2016 Market Summary

Zohar

Thoughts? Could be lack of major collections coming out in 2016 compared with prior years or collector base demographic shrinkage.

https://coinworld.com/news/us-coins/2016/12/rare-coin-sales-in-2016-tops-four-billion-dollars.html

coinworld.com/voices/bill-gibbs/2016/12/is_a_smaller_coinma.html

coinkat

Too many auctions
Too much of the same recycled material
Seems rarity can be a moving target on the world stage... Condition rarity verse absolute rarity and the demand for such coins

MrEureka

The numbers are based on sales by US auction firms, which means mostly US coins. For US coins, the numbers were off because fewer coins were offered, and those that were offered sold at the new, lower market levels. As for why the market was lower, I would say it was just a continuation of a downward trend in rare coins and bullion. Fundamentally, nothing much really changed. As for the world coin market, I'd say that the same was true, but to a much lesser degree.

pruebas

@coinkat said:
Too many auctions
Too much of the same recycled material
Seems rarity can be a moving target on the world stage... Condition rarity verse absolute rarity and the demand for such coins

While this may be partly true, I always seem to find fresh, interesting material to buy, even though my tastes are rather esoteric. I lack enough money to buy everything I like rather than the other way around.

I think it's just a simple matter of fewer people chasing material that has gotten too expensive and now prices are adjusting downward with lower demand. In other words, the economic cycle.

YQQ

Happy New Year to all,

interesting to read you fellows comments.
However, every European Auction house is reporting record prices way beyond their expectations.
what do they know that the US auctioneers do not know?

Zohar

They sell world not US material

marcmoish

MrEureka Posts: 20,000

as of this morning..congrats Andy (cheers emoticon here)

@YQQ said:

Happy New Year to all,

interesting to read you fellows comments.
However, every European Auction house is reporting record prices way beyond their expectations.
what do they know that the US auctioneers do not know?

this might have to do with the fact that many are now selling slabbed goods or at least have a number of slabbed lots in each sale that are commanding higher prices.

worldcoinguy

I would love to see a breakdown of those macro numbers by volume at each price level.
< $500
$500 - $2500
$2500 - $10,000
$10,000 - $50,000

$50,000

ShadyDave

US coins are "mature" while many world coins are not.

MrEureka

@marcmoish said:
MrEureka Posts: 20,000

as of this morning..congrats Andy (cheers emoticon)

I hit 20K something like three years ago!

marcmoish

I don't know Andy - count now 20,001 after you just responded
MrEureka Posts: 20,001 ✭✭✭

Zohar

So the annual question... are new collectors being created to support phasing out of older collectors or will the hobby experience the fate of stamps.

Zoins

@Zohar said:
So the annual question... are new collectors being created to support phasing out of older collectors or will the hobby experience the fate of stamps.

There were some numbers posted in the US forums recently. Decline before the 1999 US Statehood Quarter program. After that, a huge increase, but we'll need to see if those people stay in the hobby.

More recently, not sure.

A number of countries are essentially going cashless:

• It's not all about the money: 10 countries that have almost gone cashless
• Top 5 Cashless Countries

coinkat

I do not favor nor will I ever favor a cashless society.

brg5658

I'm not completely sure what these (CoinWorld) opinions of the US coin market have to do with the health of the World Coin market. Two completely different beasts.

I think the US coin market has been over-hyped and much of the material has been over-valued/over-priced for years; 2016 may be the first we've seen of some long overdue correction downward. Sure, the uber-gems will still be scarfed up by the uber-wealthy like they always have been, but eventually some of the dealers are going to have to lower the prices of their trinket Morgans in their cases.

neildrobertson

@Zohar said:
So the annual question... are new collectors being created to support phasing out of older collectors or will the hobby experience the fate of stamps.

I don't think coin collecting will ever experience the fate of stamps. Even at its peak, stamp collecting was not at the same level as coin collecting.

All signs point towards a lack of growth in coin collectors (if not attrition). Coin prices have been flat or up for over 20 years but they've been going down if you account for inflation. ANA membership has been slowly declining recently. Even in times when the total numbers of collectors haven't decreased, it's failed to grow at the rate of the population in general. I think there's a lot of competition for people's attention these days. The average person has an unprecedented amount of choice with the access the internet gives us. I personally hope that the number of classic US coin collectors decreases over the next 10 years so that I may have a (financial) shot at being able to collect US classic coins at some point in my life.

neildrobertson

@brg5658 said:
I'm not completely sure what these (CoinWorld) opinions of the US coin market have to do with the health of the World Coin market. Two completely different beasts.

I think the US coin market has been over-hyped and much of the material has been over-valued/over-priced for years; 2016 may be the first we've seen of some long overdue correction downward. Sure, the uber-gems will still be scarfed up by the uber-wealthy like they always have been, but eventually some of the dealers are going to have to lower the prices of their trinket Morgans in their cases.

