News and Analysis regarding scarce coins, coin markets, and the coin collecting community #260
A Special Report by Greg Reynolds for CoinWeek ……..
There are widely circulating rumors, some voiced by insiders who I know, that prices for rare U.S. coins and patterns markedly fell during the second half of 2014 and are further falling. The ‘good news’ is that an analysis of the HA FUN Platinum Night event on Jan. 7 and of the Partrick session on Jan. 8 in Orlando indicates that these rumors are not true. In some cases, the supply of coins available, in particular categories, increased. Demand for most, rare U.S. coins in Jan. 2015 is about the same as demand was in Jan. 2014, and not much different from demand in Jan. 2013.
Yes, market levels for a few rare or very scarce U.S. coins fell by 5% to 15% from September to November. Such declines, though, were largely due to an increase in supply of such coins being available and/or adjustments for increases in supply that are expected to occur in the near future.
A theme is that most of the negative perceptions and conclusions regarding collector demand and market prices, which I have been frequently hearing, are not true. First, I put forth remarks about pre-1793 items, including million dollar items that ‘made news’! I explain that demand for pre-1793 items has not fallen, despite some low prices for American colonials in the FUN auction.
The core of this discussion is the use of logic and examples from the FUN Platinum Night event to counter arguments that prices have fallen; market levels now for business strike rare U.S. silver coins, condition rarities, and key dates in all metals of classic U.S. coin series, may very well be, on average, about the same as such levels were in Jan. 2014 and Jan. 2013
Pre-1793 items are a Different Matter
Pre-1793 items are different from U.S. coins, and an unusual set of circumstances now pertains to these. Yes, the FUN auction results clearly demonstrate that market levels for a few categories of pre-1793 American items have decreased substantially.
There are more enthusiastic collectors in the 21st century than ever before for 18th century American coins and related pieces. The cause of the fall in prices for some of these items is certainly not a decrease in demand; the cause is a sharp increase in supply.
Prices are determined by a combination of supply and demand. Even if demand remains the same, an increase in supply will usually result in lower market prices.
The sales or pending sales of three gigantic collections of pre-1793 American items have become part of the supply equation. Eric Newman is the most famous of all collectors of pre-1793 items and almost all of his collection was built before 1965. For a long time, it was widely rumored that Newman’s collection would never be sold and would remain in or associated with the Newman Money Museum.
Starting in 2013, Newman’s collection has been auctioned in parts and, as it turns out, is much more vast than most experts had believed it to be. In May 2014 and again in November, a large quantity of Newman’s pre-1793 rarities, an almost unbelievable assortment, was auctioned.
It seems that Donald Partrick acquired hundreds of noteworthy, pre-1793 coins and patterns and formed a collection that rivals that of Newman! On Jan. 8, Heritage auctioned the first part of the Partrick Collection. According to noted collector Alan Weinberg, Partrick has been spending substantial sums on noteworthy pre-1793 items since the early 1960s. I witnessed Partrick seriously bid at auctions in the 1990s and 2000s. His collection, too, has turned out to be larger and greater in depth than most collectors and dealers had thought. I, for one, was surprised by multiple, relatively high grade Higley Coppers in this collection and the extant of his collecting of die varieties in other series of American colonial coins.
It had been rumored that Partrick collected colonials ‘by type,’ not by die variety. While it was common knowledge that Partrick collected 1792 patterns, he acquired more varieties than most pattern experts dreamed that he even might own.
In many areas, the Kendall Collection is in the same league as that of Newman and Partrick. In March, Stack’s-Bowers will auction the Kendall Collection.
The accumulation of Massachusetts silver coins of Newman, Partrick and Kendall combined are incredible and constitute a massive increase in the supply of such coins for active collectors to acquire. This is also true of ‘Sommer Islands’ (1615-16) Bermuda coins and some other pre-1793 series.
While demand for Massachusetts silver has increased over the last fifteen years, the supply has recently increased to a tremendous extant. In the past, during any given eighteen month period, there might have been, on average, two or three (1652) NE shillings available. From Jan. 2013 to June 2014, at least fifteen will have been offered at auction. Probably only around forty are privately owned and some of those are non-gradable. Most of the fifteen that have recently been offered, or will soon be, are of relatively high quality. So, it is unsurprising that market prices for NE shillings have dropped, although demand for these has not fallen and may have risen.
