World Colonial

On 12/9/2021 at 11:53 AM, GoldFinger1969 said:

I agree on balance the Fed has been spiking the punchbowl but they have also taken it away at times.  And they are preparing to do so again. 

Ok, last post on this topic, for now anyway.

One thing I want to make clear is that I am not always uniformly bearish, even in this environment I call a mania.

Over the last year, I have mentioned the oil stocks a few times.  I didn't buy any because of my personal situation.  It's not that I don't have the money but cannot afford to be wrong now for other reasons.

The oil majors (CVX, RDS and XOM) were substantially depressed, historically on a relative basis.  These examples more than doubled from the 2020 lows (somewhat more than the S&P 500) but were (and are) much better values despite the relative performance.  Even buying noticeably above the 2020 lows would have been a big winner.  Good cash yield for waiting with a strong (though weaker than previously) balance sheet, as opposed to practically everything else.

Maybe next time, whenever it happens.

On 12/9/2021 at 11:55 AM, GoldFinger1969 said:

The market for TSLA is discounting not only auto but software services (higher margins) and batteries, solar, and electricity re-sales.

I personally would not buy the stock here but you can VERY EASILY justify the price if they execute perfectly.  If they don't, it's overpriced by 20-30%.  If they screw up bigtime, it's overvalued by 50-75%.

There is no absolute value, only relative.  I can never justify Tesla's current value or any company similarly valued, as I consider it to be based upon complete fantasy.  Those other businesses are competing with the utility industry.  Same logic I used for the auto industry in my last post.

On 12/9/2021 at 11:51 AM, GoldFinger1969 said:

The numbers disagree with you.  Check out the corporate balance sheet information from the JP Morgan link I gave you -- debt levels are MUCH LOWER especially in the Energy sector where the problems were 2016-20.

GMO of Boston has done extensive work on bubbles.  They are value investors and believe stocks will LOSE MONEY from here.  Even they say that most of the market is very pricey but NOT a bubble.

To me....a bubble is one that needs to decline 75% (or more) to reach fair value.  That's what the NASDAQ did in 2000-02.

I can find numbers to agree with me too.  It's not like its one-sided belief.  I've read Jeremy Grantham (GMO) where he has claimed it's a bubble, including recently.  I read Hussman regularly where he uses empirical data to support his claims.  I presume you disagree with him too.  I also read Elliott Wave International who are considered super bears because their long-term US stock market forecast has been wrong to this point.  But they have been right on numerous in other markets and with US stocks over shorter horizons too, including identifying the peak pre-GFC and the exact low on March 9, 2009.  If they were not, they'd be out of business now.  They have cited numerous indicators (both valuation and sentiment) to support it's a bubble.

Corporate debt levels are much lower compared to when?  Certainly not pre-GFC. 

On 12/9/2021 at 10:28 AM, GoldFinger1969 said:

I'm not a fan of BitCoin or crypto.  But Tesla and some other SPACs have grown into their valuations.  The bear argument on Tesla has been proven wrong -- just as it was on Amazon.com.

We disagree again, except on crypto.

So, Tesla is reasonably valued in the vicinity of a $1T market cap?

Is this based upon earnings, revenues or some other fundamentals I don't know about?  Or Wall Street hype using something which isn't tangible?

The EV market is growing but it's at the expense of the ICE market.  There is no volume growth in most auto markets and where there is, Tesla isn't either there at all or is a minor player with numerous competitors (like in China).  Any revenue growth in the US is entirely from increasing MSRP which a noticeable proportion of the customer base can only pay due to basement level credit standards and artificially cheap money.  It's entirely due to the fake economy.

Tesla's market cap fell recently but last I checked was comparable to the seven largest auto companies (by market cap) in the world: Toyota, VW, GM, Ford, etc.

If Tesla was of equivalent size to even one of them (meaning it's revenue and especially profits was a multiple of current levels), it would be considered a "mature" company just like the rest of them and its market cap would be worth a fraction of current levels.

