When a market bottoms...
MrEureka
Posts: 24,347 ✭✭✭✭✭
Just a not-so-random thought: When a market that truly sucks hits bottom and turns back upwards, it still truly sucks. Just not quite as much as the day before. So don't expect a lot of smiling faces.
Andy Lustig
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
4
Comments
That same thought came to me as I was contemplating seppuku yesterday. But I thought back to and was inspired by that old British Navy maxim "The beatings will continue until morale improves"
That is relative to ones entry point.
This is why I also have other hobbies. Call me a dilettante.
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
Colonel...I have a very nice 15th century Wakizashi I could lend you...but you'd likely get it all messy. Lol!
At least if you bought the day before, sellers should at least feel pretty good about the market.
There'll be a nice oban in my pocket to pay for PCGS Restoration. Just stand behind me and swing fast. And I hope your aim is better than mine.
CJ,
Have her pay for the white kimono.
Say a few sharp words to LS---she won't miss.
Alternatively, write and publish your tell-all book first. You'll have plenty of offers to serve as your second.
You'll need to compose a poem. And line up a motley crew to serve as witnesses.
PCGS Restoration? Get slabbed in clear lucite. Ask to go on display with one of Gunther von Hagen's anatomy exhibits.....
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
Buyers market.
This means that as a buyer, or a collector, you should be pretty happy.
I recall when I started collecting in 1972, my goal was to put together a 20th Century type set. The Barber Half was the most expensive coin and by 1976 a uncirculated example was $500 to $700. This was for an average unc, about what a MS62-63 would be today. I ended up getting what would be an AU58 today for $400. The prices and demand for the uncs was going up and I couldn't find one in my budget.
According to the Bureau of Labor Statistics, $400 in 1976 has the buying power of $1716.91 today.
Today you can buy a coin similar to what I settled for in 1976 (Barber Half AU58) for about $400. If you want a true MS coin, you will have to pay $900 or so.
You can look at it two ways:
1) The coin has not preformed very well and has been a terrible investment.
2) The coin is stupid cheap and this is a great time to collect these coins.
Is that the 'secret life' of LS?????
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
Younger generation has little interest in collecting coins, and also little money in their pocket. Until that changes don't expect a surge in young generation's interest collecting coins
The floor is in the cellar. The seller is on the floor. The debt ceiling is higher than ever, but the wages of sin remain the same.
Okay, back to shipping widgets on eBay.
Changing underlying fundamentals is the key issue, not another retiring cohort of collectors. The problem is whether enough young and middle-aged people have interest and funds to actively participate in the hobby. The financial pressures that young people, right out of college, face are much greater than what I experienced in my 20's. There is also little to no job security, medical costs keep increasing, and many private employers are not contributing to pension funds. In this kind of environment, routinely spending $1K on a coin (at least every few months) seems a big stretch for many.
In the latest issue of the MAC Advisory, Neil Musante noted that the ANA has a total membership of just 24,000. What fraction of the membership represents collectors--60%? Membership in specialty numismatic organizations is typically in the 300-800 range (ignoring some outliers). I would be curious to learn how the ANA and specialty organization membership figures have changed during the last 30-40 years.
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
You know, they can get all the ink off of those for you.
Keeper of the VAM Catalog • Professional Coin Imaging • Prime Number Set • World Coins in Early America • British Trade Dollars • Variety Attribution
I ended up getting what would be an AU58 today for $400. The prices and demand for the uncs was going up and I couldn't find one in my budget......
It's all about selection. Many AU58/MS61 type coins haven't done all that great since 1976. But others have done very well, especially better dates. That same $400 in 1976 could have probably bought several better date 0/S mint Barber halves in XF/AU. A 1904-s 50c at that time was priced at XF $115 and Unc at $450. A real nice AU certainly could have been had for $400. Very few better Barbers were bringing much of a price premium in XF/AU/Unc based on 1974-1975 Coin World Trends.
In 1975 I bought an XF 1802 half dollar at auction for $550. On the high end side I look at what $500-$1000 bought out of the James A. Stack sale in March 1975. A superb gem 1904-0 25c for $850, a gem 1855 half for $900, a gem 1904-s half for $1,000. I know the first 2 coins well and they have brought in the $30K-$40K range in recent times. Quite a few superb coins from that 1975 sale had advanced approx 50X in price by 2008. $250 bought a Fine 1801 half dollar and $295 an XF 1859-s 25c. If only one could go back..........
