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My theory of "dreck saturation"
shorecoll
Posts: 5,447 ✭✭✭✭✭
A few people were commenting that small coin shows have slowed in activity.
I have been predicting for about 10 years that eventually the millions of people who have been buying dreck from eBay, low-ball dealers, country auctions, flea markets, etc. would realize that they have been hosed and just stop buying. I know that there's a market for everything and that many people choose to collect lower-end material (in fact sometimes thats me, and it used to be me a lot), but many low-end collectors have been lied to, some of those venues specialize in overgraded, low-end doctored and even fake stuff (tell me again how an auctioneer can disavow responsibility for selling counterfeit US currency?). When the economy turns down, many of those people for the first time may have tried to sell some of that stuff and had their eyes opened. Usually they blame the final dealer that tells them the truth, but could it finally affect the whole low-end market?
As a business analyst I truly believe that eBay is and has been the greatest facilitator of fraud in human history. Note, I didn't say they did it, just that they facilitated it. Most cops I know (2 currently in the family and my daughter studying to be one) refer to eBay as America's Fence.
Is this saturation and awakening finally happening, or is this just another cyclical downturn?
Fire away!!!
Edit: shows in first line
I have been predicting for about 10 years that eventually the millions of people who have been buying dreck from eBay, low-ball dealers, country auctions, flea markets, etc. would realize that they have been hosed and just stop buying. I know that there's a market for everything and that many people choose to collect lower-end material (in fact sometimes thats me, and it used to be me a lot), but many low-end collectors have been lied to, some of those venues specialize in overgraded, low-end doctored and even fake stuff (tell me again how an auctioneer can disavow responsibility for selling counterfeit US currency?). When the economy turns down, many of those people for the first time may have tried to sell some of that stuff and had their eyes opened. Usually they blame the final dealer that tells them the truth, but could it finally affect the whole low-end market?
As a business analyst I truly believe that eBay is and has been the greatest facilitator of fraud in human history. Note, I didn't say they did it, just that they facilitated it. Most cops I know (2 currently in the family and my daughter studying to be one) refer to eBay as America's Fence.
Is this saturation and awakening finally happening, or is this just another cyclical downturn?
Fire away!!!
Edit: shows in first line
ANA-LM, NBS, EAC
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Comments
eBay cannot possibly monitor EVERY auction listing, and some (ok, A LOT (in quantity), although in the overall scheme of things a very low %) counterfeits get through.
People use eBay to promote their items. Some are closer to the truth than others, while some listings and descriptions are A LONG way from that truth.
While I really cannot find fault with anything you mentioned, there's other sides to the story.
Small coins are small in value because they exist in such high quantities and don't get the
interest that 'more important' coins get, which are then subsequently sucked-up from the
market and what you are left with is an illusion that only 'small coins' are left for everyone
to look and and buy/pass.
That's my take
I would ask what evidence, other than anecdotal, do you have to support your theory? As an analyst, you should know that correalation IS NOT causation.
You decry ebay for "facilitating" some kind of fraud because they sell "dreck" to unsuspecting buyers. My response is: what business is it of yours (or anyone else) what people buy and sell as long as it's legal?
ebay is not,cannot be,the cops.Return the item for refund if unhappy with it as PayPal is your friend on ebay.
Educating oneself is the key to successful coin collecting/inv$%#ing.
"Two things are infinite: human stupidity and the universe; and I'm not sure about the universe."
-Albert Einstein-
Mistakes are natural. But repeated mistakes without reflection are something else. That may be the “stupidity” he was referring to. In research, he admitted uncertainty openly. “If we knew what it was we were doing, it would not be called research, would it?” This shows humility. Even a Nobel laureate accepted doubt. That humility makes the quote less cynical and more observational.
I'm looking for other people's opinions, not to issue my own final ruling.
<< <i>My point on eBay is that it has such massive reach, not that it's any worse than a flea market dealer selling whizzed AGs as VF, just that it can do that 2 million times before the population figures out what's happening.