So yes, I can reasonably conclude Tesla is selling at bubble prices, just as its ratios demonstrate.

On 12/9/2021 at 10:26 AM, GoldFinger1969 said:

I agree bonds are bubble-like.  But that is going to provide support for the stock market.  Money has to go SOMEWHERE and if you can't get 4% in a money market fund....or 5% in a bond....you'll buy stocks yielding 2-4% with the chance of capital appreciation.

Today, "money" is mostly someone else's debt.  It can also disappear into nowhere just as it appeared out of nowhere.

What you are now admitting is that one mania (bonds) is supporting another asset class (stocks) which you claim is not in a bubble.

On 12/9/2021 at 10:26 AM, GoldFinger1969 said:

Economies are much less boom-bust than in 1930 or before.  Plus, our knowledge of economics, monetary policy, and automatic stabilizers is much more today than pre-Keynes and pre-Friedman.

I know there is less boom and bust than in the past.  I addressed this in a prior post above in this thread.  The belief you state is almost universally accepted.  

On 12/9/2021 at 10:13 AM, GoldFinger1969 said:

His point is that if you believe that inflation, interest rates, and ERPs are going to march slowly higher over the years it is a tight analogy.

I disagree with him.

On 12/9/2021 at 10:13 AM, GoldFinger1969 said:

I said that valuations today are on the high side, compared to pretty low in 1946.  But that does NOT mean a bubble.  Tech stocks were in a bubble in 2000 because they didn't have earnings for the most part and those that did (like CSCO or MSFT) sold at 60-80x earnings. Today, Big Tech is pricey but often sells at 20-35x EPS.  Not cheap, but not a bubble.

You are still only measuring it by earnings.  That's why we continue to disagree.

What I would like to know is, if today isn't a bubble, then what exactly is one?

It's also not possible to separate the debt bubble (global debt, not just US federal) from the stock market.  That makes no sense.  Increasing debt and the debt mania is the enabler or at least a rationalization for the rising stock market.  It lowers the P/E by inflating earnings from lower interest expense, borrowing for share repurchases, and sustaining the fake economy to inflate revenues.  Since 2008, corporate America has effectively performed a collective leveraged buyout concurrently gutting its balance sheet.  How do you not see that?

On 12/9/2021 at 10:13 AM, GoldFinger1969 said:

Our debt is high but we are a reserve currency superpower.  That means betting on our demise is going to be a losing proposition even if turns out to be right because neither you nor I will be around to see the payoff (see my GREECE analogy above).

I'm not specifically referring to US federal debt but global debt from all sources.  If you want to make this argument, the US cannot prevent a "credit event" from occurring anywhere else in the world and neither can any other central bank.  Whether any response "works" or not is psychologically determined.  See my above response.

On 12/9/2021 at 10:13 AM, GoldFinger1969 said:

"Normalizing" fiscal (already being done) or monetary policy (coming) will mean SLOWER growth it does NOT mean an economic depression.

You are joking right?

Both fiscal and monetary policy have been anything but "normal" since 2008.  There also isn't even a hint that there is any intent to do it, unless of course, your definition of "normalize" is entirely different than mine.

On 12/8/2021 at 11:39 PM, Quintus Arrius said:

@World Colonial

While I have difficulty identifying the sources from which you base your prognostications -- the hue and cry has been raised many times before -- I have to admit I find your comments to be insightful and at times bewildering and confounding but refreshing in that you hold nothing back. It is almost as if there ought to be a trailer reading, fail to take heed at your own peril.     🤔 

There aren't any specific sources.  I do a lot of reading to obtain ideas from elsewhere but I don't need to rely on someone else to form my own conclusions.

There is no "trigger event" or "black swan" necessary to end this mania because this mania (and the associated fake economy) aren't the result of any economic "fundamentals" but manic psychology.