I'm not sure if it's the first we've seen. If I adjust the PCGS3000 Index (or a number of the other ones) for inflation, it has been going down for a long time...it may be even more rapid now. Only the rarities index has seen any appreciable growth in the last 20 years, which is where we'll probably see the biggest dip.

Looking at these trends my mind is constantly boggled by the amount of inventory some dealers carry. In a flat or downward trend, it makes no sense to hold inventory as long as they do. It makes a bad situation even worse (see Sunk Cost Fallacy).

SYRACUSIAN

I'll tell you what I've noticed. Top pop rarities and more often condition rarities have truly skyrocketed in Greece. Prices of gem rare silver 19th century silver crowns have doubled, if found, and a lot of fresh, top class material has been seen since this never ending financial crisis started has shown up, A lot of it in the hands of a few savvy local dealers with good leads, at often crazy prices, unheard of before the crisis, nine years ago, directly to some buyers who prefer to keep their anonymity. Every body wants to keep his anonymity nowadays in Greece but it's much easier said than done. Fresh cash has entered this top class coin category too, solely as investment which had had a swift upward trend in so many very rare 19th century Greek gems of all metals.

This was undoubtedly one of the reasons I've temporarily switched to the still untapped up until three years ago (market of) scarce and rare paper money from that period and country. Now currency too has seen a lot of newcomers with deep pockets with rare certified nice fresh stuff disappearing at record prices with each passing day. In the middle of this unprecedented crisis and spiral backwards and often to bankruptcy and poverty, along with ever increasing overtaxation, now reaching levels above seventy percent in many cases, coins seem to be one of the very few still undetected ways to invest any amount of money someone wishes to, among those who still have it.

Zohar

We need to also consider the commodities impact. Many dealers took a major beatup in the gold/silver drop 4 years ago. Imagine sitting on $1MM inventory of spot gold which loses 40% of its value and remains there for 4 years... that's $400k less to replenish inventory and much caution as to which price points to pursue. Now if this market would eventually stop or reverse its run up from a Dow low of 7K to almost 20K, it may revive the metals/coin markets. I recall 2008-2011 being a relatively strong market for world coins.

JohnnyCache

I think there will always be people who have a love of history. Coins allow us one way of connecting with that history.

It is also the case, unlike stamps, that many coins hold some intrinsic value due to the precious metal content and I believe that there is, and has always been, a strong crossover connection both ways, between those who wish to hold PM's and those who collect coins.

Additionally, like great works of art, I believe that the very strongest coinage in the market today has nothing really to fear. There will always be Uber-rich people with lots of disposable income. However, I'm not as confident, in the long run, with regard to less revered coins, typically bought by those of us with more typical means.

Can coins in the $1,000 to $12,000 range, which I think are, on average, bought by "middle class" buyers (a loosely defined term no doubt) continue to hold their value?, Or will, as this middle segment of the coin collecting population continues to shrink, the coins these collectors purchase have their valuations shrink right along with them?

I think it's a fair question given, what I see as, an increasing burden on the typical financial demands of today's "normal" middle class family lifestyle and today's perceived priorities.

What I'm trying to say is that, just 40 - 50 years ago, not all middle class families had two cars plus maybe a car or two for the older teens kids. Many didn't take yearly getaway vacations. They didn't have the very high expenses of the college educations we have today, in fact not all children went off to college automatically 40 or 50 years ago as they do today. They likely didn't have the same kind of worries over 401k's and investment savings that today's families have, as pensions were still the norm. Also modern day conveniences that we take for granted, such as cell phones, cable tv and the internet didn't exist so they weren't drawing off financial resources. Most families probably did not frequently eat out, today it's almost the other way around, most don't cook. They either eat out or bring prepared into the home, which equates to higher food costs. Hell even just the ubiquitous daily coffee purchase can add up over a years time.

Yes, it's true that back then many were living off of only one income, whereas, in today's world there are frequently two income earners in the middle class home. but my point is that there are far more things that are eating up your expendable free cash today.

Additionally, although I think coin collecting was a great way to immerse yourself into history and research through reading, cataloguing and just organising a collection, today there are seemingly many more things that are vying for a person's (limited) free time and attention.

Finally, the biggest obstacle may be that of the mindset of today's culture. It very much revolves around cheap disposable things and instant mindless gratification.
I believe, the public at large, if given the choice between being awarded a $2000 visually attractive and historically interesting coin or having the same $$ go towards a new super sized flat screen television, the outcome would be wildly lopsided, with 99.99% going for the television. Even if you explained the the T.V. would be absolutely worthless in 5 years time and the coin could have a good chance of holding or increasing in value in that time frame.

I've tried to get my own children involved in the love of coins for many years now with limited success. Maybe twenty years from now they will be slabbing cell phones instead of coins.

I can hear it now, "I've got sixteen hundred for the motorola razr flip phone in bright red who'll give me seventeen"