A question was asked via PM, and this really is the point I've been trying to make - do these dealers selling the overpriced common gold advertise in any of the coin periodicals? As far as I can tell, the answer is no, and it is really telling.
To me the markets are totally different in that coins are a bad investment.
That's not true. Sure, some other markets offer lower transaction costs and are more "transparent". Sure, some other investments generate cash flow and exponential capital growth. Sure, an intelligent investor will in the long run probably do better in other areas than in coins. But coins have a long history of price appreciation and the future is every bit as promising, if not more so.
In other words, coins are an OK investment and a GREAT hobby.
Andy Lustig
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
do these dealers selling the overpriced common gold advertise in any of the coin periodicals? As far as I can tell, the answer is no, and it is really telling.
Eric - What does it tell you?
Andy Lustig
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
<< <i>In other words, coins are an OK investment and a GREAT hobby. >>
I've never considered coins an "investment" per se.
But I do recognize desirable and scarce (relative to historical demand) coins as a store of value, and I have little problem justifying some coin purchases with our savings, recognizing it as a form of diversifying household net worth as compared to plowing all of our savings in the stock market and such. (The total market value of my coins still only represents less than 5% of what we have set aside in retirement accounts for investing, so it's not like I'm putting the future at risk if we have a 1989-style meltdown.)
So while I don't track coins like investments -- and I don't consider them investments per se -- it's nice to know that there's something I enjoy which, in the long run, will probably hold its value if not make a little money if I needed to sell. (Of course, if you aren't knowledgeable and let yourself get ripped off, that might not apply.) But it's nice to have a hobby which, in the long run, can MAKE you money instead of COSTING lots of it.
<< <i> But coins have a long history of price appreciation and the future is every bit as promising, if not more so. >>
Investments based on "price appreciation" alone (along with the other things I mentioned) are terrible investments, IMO. It is a TERRIFIC hobby however and there we agree.
jom
EDITED: Just to add. It might be a good "hedge" like gold is. Maybe there was can agree to an "OK investment" grade for coins.
<< <i>do these dealers selling the overpriced common gold advertise in any of the coin periodicals? As far as I can tell, the answer is no, and it is really telling.
Eric - What does it tell you? >>
Andy, you know exactly what it says. Please stop trying to get me to post things you can legally threaten me with.
A formal complaint against one of these dealers is being filed with the Texas AG on Monday. And with that, I'm through here.
<<"To me the markets are totally different in that coins are a bad investment.">>
Some are; many are not. In fact any coin that can be sold for MORE than you paid for it is a good investment in my book. More folks have probly lost their ass in the stock market than likely have ever lost it in coins.
<< <i>In fact any coin that can be sold for MORE than you paid for it is a good investment in my book. More folks have probly lost their ass in the stock market than likely have ever lost it in coins. >>
Probably so, but most of those who lost their butts in the stock market were either short-term market timers or didn't diversify their stock investments. Folks who were both long-term and diversified in their stock investments have definitely not lost their butts.
Besides, if I buy a coin 10 years ago for $900 and sell it today for $1000, is that a good investment? I think not, despite selling it for more than I paid for it; in terms of inflation I've lost money, and I could have made a better return by sticking the $900 in a regular savings account.
Having said that, again, I recognize nice coins with appreciation potential as a "hedge" or a way to diversify net worth...but I don't really think they are "investments" in the true sense of the word, and as I said before in this thread, any dealer that sells or hypes coins primarily from the "investment" angle deserves to be subject to similar scrutiny and disclosure requirements as securities dealers and brokers.
<< <i>If we can refer to a college education as an investment...
If we can refer to the purchase of a home as an investment...
Then we can certainly refer to our coin collections as investments.
Doesn't mean coins, or homes, or diplomas should be equated with stocks and bonds.
Just that the word "investment" has a broader meaning than some of us would like. >>
I was pitched by the salesman on a new 560SL a few years back how much of an "investment" it was and not just a car. I was in my show off period and bought it. Lost 30K when I dumped it ( was a piece of crap).
Bad "investment".
Now I drive a Jeep. It's a good investment vehicle particulary when needing to drive up those vertical roads around Asheville NC!
Andy, you know exactly what it says. Please stop trying to get me to post things you can legally threaten me with.
