How does the recent auction of the 1907 UHR $20 LE PCGS PR69 represent a strong market?
scoobydeux
Posts: 498 ✭✭
Please help me to understand...
This coin sold for $2,990,000 in 2005, see here:
Heritage
Now just 2 days ago, the coin sells for $2,760,000 (2.4 + 15% buyers fee) here:
Stacks/Bowers
So, in 7 years the coin loses $240,000.
Bad enough, but when one considers the approximate 50% devaluation of the dollar during this period (see below)...
...the loss is exponentially magnified from an 8% numeric loss (240,000/2,990,000 x 100) to a 54% loss in actual value (100 - [(2,760,000/ 2,990,000 x 2) x 100]).
And so, to the original question: how does this recent sale reflect a strong current market in numismatics?
This coin sold for $2,990,000 in 2005, see here:
Heritage
Now just 2 days ago, the coin sells for $2,760,000 (2.4 + 15% buyers fee) here:
Stacks/Bowers
So, in 7 years the coin loses $240,000.
Bad enough, but when one considers the approximate 50% devaluation of the dollar during this period (see below)...
...the loss is exponentially magnified from an 8% numeric loss (240,000/2,990,000 x 100) to a 54% loss in actual value (100 - [(2,760,000/ 2,990,000 x 2) x 100]).
And so, to the original question: how does this recent sale reflect a strong current market in numismatics?
"Discipline is never an end in itself, only a means to an end."
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Fellas, leave the tight pants to the ladies. If I can count the coins in your pockets you better use them to call a tailor. Stay thirsty my friends......
<< <i>the approximate 50% devaluation of the dollar during this period >>
I don't even know whether or not to take this thread seriously when you offer this as fact.
-Paul
<< <i>
<< <i>the approximate 50% devaluation of the dollar during this period >>
I don't even know whether or not to take this thread seriously when you offer this as fact.
-Paul >>
Hey -- didn't you see that (unattributed) chart? Statistics don't lie!
Coin Rarities Online
Experience the World through Numismatics...it's more than you can imagine.
I'd be careful using a single commodity (gold) to measure the so-called 'devaluation of the dollar' during the timeframe that you mentioned.
Has the price of consumer goods risen 50% in the last 7 years (2005 - 2012)? How about a pair of Levi's jeans? A loaf of bread? Head of beef? What about industrial goods? Wages? Oh, and let's not forget real estate! Arable land?
The change in the CPI-U from 5/05 to 5/12 was 18.22%, not 50%.
And this coin is hardly representative of the market as a whole!
There are so many problems with the OP that it's hard to know where to begin.
But I'll see your example and raise it with two of my own:
I just paid over $300k for a coin that sold for just over $200k in 2007. That's nearly a 50% INCREASE in 5 yrs. Yes, the coin was CAC stickered.
How about $1,380,000 for this coin? I don't have the price realized from 2004 handy, but IIRC it's on the order of $300k meaning an approximately 400% INCREASE in 8 yrs. Yes, the coin was CAC stickered.
Someone likely overpaid for it a decade ago because they were more concerned with the plastic than the coin itself. No conclusion can be drawn from this single data point and projected to the market as a whole.
If I buy a coin for $100 on ebay, and sell it a month later at a show for a loss of $50, does that mean that the market dropped 50%? Your analysis would assume so.
merse
Mea culpa--my example of the dollar as valued in comparison to gold was not the example that I should have used. My point was, simply, that the dollar is worth less than in 2005, and that this should be considered as part of the equation.
I had no intention of focusing on CAC in starting this thread, and was unaware that this coin did not CAC sticker.
But in truth, the OP was meant in a rhetorical fashion--obviously, the sale of a single coin cannot reflect the entire market. Furthermore, it would be awkward and contradictory to say that a decrease in the price of single coin would represent a strong market coin market, as has been recently asserted in some coin reports of the Baltimore show.
<< <i>I don't think you can draw a conclusion one way or another based on one coin that has only a handful of potential buyers. This is especially true on a coin that most felt was over graded and perhaps not actually the best of breed. MJ >>
This.
<< <i>The dollar fell 50% against gold. The more important question is, how did the dollar perform against things you actually need to survive, like food and shelter? Seems to me that a dollar today buys a lot more real estate than it did 5 or 10 years ago. >>
Did the dollar fall against gold or did gold rise against the dollar? I'm much more inclined to believe gold has simply risen agains the dollar due to speculation and a surge of international demand. Real estate, on the the other hand, has simply fallen against the dollar due to a lack of demand for real estate. There is no inflation until money gets spent, and money is not being spent. If anything, we're more in a deflationary position right now in my opinion.
