Poll: "This time it's different." Yes or No?

RYK

the whole house of cards will fall apart one day not too far off..and this will be a bigger black hole than 1989..and i hope many big dealers are holding record large inventories when it inevitably happens..but believe me a lot of people are going to be left holding the bag this time around..hype or no hype

This is a direct quote from a forum member on another thread. I heard myself uttering those four scariest words: "This time it's different." and got spooked.

Is it different this time?

Wondo

"Those who fail to learn from history are doomed to repeat it" - Smoebody

Although the market circumstances are different, all collectible interest are cyclical. Numismatics has a long history and has been through numerous cycles. There will be an inevitable correction based on demand. Will everything correct? I don't know. Will the market crash - I doubt it. There are certain items that can be bought today for less than one would have had to pay for them six months ago.


1. Buy coins because you like them (you may have them for a long time).
2. Buy the best you can afford (increase the odds that smoeone will also want them).
3. Have fun (priceless)

Prethen

There is no comparison. Coins in general across the spectrum are moving up, but, for the most part they're not spiking upwards. They're making a relatively, smooth upward move. I realize that CC dollars and other areas might be experiencing faster price moves. Those areas might fall a bit in the future....and, then again, maybe not.

I keep hearing from dealers all around me that the collector market is hot. The good material, especially early type stuff, is not widely available and if you find it at all it can be quite pricey. The general consensus seems to be that collectors are still holding onto a lot of the good type material.

The State Quarter program has greatly energized the coin collecting market. There are truly a lot more new collectors and some of them are competing for the same material you are!

It will be interesting to see where the coin market stands in about 2-3 years from now.

TUMUSS

My coin buying habbits are based on at least 3 more years of upside. That's my story...and I'm stickin to it!

Longacre

I think that long-term buyers do not have anything to worry about.

DNADave

I can't wait till it does crash. Then I can buy some things that out of my reach right now.

Steve27

What goes up...

Bear

There is no new paradigme to the coin market.

It will race ahead of itself and then as all the pundits

cry that the sky is the limit, it will fall the next day.

Collect the best of what you can afford, be selective,

unload all the garbage, overgraded stuff you no longer need

or want and sit with your collection thru thick and thin. In 5 years

you will be smiling at the thought of how smart you have been.

As for committing onself, yes I think many here probably should

be comitted...................................................................... and soon.

saintguru

It's different..


*You have a vastly widening collector base

*You have a 20 year bear market in precious metals over, and now in a bull market

*The last bull in coins was driven totally by dealers thinking they would sell to the "funds"

*There is a desire for hard assets after the stock market hurt so many people...many are looking at coins as one of these alternatives.

*This is the "slabbed" generation of collecting...costly coins can "virtually" be bought over the phone with little trepidation...or at least little arguments over grades. (I know there are exceptions...but NOTHING like the old days)

*They aren't minting more RARE coins!! And you are seeing less as time goes on because they are being put away.


That's my TWO 1943 copper cents worth!

Russ

Yes, it IS different. When the inevitable crash comes, it will be happen much, much more quickly. That's the real impact of the internet.

Russ, NCNE

RYK

Yes, it IS different. When the inevitable crash comes, it will be happen much, much more quickly. That's the real impact of the internet.

I agree with the impact of the internet, but I am not sure how you voted based on your statement. I would guess "Yes".

BTW, I voted "No".

TheRaven

I would think that it is not different.

Being I started in 2001, the market has been warm to hot almost the entire time for me.

I am cautious on some things and want them but am not sure if I should get them such as:

Got an PCGS MS-63 84CC $1 for $115 bucks a while back and it is now $240, I would like to add the 82 & 83 at least and possibly more CC Dollars, but the prices have skyrocketed so not sure what to do.....

I have 6 of 8 Gold Coins for a $2.50 to $20 type set but the $5 Indian & $2.50 Liberty are damn expensive (Cert 62) that it makes me cautious.....

Elcontador

It's never different. I remember hearing all about a Dow 50,000 in 1999 and that earnings multiples did not matter. It was very funny to me.

Some people just don't get it. If someone tells you "this time it's different," I suggest you look at that person rather cynically. Everything runs in cycles, and numismatics is no exception. When it will happen and how ugly will it be? I don't know. But at some point, the market will go down.

slabfab

Naw, all markets move in cycles, it's just a matter of time. Since I collect more than invest I'm not paying it too much attention. About the biggest impact the market is having on me right now is that I may settle for a grade or two lower and plan to upgrade when it's not so much a seller's market.