The mania will end when the psychology enabling it ends, it's as simple as that.  When collective psychology changes, it won't matter what the government or any central bank does because anything they do will be viewed as inadequate or a failure.  This is what happened during the initial stage of the GFC which is why both the government and FRB did what they did in 2020.

It "worked" last year but with the side consequence of blowing the bubble even larger and distorting the economy even more by further "kicking the can" down the road.

On 12/9/2021 at 12:56 AM, GoldFinger1969 said:

Stock prices go up 2/3rds of the time.  Living standards, GDP, and lifespans increase over time.  Technology, education, and medical progress expand and continue to be accessed by more people.  "Poor" people today have running water...heat....air conditioning....smartphones.....HDTVs.  30 years ago, only the "Rich" had those things.  Betting on DECADES of impoverishment is not a wise bet.  Even The Depression lasted only a decade and our knowledge of economics and how to avert crises was light-years behind what we know today.  We got lucky with the 1918 Spanish Flu burning itself out yet it still took 500,000 American lives out of 105 million.

There is absolutely nothing in history which guarantees that living standards should or will increase for most of the population, in or out of the United States.  It may or may not happen but it's entirely a faith based assumption.  It's predicated on circumstances specific to our time and recent past which may or may not last and are not within the control of any society or government.  In the more recent past, it's actually primarily been from pulling demand forward by increased debt.  Someone is going to have to pay it back, even if it's by inflation or default.  It isn't going to increase forever either where there is no consequence.

The depression did not happen due to any "policy mistake".  I know every conventional economist will dispute this but it's a myth.  It's the thinking that's driven post WWII monetary and fiscal policy under the false belief that government has the ability to prevent declining living standards.  By some miraculous coincidence, this ability somehow only applies to developed countries and central banks, not anywhere else.

What government is actually doing is distorting the economy and financial system to where when they "lose control", the consequences of these economic and financial distortions will be compressed into a shorter time period into one or a lower number of "events" instead of spread out as it was in the past.

If anyone claims this isn't true, then they believe in something for nothing.  Virtually no one believes it because the "fat tail" equivalent event hasn't happened yet.  This is what leads practically everyone to believe it never will.

On 12/9/2021 at 12:56 AM, GoldFinger1969 said:

Betting against America has been a losing proposition.  I think it will remain so.

I received a similar reply from someone on the PCGS forum last time I was there.

The US of today and the recent past isn't the same "America" you infer and the change isn't an improvement either.  On the PCGS forum, the other poster quoted Buffet using an argument from authority logical fallacy to supposedly rebut my comments.

There has been substantial social decay over my entire life, back into the 1960's.  That's one reason for 21st century fiscal and monetary policy.  At least some of these policy makers must know it.  They see what the Balkanization of the country and breakdown in the social order implies for the future of the country.  This is a topic beyond the scope of this forum and it's one where even more disagreement exists than in finance and economics.  The point I am making is that social decay is the actual primary root cause behind the deteriorating economic "fundamentals", including exponential increase in US federal debt.

The more immediate question is, is there anything preventing this fake economy and bubble from continuing for the immediate future?

No, because people aren't robots.  It's possible the current manic optimism will allow the fake economy to persist for the rest of the decade (into 2030 or something like it). 

This isn't something I will bet my future on but anyone else is free to act otherwise.

On 12/9/2021 at 12:56 AM, GoldFinger1969 said:

There are some potential pitfalls.  I am not sure the Euro will hold together (they've wasted a decade of low rates to get their house in order)....China is turning authoritarian and will lose 25% of their labor force as their labor supply SHRINKS in coming decades (ours will still grow albeit at a slower rate of growth)....Asia and South America need to get themselves weened off exports and commodities, respectively.

The middle class globally will DOUBLE in the next 20 years.  That is HUNDREDS OF MILLIONS of new consumers of goods...services....and precious metal (gold, silver collectors).  Yes, many will trust deposits in banks and crypto on their smartphone but many will want a small stash of gold or silver, too.

Market prices aren't determined by the economic "fundamentals".  Contrary to what most people believe, it has little if any predictive value.

