I am about to be exiled...

[EVillageProwler]

Jeff,

 

I think you should stop with all this preaching and analyzing regarding high-priced, high-end moderns. For one thing, you are thinking too much like an investment advisor instead of like a collector.

 

A collector is a funny breed of people. You should know this, because you also are one. Collectors have a weird sense of value. I have two female friends who spend a lot of money on Barbie dolls (and accessories), and I think they're crazy. But, I don't say so, because I know a lot of people who think I spend too much money on coins.

 

The thing is that if you don't especially care for that particular thing, or series, then it's easy to think that it's overpriced. But, if you do collect that, then money becomes secondary to the acquisition.

 

It may be that any or all of what you're trying to say is sensible. But, to a serious, intense collector, none of that matters if it interferes with the goal of acquisition.

 

About all that we can say to a collector is to educate yourself and don't spend more than you can afford to spend. Otherwise, you should just let the collector do his thing...

 

EVP

 

[jtryka]

Cladking: I am not going to fight with you, or insult you. As far as my comments on the idiocy I see in moderns, it has more to do with people collecting slabs as opposed to collecting coins. As far ashelping new collectors it's a difference in approach. To some (I don't know you, so you may or may not be included here) helping new collectors involves taking a $5 coin, adding $30 for grading and then "helping" new collectors by selling said coin to them for $100 or even more. Here is how I help new collectors, in the past I have made presentations and held discussions with school and church groups about the hobby, and the most recent example was my office manager's 11-year-old son. She learned I collect coins, and mentioned her son was working on the state quarter map. Now I could have suggested she and her son only buy PCGS certified MS-67 or higher coins, but given his $10 per week allownance, and her more pressing desire to put her son and daughter though college, that would have been a disservice to all involved. Instead, I bought a set of Whitman folders for quarters from 1965 to date and provided a bunch of P-mint coins to fill some of the holes (Ps are harder to come by here on the west coast) as a Christmas present for her son. I also told her that when they would enjoy many fun hours looking through rolls of quarters to fill the books, and that the most they would spend if they wanted was face value. I also mentioned that when they finished those books, I would help them with the rest of the series going back to 1932. You see it comes down to how you look at this hobby, and what motivates your collecting. I do this for the history mostly, and for the beauty of the designs, and I still can't see how modern condition "rarities" fit with a love of history or artistic design (though state quarters are fun in the history they teach, and some modern designs are pretty). I suppose these sorts of activities are destructive to numismatics if you believe the future of the hobby is dependent on maintaining and expanding what some like myself consider already astronomical prices on common coins.

 

GDJMSP: Thanks for your input, your response was the type I was hoping for from the other side of the street. But it's really not surprising that most responses were ad hominem arguements designed to destroy my credibility rather than address the issues, which should be expected anytime you attack a sacred cow that so many have a vested interest in maintaining (I still find the biggest surprise the way that every response ignored either deliberately or accidentally, my request that everyone explicitly disclose any interest that have on either side of the argument). That said, I have received a number of e-mails suggesting ways to improve the study, and I plan to do it, by adding additional series, as well as other data points as you have suggested. My biggest hurdle is actually collecting and inputting this data as most services I can access do not have the ability to download data directly into a spreadsheet. I would welcome your sharing the data you have collected, and would love to include it in the next iteration. I was surprised at some of the data, most notably the higher grades available in Morgans and Walkers, as well as the low premiums associated with FH SLQs (I originally included them because I thought they would have high premiums for higher grades and that would make the state quarters not look as bad). At any rate, send me a PM, and I will give you my e-mail address to send your data. Feel free to include any other suggestions you might have. I will eventually post the results over here, since I am no longer welcome across the street.

 

 

[jtryka]

point well taken EVP. I suppose that my analyst side comes out since it seems like most of the modern issues surround the financial rather than collecting interests. But as a collectors, my passions can be aroused, and contrary to what others think, my motivation is not to discourage new collectors, but the exact opposite. My concern is what will happen when the bubble eventually bursts. I have lived through the mass exoduses before, in the early 80s and 90s, and I really don't want to see that happen again.

[cladking]

Modern condition rarities are beside the point as long as you continue to site "moderns" as though they're homogenous. High grade coins are important to most modern collectors whether they collect from circulation or from rolls and mint sets. Virtually all of the unc moderns are true uncs. They've been relatively well protected and they haven't had many decades to slide around or acquire layers of toning. They were not saved in AU or even XF. They are mostly either unc or clearly not. Most were horribly made so it's of little surprise that collectors seek nicer specimens and it isn't overly surprising that in cases where the best coins are scarce that competition for these coins can become fiercer than many might think warranted. While condition rarities are only a part of the modern markets there are many for whom they are an important part. Again I ask, how is the newbie supposed to feel when he comes here and finds you slamming his holy grail?

