DMPL's, CC's, and High Grade Common Date Morgans, Be Careful!

[dragon]

I've been a fairly serious collector of DMPL, PL, and high grade Morgans for quite a few years now, primarily in DMPL Carson City common dates and high grade common date -S- mints, and I would strongly caution anyone looking to collect/invest in many of these coins at current price levels for the following reasons:

 

 

 

1) Prices have moved up too fast to quickly on many of these coins, especially some of the semi-key date CC's in high grade, common date CC's in DMPL, and high grade -S- mints. Many of these coins have doubled or tripled in value within the past 18 months or so, they exist in the multi thousands for many common -S- mints and DMPL CC's, and generally anytime something spikes in price so much so quickly, it turns out not to be neither sustainable nor a good long term value....... whether it be a stock price, a collectable, or otherwise.

 

2) Again, many of the common date CC's in DMPL exist in multi thousand certified quantities, yet have risen in price in a dramatic way recently. This in my opinion is not the result of normal market demand but rather the hoarding and subsequent price manipulation of a few selected dealers/collectors/investors......and when they decide the time is right to sell, prices for these coins can literally fall off a cliff in short order.

 

3) Because of the dramatic price spike for many CC and high grade common dates, even very marginal certified coins now bring very strong prices in the marketplace. This is double jeopardy in my opinion as some of the coins are very weak for the stated certified grade and the buyer at these levels takes on two distinct risks, the market risk, and the 'plastic' risk. When the market comes back down, the low end coins will trade at a significant discount to even the new lowered prices.

 

4) Some dealers now appear to now be setting their own higher and higher price levels on many of the coins I speak of based on their lack of wide availability and their own opinions of the marketplace, as well as the individual coins quality. Many of the current pricies appear to be more hype and promotion than reality or rarity or desirability, and this has always been a danger sign of unsustainable high prices in the past in my experience.

 

While it's now common knowledge that the internet and set registries has created a whole new marketplace, I do not believe there is truly anywhere near the widespread collector demand to justify the skyrocketing pricing on many CC's, DMPL's, and super grade common date Morgans, but is rather the result of massive hoarding and speculating by a relatively small group of individuals. If true, these very high prices can free fall in a matter of weeks when positions are liquidated, leaving the casual collector with massive paper losses on his coins.

 

While I still continue to hold quite a few of the coins I speak of that I've owned for many years because of their personal collector appeal to me, I have also sold quite a few into this market, and would be extremely cautious in buying any more at these new inflated price levels. Then again, I remember the internet stock craze, the precious metals markets in the late 70's, the coin market of 1988-89, etc.

 

 

Just my .02 and personal views on the current marketplace for DMPL's, CC's, and high grade common date dollars.

 

dragon

[EVillageProwler]

This observation isn't restricted to Morgans ... unfortunately. Note the price history of ED's in the past 3 years.

 

EVP

[Hoot]

Great observations, dragon. I'd also include brilliant proof buffalo nickels (1936 and 37) in your scenario. Two years ago you could buy wonderfully toned PF67 pieces for less than 2 grand (I almost did, but got cold feet). Now I regret not doing so, as you can't touch those pieces for less than 3 grand in those superlative conditions. Good to be cautious upon observing such rapid inflation.

 

Hoot

[bigd5]

The one note I would make with your post Dragon is that PL and DMPL Morgans were, or were/seemed to me, undervalued for quite a long time.

 

With those coins, I think there was a bit of "catch up" that went into effect, although I agree with the price jumps on the common coins. ms/65 and 66 coins have really jumped, and it's tough to swallow that outstanding demand is the reason, and that that demand can continue.

 

Ditto EVP.

[michael]

you hit the nail on the head dragon

 

the dealer retail selling prices are great

 

but when it comes to dealer buying prices

 

the dealer buying prices offered are not that great as it would seem in a so called hot dmpl market

 

and the market seems to be thin when it comes to dealers buying them for great buying prices if they make an offer at all

 

 

and hoot i see your point with the proof buffs 36 and 37 brilliant coins and it is well taken and you are absolutely correct

 

 

but true exceptional colored satin proof buffs 1936 that are your above average colors to me are still undervalued

 

the average colored purple gold yellow blue proof 1936 satin and brill and 1937 proof buffs even if higher grade proof 66 67 are to me nothing special

 

 

michael

[TomB]

Terrific post, dragon, and very good responses by everyone else involved.

 

I'd like to add that anyone who is seriously considering entering a market such as DMPL and CC dollars should, from a very early stage, offer one or two of these coins around to the major sellers of them. Do this in order to better gauge the after market for the coins once they are in your possession.