Priced are based upon collective optimism or pessimism.  This is true for both individual securities and entire markets.  Look at Bitcoin, Special Purpose Acquisition Companies (SPAC), and stocks like Tesla or Uber.  None of these are priced based upon the "fundamentals".  Bitcoin and crypto currency are literally nothing. SPAC are the equivalent of the 1720 South Sea Bubble example "an undertaking of great advantage but no one to know what it is", in spades.  Tesla is a real business but has lost billions and faces entrenched deep pocket competitors in a mature market.  Uber and all other similar companies are cash burn machines that should be worth zero and would be in any sane market.

The US stock market is about the only market in a current bull run.  It's on an island in deep outer space and has been post GFC.  This valuation difference isn't supported by any meaningful difference in "fundamentals" either versus the rest of the world, but manic psychology.  

On 12/9/2021 at 12:56 AM, GoldFinger1969 said:

Bottom Line:  Certain pockets are very expensive, even bubble-like....but large areas of the market offer good value for 3-5 years down the road.  You just have to be selective.

It isn't just certain pockets.  Look at the entire bond market.  Are you going to tell me it isn't in a massive bubble?  The US stock market (which has also never been more overpriced) isn't the only market and doesn't exist in a vacuum.

The "good value" you infer is based upon the fake economy.

On 12/9/2021 at 12:56 AM, GoldFinger1969 said:

I think you overstate the potential for an economic downdraft.  Even a 3rd-rate tourist-dependent Socialist economy like Greece took 30 years to collapse.  I wouldn't bet against the U.S., China, or even the EU with Eastern Europe a dynamo.

At market peaks, the economic fundamentals never look bad to most people.  That's how you get manic bubble valuations.  Why would you expect anything else?  Do you think the environment looked bad at the US stock market peak on September 3, 1929?

On 12/9/2021 at 12:56 AM, GoldFinger1969 said:

If a collapse does happen -- and I doubt it does -- it will be quick, just like corrections.  Slow-moving trends to the downside are compressed and have been since the 1980's as information now moves at the speed of light.

I don't expect an economic collapse like the one into 1933.  The economy and actual state of American society (and much of the world) is far worse now but optimism and belief that government can prevent declining living standards means that politicians are guaranteed to do "something" to try to prevent it, just as they did last year and during the GFC.

As for market prices, I ultimately expect a decline worse than the 1930's but I don't know whether it will be quick or extended.  I also don't know whether the decline will be worse measured in nominal or inflation adjusted prices.  US stocks lost 89% from September 3, 1929 to July 8, 1932 but the decline was less (excluding dividends) adjusted for price changes than from February 9, 1966 to August 13, 1982.

On 12/9/2021 at 12:56 AM, GoldFinger1969 said:

Yes, and if I could post a great research piece from Equity Strategist Mike Wilson of Morgan Stanley (maybe you can find him on CNBC.com) you would see how he is talking about the end of the pandemic being the end of WW II circa 1946.  That period ushered in a 35-year bear market in bonds with yields doubling from 2% in 1946 to just over 4% by the mid-1960's.  Equities did very well over the period because valuations were lower, dividend yields higher, and earnings growth poised to accelerate from good-to-outstanding thanks to global growth.  Today, valuations are high, dividend yields low, and earnings growth mediocre-to-OK at best with China a big question mark.

Check this out:

https://am.jpmorgan.com/us/en/asset-management/adv/insights/market-insights/guide-to-the-markets/?gclid=Cj0KCQiAzMGNBhCyARIsANpUkzMis1VmsMCLxB3YVpCNFR7EC_EgKJvDY0_qY7Vi9kVPiQAaOADEodoaAoMUEALw_wcB&gclsrc=aw.ds

Focus on pages 4, 5, 9, 11, 23, 47, 54, & 67.

There is no analogy between the end of WWII and now.  