 

As far as your comments about my activities, I can say only this; If I could buy a coin for $5 and sell it for $100 I wouldn't hesitate, assuming fair value was given and recieved on both ends of the deal. In actuality pop tops rarely cost anything close to $5. Typically figure about double face value or so. It also is nearly impossible to deal in these coins since there are no price guides. One can't get together with a buyer or a seller since prices are ephemeral.

 

There are enormous changes coming in these markets and they will soon become far more active. It will soon be impossible to buy pop tops except as pop tops. Much of this vastly increased activity will occur in the just missed grades that many are constantly suggesting as a better buy.

 

Somehow I doubt you'll find this soothing.

[jtryka]

So tell me, who will eventually contribute more to the demise of new collectors, my slamming their holy grail, or the collapse of prices that send everyone to the exits, just like what happened with gold in 82 and sabbed Morgans in 89? Then we're left where we started, with people like me continuing to collect and help others, and the people who fed the flames of speculation, seaching for the next big thing to hype.

[cladking]

Certainly a price collapse would drive more out of the hobby than anything an individual could do. While we may disagree on when or if such a collapse is coming, I certainly respect your right to warn newbies that it is possible. My problem is that this is almost the only message we often give the newbies. There has been one bubble after another in the coin market for many years, those who have been slow to get in or get out have been burned. This is because there has been a stagnant or declining number of collectors frequently moving in tandem from one hot area to the next. We collectors were always too busy jumping on the bandwagon in these previous bubbles to even think about warning each other that these "fine investments" might be over priced or over hyped. Now the hobby is growing and while it may be open to debate about whether these are the finest coins or finest investments, the fact remains that they are what the newbies are buying.

 

It seems likely that not only will more stick around with encouragement but that they will progress more quickly with

encouragement.

 

So warn them if you must, but try at least try to keep your warning specific and remember you could be on the wrong side of this anyway.

[darktone]

jtryka- I found this place! It looks like I have been an inactive member for a while. mike

[Guest]

When I first got into coins in 1962-64 there was a boom on in new proof sets, circ set building of Lincolns, Buffaloes, etc. 40 years later those same proof sets aren't worth a whole heck of a lot. Too many were made and still remain. I remember getting a semi-key VF 1924d Lincoln cent for Christmas in 1964. To this day, that coin is STILL worth slightly less than what it was then! Throw 1950d nickels into this mix too. Isn't it possible that state quarters and the other bulk moderns are heading down the same path? Huge demand...maybe........but the potential supply is equally as large.

 

roadrunner

 

 

[keithdagen]

cladking,

 

There are CERTAINLY many modern coins that are rare in middle to high grade uncirculated. Ikes are a quick example, where very few coins exist in the higher grades, and the coins have been around long enough that many are now aware of this.

 

Coins like that, I have no problem with, and you can cite the examples better than most as you specialize in this area of the hobby. The problem lies in the idea that MANY modern dealers don't focus on those issues, but on the grades, regardless of rarity, and new collectors may get taken on issues that turn out to be a lot less rare than first thought.

 

I owned a clad MS-67 1976-P Kennedy, and as you know, it is extremely rare. Made a tidy profit on it when sold. I also owned a nice MS-68 2000 Virginia state quarter that I took a $400 bath on when the pops exploded.

 

There does need to be more education in the area of moderns, and new collectors especially need to know that for more recent issues (current year material especially), they need to use caution and common sense until a truer idea of rarity can be established.

[cladking]

Roadrunner1; Yes. The coins that were popular when you started are still for the main part extremely common in unc or proof. This is BECAUSE there were huge numbers of people collecting and speculating in these coins. Many bags and rolls were set aside until the market crashed in 1964. Clad coins did not go into production until 1965. BECAUSE people had lost lots of money on moderns very few of the new coins were saved. This was hardly the only reason they were hated but they were certainly hated.

 

Since there was never any demand the scant supply was hardly even noticed. This demand is still small but is exploding and indications seem to be that it will not stop soon.

[cladking]

Keithdagen: I very much agree. Coins issued between 1965 and 1998 are in a totally different class than those issued later. This is not to say that the later coins are necessarily more prone to large price corrections or less collectable, simply that for he main part they have been saved in substantially higher numbers. This is the result of greater interest and greater demand so it isn't a bad thing just different. Due to the greater demand and greater supply the price swings can be more dramatic both upward and downward. People should understand coins are a luxury and an enjoyable pasttime not a means to an early retirement. While large profits can't be ruled out, it is not wise to bet the rent money on the latest high flyer.

 

And I agree that a friendly warning can be a good thing, but it often seems that his "friendly warning" is the only message we ever give to these new collectors and it often is far less than friendly.

