Recession?? . . . Affect on Coin Collecting and Investing??

jimmymac · October 30, 2007 7:53AM

there's been a lot of talk about the economy going into a recession - how would this affect the rare coin world - good or bad?? and how are you going to handle your coins and future purchases knowing that a recession might be on tap?

bidask · October 30, 2007 8:06AM

I would probably buy more depending on prices which I would expect go lower.

mrearlygold · October 30, 2007 8:06AM

"Going" in ?

ricko · October 30, 2007 8:32AM

Ah the paranoia..... the sky is falling... here we go again. Just manage your finances, be aware, and do not panic. Cheers, RickO

claychaser · October 30, 2007 8:53AM

Is the coin market mostly influenced by the flow of money coming in and out? I think so. If you compared the value of all the stocks vs. real estate vs. coins, I believe that coins would be tiny in comparison. So, based on that trail, small amounts of money coming in from those areas can have a huge impact on the coin market. Have we seen money from real estate come in? How much money coming into the market is from previously cheap interest home equity lines? How much money has gone out with the tons of new and expensive mint gold and platinum issues, or are these outside of the "real" coin market?

In this credit crunch, will coin people sell what they can (coins) instead of what they should have (poorly bought real estate)?.

On the other hand, money has come in during the past during inflationary times. Just look at 1977-1979. Is the dollar decline vs. the Euro, and oil a repeat? Those were the days when coins skyrocketed.

Will history reppeat itself? Stay tuned......

bluelobster · October 30, 2007 10:28AM

Although I would agree by current definition we could have a recession .....all recessions are not created alike. This slow down is accompanied by inflationary pressure as manifested by surging commodity prices, specifically metals prices(among others) and a devaluing dollar, so you could make a reasonable case that while average americans might have less disposable income to spend, other factors might actually cause a higher revaluation in the coin market. especially in the more investment oriented sectors of the coin market.
Of course, economic theory makes psychology look like a black and white science

Bear · October 30, 2007 10:53AM

Prices will increase due to dealers and collectors being only

willing to accept coins that are under graded by 1/2 to 1 point.

Nothing like a down market to tighten grading all up and down the line.

This will include the grading companies. It will take more

of a coin to bring the price at any grade from XF on up.

Coxe · October 30, 2007 11:02AM

Tough call and it would depend greatly on WHAT coins you are dealing with. Here are my thoughts, valid ot invalid.

1) Average Joes and Janes collecting with modest bidgets would, naturally, reduce their spending on average commensurate with their reduced discretionary funds.

2) Dealers need to eat too and their transactions do account for a lot of the economic activity that builds the market momentum. I think the full-time guys would become increasingly selective with an eye on the exit for each and every piece they consider. Languishing inventory is unacceptable.

3) The Mint-direct program would be destroyed UNLESS bullion speculation becomes extremely strong. The typical customer, not the flipper or the dealer, would buy the needs over the wants. In a strong bullion hedging economy, certainly many investors would be parking their dinero in gold over the riskier and inflation-murdered alternatives.

4) Top of the heap collectors probably will be as active as ever and probably moreso. The occasional piece entering the market from an individual or entity that has failing finances elsewhere and needs the redemption, will be like chum to those foreclosure sharks. This goes triply for the dealers at that tier of the market.

Zoins · October 30, 2007 3:45PM

I predict SHQ circulation collecting will be as strong as ever

That's just for collecting, not investing.

Unknown · October 30, 2007 4:01PM

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lava · October 30, 2007 5:15PM

A change in the economy will affect different people differently.

If you are uber upper class, you have money to burn in any economy, so speculators in this class would be buying before anything got too cheap. Whether this is enough to stabilize prices depends on the supply.

I don't pretend to understand the coin market. In a bad economy or good economy, there always seems to be big dollars chasing coins.

Just my guess, but I don't see a major correction anywhere in coins.

phillymatt · October 30, 2007 5:36PM

<< <i>Wooden nickels will triple in price. >>

That means I'm out!

Rob790 · October 30, 2007 5:40PM

One, we ARE already in a recession with stagflation. Here's a video from a guy that knows a thing or two.

Jim Rogers on the dollar and recession

Two, with a collapsing dollar, gold and silver will be trading well and rising in value. So the bullion market will be as strong as ever.

I agree with most that the top market will stay relatively strong but the bottom will lag.

But this recession will be worse than the 30's since we are now as a nation and as people in FAR more in debt. I don't really think anyone really knows just how things will play out.... even the people who planned for all this to happen and destroyed this once great country.

Rob

hubird · October 30, 2007 7:13PM

I plan on selling a few of my coins and buying a few others, refining my collecting as I go.

ModernCrapNut · October 30, 2007 10:10PM

It looks like credit card companies may be getting ready to tighten up their standards a little. Link If that happens it will have some effect on the coin market with reduced buying available to those already carrying too much debt on their cards. I think most of the effect from this that will be seen is less "stupid money" being paid for coins.

shorecoll · October 30, 2007 11:47PM

If the recession does occur and does hit the middle and lower tier coin buyers, buyers of eBay schlock like cleaned and other problem coins may all run to sell. What will be the effect if thousands of these people start trying to dump their junk at the local B&M shop and all realize at the same time that they've been had? Could be interesting, as in the Chinese curse "May you live in interesting times!".

garsmith · October 31, 2007 12:05AM

I'm not a dealer I'm a collector so coin prices dropping is a good thing for me!

The only things I'm selling are those I have upgraded from and I can hold those until there is a recovery!

aficionado · October 31, 2007 12:39AM

The third quarter grew by 3.9%.

By definition a recession is two quarters of negative growth. So the earliest we could have a recession is the end of the first quarter of 2008, six months from now.

pharmer · October 31, 2007 1:25AM

<< <i>The third quarter grew by 3.9%.

By definition a recession is two quarters of negative growth. So the earliest we could have a recession is the end of the first quarter of 2008, six months from now. >>

Ah, a needed dose of reality to all this doom and gloom. The economy is good, and folks are missing it. You can always cherrypick an area here or there that isn't doing well, and you can always predict a recession, because it's bound to happen someday, some year.

Bear · October 31, 2007 2:59AM

The sky is falling !

I heard it directly

from Henny Penny

and Loosy Goosey!

Recession?? . . . Affect on Coin Collecting and Investing??

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