Saint Question

[GoldFinger1969]

I know the jump in price between a 62 and a 65 can seem like a lot, but as a collector (rather than just a stacker of bullion) I would recommend digging a little deeper and paying for the 65. I have yet to regret that I paid an extra $500 to get a better coin, but there are certainly coins in my set that I look at and wish I had spent the extra $500 or so to get a better example.That's not to say you need to chase the number on the plastic. I say that because I have some 64s that I thought looked better than the more expensive 65s in the dealer's case. The 65s will sell better, but I was looking at the coin, not the number.

 

I know, but the jump for the 1914-D is in the vicinity of 100% or more and the 1911-S I am being quoted is 200% or more. It's not an extra $500 !!

 

A few hundred, I can swing...but not a few thousand.

 

Now...if I am right on my 6 Lotto numbers for Wednesday evening....

[GoldFinger1969]

Question: Would you guys pull the trigger on either a legit MS62 1911-S or 1914-D for $1,500 ?

[CSdot]

The jump on the 1911S is steep. I had a line on one in MS65 for $3,800 once, but missed it.

[jpcienkus]

Question: Would you guys pull the trigger on either a legit MS62 1911-S or 1914-D for $1,500 ?

 

In general, yes. I'd want to see pictures or in-hand.

[GoldFinger1969]

JPC, CS.......if the price is about the same (say within $100)....which would you get now if this would be my last Saint for a while.....knowing that if I am in a position to move to MS 65 on either/both in the future, the cost for the 1911-S would be much more (~ $5,000) compared to the 1914-D (~$3,000).

 

BTW, I know that at very low grades both trade close to melt/bullion....but isn't it strange that at MS 62 they are so close in value but at MS 65 they gap out ?

 

Wouldn't you expect more of a gap, even narrower than at MS 65, at the MS 62 level ?

 

Is this normal for Saints, other gold coins, or other non-golds ?

[jpcienkus]

JPC, CS.......if the price is about the same (say within $100)....which would you get now if this would be my last Saint for a while.....knowing that if I am in a position to move to MS 65 on either/both in the future, the cost for the 1911-S would be much more (~ $5,000) compared to the 1914-D (~$3,000).

 

BTW, I know that at very low grades both trade close to melt/bullion....but isn't it strange that at MS 62 they are so close in value but at MS 65 they gap out ?

 

Wouldn't you expect more of a gap, even narrower than at MS 65, at the MS 62 level ?

 

Is this normal for Saints, other gold coins, or other non-golds ?

 

I would get the one that in-hand, appeals to me most. Take Bill Jones comments from the other thread, apply them to each coin and pick the one that in your eye is better. For these two dates/mint marks and grade, I wouldn't be concerned about which one is the "better deal". I'd be concerned with getting the nicest looking coin. You'll never go wrong buying the coin that appeals to you and will likely be more marketable if you ever go to sell it. Experienced collectors buy the coin.

 

I wouldn't say that the pricing behaviour of each coin is strange. What you are seeing is a good example of condition rarity or supply and demand. At that grade one coin likely has a higher supply, thus the lower price. I am surmising here and have not done the actual research. In my limited experience, it's normal for all series. I've primarily been a Morgan collector. I went through and identified which grade, by date and mintmark, I could add to my collection The determining factor was price. There were some instances that a MS64 sold for the ~$600 range, but the MS65 jumped to ~$3000. So which do you add? IMO, I wait for a great example of the MS64, based on my budget and what I'm willing to spend on the series.

 

I hope that helps. I'm still learning this hobby and have enjoyed educating myself by reading the posts of the very experienced collectors on this site.

[jom]

BTW, I know that at very low grades both trade close to melt/bullion....but isn't it strange that at MS 62 they are so close in value but at MS 65 they gap out ?

 

Wouldn't you expect more of a gap, even narrower than at MS 65, at the MS 62 level ?

 

Is this normal for Saints, other gold coins, or other non-golds ?

 

That's called condition rarity. Often if the coin is not found too often above, say, MS65 the price starts to increase exponentially. It is not unusual for Saints or Walkers or SLQs or many other issues.

 

Each coin series has certain dates (and mint) that will inevitably have these anomalies that occur probably due to the mint at the time of manufacture.

