction 1607 • Lot 1430 •
Wednesday, August 7, 2002
$500
*************************************************
1997-P Washington Quarter PCGS MS-67 pop 6
Item # 3011131947
$507.07
Mar-07-03
*************************************************
1997 P WASHINGTON 25c PCGS MS 67 POP 8/
Item # 3020251725
$550.00
May-01-03
*************************************************
1997 P WASHINGTON "PCGS MS 67" POP TOP FINEST pop 13/0
Item number: 2197342408
Oct-26-03 17:45:25 PST
Price: US $649.00
************************************************
1997 P WASHINGTON QUARTER "PCGS MS 67" pop14/0
Item number: 2205163129
Nov-30-03 20:30:00 PST
$400.00
***********************************************
1997 P WASHINGTON "PCGS MS 67" POP 14-00--
Item number: 2215056955
$227.50
Jan-11-04 19:21:16 PST
**************************************************************************************************
PRICES FOR 1997-D MS-67 QUARTERS IN MS67
1286:1496
Mar 22, 2000 1997D PCGS 67
$190
*********************************
1306:1361
May 10, 2000 1997D PCGS 67
$230
*********************************
1363:1263
Oct 2, 2000 1997D PCGS 67
$180
*********************************
1427:1545
Apr 16, 2001 1997D PCGS 67
$170
*********************************
1997-D Washington Qtr PCGS MS-67
Item 1280529373
Oct-07-01
$247.50
*******************************
1500:1381
Oct 29, 2001 1997D PCGS 67
$150
*******************************
1542:1366
Feb 20, 2002 1997D PCGS 67
$190
******************************
$50.55
Feb-24-02
******************************
Auction 1555 • Lot 1439 •
Monday, March 25, 2002
Quarter 1997D PCGS 67
$230
*****************************
1568:1253
May 1, 2002 1997D PCGS 67
$120
*****************************
1570:1331
May 8, 2002 1997D PCGS 67
$230
*****************************
1647:1484
Nov 11, 2002 1997D PCGS 67
$90
*****************************
1701:1296
Mar 24, 2003 1997D PCGS 67
$130
*****************************
1705:1397
Apr 2, 2003 1997D PCGS 67
$120
*****************************
1997-D Washington PCGS MS-67
Item # 3021340367
May-04-03
$85.00
***************************
1727:1379
May 21, 2003 1997D PCGS 67
$140
******************************
If, and when PCGS enters the global 1932-1998 Wash Quarter MS Registry set (and I hope it is soon), does anyone think pop 14/0 clad quarters will be $225 coins? The series will finally get the respect it deserves at that point.
Wondercoin
Cruising eBay. Come across a less-than-hour-old David Hall Rare Coins listing for a 1975-S PR-69 DCAM with a $99 BIN. Strikes me as a great buy. Do a little price research and the coin has consistently gone for $170 to $230 during the past year. Consult the 2-day-old PCGS Jeff pop report saved to my hard drive. An 82/0 coin, nine more than an older pop report (73/0) from March 5 showed. I BIN the coin.
Being the impatient type, I immediately add the cert number to my set to upgrade the coin. The pop shows 173/0. What's up here? I go to the pop report and it indeed lists 173 coins. It can't be ... a coin goes from 82/0 to 173/0 in two days, essentially overnight? I check the cert numbers around the coin I just purchased. It shows it is among nine 1975-S Jeffs graded consecutively, all receiving PR-69-DCAM. The nine coins added to the previous March 5 pop (73) indeed would increase the pop to 82 as shown two days ago ...
Did someone make 91 1975-S 69 DCAMs in the last two days? Is that why DHRC seemed to have a bargain BIN on this coin? Can this be a pop report mistake? The 68 DCAM pop for the date only increased one. If someone did have a huge, high-grade hoard, you would think more than one of 100 coins would tick down to 68. Have you ever heard a top pop modern doubling overnight? If it did, I have learned a big lesson: Never trust a 2-day-old pop report on the assumption a coin cannot gain huge numbers very quick ... Anyone else have a clue?
Curious, I asked David Hall to check out the situation. Here is his April 17 response:
Two days ago RGL posted a thread asking about the sudden jump in the Pop of 1975-S Jeffs PR69DCAM from 82/0 to 173/0. The dealer who made the coins called me and said the jump was correct and he had made the coins.
This can happen with some of the modern issues. It is not unusual for a dealer to submitt 200, 300, even 500 or more of the same issue. There will be occasional times when Pops jump, even double.
David
The 1975-S PR-69 DCAM Jeff today is a $20-25 399/0 coin ...
The Ludlow Brilliant Collection (1938-64)
Wondercoin
The Ludlow Brilliant Collection (1938-64)
proofs, so I don't mean to run down the importance of this task. But it should be remembered
the proofs were made and survive in much higher numbers than most of the business strike
gems. There will never be someone submitting a hundred '91-D nickel pop tops or probably
not even a dozen. This likely will apply to ALL modern business strikes more than a few years
old with the possible exception of cents.
Certainly Keets point stands though that it is not wise to be an overeager collector of moderns.