News and Analysis regarding scarce coins, coin markets, and the coin collecting community #313
A Weekly CoinWeek Column by Greg Reynolds …….
On Thursday, January 7, 2016, at the FUN Convention in Tampa, Heritage conducted a U.S. coin Platinum Night event as one part of an auction extravaganza. In the realm of U.S. rarities, the FUN Platinum Night event has been a tradition since 2004 and is closely followed by insiders in the coin business. Of course, it is not practical to review all aspects of this Platinum Night event in this discussion. The focus here is on selected 19th century U.S. gold coins in the context of a discussion of changes in market levels over the past few months.
Since August 2015, market levels for classic U.S. coins, 1793 to 1934, have been moving slightly downward. Market levels for rare silver coins has fallen more than values for rare U.S. gold coins.
During 2015, early gold coins held their value better than not-so-early U.S. gold coins in 2015. Indeed, some pre-1840 gold coins rose in value last year.
Conditionally rare Indian Head quarter eagles and Indian Head half eagles have declined in value to a much larger extent than rare gold coins, though most of the decline in values for Indian Head quarter eagles occurred a few years ago. Most rare date Saint Gaudens double eagles ($20 gold coins) are ensconced in private collections. These have been trading so infrequently over the last three years that it is hard to perceive a trend.
While levels for rare U.S. gold coins overall were generally stable from 2010 to early 2015, prices in some categories of coins faltered and others rose during those five years. Market levels for rare gold coins rebounded well after the 2008-09 downturn. Levels held, more or less, around a trend line from early 2010 to August 2015.
Results in the Platinum Night of January 7 provide circumstantial evidence that demand for 19th-century rare gold has not fallen dramatically and remains healthy. Conclusions about rare coin markets overall should not be drawn from the results of any one auction or from prices realized in any one area.
I have been analyzing rare coins and related auctions for more than twenty years and I obtain information from a range of sources. There is no simple formula for gauging market levels.
In other areas, such as gem quality copper, copper-nickel and nickel coins, market levels are far from highs reached during the period from the middle of 2006 to the middle of 2008. Values of pre-1856 Proof silver coins are fractions of levels that were reached in the middle of 2008 and have been trending downward for the last three years. Prices for gem quality, early 20th century (pre-1934) U.S. coins of most series never returned to mid-2008 peaks and have fallen further since August 2015. A few such coins have been declining in value since the middle of 2013 or 2014.
Should collectors be concerned about the values of their respective collections? Perhaps some adjustments are normal, healthy, and logical? Prices skyrocketed from 2003 to the middle of 2008. Prices soared too fast to settle at sustainable levels. When coin markets boom, they tend to do so rapidly with much energy, as happened in the early 1960s, the late ’70s, and the late ’80s.
It is amazing that markets for rare U.S. coins recovered so well after bottoming in April 2009. By 2010, many market values were at levels reached during the peak period from 2006 to the middle of 2008, an astonishing rebound.
Recent adjustments, including the mild slide since August, are normal and reflective of a combination of macro-economic, which are national or global, and micro-economic factors. The micro factors relate to speculative activity and problems in the coin business, which I believe can be largely resolved. All business environments have problems of one sort or another.
The health of markets for rare or scarce 19th-century gold coins, and the notable success of this FUN Platinum Night, may be illustrated with some examples. Although many excellent coins were included and the auction was successful, this was not one of the more glittering and energized Platinum Night events.
One of the all-time best sets of Barber halves, the Shireman set, was overshadowed by the recent offerings of “Greensboro” and Gene Gardner Barber halves. In another era, the Shireman set would have captivated the attention of collectors.
World-War-II-era Lincoln cent errors are important and very popular. Aggressive reserves dampened the aura of the offering of these in this auction, along with the reality that Bob Simpson did not include two of the best pieces in his consignment of Lincoln cent errors, Simpson’s famous 1943-S in copper and the unique 1943-D in copper. The Lincoln cent errors included in Simpson’s consignment were overshadowed by the two that were omitted.
The McCoy set of early quarter eagles and the “Pacific Heights Collection” are extremely important. Even so, the McCoy set was overshadowed by the Pogue coins of the same series that were auctioned in 2015.
The “Pacific Heights Collection,” which was impressive and very fresh, suffered from being too vague. A story about the organization and building of the “Pacific Heights Collection” would have contributed to interest in the coins and in this sale.
There was less fresh material than is usually found in a Platinum Night event. A coin must not have been publicly offered in the mainstream of the coin business for at least five years to be ‘fresh.’
There were many re-appearances of items that were in recent Partrick, Newman and Gardner sales, and of gold rarities that were in the Heritage CSNS sale in April 2015. (Please click on words in blue to access pertinent articles.) Also, the percentage of coins with CAC approval in this Platinum Night was not high.
