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Early Long Beach Report (Warning, this is not an upbeat report)
Bear
Posts: 18,954 ✭✭
I arrived at the Long beach Show at 12 noon and left at 5 PM.
Now, this is my personnal perception of what I saw and what I sensed.
The show was less the anticipated. It appears that all of the continuous auctions
have taken the wind out of a lot of retail bussiness. Dealers are making 5-10%
bidding for clients instead of 20% on retail sales. While toned Morgans and toned
Classic Commems are making the headlines, these are mainly for the few the brave and
the bold. The high flying expensive coins continue to float in the high atmosphere but the
more down to earth coins in the lower and mid range seemed on the soft side. Its much like a
house that seems strong and sturdy but the termites have eaten and weakened the structural
underpinnings. While posted prices seem to be stable, I notice numbers of high grade type and
Classic Commems seem to be stacking up in dealers cases. It is my impression that collectors
of more average status, are getting ever more picky with purchases and tighter with their money. Dealers
also are getting picky on what they will buy and do not seem to want to get too heavy a supply of coins that wont
sell easily. Some dealers like Mike DeFalco have been selling a ton of toned dollars at fairly reasonable prices, but
purchases have been difficult. Larry Shepherd of Simco has sold a ton of high quality Classic toned Commems from
his most recent catalogue but much of the rest of the dealers seem exausted, deflated and very careful in their
buying. I dont know if this is another pause that refreshes or something more serious. As for myself, I sold 34,000 dollars
of assorted coins to get my self in a cash position. I took a loss now, rather then be faced with no sale at any price later.
Some dealers will pay 10% back for coins they sold you and others will not. You have to shop around for the best price
rather then doing one stop selling at a dealer where you are a large client and are expecting to be treated with a degree
of service, on sale back of coins purchased from that dealer. It seems it is now each man and woman for themself in dangerous waters.
I have kept the very highest grade Type coins including some Pop 1 highest grade in the Liberty Seated series and a number of
nice toned Classic Commems that I did not pay too much for. I dont know why I have this feeling of apprehension, but I believe
I will stop the bidding on auctions where you can sell your fancy won lots only at serious retail discount later on. I have purchased two
expensive, top of the line coins from dealers and I believe I will now settle down and sell nothing and buy nothing for the rest of the year,
with a few exceptions , here and there.
Again, I may be totally incorrect in my instincts and assessment of the market, but this is what I intend to do. I belive the day of the
incessent auctions may well have seen its zenith and the day of buying expensive coins from retail dealers will soon return to its
normal preeminant position. As always, opinions are usually worth what you pay for them, but this is my two cents worth.
Getting a true picture of the coin market is a bit like a committee of blind men, trying to describe an elephant.
Time itself,will determine what will be. ***********************************************************************
Now, this is my personnal perception of what I saw and what I sensed.
The show was less the anticipated. It appears that all of the continuous auctions
have taken the wind out of a lot of retail bussiness. Dealers are making 5-10%
bidding for clients instead of 20% on retail sales. While toned Morgans and toned
Classic Commems are making the headlines, these are mainly for the few the brave and
the bold. The high flying expensive coins continue to float in the high atmosphere but the
more down to earth coins in the lower and mid range seemed on the soft side. Its much like a
house that seems strong and sturdy but the termites have eaten and weakened the structural
underpinnings. While posted prices seem to be stable, I notice numbers of high grade type and
Classic Commems seem to be stacking up in dealers cases. It is my impression that collectors
of more average status, are getting ever more picky with purchases and tighter with their money. Dealers
also are getting picky on what they will buy and do not seem to want to get too heavy a supply of coins that wont
sell easily. Some dealers like Mike DeFalco have been selling a ton of toned dollars at fairly reasonable prices, but
purchases have been difficult. Larry Shepherd of Simco has sold a ton of high quality Classic toned Commems from
his most recent catalogue but much of the rest of the dealers seem exausted, deflated and very careful in their
buying. I dont know if this is another pause that refreshes or something more serious. As for myself, I sold 34,000 dollars
of assorted coins to get my self in a cash position. I took a loss now, rather then be faced with no sale at any price later.
