Platinum destroyed
nycounsel
Posts: 1,229 ✭✭
$1350 an ounce.
Dan
0
nycounsel
Posts: 1,229 ✭✭
Comments
I wonder if Modern Coin Mart got rid of all those '07 Anniversary sets they bought @ $2100/set? whew......
-wes
Too many positive BST transactions with too many members to list.
as is your response
<< <i>predictable and not unexpected.
as is your response >>
what's next, oh great one?
<< <i>fc,
what's next, oh great one? >>
that nycounsel will hype these rounds as a great buy at current levels
and people will lose more money.
after all the mintages and other misc info shows it to be a practical lock.
hey, i sold all my PMs. i did not hang onto them like they were an only child.
i thought for myself and did not get into the group think that pervades this
forum to the point of being illogical.
To think that they would go up and then continue to rise is a disaster just waiting to happen.
Therefore, having the fall is totally predictable. The real trick is in knowing when to sell (as Russ cn attest to) and when to buy (as Andy can attest to).
The name is LEE!
I'll offer up a prediction of my own.
FC will continue to troll posts about coins he professes no interest in.
Some people use this board to share information and opinions about coins they enjoy.
I have yet to discover what FC enjoys collecting or why.
The figure beneath his name suggests he is a prolific poster; maybe he has expertise or insight with respect to other aspects of our hobby?
<< <i>that nycounsel will hype these rounds as a great buy at current levels
I'll offer up a prediction of my own.
FC will continue to troll posts about coins he professes no interest in.
Some people use this board to share information and opinions about coins they enjoy.
I have yet to discover what FC enjoys collecting or why.
The figure beneath his name suggests he is a prolific poster; maybe he has expertise or insight with respect to other aspects of our hobby? >>
i am sensing you are upset for some reason.. oooh yea. platinum was destroyed and
it turns out the people stating mint bullion coins were just that, bullion. directly tied
to the price of the PM and had very little numismatic value even though you desperately
wanted to prove otherwise via rarity, mintages, slabbed grades, and etc...
from my perspective, the trolls were the ones hyping this stuff and many here know
exactly who they are. so be happy you played the troll card and have reached rock
bottom!
<< <i>predictable and not unexpected. >>
Isn't this both redundant and repetitve?
That is, of course, very true.
I think what most of us are responding to is how quickly it rose and how quickly it fell.
It's not in the nature of a collector to time the market.
As things go up, we could sell for a profit, but most collectors have an attachment to their coins that makes parting with them difficult.
I have a fair number of platinum coins in my collection, and the bullion value has definitely taken a beating in the last month.
I'm a big boy, I can handle it.
I'm more interested in what is going to happen to the 2008 platinum coins; will the Mint reprice lower, or will platinum collectors have a dramatically lower mintage key date? Even if the Mint does reprice lower, we're on pace to have another record low mintage this year.
I do like small mintages, but they're not good for platinum collectors, since low mintages mean low interest, and the size of the collector base raises serious questions for the sustainability of the program.
Personally, I think the Mint should discontinue platinums after 2008, or at least dramatically scale back the offerings.
My vote would be kill the $100, $50 and $10, and just stay with the relatively affordable $25, though given the $50 reverse proof and the drop in platinum bullion, there are good reasons to go with the $50. Offering one coin only might help build a sustainable collector base.
The Mint has been offering SO many coins that it is impossible to purchase all of them.
More affordable series, like the American Eagle Silver Dollar, are affordable and popular, with a large healthy base. The more expensive gold and platinum offerings had a smaller base to begin with and in the last year or two we've seen a dramatic increase in the number of offerings att the same time bullion dramatically increased; largely splintering the hobby.
Instead of a broader group of gold collectors, we have American Eagle golds, First Spouse golds, Buffalo golds, proof, reverse proof, uncirculated. Platinums now have proof, w uncirculateds, bullion uncirculateds. Too many offerings, too expensive. Since the Mint doesn't seem interested in scaling things back, collectors are forced to.
Niche collections aren't good because numismatic premium does not exist outside of collector demand. If there aren't enough collectors to support a premium, the coins might as well be bullion rounds. That's true for all coins of course, not just moderns. The only thing that makes a 1909s vdb cent valuable is the group of collectors willing to pay more than 1 cent for it. If the collectors disappear, so does the value.
