Vibrant Coin Market Looks Probable for Years To Come!

[VDB Coins]

But sometimes it is all about the money! The recent sale by Stacks Bowers of the 1794 SP66 PCGS-CAC Flowing Hair silver dollar -- quite likely the first silver dollar ever struck by the U.S. Mint, judging by its die state which matches a copper pattern strike in the Smithsonian -- brought a world record for any coin, U.S. or foreign. The winning bid by Legend Numismatics (Laura Sperber-Bruce Morelan) was $8,525,000, which with the 17.5% buyers premium works out to $10,016,875! This tops the 1933 double eagle sold a few years ago for $7,590,020 by Stack's and Sotheby's. Third place goes to a 1740 pattern Russian ruble which brought more than $4 million last fall.

The sale of the first $10 million-plus coin has important implications for the many, many coins of the United States that are in the six- and seven-figure range (in other words, $100,000 to anything below $10 million). The market for these coins is vibrant, and we are seeing buyers who have never before purchased a coin come into the market. These are mega-rich individuals who are seeing prices of $35 million for contemporary paintings, so spending several million dollars on the finest U.S. coins is no big deal. It should be noted that the Asian buyer of the aforementioned 1933 double eagle was a person who is not even a coin collector or numismatist.

Given the U.S. government's and other governments' around the world -- Japan, Euroland, China -- attempts to deflate their currencies in order to make their export goods cheaper to foreign buyers -- the "race to the bottom" -- there is considerable and mounting evidence that much of that paper money is flowing into alternative assets. Gold, silver, commodities, and rare coins are near the top of the list, but the finest rare coins are a special case.

The next famous rarity coming up to our knowledge is Heritage's sale of the George O. Walton 1913 Liberty nickel at the Central States show in Chicago. Only five 1913 Liberty nickels were made under clandestine and mysterious circumstances, likely in 1912 before the changeover to the Buffalo nickel. A Mint worker named Samuel Brown first exhibited one for sale in 1919 and then advertised all five for sale in 1920, after the statute of limitations had expired. Graded PR63 PCGS, this is the famous coin that was once part of the Colonel Green estate, then went to Burdette G. Johnson and Eric Newman (now age 101.5). CORRECTION: It was one of three sold to James Kelly in 1943, and Kelly soon sold it to Dr. Conway A. Bolt who traded it to "Reynolds." Apparently Walton traded for it in 1945-46 for about $3,750 from the Reynolds family of North Carolina END OF CORRECTION Walton died in a car wreck in 1962, and his 1913 Liberty nickel was recovered along with hundreds of coins at the crash site. The coin went to his sister Melba Givens, who was falsely told that it was a fake, a counterfeit (due to the anomalous 3 in the date, which anomaly all five examples share). She stashed it away in a closet for 30 years. Upon her death, it went to her children, who brought it in 2003 to the ANA Convention where it was finally reunited with its four siblings. The "missing fifth 1913 Liberty nickel" was rediscovered! It has never before been offered for sale, either privately or via public auction. Heritage puts a conservative estimate on it of $2.5 million, but it is one of the Ultimate Trophy Coins and we would not be surprised if it brought twice that amount. Two of the other pieces are in museum collections, leaving only three available on the marketplace.

As in any market, those who profit most -- aesthetic enjoyments as well as financial rewards -- will be those who do their own homework. But decide for yourself what bargains are to be had. We think the Canadian coin market is really underrated and underpriced, and many American collectors of more modest means are flocking to those coins at U.S. coins get more and more expensive. Truly rare U.S. gold is also seeing unceasing demand. British coins and Russian coinage are also hot markets.

But overall, we think the current market environment, both fiscally and politically, shows a numismatic marketplace that will likely remain healthy and vibrant for many years to come! Happy collecting everybody!

Best Regards, 

George

[coinsarefun]

I absolutely agree with you George and have felt this way for the last 5 years.
Even with the downturn in the economy the coin market for higher grade and rarities
are only going up in value. My personal experience is this:

1) Since I sold off most of my lower and moderate priced coins and started a US type set.
I paid for a few of my coins double or more for them and in the last year now see that they have already caught up to the prices I have paid. So I definitely see a trend.
2) The Russian market has been hot for the last 8 years. Last year it had a moderate slow down but is back to being hot. Again, this is pertaining to key or semi key dates and or high grade examples. Having purchased most of my Russian coins several years back I am seeing most if not all have doubled or tripled in price. Some which are Novodels can not be confirmed as there are very few and when they are sold they are held for a long time, just as I am doing with mine.
3) Canadian market......I am not that experienced as I have owned several pieces but sold them when I sold the other part of my collection but I did not take a loss on them as I did on some US coins, rather I doubled my money. So I would concur based on my short experience.
4)The recent large coin auction for the 1794 SP66 PCGS-CAC Flowing Hair silver dollar is proof positive that true rare and important coins will continue to hold and raise in value.
The V Nickel coming to auction will be very interesting to watch.