 

jom

[GoldFinger1969]

I would get the one that in-hand, appeals to me most. Take Bill Jones comments from the other thread, apply them to each coin and pick the one that in your eye is better. For these two dates/mint marks and grade, I wouldn't be concerned about which one is the "better deal". I'd be concerned with getting the nicest looking coin. You'll never go wrong buying the coin that appeals to you and will likely be more marketable if you ever go to sell it. Experienced collectors buy the coin.

 

Good point, I've been trying to buy 'the best value' or the coin that will fill the gap NOW and save me down the line. For all I know, I will win Lotto and cost of MS 65's won't be an issue in the future.

 

I wouldn't say that the pricing behaviour of each coin is strange. What you are seeing is a good example of condition rarity or supply and demand. At that grade one coin likely has a higher supply, thus the lower price. I am surmising here and have not done the actual research. In my limited experience, it's normal for all series. I've primarily been a Morgan collector. I went through and identified which grade, by date and mintmark, I could add to my collection The determining factor was price. There were some instances that a MS64 sold for the ~$600 range, but the MS65 jumped to ~$3000. So which do you add? IMO, I wait for a great example of the MS64, based on my budget and what I'm willing to spend on the series.

 

Good strategy, and yeah, that's some jump for a 1 grade move. I see that in the Saint series, but usually above MS 65 or 66.

 

I hope that helps. I'm still learning this hobby and have enjoyed educating myself by reading the posts of the very experienced collectors on this site.

 

Yes, I have been doing that for a few weeks now....and tons of articles from the relevant coin sites, some leading to other articles, etc. etc. etc.

[GoldFinger1969]

BTW, I know that at very low grades both trade close to melt/bullion....but isn't it strange that at MS 62 they are so close in value but at MS 65 they gap out ? Wouldn't you expect more of a gap, even narrower than at MS 65, at the MS 62 level ? Is this normal for Saints, other gold coins, or other non-golds ?

That's called condition rarity. Often if the coin is not found too often above, say, MS65 the price starts to increase exponentially. It is not unusual for Saints or Walkers or SLQs or many other issues.Each coin series has certain dates (and mint) that will inevitably have these anomalies that occur probably due to the mint at the time of manufacture.jom

 

Thanks Jom...makes sense....I keep trying to apply linear relationships from the world of finance where my experience and depth is much stronger.

[jom]

GF69: After reading a few of your posts it seems to me you are trying to place coins into "bins" in terms of their grade. Experienced collectors look at the SPECIFIC coin to find out whether they like it and use the grade as a STARTING point to determine value. No two coins are exactly alike...unless it some MS70 modern proof or some such.

 

Another words not every MS65 Saint is worth the same nor should they be. You have to look at the piece and decide whether you LIKE it first...then go from there. To me it's a waste of time trying to figure out a grade of the coin if you don't like it. I mean, other than educational purposes, who cares what the grade is if the coin isn't something you want?

 

jom

[CSdot]

Since the 1911S is so expensive in MS65, maybe get it in MS62, then pick up the 1914D in MS65 for $3,000 later.

[GoldFinger1969]

GF69: After reading a few of your posts it seems to me you are trying to place coins into "bins" in terms of their grade. Experienced collectors look at the SPECIFIC coin to find out whether they like it and use the grade as a STARTING point to determine value. No two coins are exactly alike...unless it some MS70 modern proof or some such. Another words not every MS65 Saint is worth the same nor should they be. You have to look at the piece and decide whether you LIKE it first...then go from there. To me it's a waste of time trying to figure out a grade of the coin if you don't like it. I mean, other than educational purposes, who cares what the grade is if the coin isn't something you want? jom

 

Agreed...but what about when you see a coin that is rated MS 62 and it's appreciably LESS than what you see other MS 62's going for ?

 

Instead of pouncing, I am thinking that something is wrong (even though it's already been rated by a TPG) with the coin.

[GoldFinger1969]

Since the 1911S is so expensive in MS65, maybe get it in MS62, then pick up the 1914D in MS65 for $3,000 later.

 

That's what I am thinking...going to go to the dealer tomorrow and check them both out (it snowed today). As I recall, one of the coins -- I can't recall which -- had a somewhat noticeable white mark or dot or something on the reverse. I can't remember which coin.