$2 Million Copper Pieces
Although I have a great affinity for pre-1793 items, most collectors in the U.S. are far more interested in regular U.S. coins. An auction record for a copper coin was set when a 1793 Chain Cent sold for $2.35 million. Chain cents are the first U.S. coins, and were replaced by Wreath cents after a few months.
There are three major varieties of Chain Cents. On the first (S-1), America is abbreviated, “AMERI.” On the second, the word ‘AMERICA’ is entirely present. The three die pairings of this second major variety (S-2, NC-1 and S-3) are of interest to specialists in die pairings, not to most collectors. On the third major variety (S-4), there is a period after the word ‘LIBERTY’ and a period after the numerals of the ‘date,’ 1793. Collectors of type coins often prefer this third major variety (S-4) because Miss Liberty has greater detail and the mint workmanship tends to be better.
The 1793 Chain cent that just sold for $2.35 million is of the third variety (S-4), with periods. “This is the second finest S-4 that I have ever seen, and one of the top five Chain cents of all varieties,” exclaims Richard Burdick, a connoisseur of gem quality, early copper coins. Richard has been carefully examining gem large cents since 1969 and he assembled one of the all-time greatest collections of Proof large cents, which he sold privately to Ted Naftzger in 1986. Also, Naftzger used to own this specific S-4 Chain cent.
In 1992, Eric Streiner purchased most of Naftzger’s collection of large cents. Stack’s in New York brokered that transaction. Streiner sold many of the best business strikes, including this coin, to Jay Parrino, who showed this coin to me. It was PCGS graded MS-65 early in 1992. Later in the year, Jay was asking $250,000 for it.
In 2014, it was placed in a PCGS ‘secure’ holder with a MS-66 grade and then CAC approved. By current standards, the 66 grade is non-controversial. It has minimal abrasions and lacks the noticeable corrosion that tends to characterize early copper coins. Indeed, the Eliasberg, PCGS graded MS-65, S-4 Chain Cent that realized $1.38 million in the Jan. 2012 FUN auction has noticeable corrosion on the reverse (back of the coin).
The $1.38 million price that the Eliasberg S-4 Chain realized in Jan. 2012 was considered very strong at the time. A $1.85 million result for this Parmelee-Naftzger-Parrino Chain would have been moderate. The $2.35 million realization is certainly strong.
This is the third or fourth best Chain cent that I have ever seen. The Mickley-Crosby-Naftzger S-4, which is graded 67, is the best; the PCGS certified SP-65, Naftzger-Morelan S-1 is the second. I would have to view the Garrett S-3 again to form a firm condition ranking, or at least find my notes from more than twenty years ago.
This $2.35 million auction record for a copper item was broken a day later when the Garrett-Partrick 1792 Birch Cent pattern brought $2,585,000. Richard Burdick finds this purchase to be “an excellent value.” John Albanese, too, says that it “was a good deal.”
The Garrett 1804 dollar, which is much more famous, was auctioned for less than $2 million in August. An 1894-S dime has never sold for as much as $2.2 million. (Clickable links are in blue.)
This Garrett-Partrick pattern is NGC certified ‘MS-65 RB’ and is CAC approved. Unquestionably, it is the finest known Birch Cent pattern. It is an item, though, that few people understand or recollect reading about. Also, the identity of “Birch” and the circumstances surrounding the production of these are not clear now.
When I was kid, I dreamed of 1804 dollars, 1894-S dimes, 1913 Liberty Nickels, Ultra High Relief Saints, and maybe 1876-CC Twenty Cent pieces, not Birch cents. It is newsworthy that a mysterious pattern brought a price in the same range as the values of several of the most famous Great Rarities. One could argue that all 1792 patterns are of tremendous historical significance.
An even less widely known pattern brought nearly as much in the same auction session. Partrick’s 1792 quarter pattern in copper sold for $2,232,500! Reportedly, Kevin Lipton was the successful bidder for both these $2+ million patterns in copper.