Sentiment and valuations then were the opposite of now and to imply that after a 20+ year bubble (since 2000) we are going to get up to several more decades of market advance (that's what happened after 1946 into 1966) makes no sense.

The fundamentals then are also practically the mirror opposite of now and the recent past.  US federal debt was high (as now) but I see no other similarity.  

The primary reason I disagree with you and the financial community on valuations is because all of you insist on primarily relying on one of if not the weakest measures of value, earnings.

Yes, earnings have been unprecedentedly high during most of the mania (mostly excepting Q4 2001 to sometime in 2003 or near it and the GFC) because of the fake economy.  When the government runs consistent deficits of $1T+ ($3T in 2020), it has to show up somewhere and much of it ends up in corporate net income.

That's not evidence of a fantastic economy but a distorted one.  If the economy has been so great, why is it necessary for the government to run deficits to these levels for over a decade and why has the FRB found it necessary to run what used to be considered extreme monetary policy over the same time period?  (This is a rhetorical question. I'm not really asking.)

Let me give you the only real answer:

One:  Those in charge are really dumb or ignorant enough to believe there is something for nothing.

Two:  A combination of "kicking the can down the road" and political expediency.  At least some of these people must know the real state of the economy (and society) and understand or infer the social consequences of "normalizing" fiscal and/or monetary policy, a (massive) economic depression.

On 12/8/2021 at 9:23 PM, GoldFinger1969 said:

I don't think that the collapse in the "asset mania" (you mean stocks and bonds and maybe collectibles and crypto ?) will impact coins because neither the underlying metal prices nor the numismatic values have had an extended rise. 

You could make a stronger argument that we are an out-of-favor-sector and $$$ should rotate into our group like a stock sector that sits out a bull run or bubble mania.

Previous "coin manias" occurred in the 1970's when gold and silver went up 35-40x.....1985-1990 with TPGs and Wall Street rumours fueling a 400% rise in 4-5 years.....and MAYBE 2002-12 as gold went up 6-fold and some sectors overshot to the upside on expectations of greater PM gains which never materialized and bullion, numismatic, and traditional American coins proceeded to go into a bear market for 10 years.

We have different opinions on this subject for a variety of reasons.

First, based upon history, I know the major asset markets (bonds first, stocks second, and real estate third) are a lot more inflated than you have implied in your prior posts.  This overvaluation isn't uniform across every asset class and market versus the past, but it absolutely is in the aggregate. As an example, most global stock markets are lower or barely higher versus 1999 and 2007.  Conversely, bonds and debt generally in all major markets are far more inflated than ever.  It's not even close and this is the asset class ultimately supporting everything else.

Second, I also know the actual economic "fundamentals" are either disproportionately mediocre or awful today and have been since 2008.  It's artificial prosperity supporting unsustainable living standards.

So, manic collective psychology supports ridiculously overpriced aggregate asset prices while a fake economy since at least 2008 (from unsustainable government deficit spending and the loosest credit conditions in human history) supports inflated living standards.

The combination of these two is what leads me to conclude that asset prices and living standards are ultimately destined to decline and fall a lot more than you believe.

I haven't claimed it will happen overnight and it doesn't appear "imminent" either, (since this mania keeps on going like the Energizer Bunny) but it's going to end because there is never something for nothing in life.  When it ends, it's like to be a long-term process, not an event.  Probably measured in decades and not months or years.  (My guess is the biggest decline in asset markets initially with the larger decline in living standards later.)

With coins, as such a small illiquid market, it's entirely possible that gold and silver will provide support initially, as it did in the 70's.  But I wouldn't count on it for most coins of any "meaningful" value.

The coin price level is far more inflated and most people will almost certainly become poorer or a lot poorer.  

The primary reason coins increased this much since the 70's isn't due to bullion prices, though this was the initial catalyst.  It's primarily a combination of an increased number of affluent buyers (from the financialization and marketing of "collecting") while the asset mania made it much easier for them to pay higher prices due to this huge increase in mostly fake wealth.

