No One Has Mentioned It Yet, So I Will.....

[Elcontador]

I have never seen so much expensive material being offered at one time ever before.

I am referring to the Heritage, Bowers, ANR (what used to be Bowers), and Superior auctions going on in conjunction with the A.N.A. You name it, it's there, and plentiful.

 

I spoke with a few people involved, and it seems that some estates are being sold, coupled with some long time collectors who feel now is the time to sell. I'm sure many of these coins have been off of the market for years, if not decades.

 

It will be interesting to see what prices these coins bring / how such an enormous volume of high end coins will be absorbed by the numismatists and the market.

I mean, how many people out there want to purchase 1794 Large Cents or PF 67 Barber Halves? I could go on and on, but will try to be brief.

 

Another thing that will be interesting will be to see what happens when dealers have to pay for the auctions lots they've won, 30 to 45 days out.

 

With the possible exception of "finest known" material for the Registry Set people (for many of them, price does not seem to be a concern), I see too many quality coins to be absorbed & at some point in the not too distant future, prices will dip.

 

Your comments?

[Oldtrader3]

I tend to agree that these volumes and prices may be more than the market can absorb at one time. As usual, CEO's trying to generate the higher revenue curve with out decent research or market testing. All driven by their superanneated egos. DQB seemed to be more prudent about judging and testing market elasticity. IMHO, DH (the Great One) doesn't understand the concept!

[291fifth]

This may be a true test of how strong ,or weak, the coin market is at present. My gut feeling is that there will be many soft spots evident in these sales.

[MarkFeld]

I have witnessed many occasions where huge volumes and values of coins have been auctioned off within a short time span. In virtually every case, the market has found a way to absorb it, without a noticeable change in prices. This has been the case in good markets and in bad ones.

 

People almost always seem to find a way to come up with the money. Sure, some coins will slip through the cracks and bring disappointing prices. But, I would bet that more, will sell at extremely impressive levels.

 

That said, as is sometimes the case in these situations, I wouldn't be surprised if some dealers are looking to raise cash, 30 to 60 days after the auctions take place.

 

...As usual, CEO's trying to generate the higher revenue curve with out decent research or market testing. All driven by their superanneated egos. DQB seemed to be more prudent about judging and testing market elasticity. IMHO, DH (the Great One) doesn't understand the concept!

 

Oldtrader3, sorry, but your above quote doesn't make much sense to me. This is typically the time of year when major sales are held - the only difference I see, is that there might be 4 major sales instead of 3, due to the addition of American Numismatic Rarities on the scene. It has little or nothing to do with egos - it's simply good business to hold auctions during an active time of the year and in the midst of a strong market.

 

And, your insulting DH is unfounded and unfair in this instance. His auction company is the ONLY one of the 4 holding auctions, which has the official ANA sale. Should they not hold it, because other companies choose to conduct sales around the ANA?

 

[Oldtrader3]

I am just afraid that prices will not hold in the face of large auctions (i.e. Heritage-6000 lots, B&M-7700 coin lots, Amer. Num. Rarities-2100 lots, Superior-1200 lots). That is an astronomical amount of better quality material to move in a few days.

 

Actually, I sincerely hope that all the auctions are successful and they pull it off. If these auctions do not produce strong buyers and they exceed the market demand, we all suffer together in a weaker market with lower prices. Certainly this ANA Convention will test the Price Elasticity of the coin market.

 

I should not have singled DH out, any more than the other companies involved. I just hope that they have correctly assessed demand. The dealers have the power to limit auction materials (certainly on the up side, more than the down side). If the major dealers believe that the market will not support higher sales, they then have to exercise the discipline to throttle back.

 

The main point that I was trying to make is that there is no COMEX for coin collecting. The various indices that the industry has used in the past are not source verified and are somewhat suspect. We do not know even how many coin collectors there are out there. Let alone their yearly spending patterns.

