Collectibles Value

JCMhouston

Interesting article on values of collectibles as alternative investments, coins were number 3:

Linky

Zohar

Will be interesting to monitor the trends and correlation to paper assets.

pruebas

But we've known most of this info for years, right...?

Edited to add: When your shoeshine boy (or in this case, the mainstream media) starts to give investment tips, it's time to sell those assets.

Zohar

<< <i>Edited to add: When your shoeshine boy (or in this case, the mainstream media) starts to give investment tips, it's time to sell those assets. >>



Do you see the coin market declining? If so, other than the "generic" statement regarding the shoeshine boy, what are the drivers you see for a decline. I have been trying to figure out the supply and demand side of this business and have not been able to as opposed to other markets. The run up during 2008-2010 when everyone was running for the hills and flatness I am sensing now.

JCMhouston

Actually I have long believed what preubas says, when the rest of the world is saying get in, it's time to get out.

Having said that I don't invest in coins, I collect. So market moves on the downside make me happy I can pick up things I want/need at a lower price. But I believe we'll continue to see more of the same over the medium term, the really good or rare things skyrocket, the average and common things continue to drift down.

Zohar

<< <i>Actually I have long believed what preubas says, when the rest of the world is saying get in, it's time to get out. >>



Is the rest of the world saying to get in? How many people do you know that are getting into coins? How often does this come up in business discussions as a great opportunity? My concern has been a decline in collectors rather than increased interest. Going to the NY show, I see very few people in the 20-40 year old group.

pruebas

Do you see the coin market declining?
No, but I don't believe most people saw the stock market decline coming in late 1929 or 2001 either.

Is the rest of the world saying to get in? How many people do you know that are getting into coins?
Not many, but those who buy via internet are not visible to me except indirectly as the run-up of prices. Something is causing the prices to escalate. I believe it's more money chasing coins, not more people chasing coins.

That said, I am not selling, and am in fact buying. But I'm often using profits from coins that have increased in price, so to me, it's a wash. But what I collect is so rare that these coins only come up for sale when prices are high.

Zohar

Thank you.

coinkat

I am more concerned about demographics than anything else. I think that may effect the US market more than the world coin market. I think the world coin market will out perform the US market based on demographics and rising middle classes in various countries. Further, the US market is mature and there is still much to learn and appreciate with world coins as to rarity, condition rarity, surviving population and varieties.

Zohar

coinkat - that is something I didn't think about. Are US coins broadly collected outside the US ? One indeed has to assume that more supply will come to the market as collectors age.

SYRACUSIAN

Coincidence?

This is one of the books I ordered yesterday:




The handbook of alternative assets

nicholasz219

My stepfather had a long unpleasant conversation with an "investment grade coin advisor" which of course was total crap a few weeks ago. He called to see a price on a coin he wanted to get a feel for where things were (he collects US gold). After a long miserable conversation where he indulged the salesman and let the guy tie himself in knots about their return policies and what coins exactly he was getting, he let the poor bum go. But there is considerable marketing going on in the retirement communities in the US (Mom lives in Arizona some of the year) to people with money and not a whole lot of knowledge. Considering that there were concerns about the value of the dollar, yields on Treasury securities and the stock market recently, and as always, I feel that these companies have a lag time of at least a few months if not a year before they start pitching to the mass market much like the Home Shopping Network does. It's mostly worthless crap in terms of common date Morgans and gold in blah 61-62 grades sold at inflated prices. The company in question has managed to keep a favorable rating with the better business organization in their town but only because all complaints are refunded with a full refund of purchase price, albeit with store credit. This causes minimal loss and ensures another shot at the potential mark. Still, the complaints are there because folks belatedly smart enough to realize that they have been had call the company out on it.

I feel that a lot of the investor money in US coins especially goes to large lots of relatively common junk like this and marquee pieces only drive interest when they sell for millions. There are only so many rare pieces as you know and since serious collectors hold on to them typically saying the market is "illiquid" at best is probably a huge understatement. Unscrupulous dealers claiming that the Morgan dollars they are selling have that same potential technically are correct if 99% of the mintage suddenly was thrown into a volcano and the pieces that you had happened to be among the last ten on Earth.

I feel that this phenomenon shows that dumb money always goes to dumb places and this movement is led by the folks that stand to profit the most. I was told long ago by my first dealer friend that you collect because you love collecting and if you buy the stuff you love and buy the pieces that really are great whether they are $10 or $10,000 to buy, you will always find a solid market for good coins. But like the mortgage securities that were the tectonic plates of the violent market earthquake a few years ago, the coins these "investor advisors" are hawking are overpriced and anything but rare.

It's like my grandpa who used to buy me a proof set every year as part of my Christmas present. He started me in coins and as I got older, he worked to keep his connection to me through this one simple purchase that marked the passage of time. I liked it and still do. Occasionally he would buy me a commemorative coin that commemorated an event that interested me as well. For us it was personal and I still appreciate what he has bought me and plan to give all of it to my daughter as part of his legacy to her. But the folks I hear at shows who say that they have some stuff saved for their kids and it is like BU rolls of 2010 Lincoln cents I just silently pray that this is not their only investment strategy.

Sorry, this struck a nerve.