I do recall buying a choice unc 1903-0 Barber half out of a 1975/1976 NERCG auction for around $675 or something. But it had the usual flat strike and today would be no better than 63/64. It was a bad choice and I unloaded it by 1980 for around what I paid. Buying at market bottoms offers much potential (1975-1976, 1981-1982, 1994-1996, 2000-2003, 2009-2011, etc.).
I'm not sure I believe we have reached the bottom. Only time will tell.
Likewise, I am not sure there will be a significant, long term return.
Sounds like my Canadian gold stocks....
Welcome to the world of the Canadian coin market!
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
I'm still willing to spend a record amount for a certain quarter we discussed.
My 1866 Philly Mint Set
And all I want is a 1795 Draped Bust dollar (off center) in F-VF.
That should prop the market for those at least.
Exactly how is the Canadian coin market?
I'm sure people have been saying this about classic silver commemoratives since the mid-1990s, but so far, I am still waiting for evidence of a recovery. Sometimes cheap isn't cheap enough.
Not robust eh
mark
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......
That is funny!
If you are a collector and are collecting with a purpose you relish times like these.
mark
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......
The newcomers are the life blood of any hobby; in this case the sour economy doesn't help, with many middle class people not having much in spare bucks. There are no magic formulas or time frames. Eye appeal and PQ always sells.
Pre 2008, coins were selling for 80% of Canadian Trends (our 'official price list) and quite often more on Ebay.
Since then to the present, 50% on Ebay is the norm.
Dealers are still selling at 80% of trends at coin shows but they really aren't selling at all, just asking for 80% (coins collecting dust- dealers in dreamland).
Another indicator.................
Pre 2008, I was selling any kind of ICCS coin to the dealers for 60% of trends.
Now, half of them only offer 35% and the other half don't want to buy at all.
Definitely a buyer's market.
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
... There is usually not much to buy at the cheap prices unless the market has been "dead" for several years.
This is one of paradoxes I have seen in the coin market as a collector. Quite often you can't take advantage of the "cheap prices" because there is nothing to buy or what is available are "C coins" that don't measure up to the grade.
The BIG problem as i see it is how stale and stagnant a LOT of inventories have gotten.
Dealers i used to browse are now hardly worth more than a very sporadic viewing.
This should make itself evident by diminishing sales, but for many it looks as if their business practice is to hold at any price to not "lose" on any coin.
What then happens is they lose ALL business.
Turn some stuff!
No way to do it practically, but even swapping and shuffling would be refreshing.
I probably have quit even looking at half of my stored dealer links.
Please let me know when we hit the bottom.
I'm in the exact same boat. I'm only checking auction sites now.
IG: DeCourcyCoinsEbay: neilrobertson
"Numismatic categorizations, if left unconstrained, will increase spontaneously over time." -me
It will only get worse with the increased cost of grading, the increased push for extra fees through meaningless first strike/retro/special holders, and the increased need for regrades due to gradeflation.
Is this across the board, or are some series holding up better than others. ?
Mainly across the board as far as series goes.
Of course, the few key dates within each series are doing better.
"“Those who sacrifice liberty for security/safety deserve neither.“(Benjamin Franklin)
"I only golf on days that end in 'Y'" (DE59)
As long as there is a market, you are not at the bottom....
Coin Club Benefit auctions ..... View the Lots
I still look at my dealer links because I have found that if I keep digging, I find something once and a while.
As for dealer never taking a loss, and offering a lot of stale stock, that is just a poor marketing strategy. When I was a dealer I took the loss if it had been around for more than six months or so. You lose lookers and customers if you have the same stuff month after month.
You take your lumps, buy at the new levels and keep turning your inventory. Maybe today you can't buy decent stuff as a dealer. It's hard to do when you are a collector who is willing to pay full retail and beyond.
Wise words. Adjustable, but mainly ...wise.
I did a housecleaning starting some months ago when Russ was alive.
Glad I did. MY ...collection.... was ....STALE!
I had stuff I ...never... looked at.
It is gone.
Mostly for less than I paid, but I consider coins a lot like cars and as long as you like em, keep em.
Once they no longer please you,
GONE!
NOW, I have mostly "keepers." Many that took (and WOULD take) a long time to even FIND.
But....occasionally I find myself tiring of something and have adopted the REAL "I want to sell this" conviction and send them to AUCTION!
That IS the "market." Fast and sweet and SURE!
No messing and guessing on BST.
