By Vic Bozarth – Bozarth Numismatics
In this month’s Rare Coin Road Warrior I will briefly discuss the strong bullion market and how it will affect the rare coin market. In addition, I will try and give you some insight into what is happening on the ‘Bourse’ floor at the major rare coin shows across the United States. First let me make a correction in last month’s Rare Coin Road Warrior.
Last month I mistakenly listed the PAN/Monroeville, PA Show, held twice a year in a suburb of Pittsburgh, as being held in a suburb of Philadelphia. I apologize to John and Kathy Sarosi who did a great job hosting this show for years. The PAN Show is held twice a year. John and Kathy Sarosi are holding a new Spring show in Monroeville, PA March 24-27 called the C.A.M.P. Show in the same location as the PAN Show. Let me explain my mistake. For several years I did a Sunday only show in Montgomeryville, PA (a suburb of Philadelphia). Montgomeryville vs. Monroeville. I am pretty sure the show that was held in Montgomeryville has since moved to Fort Washington, PA and is put on each month by Allen Brock. All three of these shows are worth attending.
Now let’s get to the coin show news.
Gold is nearing an all time high price with the spot price at $1411 at this time. Silver continues to climb and has reached a thirty year high of over $33 an ounce. Are you surprised? I’m not. I am not a bullion or metals dealer, but the signs have been there for several years. Although the stock market has been performing well recently most other traditional investment mediums have been ‘in the dumper’. Real Estate and C.D.’s, two typically sound investment mediums, are terrible. If you want to have your nest egg eroded by inflation put it in a C.D. Real Estate looks good at these levels, but beware boys and girls because the foreclosures are still occurring in record numbers. The low interest rates we see advertised are mostly ‘smoke and mirrors’ because even those with excellent credit are being denied financing or refinancing.
Can you avoid the news? The Middle East and North Africa are boiling caldrons nearing explosion. Personally, I hope we see some new leadership in some of these countries. BUT, and here is the rub, can the U.S. avoid getting entangled in this mess. I think not. Unfortunately we are already involved. What does that mean for us? Gold prices are back up recently because of this unrest. The U.S. dollar, once the blue chip of world currencies, is worth no more than the paper it is printed on. Gold prices will continue to rise and fall, but I believe they will mostly rise.
I like gold. I don’t like it enough to put all my investment dollars in gold, but I have a substantial position both personally and in our rare coin inventory. I have continued to write about the disparity between the premiums classic U.S. Gold type coins once carried vs. the little to no premium they carry in this market. Recently huge hoards of classic U.S. gold coins have been liquidated in Europe. These supplies will be absorbed. First we saw the premiums evaporate for double eagles-U.S. twenty dollar face value gold coins minted before 1933. Lately the premiums for U.S. eagle ($10 face value) and half eagle ($5 face value) gold coins have evaporated also. With gold at $1411 the bullion value for $5, $10, and $20 classic U.S. gold coins are $341, 683, and $1365 respectively. Once these European hoards are absorbed in the market the premiums will rise again. The cream always rises to the top.
Don’t buy junk. Yes, it has gold value. Yes, the premiums are very small. Spend a little more money and buy MS63 and better classic U.S. gold type coins in denominations of $5, $10, and $20. I also like $1, $2.5, and especially $3 U.S. gold coins too, but the premiums on these lower denomination coins have remained pretty strong. Currently you can buy classic MS63 $20 gold coins in the Liberty or Saint Gaudens design for under $2000 and $1650 respectively. They melt for roughly $1365. Spend a little more for better date material and you will profit later. This is a NO BRAINER.
For several months now I have been recommending better date and type gold coins and now it is time for me to get off the ‘soapbox’. As the old saying goes, ‘you can lead a horse to water, but you can’t make it drink’.
The rare coin show schedule in February started with a really good Long Beach Coin Show. The bourse floor at the Long Beach Convention Center was nearly full. This is a huge room and several islands of new tables were occupied by lots of returning dealers as well as some new faces. Activity at the show was unusually strong also. Most dealers are complaining that ‘fresh’ material is just NOT coming into their stores or at the shows they are attending. What that means is that people (including dealers) are only selling those coins they either HAVE to sell or culling out their less desirable coins for current sale. Evidently not only dealers believe prices are going to go up. Indeed, the non-dealer public are holding their best coins because they believe prices are going to RISE.