Moreover, niche collectors might not cross over to other series when the Mint eventually ends whatever subset they are collecting. That isn't good for the Mint and it isn't good for the hobby.
it turns out the people stating mint bullion coins were just that, bullion. directly tied
to the price of the PM and had very little numismatic value even though you desperately
wanted to prove otherwise via rarity, mintages, slabbed grades, and etc...
Bullion coins are tied to the price of bullion. Yeah? What am I missing here? Some of them develop numismatic value because whether fc likes it (or not) they are collected. And if we get a low mintage issue, you can be sure that the flies will be all over it - no different than any other coin ever issued that developed a numismatic premium. fc, if you have an agenda that is anti-bullion, so be it. It's still a free country, but your position is a bit ridiculous.
I knew it would happen.
My longer post explains my theory as to why that has happened.
Your point is proven wrong by the fact that some of these coins DO exhibit a numismatic premium.
The 2004 platinum proofs were reaching $8,000 a set in 2005. Bullion wouldn't do that.
The more common platinums have been trading at bullion for some time, and as bullion increased, it absorbed the numismatic premium for others, like the 2005 proofs. It even overcame the numismatic premium for scarer larger coins, like the 2006 w uncirculated $100s.
I think what we are seeing now is less a result of the rise and fall of platinum, and more a result of the Mint's flooding the market with expensive coins. I suspect that some modern collectors who previously would purchase a set of gold and platinum American Eagles can't afford to get everything, and are forced to select among different offerings. Giving up platinum, the most expensive offering, is a logical choice. Even among platinums, we used to just have the proof coins and the less collectible bullion coin. In 2006, with the introduction of the "w" uncirculateds -- and discounting the collectibility of the bullion uncirculateds-- there were now two platinum series to select from, at the same time that platinum was becoming more expensive. Splintering the collector base is certainly hurting numismatic premium.
i never argued that point.
that ASE with the different reverse, 07/08 what not, is another
perfect example.
the sheer majority of it, slabbed or raw, was always bullion to me.
i really expect to see a lot of it showing up on the bay shortly and
selling for remarkably low prices compared to one year ago today.
I agree. Making a big profit on a trade isn't that common and it entails substantial risk. To read these boards, you'd think that some of these guys do it day in and day out, and have enough money from the profits to buy their own island - when in reality they are blowing smoke.
Trading in pms isn't the same thing as investing in pms, and when fc starts going on and on about how brilliantly he called the "top" at $900, he's merely showcasing his trading mentality. And when he starts in about how fantastic it is to see precious metals crashing through the floor, he's setting himself up for some viscious commentary when things turn around, which they always do.
I knew it would happen.
<< <i>from my perspective, the trolls were the ones hyping this stuff and many here know
exactly who they are. so be happy you played the troll card and have reached rock
bottom! >>
I don't mean to take sides, but what fc is saying here pretty much sums up my thoughts as well.
Collecting these coins for their numismatic beauty is fine, but getting upset over a sudden plummet in bullion prices suggests the owners of these coins are thinking more like investors as opposed to collectors despite what they would have you believe.
I collect Buffalo nickels and Lincoln cents and I'm happy to see their values go up. However, I wouldn't loose a moments sleep if their prices dropped 50% overnight. In fact, I'd see it as a great opportunity to add to my collection.
I haven't read many posts hyping PMs, and my interest in platinums is as a collector.
I like the designs and the low mintages. Low mintage coins are the way to go regardless of what you collect. In some cases low mintage is relative. 6,000 is not considered low mintage for platinum, while 25,000 would be low mintage for silver. As many have said many times, low mintages are only part of the equation. Demand needs to exceed the mintage for a numismatic premium to exist.
If you are one of hypsters learn to accept critique
A critique involves a reasoned response; a distinguishing feature from an insult.
<< <i>The only thing I'd like more than seeing someone here make a profit trading PM's is to see that no one takes that risk who can't really afford it. If you are one of hypsters learn to accept critique.
I agree. Making a big profit on a trade isn't that common and it entails substantial risk. To read these boards, you'd think that some of these guys do it day in and day out, and have enough money from the profits to buy their own island - when in reality they are blowing smoke.