BigGreek

This is a great poll. When the percentages move to about 75/25 in the other direction
it will be time to start getting out. We are still in the early stages.

RYK

When the percentages move to about 75/25 in the other direction
it will be time to start getting out. We are still in the early stages.


I will run them every six months or so, but I predict that there will be little change in the results of the poll over time. I do not think the membership here represents the collecting masses, but the more hard-core collecting base, many of whom have been burned in the past.

greghansen

I wasn't actively collecting in '89 but from what I've read and hear there are a lot of differences. From my perspective there is one unassailable difference, and its called demographics. The hobby (unlike social security and medicare) is looking at hugely favorable demographics for the next couple of decades.

mrearlygold

<< <i>This is a great poll. When the percentages move to about 75/25 in the other direction
it will be time to start getting out. We are still in the early stages. >>












There will be a VERY small percentage of people who know when to get out and that will be a guess, at best. And all the research, and percentage equations in the world won't save your butt when dealers in general say " sorry, I'm not buying any of those" today and no bids appear for anywhere near your cost.

I know of less than a handful of people who didn't get eaten alive in 81, and then again after the late 80's collapse. Does anyone who doesn't live this business full time all the time think you can predict this when guys who DO live this full time can't? Think again.

Yes it is different with more people than ever putting sets together. It's also different from the standpoint of what people are paying now for coins too. The evolution of the business since the introduction of the grading services is nothing short of wonderful. It's taken years and years to get "somewhat" stable with regards to alleged populations and the real scarcity or rarity of coins ( as seen recently with contursi's big drop on the services, oops service? Was it only pcgs tags sent in?), and more people than ever before are buying, selling and trading coins. It's been a great time especially recently to be in the business as well as a great time for dealers and our customers who have liquidated coins that were sold to them years ago. But you really need to be careful as it's not a guaranteed CD by any stretch.

I mean as a case in point, do you really think common variety 1799 Eagles in Ch AU are worth over 20G's?

How many do you want to buy?

Tom

RYK

Do you really think common variety 1799 Eagles in Ch AU are worth over 20G's?

No way!

DeepCoin

The one factor that may come into play in the near future is that given how we are spending billions more than we take in, I believe we are in for some serious inflation again in the next few years. Maybe not this year, but look out in 07 and 08. Just MHO. The coin market may not fall as far with cheaper dollars buying the coins. This prediction is worth exactly what you paid for it.

Barry

<< <i>I mean as a case in point, do you really think common variety 1799 Eagles in Ch AU are worth over 20G's? >>


I had a BU (Butt Ugly) NGC AU58 on approval about 2 years ago for about 9K, but returned it. I should have kept it and resold it now. Who wudda thunk it?

K6AZ

All I'll say is in the run up leading to the 89 crash, we heard the same thing. "This time it's different, Wall Street is in on it!".

What goes up comes down, it's a fact of life, and a fact in the coin market.

DHeath

I suppose the only question that's important to me is whether the coin market will be up 30 years from now when I leave my core to the kids. I do have a feeling which direction the dollar will move between now and then.

cladking

This time it's different.

Oh sure, there's nothing new under the sun and this market will correct at some point,
but in the mean time there is likely to be further growth. So long as most collectors and
dealers are bearish, so long as the collector base is expanding, and so long as most coins
are being bought for collections rather than for investment the market should continue its
increase.

coynclecter

The more things change the more they stay the same. Coins will go up then they will go down, we all know that. What we don't know is how far they will go up and when they will o down and how far they will go down. Many coins still have not seen the prices they had in the 1970's and 80's. There is still a lot of room to move up before they come down and the floor may be a lot higher than where we are now. There is also the potential that they could slide from here and not see these prices again for 10 years.

My guess is that the key here is not coins but inflation and interest rates.

eyoung429

If one factors in all the latest shill trends on Ebay, and they actually do something about it. The newer collectors will be a little more protected in what they buy and that will drive prices up somewhat. If the market keeps getting flooded with the crap copy coins and there's nothing to protect the unknowledgable from purchasing bad coins, prices will decline as more become aware of the mis-leading wording of some auctions.

nwcs

>"Those who fail to learn from history are doomed to repeat it"

Or as one person put it, those who fail to learn from history are doomed to repeat it -- those who fail to learn correctly, well, they are just doomed.

coinkat

I did not vote... I think it is alittle different this time. Several common coins really have not moved the way rarities have or coins that have a special quality to them. Will the market correct? Yes... When? perhaps when interest rates go up or other investment alternatives catch the mainstream.