 

So the fact it was still an MS 62 leads me to believe either (1) it's something that a pro doesn't care about in grading (though I do eye-wise) or (2) the coin, sans that mark, would have been 1-3 grades higher.

 

So I'll look at them both again and decide. I'm leaning towards the 1911-S so hopefully it's the 1914 that had the noticeable mark on the reverse.

[CSdot]

Gold finger,

 

Picked up another double eagle today. Not a Saint, but a nice looking 1893S in a MS62 PCGS holder. I would swear it is Prooflike. I am tempted to resubmit it to see if it will earn the PL designation. Anyone know the criteria the TPGs look for, beyond mirrored fields?

 

Anyway, I was picking up a 1902S $10 Liberty and the 1893S $20 caught my eye. Guess I was in the right mood, and the price was just a little over spot, so I bought it.

 

I'll try to get some photos up this weekend.

[GoldFinger1969]

Congrats, CS....where'd you pick up the coin ?

 

Looking forward to the pictures.....hope to be able to join you in Liberty-hunting one of these days.

[CSdot]

I have gotten to know the managers of a local branch of a national bullion dealer. They know I like gold coins so they regularly ask their other branches to send pre-1933 gold and high level classic coins to my city so I can review. I bet I've seen a good percentage of the collectible coins that their national bullion business has purchased from gold and silver sellers. We've been doing it for years and it has been one of my best sources of coins.

[GoldFinger1969]

Saint Colors: Check out this coin...what causes this bright-yellow appearance compared to the dirty orange that I see for most Saints ?

 

http://www.ebay.com/itm/1911-PCGS-MS-62-Saint-Gauden/221360414839?_trksid=p2050601.m2372&_trkparms=aid%3D111000%26algo%3DREC.CURRENT%26ao%3D1%26asc%3D207%26meid%3D4471889458967589097%26pid%3D100085%26prg%3D1112%26rk%3D3%26rkt%3D4%26sd%3D131100305092%26%26clkid%3D4471890381852817953&_qi=RTM1562571

[GoldFinger1969]

Saint Numismatic Premiums:

 

Saw a chart from a friend (he's going to try and send it to me and I'll upload it), but the gist of it was showing the premium (I would assume for common Saint Gaudens) MS65 coints.

 

Key Observations:

 

(1) The premiums were 500 - 1,000% during the late-1970's through early-1980's. This was when gold was ramping (at least until 1980) and traded for anywhere from $300 - $800/oz.

 

(2) When coins popped along with other collectibles (any reason why? I know why baseball cards did, surprised coins suffered as much as they did) the premiums collapsed in 1990. During the 1990's the premiums were 150-250% for MS65's, give-or-take.

 

(3) In the 2000's.....as gold started to soar the premium began to fall in 2004. At the height of the Credit Crisis (2008-09) the premium fell to about 50%. It rose to 75% or so by 2010 and has once again been falling to the current level once again of about 50%, give-or-take.

 

Not sure what some of you veterans think or some of you folks in the business like MF, but I think buying SG's at the current price is a pretty good deal relative to bullion.

[jpcienkus]

Saint Colors: Check out this coin...what causes this bright-yellow appearance compared to the dirty orange that I see for most Saints ?

 

http://www.ebay.com/itm/1911-PCGS-MS-62-Saint-Gauden/221360414839?_trksid=p2050601.m2372&_trkparms=aid%3D111000%26algo%3DREC.CURRENT%26ao%3D1%26asc%3D207%26meid%3D4471889458967589097%26pid%3D100085%26prg%3D1112%26rk%3D3%26rkt%3D4%26sd%3D131100305092%26%26clkid%3D4471890381852817953&_qi=RTM1562571

 

Juiced photos.

 

Edited to Add: All the gold coins he has photographed look very unnatural to me. On my PC screen at home they almost look lemon yellow.

[CSdot]

Just saw your post with the 1911 Saint from the other day. That eBay seller's Saints catch my eye whenever he posts something new. Either he only gets Saints with that great gold coloring, or more likely the coloring has something to do with his photography and lighting skills.