I'm looking for other people's opinions, not to issue my own final ruling. >>
Allow me to try and walk through your logic:
1) ebay is a huge venue for buying and selling coins
2) the more people engaged in buying and selling coins, the greater the opportunity for people to "get burned" on a bad coin
3) the more people who "get burned" on a bad deal = more people who drop out of the coin market.
4) ergo, ebay is wrecking the "small coin" market by facilitating the market for "dreck"
This line of reasoning is false logic. It's known as: post hoc ergo propter hoc.
It's akin to saying:
1) The rooster crowed
2) The sun rose
3) Therefore, the rooster caused the sun to rise.
Do you see the problem with this kind of logic? It completely ignores other reasons for the causation.
<< <i>new collectors have been taken in one way or another for generations, while Ebay is new the uneducated collector phenom is not. >>
Agree---Nothing new here. Dealers have been selling and over charging new collectors for dreck and problem coins ever since people started paying more than face value for coins.
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
Coins are just a small part of the fake picture. Virtually every collectible category is plagued with them.
As for shows, part is the economy, part is the easy access to the Internet, part is the time crunch for those still with decent income. Those without income, the underemployed, or on fixed income (bank CDs) are being squeezed and have little left over for coins. Part is an expansion in the number of shows past the point of saturation. Part may be due to mint new issues taking money out of the show circuit. Those profiting from flipping often spend their money with online dealers, not show dealers.
you know....the average joe collector does NOT go to coin shows, he does NOT reply to ads in Coin magazines, he does NOT belong to a coin club.
its a secret passtime and now ebay and the internet have opened up a WHOLE NEW WORLD.
and yes sometimes people get taken advantage so what else is new? use common sense and most of the time you will be just fine.
dreck is what entry level collectors buy who think they are getting a bargain. it is what the pros leave untouched. even bowers recognized and wrote about this FACT.
you were once an entry level collector and you bought dreck. so did I. we all did.
whaaaa whaaaa whaaaaa
Now many of those people are looking to sell their coins and have few outlets available unless they are willing to take a pounding on price. If they
had bought bullionesque silver and gold drecked coins they probably would have made out ok. I don't think it's so much an Ebay issue as it is the end
of a credit/debt-based system as we currently know it. Most things are getting washed out over the next 5 yrs, dreck included. My favorite muscle cars from the '68-'70
era are now down some 40-60% from the 2007 peak with anything but the very best and realistically priced cars being semi-illiquid. It's not just about coins.
Probably 90-95% of the "collector" cars out there are "dreck" as well in the scheme of things. Try to sell one today. Most collectibles are dreck and even the
few that aren't are tending to lose value in the current market. There can only be so many Mr. Simpsons to help keep various markets supported.
roadrunner
I still buy on ebay occasionally - but only from sellers in the general area. I send them a message that I'm interested and will pay cash. I meet them, the deal is made, and I drive off with my item.
Sellers like it because they avoid the fees (they simply let the item auction end without a buyer if my offer is not exceeded). I like it because I don't have to pay for shipping, and I can examine the article prior to pulling the trigger.
Frankly, I buy more items through Craigslist than ebay these days.
Note that the 'items' I describe are not coins.
I agree with the OP - if you buy coins on ebay, your odds of buying a substandard coin are huge. If you put some work into it and research the seller, you can dramatically reduce the chances of buying a substandard piece. It's a lot of work - easier to buy from dealers or go to shows.
<< <i>
<< <i>new collectors have been taken in one way or another for generations, while Ebay is new the uneducated collector phenom is not. >>
Agree---Nothing new here. Dealers have been selling and over charging new collectors for dreck and problem coins ever since people started paying more than face value for coins. >>
Exactly.
<< <i>Please define "small coins" in your first line. >>
25-30 tables or less. oops........
The coin was in a reputable third party graded holder but didn't measure up to my standards.It took me less than 30 seconds to decide that a return was in order.
