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The strength of the market

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I read in many dealer's mailings and web sites that the coin market is HOT, HOT, HOT! I just read last night in DLRC's mailer that there is no end in sight for the ever increasing prices!

 

Last night's Queller Bust Halves sold for less than expected, although I don't know how much the '38-O and '39-O proofs went for.

 

Tonight, I heard from a friend that the coin I wanted -- the '46-O TD -- sold for $850 (hammer). The '53-O N/A sold for $140K. Cheap!

 

Where is the evidence that the market is so strong? JPMorganChase laid off 2000 employees several days ago, and reports a 91% earnings plunge. Goldman Sachs went through a massive bloodletting starting with last Friday and continuing at least through today.

 

Does this industry have any independent analysts? I am not questioning the ethics of folks like DLRC, but they can't possibly be independent!

 

EVP

 

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I think, overall, the market is cooling off. I guess it depends on what your market is though. As you stated above, too many people losing jobs. I know for me, that work is beginning to slow down also. Not a good sign of things to come for next year. I think the "money" that was going to hit the coin market from the stock market, has come and has started to end. Demand seems to be slowing down. Of course, different segments may be seeing different results. That's my gut.

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David Hall and PCGS are full of [!@#%^&^]. The market is not hot. It is dead. Top pop stuff is hot. Great toned coins are hot. Fresh QUALITY stuff is hot. Everything else is dead. DH/PCGS can pimp this stuff all they want, but you'd have to be blind to believe them.

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While I do think very ill of DH, I was actually referring to David Lawrence Rare Coins...

 

It is their flyer that was pumping up the market.

 

No insult to John and his merry crew, but I absolutely have to question the analysis of a market when they are also players in that market.

 

And, this isn't restricted to John's shop. This includes everyone, including Legend, Pinnacle and other board favorites. They're good and honest people, but their job is to make the market hot. Who's to say that these honest folks aren't blinded by wishful thinking?

 

EVP

 

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i totally agree with greg on what his thoughts on the market are!!!!!!!!!!!!!!!!!!!!!!!!!!! i think it is short correct!!! and to the point!!

 

sincerely michael

 

i also think these hot areas he mentioned are going to get better!!!!!!!!!!!!! and of course there atre many undervalued

sleepers but that is another thread

 

sincerely michael

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I have noticed some softness in the Auction Realized prices of both Heritage and B&M, particularly in Gold Type. I have been buying at close to Gray Sheet (or less) in auctions. I do not see any coin prices on EBay that indicate a strong coin market.

 

IMHO, I think that the Bearish stock market is still not done. The strong selloff (covering short stock) which usually signals a turning market has not happened. I certainly could be wrong, but I don't think this Bear Market is through quite yet. confused.gif

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I just put a lot of money (for me) into a coin, part of the equation was that the money couldn't do any worse in the stock market.

 

I don't perceive that the overall coin market is advancing that much. I think when you see all the dealer hype it just means that that particular dealer is really busy and maybe recently closed a few nice deals, or maybe picked up some new clients with lotsa extra cash and a scratch to itch.

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Last night I read the latest CDN (greysheet) and they indicate that the market is equivocal with some dealers struggling pretty hard and others doing well. My personal feeling is that it is cooling off. Part of the reason for that is that many investment market analysts are currently speaking out against the great shifts in investment interests and that it could spell trouble for some who have switched from one investment vehicle to another in recent times. I think that those investors who may have been leaping at coins are now pulling back. This leaves the current long-term collectors supporting the vast majority of the market. There is still a bit of a surge for pop-top material in the moderns, particularly from the influx of new collectors due to the state quarters program. This latter population, however, does not support the strong arm of the collector's market. They are clueless, for example, about classic rarities that EVP mentioned. This group may have some influence on some more modern series, e.g. buffalo nickels, but even those appear to be slowing overall somewhat. Certain series always have a collector's appeal, e.g. Walking Liberty halves, but the top-end in those coins are still going to the serious collectors, not the general market.

 

Just some thoughts, Hoot

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EVP ,

 

While I agree with a lot of what you said, please look at this article which appears on our website. Hopefully you will agree that we at least try to be objective and not constantly pump things up like some do.

 

ARTICLE:

 

Overhyped Hype?

 

While the talk in the industry is of a booming market, we're still seeing a very two-tiered environment out there. Many coins are not selling for prices any higher than they were a year or two ago. (Although we admit that most everything is easier to sell.) The "crazy" prices are being paid for a relatively select group. These mainly consist of low population pieces that fit into the "Registry program." Of course, two other hot areas are gorgeously toned silver commems and the 1936-42 proof material we've written about before. But in reality, many areas have not seen much price pressure, and there are still numerous bargains to be found. Dated Twentieth Century gold, almost all mintstate silver type (especially Seated and Barber material), silver commemoratives that do not have spectacular color, proof nickel coinage and Peace Dollars are all still available at very reasonable levels.