Eric - I have never threatened you and have no plans to do so. Nor do I have any interest in defending most of the people that you think I'm defending. The fact that I often disagree with you on some things you say does not mean that I disagree with you in spirit. In fact, I'm sure your heart is in the right place. You just get carried away. That said, I think you were trying to state the obvious: sellers that price their goods in an uncompetitive manner prefer to target unknowledgeable buyers. I agree. However, the fact that a seller does not offer highly competitive prices does not mean that he is guilty of fraud.
Andy Lustig
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
I truly do not know how the industry could be "regulated"? Do we force PCGS, NGC, ANACS and the other services to agree on every grade? Do we force the industry to create a grading machine that is perfect and sums up technical grade, eye appeal, luster, strike into one indisputable grade? Do we force buyers and sellers to stick to some arbitrary pricing matrix based on god knows what? If there should be any intervention at all, it should be in accordance with any other business and how the law relates to any deceptive practice or fraud (someone selling a fake gold coin and knowing it is fake).
Numismatics is big business because there are hundreds of millions of coins to collect and tens of thousands of interested collectors. Swap meets are also big business all over America, but why isn't the goverment stepping in and forcing the vendors at swap meets to sell their art, beads, jewelry, paintings, crafts, pottery, and general do-dads at some pre-prescribed retail pricing level?
Coin collecting is not some right or entitlement, it is not necessary to our economy in any way shape or form except as a pleasurable diversion to those who choose so. Granted, numismatics does create jobs, millions and millions of dollars change hands every year and a whole industry exists, but it exists based purely on elective choices by those with discretionary income. If a person wants to collect coins, he/she needs to be self-educated just like they would need to be in buying any luxury item.
BTW, my business partner enjoys rare timepieces. If you want to see ultra expensive collectables, read up on rare watches. THe prices are astronomical in some cases, and the timepiece serves no better function in many cases more than a $7.00 quartz watch at Wal-Mart.
<< <i>Andy, you know exactly what it says. Please stop trying to get me to post things you can legally threaten me with.
Eric - I have never threatened you and have no plans to do so. Nor do I have any interest in defending most of the people that you think I'm defending. The fact that I often disagree with you on some things you say does not mean that I disagree with you in spirit. In fact, I'm sure your heart is in the right place. You just get carried away. That said, I think you were trying to state the obvious: sellers that price their goods in an uncompetitive manner prefer to target unknowledgeable buyers. I agree. However, the fact that a seller does not offer highly competitive prices does not mean that he is guilty of fraud. >>
This scenario of high pressure selling of overpriced merchandise to the uninformed isn't unique to the coin business. Think of the roofing, paving or aluminum siding scams that were rampant a couple decades ago. A whole lot of the elderly were ripped off by fly-by-night contractors selling substandard work.
Is the sale of coins as an "investment" at inflated prices illegal? I honestly don't know. But, like the contracting scams, it's damned sure wrong and it reeks. Even if the issue isn't a legal one, it sure is an ethical and moral one and those who engage in the practice have little of either.
You guys sure ran with this one, although on some tangents I would not have endorsed.
My original thesis was that numismatic items are collectible and as such may be priced, by the seller, at any price.
Once, the seller introduces the theory of capital growth, or Investment, the whole pricing structure is much influenced and changed. If an item is sold as an investment, it must be totally price dependant on the current market, or if there is no current market, then with proper background why it should increase in value.
I did much of the work for the FTC, USPS, and state AG's in the 80's, based on that premise. There was no problem with the price charged, unless there was the "investment" concept introduced. This is where the regulation may be of value.
Numismatics can be a great investment. Eliasberg began his collection, primarily as an investment, and it turned out just fine. A great Dallas collection, began more than 25 years ago, primarily as an investment, has turned into a great collection, and in all probability will be a great investment. Harry Bass got interested initially, as in investment. All of these people learned before they spent their money. Numismatics, as an investment, is an extremely sophisticated field, like, as has been previously stated, art and antiques.
Boiler room, high pressure tactics, should be subject to regualation, but there are government agencies, already in place to deal with these.
In the field of numismatics, we have the ANA and the PNG to deal with our members, and we have dealt with them, in the past, in a very appropriate manner.
If there are problems with numismatics, they can be dealt with, in the framework that is already in place.
Again, Happy Holidays to all.
PNG member, numismatic dealer since 1965. Operates a retail store, also has exhibited at over 1000 shows. 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.
