Posted by Jeff Garrett on the Numismatic Guaranty Corporation Weekly Market Report….
Jeff Garrett has often stated that anyone concerned about the coin market should attend a large coin show and they will probably leave feeling much better.
The 2015 FUN show was a classic example. Going into the show, most coin dealers and quite a few collectors were worried about the market. Most of December had been quiet, and Heritage was presenting a very large number of coins for auction. Precious metals prices have remained weak, and the stock market was attracting most of the investor attention. Finally, the prices for generic gold coins had dropped to levels most thought impossible a few years ago. This was not an encouraging scenario prior to the start of the show.
The 2015 FUN show actually began before most knew it had started. On Tuesday, several coin dealers had rented rooms at the Hyatt for a small mini bourse. This is standard operating procedure for large shows, as everyone wants to get a head start on the action. The mood for the pre-show was cautious, at best. Most who participated were trying to sell, and buyers were reluctant, waiting for signs of market direction. Coins were certainly trading hands, but not at the levels usually seen in advance of a major coin show.
A considerable amount of the pre-show attention was focused on the Heritage auction which, by any standard, was huge. Most buyers were waiting to see how the sale panned out before committing to new inventory purchases. Dealers and collectors did not have to wait long to find out which way the wind was blowing. Because of the late addition of the Partrick collection to the 2015 FUN sale, the Heritage Platinum night (the highest value coins) had been set for Wednesday night. Keep in mind, the show did not start until Thursday. Again, buyers were trying to make purchases without the knowledge of knowing if the coin show was going to be a success or a bust.
Platinum Night consisted of over 500 lots of coins with a minimum value of $10,000 each. The sale started with Colonial coins and ended with Patterns and Territorial coinage. I will leave the coin-by-coin analysis to others, but in general, prices were solid but not spectacular. It is the job of Heritage to gather consignments, and they do a great job of this. The sale contained coin after coin of impressive rarities. One of the first lots sold was a Gem 1776 Continental Dollar, NGC MS 65, which sold for $188,000. This coin is a great example of the current market conundrum. A Gem Continental Dollar is an amazing numismatic item and seldom offered. The sale contained quite a few great coins in multiple quantities, including a dozen 1907 High Relief Double Eagles. A few great coins sold for substantial discounts to prices they had brought just a few years ago. The 1870-S Silver Dollar in NGC XF 40 had garnered over $800,000 when the coin sold in 2008. It was sold to a new owner during Platinum night for $470,000. This pattern was repeated on quite a few super expensive coins.
Great coins have been the focus of much of the rare coin market for several years. These types of coins are still highly sought after, but it is now more of a buyers’ market. For now, there has been simply too many coming onto the market at the same time. In my opinion, this is an excellent time to buy that great coin you have been looking for. I met an old friend yesterday who had assembled a complete set of Proof gold dollars from 1856-1889. This is a nearly impossible task under normal circumstances. The coins have tiny mintages and are seldom offered. He was extremely lucky to have started the project in the 1990s when several great collections entered the market. He was able to cherry pick coins that fit his set from the incredible collections of Pittman, Bass, Trompeter, Childs, and others. Proof gold coins were everywhere at the time. His timing and execution worked extremely well. The collection was assembled, and now Proof gold coins are only randomly available.
The 2015 FUN started Thursday for most participants. The hallway leading to the show was abuzz with activity. Once the ribbon was cut, the show never slowed down. Bourse activity was extremely strong from beginning to end. Our booth was crowded with buyers the entire show. My personal feelings about the market vastly improved once the show started. Nearly every dealer and collector with whom I spoke with felt the same. The FUN organization does a great job putting on a wonderful coin show. The bourse is extremely diversified from the smallest local dealers to the mega operations. The bourse this year exceeded 625 tables. This is a huge coin show, and it is more incredible considering the fact that most of the world and Ancient dealers are having a competing coin show in New York City the same week.
Most of the buyers at the show had plenty to choose from, and activity seemed strong for anyone with a nice inventory. The only dealers who complained to me about having a bad show were those with a limited offering of material. Many dealers forget the old saying—you can’t sell from an empty wagon. This takes courage when the market is less-than-strong, but those willing to stock attractive coins are being well rewarded. This brings up the subject that is probably the biggest factor in the market today. Buyers want attractive coins. This does not mean beautifully toned or premium quality coins. Collectors simply want coins with nice eye appeal.
In the past, the market sometimes viewed rare coins more like a commodity with close buy-sell spreads. This might work for generic gold coins, but not for Proof Type coins. Most of these coins look different from each other, and the prices realized for them reflect this. In the next few weeks, market pundits will be closely examining the market results of the winter auctions. One theme will be consistent, attractive coins did extremely well and less-than-perfect coins fared poorly. When taking advantage of the current oversupply of rare coins being offered, remember to buy those with great eye appeal. Bargains are not the best route when assembling a collection.
Years from now, you will hopefully look back on 2015 as one of the greatest buying opportunities in decades. The 2015 FUN was a wonderful show for those who participated. Hopefully, the rest of the year will be as successful!
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