<< <i>I don't think you can draw a conclusion one way or another based on one coin that has only a handful of potential buyers. This is especially true on a coin that most felt was over graded and perhaps not actually the best of breed. MJ >>
I'm bit surprised that this coin was regarded as over graded. I saw a small scratch across Ms. Liberty's mouth which I suppose should have dropped it to PR-68 if you apply the same standards to this as you do to modern Proofs. I didn't see anything else wrong with it. I was of the opinion, however that the other big coin, the Stella was over graded by as much as two points.
As for the sale of one coin, I don't think you take that as a major indicator of the market. There are only a few players when you talk about coins that sell for more than $2 million dollars. All it takes is for one or two of those guys to sit it out, and the hammer price will be lower.
TDN's examples are showing some series are on fire, while a Proof $20(1885) that Legends got out of the Baltimore sale by Stacks brought 50% less than the coin was being offered at 2 months ago. A great bargain that created little interest at the time of the auction.
A $4 stella in high grade didn't sell, and a pop 1 MS 67 lib nickel( 1899) failed to meet reserve in a sale where Proofs went wild.
2 ED's in MS 63 and 64 failed to sell recently, ( Stacks Baltimore), and an 1888 lib nickel( fab toning) sold for about the same price it garnered 6 years ago.
So, the recent sale of the UHR for 10% less than it brought 7 years ago is simple-- as others said, it may have been overgraded, and the buyers were not excited this time around. Funny that it was being offered by the owner/dealer for over $5 million for 7 years and didn't get a bite at that level. No one should be surprised it didn't get moon money--it was around too long without any super interest
As long as TDN holds on to his poker money, he will continue to make more discriminating purchases. Would he recommend a CAC PR68 to a friend as a better deal? I hope not. It's irrelevant in this instance.
I'd imagine there's not an 1804 S$1 that would get a green bean, but ......
Fred Weinberg has an interestingly silly story to tell about the money he lost on the Extremely-High Relief in Eliasberg.
"Come on man".
3 million lost 18% buying power over the past 6 years
The opportunity cost of parking 3 million in a dead investment like a coin rather than muni bonds was at least another 1 million dollars
The original buyer may have overpaid for one extra point and would have been better off with a PR67 or 68 coin, but most serious collectors realize that there is no million dollar value in that last point when the grading and beaning companies are inconsistent anyway.
Commems and Early Type
Oops, looks like this point was made in the post above me.
<< <i>I think there is a point to be made here despite the piling on the OP got...
3 million lost 18% buying power over the past 6 years
The opportunity cost of parking 3 million in a dead investment like a coin rather than muni bonds was at least another 1 million dollars
The original buyer may have overpaid for one extra point and would have been better off with a PR67 or 68 coin, but most serious collectors realize that there is no million dollar value in that last point when the grading and beaning companies are inconsistent anyway. >>
Thank you. You have articulated my thoughts precisely, and in a more articulate and concise manner.
<< <i>... Fred Weinberg has an interestingly silly story to tell about the money he lost on the Extremely-High Relief in Eliasberg.
Any chance of getting him to tell that story here? I see the Eliasberg one is in the Bass Foundation collection. What could go wrong? Overbid a clients maximum level or bid on the wrong lot? I would guess it is even more interesting than those.
Regarding the auction prices on this just sold 1907 UHR, the $2,990,000 2005 price seemed very strong being nearly 3 times what any had auctioned at before. Heritage sold a PCGS Proof-68 a little more than a year later for $1,840,000. So one particular coin bringing less than it did before may be difficult to judge a market by.
"To Be Esteemed Be Useful" - 1792 Birch Cent --- "I personally think we developed language because of our deep need to complain." - Lily Tomlin
<< <i>ColonelJessup wrote:
<< <i>... Fred Weinberg has an interestingly silly story to tell about the money he lost on the Extremely-High Relief in Eliasberg.
Any chance of getting him to tell that story here? I see the Eliasberg one is in the Bass Foundation collection. What could go wrong? Overbid a clients maximum level or bid on the wrong lot? I would guess it is even more interesting than those.
>>
Fred has no PM function, so I posted in the hope he might be lurking and catch the thread. No fortunes were made or lost, no bids were mishandled. Not a major story, but it partially illustrates a point. More a personal vignette that he participated in and that, since he was involved, he would tell better than I.
Sorry to raise expectations. I did say it was "silly".