I would like to add a very unusual bullion coin to the conversation. The American Silver Eagle, this bullion coin should not be in the same category as the above except I feel that for the general populous this series is being ignored and is slipping by some tremendous possibilities. Granted the market is very small right now as only the MS/PR 70's, toned ones and varieties that are becoming available such as the reverse proof.... Canada has used in recent years.But it cannot be denied they are making strides in market gains.  There has been a new book dedicated to this bullion coin and is the largest world wide collected bullion coin.

These coins as many tokens are and have been quietly collected and snapped
up by many dealers and they are very passionate about them.
I also think as far as entry collectors and bullion collectors this could be the next new wave that drives the value up. It does after all have a very popular and widely collected obverse design of the Walking Liberty Half dollar.

Thanks for starting a great and interesting thread and look forward to many responses.

[VDB Coins]

Doing more research on the Walton Liberty nickel it now appears that George Walton traded it from the Reynolds family, although exactly who is unclear (and the Reynolds family have never been able to find any records). Just wanted to clear that up.

Stefanie I was quite interested in your comments about the Russian coinage and would like a recommendation for a good reference work (I read a little Russian but obviously English is preferred) including price guidance. Also I could not agree more about the American Silver Eagles, they are not for everybody but those who are interested in them are keenly interested and passionate about them. The recent shortage of silver planchets at the Mint cannot help but spur that market as well. The recent publication of the John Mercanti work on the series will also boost that series. The silver market has been lollygagging around $30-$31/ounce for quite a few weeks now and I would not be surprised to see a temporary dip, but in the long term I think the prices will spike again, and this series being so closely related (but still loosely) to silver will benefit.

It occurs to me that next year is the 50th anniversary of the Kennedy half as well, a series I call the "Morgan dollars of the 21st century" although they are actually six years longer than the Morgan dollars already. (!) I wrote an article on my website about the series under "Collectors' Guides" that points up the many similarities between the two series. With the 50-year anniversary approaching, I think some of the 1964-after issues will, in the next few years, stop being perceived as "modern junk" or "modern" at all, but rather part of the classic series. In particular, I point out the 1964 SMS (NB, not 1965-67) coins which are among the rarest coins from the second half of the twentieth century. We have bought and sold quite a few individual pieces and complete sets, and have done much research in this area. When they started appearing in the Stack's auctions beginning in 1993, they were not in any official Mint packaging, just clear plastic capsules. The pieces are easily distinguished because they are business strike dies that were all polished roughly and haphazardly, then struck multiple times like a proof, so they show far more detail than any business strike but have a satiny, scarcely reflective (usually) surface unlike proofs (and to my eyes not resembling much the 1965-67 SMS coins, even though Stack's theorized they were experiments for that coinage). Anyway, not all of the sets contained the "real deal" halves (especially) and quarters, so authentication is required. I believe that all the coins are rare, but the halves more so than the other series. I think only 12-15 examples of the half survive. The dimes seem to be the most plentiful. The half in our Registry Set is MS67 PCGS (now they use to SP prefix), a coin we acquired about three years ago. Prices have more than doubled since I acquired my piece, and even then practically all of the sales are private transactions at prices that would astound most readers. The 1964 SMS coins are another area of the "modern" coin market that is going to become more and more interesting as time goes on. I would be extremely interested to hear from anyone who has now, has owned in the past, or knows of examples for sale or at auction. Since I am attempting to complete a roster of all five denominations I would particularly like to know the NGC/PCGS certification numbers and grades. Prices realized are nice but completely optional.

Looking forward to other market areas I think the Royal Canadian Mint's release of the 1912-1914 five and ten dollar gold pieces may temporarily depress that market but it will ultimately provide a stimulus (and a market opportunity for astute collectors).

Best Regards, 

George

[coinsarefun]

Looks like it may be a very interesting future for collecting coins.

George, I will try to post the information regarding the Russian coins soon.
This mostly comes from my personal experience over the last 6-7 yrs of auctions.