On 12/8/2021 at 9:23 PM, GoldFinger1969 said:

You make a fair point, at the same time, lousy coins today are more easily ID'd.   So people are paying up more for quality, CAC or CAC-like higher quality coins within a particular grade.

Relying on a Red Book from pre-1970 or pre-1986 (TPGs) is light-years different than today.  You really needed to be an expert and spend lots of time to justify what were relatively high prices for some coins, even thought the absolute price level might have been lower than today.

The risk was different then versus now.  There was greater risk of buying fakes or over graded coins.

Today, it's easier to avoid both but when a mistake is made on one of the higher or highest graded coins, it is a lot more expensive than it ever was then.  This is a function of the much higher price level and price spreads between grades.

On 12/8/2021 at 9:23 PM, GoldFinger1969 said:

I think once the TPGs standardized grading in 1986/87 buyers became more confident that they were buying accurately graded or at leaast market-acceptably graded coins.  A TPG might be off by 1 grade, MAYBE occasionally 2 grades...but not 3 or 4 or 5 or more.  If a dealer said a coin was AU-58 and a buyer said it was EF-40, no transaction would take place before the TPGs.

Even among veterans here at the NGC Forums (or other coin sites)...when you have GTG Threads or a coin that folks are asked to grade, even veterans with DECADES of experience in that particular coin are often off by 1 or 2 and sometimes more increments.  It's simply never has been nor ever will be an exact science.  Even CAC, standing behind their grades with $$$ and John Albanese's well-deserved reputation and penchant for being a tough grader of gold coins, has been known to have a blooper every now and then.

The confidence buyers have to pay "recent" prices (varies with the coin) where it is "material" (to them) is overwhelmingly contingent on the buyer's belief that they can recover most, all, or more than all of their money back.

Part of it is related to TPG (or CAC) and part of it is due to other reasons such as "investment" buying.  The "reason" doesn't matter, only that they believe it.  Without this belief, there is no possibility the price level would be anywhere near its current level because too many coins sell for prices which are "too high" for the collectible merits where hardly any buyer will pay it as an alternative consumption expenditure.

 A small proportion (which I will get to in my next reply) are also dependent upon the asset mania.  The buyer presumably (usually) finds it interesting enough as a collectible, but not anywhere near its current or recent price.

Look at the 1933 Saint or 1822 half eagle, as it's no different than high priced art.  The asset mania is the only explanation for these inflated prices.  Without it, prices would be a low fraction.

On 12/8/2021 at 9:23 PM, GoldFinger1969 said:

You are correct, there has been a financialized collecting premium as coins become more specialized with more accurate grading (good) and hyped-up labels (bad).  But net-net, I think it's BETTER today because things are more transparent.  I can get dozens of price quotes for a generic 1924 MS65 Saint or several quotes in the last month for a more specialized 1923-D MS66 CAC Saint.

That wasn't the case 25 years ago and would take you days of calls or driving around 40-50 years ago.

I wasn't expressing an opinion on whether it is "better" or "worse" in my last post.  Only stating (once again) that these price differences aren't actually based upon collecting, but financially motivated marketing.  I have stated numerous times on coin forums but there are a lot of collectors and "investors" who have no clue of it.

If anyone wants to spend their money that way, great.  Just don't believe the fallacy that it's because the buyer likes it that much as a collectible because the anecdotal evidence (mostly from coin forums) demonstrates they don't.

This is exactly what common sense leads anyone to believe, as there isn't a dime's worth of practical difference between many and sometimes most of these coins. 

And it isn't just Saints or US coins either, as evidenced by some of the examples I have documented here with coins I have owned.

Your last point is also a function of the internet, not my prior reply.  This is an improvement (undoubtedly) but a separate consideration entirely.  It's also easier to sell anything generally on eBay.

On 12/8/2021 at 5:03 PM, Quintus Arrius said:

I am going to have to call you out on this one; no way I am going to let you slide.

There is numismatic value. And then there is bullion value.