 

We are not trying to take the wind out of the sails of those touting this as a hot market. In many ways it is. But we want to point out that this Bull market, if that's what it is, is still in its infancy. For those who are adding to your collections now, this is a good thing, especially if you're targeting coins that are currently out of the spotlight.

 

 

 

 

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My apologies to Mark Feld and to everyone for my poor choice of words...

 

I meant that I had only read DL's flyer, and that we should be more critical of the market analyses from all dealers -- including Legend, Pinnacle, etc.

 

In other words, I'm not saying that firms like Pinnacle are over-hyping. Rather, I'm saying that there's really no independent market analysis organ for this industry. As such, we need to be very careful when reading about the game from those who play in the game.

 

I follow very closely the market for the series in which I specialize. I view the market as being very fickle, and increasingly depressed. The Early Dollars are doing well enough, but the super rare varieties are not. The other series that I follow are really just treading water...

 

EVP

 

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There are huge numbers of new collectors comng around. The problem is that most of these people do not buy many coins at a premium to face value. They mostly buy folders, and albums, and the occasional state quarter they missed. They might buy a current mint or proof set from the mint, but most still aren't even going back to collect the older coins in circulation yet. Some of these new collectors have already branched out to other areas; mostly 20th century coins and moderns. The hobby still does little to encourage them. While this will sound self serving, it seems the way to get the most of these people to expand their collecting into the older coins is to provide a "bridge" with the eagle reverse clad quarters. There is less difference between a 1998 quarter and a 1999 quarter than any other coin. It isn't a stretch for a newbie to expand his collection back to 1965. From there many will want to go all the way back to 1932 and there'll be no stopping them once they get used to the idea of paying more than face value for a coin. It's not that we've been collectively pushing these people away, just that we've not been embracing them and surely not capitalizing on all of our opportunities.

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There are certainly parts of the market that are very strong, by any historical standards;registry coins, high grade lincoln cents and Indian Head Cents. The FUN show should continue to cause excitement in high grade IHC's, the 56 flyer is a knockout as are several other of the cents up for sale in that collection.

 

Small coin shows are achieving large attendance all over the country. The one I attend on a monthly basis has grown unbelievably the past two years and there is a lot of buying.These collectors may not be shelling out 2 grand or 40 grand at a pop, but they surely are buying and collecting, maybe its volume over quality, but so what. I don't follow many series, but the ones I do are hot.

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I also have been deflecting money into Gold sets instead of the market. I still have a 401k account with some Mutual Funds that I carefully selected and discussed with my Broker. These funds have declined 10% in the first Quarter and 10% in the second Quarter. I stayed in the market too long last year and lost mid-5 $ figures.

 

I can not afford these loses. I am on Retirement Disability, with Emphysema and Pulmonary Hypertension (my Tricuspid valve is blown and leaks like hell!!). I need to quit listening to my Broker. Every dollar that I loose is one that comes out of my retirement. Except for the one small 401k account, I do not own any equities. This market is strictly wait and see. tongue.gif

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While I do think very ill of DH, I was actually referring to David Lawrence Rare Coins...

 

Oops. I probably just got done reading a PCGS article about how the market is on fire.

 

Any dealer that says the market is hot, I want to sell them some generic stuff. No dogs, just generic stuff. I also want "hot market" prices for them.

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Boiler good question. I have been pondering that one too. My gut tells me $110,000 to $115,000. My coin collecting sense tells me that is too much. This one is a tough one to call. Shylock posted a picture of it on his web site and the other forum.

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The 1846-0 TD half sold for $3335 at Queller. The $850 previously reported was for a regular BU 46-0 medium date. Both coins sold to dealers. The 46-0 tall date brought 67% of UNC money so that was not too shabby. After sitting through

3 hours of constant bidding I only managed to buy 7 lots. I was hoping to spend

5 to 10x as much. Competition was fierce. There were no signs of a weak market here. The 38-0 was dark with below average eye appeal. It still brought plenty. Some of the MS63-65 bust type I bid on went for 2 to 3x higher.

 

roadrunner

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My experience as a dealer is that if you have really nice, attractive material, you can sell it to other dealers for more that the Gray Sheet prices. Right now things are slow at the shows when it comes to selling to average collectors. They don't seem to be buying or looking at most run of the mill stuff; and they have trouble grasping the concept that the really nice coins are selling for premium prices.

 

From my vantage point the hottest areas of the market are nice early coins (1792 to the 1820s no problem Mint State throught the circulated grades), CC Morgan Dollars, Choice to Gem Proofs coins from 1936 to 1942 and ;newbie items like 1999 and 2001 silver Proof sets. The quiet areas include most other Morgan Dollars, late date Mercury Dimes and Walking Liberty haves and 19th and early 20th century type coins in MS-63 and 64.

 

 

Appolgies for the weid symbols. I can't remove them from this post.

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Bill, I heard the same thing from the dealers at the show I went to Saturday. Buyers were there with their sheets and the dealers were just laughing at them, None of them were selling their nice coins off of sheet. It also seemed you couldn't give away mint state walkers.

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