Given that the auction and the FUN Convention were not as exciting as usual, it is a promising sign that prices were as high in the Platinum Night event as they turned out to be. Some rumors of sharp declines in market levels are not true. There was not evidence in this auction that prices for rare gold coins have fallen much overall since August.
1856-O Double Eagle ($20 gold coin)
The 1856-O double eagle in this sale may have been fresh. It has been auctioned within the last ten years. This 1856-O is PCGS graded as EF-45. The $235,000 result last week might seem weak to someone who is unfamiliar with the coin.
This same 1856-O was formerly judged to be non-gradable by experts at NGC and placed in a “NCS” holder with the notion that it had been ‘improperly cleaned.’ While in an NCS holder, it was auctioned by Heritage in April 2006 for $161,000 (www.ha.com/402*2137). In January 2014, a better 1856-O, one from the Douglas Martin Collection that is NGC graded as EF-45, brought $381,875.
In 2006, the just sold 1856-O was said to have the “details” of an extremely fine grade coin. In addition to having been subject to an extensive cleaning, this coin has a large number of notable scratches and contact marks. It is true, however, that Liberty Head double eagles from the 1850s, especially New Orleans Mint issues, tend to be full of hairlines and significantly deep contact marks.
Regarding these, it is particularly difficult to define a border between the gradable and the ungradable. Nevertheless, a lesson to be learned is that all coins of the same issue that have received the same numerical grade from PCGS are not equal. Some might be worth much more than others. Also, a coin that is judged to be non-gradable one year may be found to be “gradable” at a later time. It is really important to think beyond the certifications and focus on the physical characteristics of the respective coins. The $235,000 result for this coin, on Jan. 7, 2016, is not evidence that market levels for 1856-O double eagles have fallen, though they probably have fallen a little in 2015.
Quarter Eagles (U.S. $2½ gold coins)
The 1804 thirteen stars reverse quarter eagle could be termed a Great Rarity, although the 1804 fourteen stars reverse is not nearly as rare and is of the same year. There is no doubt that much fewer than twenty-five 1804 thirteen stars reverse pieces survive.
Prices realized since 2008 for these are circumstantial evidence that those who collect bust quarter eagles ‘by date’ regard the 1804 thirteen stars and fourteen stars varieties as two distinct dates. The thirteen stars pieces tend to bring dramatically more than the 1804 fourteen stars reverse quarter eagles and vast amounts in absolute terms, amounts much larger than rare die pairings of quarter eagles would be likely to garner from specialists in die varieties.
The Carter-McCoy 1804 in this auction is PCGS graded as AU-55 and CAC approved. The $505,250 result, an auction record for an 1804 quarter eagle, is strong.
On May 19, the $499,375 result for the PCGS graded AU-53, Earle-Price-Pogue coin was widely held to be a surprising very strong to extremely strong price. That same coin was formerly in a NGC holder, with an “AU-55” grade assignment. It had realized $322,000 on July 31, 2008, in the sale of the Ed Price Collection, which was characterized by strong to very strong prices overall. Besides, markets for rare U.S. coins probably reached an all-time peak on July 31, 2008, when Ed Price’s sets of dimes and quarter eagles were sold in a Platinum Night event at an ANA Convention.
In the same Pogue I sale, on May 19, 2015, there were Ed Price Collection bust dimes that were earlier in the just cited sale on July 31, 2008 and brought lower prices on May 19, 2015. It is fascinating that the Earle-Price-Pogue 1804 quarter eagle brought so much more in May 2015 than it did on July 31, 2008.
Now, the Carter-McCoy piece has brought even more than the Earle-Price-Pogue 1804. Presumably, the buyer in May was not bidding in January. The $499,375 result on May 19, 2015 and the $505,250 result on Jan. 7, 2016, are watershed results in the area of rare 19th century gold coins.
The 1802/1 quarter eagle is not nearly as rare as an 1804 with thirteen stars on the reverse. Even so, it is a very rare date, and an extreme condition rarity in choice to gem grades.
The Pogue-Licht 1802/1 is PCGS graded MS-64 and CAC approved. It brought $211,500 in May, a strong price.
The McCoy 1802/1, which is PCGS graded as MS-64+ and CAC approved, sold for $199,750 on Jan. 7, 2016. Though not noted in the Heritage catalogue, the McCoy piece is barely fresh, as it was auctioned by Heritage in January 2011. It was then NGC graded as MS-65 and did not have a CAC sticker. It brought $172,500 in January 2011, when markets for most rare U.S. coins were at higher levels than they are now.
A PCGS graded AU-53 1807 quarter eagle is not quite as expensive as the just mentioned early quarter eagles. It has a CAC sticker. There is no mention in the catalogue of a pedigree, though piece may be identified by an indentation near Miss Liberty’s nose.
