The Latest Legend Market Report got me thinking
Gazes
Posts: 2,315 ✭✭✭✭✭
I always enjoy the Legend's Market Report. I love coins and love reading the thoughts of one of the top dealers. This week the report mentioned that BIllionaire's are now well represented in our hobby. The market report caught my eye on a few comments 1) at least 6 billionaire's have collections ranging at the low end of 25 million and a couple over 200 million 2) one collector has over 3.6 million in duplicates and her comment is that this has deprived others from completing sets and the most important comment from my perspective 3) the report states "we suggest people adjust their tastes and budgets." Wow.
This report got me thinking and prepared to make a bold prediction. Let me preface this opinion that I am talking about the upper end of the coin market which I will define as generally condition census coins and/or coins $10,000 and up. My prediction is that we will see the greatest price move we have ever seen over the next 5 years for these top tier coins.
This opinion has been percolating in mind for the last several months but the Legend report crystalized it. First there is alot of money out there at the top. We see it driving up prices from everything from bit coin, to digital art, to baseball cards, etc. Assuming the report is accurate, the ultra wealthy has found coins. If you are buying condition census coins and holding them, it does not take much push these prices up. When a condition census coin comes up for sale the effect of not knowing when the next one will come around will help push up the prices.
There use to be pockets of really rare series that you could collect in condition census (i.e liberty quarter eagle) and pay $12,000 for a top 2 or 3 census coin. I think those days may be over. As for less expensive coins, I dont think the same dynamics exist and those coins will not share the rise in prices. I see the gaps between the top tier coins and the rest as growing.
Again, just an opinion but I have collected a long time and never had this strong of an opinion as I do now.
Comments
I wonder if she is referring to our forum member buddy?
I'm not so sure about this. While some prices are going up, prices at the top end for coins seems to be limited. No coin has broken the $10M barrier since 2013, while records are being broken in other areas. The 1794 Plugged Dollar also failed to sell recently.
We are also coming out of Covid soon, after which billionaire yachts will be back in vogue.
An interesting thing about coins, is that other areas are seeing strong, recording braking demand.
We all know about the $70M NFT art sale:
https://forums.collectors.com/discussion/1053762/skys-the-limit-for-collectible-digital-coins-digital-only-art-sells-for-70m
Comics just broke a record announced this month:
Look! Up in the sky! It’s a stratospheric $3.25-million record sale of rare Superman comic
My "prediction" is going forward over the next 5 years. I think the 10 million barrier during this time period will be soundly beaten. But more important to at least me, I think we will see huge jumps in coins that are the condition census especially with cac approval.
I have hopes for the Weitzman Double Eagle to set a new record. I also had hopes for the Brand-Eliasberg 1822 Half Eagle and Stickney-Partrick Brasher but no dice yet. Hopefully, third time is the charm!
I think a lot of what happens will depend on how people stick with Covid hobbies after Covid. At least coins take less storage space than cars
Laura is saying that no one was collecting Buffalo Nickels while Jerry Forsythe was collecting them. This isn't what I've seen on the forums with the beautiful nickels from @crazyhounddog and others. It'd be great to compare some CHD and Forsythe nickels.
"The rest of the world could not collect Buffalos in GEM."
The overwhelming majority of the rest of the world doesn't collect buffalos in gem.
Just sayin'.
It's true.
i think it is very dangerous to judge a market by the upper stratosphere. [Not that that's what @Gazes was doing.] If you judge the philatelic market by the $100k+ stamps, it looks like the stamp market is vibrant and prices continue to move up. However, the collector part of the market has been moribund and dropping for 2 decades.
You could have 50 billionaires all trying to complete the Eliasberg set at the same time and it might have exactly zero affect on anything I buy. 50 billionaires competing over a 1913 Liberty nickel is likely not going to move the price on the MS65 1912 Liberty nickel that I'm looking at.
And “GEM” is an ambiguous term.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
I would bet most collectors don't even collect slabbed coins, let alone gems in slabs. There's virtually no connection between these two (top pop $100k+ coins and all the others) markets. Crash Davis: "It's like a Martian talking to a fungo."
I just saw a 1919-D Walker in MS65 sell for $100k. Somehow, I don't think my collection is worth a nickel more. LOL.
You are correct that I'm not really focused on the upper stratosphere. For instance, a coin that recently sold was a pcgs 63
1845-0 quarter eagle. It went for $113,000. That is a coin that I think alot of collectors could have stretched for previously but is now a 6 figure coin. Forget about 7 figure coins---I think $20,000 coins will be become 50,000 and 50,000 coins will become 6 figure. Again, I would limit it to condition census coins, cac helps, proof gold and old gold.
Has the owner of Legend ever written anything that was negative about the strength of the coin market, just wondering? I understand Legend has an incredible reputation as a dealer and boutique auction house and I would be honored to buy a coin in my niche from them
That's pretty cheap for a '19-D in that grade. Who's slab was it in?
For most collectors, that coin IS the upper stratosphere. Even previously.
