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I think metals at current prices are ruining the hobby
Elcontador
Posts: 7,743 ✭✭✭✭✭
One joy I had as a new collector was finding neat old coins in change. They weren't worth very much and were pretty beat up, but occasionally, I'd find a good or very good Barber coin, and it made my day. Also, I could buy a worn Seated coin in such condition without problems if I did extra chores around the house, delivered newspapers, etc. I remember winning an 1877 P Half in G or VG for a couple of dollars at a Bidboard.
Now, for collectors on limited budgets, these coins are being / have been melted. Mea culpa, as I unloaded whatever material like this I had for melt in 1980.
On the higher end of the food-chain, people are confusing bullion gold with numismatic gold, and marketers are trying to make a quick buck by doing this.
To the extent I collect U.S. coins, the price of metals is irrelevant to me. I am not affected by the bullion price of gold, as I do not collect gold coins, and the silver coins I collect are numismatic coins which are not affected by the price of silver.
Your thoughts are welcome.
Now, for collectors on limited budgets, these coins are being / have been melted. Mea culpa, as I unloaded whatever material like this I had for melt in 1980.
On the higher end of the food-chain, people are confusing bullion gold with numismatic gold, and marketers are trying to make a quick buck by doing this.
To the extent I collect U.S. coins, the price of metals is irrelevant to me. I am not affected by the bullion price of gold, as I do not collect gold coins, and the silver coins I collect are numismatic coins which are not affected by the price of silver.
Your thoughts are welcome.
"Vou invadir o Nordeste,
"Seu cabra da peste,
"Sou Mangueira......."
"Seu cabra da peste,
"Sou Mangueira......."
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When the dust settled prices fell back drastically and a lot of these guys lost a lot of money. That sent them off screaming that the coin hobby was controlled by crooks and gave the entire numismatic dealer profession a black eye. Yes, there were con artists selling coins back then, but much of blame for those folks losing their money was their own fault. They jumped in with little expertise and no sense of the market. ANYTHING can be a bad investment if you over pay for it. That’s something that some people never seem to learn.
That didn't come out right did it?
The name is LEE!
To follow up on Lee's thought, any worn common date coins that don't get melted will become scarcer, and possibly more collectible.
I also don't believe that high metals prices causes coin collecting to be associated with criminal promotions any more than owning shares in IBM during a rising stock market causes stock ownership to be associated with corruption on the NYSE.
In fact, high metals prices may very well serve to wake more people up to the existance of coin collecting in the long run.
I do agree with Bill Jones that, "ANYTHING can be a bad investment if you over pay for it."
I don't necessarily agree with ElContador, "On the higher end of the food-chain, people are confusing bullion gold with numismatic gold, and marketers are trying to make a quick buck by doing this."
Fact is, premiums for both Modern (bullion) gold and graded numismatic (classic) gold change all the time and vary with the market. In addition, the collectability of Modern (bullion) gold is not in question, as it has it's own following of market enthusiasts and many of these pieces have developed premiums, no different than classic gold.
I knew it would happen.
<< <i>I think metals at current prices are ruining the hobby >>
I'm not old enough to remember (was just being born at the time), but I'd imagine some folks said the same thing back in 1964-'65.
Collector since 1976. On the CU forums here since 2001.
Yes, a very few collectable coins are being melted. However, most collector coins are being hoarded by the armies of silver hoarders, and the many coin collectors. It is mostly culls that are disappearing, not the "good stuff." There are not long lines of people selling silver coins. Dealers mostly report an equal amount of silver buyers, so most of the 90% that comes in, gets resold, not melted.
Many dealers have concentrated their capital in bullion sales, as that is what the man on the street thinks he can buy without any experience. Questionable whether these buyers would be in coins, scarce to rare, but it has to lessen the total amount spent in our "hobby".
Some long time dealers believe that eventually, a small number of these buyers will turn to coins, but that still takes a lot more knowledge than 1 ounce from the mint.
It will be inflation that drives up the value of this collectible, or just a few well heeled whales who see the light, and buy rarities.
In honor of the memory of Cpl. Michael E. Thompson
Just spent $27.34 at the market and not a coin came home with me.
<< <i>I'm gonna vote silly post. Its been about 40 years since silver coins circulated. As far as prices, middle class and richer white kids (and those are the only kids that tend to collect) seem to have more money today than ever if their parents are still working. The op probably got an allowance of about 25 cents a week back in the day, and had to save up for a month or two months to buy that Seated half. Today $20 is not uncommon for allowance money, and that half might be bought on a single week's allowance.
Yes, a very few collectable coins are being melted. However, most collector coins are being hoarded by the armies of silver hoarders, and the many coin collectors. It is mostly culls that are disappearing, not the "good stuff." There are not long lines of people selling silver coins. Dealers mostly report an equal amount of silver buyers, so most of the 90% that comes in, gets resold, not melted. >>
Agree with Red Tiger here. Nostalgia is great and all, but let's get real. Even if silver prices went back down tomorrow, you still wouldn't find any more silver coins in circulation than today, which is virtually none. And I can tell you from personal experience that most guys don't need to blow out 90% right now; it goes back out the door pretty regularly. In fact I just sold some prior to this post.
That said, I do think that metals at current prices are pulling significant amounts of money away from the collector coin market- with an assist from the U.S. Mint and their change-the-price-weekly offerings.