Some dealers will pay 10% back for coins they sold you and others will not. You have to shop around for the best price
rather then doing one stop selling at a dealer where you are a large client and are expecting to be treated with a degree
of service, on sale back of coins purchased from that dealer. It seems it is now each man and woman for themself in dangerous waters.
I have kept the very highest grade Type coins including some Pop 1 highest grade in the Liberty Seated series and a number of
nice toned Classic Commems that I did not pay too much for. I dont know why I have this feeling of apprehension, but I believe
I will stop the bidding on auctions where you can sell your fancy won lots only at serious retail discount later on. I have purchased two
expensive, top of the line coins from dealers and I believe I will now settle down and sell nothing and buy nothing for the rest of the year,
with a few exceptions , here and there.
Again, I may be totally incorrect in my instincts and assessment of the market, but this is what I intend to do. I belive the day of the
incessent auctions may well have seen its zenith and the day of buying expensive coins from retail dealers will soon return to its
normal preeminant position. As always, opinions are usually worth what you pay for them, but this is my two cents worth.
Getting a true picture of the coin market is a bit like a committee of blind men, trying to describe an elephant.
Time itself,will determine what will be. ***********************************************************************
There once was a place called
Camelot
Camelot
0
Comments
Bear, thank you once again for the candid and well-thought report.
Now go take your $34000 and go buy some jelly donuts.
"I notice numbers of high grade type and Classic Commems seem to be stacking up in dealers cases"
Another Great rerort,
Thanks Bear.
What would be the show turnout if it was held only once a year ? What if other regional shows start going to 3 times a year like the F.U.N show ?
When the public feels it is not getting good service by the dealers, they
will not attend. When the big collections are finished reaching the auction houses,
we will find that the less noble specimens will be receiving weaker and weaker bids.
The workings of the market place, always will correct excesses in the market place. There
will be a realignment of retail dealers and the internet. In the balancing , some will fall while
others will rise. The more things change, the more things stay the same.
When you are told the market is hot, try selling something you bought in the last year or two. see
how much money you receive for the item. Did you make a profit, break even or take a loss. If the losses
outnumber the profits, then the hot market is either highly segmented or is an inflated balloon of heated gasses,
or both.
Camelot
Thanks for the report Bear! I'm going to have to ditch my Friday meetings and drive on up from San Diego! Boy I hope the coins I want are soft . . .
New collectors, please educate yourself before spending money on coins; there are people who believe that using numismatic knowledge to rip the naïve is what this hobby is all about.
My impression of you solely from your posts, is that you were a long-term buy and hold collector much like me. I always seek top quality for the price, and purchase coins with high eye-appeal.
Since you and I do not know one another personally, would you consider yourself more of a coin investor or a coin collector? Thanks in advance for your reply and comments!
Stuart
Collect 18th & 19th Century US Type Coins, Silver Dollars, $20 Gold Double Eagles and World Crowns & Talers with High Eye Appeal
"Luck is what happens when Preparation meets Opportunity"
the investment aspects of your collection play an ever larger part of the equation.
Camelot
Stuart
Collect 18th & 19th Century US Type Coins, Silver Dollars, $20 Gold Double Eagles and World Crowns & Talers with High Eye Appeal
"Luck is what happens when Preparation meets Opportunity"
These new reports will, to some extent, fill in the moseic of
an increasingle puzzling market place. It is hoped that by
reading different peoples views,we all can get a better feel
for what is actually going on in the economic aspects of
our hobby.
Camelot
As a Flordian and a FUN fanatic,....I can't get to California to compare FUN to a Long Beach show.
I appreciate your observations and insight.
Brian
I LOVE
<< <i>I can't get to California to compare FUN to a Long Beach show. >>
There is no comparison.
Unfortunately the Long Beach show has been in a gradual decline for years and is not a good gauge of the market. The retail market anyway. The Baltimore show would be a much better barometer.
Auction prices appear to be very high. I know one dealer who placed 28 bids for coins and won none. Along with several other dealers who were shut-out.
Thanks for the report.
edited for clarification.