Figure inflation and the buying power of the dollar... has the increase in prices for common coins across the board been that dramatic? Not for popular common date coins.

The buying opportunities are there for collectors that want to look hard and even consider coins and currency from other countries... especially if the coins/currency can be purchased within the US with US Dollars

ColonialCoinUnion

I have absolutely no idea, but I have a very detailed and carefully considered plan:

If prices keep going up, my collection will increase in value and I'll be quite happy.

If prices drop sharply, I'll buy more rare coins, perhaps even some beyond my reach today.

If nothing changes, neither will I.

RYK

CCU,

I am on your plan.

roadrunner

It is different because of all the economic market manipulations done today. Therefore the coin market at some point could easily explode upwards from here. But that same manipulation upwards will cause an eventual LARGE reaction downward.

Collectors will be able to figure this out. As a pure collector in late 1979 I was shaking my head at the prices and stopped buying. I started to sell all my problem coins that up to then had been unsaleable. And I made profits on them. I sat out the next 2 years and didn't by another coin until summer of 1982. Collectors just know when things are not right. But the 1989 market caught me square in the eyes because I was no longer thinking like a collector, but as dealer, investor, speculator, and then collector. Much perspective was lost.

The end to this up market will eventually come, either in 1 year, 3 years or even 5-10 years, but it will end with a sudden thump just as Mr. Early explained. But it may be a wicked ride to the top. Right now gold is on our side and will help propel the market. Until gold's upward move is stilted, coins have little choice but to respond the same.

roadrunner

mrearlygold

<< <i>I have absolutely no idea, but I have a very detailed and carefully considered plan:

If prices keep going up, my collection will increase in value and I'll be quite happy.

If prices drop sharply, I'll buy more rare coins, perhaps even some beyond my reach today.

If nothing changes, neither will I. >>








And yours is perhaps the best response of all from a true collector!

Tom

MAD4MORGANS

"Those who fail to learn from history are doomed to repeat it."
George Santayana

(I found the author of this quote on a Google search) He must have lost money in '89 too!
-----
You gotta wonder when our Government will confiscate our gold and silver because holding it will be "unpatrotic" or because it says "In God We Trust" it no longer will be legal tender?

...Doomed to repeat it-Previous Govenment Confiscation of Gold That as A Collector You NEED to Know

This time they may not stop at taking our collectible coins. I think it could get worse this time around.

-------

A penny saved is a Government oversight.

mrearlygold

Mr Roadrunner, yes the "true" collectors may figure quite a lot of it out as you did but how many are really true collectors?

I submit not many.


Rgrds
Tom

roadrunner

Maybe there are no true collectors left. It was possible back in 1980 but in today's internet times, there's so much information available, that we all become "experts", "soothsayers" and "dealers". The pure and experienced collector can stay distanced from the hype (and check for when the emperor's clothes are gone)

roadrunner

mrearlygold

Well there's quite a few that I know and thank my personal God for that.

But yes, there sure are a lot of ________ ( fill in the blank )


Rgrds
Tom

xbob

<< <i>I can't wait till it does crash. Then I can buy some things that out of my reach right now. >>





A "crash" won't stop me from collecting (if it happens). It will just make it more affordable.

BigAlan

I keep hearing from dealers all around me that the collector market is hot.


You would expect something different from people who are selling?

mrearlygold

<< <i>I keep hearing from dealers all around me that the collector market is hot.


You would expect something different from people who are selling? >>







All dealers are not the same as all coin "buyers and sellers" certainly do not qualify as collectors, Numismatists or even people in some cases.


Tom

keets

common sense dictates that someone will end up losing money when things slip, it's absolutely unavaoidable. armed with that knowledge it becomes a simple matter of being on one side or the other. if you're stuck with a largely devalued collection/inventory it becomes a matter of whether or not you can hold on till things rise again or whether you need to accept the loss and move on. my feeling is that when slip, they will slip much, much faster than they've gone up and buyers will be harder to find and more cautious. the best approach as a collector is to not have value you need to access tied up in a collection, that way the slide won't be troublesome. dealers have an entirely different worry since their inventory is their source of income.

my favorite story about this type of scenario is the one my buddy relates about selling bulk silver back in 1980. the next guy up from him went to bed one night with a $16,000 bag of silver and woke up with a $7,000 bag of silver. BUMMER!!!!!!!!!!!!!!

al h.

mr1931S

Not different this time. The inevitable correction just will be faster. There's only so much money out there.

It's amazing to me how many "rare" coins are currently available for purchase. When I see true ultra rarities for sale, eg. condition census '74-cc dime, it gives me pause to consider what's coming.