 

When I first started out I asked that same exact question to the owner of one of the local coin shops in town who held himself out as havering decades of experience grading coins for PCGS. I even showed him some examples of what I was looking for on eBay (likely showing him a Saint on my iPad from that same eBay dealer). I expected to learn that it had something to do years of exposure to chemicals coming from the bank issued bag it was stored in, or maybe something to do with the rinse used by the Mint on the Planchets prior to striking. Unfortunately I do not remember getting a decent answer, but rather some BS like "you never know why gold coins look different from one another." I eventually gave up on the idea of learning anything useful from that dealer.

 

[GoldFinger1969]

Juiced photos....Edited to Add: All the gold coins he has photographed look very unnatural to me. On my PC screen at home they almost look lemon yellow.

 

Ditto....if I bought a coin like that and it didn't look like the pics I'd probably return it. In this case, the MS 66 rating seems legit even if the color has been manipulated in the photos.

 

Gold does have different colors, though, as others have noted here. But that lemon-yellow color really does seem Photoshopped or something.

[RWB]

The normal color of 20th century US gold is orange-yellow. A coin that has been acid dipped several times will tend to look more yellow due to removal of copper from the surface....of course, that will also dull or remove luster.

[Nutmeg Coin]

Gold finger,

 

Picked up another double eagle today. Not a Saint, but a nice looking 1893S in a MS62 PCGS holder. I would swear it is Prooflike. I am tempted to resubmit it to see if it will earn the PL designation. Anyone know the criteria the TPGs look for, beyond mirrored fields?

 

Anyway, I was picking up a 1902S $10 Liberty and the 1893S $20 caught my eye. Guess I was in the right mood, and the price was just a little over spot, so I bought it.

 

I'll try to get some photos up this weekend.

 

A little secret; PCGS will not PL $20 gold coins, NGC will if they think the coin warrants it. It is not to the advantage of dealers to educate customers on this, if you get a PL on that coin it will add many hundreds of $$ in value. One of this state's major dealers makes no bones about "helping" customers, they never helped me get coins certified so I had to open my own account many years ago.

[CSdot]

Nutmeg,

 

That is good information to know. Thanks.

[GoldFinger1969]

Sent by a friend, it looks pretty accurate:

 

 

 

Not sure why I can't make it bigger, I resized it but it's the same size as the original....the premiums range from 4x gold price in 1999......about 3x for most of the 2000 - 2007......a spike up to 3+ during the Credit Crisis...and a recent low just under 1.5x about 2 years ago.

Based on this chart, relative to gold, MS-65 Saints are pretty cheap.

 

[GoldFinger1969]

Some More Interesting Charts: Some people privately messaged me about some of the charts, I had this in my folder from somewhere on the internet (click on the charts to make them larger):

 

 

I would add that it is NOT strange that the premiums on many coins that ran-up during the Bubble Years or during the 1970's took so long to dissipate. We see this on many financial assets that undergo huge increases and/or bubble behavior:

 

(1) During the 1970's, the price of gold went up 20-fold. Plus you had pent-up demand since gold wasn't allowed to be legally owned until 1974. Nobody knew what the proper price of gold bullion was, and nobody knew what the 'right price' was for a gold coin with numismatic value.

 

(2) During the 1980's, the price of the Saints maintained a rich premium to the underlying gold content, when gold itself lost 1/2 its value for most of the decade. Saints exploded in 1989 for reasons outlined in my COIN BUBBLE thread.

 

(3) In the 1990's, despite a couple of head-fakes (1990 and 1994), gold was pretty much flat-to-down. As time went on, the 'sticky' premiums on Saints gradually came down to the 300-500% range to underlying gold content for MS-65 graded Saints.

 

(4) In the 2000's, despite gold going up 4-to-6 fold, the premiums on Saints continued to disappear as more coins came to market and earlier buyers threw in the towel.

[GoldFinger1969]

Looking at the chart above, and taking into account what the President of HA said in mid-2011 about Saints being 'cheap' at the time, it really is a bi-furcated market: Saints were the better investment when the premium was HIGH because that meant that the absolute price of gold was LOW. When the premium fell to 50-100% in 2011, it was actually a time to SELL.

 

Given the hybrid numismatic/bullion valuation of the coins, it reminds me of cyclical stocks which you buy when their P/E ratio is sky-high (at the depths of a recession) and sell when the P/E is low (when things are booming), contrary to what you do with most stocks.