While the $18,800 auction result is not any kind of a record, it is not weak and is not evidence of a decline in market value for such a coin. A certified “AU-53” 1807 has not brought more since 2006 and a certified “AU-55” 1807 quarter eagle has not realized more at auction since 2010! In November 2011, a different PCGS graded AU-53 1807 sold for $13,800, though that coin was probably inferior to this one.
When I select coins as examples for price-references in auction reviews, I often attempt to select coins that most pertinent experts would regard as fairly graded within reason, at least not way overgraded or mistakenly graded. Prospective buyers, however, are advised to consult experts about specific coins and to not rely entirely upon certified grades, catalogue descriptions, or remarks here.
Although 1825 quarter eagles are very rare, they are among the least rare of the whole Capped Head quarter eagle design type, which dates from 1821 to 1834. Further, the 1825 is the least rare date of the subtype that was minted from 1821 to 1827. So, in some sense, a high grade 1825 is a type coin, as many people who are assembling type sets would demand it. Far more people are collecting quarter eagles or early gold coins overall ‘by type’ than are collecting Capped Head quarter eagles ‘by date,’ which would be a difficult endeavor.
“The McCoy Family Collection” contained a PCGS graded MS-65 1825, which is CAC approved. It sold for $94,000. Though no pedigree is stated in the current FUN catalogue, I believe that this is the Donald Bently coin that Heritage auctioned on March 20, 2014, for $105,750. My understanding is that the Bently Collection coins sold then were not sent to CAC prior to March 20, 2014. This 1825 was thus ‘off the market’ for less than 24 months, hardly fresh.
The $105,750 result then and the $94,000 realization now are both moderate. Demand for these has fallen a little over the last two years. The PCGS price guide value of $115,000 and the “Numismedia Retail” value of $112,450 would both be fair retail prices. The $125,000 value that has been published in a coin oriented newspaper is too high.
The results in this auction suggest that Gem Proof Liberty Head quarter eagles may have recently fallen significantly in value. While any one coin might bring a below-market price for any of several reasons, it is unlikely that a few Proof Liberty Head quarter eagles would bring below-market prices in a FUN Platinum Night event. There is an active market in these, mostly as type coins, among dealers, collectors, speculators, and telemarketing firms.
For example, an 1896 that is PCGS certified as “Proof-66 Deep Cameo’ and CAC approved brought just $23,500. In July 2013, Legend auctioned one with the same PCGS and CAC certifications for $32,200. Over the last few years, or even in early 2015, this 1896 quarter eagle would probably have easily wholesaled for more than $25,000 at a major coin show.
An NGC graded MS-62, and CAC approved, 1802/1 half eagle sold for $18,800. This result seems consistent with pertinent auction results over the last five years. It is not evidence that demand for such a coin has fallen at all.
An 1813 Capped Head half eagle is an excellent example of a type coin. By a wide margin, it is one of the least rare dates in the rarest series of U.S. gold coins, Capped Head half eagles. There are more Great Rarities in this series than in any other. Someone assembling a type set that requires a Capped Head half eagle would be likely to choose an 1813, an 1818 or an 1820.
In this auction, there was a PCGS graded MS-64, and CAC approved, 1813. It brought $70,500. The upper reach of a retail price range would be $55,000, maybe.
As I have not seen the coin, I will not draw a conclusion about the price, other than to suggest that at least two bidders may have figured that there is a good chance that it will be upgraded to MS-65 at PCGS or NGC. There could also be another explanation. For a “MS-64” grade 1813, an amount of $70,500 is an extremely strong price.
The case of the Milas 1852 half eagle is interesting. It was once in the epic set of legendary dealer Ed Milas, which Stack’s (NY) auctioned in 1995. “Extremely impressive, beautiful, true 66 grade coin, one of the best ‘No Motto’ fives I have ever seen,” Richard Burdick exclaims.
As I reported last year, this Milas 1852 was in a group that was purchased from a Louisiana firm during the late 1990s and consigned to the Heritage auction at the CSNS Convention in April 2015. It was then NGC graded MS-66 and CAC approved. It has since been PCGS graded as “MS-66+.”
I note that experts at CAC ignore the plus aspects of plus grades assigned at PCGS or NGC. Therefore, it is not revealed as to whether experts at CAC place the grade of this coin in the middle or high end of the 66 range.
The Milas 1852 sold for $76,375 in April and $79,312.50 in January. In April, it was understood that this coin had been graded as MS-66 by NGC a long time ago. There is no evidence that demand for this coin fell during 2015.
As each coin is different, and certifications of the same coins change, it is impossible to precisely measure market levels and directions regarding rare or very scarce U.S. coins. The prices realized for 19th century gold coins in the recent Platinum Night event do not provide evidence of a steep decline over the last four to five months, which has been reported by some dealers.
The decline since August may have been mild or slight. It is too soon to tell. An understanding of prices realized in this Platinum Night event indicates that demand for gold rarities is very healthy.
©2016 Greg Reynolds