"If it wasn't for the whales, Las Vegas wouldn't be."

topstuf

Gonna be like a light switch this time.

There are no cushions in the line at this time.


Edited to add: The good thing is that the sheets will take forever to reflect it. Thus giving SMOE cushion.

Just watch the dealers that perceive their customers to be subhuman......and check their websites for SOLD coins. Smoe dealers must operate in different circles.

SellStock

dimples

I believe When long term interest rates start to move up to 7% or more then the middle market of $10k to 30k coins will see a big drop. Exuse me as I have to clean my crystal ball off.

SellStock

NO, it's not different, BUT..................first some background...

I started collecting coins in the 60s as a child --- pennies, nickles, dimes, the usual stuff in the Whiman folders -- and enjoyed the local dealer who ALWAYS treated me like a valued customer. When I went to college, I pretty much forgot about coins until my first job in the late 70s. I "tuned in" long enough to watch the craziness of silver and gold markets, but did nothing (NO $ -- probably just as well!). I re-ignited my love of collecting in mid/late 1990s after I got married and bought a home. Then, after attending several coin shows and learning about grading systems, how the dealers operate, etc. I finally started collecting again.

From someone who has observed and studied lots of different cycles (home prices, coins, art, stock market, comodiities), I would suggest that this cycle too will turn around, but it will be difficult to determine WHEN that will occur (1 year, 3 years, 5 years or more?). Why MIGHT it be different this time? Well, it might take longer to correct this bull market for several reasons:

1). First and foremost, there is no speculation in overall price levels, per se. Prices are up, to be sure, but there isn't anyone like the Hunt brothers in '79 trying to corner the market or a major player like Salomon Brothers (in late 1980s) pulling out of the business when they attempted to "legitizmize" the coin market. How could this change? I would say the ONLY current threat to the coin collecting/investment world would be if any of the MAJOR grading services (i.e. PCGS and/or NGC) ran into trouble and had to shut its doors. I think that probablility is pretty small, but I have not performed any due diligence on either of them.

2) Everyone seems to forget that these are CYCLES. The bear market in gold/silver/coins has been close to 17 years or so (once you discount the false run-up in 1989 due to Salomon Brothers entering the market). I recall back in '85-'86 how everyone thought stocks were a huge bubble. Well, the market was up signficiantly after being dessimated for almost 12 years! Prices still moved up almost 35% in 9 months in 1987 alone before the "crash" moved the market down to Dow 1700+ in October 1987. Dow 1700 doesn't look so bad now, does it?

3) Someone mentioned demographics and I couldn't agree more. Demographics (along with very low interest rates) has already moved real estate prices significantly higher over the past 5 years across much of the country. Now, I don't know about you, but the stock market has NOT DONE MUCH since the correction a few years back. Baby boomers are getting a bit anxious. Stocks aren't going away, but I suspect we are in a cycle comparable to the 1930s in the stock market.....at best, we will be on stable ground for about 5 years, At worst, we could see further slippage in the stock market. So, if you are a baby boomer with some spare $$, where do you invest part of it knowing that retirement is either at hand or in the next 15-20 years (like myself!)? Even if 2-3% of those boomers start looking at coins as an alternative investment (yes, I said INVESTMENT) option, the coin market could move MUCH higher over the next 5 years. That's the "iffy" part -- what are the alternative investments?

So, with that said, I believe prices will move higher, but not forever upward. It always comes down to ECON 101 -- supply and demand.

By the way, I, too, am amazed at some of the prices that early gold (e.g Choice AU 1799 eagles) are realizing, but keep in mind ECON 101. Prices are only "too high" if there is rampant speculation. If those "common certified choice AU 1799 PCGS" eagles are being placed in safety deposit boxes, those coins and many others could see higher prices. If they are just being traded back and forth among dealers, then look out below! Cheers!!!

rhedden

One observation about the 1989 crash that bears repeating is that high grade common coins took the brunt of the beating. The investor holding the box of PCGS MS-66 1881-S dollars lost 70% of his money. The collector with the box of "unpopular" circulated New Jersey colonial coppers (just to pick an example) lost virtually nothing. If someone said that PCGS MS-66 Morgan dollars were a horrible investment in 1988, they would have angered a lot of collectors and dealers alike. The worst losers were the owners of the most popular coins among investors and collectors alike prior to the crash! It's easy to get caught up in buying what everyone else is buying, so I've changed my collecting habits to explore less popular areas that are less subject to speculation.