By Laura Sperber – Legend Numismatics….
LOVE THE NEW LEVELS
We’re not going to fluff things. The market clearly is soft-in certain areas. Not good to have generics that haven’t been bought in the past two weeks, million dollar plus coins are almost frozen due to the looming Pogue sales (at least from our point of view), crazy GEM MS+PR68 Type like we love so much has been soft, and who cares about dreck?
All this sounds like gloom and doom but it is not. We were shocked to have had such strong sales last week. For us, regaining retail strength actually started at the Baltimore show. This past week we sold coins like the $1 1853 PCGS PR66 (a six figure coin) to coins such as an underrated 5C 1879 PCGS PR67. It was pretty much a regular week with coins disappearing off the web site within 24 hours of posting. We surprisingly had several collectors who cold called us as to what we had purchased out of Gardner. Our theory on that is simple: prices went cheap and they want in on the deals.
Save for only one maybe two people, everyone we have dealt with LOVES the new price levels (including us).
You can buy coins reasonable again.
The supply is not great-and no collectors seem to be dumping. At least your not being forced to pay $8,000.00 for a coin thats really worth $6,000.00.
You can thank dealers who over extended themselves and have a way to go to work out their cash flow problems.
Plus, the big auctions firms just had to flood the market with sales on top of sales in the past 30 days (dealers-including us-are serious coin addicts and will buy with little or no discipline). Dealers cannot buy much right now for lack of live cash and can not make bids. So there is no extortion of prices. Most (but never all) dealers are happy to raise cash thus they know they have to sell at todays levels. They are not being bulls and looking at tomorrow up tick pricing like they did only until this past summer.
Its clearly a BUYERS market today.
What we are greatly relieved to see-the buyers ARE there. They are right fully so being selective. We think when things just got too strong collectors started to step back. Now that things have settled, they are coming back. As much as coin people do not like it when we mention things like this: last week the art market had tremendous auctions with record prices. They still easily fetch millions per painting-even $100 million plus had a sale or two. And its not just art-CARS are still incredibly strong as are diamonds (yet another $20+ million dollar stone has sold). There clearly is still money out there for collectables.
The current situation with dealers will take a long while to work out. Most dealers are saddled with too much dreck while too little in fresh nice coins are coming to the market. We knew at some point the lack of great coins would take a toll. The one thing that has been firm through this entire soft patch-truly rare, fresh, and QUALITY pieces that have surfaced-have still brought strong to crazy money at auctions. We had multiple bidders on the $1 1881S PCGS MS68+ CAC that sold for $45,825.00 last month in our auction. We couldn’t get our paddle up on several of the 1853 coins in the recent Stacks sale.
Opportunities are all over the place. We just bought 5C Lib Nickels for an insanely low price of a several hundred dollars per coin-and even got non 1904’s. We shivered as we were buying them. The pops aren’t huge, the coins are of exceptional quality, and only a year ago they were selling for $1-$1,400.00. We do NOT see much down side. Its like a bio tech stock we follow. The stock dropped to an all time low of $18.00 in late Oct during the recent correction. We all sat there like the firms monkeys scratching our heads afraid to buy. Today the stock is at $32.00. During that swing, NOTHING about the firm had changed. It was just market psychology that spooked people for no reason. Markets generally overreact-the coin market is no different. On coins like these MS Lib Nickels, NOTHING much as changed for them. The pops have NOT radically increased. You can’t go all over and find NICE fresh pieces. The smart collector and buyer will see these coins clearly offering huge opportunity. NOTE: we are NOT saying coins could or should trade like stocks.
Coins are a LONG TERM buy and hold. BUT they will have short term swings.
WIDGETS VS POWER COINS
For the first time in years, Legend fully LOVES widgets!
NOTE: A widget is NOT a negative term. Its what Legend calls a “commoner” or semi generic coin.
To us, a widget is a nice (not wild) pleasing example of a common coin.
An expensive widget: A High Relief. A regular Widget: MS Barber Dimes in 65/66 or a 1882CC MS65/66 Dollar (just examples).
Widget prices have been sustained by dealers making sight-unseen bids. Now that the bids have disappeared, prices have softened. We LOVE the new price levels-when we can find nice widgets. At the new levels we are agressively buying up the nice widgets and you should be too. Like the bio tech stock we mentioned earlier, these more semi-commodity type “commoner” coins won’t stay at these price levels for too long! We hope next week to have a decent offering of them. We only bought them because we believe their current values.
Then there are semi-generic gold coins. Of course those are suffering BIG ouchies.
Again, dealers had to drop bids in this group for TWO reasons-#1 the price of gold fell. #2 their lack of liquidity wouldn’t allow them to make bids (many dealers were too busy trying to hit bids on gold last week).
If you notice, there are NO bigger and better gold coins like MS 65 $5 Indians or rare Liberty pieces coming to market. Besides being in strong hands, no one can really figure values of them today and if someone needed to sell, a dealer would be cautious cheap on any offer. However if any $5 Indians in MS65 do appear-and are at the new prices, you’d be crazy not to step up. We think MS64’s at around or below $2,000.00 also are a must buy. Our beloved MS66 Saints are now WHOLESALE BID at $3,500.00. We have only been hit with 5 coins. If you like generic or semi generic gold-now sure seems liek a great buying time! Unlike other major firms, Legend has kept our bids and we fully support the market on these.
In this field you need to know what you are doing.
Certain million dollar coins-have few if any buyers (we don’t think a 94S 10S would set any records today if put up for sale). Try and sell a great high grade MS or Barber Seated coin in GEM right now. Hard sell. Dealers won’t make ANY offers on coins like these. The biggest buyer is selling. This all makes NOW the time TO buy! Especially with Gardner selling. He was the 300 pound gorilla buyer in the auction and bourse rooms (don’t get us wrong, we all love and respect Gene-but he made it impossible to buy).
Collectors can now play the game again and build sets.
The same thing has happened in Buffalo Nickels-the collector who had to build multiple sets stopped buying over a year ago. And now several GEN sets are being built by different people. During his reign of having all the Buffs, few others could ever play.
If you have the ability to think a little contrarian, then you’ll know and clearly see what great opportunities currently exist.
Other power coins are still red hot. Good luck buying ANY choice silver or gold Bust coinage. Anyone looking at the Newman $50 1852 ASSAY SLUG NGC AU58+ being sold this week? Good luck!
We’re already knocked out on it-and we are crazy about coins like that.
Another not-so-power-coin, but one that has been slightly weaker-a gorgeous 25C 1899 PCGS PR67+ CAC just sold for a hefty $12,337.00. again, we couldn’t raise our hand. Why some coins go strong and others don’t- its all part of the highly selective market we are in. Collectors clearly want real quality for the money.
We see that the underbelly of the market actually seems fine from our point of view.
Keep in mind, we own several million dollars worth of coins for stock.
We feel the effects too. If we had not reduced some prices and blew out a few coins-we’d have had a great October. Our customer base definitely is alive and is aggressively buying (this is fact not hype). Our real problem-we still need the “right” coins… Where in the world is that 27S Saint in PCGS MS65 CAC?!!