Trading in pms isn't the same thing as investing in pms, and when fc starts going on and on about how brilliantly he called the "top" at $900, he's merely showcasing his trading mentality. And when he starts in about how fantastic it is to see precious metals crashing through the floor, he's setting himself up for some viscious commentary when things turn around, which they always do. >>
of course. a cycle. it is time to slowly accumulate again and the
process continues. holding it tight with no plan in place or goals in
mind is foolish.
i bought 20 Oz of silver this week and have already lost a few dollars. Next week i will buy more.. etc... thus getting in slowly and
dumping it all at the correct time.
lets be honest.. did not everyone here notice gold at 1000 and how difficult it was for it to stay above it with all the bad news? it was an
easy sign to determine time to dump it... it was due for a correction.
in two years time it could very well be back at 1000!
plat on the other hand seems to be more for manufacturing and
was really speculated on right during that power crisis in Africa. A
very obvious bubble there.
I haven't really seen any posts by people who seem really upset about it; it's only natural to make note of it.
Gold climbing to $1000 was news, silver going to $20 was news, platinum reaching $2100 was news. All of it is related to the resale value of our colletions. Gold returning to $700, platinum to $1300, silver to $12, similarly newsworthy. Lower bullion value should result in lower issue prices so, though it might mean that our collections have lost some value, the flip side is that we can expect lower prices on future Mint offerings.
Wondercoin
Good to hear from you. Destroyed was deliberately provocative, but the bullion drop has been so sharp, the gains we saw in the beginning of the year have largely been wiped out.
As for what you see in the numismatic community, you're right. Most auctions on ebay now are "buy it now" style. We're at a standoff, potential sellers are reluctant to accept the loss of missing the high, and some buyers willing to offer a slight premium over current melt in case we bounce back from the low. Once prices start to stabilize a bit I expect we'll see more movement.
Wondercoin made a nice summary of this.
<< <i>PM's have always gone UP and then come down.
I'm more interested in what is going to happen to the 2008 platinum coins; will the Mint reprice lower, or will platinum collectors have a dramatically lower mintage key date? Even if the Mint does reprice lower, we're on pace to have another record low mintage this year. >>
Very interesting question of which I do not have an answer. However, should they price the coins lower, what will the customer response be?
Those that purchased already, will they want a refund of the difference? Will the US Mint give it?
Those that purchased at the end of 2007, will they want a refund of the difference? Will the US Mint give it?
The base value of these coins has always been in their intrinsic bullion value. Numismatic value is added by the secondary market which goes through waves of high returns and low returns.
I've watched a lot of folks get in on the Precious Metals Coin Game (i.e. Eagles) because of lower mintages and pricing bonanza's due to either First Strike slabs, Anniversary Sets or just plain old hype!
Unfortunately, with such a steep decline in PM's, those folks that bought at the $1500+ prices are going to take it in the shorts! The exact same way that the $52 per ounce Silver Folks took it and the $850 per ounce Gold folks took it in 1982! Nothing new here except for the advent of the TPG'sand special labelling and the increased use of the Internet for the quick kill but bullion is simply doing what bullion does.............it goes up.........it goes down.
Just like poker, you gotta know when to hold them and know when to fold them!
The name is LEE!
Don't panic!
To me...things now look like they're running away on the down side...but I'd predict somewhat of a snap back to the $1,500-$1,600 level on platinum with gold to hover in the mid $800's once the smoke clears.
I say this because an examination of each of their 1-year charts now shows us not only working off the excess "fluff" since the start of the year, but also breaking the long-term trend lines too much to the down side.
What goes up, must come down...but will go back up.
While I usually disagree with him more often than not (same with my wife but useless to argue) at least fc does offer his reasons for his POV.
The important thing is that at least fc admits he is not always right and he had been consistent in his POV on pm's.
While I was not bearish on pm's since January, I was buying since January 2008 only as part of a measured accumulation program based on my buying in at the same level of dollars (not quantity) as before.
By buying based on dollars, you accumulate more pm's at lower prices and less pm's at hiher prices.
I wanted to buy more vintage pre 2004 PCGS PR69DCAM platinum coins this past fall and winter but was turned off by the high pm prices. So I protected myself against pm by buying three sets of the 2007-W proof plat coins from the US Mint before they jacked the price up.
Whether the platinum prices went up or down it did not matter to me as I then had trading stock for what I really wanted.