He is and articulated the idea better than anyone.
Tom >>
Well sure. But who is he to throw oil on troubled water and try to return the thread to its original topic? Looks like just another way to stir the pot to me.
Based upon my experience, I feel an item is worth X.
If the buyer agrees, no foul.
If the buyer gets buyers remorse or differing counsel, during my return period, again, no foul.
If the seller tells the buyer that it is a good investment, and happens to be using bad sales tactics, that is when the foul comes in.
Who am I, or for that matter, who are you to tell a buyer that the item is not worth X, unless we can back it up with something.
Buyers, especially in the luxury field of numismatics, have to be satisfied.
Beauty is in the eye of the beholder.
Buyers MUST learn about numismatics, before jumping in with both feet. My counsel and advice!!!!
PNG member, numismatic dealer since 1965. Operates a retail store, also has exhibited at over 1000 shows. 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.
Current quotes from published newsletters, columns, or auction prices realized for "comparables", if not the exact same item, always remembering that each item is better or worse than another of the same description.
The higher the rarity of an item, the less you will be able to match it up with a comparable, but at least you will be able to show something printed to give some credibility to your evaluation.
PNG member, numismatic dealer since 1965. Operates a retail store, also has exhibited at over 1000 shows. 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.
<< <i>[as someone familiar with SEC filings, I know you know what I am talking about and your comment bears this out.Wouldn't it be nice if certain dealers had to live up to the same standard. >>
If coins were a security, you wouldn't see the TV and media ads hyping overpriced moderns and other stuff to the uninformed public (investing) community (at lease not without lengthly disclaimers). There would surely be a hot market in get out of jail free cards too!
If security regulators governed the numismatic auction business, it would be a whole new world IMO.
If coins were a security, you wouldn't see the TV and media ads hyping overpriced moderns and other stuff to the uninformed public (investing) community (at lease not without lengthly disclaimers). There would surely be a hot market in get out of jail free cards too!
If security regulators governed the numismatic auction business, it would be a whole new world IMO. >>
TV and media ads hype everything they sell. In fact, until just a few weeks ago they only hyped the old coins they sold and except for high grade eagles didn't do any hyping of moderns.
Comments
That's not true. Sure, some other markets offer lower transaction costs and are more "transparent". Sure, some other investments generate cash flow and exponential capital growth. Sure, an intelligent investor will in the long run probably do better in other areas than in coins. But coins have a long history of price appreciation and the future is every bit as promising, if not more so.
In other words, coins are an OK investment and a GREAT hobby.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Eric - What does it tell you?
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
<< <i>In other words, coins are an OK investment and a GREAT hobby. >>
I've never considered coins an "investment" per se.
But I do recognize desirable and scarce (relative to historical demand) coins as a store of value, and I have little problem justifying some coin purchases with our savings, recognizing it as a form of diversifying household net worth as compared to plowing all of our savings in the stock market and such. (The total market value of my coins still only represents less than 5% of what we have set aside in retirement accounts for investing, so it's not like I'm putting the future at risk if we have a 1989-style meltdown.)
So while I don't track coins like investments -- and I don't consider them investments per se -- it's nice to know that there's something I enjoy which, in the long run, will probably hold its value if not make a little money if I needed to sell. (Of course, if you aren't knowledgeable and let yourself get ripped off, that might not apply.) But it's nice to have a hobby which, in the long run, can MAKE you money instead of COSTING lots of it.
<< <i> But coins have a long history of price appreciation and the future is every bit as promising, if not more so. >>
Investments based on "price appreciation" alone (along with the other things I mentioned) are terrible investments, IMO. It is a TERRIFIC hobby however and there we agree.
jom
EDITED: Just to add. It might be a good "hedge" like gold is. Maybe there was can agree to an "OK investment" grade for coins.
<< <i>do these dealers selling the overpriced common gold advertise in any of the coin periodicals? As far as I can tell, the answer is no, and it is really telling.
Eric - What does it tell you? >>
Andy, you know exactly what it says. Please stop trying to get me to post things you can legally threaten me with.
A formal complaint against one of these dealers is being filed with the Texas AG on Monday. And with that, I'm through here.
Some are; many are not. In fact any coin that can be sold for MORE than you paid for it is a good investment in my book. More folks have probly lost their ass in the stock market than likely have ever lost it in coins.
