By Vic Bozarth – Bozarth Numismatics
Greetings Rare Coin Enthusiast!
The Winter Long Beach Show has come and gone. We were really pleased with the overall attendance and the number of new dealers taking tables at this year’s February Long Beach. In fact, more dealers took tables at the show than we have seen in several years. In addition, dealers were actively trying to buy coins for inventory. This shouldn’t surprise anyone. We are well into 2011 and the rare coin market is starting to heat up in several areas. Although many type gold issues continue to trade at the smallest premiums over their ‘melt’ value we have witnessed in the last several decades, quite a few coins (that have been relatively flat for a couple of years) are quite active and highly sought after. Although many dealers commented on the lack of ‘fresh’ material we were able to buy a lot of nice coins. Many of these new purchases are listed on our website, bozarthcoins.com.
What is new in the rare coin business? There is a new rare coin trading network called Coinplex to compete with Collector’s Universe Certified Coin Exchange. The new America the Beautiful coins are starting to appear with more frequency. PCGS celebrated their 25th anniversary. Two of the oldest names in the rare coins business have merged. The new Stacks/Bowers Auction Company is gearing up for their first sale at the Whitman Baltimore Coin Show in late March. I also want to correct a mistake I made in my last Rare Coin Road Warrior. Lastly, I will list a couple of areas of the rare coin market that are ‘heating’ up.
There is a new trading market on the scene. Coinplex has 135 members already and continues to grow. Although there are hundreds of coins without bids, Collector’s Universe Certified Coin Exchange has never had ‘reasonable’ bids on ALL U.S. coins. In fact, two of the big reasons behind the new trading network are the proliferation of ‘lowball’ bids and higher sight-seen ‘fishing’ bids. Dealers are either placing ‘lowball’ bids trying to ‘rip’ product for too little or higher sight-seen bids hoping to ‘cherry pick’ the occasional breakout/upgrade while rejecting 90% of the graded coins sent at their bids. Both of these services have great features. As with the valuation guides for all coins, you have to be able to read between the lines.
PCGS was founded in 1986. Because of disagreements in ‘philosophy’ NGC sprouted up not long afterwards. To a certain extent there has been an East Coast/West Coast rivalry going on between the two for years. PCGS, located in Newport Beach, CA is obviously the choice of many in the West while NGC, whose headquarters was originally in NJ and has since moved to Florida, is the East Coast service. PCGS was first and has set some of the standards for the industry, but NGC has thrived because of some PCGS mistakes and a little arrogance with PCGS itself. Frankly, there were some pretty big egos and personalities involved also.
Grading is NOT an exact science. Grading is very subjective. A pretty coin with no ‘technical’ problems will usually grade at both services, but recently both PCGS and NGC have been grading more conservatively to bolster their overall product confidence. What we all need to remember is that both PCGS and NGC are BUSINESSES created to make money. The fundamental reasoning for creating PCGS and NGC was and is solid. The coin industry needed stricter standards. Over the last three decades I have seen numerous collections and portfolios of raw/ungraded supposed ‘investment’ grade coins that have technical problems (i.e. cleaning, wiping, artificial toning, putty, repairs, etc.) that remove them from the ‘gradeable’ category at either PCGS or NGC. In addition to the technical problems, many of these supposed investment grade coins were just OVERGRADED.
For the most part both PCGS and NGC have done an amazing job of standardizing grading. Because grading is not an exact science the ‘concensus’ grading method has ‘worked’ more often than not. Technical problems resulted in ‘no grades’ at both services. THERE IS NO QUESTION that the coin business has benefited from both PCGS and NGC because of stricter standards and improved marketability of both PCGS and NGC graded coins themselves.
The new America the Beautiful coins are being seen more frequently. Personally we ordered two sets and have been quite impressed. They are big and beautiful. I don’t recommend modern coinage for rare coin investment. UNLESS you are buying modern U.S. mint products for a small premium over MELT for bullion investment purposes, I believe they are nothing more than CREATED rarities. The U.S. mint will produce what it can sell and changes their ordering and production rules so frequently many dealers refuse to deal with them. The U.S. mint is, after all, a bureaucratic entity and follows no rules other than those they change often. The America the Beautiful five ounce coins are neat, but the Chinese have been producing products like this for years.
Two of the oldest and most respectable names in the rare coin auction business have merged recently. Both Stack’s and Bowers and Merena rare coin auction houses have been around for decades. They have handled virtually all U.S. rare coins and I have followed their auctions since the mid-seventies as a teenager. The auction business is very competitive. Personally, I think this is a smart move for both firms. I have long been an avid admirer of Q. David Bowers. He is the most prolific and knowledgeable rare coin author in the business. I am looking forward to attending their first auction in Baltimore in late March. The new president of the combined company is Chris Napolitano. Chris is not only a consummate numismatist, but also a smart business man with many years of experience in the coin business.
As many of you know, I also write a monthly column called ‘Rare Coin Road Warrior’. In last month’s article, I mistakenly wrote about the Monroeville Coin Show which is in a suburb of Pittsburgh. I mistakenly listed the show as being held in a suburb of Philadelphia. MY BAD. For several years I attended a Sunday Show in Montgomeryville, PA (Monroeville vs. Montgomeryville) which is a suburb of Philadelphia. Both shows are great, but I have been told that the Montgomeryville Show moved to Ft. Washington. In any case, I want to apologize for the error. Both shows are great.
What’s ‘HOT’ in rare coins right now. Morgan and Peace Dollars are moving. Common date (generic) coins have jumped over 20% in the last six months, but better dates haven’t really moved YET. If you can ‘read’ between the lines, better dates are a good deal right now and will more than likely follow the generics. Selected high quality classic Commemorative half dollars are starting to heat up. Commemoratives have been in the ‘crapper’ for several years and many dealers and collectors have taken notice by quietly buying high grade, MS64 and better, issues. CAC coins are selling very well, but darkly toned ugly coins ARE NOT. Indian Gold coins are hot also. With the publication of the new Mike Fuljenz book there has been increased interest in all of the three Indian Gold issues. Considering the bullion price of gold, there are still a lot of good buys in all three of these series. In previous RCMR on ‘Building Meaningful Sets of U.S. Coins’ I recommended Peace Dollars, Commemorative Halves, and $2.5 Indian Gold Coins. They are moving, but it isn’t too late!
Bozarth Numismatics Inc. is a full service rare coin company. We are SHOW dealers and do not have a ‘shop’ because of our extensive show travel. We travel over 200 days a year because it allows us to buy ‘fresh’, rare, and meaningful new coins virtually every week. To see what we have to offer you can visit our website Bozarthcoins.com or visit our Ebay store. We also offer no obligation ‘want list’ services for those hard to find items. Thanks and Best Regards, Vic and Sherri Bozarth.