What she is saying is that her other high end customers could not find Buffalo nickels in the top grades, because Forsythe was holding them.
She's not saying it affected people buying MS-64s or 65s.
This is a concern about hoarding / dups that others have expressed in the past, in various contexts.
Gerry Fortin has created a path for his customers to roll over their Liberty Seated dups, to deal with this sort of thing.
I agree a 6 figure coin is upper stratosphere but was just making clear I'm not talking about the multimillion dollar coins. But you are really making my point---that coin is really now out of reach for almost all collectors. I think any top 5 1845-O QE will now be out of reach to more and more collectors (5 years ago not so much) I think that is what she meant by collectors adjusting their tastes and budget. A collector putting together a set (in this case in QE) in condition census may now not be able to do it because of 1) cost and 2) availability (mega collectors sitting on coins)
No, you misunderstood my post. For most collectors, 5 figures is upper stratosphere.
Ok. In my OP my prediction is for unprecedented growth in price for coins that are $10,000 or more and /or condition census.
I have no argument with this. My point is that, for the overwhelming majority of collectors, that's entirely irrelevant.
In the world of coin collecting, the number of collectors putting together sets of Quarter Eagles is minuscule. I don’t think nearly as many collectors would or could be affected as you seem to believe.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
pcgs
This may be accurate. My point is really that the 6 figure and up part of the market is close to irrelevant to the coin market as a whole. The stamp market all but proves it. It keeps setting records in the $100k+ part of the market while I'm happy to get 15% of catalogue in the $100 part of the market even AFTER they cut the prices in the guide in half.
The lib quarter eagle is just an example I was giving. That being said one reason a world class collection of lib quarter eagles was doable was because there were not alot of collectors putting together a set so prices reflected that. In the last few years there has been a surge of collectors building quarter eagle sets. Doug Winter has confirmed this to me. So I dont want my OP to get sidetracked by a discussion of Lib QE but there are more collectors pursuing these coins now than one might think. 5 years ago condition census lib QEs were offered all the time. Those type of coins have dried up considerably in the last couple of years. When they come to market the prices are strong and I predict they will be very strong over the next 5 years
On the rare occasion I’ve purchased a “Legend” quality coin, it’s been at the very bottom of that tier. What the whales do isn’t likely to affect me much.
This may well be true, although my crystal ball remains in the shop. Although I think a lot of that is going to depend on social and economic forces that are very hard to predict. The past is prelude. But the past is not always a good indicator of the future. We could just as easily see a major player sell their collection and prick the balloon.
I remain in the "buy it because you like it" camp and if you ever get a significant fraction your money back, consider it a win.
Words to live by.
With respect to the OP view of the lower end of the market, I’ve been having a lot of fun putting together some relatively moderately priced sets over the past year (Circulated Barber halves and silver Kennedys) and the prices seem quite strong, especially for the Barbers. I’m not sure that the lower tiers of the market are dead.
They're not. Or, at least, they're not all. But they're not tied to what the upper tiers are doing.
This is true for ancient coins as well. Though there is no Top Pop or Condition Census list for ancients, the beautiful examples - those that would appeal to art history folks not just numismatic weenies - have doubled, tripled, or more in price in the past two years. Prices for the more mundane stuff has strengthened somewhat as well, but a $20 coin now selling for $30 doesn't have anything to do with a $3,000 coin selling for $12,000. The former is probably COVID boredom, the latter is the nouveau-riche in my opinion.
LIBERTY SEATED DIMES WITH MAJOR VARIETIES CIRCULATION STRIKES (1837-1891) digital album
I'm not sure anyone said the lower end is dead. It has been quite vibrant lately. But I was referring to the fact that the bottom and top aren't necessarily coupled as proven by the stamp market.
@jmlanzaf said: "I'm not sure anyone said the lower end is dead".
My statement was definitely a bit off the mark.
I was (imprecisely) responding in part to @Gazes' statement "As for less expensive coins, I don't think the same dynamics exist and those coins will not share the rise in prices. I see the gaps between the top tier coins and the rest as growing."
I wouldn't be surprised to see strong gains in some segments of the "lower tiers" of the market. One thing I've found interesting about the dynamic in the circulated Barber segment -- there is a very strong appreciation for quality (within a given grade range), and prices paid for a given grade vary significantly and correlate with eye appeal. People looking for an F15 1892-s Barber seem to be very discerning--they are not just buying the plastic. That's a good sign for the market.
With respect to connectivity of the various market tiers, if you exclude the "trophy" coins, I suspect there may be more than people think. It would be an interesting but challenging exercise to try to verify this in some empirical manner.
I find Laura's market reports to be very sincere........but one has to understand her perspective as a boutique dealer of very high value coins. Her insight is not for the average collector though. The coins that are being purchased at the very top end of the market are probably not a representation of the even slightly lower end of the market.
I find it interesting that Stuart Weitzman, the very famous shoe designer, is putting up for sale his 1933 double eagle as well as his Guinea stamp that is also a one of a kind. I do not recall if he owns any significant collections in the Registry sets. But he has been very under the radar, at least in our forum? Perhaps he is also the owner of the J-1776 pattern double eagle?