If we can refer to the purchase of a home as an investment...
Then we can certainly refer to our coin collections as investments.
Doesn't mean coins, or homes, or diplomas should be equated with stocks and bonds.
Just that the word "investment" has a broader meaning than some of us would like.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
<< <i>In fact any coin that can be sold for MORE than you paid for it is a good investment in my book. More folks have probly lost their ass in the stock market than likely have ever lost it in coins. >>
Probably so, but most of those who lost their butts in the stock market were either short-term market timers or didn't diversify their stock investments. Folks who were both long-term and diversified in their stock investments have definitely not lost their butts.
Besides, if I buy a coin 10 years ago for $900 and sell it today for $1000, is that a good investment? I think not, despite selling it for more than I paid for it; in terms of inflation I've lost money, and I could have made a better return by sticking the $900 in a regular savings account.
Having said that, again, I recognize nice coins with appreciation potential as a "hedge" or a way to diversify net worth...but I don't really think they are "investments" in the true sense of the word, and as I said before in this thread, any dealer that sells or hypes coins primarily from the "investment" angle deserves to be subject to similar scrutiny and disclosure requirements as securities dealers and brokers.
<< <i>If we can refer to a college education as an investment...
If we can refer to the purchase of a home as an investment...
Then we can certainly refer to our coin collections as investments.
Doesn't mean coins, or homes, or diplomas should be equated with stocks and bonds.
Just that the word "investment" has a broader meaning than some of us would like. >>
I was pitched by the salesman on a new 560SL a few years back how much of an "investment" it was and not just a car. I was in my show off period and bought it. Lost 30K when I dumped it ( was a piece of crap).
Bad "investment".
Now I drive a Jeep. It's a good investment vehicle particulary when needing to drive up those vertical roads around Asheville NC!
Tom
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
Eric - I have never threatened you and have no plans to do so. Nor do I have any interest in defending most of the people that you think I'm defending. The fact that I often disagree with you on some things you say does not mean that I disagree with you in spirit. In fact, I'm sure your heart is in the right place. You just get carried away. That said, I think you were trying to state the obvious: sellers that price their goods in an uncompetitive manner prefer to target unknowledgeable buyers. I agree. However, the fact that a seller does not offer highly competitive prices does not mean that he is guilty of fraud.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Numismatics is big business because there are hundreds of millions of coins to collect and tens of thousands of interested collectors. Swap meets are also big business all over America, but why isn't the goverment stepping in and forcing the vendors at swap meets to sell their art, beads, jewelry, paintings, crafts, pottery, and general do-dads at some pre-prescribed retail pricing level?
Coin collecting is not some right or entitlement, it is not necessary to our economy in any way shape or form except as a pleasurable diversion to those who choose so. Granted, numismatics does create jobs, millions and millions of dollars change hands every year and a whole industry exists, but it exists based purely on elective choices by those with discretionary income. If a person wants to collect coins, he/she needs to be self-educated just like they would need to be in buying any luxury item.
BTW, my business partner enjoys rare timepieces. If you want to see ultra expensive collectables, read up on rare watches. THe prices are astronomical in some cases, and the timepiece serves no better function in many cases more than a $7.00 quartz watch at Wal-Mart.
Tyler
<< <i>Andy, you know exactly what it says. Please stop trying to get me to post things you can legally threaten me with.
Eric - I have never threatened you and have no plans to do so. Nor do I have any interest in defending most of the people that you think I'm defending. The fact that I often disagree with you on some things you say does not mean that I disagree with you in spirit. In fact, I'm sure your heart is in the right place. You just get carried away. That said, I think you were trying to state the obvious: sellers that price their goods in an uncompetitive manner prefer to target unknowledgeable buyers. I agree. However, the fact that a seller does not offer highly competitive prices does not mean that he is guilty of fraud. >>
Bingo!
Tom
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
This scenario of high pressure selling of overpriced merchandise to the uninformed isn't unique to the coin business. Think of the roofing, paving or aluminum siding scams that were rampant a couple decades ago. A whole lot of the elderly were ripped off by fly-by-night contractors selling substandard work.
Is the sale of coins as an "investment" at inflated prices illegal? I honestly don't know. But, like the contracting scams, it's damned sure wrong and it reeks. Even if the issue isn't a legal one, it sure is an ethical and moral one and those who engage in the practice have little of either.