Dealer got the coin back,I got a prompt refund.A newbie to collecting would probably have kept the coin thinking they had obtained something great at a great price.
Go to sell a coin like the one I bought and returned,then a lesson is learned by the newbie to collecting who has been thinking the grade on the reputable holder is the gospel.
"Two things are infinite: human stupidity and the universe; and I'm not sure about the universe."
-Albert Einstein-
Mistakes are natural. But repeated mistakes without reflection are something else. That may be the “stupidity” he was referring to. In research, he admitted uncertainty openly. “If we knew what it was we were doing, it would not be called research, would it?” This shows humility. Even a Nobel laureate accepted doubt. That humility makes the quote less cynical and more observational.
Many members on this forum that now it cannot fit in my signature. Please ask for entire list.
<< <i>ebay is the greatest thing to come along in coin collecting in thirty years. TPG grading, the internet...and ebay.
you know....the average joe collector does NOT go to coin shows, he does NOT reply to ads in Coin magazines, he does NOT belong to a coin club.
its a secret passtime and now ebay and the internet have opened up a WHOLE NEW WORLD.
and yes sometimes people get taken advantage so what else is new? use common sense and most of the time you will be just fine.
dreck is what entry level collectors buy who think they are getting a bargain. it is what the pros leave untouched. even bowers recognized and wrote about this FACT.
you were once an entry level collector and you bought dreck. so did I. we all did.
whaaaa whaaaa whaaaaa
Last year, I put a post up about a guy I refer to as "The Millionaire Bottom Feeder." He was an expert at buying dreck, and made tons of money on his investment after he passed away.
You see, the phrase you cannot overpay for quality is BS - YOU CAN. On the other hand, let's say that you have a 1909-S VDB Lincoln Cent with VG Details, corroded, a staple scratch on the obverse, and for good measure someone dipped it in copper cleaner. If you bought this thing for $20.00, you ripped it. If you paid 50% of Good bid for it, you're buried.
I have $5 coins that are not dreck,in my opinion.
"Two things are infinite: human stupidity and the universe; and I'm not sure about the universe."
-Albert Einstein-
Mistakes are natural. But repeated mistakes without reflection are something else. That may be the “stupidity” he was referring to. In research, he admitted uncertainty openly. “If we knew what it was we were doing, it would not be called research, would it?” This shows humility. Even a Nobel laureate accepted doubt. That humility makes the quote less cynical and more observational.
<< <i>can someone define dreck? Is it a term for low end coins worth $50 and below or ?? >>
It's like porn, you know it when you see it. To me dreck signifies poor eye appeal either by marks or spots/stains or that really washed out look.
<< <i>A few people were commenting that small coin shows have slowed in activity.
I have been predicting for about 10 years that eventually the millions of people who have been buying dreck from eBay, low-ball dealers, country auctions, flea markets, etc. would realize that they have been hosed and just stop buying. I know that there's a market for everything and that many people choose to collect lower-end material (in fact sometimes thats me, and it used to be me a lot), but many low-end collectors have been lied to, some of those venues specialize in overgraded, low-end doctored and even fake stuff (tell me again how an auctioneer can disavow responsibility for selling counterfeit US currency?). When the economy turns down, many of those people for the first time may have tried to sell some of that stuff and had their eyes opened. Usually they blame the final dealer that tells them the truth, but could it finally affect the whole low-end market?
As a business analyst I truly believe that eBay is and has been the greatest facilitator of fraud in human history. Note, I didn't say they did it, just that they facilitated it. Most cops I know (2 currently in the family and my daughter studying to be one) refer to eBay as America's Fence.
Is this saturation and awakening finally happening, or is this just another cyclical downturn?
Fire away!!!
Edit: shows in first line >>
I give away money. I collect money.
I don’t love money . I do love the Lord God.