Other than 1907 Ultra High Relief Saints and a special 1907 Eagle, a ‘pattern’ had never before Jan. 2015 realized more than $2 million at auction, to the best of my recollection at the moment. Coincidentally, in the Jan 7th Platinum Night event, an Ultra High Relief Saint, with Saint Gaudens’ initials etched onto the edge, sold for $2.115 million. Only one other Ultra High Relief Saint has sold for more at auction.
In regards to the Partrick patterns, there was no evidence of ‘softness’ in the marketplace. In my view, there is no reason to believe that demand for early patterns is lower now than demand was in 2013 or 2014.
Although demand for them is strong, prices for 1792 silver center copper cent patterns have dropped because so many of these have entered coin markets since Jan. 2012. There is one in the Kendall Collection as well. Partrick’s NGC graded and CAC approved, ‘EF-45+’ piece sold for $470,000, less than it would have realized if it had been auctioned in 2010 or 2011.
It is also true that Partrick’s, NGC certified ‘MS-64 RB,’ 1792 disme in copper (a dime pattern), with a plain edge, sold for the astonishing amount of $1,057,500, a very strong price! Although this is one of three known with a plain edge, Saul Teichman estimates that there “about twenty are known in copper with reeded edge,” and thus not one of the rarer 1792 patterns.
A million dollars for an edge variant of a relatively common pattern is not evidence of falling prices. I doubt that this piece would have brought as much as $1 million, if it had been auctioned in 2010 or 2011. There is more interest in early patterns now.
Key 1877 and 1909-S VDB Cents
The 1877 is the key to the series of Indian cents. One that is NGC certified as ‘MS-66 Red & Brown’ is, in some sense, a condition rarity, perhaps. There are more than 50,000 people collecting Indian Cents, yet NGC has certified just seven at this level and PCGS just four. Neither service has certified an 1877 cent as ‘MS-67 RB.’ Those that are certified as ‘full red’ (“RD”) usually appeal to different buyers.
I recommend ‘red and brown’ uncirculated Indian cents over the so called ‘full red’ coins for more than one reason. Naturally full red pieces tend to fade, sometimes rapidly, and become partly brown. Moreover, coin doctors tend to turn brown cents to artificially ‘full red’ cents, as such an endeavor is easier for them than generating a deceptive red-brown mix and because designated ‘full red’ cents tend to be worth more than ‘red and brown’ designated cents of the same certified, numerical grade.
In any event, this 1877, which I have not seen, realized $32,900. Although one auction result does not prove a point, this result is certainly not evidence that prices for 1877 cents have dropped in 2014. The PCGS price guide value is $35,000 and the numismedia retail value is $22,430. In 2010, Heritage auctioned two 1877 Indian cents with the same ‘MS-66 RB’ certification by NGC, one for $12,650 and the other for $17,250.
As the 1877 is the key to the Indian cent series, the 1909-S VDB is the main key to the Lincoln cent series and is even more famous. In this auction, a PCGS certified, and CAC approved, ‘MS-66-Red’ 1909-S VDB brought $15,862.50, a moderate to strong price. Again, while the auction result for one 1909-S VDB cannot prove a point about a large number of 1909-S VDB cents, I have not found evidence that prices for really appealing, 1909-S VDB cents are any lower now than such prices were during much of 2014.
Business strike 1883 Three Cent nickels are rarities and one that is graded MS-67 is certainly a condition rarity. The one in this Platinum Night event is PCGS graded MS-67 and CAC approved. It brought $25,850, which is exactly the same amount that PCGS graded MS-67 1883 three cent nickels brought in Heritage sales on April 28, 2013, Aug. 10, 2014 and Oct. 27, 2014. Is there any evidence that these have fallen in value in 2014?
A PCGS graded MS-66 1880 Shield nickel, without a CAC sticker, sold for $117,500. I have seen this coin and I am sure that it has failed to sell in more than one recent event. The $117,500 result is very strong. It could not be fairly argued that a market level for this coin was higher in 2013 or 2014.
The 1885 is a key in the series of Liberty Head nickels. A PCGS graded and CAC approved MS-66 1885 sold for $14,100 in this Platinum Night event, which is the exact same price that Heritage auctioned one for on Oct. 27, 2014. Is there evidence that prices for these have been falling since October, as some ‘insiders’ suggest?
