Inflation Impact on Coin Returns

itsnotjustme

Have you ever considered the economic cost of holding coins across long periods due to inflation?

Quick Facts based on the CPI change.

The original $20 face of a 1904 Liberty Double Eagle would inflate to $529. While well below the value of a circulated piece today, the gain is far less than it appears at the surface.

$100 face of common silver in 1964 would have an inflation indexed value of $789 today. Again, below the melt value of $1,186, but a far lower gain than it appears on the surface.

And $100 of common wheat cents collected in 1964 looks like a big loss, as there is no realizable metal gain. The inflated value is again $789. I don't see 8 cents each for common wheat cents.

I know most of us have not held such coins for these periods, but someone has always owned all the coins still around today.

Link: in2013dollars.com/1964-dollars-in-2017?amount=100

Insider2

True collectors are not interested in appreciation. You cannot put a price on satisfaction, research, and enjoyment. In the past, some folks have done very well with coins.

Even buying junk silver can have a purpose other than making a profit.

ctf_error_coins

I do not like inflation arguments as there is no accounting for a smart phones , internet connection, computers, high end digital cameras, etc .....

ricko

Inflation is a numbers game... very real of course, but meaningless to the young and horrifying to the old. Cheers, RickO

amwldcoin

Inflation = means for government to collect Capital Gains Tax!

ctf_error_coins

So, my little plastic kayak that I bring out into the pacific ocean has a $500 Fish finder that has Sonar and also has GPS tracking tied into satellites. How much would that have cost me in 1964?

amwldcoin

That's like comparing how much a hot woman costs when she is 20 vrs 60!
Tech advances are out the window when it comes to inflation. My 1st computer setup cost me over $4,000 in 1998. Better by far set up now would probably cost $12-1500.

@ErrorsOnCoins said:
So, my little plastic kayak that I bring out into the pacific ocean has a $500 Fish finder that has Sonar and also has GPS tracking tied into satellites. How much would that have cost me in 1964?

Overdate

@Insider2 said:
True collectors are not interested in appreciation.

Some are and some aren't. A person doesn't have to be a "purist" who totally disregards the coin marketplace to be a true collector.

Overdate

In 1964 a BU roll of 1950-D nickels cost $1,200. That's $10,000 in today's dollars. Today it costs about $300. In real terms it has lost 97% of its 1964 value.

In 1980 a common-date BU roll of Walking Liberty halves cost $4000. That's $12,000 in today's dollars. Today it costs about $500. In real terms it has lost about 96% of its 1980 value.

The coin market can be just as prone to bubbles as the stock market.

Peace_dollar88

Interesting!

rooksmith

And $100 of common wheat cents collected in 1964 looks like a big loss, as there is no realizable metal gain. The inflated value is again $789. I don't see 8 cents each for common wheat cents.

IMHO wheat pennies in low grade that are worth only melt values have not kept up with inflation. Rarity and scarcity seem to be the only thing worth collecting. Hoard the Keys! and hopefully the Mint will stop making the awful zinc-filled pennies in 2023, which should make people think about cashing them in for their melt value. That would be good for coin collectors, and might just reignite the popularity of trying to complete a mint/date set of Lincolns.

rooksmith

@amwldcoin said:
That's like comparing how much a hot woman costs when she is 20 vrs 60!
Tech advances are out the window when it comes to inflation. My 1st computer setup cost me over $4,000 in 1998. Better by far set up now would probably cost $12-1500.

huh? ;-)

MasonG

@Insider2 said:
True collectors are not interested in appreciation. You cannot put a price on satisfaction, research, and enjoyment.

From someone with over 14,000 posts? If you say so.

Unknown

This content has been removed.

silverpop

why worry about something one can't control?

JimW

@Insider2 said:
True collectors are not interested in appreciation. You cannot put a price on satisfaction, research, and enjoyment. In the past, some folks have done very well with coins.

Even buying junk silver can have a purpose other than making a profit.

I recently bought a Washington 25c album (silver issues) that was about half full (39 coins I think). I went to my junk silver quarters and filled 26 more holes

cameonut2011

It means coins will be even worse investments. Prices likely won’t keep up with inflation even if prices rise nominally and you may have capital gains taxes to pay to boot. Factor in high auction house fees, and you eat up much of the sales price.

Catbert

5 year old thread

jmlanzaf

@Catbert said:
5 year old thread

But still relevant. Personally, I appreciate people resurrecting threads rather than starting redundant threads.

Catbert

I'm cool with it too, but it is nice if the resurrector would add to the discussion AND note that it is an old thread renewed.

ms71

@Insider2 said:
True collectors are not interested in appreciation. You cannot put a price on satisfaction, research, and enjoyment. In the past, some folks have done very well with coins.

Even buying junk silver can have a purpose other than making a profit.

I wouldn't say that lack of interest in monetary appreciation makes one a "true collector". I learned after paying substantial "tuition" in this hobby, that what I really wanted was the enjoyment that came from ownership; not the prospect of monetary gain. I certainly can't claim to be any "truer" a collector than anyone else.