Is this THE sign of a market top? A Littleton ad in The Wall Street Journal!

DaveG

(I haven't seen this posted before, but if it has, I apologize for missing it.)

Yesterday I was happily reading my copy of the Eastern Edition of the WSJ, when what should appear before my eyes? A quarter-page ad on page B7 from Littleton! Now, as you can imagine, a quarter-page ad in the WSJ is a pretty serious investment (especially for a coin dealer)!

They were offering a dozen silver dollars - all raw, by the way. Here's a list of what they were offering, along with the latest Coin World Coin Values retail price in parentheses:

1800 XF-40 for $5850 ($4000)
1859 MS-63 for $6500 ($6000)
1877-S Trade MS-64 for $4500 ($4000)
1878 Trade PR-65 for $9750 ($14000)
1880 Trade PR-64 for $5300 ($5000)
1880-CC Morgan MS-65 for $2250 ($1800)
1885 Morgan MS-64 for $5300 ($3000)
1892-CC Morgan MS-65 for $10900 ($12000)
1895-O Morgan AU-55 for $3650 (CV doesn't price an AU-55)
1900-O/CC Morgan MS-64 for $2100 ($1700)
1921 Peace MS-64 for $1195 ($1000)
1924-S Peace MS-64 for $1550 ($1200)

Considering the high cost of the ad, I was surprised that the prices weren't higher. (I suppose the ad could represent a loss leader to bring in new clients.)

Is this the top of the market?

orie

Don't have a clue, I'm not a market maker!!

Coinosaurus

That's not a good sign. And there was some outfit in CW this week trying to lend capital. Not a good sign either. The end is near. Hopefully the market will really tank so I can finish my date set of proof $20s

RYK

Both Len's and Dave's observations could signal the beginning of the end. Now, where did I stash Heritage's phone number?

Longacre

Our subscriptions to the WSJ were revoked in a "cost cutting measure" so I did not see the article (even if I was in the office). I think it is a sign that the end is near. However, I noticed that Littleton is advertising more in the numismatic publications, so maybe this is part of their advertising strategy. When B. Max Mehl advertised in Sunday inserts, did any collectors ask whether the end was near back then? I am not sure, but this is not a good sign.

cladking

<< <i>Both Len's and Dave's observations could signal the beginning of the end. Now, where did I stash Heritage's phone number? >>



Can't you just sell to a market maker?

TheRaven

I would say that yes we are at the top.....

We don't go what 2 or 3 days with one of these threads, when it is this heavy of a topic I think that means something.....

bgrice

When dealers/sellers start taking my offers without countering then I'll agree that the top has been made. I'm 1 for 1 in the last few days. More research & offers are in process. Only time will tell.

AgMe

I have a feeling we just past the top and are on the way down.

~g

RYK

Both Len's and Dave's observations could signal the beginning of the end. Now, where did I stash Heritage's phone number?

<<Can't you just sell to a market maker?>>

To be truthful, Sam, I would probably do much better with most of my stuff selling to the "market maker".

robertpr

You still read those funny things made with trees and ink? I think they were once called newspapers...

BigE

I don't understand why Littleton trying to sell coins at over market in the WSJ means the market has peaked, to me it means they are searching for poeple with more money than brains-----------BigE

Coinosaurus

Biggy-

The idea is that once "investment" quality coins hit the mass market, the bubble is about to burst. It is thought that only "long term collectors" can ultimately sustain the rare coin market & I believe that has been proven in the past.

That said, I don't get the feeling that a lot of non-collector money is coming in - yet........

JoshL

Millions of new people collecting coins because of the State Quarter Program. Eventually a percentage of these people will get tired of quarters and expand their collections. More collectors = less coins.

BigE

OK, thanks Coinasaurus, I didn't know that Littleton had investment quality coins, the ones above are raw and probably overgraded and/or cleaned---------------BigE

TwoSides2aCoin

<< <i>I don't understand why Littleton trying to sell coins at over market in the WSJ means the market has peaked, to me it means they are searching for poeple with more money than brains-----------BigE >>




LOL and brilliant !

Coinosaurus

<< <i>OK, thanks Coinasaurus, I didn't know that Littleton had investment quality coins >>



I don't know that they do either, but when they take an ad in the WSJ advertising four figure coins, chances are that the public would perceive it as an investment type offering.

BigE

But what the "public percieves" as investment coins won't affect the market I hope, or you could make it crash anytime you wanted to--------------------------BigE

deansmint

My understanding is that there are numerous private coin funds that have been established these past couple years as opposed to the larger and more publicly know funds that chased the market to its highs in '89. I do think there is a very strong investment funded basis to this market only with the lessons learned from the past they are very well hidden. Most collectors wont know that the market has peaked untill it is well past the top and heading down quickly.

RedTiger

I think it is good business. Not many people will answer the ads, however, each person that buys from that ad is probably worth $50,000 on average to Littleton. These are people with lots of money that buy one or more high dollar coins on impulse, without doing much research, and are willing to pay over well over retail.

I do not see it as all that different from some of the big ads in the coin magazines that have certain coins listed for sale at for 50% to 100% above what those coins would bring at auction. Not many buyers, but boy, those names are gold to a company. Littleton has a bigger ad budget than most of those coin companies so can go after bigger fish with a lower percentage rate of hits.

Littleton is known for paying top dollar for common coins, see their buy ads in the back of the major magazines. They do tend to be finicky as to what they will buy at their prices. What they sell is often decent for the grade though at very high prices.

As to a sign of the top, could be, could be. However, if the ad is successful, demand, and prices for that kind of material is going to go higher in the short term. Littleton will seek to buy more coins, often above currents bids to fill the new demand.

deansmint

The problem lies within this fact, 'The short term.' Pandering to a market with no knowledge of coinage based on future values and investment potential causes an unhealthy influx of unstable money. I believe this has been going on way too heavily for a little too long now.

DaveG, I'd be curious to know if this ad refered to the large increases and investment aspects of the coin market in the last few years?

Coindexter

At this point in my collecting activity I LIVE for an all out crash.

Michigan

I have the ad right in front of me, it reads:

"Rare silver Dollars"

"12 U.S. coins recently emerged from private collections - soon to
disappear again. Scarce one-of-a-kind showpiece - huge
collector demand".

The coins are then listed along with a toll free number, a coupon
to fill out and Dave Sundman's smiling mug at the bottom of the
ad.

I guess you could ask if there is such a huge demand for these
coins then why did they need to take out an ad in the WSJ
to sell them?

But that of course is not the point - they want people to think of
coins as an investment for the future. My guess is that if you
bought one of these that the good people at Littleton will be
contacting you in the future to buy more coins.

PerryHall

Notice that they avoid using the word "investment". I guess they don't want to deal with the Federal Trade Commission.

Michigan

<< <i>Notice that they avoid using the word "investment". I guess they don't want to deal with the Federal Trade Commission. >>




They have learned from the mistakes of others - best to avoid certain words, especially advertising in a
financial publication.

BAJJERFAN

I would be more concerned if they were dumping them at a deep discount!