Options
How is the rise in gold prices impacting the overall rare coin market?
jkrk
Posts: 1,028 ✭✭✭✭✭
How is the rise in gold prices impacting the overall rare coin market?
Clearly, the economy / disposable income is also a major factor but I assume the rising gold price is more of a positive backdrop versus not?
Sorry for the delay (Too much Tylenol).
0
Comments
A Friday request …please use thread titles that give readers a much better clue about what the subject is.
Mark Feld* of Heritage Auctions*Unless otherwise noted, my posts here represent my personal opinions.
Suggest that you edit your thread title to read the same as the first sentence of your post. You'll probably get more views since most here don't have time for click-bait.
Worry is the interest you pay on a debt you may not owe.
"Paper money eventually returns to its intrinsic value---zero."----Voltaire
"Everything you say should be true, but not everything true should be said."----Voltaire
Junk gold and silver is more expensive than it was a year ago, the rise in prices for gold has swallowed up generic gold under the MS64 grade level as it all sells for around melt. Great if you have junk or ex-jewelry type material bought at lower spot prices as you are in the "rising tide raises all boats" camp and now may be a good time to dump that and take profits. The downside is that some dealers are not buying or discounting that type of material to offset risks of volatile spot price changes.
My Collection of Old Holders
Never a slave to one plastic brand will I ever be.
I became reinterested in coins in 1980, with the rise of PMs, so maybe others will become interested now.
I had thought the increase would bring more to market but judging from the GC auctions of DE's it has not. I guess when people find out their MS62/63 Lib or Saint is now a melt coin they decide to hang onto it. I have also heard dealers want to buy them back of melt. I would not be one to sell a DE under melt.
Completed All CAC approved Classic Head $5 set https://www.pcgs.com/setregistry/mysetregistry/album/344241
CBH Set https://www.pcgs.com/setregistry/everyman-collections/everyman-half-dollars/everyman-capped-bust-half-dollars-1807-1839/album/345572
To the extent it sticks:
It will turn more collectible coins into bullion coins.
It will price out more collectors out of coins they previously bought and to the extent it doesn't, more collectors will still buy something else other than generic gold (or silver).
@jmlanzaf I don't think I ever used the work "demand" though a seller can ask anything they want to. Just surprised people in US shy away from gold and other parts of world love it.
Completed All CAC approved Classic Head $5 set https://www.pcgs.com/setregistry/mysetregistry/album/344241
CBH Set https://www.pcgs.com/setregistry/everyman-collections/everyman-half-dollars/everyman-capped-bust-half-dollars-1807-1839/album/345572
In late 1990s before gold bottomed around $260 I bought gold at $300 area. Plan was to buy bullion but shop suggested $20 Double Eagles at spot plus 10% premium. His reasoning was when gold started to go back premium percentages would increase from demand. Sounded legit. Dumped most of it around $500 spot and received little if any premium. Was told that there was huge supply coming from European banks.
I would be curious what premiums were on generic gold with the 1980s run up.
Years ago collected 1/10 gold bullion each year. Sold them to pay for 2009 UHR. Can’t imagine paying the gold prices over the last 10+ years to have continued the set.
How is the rise in gold prices impacting gold coins other than Double Eagles?
Define “generic gold”.
Common saints in 65 have traded for as much as 5x melt price around ‘08-‘09, and I think premiums were similar to the 80s run up. Right now, historically, slabbed premiums 33 has the lowest premiums of all time, historically. 500% now down to…around 5%.
Founder- Peak Rarities
Website
Instagram
Facebook
I believe it will influence investors to put some more money into slabbed gold coins especially those close to melt. Especially slabbed modern US & world gold issues close to melt and a plus investment if low pop. However attractive slabbed US Gold Type coins close to melt a strong target too. It’s just a matter of taste, pocket of cash available.
As far as "rare coins" are concerned i don't think it affects the market at all. Most of the value of truly rare coins is in their rarity rather than the gold price.
I recently sold some lower end silver sets (G-VG) that I had just stuck in their respective whitman folders, that included 2 circulated Roosevelt sets, nearly complete low end mercury dime sets, Washington quarter sets and lower grade Walking liberty sets minus any keys. These will never be expensive collector coins and based on what I paid vs what I got paid, it just made the most sense to sell. I will turn around and use the money to buy collector grade gold from a friend that is selling. I think more people will do what I did. I did not sell any of my low grade Barber stuff. That stuff is too difficult to complete to just let go for melt. Now if it keeps going up, who knows what Ill do!
The folks who paid a 10% premium on common date Saints are in a great position selling at melt with these current prices. The profit is for the taking if they choose so. If they’re hung up on getting their 10% “premium” back, then wait til gold falls to $2500 again. Cutting your nose off to spite your face.
I just took some profits and sold a couple ms64s for melt -$10 just to fill out the rest of the PCGS box getting shipped out. Sure, they had some type of premium when I bought them, but regardless, there's at least $1000 profit on each coin because of the run-up in gold, so I don't really care. 🤷♂️
Founder- Peak Rarities
Website
Instagram
Facebook
We’ll see, it went high enough that it motivated me to deliver some modern gold coins to Great Collections this week, with the hope that the bump up in spot price will help me fund going after some more coins for my circulated type sets. Won’t know til the auctions are over whether or not I made a good call.
Mr_Spud
100% correct.
It really doesn’t matter. Premiums, gold spot, the wind….they're just steering mechanisms. The price is the price.
@jfriedm56 - Those aren't typical generics, those look like coins put away 20+ years ago. I'd send all but the '26 to the sticker factory; the coins I just sold are dogs compared to those.
Founder- Peak Rarities
Website
Instagram
Facebook
@jmlanzaf, I wasn’t ignoring your half sentence. I was stressing the point that why would I sell these beautiful DEs for less than melt? That’s my point. I’m a coin collector first and foremost. You’re a belligerent bully and know it all, as far as we’re concerned never have anything that I’ve read from you, being positive. You’re only adversarial and I choose to no longer to deal with you.
I think it numbs or dulls the coin market to have silver and gold going so high. IMHO, silver is not all that special and although I am ok with it have not made any special move toward it and have a bucketload (or two). All of it has become less interesting.
Then there is gold - some years ago (and I do collect foreign) I bought a nice collector coin with 2.35 oz gold in it, and now the enormous gold content has evaporated the numismatic value.
Well, just Love coins, period.
I don’t believe anybody is giving them away at melt. They are really nice PQ slabbed coins - PQ tackon! If I could not get cost plus on them or what I wanted would just put them away. I bet they would all sticker too - CAC CPG value…if somebody giving them away at melt time buy some, put them away.
Just so. I'm taking advantage of the compression in premiums to buy better date double eagles in higher grades than I'd otherwise consider. Sellers win and so do I, especially if my view of bullion price levels is correct.
Does the material give rise to the immaterial, or vice versa?
Anyone building their position would be wise to do so, as a buyer I think it’s a no brainer insurance policy right now.
Founder- Peak Rarities
Website
Instagram
Facebook