And i am sure the DLH's duplicates greatly exceed 3.5 million considering his posted registry sets.
But her perspective is spot on.
OINK
Stuart Weitzman is not the owner of J-1776. The owner’s identity is known by a number of people in the industry.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
I don’t collect or have actively bought any US coins in the last 4 1/2 years ( except for my one recent purchase )
However it would not surprise me if the OP’s opinion becomes true over the next 5 years
I give away money. I collect money.
I don’t love money . I do love the Lord God.
Interesting. I guess anything under $10,000 will be a widget.
Wasn’t the owner identified here on this forum by either Laura or TDN?
If I recall correctly there was some discussion about the coin being locked into some kind of trust where it would go to heirs and never see the light of day in an auction?
Now just hold on a minute..
Are saying you read a Legend market report that reinforced your already favorable outlook towards expensive, condition census CAC coins?!? 🤯
Liberty: Parent of Science & Industry
Hey I take offence to saying customers of Laura are anything other than enthusiasts, some of us are just coin collectors. Yeah she deals in some top end coins but also coins that anyone with a good job can afford. Yeah if you are 12 she is not for you. I personally always have her bid on coins for me, today in fact; her eye and straight talk is awesome. Personally I have felt the Billionaire pressure for filling out my top sets. I worked for 2 decades to put together the top 1868 mint set to be surpassed in a year by DL. None of those coins came up for me to buy - I would have bought or at least fought for them - nope no chance. That sucks - at least go to auction - don't sell direct. I have a dozen or more coins he needs and I am not going to go direct if I decide to sell, simply because I am not going to play the game.
I'm not sure why auction is any less a game than direct.
My goal is to maximize my return. If selling direct accomplishes that, I have no responsibility to give you a chance to bid.
That sounds like something I read here. But since I don’t know for certain that the owner’s name has been disclosed, I don’t feel it would be appropriate for me to do so.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
The condition census market has already seen large gains in the past year especially for PCGS/CAC. This funneling of the best coins (or at least perceived) to a narrower window of desirability/public endorsement has created confidence in buyers and condition/condition rarity. I hope prices continue to rise but there are always outside factors to consider not least of which is a strong economy. I do believe that the top tier of coins will likely perform well but you never know. Just think of what has happened with early copper coins.
I read the comments and can confirm that I am not one of the 6 stated in the OP. I am, however, putting together one of the nicest mid-grade US type coin collections out there. It's actually much more challenging to build a nice collection of eye-appealing, original coins this way than just opening up your somewhat unlimited pocketbook for the best available. I think collectors like myself are the heart of the market, not the whales.
I think there are many more collectors out there like you that have already been impacted by mega collectors. I am certainly one of them. Based upon my OP I think this trend will only continue to expand (i.e harder to find condition census coins and when found obtaining them at reasonable prices). Ways to combat it---relationship with a dealer who will put you first every now and then, same budget but purchase less coins, relationships with other collectors in your series, and looking for coins in some less than obvious places.
Her conclusion... whales have made a big splash.
My contrarian POV... it is a big ocean.
As a born contrarian, even I have a hard time arguing with her logic.
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If one whale prevents others from collecting gem 🦬 nickels, will more whales prevent more collecting for more types? If so, what will happen to the collecting landscape?
I believe Gazes projections may turn out to be true but I think a lot is dependent on the overall financial state of the country. If the wealthy our paying significantly higher taxes and the stock market drops and we have significant inflation there will be less demand for expensive coins IMHO. The wealthy are like everyone else, if they have less money they won’t spend it as freely especially if their assets aren’t liquid.
@Gazes I sold my 1845-O P/C AU55 $2.50 yesterday in the Heritage auction. It was one of the nicest coins in my collection and I really enjoyed my two years of stewardship...but given other priorities I decided to take some money off the table. When I purchased it from DW for $14K I assumed I would probably never get my money back (Price Guide = $11K) but lo and behold it hammered yesterday for $16K.
But while I agree that the market will probably go up over the next five years that doesn't mean it will go up in a straight line. Like Bitcoin, there will be pull-backs and opportunities over time to find bargains.
Thanks to Zane (@zas107) for making it super easy to sell this great coin and making it worth my while to consign it thru him.
Agree. Just like Covid, there could be something we're not even expecting that could forever change the way we think about our financial state. Best advice is to not even worry about what the whales are doing. If you're a collector, collect what you like and are comfortable affording. If you're a dealer, you need to plan and have contingencies for the unknown.
srangely enough the proposed Biden increased tax on capital gains might help the coin market. As of now coins do not enjoy the most favorable long term capital gains rate that stocks and real estate enjoys which can be as low as 15%.
It appears that the Biden proposal would equalize the long term capital gains rate between stock/real estate and collectibles.
It could, but the transaction costs would still be very different.
Another way to combat this is to go to where the 🐳 aren’t and come back when they go away, like the Forsythe 💎 Buffalo nickel example.