 

 

[jtryka]

Clad,

 

Will you just drop it already?!?!? Fine, I was too mean to new collectors, you're right! And a thousand bucks for a really, really shiny $0.13 piece of copper and nickel is the bargain of the century! You win all right? I'm not going to post over in your little world ever again, so go back to your hall of modern worship and let us talk about coins here. You will be completely unfettered by me in your seemingly incessant desire to separate new collectors from their dollars, so have at it! And that should be a fantastic thing, since the single most dangerous thing for a market hypster is someone bold enough to speak against the party line.

 

I've been through this before, in 1999 and early 2000 when I was one of the few voices crying out in the wilderness against the internet stock bubble, and there were a lot of analysts and CEOs that treated me the same way you treat me now (and yes, I used far worse names with them than PCGS Monkeys and Modern ). But I am satisfied in the knowledge that my clients that heeded my warnings made more money than you can probably count be shorting these overpriced and overhyped stocks throughout 2000. To this day, I still get calls from portfolio managers, CFOs and CEOs every couple of months, reminding me of some of the things I said, and asking me what I think now. Well, I took a lot of heat at the time, and for the people that are now suing their brokers, we are about to embark on a fourth consecutive year of losses for the major averages, something that has only occurred once before in history. Well, the same thing can easily happen with this bubble, the only difference is that I am well paid for what I do in the equity markets, but this is a hobby for me, so I want it to be fun. And continuing to have a completely pointless argument with you is not fun, especially when I try to interject facts and objective ideas into the mix, and the best you can come up with is, "you're mean, you're driving away new collectors." I enjoy a good debate, but when all you do is employ logical fallacies (yours are mostly ad hominem), even that is no fun.

[Tradedollarnut]

So....what do you think now? Looks to me like a series of "9 life" cat bounces on the way to a low in the mid 6000 range. What say the expert?

[jtryka]

Well TDN, this is only my personal opinion and does not represent the views of my firm, and should not be taken as any form of advice or recommendation (after all, this is an internet message board and I could just be a 10 year old kid on his parents computer). The market has a lot going against it, not the least of which are current P/Es about double the historical lows normally reached in a secular bear market (which I also called in 2000, even though everyone else was calling it a correction, and then just a small bear market). That would suggest the potential for another 50% downside from current levels. That is strike one. The second strike is the dollar and foreign investment inflows which have supported both the stock, and especially the bond markets. Many foreign investors have experienced the double whammy of falling stock prices and a drop in the dollar (the poor europeans lost 20% on the dollar/euro exchange rate in addition to what they lost in the market). A loss of foreign inflows into the US equity markets could have even more damaging effects. The third strike is inflation. Yes I know Greenspan and his posse have been talking up deflation, but I think deflation is limited to the prices of computers and cars and other capital goods that folks like you and me just don't buy every week. Other areas like food, housing and energy have been rising and in some cases quite dramatically. Add to that the weak dollar (that may only get weaker with such low interest rates and decreased willingness of foreign investors to hold dollar denominated assets) coupled with the largest trade deficit in the history of the planet, it seems the prices of imported goods like TVs, DVD players and clothing are only going to rise (yes, I know China is a wildcard here). All of this smells like inflation to me, which is bad for stocks, increasing the equity risk premium and further depressing corporate profits if they have limited pricing power. All that said, I have very little confidence in the markets breaking the streak in 2003. This is not to say there aren't opportunities out there, I see many on both the long and short side, but that's a topic for discussion with my clients.

[cladking]

I actually like your reasoning in the financial markets and the posts you've made about the coins you collect. But continually calling moderns a bubble does not make it so. If I insulted you or anyone else or anything someone collects it was mostly inadvertant. ...and I apologize.

[EVillageProwler]

Ok, now that we kissed and made up, can we go back to arguing over raw vs slabbed or PCGS vs NGC or toned vs untoned?

 

 

EVP

 

[jtryka]

Ok, now that we kissed and made up, can we go back to arguing over raw vs slabbed or PCGS vs NGC or toned vs untoned?

 

I have neither kissed nor made up with anyone. I have simply moved on, and I absolutely encourage Clad to move on as well, I sure there are many threads about eBay auctions, grade results, and something called "pepperdoodles" that need his attention across the street.

[Tradedollarnut]

Anybody know where I can buy some raw MS68 trade dollars at MS64 prices?

[EVillageProwler]

Anybody know where I can buy some raw MS68 trade dollars at MS64 prices?

 

Yes. That same place also sells MS67 Seated Dollars at MS63 prices! And, the guy has an beautiful 1870-S specimen that he's pricing as a type coin.

 

And, now, I wake up!

 

 

EVP

 

[gmarguli]

Anybody know where I can buy some raw MS68 trade dollars at MS64 prices?

 

Yes. Contact CoinPete at BV Coins. They cut out the middle man, so they can offer you super prices.