 

We have auction history (looking into a rear-view mirror) without regression analysis. The industry is flying blindly forward into the night with little data. There is auction data available to measure coin market demand and pricing for that segment. I know that it costs money to do these analysis, but maybe in a market this size, it is time for some analytical work. Many tens-of-millions of $'s are at risk.

[MarkFeld]

Oldtrader3 - thanks for the clarification.

[keithdagen]

I am just afraid that prices will not hold in the face of large auctions (i.e. Heritage-6000 lots, B&M-7700 coin lots, Amer. Num. Rarities-2100 lots, Superior-1200 lots). That is an astronomical amount of better quality material to move in a few days.

 

Add another 5,000 lots for Heritage's Bullet Sale -- I viewed about 30 of the Signature lots on Friday -- lot of good stuff being auctioned.

[cladking]

Auction houses do not have an unlimited ability to throttle back on what they sell. They can certainly influence it by encouraging clients to hold or sell but beyond this they are simply throwing away money by holding back. Potential sellers will just sell elsewhere if an auction company refuses their business.

[pmh1nic]

I've been curious about where the point of saturation is (volume/dollar wise) in the coin industry/hobby. That interest was really stirred when the SSCA coins came to market. I had a very strong "feeling" that it was too many coins of one type at what I thought was outside the budget of most collectors to be absorbed by the marketplace at one time. Two years later I'm still getting calls from Monico trying to sell me one.

 

Now if I had Bill Gates money there would be no problem providing a home for a lot of the really "nice stuff." Unfortunately pmh1nic money isn't going to make a dent. It will be interesting to see how well these auctions do. The super high end items will probably do o.k. but I wonder how about the support and how many coins in the $5,000 ~ $50,000 range will move.

[cladking]

Collectors and dealers learn very early that supply is often feast or famine. If you don't buy something when it's available then it may be many years if ever before you see it again. Most people are willing to stretch to pick up items they need. This will result in fewer purchases for awhile unless they have something they can sell at a nice profit. And of course they'll be willing to stretch much further in a hot market than in a dead market. This makes the saturation point somewhat flexible. What would be considered excessive in slow markets might seem more like a famine in true bull markets.

 

I'd have to believe that today we are approaching the point at which this can be considered a true bull market, and that it can handle a lot more coins than this. There is a generational change in wealth that is getting going. Some of this wealth is in the form of rare coins and most of these will be hitting the market over the next several years. The market will absorb these and the transformation of the hobby will continue apace. While prices are generally determined by demand, it can sometimes be seen during such times just what role supply plays in setting prices and attitudes.

[pmh1nic]

According the information I've read the number of collectors, even giving the State Quarter program, has remained relatively static over the last 20 years.

 

"Some of this wealth is in the form of rare coins and most of these will be hitting the market over the next several years."

 

It will be interesting to see if this material can be absorbed by the market. There may be a lot of people collecting State Quarters but when the prices get into the $5000+ range I think the numbers dwindle dramatically.

 

If what Elcondator said "I have never seen so much expensive material being offered at one time ever before." is an accurate reflection of what's about to take place over the next couple of months in may be a real test of just how deep the market really is. Stay tuned.

 

[michael]

for me

 

there us a huge amount of cash out there wanting to buy coins BUT only the "right" coins which are the right coins you may ask? coins that are monsters with extraordinary qualtites that when you see them they walk talk and sing to you!! coins with extraordinary qualities

 

the people with the money only want monster coins coins that are the cream the crem de la crem so to speak which is only less than 5% maybe less? of the coins being auctioned

 

these above mentioned coins will bring not only strong money but record money

 

now some coins sold in the auctions will not even make bluesheet prices!

 

many will make only bluesheet prices

 

many slightly over bluesheet selling prices

 

and a few coins in the auctions lots more

 

 

and AGAIN the monster one of a kind one in a million extraordinary eye appealling coins with extraordinary qualities coins that walk talk and sing to you when you see them in person!!

will being more than strong money! record prices!!

 

sincerely michael

 

 

[TomB]

The right coins will sell for the right money; the others, you neither want nor care about.