Question for the modern coin market makers or breakers.

Coin Finder · January 2, 2014 4:35AM

I read somewhere that modern coins that are considered low mintage and thus "rare" are on a 5 year cycle. In other words, they take about 5 years to mature in their true market value. Is that still true? Or does it depend always on demand?

What causes demand to change from low to high demand for a modern coin?

Thanks!

Bochiman · January 2, 2014 4:37AM

Wondercoin may be one of the best to answer this....

dollarsandcents · January 2, 2014 4:41AM

It's always supply and demand. Not sure what you mean by a "5 year cycle." The laws of supply and demand are always in-play.

What causes demand to change? Could be anything: tastes, collecting habbits, interests, whatever.

wondercoin · January 2, 2014 5:21AM

Thebigeng: First, the vast majority of modern coins sold by the US Mint annually are not only NOT "rare" but are very, very common. So, the "trick" is to try to identify the small percentage of modern coins that may become the "modern rarities" down the road in five years, or even ten or twenty years.

Just like classic coins, there may be "absolute modern rarities" and "conditionally rare moderns". There is quite a bit of talk on the boards right now for example about the 2013 MacArthur $5 Gold Commem MS (with a possible mintage of roughly 5,700 or less) that sold out five days ago. I remember back in 1986 how incredibly popular and collectible the Statue of Liberty $5 Gold Commem Mint State coin was at the time with its 95,000+ mintage (as I chased around the coin shows trying to buy them)! Obviously, that coin is nothing more than a common $5 Gold Commem 25+ years later. But, will the 5,700 or less mintage on the MacArthur $5 Gold Commem be just the opposite result in 25 years time? You gotta love the 5,700 mintage, which is why the coin is up about 50%-100% in a week from the $400 Mint Issue Price! That sure did not take 5 years ... repeat it took 5 days to nearly double in price! Where will the coin be in 5 years? Who knows, but I certainly liked the coin's chances at $400 a week ago. Likewise, a set that has not been discussed nearly at all thus far is the 2013 Generals Profile set that had a 50,000 authorized mintage and it appears the Mint sold less than 11,000 when the "dust settled" three days ago. This is a very low mintage on an interesting specialty set. but will collectors pursue these limited edition sets in the years to come or not care about them? That was the "$74.95" question earlier this week when anyone could have stepped up a bought some or all of the 39,000+ unsold sets (and it appears very few folks seemed to care about it).

And, then there are conditionally rare moderns. For example, the relatively low mintage 'S' Mint quarters in 2012/2013 ... try finding them in MS68 grade. They are like a "needle in a haystack" as the esteemed (classic guy) "Oreville" discovered when he set out to grade some MS68's at the last FUN show with my daughter Lauren (he did find some MS65's though!) The demand for coins such as these might very well grow over a 5 year cycle (or even 10 years).

Just a quick comment and I look forward to reading the responses of other boards members. As always, just my 2 cents.

Wondercoin

NeoclassicalAnalyst · January 2, 2014 5:26AM

Collecting modern coins is like playing a coordination game. You need to have some focal point (aka Schelling point) for people to coordinate on. In most cases, low mintage serves as focal point for coordination. Just a game-theoretic perspective.

BillJones · January 2, 2014 5:27AM

My view with a lot of moderns is that they often a high price period within the first five years (often sooner, if they amount to anything. Most are dead from the get-go.) and then level off or decline later. With many moderns, "flavor of the week" (Actually longer than that.) or "out of sight, out of mind" applies.

P.S. I bought one of "flip chart" generals sets as a collector because I have enjoyed mint sets like this, and I wanted the MacArthur medal which was a bronze copy of the gold medal that Congress awarded to him in the early 1960s. Given the fact that the combined issue prices for the half dollar and the dollar were almost equal to the price of the "flip chart" I decided that it was a decent deal.