Sales at Long Beach were strong and that trend continued through both the NGC Trade and Grade in Sarasota, FL and St. Louis coin shows week before last. Both NGC and PCGS hold several ‘Trade and Grade’ shows each year. For the last couple of years NGC has held these shows in Sarasota, FL while PCGS have their ‘Trade and Grade’ Shows in Las Vegas. We attended the NGC T&G and were pleasantly surprised with our overall sales. Although we didn’t attend the PCGS T&G reports from other dealers said sales were strong, but many dealers went home without their ‘walkthrough’ grading because PCGS got too many coins and had to take coins back to CA to grade them.
We also attended the Great American Coin Fair which most dealers know of as the St. Louis February Show. This show is held at the airport Hilton across from, you guessed it, the airport. The hotel itself has been renovated recently and is very nice, but the show itself is just TOO crowded. The bourse floor is WAY too small, the tables are very crowded, and walking the floor is difficult. Mike Orlando has done a great job running this show for years and the show itself always sells out to dealers, but the room is just too SMALL. Business at St. Louis was good. The lack of good ‘fresh’ material was very evident because dealers were falling all over themselves trying to buy and sell during the Thursday afternoon and evening set-up.
The upcoming show schedule includes two great shows in March, as well as several good smaller regional shows. The ANA Mid-Winter Show in Sacramento promises to be a great show, but the Baltimore Show at the end of the month will be excellent. The ANA continues to put shows in California although it is one of the most dealer UNFRIENDLY states in the country. The ‘nexus’ situation in CA basically wants to tax dealers who do more than twelve days of business at CA shows as CA businesses in addition to the taxes the company pays in their own state-kind of like double jeopardy. The ANA did schedule this show several years ago, BUT this is a real problem. I know of quite a few major dealers WHO WILL NOT ATTEND because the show is being held in CA. To their credit, the ANA is aware of this problem and they are trying to schedule future shows accordingly.
The Baltimore Show faces a similar problem. Recently the state of Maryland has plans for eliminating the bullion and coin sales tax exemption for transactions over $1000. As with many states, the shortsightedness of their respective legislatures knows no bounds. This is a real threat to the Baltimore Show and I would urge any and all concerned to write letters of protest. We have written letters ourselves and the Industry Council for Tangible Assets as well as the Professional Numismatists Guild both have ‘template’ letters and addresses for you to use to fight this legislation.
Baltimore has grown into the best commercial coin show in the United States. Yes, the F.U.N. Show is bigger, but the business in Baltimore is fantastic. There is a great Stacks/Bowers coin auction and the public attendance is huge. The problem with the sales tax issue is twofold. First, margins on bullion and rare coin transactions are often small percentage of two to five percent. Add the sales tax and the only people selling these items profitably will be the ones cheating the state out of the sales tax. Second, moving the show to another ‘more business friendly’ state would disrupt the show and indeed hurt public attendance severely.
In addition to the two larger shows in March there are several other noteworthy shows in different areas of the county. This week there is a show in Sarasota, FL. The Chicago Paper Money Expo is being held the 10th through the 13th the week prior to the ANA-Midwinter. If you are in the Minneapolis area there is a good smaller show in Brooklyn Center the 18th through the 20th. There are two good shows the week after the ANA Midwinter show in Sacramento which is being held the 17th through the 19th. Both the C.A.M.P. Show in Monroeville, PA (a suburb of Pittsburgh) and the Bay State Coin Show held at the Boston Radisson Hotel are scheduled for the 24 through the 27th. The C.A.M.P. Show is new, but the promoters, John and Kathy Sarosi, did a great job with the PAN Show held at the same location for years. Ed Aleo has been putting on the Bay State Show for most of four decades and there are always lots of neat coins and serious dealers in attendance.
The March Show schedule closes with the Whitman Baltimore coin show held the 31st through April 3. This is a must attend show for dealers. The April Show schedule includes shows in Chantilly, VA and Orlando, FL held the 8th through the 10th. The following week there are the shows in Chicago and Santa Clara, CA both being held the 14th through the 17th. There are no big shows scheduled for Easter week, but one of the best major shows of the year closes the month with the Central States Numismatic Society Show held in Chicago April 27th through the 30th at the Rosemont Convention Center.
The professional associations and friends I have made in the coin business are wonderful. There is a comraderie among fellow numismatists that transcends age and social background. If you have the opportunity, attend a show and join the fun. Listed below are the shows we will be attending in both March and April.
March Schedule:
ANA Midwinter March 17-19th
Bay State March 24-27th
Baltimore March 31st –April 3rd
April Schedule:
Santa Clara, CA April 14-17th
CSNS/Chicago April 27-30th
Bozarth Numismatics travels thousands of miles each year in search of high quality U.S. Coins. You can see our new purchase on either our website bozarthcoins.com or our Ebay store. Best Regards, Vic Bozarth.