<< <i>
<< <i>I can't get to California to compare FUN to a Long Beach show. >>
There is no comparison.
Unfortunately the Long Beach show has been in a gradual decline for years and is not a good gauge of the market. The retail market anyway. The Baltimore show would be a much better barometer.
Auction prices appear to be very high. I know one dealer who placed 28 bids for coins and won none. Along with several other dealers who were shut-out. >>
Thanks, for the real clarification.
Jerry
It used to be the bellweather show. Now it is just among many other national shows.
On ebay lately I have been placing many last second bids trying to buy at reasonable prices and I keep getting beat. Frequently by people paying stupid money (like way above CW Trends). The few things I have won have been where I was going after something hot and heavy because I know I'm going to sell it almost immediately at a small profit.
I realize I'm the little guy but... this is just my take on it and of course I'm not actually at the LB Show.
NoEbayAuctionsForNow
If I may borrow a page from DorkKarl, if you purchase a coin because you REALLY like it, as a true long-term collector, then the short-term or intermediate price fluctuations of your collection should not really have a material impact on your lifestyle or your overall net worth. The ultimate long-term liquidation price, when you decide (or are forced) to sell, or your heirs do, will eventually be a commercial issue.
If you have too large a share of your net worth invested in coins, then I would suggest that you are more of an investor with a poorly diversified portfolio, and that your family's net worth and thus your lifestyle is unnecessarily exposed to the market price fluctuations (high volatility risk) of coin prices.
I am no investment advisor, but I would suggest that no coin collector have more than 5%-10% of your family's net worth tied up in coins, so that their volatile market price fluctuations do not materially impact your family's well being and lifestyle.
Stuart
Collect 18th & 19th Century US Type Coins, Silver Dollars, $20 Gold Double Eagles and World Crowns & Talers with High Eye Appeal
"Luck is what happens when Preparation meets Opportunity"
In the past I had often heard that the coins were not that good or that there wasn’t enough “room” for them to make money(negotiating techniques). This time it seemed that they all really wanted them (they were PQ) but most of the dealers were very heavily committed. (Many to previous auction purchases of future bids.) Some were awaiting the auction results where they had a lot of potential purchases and were unsure of their cash status. Others I saw discussing “old” invoices that had not been paid. I wonder if maybe the dealer community has not put every dime they could beg or borrow into inventory, there sure didn’t seem to be a lack of material for sale.
This also leads me to concur a lot with Bear about the effects of the auctions, they seem to be overshadowing a lot of the show activity. In the past I know dealers had bid in the auctions but they seemed to be a side of the show and not the controlling force, today seemed different. Loaded with coins and still buying at the auctions I wonder if the dealers aren’t getting stretched thin. I addition, I wonder if the collectors aren’t starting to favor the auctions over the dealer showcase too. With the Internet bidding and the high resolution pictures, why should the collector pay the dealer 20% more when they can get it from the auction themselves.
My assessment:
1) Dealers inventory is high and cash is low
2) Sales are still strong but very selective, the “right” coins move FAST, other sit and are getting discounted
3) More buyers are going direct to the auctions
4) The hot market is bringing a lot of coins out of the woodwork. A huge number of coins are being auctioned and not all are hot, in demand or being absorbed.
5) Prices in certain areas will be dropping as dealers sell off the “unpopular” coins to build inventory in the “hot” areas.
6) There will be some good deals to be had in the “unpopular” areas of the market
My favorite quote:
One dealer looked at my 09-S in 66RD which I asked 2300 for. After shuffling though his sheets he asked if he could show it to a friend. A couple minutes late he returned and handed it back:
“I’m sorry, I thought it was a VDB.”
how much money you receive for the item. Did you make a profit, break even or take a loss. If the losses
outnumber the profits, then the hot market is either highly segmented or is an inflated balloon of heated gasses,
or both. >>>
.......exactly
Russ, NCNE
This is exactly what I've done. With an auction you can set your price and that's it. Of course, you have to be willing to realize you will not win everything AND, you must take into account the juice when you make your bid. If you can deal with these two major issues it's a much less stressful way to go. JMHO...
Chicolini: Mint? No, no, I no like a mint. Uh - what other flavor you got?