Coin Finder · January 2, 2014 5:57AM

Thanks Mitch! And to all who have responded so far.

wondercoin · January 2, 2014 6:14AM

Bill Jones: You are making some good moves with the moderns these days!

I like the Generals set as well. It should be interesting to see what those medals trade at if and when they begin getting graded at PCGS.

Wondercoin

Overdate · January 2, 2014 6:32AM

I think it's the economy, more than anything else, that is keeping demand levels, prices and mintages down for many moderns. Many collectors/investors would have bought more of these coins from the Mint if they had been able to afford them.

Eventually the economy will recover, and demand and price levels for many of today's low mintage coins will increase. It would not take many newly interested collectors to overwhelm the available supply of modern coins with mintages in the low to medium four figures.

coinhack · January 2, 2014 8:30AM

I believe the lack of demand is that few people collect the coins as a set. I do. I have all of the modern silver dollars in proof and uncirculated. In addition, I added the Bi-centennial Ike dollars and the 1900 Lafayette dollar making a complete type set of U.S. commemorative dollars. It makes a set of over 130 different types now. There are some very attractive designs and some interesting themes. I like it but in the 5 years or so I have been reading this forum I have only seen one other member admit that he collects the whole set. Same thing at shows. I have talked to maybe 3 other people that had an interest in the coins as a set.

So the demand is diluted because people generally only buy a design that they are attracted to and ignore the rest of the set. The fact that you can by the key dates in nearly perfect proof or uncirculated condition with mintages in the 14,000 to 16,000 range for around $200 each tells you that there are few set collectors.

Supply on the other hand is kind of interesting. When I first started collecting these coins 4 or 5 years ago I could go to a larger show like Long Beach and go home with two dozen different new coins. And there were a couple larger national dealers that kept a complete inventory of them. Putting together a set was just a matter of shelling out the cash. Not so much now. I see these coins here and there but no one has large inventories of them. This may also be due to the fact that they are a slower moving inventory but nevertheless they are not around in abundance.

From my own experience I know I can go through a show and find many more 1893-S or 1889-CC Morgans than I can the Atlanta Tennis, High Jump or Wheelchair commemorative dollars.

Off now. Going to go to the mint site and buy the new Civil Rights dollars. Keep the set up to date...

derryb · January 2, 2014 9:50AM

Modern mint product resell prices are determined by three things: mintage, TPG opinion on quality, and speculators. Of course you need a fourth ingredient - a buyer.

Coin Finder · January 2, 2014 9:58AM

Very interesting comments thank you.

jmski52 · January 2, 2014 10:24AM

So the demand is diluted because people generally only buy a design that they are attracted to and ignore the rest of the set. The fact that you can by the key dates in nearly perfect proof or uncirculated condition with mintages in the 14,000 to 16,000 range for around $200 each tells you that there are few set collectors.

Supply on the other hand is kind of interesting. When I first started collecting these coins 4 or 5 years ago I could go to a larger show like Long Beach and go home with two dozen different new coins. And there were a couple larger national dealers that kept a complete inventory of them. Putting together a set was just a matter of shelling out the cash. Not so much now. I see these coins here and there but no one has large inventories of them. This may also be due to the fact that they are a slower moving inventory but nevertheless they are not around in abundance.

Coinhack, those are some interesting observations. It would appear that the Commem Silver Dollars are following the same trajectory as the Classic Commem Half Dollars did in the 1960's. You may have a coveted set on your hands as time goes by.

Cougar1978 · January 2, 2014 10:45AM

I like mods as a quasi bullion investment and have around 200 pieces in my bank box as investment (Silver Dollars and Gold coins). I recently purchased a few MS 70 $5 2013 AGE's from Apmex for around $157 each. The CU price guide lists them at $260, not a bad deal. I also liked their 2013 PCGS 69 ASE's at $33.12 which is not bad considering what it would cost one to slab these if purchased raw.

Question for the modern coin market makers or breakers.

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