If we dispense with grading guidelines, all the leading economic indicators come to a grinding halt. That will be the death knell for the hobby as we know it.  🐓 

I will agree with you on one thing.  It would be the end of financialized "collecting".

The "numismatic" value is in the label.  Most buyers can't grade most coins in these grades "accurately" outside the holder and most would not pay these premiums without the expectation of getting most of their money back.  I'll grant you more of those who buy these specific coins (in 65 or better) can on occasion, but that's because of money.  No one cared enough before.

You're aware of how these coins were priced up to the early 70's I assume?  The change in the pricing is due to the financialization of "collecting" (buying coins as "investments") in the 70's and marketing (TPG labels, CAC stickers, and registry sets) starting in the 80's.  It's the same coin now it was then.

For the consensus to be true, here's what someone has to believe.

Until the 1970's, prior buyers were operating out of ignorance by treating the coins essentially equal.  At some point starting in the 70's (or maybe the late 80's for Saints), buyers experienced a collective epiphany where they miraculously discovered the merits which no none knew before.

Sorry, but nothing of the sort ever happened.  It's nonsensical.

When the asset mania collapses (which it will "eventually"), buyers will collectively forget this epiphany to once again mostly or entirely view these coins as their predecessors.  That's what happens when the price of a collectible is (totally) disconnected from the actual collectible merits..

I also wasn't trying to single out Saints.  This is equally true any most series where buyers have the same or similar motives.

On 12/8/2021 at 11:00 AM, GoldFinger1969 said:

Auction Results:  Recent GC activity had an MS-66 1927 Saint go for $3,400/$3,825 (1 bid)...and that MS67 1924 Saint finally got 1 bid and sold for $12,000/$13,500...a 1923-D MS66 Saint sold for $4,800/$5,400 (I bought one even nicer IMO 2 years ago at FUN for $3,500).

A 1908 NM MS-66 OGH got lots of bids and went for $3,118/$3,507, which I thought was kinda low.....an MS66+ 1908 NM Saint $3,400/$3,825 but only 1 bidder.

Finally, an AU58 1927 Saint went for $1,900/$2,137 as a bullion substitute with gold trading at about $1,800 2 weeks go.

Since the grades mean nothing to me, I'd consider every one of those bullion coins.  Large to big premiums for a label on a piece of plastic.

On 12/6/2021 at 9:49 PM, Woods020 said:

I lived in Lake Mary. If you can stomach I4 it’s a nice area around there. 

I have been there several times. I like it.

On 12/5/2021 at 11:02 PM, Woods020 said:

Where are you moving to in central Florida? I lived in that area for a few years. Have a house down there I’m thinking of selling after the new year. May have a house for you 😂

Don't know the timing yet but if it ever happens, somewhere in the Orlando area.

No, but if I move to central FL as I might early next year, I might consider it later if I can free up the time.

I suspect cost and lack of interest rank first and second, in that order. 

On 11/19/2021 at 11:19 AM, Hoghead515 said:

Thats a very good point and something ive thought about from time to time. I think if they would do shorter runs of coins it would make it alot more interesting. 

What I meant is that I believe collectors would find it more interesting if fewer coins were issued but this isn't directly connected to the mintages.

Look at the majority of US modern commemoratives.  How many collectors would even notice if most of these coins never existed?  They would notice if the program was terminated (as it was in 1954) or the Mint skipped one or more years but not because of the themes.

If a collector treats their collection primarily as an alternative consumption expense, financially it doesn't matter.

Above some unspecified level which varies by collector, they usually do care.  I don't know how many have "noticeable" amounts "invested" in NCLT but don't believe that they wouldn't have an issue if the price declines "noticeably" below their cost.

That's a lot more likely with this endless flood of "product" and what I believe will happen in the future, outside of changes to the spot price.

On 11/19/2021 at 11:24 AM, VKurtB said:

I don’t agree. The classic Commems haven’t done that, and at least LATELY the modern mintages are kind of similar. 

