Are we seeing a fundamental and permanent change in the coin business?

291fifth

Many posters have noted that buy-sell margins for numismatic coins seem to have increased over the past year.

Is the business of selling numismatic coins becoming a secondary endeavor for most dealers?

Are numismatic coins now viewed by many dealers as a pain to handle?

Is the necessity of not just having coins slabbed, but slabbed in the "right" holders with the "right" stickers driving up the cost of doing business and helping to kill interest in numismatic coins?

Have their used jewelry and bullion sales now pushed numismatic coins aside?

Comments ...

shottaker

Not a easy response to this other than the "death" of the common widget market. The high end stuff still sells well. Bullion is hot. Your 79 indian in XF (or plug in almost any 20-100 numismatice coin not bullion related) is an anchorweight. The guys that spent $20-$100 a week which are the lifeblood of this business are all out of work........
If I cant ship it, I don't dare pay real close if its a widget since it's too easy to lose in this market. Trust me when I say a lot of dealers are filled with inventory that they don't want to take a loss on but have to pay the bills so its high end and bullion atm. Exceptions are morgans for the moment and maybe a couple of other series.
It has to do with having no solid wholesale market for a lot of "stuff" so the retail prices for widgets have not gone up much if at all while the buy price is way down since were all filled atm.......

SeaEagleCoins

<< <i>Many posters have noted that buy-sell margins for numismatic coins seem to have increased over the past year.

Is the business of selling numismatic coins becoming a secondary endeavor for most dealers?

Are numismatic coins now viewed by many dealers as a pain to handle?

Is the necessity of not just having coins slabbed, but slabbed in the "right" holders with the "right" stickers driving up the cost of doing business and helping to kill interest in numismatic coins?

Have their used jewelry and bullion sales now pushed numismatic coins aside?

Comments ... >>



Don't think I can give a meaningful reply to this with a "bumper-sticker" post...

Is the business of selling numismatic coins becoming a secondary endeavor for most dealers?

First, I am not sure what you mean by "numismatic coins"... I will assume you mean "generally nice collectible pieces that fit into a collection done for education and fun"... in this case, yes for many dealers. Recently, at shows, I find myself very busy... primarily dealing in coins in the $50-500 range...slabbed and raw. Working with folks working on lower cost collections and enjoying themselves with the hobby.

Meanwhile, I see and hear of a number of "big coin" dealers twiddling their thumbs and speaking of the "slowdown" and "downturn" in the market...



Are numismatic coins now viewed by many dealers as a pain to handle?

Perhaps...it does seem so at many of the bigger shows I have attended. Many dealers want to deal in large margin/ big ticket coins... but there are still a significant number who still remember that this is a hobby with many budgets...and that those budgets can change over time.


Is the necessity of not just having coins slabbed, but slabbed in the "right" holders with the "right" stickers driving up the cost of doing business and helping to kill interest in numismatic coins?

It might not be "killing" the interest...but is sure a major distraction...IMHO



Have their used jewelry and bullion sales now pushed numismatic coins aside?

I imagine this is referring to B&Ms... if so... bullion sales are the driving bread n butter of most B&Ms... high overhead...rent, advertising, security, large commitment of time & energy demand a steady, significant profit for the store to be successful. Most bullion deals are short and sweet... while dealing with a possibly picky collector over a smaller sale can be frustrating for some...and if it only leads to a small profit... the business will not succeed.

I do not see this question having any real meaning for the show dealers, such as myself. For me, the "average" collector is my focus and serving them is the driving force of "success" for my business model.

ajman

No, I don't believe that dealers view handling coins as a pain, that's what they do, deal in numismatics. I also believe that due to the state of the economy, that dealers are taking advantage of opportunities that are presented to them, whether that consists of dealing in scrap pm's or bullion. Every day I see people selling their scrap jewelry for quick cash and other segments of the population wanting to buy and hold hard physical assets like bullion in these uncertain times. To me it's just another line in the job description of coin dealer and I think they are wise to recognize this.

Nic

The words fundamental and permanent scare me!
This is just another market cycle. Didn't you predict it several years ago?

K

abitofthisabitofthat

I spoke to one dealer who did feel this way, sort of. His phrase was that he felt, as of a year or two ago, that he got fired as a rare coin dealer, and rehired as a bullion dealer - at twice the salary. But he said it a bit wistfully.

291fifth

<< <i>The words fundamental and permanent scare me!
This is just another market cycle. Didn't you predict it several years ago?

K >>



Being "Mr.Negative", yes I did predict it. However, I am not sure that this downturn is like others in my lifetime. Being in the Detroit area I see the impact of the collapse of Chrysler and General Motors. (I am not convinced that either of the new entities will survive.) Good jobs, both white and blue collar are disappearing in huge numbers. Where is the money going to come from for discretionary purchases like numismatic coins?

291fifth

<< <i>I spoke to one dealer who did feel this way, sort of. His phrase was that he felt, as of a year or two ago, that he got fired as a rare coin dealer, and rehired as a bullion dealer - at twice the salary. But he said it a bit wistfully. >>



Most coin dealers, if given the choice, would stick with numismatic coins. This is what most of them actually like. Unfortunately, for many brick and mortar dealers, numismatic coins are not paying the bills. Jewelry and bullion are paying the bills and, of necessity, are where dealer efforts are now directed.

MrEureka

One or more of the comments in the OP is true to some extent for most dealers.

But for the majority of dealers, it's more or less "business as usual".

Bear

Hard to say in a soft market. Collectors are becoming

more discriminating and more demanding of more coin

for their money. We will probably have to wait for the

next up cycle to judge if profound changes are occurring

within the coin industry. What is for certain, a sizable number

of dealers will not be in business when this recession finally

ends.

DHeath

We tend to always believe we are at the end of an evolutionary process, when in fact we're in the middle. I am always astounded things will never be the same. I wonder if transaction costs will create a resurgence in raw collecting.