<< <i>One dealer looked at my 09-S in 66RD which I asked 2300 for. After shuffling though his sheets he asked if he could show it to a friend. A couple minutes late he returned and handed it back:
“I’m sorry, I thought it was a VDB.” >>
An 09-S VDB in 66RD for $2,300??? Clearly, that was a dealer that didn't have a clue. $2,300 is a great price for a 64RD.
By the way Bear, this was a great report.
I hope the prices do soften a bit.
I'm doing more buying than selling.
Lower prices mean more coins for me and I also am selective about what I purchase.
-----------
etexmike
Jerry
<< <i>
<< <i>One dealer looked at my 09-S in 66RD which I asked 2300 for. After shuffling though his sheets he asked if he could show it to a friend. A couple minutes late he returned and handed it back:
“I’m sorry, I thought it was a VDB.” >>
An 09-S VDB in 66RD for $2,300??? Clearly, that was a dealer that didn't have a clue. $2,300 is a great price for a 64RD. >>
Oh, I think the dealer had a clue.
New collectors, please educate yourself before spending money on coins; there are people who believe that using numismatic knowledge to rip the naïve is what this hobby is all about.
Is that you can review it at your leisure. I hate being rushed
when I make a coin purchase. They also extend payment periods if needed
and can usually give you some background on the coin. So many of the coins on auction
have been upgraded to the max and beyond just before the auction its just depressing.
I dont blame the owners, I just hate getting stuck with one of those" Its not a bad coin
but I just dont have a need for that coin" or a dealer saying "I dont like the coin" Those expressions
generally mean that the coin is maxed out and no longer PQ for the grade.
Camelot
Is that you can review it at your leisure. I hate being rushed
when I make a coin purchase.
I agree. I like to look at coins in various lighting conditions, including sunlight, something that you do not get at the bourse. I also do not like the pressure to make a decision and the feeling that you might be wasting the dealers time asking about the coin.
The week after the show, on the other hand, the dealers usually have more time to discuss the coin with you, along with its charms, its warts, and its history, before sending it to you for review. Often, by what they say or how they say it, you can exclude a coin sight unseen. Then, when you get a good prospect at home, you can live with for a day or so. Most of the time, the initial impression is the most important. Sometimes, you get a nagging feeling about it, discover a flaw or defect, and find a concrete reason to not want a coin.
Some of my favorite coins are the ones that have a flaw, and despite the flaw, I love the coin. I am not the norm as I generally collect coins for rarity and historic, with beauty being a distant third. Nonetheless, eye appeal for the grade is just as important for an XF-40 coin as it is for an MS-67 coin.
I personally feel that those who insist on buying mid-high range coins on the bourse, and there are quite a few, are missing out on some of the advantages to buying coins from a national dealer.
Jerry
is the generally liberal return policy they have. You just
try to return a coin to an auction house. If you dont pay
for the item you are threated with a suit or are blacklisted.
At least in my case, I am very happy to do bussiness with dealers
off their web site.
Camelot
<< <i>
<< <i>
<< <i>One dealer looked at my 09-S in 66RD which I asked 2300 for. After shuffling though his sheets he asked if he could show it to a friend. A couple minutes late he returned and handed it back:
“I’m sorry, I thought it was a VDB.” >>
An 09-S VDB in 66RD for $2,300??? Clearly, that was a dealer that didn't have a clue. $2,300 is a great price for a 64RD. >>
Oh, I think the dealer had a clue.
His name wasn't Ira, was it?
I cannot deny that the first thought that crossed my mind was the "25" thread.
Second thought was a Bluemooncoins auction for a "hidden" mint mark.
link
EVERY collector is an investor. If that weren't true, price would be of NO concern. NO ONE is happy to pay money for a coin (no matter how nice) if a better one is to be had cheaper and even less so if many, MANY superior specimens begin to reflect a genuine downtrend.
Market conditions make themselves known in many ways.
I wish all coins would appreciate 5% per year forever, but they won't. Some may do thousands of percent and some may flop and never get up.
We aren't real "collectors." Real "collectors" collect rocks. Or other things that can be COLLECTED.