Not sure where you disagree.

Obviously, all NCLT is owned by someone unless it's literally lost.

I'd describe the US classic commemorative series collector as predominantly a hole filler.  A large series where the majority of coins have little if any actual connection, disproportionately uninteresting themes which most people have never heard of or know nothing about, and which isn't even close to being scarce.  A full set still sells for over five figures in practically any decent quality (like an MS-63) which is hardly cheap for what is actually being bought.

The mintage of most NCLT is not actually low.  The mintages of US classic commemoratives aren't low either.  It isn't low because the relevant comparison isn't circulating coinage but other NCLT or maybe proofs.  Virtually no one is buying any NCLT as a substitute for circulated circulating coinage.  In "high quality", most NCLT is not scarcer outside of the most common circulating coinage.  Outside of US proofs dated from 1950 onwards, only a very low proportion have comparable mintages to most NCLT.

As for "forgotten", I was also speaking in a financial context.  Virtually none of this coinage "stands out" and I expect most of it to sell for nominal premiums to the spot price decades from now, once the asset bubble ends because that's the primary if not only factor holding it up now, especially on 70's.

Other than to make money, why does the US or any other mint have to strike so many coins?

I believe that collectors would find a particular theme, coin, or series more interesting and meaningful if it wasn't buried in a sea of endless mediocrity.

Decades from now, most NCLT is destined to be relegated to the dustbin of obscurity and mostly forgotten.

The reverse is not as nice as St. George slaying the dragon but still like it.

I don't like the current portrait or the prior two.

On 11/11/2021 at 12:16 AM, GoldFinger1969 said:

Gold's traditional hedge as a store of value has been eroded by liquid capital markets, the bond markeet, and even BitCoin.

In 1979, both the gold COMEX market and daily FOREX traded about 1 billion dollars daily.  Gold trades $50-$75 billion daily nowadays....and the daily foreign exchange market trades about $5 trillion daily !! 

Your 1979 FOREX data must be off or you are comparing two different sources.  No way FOREX volume was only $1B daily.  It must have been almost entirely off exchanges at the time.

There is some displacement as you indicate, but it's not remotely reflected in the numbers you gave.  The increase is mostly if not almost entirely for speculation or commercial transactions such as hedging debt exposure.

In many countries, residents hold USD currency notes as a store of value and since it circulates parallel to the local currency.  This was true in Argentina  in the early 90's when the currency board was in place.  USD notes also circulated in Bolivia on my visits up to 2007 but since then, have not seen it even once.  The Boliviano has been stable at about 7:1 since then.

Non-US residents in developing countries also tend to have most of their financial assets in one of the "hard" currencies.  Local capital markets are usually relatively illiquid and it's also done for geographic/political diversification.  Or, they own foreign real estate.  What they own locally is held in a private business or real estate.

If you are rich in a country like Colombia where my sister and her husband live, the financial markets are presumably mostly for institutions, though many shares and bonds are listed on foreign exchanges too (maybe most).  This is my inference and my brother-in-law (who is from there) agreed with me.  That's why Miami is the financial capital of Latin America, maybe along with NY.

Outside of metal bugs and coin collectors, I doubt very many developed world residents own physical gold or silver.  To the extent they do, it's overwhelmingly immaterial.  Most metal bugs and coin collectors don't own material amounts either.

In the developing world, I know both are owned as jewelry but it's impractical to own as coin collectors do in the US.  It's not readily available in coin and bar form, certainly in any quantity, it's presumably (noticeably) less liquid with wider buy-sell spreads and it's a high(er) risk proposition to store and transport.  I'd also question whether it can usually be insured, at all.

I did see an advertisement in the LaPaz or Santa Cruz airport (in Bolivia) for a gold storage program on my recent visits, so maybe it's somewhat more available now than I believe or it used to be. 

I don't know what locals think of it but see no purpose in it. I'd own it elsewhere as I have no interest and see no advantage in storing metals in a country like that..