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Coin Market Holding Up Pretty Well in View of the Metals Meltdown
Luxor
Posts: 616 ✭✭✭✭✭
As I post this, silver broke below $50 and gold below $4K. It's been a huge correction for silver from its somewhat recent top of well over $100. I don't think better high end collector material has felt the metals meltdown too much if at all really. As far as common stuff, are any generic coins that trade primarily on melt value starting to look really attractive to you, or do you think we have a ways to go lower still?
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Your hobby is supposed to be your therapy, not the reason you need it.
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I've been planning to buy a modern $5 gold proof at the next show I attend to complete a small side set I'm working on. I'm happy to see that I'll apparently be able to save several hundred dollars compared to prices earlier in the year.
On the other hand, as much I am greatly enjoying the semiquincentennial Best of the Mint set I put together, it would have been nice to pay less considering the amount of gold that was involved there.
chopmarkedtradedollars.com
I think the metals market meltdown is manipulation by central banks, and the mysterious LBMA and COMEX..
The amount of "paper gold" and "paper silver" traded can exceed the amount of metal readily available for physical delivery. This allows large players to temporarily push prices around without moving actual bullion.
That's not a crazy observation. Futures markets in many commodities trade volumes far larger than physical inventories.
What is interesting to me is that NUMISMATICS and the premiums assigned to things like mintage numbers seem to diminish when prices go higher. We will probably have to get used to it.
Its a good time to buy a scarce coin that you want to collect. Not as an investment, but just because you can afford it. You might not be able to afford it if silver goes stratospheric again.
I believe that the silver markets (and gold) are highly manipulated. But as the supply slowly disappears, more and more junk silver is melted down. Only so much silver can be pulled out of the ground.
Demand for silver will be steady, but what is interesting is that countries like India and China are importing it like crazy. They have set limits on silver exports, and at the same time removed limits on imports. And the physical market is completely disconnected from the futures (paper) markets.
Sooner or later there will be a squeeze on silver that will make the 1980 Hunt Bros squeeze look miniscule. In the meantime, I collect, stack, and when the time comes I will sell some "constitutional silver" to make ends meet.
I’m hoping for a big drop with the botm coins. I’d love to pick up a st gaudens for a decent price
Me too and the 1804 Dollar isn't shabby either.
The best explanation for it is that the coins you are implying become too expensive as a collectible when most of the price is directly correlated to the metal content, meaning hobbyist collectors (as opposed to those buying more for financial reasons or with a liquidity preference) prefer to buy something else.
I don't find the result surprising, unless I completely missed that there was a run-up on the way up too.
I'm happy to see this for true numismatic coins that had previously been relegated to bullion status.
The problem isn't with the hobby. There's plenty of fresh money and money not tied to metals' prices. This will hurt at least some because now there's a negative "wealth effect" coming online.
The problem is some entities in the coin business might be long on metals and not completely hedged. This could cause problems if prices continue to fall or for heavily leveraged players.
Let's see what the mint will do with these reductions....
Kind of like spending money you don't have.
The majority of those buying commodity futures contracts aren't interested in taking physical delivery. I'm not aware that this is any different than buying futures and options for financial instruments where I've never read that these contracts are hardly ever exercised either.
Their desire to take delivery in the spring is what led to the bubble.
All comments reflect the opinion of the author, even when irrefutably accurate.
Coin Market strong: Walkers, Commems, Dollars, Mexico 1oz Libertads (many wkg on sets).
Yes mkt heating up.
I've been casually browsing GC's weekly auctions, and I've been surprised at how strong some of the auction results have been across the board. Pretty much every series, date, and denomination I encountered had strong results. Even the overgraded ICG coins sold for strong money for that they really were.