Ian is too easy to deal with at Great Collections to bother trying for a few "extra bucks" and a LOT of work and bouncing around.
At least that's MY current approach.
Fresh stuff priced fairly, or even slightly above fairly, still seems to disappear from dealer sites in the first few days after it's posted. Junk, widgets and overpriced stuff (by whatever definition) does not. My current buying restrictions are about weddings and school expenses, not the economy. I know it hurts other people, but I'm fine with the market staying flat another year so I can start buying again, but I will still want fair prices. I have a couple of dealers I browse that I estimate are 1.5-2x market price and they still seem to do OK...when THEY start dropping prices, that may be the trigger to get back in (or run).
The hardest hit are modern silver (1950s-1960s) coins, especially those in gem grades that used to have a very high book value. They are now common/dreck as the pop reports increased dramatically over the period of 2006 to now.
The older and key date coins do well. Nicer older (pre-1911) stuff does as well. Agreed that it's definitely a buyer's market, but only the newer coins need to be at "fire sale" pricing to actually sell.
So, what is your advice in 2017?
Would love to hear from more seasoned dealers, collectors, and experts.
Short term bottom opportunities?
Long term bull opportunities.
If die marriage enthusiasts can lead a huge bull run in Draped bust Halfs, copper, etc... what is your opinion on VAM's?
Find opportunities in things that are lagging or overlooked. Beat the bushes for "fresh" coins that have a real reason to rise in value. The problem is, that every year about 5-10% of what used to have a "decent" reason, no longer does. You have to be on that leading edge, not the trailing edge. If everyone does this, the market will collapse any ways as everyone ignores the bottom 80-90% of the market, the remaining 10-20% will find it hard to lift all boats.
No doubt plenty of upside in better varieties, better vams, etc, especially those you can cherry pick unattributed. Unusual and nice color in a variety of coins. Find full or perfect strikes in coins that don't come that way. Full Heads and Full Bands are fine, but how about a 98-100% full strike? Gem type from emerging markets is another opportunity. What about India, China, Australia, Brazil, Peru, Chile? Find key dates in series that aren't priced quite like key dates yet. The bust, seated, and Barber series still have some. Choice original VF/XF/AU dated material in early 20th century coinage seems underrated. Try doing a Barber, Lincoln, Merc, SLQ set in any of those grades....you can skip the "key" dates if you like. Research and pounding the pavement is important.
I've owned a number of coins in the past 10 yrs that I knew should have been keepers....yet let them go. You can't do that. I recall an old fatty NGC MS66 Connecticut with Christmas tree colors. Or an original 1900 gem 65/66 Proof Set handed down from the original family including orig documents and wrappers. You can't replace that stuff. This kind of discussion is hard to do here because there are so many variables, starting with available funds, time and effort, patience, time frame, etc. Everyone is different. There's no one answer.
It's funny (not 'ha ha'!) that the coins I want (not US) seem to go far above estimate (recently, by 50% for the coin I won, and 2x for the coin I lost -- estimates by my agent, which was over the auction house's estimates).
And, the coins I want to sell too frequently seem not to bring similarly strong money.
Sad. Bigly sad. YUGE sadness.
EVP
How does one get a hater to stop hating?
I can be reached at evillageprowler@gmail.com
2) The coin is stupid cheap and this is a great time to collect these coins.
That's what I'm sayin'
This is the clear market trend. If it's the type of thing that sharp collectors want, the market is strong and, in many areas, rising. But for less desirable material, prices continue lower. The newbies and casual buyers who normally might absorb the second and third-tier material just aren't around like they used to be. And dealers have, for the most part, given up on stocking coins that simply sit and depreciate.
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
Should dealers be marketing a (near) bottom? Couldn't hurt business.
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
It could hurt business if they're wrong year after year. Consider those dealers who called the bottom in 1992....then 1993, then 1994, then 1995. By 1996 they'd have been right....but with many of their former customers long gone. How about dealers who have called the bottom in classic ch/gem BU commems over the past 27 years? I'm sure there have been MANY of those.
I called a market bottom in late December. Not as marketing, but because I wanted to be able to say "I told you so". Funny thing is that I'm still not sure if I was right. Lots of conflicting signals out there right now. (Hence, the OP.)
Doggedly collecting coins of the Central American Republic.
Visit the Society of US Pattern Collectors at USPatterns.com.
The true question is who was and is buying those keys/premium? A new generation from middle class or a retiree who had been in this hobby for decades and may be one more decade to go before an heir auctions the collection off?