 

The coins previously mentioned, such as select EDs and brilliant Buffalo nickels, have seen relatively large and quick price jumps in recent years, as have 1936-1942 proof Lincolns in RD and Washington quarters. Of that group, I believe that the EDs had been the most undervalued, that attractive Buffalos were more scarce than their levels indicated and that the State Quarter series made many Washington quarters too expensive relative to their true scarcity. The RD proof Lincoln cents of 1936-1942, however, seem to be the issue on the thinnest ice.

 

Coins that appreciate steadily, without hype, are fairly easy to sell to dealers and that are still difficult to find are the best pieces to buy, in my opinion.

[michael]

really great response tom!

 

you really know how to put things in words

 

with regards to your comments on the red proof lincoln cents 1936 to 1942

 

you are correct

 

now in regards to neatly colored gem proof 36 to 42 lincoln cents in red brown and brown these are actually more beautiful and rarer than their red counterparts!!

 

in fact when these like any other copper proofs tone usually they are spotty and/or streaky and to get a good even color along with great eye appeal in gem and with little to no spots and flecks is actually totally undervalued and underappreciated sleeper coin

 

say for example if you get a late date such as a 1942 proof cent that is gem proof red brown say with fire engine red

toning with rainbow highlighte on the rims AND NO major spots in the focal areas

now this is really rarer and more eye appealing than any gem red coin!! and in reality SHOULD BE WORTH MORE THAN THE SAME date in gem red proof!

 

 

michael

[jom]

now in regards to neatly colored gem proof 36 to 42 lincoln cents in red brown and brown these are actually more beautiful and rarer than their red counterparts!!

 

I'm not a big fan of proof coins for the most part but I do very much agree with your statement about RD vs RB. Many RB coins are just prettier, IMO. And if I ever started a collection that would be the niche I'd work in without a doubt. Just like my avoidance of most FH, FB etc coins and avoid most of the RD pieces just because of the premium you'd have to pay. Designations like that just turn me off I guess....

 

jom

[EVillageProwler]

IMO, it's not what's written on the inserts that matter most. To me, what matters most is ... ...

 

EYE APPEAL, EYE APPEAL, AND EYE APPEAL.

 

Vividly colorful RB and BN coppers are cool as all heck, and tough to find!

 

EVP

[michael]

I'm not a big fan of proof coins for the most part but I do very much agree with your statement about RD vs RB. Many RB coins are just prettier, IMO. And if I ever started a collection that would be the niche I'd work in without a doubt. Just like my avoidance of most FH, FB etc coins and avoid most of the RD pieces just because of the premium you'd have to pay. Designations like that just turn me off I guess....

 

jom

 

++++++++++++++++++++++++++++++++++++++++++++++++++++++

 

 

 

IMO, it's not what's written on the inserts that matter most. To me, what matters most is ... ...

 

EYE APPEAL, EYE APPEAL, AND EYE APPEAL.

 

Vividly colorful RB and BN coppers are cool as all heck, and tough to find!

 

EVP

 

++++++++++++++++++++++++++++++++++++++++++++++++++++

 

 

 

 

 

michael

[michael]

okie let me give you a real example and you choose which coin you would take

 

 

both coins are in ngc proof65 holders 1942 lincoln cent

 

one is ngc pf 65 red the other ngc pf 65 red brown

 

 

 

both are really nice for the grade too proof 65+ coins

 

the red coin is a nice full red coin even colored both sides original slightly mellowed red an above average eye appeal coin

 

the red brown coin is really exceptional in eye appeal it is toned fire engine red/magenta on the obverse and even color

 

the reverse is fire engine red/magenta toned with some mint original red intermingled and rainbow highlighted toning around both wheat stalks

 

 

now both coins are priced at the SAME price

 

which one would you choose to buy if you had to pick one or the other?? and why??

 

 

michael

[Bruceswar]

All the information here is good... and as to Micheals deal ...I would prolly take the RB one depending on how it looked in person....

[TomB]

Well, I think you know where I'm going with this answer, Michael. For me, it would be an instant decision to buy the RB coin. Under the scenario that you have outlined, this would be an instantaneous commitment to the coin with the greater, in my opinion, eye appeal. Not only that, but if you were to look for a coin to match either of these described pieces, you would much more likely be able to match the RD coin and not approximate the RB piece.

[michael]

bruce and tomb you hit the nail right on the head

 

tomb you sum it up extremely well

michael