Several of the other Liberty nickels in the “Ally Collection” did not seem to fare as well. When coins seem to bring ‘weak prices’ at auction, the respective prices might not be weak at all; they could relate to the physical characteristics of the coins in question. It sometimes true that the respective coins are overgraded in the views of some relevant experts and/or have other issues. As I did not view this “Ally Collection,” I am not commenting upon it here.
1795 Half Dime: Very Scarce
A PCGS graded MS-64 1795 half dime is a condition rarity in the sense that fewer than seventy-five grade 64 or higher and the coin is scarce in all grades. The one in this Platinum Night brought $21,150.
If this 1795 half dime is fairly graded in the views of most relevant experts, then this is a fair, moderate price, in terms of market levels over the last five years. If its grade is very much debatable, then this is a strong price. Either way, this result is another bit of information that counters the rumors that prices for classic U.S. coins are lower now than they were in Jan. 2014 or in Jan. 2013.
Key 1804 dime: Famous Rarity
The 1804 is the key to the series of Draped Bust, Heraldic Eagle dimes. In terms of rarity, there is not much difference between the major varieties. This one is PCGS graded VF-35 and sold for $22,325. This exact same coin, however, was auctioned by Heritage on June 5, 2014, for $19,975. The current result is certainly not evidence that the market value for this coin fell during the second half of 2014.
Supergrade 1861-S Dime: Absolute Rarity
In this FUN Platinum Night event, a PCGS graded MS-66 and CAC approved, 1861-S dime sold for $51,700. This exact same coin, however, was earlier in the Gene Gardner Collection. On June 23, 2014, it was in an NGC holder, also with a MS-66 grade and a CAC sticker. It then brought $49,937.50. I attended that auction on June 23rd. Many business strike bust and Liberty Seated coins then brought above-market prices. This result on Jan. 7, 2015 is another bit of evidence that prices for rarities are not lower now.
Key 1901-S quarter
Indisputably, the 1901-S is the leading key to the series of Barber Quarters. In this auction, a PCGS graded and CAC approved VF-25 1901-S sold for $18,800. Although this is not a strong price, it seems to be a moderate price in the context of market levels over the last four years. Indeed, on July 13, 2013, Heritage auctioned a different PCGS graded VF-25 1901-S sold for this same price, $18,800. Where is the evidence that coin prices have been falling?
The PCGS graded “MS-68+” and CAC approved 1924 quarter is famous. It was in the “Just Having Fun Collection,” the all-time greatest set of Standing Liberty Quarters, which Stack’s-Bowers offered in August 2012. On Jan. 7, 2015, it went for $20,562.50, which I regard as a solid retail price, certainly strong, more than twice the value of an accurately graded MS-68 1924. Is there a reason to believe that the value of this coin has fallen over the last three years?
1839 half: condition rarity
A few researchers, including R. W. Julian, agree that the halves of 1836 to 1839 could fairly be termed ‘Gobrecht half dollars.’ After all, the ‘reeded edge’ term, while accurate, is misleading as people tend to think the only difference between Capped Bust ‘lettered edge’ halves (1807-36) and Capped Bust ‘reeded edge’ halves (1836-39) is the edge design. These obverse and reverse are of different designs in terms of artistry.
In any event, an 1839 ‘reeded edge’ half in this Platinum Night event is PCGS graded MS-65 and is CAC approved. On June 23, 2014, Heritage auctioned the Gene Gardner piece, which is also PCGS graded MS-65 and CAC approved. I examined the Gardner 1839 and I prefer it to this one. The Gardner piece is very attractive, scores high in the category of originality and is categorized by a neat, mellow orange-russet blend of natural toning.
In any event, this one sold for $39,950 and the Gardner piece realized $38,187.50. Although I keep emphasizing that no one auction result proves a point in regard to market levels, an analysis of many results, on Jan. 7th and 8th, supports my hypothesis that prices for U.S. rarities are not lower now than they were six months ago.
Eliasberg 1905-O Half: condition rarity
There are two 1905-O halves that are PCGS graded MS-68. Both have been CAC approved. The Duckor 1905-O realized $63,250 in August 2010. The Eliasberg 1905-O just sold for $56,400 on Jan. 7, 2015.