Russ, NCNE
You guys sure ran with this one, although on some tangents I would not have endorsed.
My original thesis was that numismatic items are collectible and as such may be priced, by the seller, at any price.
Once, the seller introduces the theory of capital growth, or Investment, the whole pricing structure is much influenced and changed. If an item is sold as an investment, it must be totally price dependant on the current market, or if there is no current market, then with proper background why it should increase in value.
I did much of the work for the FTC, USPS, and state AG's in the 80's, based on that premise.
There was no problem with the price charged, unless there was the "investment" concept introduced. This is where the regulation may be of value.
Numismatics can be a great investment. Eliasberg began his collection, primarily as an investment, and it turned out just fine. A great Dallas collection, began more than 25 years ago, primarily as an investment, has turned into a great collection, and in all probability will be a great investment. Harry Bass got interested initially, as in investment. All of these people learned before they spent their money. Numismatics, as an investment, is an extremely sophisticated field, like, as has been previously stated, art and antiques.
Boiler room, high pressure tactics, should be subject to regualation, but there are government agencies, already in place to deal with these.
In the field of numismatics, we have the ANA and the PNG to deal with our members, and we have dealt with them, in the past, in a very appropriate manner.
If there are problems with numismatics, they can be dealt with, in the framework that is already in place.
Again, Happy Holidays to all.
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
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
<< <i>Julian - You are such a troublemaker! >>
He is
Tom
Coin's for sale/trade.
Tom Pilitowski
US Rare Coin Investments
800-624-1870
- Eric
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
<< <i>
<< <i>Julian - You are such a troublemaker! >>
He is
Tom >>
Well sure. But who is he to throw oil on troubled water and try to return the
thread to its original topic? Looks like just another way to stir the pot to me.
Based upon my experience, I feel an item is worth X.
If the buyer agrees, no foul.
If the buyer gets buyers remorse or differing counsel, during my return period, again, no foul.
If the seller tells the buyer that it is a good investment, and happens to be using bad sales tactics, that is when the foul comes in.
Who am I, or for that matter, who are you to tell a buyer that the item is not worth X, unless we can back it up with something.
Buyers, especially in the luxury field of numismatics, have to be satisfied.
Beauty is in the eye of the beholder.
Buyers MUST learn about numismatics, before jumping in with both feet. My counsel and advice!!!!
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
Wearing my devil's advocate cap...
"Back it up with something"? Like what? The CDN or CW Trends or auction records for substantially similar items?
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Current quotes from published newsletters, columns, or auction prices realized for "comparables", if not the exact same item, always remembering that each item is better or worse than another of the same description.
The higher the rarity of an item, the less you will be able to match it up with a comparable, but at least you will be able to show something printed to give some credibility to your evaluation.
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
<< <i>[as someone familiar with SEC filings, I know you know what I am talking about and your comment bears this out.Wouldn't it be nice if certain dealers had to live up to the same standard. >>
If coins were a security, you wouldn't see the TV and media ads hyping overpriced moderns and other stuff to the uninformed public (investing) community (at lease not without lengthly disclaimers). There would surely be a hot market in get out of jail free cards too!
If security regulators governed the numismatic auction business, it would be a whole new world IMO.
<< <i>
If coins were a security, you wouldn't see the TV and media ads hyping overpriced moderns and other stuff to the uninformed public (investing) community (at lease not without lengthly disclaimers). There would surely be a hot market in get out of jail free cards too!
If security regulators governed the numismatic auction business, it would be a whole new world IMO. >>
TV and media ads hype everything they sell. In fact, until just a few weeks ago
they only hyped the old coins they sold and except for high grade eagles didn't
do any hyping of moderns.
See the hype thread.
do not per se have this investment characteristic. But they are broadly defined PART OF
any complete investment portfolio, as some protection against depreciation of future cash flow/asset growth.
Hence, rare coins and/or bullion is a common and widely used "hedge", or insurance part, of an intelligent asset allocation.
A balanced INVESTMENT PORTFOLIO really should be viewed, if sold as part of a intelligent investment stategy,
within the regulations and existing laws governing all investment asset classes. In other words, if you have $100,000
in coins as part of a $1,000,000 retirement investment portfolio, you got an investment, if you know it or not.