[jpcienkus]

This may be quite simplistic, but I think in addition to your analysis, there is a new buyer (like me) coming into the market in reaction to the global currency devaluation game.  As we print more paper money, I wanted to have some precious metals in my portfolio.  As I educated myself on ASE's, I found a previously undiscovered interest in coins.  I immediately was drawn to the Morgan.  While reviewing the Red Book, I was exposed to some other designs I thought were cool, but knew nothing about (WLH, Indian Heads, Peace dollars, Mercury dimes, Buffalo Nickels) and wanted to have some examples for my collection.

I still haven't warmed up to Barber designs.  I understand that numismatic value to these coins, but I don't find them very interesting.   Maybe over time I'll like the more and investigate.

This is a very abbreviated journey of how I became interested in coin collecting, but the spark was definitely ignited when I saw my first ASE proof.

[coinsarefun]

I am so happy to know that the ASE's have managed to bring someone into the wold of collecting.
I found them after I was collecting World coins and after Morgans.

Check out this thread here, have you seen the new book on ASE's.....really KOOL
http://www.coinsarefun.com/forums/index.php?topic=1198.0

[VDB Coins]

@jpcienkus One thing I have learned in, well, more than a half-century of collecting is, life is too short to collect coins you hate. If Barbers are not your thing, do not lose a second's sleep over it. There will always be plenty of coins you love. Unless I am buying an estate where you have to buy the "swillage," as a friend of mine terms it, along with the good, I never buy a coin unless it has eye appeal. I always think I will resell it some day, so if I don't like it, I don't think my customers will like it, and I don't buy it. (If the price is ridiculously low, that is another story, but it usually raises red flags for different reasons.)

So. Welcome to the forum, welcome to collecting, and welcome to buying coins you love! I too am glad that the ASE's have brought you into this fascinating hobby/vocation.

Best Regards, 

George

[cladking]

People don't notice the Russian Soviet era coins because they have so little demand and most are relatively common.  But the prices of these have simply exploded with increases of up to 200 fold.  $5 coins are becoming $1000 coins.  The early Soviet material is mostly up five or ten fold in higher grades like Xf and Unc but the later date (post-'60) material in nice Unc is proving to be highly elusive and simply not available even for the small demand and exploding prices. 

I used to correspond with members of the Moscow Coin Club so none of this is any surprise to me.  Coin collecting was discouraged in the Soviet Union but not strongly.  A coin club member could belong tothe Soviet Party but it was a strike against him.   None of these collectors had any interest in any Soviet era coins and few owned any at all.  The few they hjad tended to be in the nature of keepsakes and were the older coins and especially the silver.  Actual collection hardly existed.  They didn't have any access to moderns except the worn coins in circulation and couldn't help me acquire them even at very advantageous trade proposals!  My thinking was that if these coins weren't available there and were considered common here despite not being seen then they were great coins to set aside.  It's a shame they were so elusive.  Except for a mint set once in a while I doubt I found 50 other coins. 

The middle class  is exploding in size all over the world and many of these people have the money to collect coins.  They are demanding many coins that have never been in demand before and increasing demand on coins that have been scarce for many decades.  The world market looks to be something of a game changer.   

[jtabie]

Very interesting reads everyone.  I'm new to the forums but have been collecting for 30+ years and it is my love.  I too have seen an influx into numismatics as well as "bullion buyers".  I am not a dealer, strictly a buyer.  I've introduced a few friends to collecting over the years and I'm now finding it easier to introduce new collectors.  From where I sit, I honestly believe this is due, at least in part, to the bull precious metals market and those looking to get in on it.  I too find those who started with gold & silver eagles now working on type sets as well as other coin sets.  In my opinion, this influx will probably increase in the future as more and more "money" seeks haven from "dollars".  Maybe i'm mistaken, but once you are into collecting, it's hard to get out.  For this reason, I think we are adding a lot more than we are losing to the hobby, and with limited supply and increased demand, I think we all know where that leads...UP.  Anyways, as a collector, i'm not so worried about the "prices to sell" going up as I am worried about "cost to buy", but that is just a "small price to pay"(pardon the pun) to introduce others to this wonderful hobby.  I wish everyone a good day and happy collecting,

Todd

[coinsarefun]

Hi cladking.....nice to see you drop by.
To carry on the discussion of Russian coins 
check out the darkside forum link below.
http://www.coinsarefun.com/forums/index.php?topic=1218.0