By Laura Sperber – Legend Numismatics ……
We’ll be brutally honest – the coin market is very choppy. You can say its slowed and cry the sky is falling or you can see all the opportuntiies. There are many areas where you can buy some incredible deals right now (we’ll even include generics). There are also several areas that are on fire-REAL colored Morgans, Standing Quarters, and Bust 25C and Bust Halves to name a few.
The worst thing to buy or own right now is what we’ve been telling you all along you should not all along-DRECK (overgraded, ugly, or messed with coins-value or grade has nothing to do with the term). Dreck widgets have become pretty much worth cents on the dollar and have seriously clogged many inventories-thus leading to many dealer illiquidity issues.
Look in any major auction for validation of what is and is not hot. Fresh, eye appealing, and properly graded coins are still doing VERY well. Monster coins-they still bring monster money (like the 81S PCGS MS68+ Legend auctions sold in the Oct Sunnywood Colored Morgan sale for a world record $45,825.00 after multiple bidders duked it out). If we were talking about a low end not so nice looking 81S in MS68-that coin probably would not even have sold. We call the market choppy-some call it selective.
Money simply is not free flowing into coins right now for whatever the reason. However the money that is there is smart and knows to get everything it can for its buck. That money (at least from our point of view) demands real quality. We think as the stock market gets better people like to pull their profits and put them in things like collectables. Our former partners in coin auctions-Morphys, just ran a 60 lot car sale which produced record prices with several million dollars spent. Another fancy diamond brought a record multiple million dollars last month. The list could go on, collectors do NOT have any real shortage of money. The coin market simply is flooded with too much dreck! Short term, the market will be slow for awhile until it all flushes out. We think it could take months to a year. Long term, people will realize stunning profits from the great deals they can buy right now.
We’re not trying to hype or hide how the market really is. But if your scared or are upset some of your coins have gone down-then you should not be buying. Rare coins are no different than any other market. Things can not keep going straight up forever without a breather. Rare coins are along term proposition-something few people really understand or ahere too these days. The size of the current market is bigger and as hungry as it ever was. That deep “black hole” we keep refering too is also hurting the market by not giving back any of the inventory thats now held by strong hands. So whats really left? Piles of unwanted dreck. When it backs up like it has-it affects all prices to a degree. The power of demand though will eventually break the clog and make prices rebound. Its happened before.
A final note: here are a few critical observations: there is no abnormal amount of collectors taking advantage of the terms we are offering. We can NOT go out on the bourse floor and buy nice better coins-there is no glut of those coins (dreck is a different story). We see NO dumping of coins by collectors. We will concede two major collectors did sell out around ANA when Pogue was announced. Thats all we have seen so far. Better coins are NOT going down in value (even better gold is stable). New collectors are still coming into our market. Attendence at the Baltimore show was slightly above average overall-and very good on Thursday.
Have to clarify yet again after reading some nonsense tonight. Bob Simspon is NOT selling. He is pruning. We assure you, Mr Simpson is buying without hesitation the coins he really wants. He has too many coins in areas that aren’t high on his list. He is the person who bought the H.01 1801 NGC MS67 out of Garner plus several other coins. Do NOT put him in the same context as Gardner or Pogue-he is NOT a seller. Think about this, he has been probably the most agressive buyer of coinsover the past decade. His collection is far more extensive then anyone (save for us) knows! The MS Barber Dime set just takes up room (which he does not have a lot of ) and he does not think the coins are so pretty. Those don’t even account for 1% of his numismatic holdings!
Talk about the frozen zone. We could have bought $5 PCGS MS64 Indians CAC for $2,000.00! Those were just $3-$3,500.00 in the past 6 months. NON CAC MS66 Saints have fallen to insanely ridiculous levels (CAC’s have held and are now BID at $3,500.00). Its wild though how we are hearing this stuff is not selling well. The chances of gold dropping below $1,000.00 are slim. And if it does, so? You need to keep trading. In this world today, it won’t stay down long at all. We recommend buying up all the better $10+$20’s 64-66 you can right now. They are just too darn cheap. Ditto for MS64 $5 Indians! Also, we love the fact you can buy coins like $2.5 in MS64 for UNDER $800.00 now. Great time also to average down if you need too.
We also have our ears to the ground. A few of our bigger Wall Street collectors are looking to buy gold. These are guys really in the know. To us, thats a huge signal. We tried to buy some gold, but there was no huge supply on the floor. We did flip the few $5 Indians in MS64 we bought immediately.