However, this is another, more basic problem. People less familiar with principles of numismatics that we take for granted--like grading by PCGS or NGC instead of obscure or home brew companies that are off by three to five points, or have graded the ungradeable--actually make up the bulk of coin buyers. Most collectors are casual collectors. It's not any difference in intelligence so much as familiarity; just about all of us start out just as vulnerable.
We are born and raised as consumers; we grow up around collectible toys and discard them for changing music tastes and revolving clothes style. It is natural to carry this mind-set over and an uphill battle to relearn other ways of thinking. One particularly bad notion that most people bring with them as they go into the idea of bargain hunting. Except for the occasional cherry pick, where one finds something a seller did not know he or she had, there really are no price breaks. There are coins likely to gain value, but not coins that are worth $2000 going for $500. People are also used to quantified numbers. Coin grading is very subjective and qualitative. You have to know what you are doing to grade on your own and get it right. Most of us have to trust the label on the holder at least in part in our buying decisions. But, a novice will usually follow conditioned behavior to focus too much on the label itself. Thus, people might favor the cheaper coin with the same grade as the more expensive one.
But, worse than that, coin doctoring, counterfeiting, and abuse of dipping to the point of essentially being more coin doctoring, has created a large glut of coins that look flashy, appealing to the untrained eyes and standing out over the more muted but superior coins.
In the best case situation, unless you're in TDN's league, you leave 10-5% on the table with every coin you buy, and with every coin you sell. This is magnified when dealing with a low end for the grade product. I sincerely believe that most material offered to the retail collector is at best, average for the grade, unless said collector knows people and has first shot at a particular coin.
You can do the math.
"Seu cabra da peste,
"Sou Mangueira......."
<< <i>
<< <i>Please define "small coins" in your first line. >>
25-30 tables or less. >>
Yes, he corrected it. It originally said "small coins" rather than "small coin shows."
A rare Chain Cent is a cool thing to own regardless of it's condition. An 1880 business strike Shield Nickel is still a rare coin whether it has been cleaned or not.
IMO people have stopped buying low level coins because the economy has forced the buyers of such coins to pay their rent and eat instead. The people with money to buy coins have been focusing on higher quality material - hence the outrageous prices we are seeing at auction on the really nice stuff. The well-heeled do not want lower quality coins and the people who want lower quality coins cannot afford them. Listen to the coin show reports - average collector coins are not moving because average collectors do not have any money - and really nice coins are being fought over by people with lots of money.
When the economy recovers low level coins will sell again. These "dreck" buyers love the same coins we do but realize that they will never be able to buy anything but lower level coins. I for one - which I was told was a mistake - preferred good detailed Large Cents with a problem or two over a perfect coin at a lower grade level because I wanted to see the detail and couldn't afford both detail and perfection.
Based on what we see on these boards no one agrees on the grade of any coin, whether it is NT or AT, whether it was dipped or cleaned etc. So if we all got to get rid of the "dreck" in the world how many coin collectors would there be left able to buy the coins that were left?
Precisely. And this is why dealers have had trouble getting nice coins during the recession---they're in strong hands. Talk to small B&M dealers---what they see walk in are common mint products, bullion-related items, inexpensive collector coins (usually low-end) and old jewelry. Gold/silver-related trading is what is keeping most small coin shops in business.
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
<< <i>can someone define dreck? Is it a term for low end coins worth $50 and below or ?? >>
When you talk low price, you confuse dreck with widget.
I don't think eBay or a flood of low quality, problem coins has anything to do with it.
Ebay has scams but I bought hundreds of raw and graded coins and only a few were not what I wanted or expected. I was careful and didn't go for the rip offs, some turned out to be cherries and some were average. None that I cried over. B&Ms sell junk too, there are good and bad deals everyplace.
Almost everything is down today, I buy less coins and sold off stuff I didn't want.
I'll agree some small/mid size shows are pretty slow. The last one I was at made me wonder if tables were worth the cost for the dealers.
It's a cycle, someday it will reverse. It won't be soon.
I don't blame dreck or ebay for most of the issue.