Poll: Good/bad stock market good for coins?

RYK

I have seen published material with various opinions on whether or not a good stock market is good for coins or a bad stock market is good for the coin market.

Some say a good stock market is good for coins as collectors feel wealthy and will plow their profits into coins.

Others say a bad stock market is good for coins as collectors and others will feel like their investment options are limited and will turn to coins as an answer.

I have my own opinion which I will state later. What do you think?

jmski52

Overall, bad. There will be some capital flight to assets perceived as "safe" but the destruction of wealth and liquidity will be a larger factor, imo.

HonoluluDude

A bad stock market is good for commodities overall-- A flight out of paper assets into hard assets is and will be going on for years to come.

HonoluluDude

A visual to illustrate my point-- stocks are deflating vs. gold: chart

MikeInFL

Up to a point, a down stock market is good for coins as gold tends to run counter to the stock market and influence coins.
However, once the stock market goes down signficantly then collectors will likely feel that pain and reign in their spending, harming coin prices.
The question, in my mind, is where does that disconnect occur....Mike

Longacre

I think a down stock market fuels the coin boom. However, I believe there are charts out there that show there is really no correlation between the two. It just seems that way to me.

And I agree with whatever Saintguru says.

curly

A down market and low interest rates will push some ( but not all ) investors to alternative markets. As far as coins go, I think it will only help accurately graded rare coins with good eye appeal.

RYK

Here's my take:

I do not view coins as an investment vehicle.

I think that the stock market may or may not reflect the overall economic conditions at a snapshot in time.

The coin market is probably tied more closely to other indicators of the economy (unemployment, inflation, consumer sentiment, etc.) than it is to the stock market.

HonoluluDude

<< <i> The coin market is probably tied more closely to other indicators of the economy (unemployment, inflation, consumer sentiment, etc.) than it is to the stock market. >>

I agree with that sentiment. It's tied more closely to the falling dollar than the stock market.

CalGold

Much of the stock market is fueled by pension/retirement account money. That money cannot be placed into coins. People are seeing their long term savings (retirement accounts) evaporating once again--many have not fully recovered from the dotcom bubble. Couple that with a loss of equity in their homes--another long term investment plan for many people. Add in those whose business revenues are falling.

Now with all of that going on are people going to be more or less inclined to spend on an expensive hobby? Depends on which collectors you are talking about. The people who have more money than they know what to do with can continue to compete for trophy coins. The folks who are just buying properly graded, all there, eye appealing gems, but not the pop one/finest known/trophy material might start getting slow to reach into their wallets. Everyone else might start thinking about how much they can get for their sets today if they put them on ebay.

CG

shark1970

coins have to be a better investment than stocks right now.

my sales always suffer when the dow drops, though.

doesn't really make sense.

BECOKA

I know a few collectors that fund their coin purchases with stock winnings. If the stock is down for the year then not so many coins are purchased.

ziggy29

Good in the short term. I don't think a long, sharp and continued decline would continue to be good for the coin market for too much longer, though.

57loaded

a market is good or bad depending on what side of the trade you are on.

yet i voted that a "good" market....is good for coins (and in the minority apparently)

jmski52

Is it ok if I stated my case for a bad market to have a negative impact on the coin market, and still voted for whatever Saint Guru thinks in the poll?