There was manic bidding when Duckor’s all-time greatest set of Barber half dollars sold during the Aug. 2010 Platinum Night event. The $56,400 result last week for the Eliasberg 1905-O is unlikely to have been weak. Many experts regard the Duckor piece as a better coin. This price is a bit of evidence that market prices for such coins have not recently fallen, though again an auction result for any one coin should not be taken too seriously.
Queller 1870-S Liberty Seated Dollar: Great Rarity
The $470,000 result for the Queller 1870-S could be erroneously interpreted as evidence that market levels for 1870-S dollars or for Great Rarities in general have fallen. After all, this same coin sold for $805,000 in April 2008 and the Richmond-Lee, PCGS graded EF-40 1870-S brought $763,750 one year ago in the Jan. 2014 FUN auction. It is important, however, to view coins in actuality to understand them and to take changing trends in the coin business into consideration.
Markets for rare U.S. coins were booming in April 2008, and were to peak at the end of July 2008. People then were so eager and excited about buying rarities that they often overlooked substantial imperfections. Moreover, as I emphasized in my recent ‘end-of-year’ article on grading issues, by the middle of 2009, a large portion of U.S. coin buyers were focusing on the coins themselves and considering that the grades assigned by PCGS or NGC might not provide sufficient information.
For example, if a coin is certified as grading 66 though most experts would grade it as 65 at most, then many coin buyers would then only be willing to pay a 65-level price for it, even though it is certified as grading 66. There is a need to understand this point to interpret the Queller 1870-S dollar.
Although both grading services are more liberal in terms of allowing for problems when grading Great Rarities, and this point was explicitly stated in each issue of a monthly magazine that PCGS published during the latter part of the last decade, this 1870-S dollar has been modified and should not have received a numerical grade, in my opinion. The $470,000 result is a little strong for an 1870-S that has the details of an extremely fine grade coin.
Prices in General
Results in the Jan. 7th Platinum Night event suggest that overall market levels for rare U.S. silver, copper and nickel coins, condition rarities and key dates, are not falling, and are not much different from the levels that prevailed during much of the past four years. Demand for pre-1793 American items is probably about the same, though market levels for some pieces have fallen because of a dramatic increase in the supply of rare pre-1793 items entering the marketplace.
Common classic U.S. coins, generics and modern U.S. coins are different topics. I would have to investigate market transactions of those, and conduct interviews, to form a hypothesis regarding current price levels and price trends for those.
Last week, while attending the New York International Convention, I concluded that markets for vintage British and German coins were healthy and dynamic. Market levels for vintage Latin American coins are lower now than then such levels were a year ago, and there has been less trading activity in rare Latin American coins.
©2015 Greg Reynolds
I have examined in hand the Garrett/JHU Chain cent S-3 several times since the Garrett sale in 1979-81. It has incredible cartwheel lustre, a superb flawless planchet and strike and considerable golden-red coruscating lustre. If the lusterless S-4 just auctioned is truly a 66, then the S-3 Garrett coin is a 68.
The S-3 was downright breathtaking when I examined it at Garrett many decades ago (having specialized in choice Chains since 1962). It is much more attractive than the dull brown S-4 period Chain just auctioned that is slabbed 66. The Eliasberg S-4 has partially removed (doctored) crusty corrosion at rev 6 o’clock on “OF” and an imperfectly round flan at 8 o’clock obv (left of 1793 date) due to cutting of the orig planchet.
I partially agree with the author’s contention that increased supply and lower prices have impacted the market. But I recently have had many discussions with knowledgable “oldtimers” in this hobby and virtually all agree that price levels have precluded all but the vastly wealthy from competing at auction or continuing to collect. We all agree the market is in for a substantial correction, maybe down as much as 50%.
Just now viewed the Sotheby’s exhibited Pogue coins on the PCGS Coin Forum Message Boards. The Garrett S-3 Chain cent slabbed as MS-65 RB (which I’ve seen raw in hand) is there. MS-65 when the Chain S-4 periods in FUN was slabbed a MS-66 BN ? They can’t compare with each other for quality or beauty. The S-4 is more like a MS-62 and the S-3 is more like an MS-67 and at least equal, if not superior, to the 1793 Wreath adjacent to it which is slabbed 67.