Sure, I "lost" an opportunity to buy at a cheaper price but I was willing to give that up in exchange for price protection on the upside.
Just buying pm's for the short run is risky. What pm's really should be viewed strictly as is insurance against things going wrong in the USA but not in the world as a whole.
If you are really worried about the world as a whole going down then only food, water, shelter and protection is all you want.
I've heard this before - is there a source?
Even if true, how does the Mint calculate their cost? Obviously bullion is a dominant component, but would equipment/labor/marketing costs be included? Since they jacked up the price of the 2007 anniversary/reverse proof set after the coins were made, would whatever additional profit was made after that repricing be considered in determining when they were in a loss position?
If they purchased all the 2008 stock at $2000 an ounce, and spot stays rangebound at $1200-1400 in the year to come, what do they do? Keep the 2008s in storage until they can sell for more, while buying the bullion for the 2009 coins at a lower price?
... at least fc does offer his reasons for his POV. The important thing is that at least fc admits he is not always right and he had been consistent in his POV on pm's.
I agree that FC is consistent, but as for pondering points and counterpoints or offering reasons for his POV, I must have missed them.
Seems to me that FC's comments are generally variations of:
(1) They aren't coins, they are "rounds"
(2) There is no merit to grading or collecting them
(3) Bullion coins are just that, bullion.
for instance FC said <i>"platinum was destroyed and it turns out the people stating mint bullion coins were just that, bullion. directly tied
to the price of the PM and had very little numismatic value even though you desperately wanted to prove otherwise via rarity, mintages, slabbed grades, and etc... </i>
There's no way that a platinum collector or anyone neutral would consider this comment as anything other than an attack on the merits of collecting them.
The mintages are a fact. Regarding slabbed grades, like almost all modern commemoratives and proofs they are virtually all 69s and 70s. I can agree that the distinction is almost as meaningless as the first strike designation, but a 70 will cost more than a 69, whether you're talking about a 2004 proof platinum or a lincoln memorial cent. You might think the person paying the premium is wasting his money, but that doesn't really speak to the merits of collecting that series as a whole.
FC says these coins are "bullion. directly tied to the price of the PM ... very little numismatic value". When it's pointed out that the 2004 proofs and 2006 w uncirculateds have consistently shown a premium to melt, he calls them "exceptions." Where is the logic in that? Bullion is bullion. There are no exceptions.
Essentially, FC's comment suggests that a premium to melt is a prerequisite for numismatic legitimacy.
A coin's numismatic merit does not depend on its premium over melt. At $1 an ounce, pretty much every silver coin would have a numismatic premium. At $12 an ounce, most circulated, common date silver coins lose show little premium over melt. If silver went to $100 an ounce, many silver coins, including uncirculated common dates, would be reduced to melt. That doesn't reflect numismatic worth, but non-numismatic demand.
The gradual erosion of numismatic premium when bullion increases is behavior seen for almost all series, it is not limited to platinum coins or other recent issues.
The recent swings in bullion have been dramatic -- evaluated from a strictly melt perspective the bullion value of my collection has gone through a substantial swing this year. I'm not complaining about that. I enjoyed the rise, I can handle the fall. But the fall is NOT going to impact the keys the way it will the common coins. A 1998 $100 platinum proof was worth melt in 1998, and is worth melt today-- the mintage is too high to command a premium. The 2004 proofs and 2006 ws (except maybe the $100) retained a premium to melt at $2100 an ounce. Those are not going to start tracking melt at $1300.
The fact is that, short term pain aside, a dramatic decline in platinum bullion is probably the best thing that could happen for collectors, since the only way we are going to build any sort of collector base is if the coins are more affordable.
The other thing that would help, in my opinion, would be for the Mint to cut back on their product lines. The collector market can only absorb so many offerings in the $300+ price range. There are too many expensive coins right now competing for limited collector dollars, and it is fracturing the market. The American Eagle golds will lose some collectors to the new Buffalo fractionals. The 2009 double eagle, a beautiful coin, will surely contribute to lower sales of other expensive offerings. Interest in the gold spouse coins started off pretty strong, but has already started to decline. Platinums are hit harder than anything. They're prohibitively expensive to begin with, the w coins pull some money away from the proofs, and the new gold coins will likely also have some impact.