We like to THINK we collect, but in reality, purchased things are investments in the purest sense of the word.
Demographics and economics rule this ...... hobby. Always have, always will.
Stuart
Collect 18th & 19th Century US Type Coins, Silver Dollars, $20 Gold Double Eagles and World Crowns & Talers with High Eye Appeal
"Luck is what happens when Preparation meets Opportunity"
<< <i>Thanks Bear, for confirming my post of a couple weeks ago.
link
EVERY collector is an investor. If that weren't true, price would be of NO concern. NO ONE is happy to pay money for a coin (no matter how nice) if a better one is to be had cheaper and even less so if many, MANY superior specimens begin to reflect a genuine downtrend.
Market conditions make themselves known in many ways.
I wish all coins would appreciate 5% per year forever, but they won't. Some may do thousands of percent and some may flop and never get up.
We aren't real "collectors." Real "collectors" collect rocks. Or other things that can be COLLECTED.
We like to THINK we collect, but in reality, purchased things are investments in the purest sense of the word.
Demographics and economics rule this ...... hobby. Always have, always will.
For those of you who call yourselves "pure collectors", which ones would be willing to spend $5000 plus on a coin that you wanted very badly (even one worth 10,000 today) if you knew that you would never be able to get even $1000 back from it?
Although not every coin is purchased with the intent of making a profit I would not even consider spending real money on any coin that would, like a motor home, TV etc, eventually depreciate into worthlessness. It would really detract from the "Joy of collecting" knowing that I was wasting my families financial security.
Even the "pure collector" cuts the check feeling reasonably confident that they purchased more than just the entertainment and enjoyment of collecting
What about those who buy Coin World or memberships in the ANA. Those are not generally appreciating assets?
Or even the various charity auctions and the ANA summer seminars?
By the way, nice chat we had.
And, I agree 100%. I refuse to throw down money for a coin with the thought that hey this will probably be worthless or worth a whole lot less one day. That would make the hobby very un-enjoyable for me.
<< <i>coynclecter:
What about those who buy Coin World or memberships in the ANA. Those are not generally appreciating assets?
Or even the various charity auctions and the ANA summer seminars?
By the way, nice chat we had. >>
That dealer's name SHOULD BE POSTED for us to stear clear from someone like that. I mean, you guys (and gals) post a scam E-Bayer like no tomorrow, but why protect a dealer like that??? It is those dealers that should be exposed, and give a bad name to the other ones.
Is that not what the forum is for? Help each other out on coin info, and what to look and LOOK OUT for???? If a dealer did that to me, you all would know who it was.
-----Lloyd
PS Lincoln high grade/low pop, and key date/high grades still very bullish, breaking records...
Marc
The show itself was very busy for me. I noticed common date CC's were soft, along with common date MS66-MS67 Washington Quarters, generic Morgans and short set Walkers. What moved well for me was classic Commems, attractively toned coins and type. I deal in mid range coins, not the high end market that Bear is describing, so I'm not contradicting his observations. However, I did sell plenty of coins in the $300 to $3000 price range, so that should give you an idea of the basis for my observations. I was very pleased with the show overall, as I picked up several new clients, along with having current clientele buy coins. I really believe strong customer service skills is a huge plus in this business. In regards to a possible downturn in the market, I would say the market is adjusting to all the auction activity, cash flow issues and is just becoming more selective. As always, if you stick to attractive coins, you should do well. For the time being, based on my business activity, classic commems and quality type coins appear to be the best havens. Hope these observations are helpful.
The coin market is composed of numerous segments that have their
own special dynamics. I observed some warning flags that bear watching.
The Baltimore Show should be able to give a clearer indication of what the
future holds. As each reporting dealer and collector views the market from
their own special perspective it is usually the sum total of these reports that
gives the Forum members at least some ideas of the state of a very complex
market place. I believe for some LB was a good show, but for many they are putting a good
face on a generally lackluster show. Perhaps not every show can hit a home run.
Sometimes to win the game
takes a bunch of singles, scoring fly balls and walks. Remember my report was made on Thursday,
different days can modify impressions of the beholder.
Camelot