RIP Mom- 1932-2012
<< <i>The thing that concerns me most is the amount of high-priced product the Mint puts out every year. Gold, platinum and now this year, the hockey pucks. This pulls large numbers of dollars out of the pool of money collectors spend on coins. This has to have a dilution effect on the overall coin market. Is this a sustainable model? >>
I think that a lot of collectors learn that many, but not all, of the items that the mint issues every year are less than wonderful buys. I keep up with Proof sets on a year by year basis, but they losers for the most part. Even the "good sets," like 1999, have not held their value after reaching some impressive highs. Platinum coins have dead as collectors’ items for most collectors, and the poor price performance for most of the modern commemorative series has been poor. Only in the last couple of years, as the melt price has risen have the gold and silver commemorative coins and platinum seen the light of day, price wise. Ditto for the First Ladies commemorative coins had not been for the gold prices.
I think that a lot of collectors learn their lessons about most modern issued products after a while and I don’t see them as a major drain on the market.
Most shops aren't going to bother looking through this stuff. They'll make more money getting them melted than from paying someone to go through this material and separating out what goes to the smelter and what goes to the bargain bin.
I don't know what % of the monies going into bullion products would otherwise go into numismatic coins, but the amount is more than zero. At this point, our hobby needs to be supported by buyers of numismatic coins, not be confused with bullion and bullion related mint products.
FWIW, if a shop makes most of its money on the spread re bullion products, then it's not really a coin shop
"Seu cabra da peste,
"Sou Mangueira......."
<< <i>I think metals at current prices are ruining the hobby >>
I have my doubts. That's like saying..coffee at current prices are ruining the coffee market
It's got all the makings of a trap.
To others it's an opportunity.
The price of metals is a contributing factor for some different reasons that are almost at odds
Silver coins are being melted that did have collector interest or were made for collectors-
As silver climbs, more coins that should not be melted will be melted
It hurts collectors with a budget
What will hurt more is the volitility and the herd mentality as to what to buy and not to buy and it all seems so short sided with very little thought
Experience the World through Numismatics...it's more than you can imagine.
not be out there spending that money on collector coins. And for those buying bullion at least they are putting that money into the coffers of the hobby's dealers to keep
it viable until the recession ends.
High metal prices are not directly ruining the hobby. In fact they are one of the few things keeping it afloat otherwise 20-50% of B&M's would have closed already.
High metal prices are a symptom of other problems. It's those problems that are ruining the hobby.
Even after the Great Melt 2 ends, circ and BU silver dollars, 90% silver coinage, and 1964 proof sets will still be common as dirt. You'd have to melt 90-95% of that stuff to actually
make it semi-common. In my mind numerous collector coins are now more affordable than they were just 3 yrs ago. While that may not be anything related to bullion, I'm sure
there are many collectors rejoicing their increased purchasing power in their particular series.
roadrunner
Positive BST Transactions (buyers and sellers): wondercoin, blu62vette, BAJJERFAN, privatecoin, blu62vette, AlanLastufka, privatecoin
#1 1951 Bowman Los Angeles Rams Team Set
#2 1980 Topps Los Angeles Rams Team Set
#8 (and climbing) 1972 Topps Los Angeles Rams Team Set
<< <i>
As silver climbs, more coins that should not be melted will be melted
>>
Good example was that seated quarter someone posted here a couple of weeks ago that they rescued from a pile of coins that were being prepared to melt. There are very nice coins meeting their demise that are being sent in to dealers buying bullion from people that do not know what they have.
Positive BST Transactions (buyers and sellers): wondercoin, blu62vette, BAJJERFAN, privatecoin, blu62vette, AlanLastufka, privatecoin
#1 1951 Bowman Los Angeles Rams Team Set
#2 1980 Topps Los Angeles Rams Team Set
#8 (and climbing) 1972 Topps Los Angeles Rams Team Set
<< <i>I think metal prices are saving the hobby form the recession but in the process pricing out some of the last generation collectors and scaring away some new ones while the median average collector point in the hobby moves slightly up the economic ladder. Used to be a normal working man could put together a great collection, I don't see that happening very often anymore unless there is a crash in our hobby. >>
together in the 1970's that started a new "inflationary" era in coins and collectibles. Gold has resurfaced again over the past 10 yrs after a 30 yr absence. But our hobby wouldn't be
what it is today without the inflationary boost from the 70's and 80's. If not for that we'd be collecting just like it was the 1950's all over again. Most of us wouldn't even be here
because it was probably the allure of silver and gold coinage that got many of us hooked on coins over the past 10-50 years.
No high metal prices in the 1960's and 1970's would have meant no modern coin hobby today.
roadrunner
I don't know about that "half the B/Ms would close" statement, but I can say speaking personally that things like 90%, 40%, junk dollars, scrap and bullion are what have kept us profitable lately...if we had to rely strictly on our sales of collector coins, particularly over the past year, we'd be hurting a bit. Some collectors are still spending, but they are buying far lesser amounts and are being super picky about what they do buy. Some even talk themselves out of things they previously said they'd buy. We've also had regulars who are throwing back bullion or related stuff in lieu of working on their numismatic collections. Thus my earlier comment about this market sucking capital away from the numismatic market. So, if I had to generalize, I'd say that bullion/bullion related stuff is paying the bills right now for us and I suspect, many others (including some that might surprise you).
RIP Mom- 1932-2012