Something I Have Learned About Numismatics

[TomB]

There are many things that I have learned about numismatics over the years. However, there are those times when someone says or thinks something and that something crystallizes a belief or theory very nicely. This happened to me at the ANA in Baltimore last week as I spoke with Larry Shepard. I had purchased a coin from Larry the day before and had paid ten times bid for the piece. I ended up paying over $1,000 for a coin that bids at approximately $100. The purchase made me very happy as the coin is a smoker and the few collectors or dealers that I had subsequently shown it to were impressed that I paid that little for the coin.

 

As I spoke with Larry I mentioned to him that, in my personal experience, I have learned that it is better to make an error of commission rather than an error of omission when it comes to purchasing coins with massive eye appeal. Immediately, Larry's face lit up and I knew I had found a kindred spirit. This is something that I have believed for many years but had never put so succinctly as that morning.

 

It is better to make an error of commission rather than an error of omission.

 

I thought I would share this with the board. There are many members of the boards that I know of who build their collections in this manner, however, there are many others who either have not had this realization or who simply do not subscribe to this theory. The idea is that I would rather pay extremely strong money for extremely strong coins rather than to adhere to a perhaps accurate guide sheet and try to buy coins according to the guide sheet price listings. Most of my coins have been bought by spending strong money and I have always done fabulously well when selling. Additionally, I derive great satisfaction from the aesthetics of my coins and great pleasure from the reactions of others when they see them in person.

 

As an aside, later that day I spoke with bigmoose, who has some of the most astonishing early copper I have ever seen, and his face also lit up when I mentioned my belief. It was easy to tell that he was aggressive in his purchases and the net result was a devastating group of coins.

 

Does anyone have any sage words to add to this?

[EVillageProwler]

I don't have any sage words to add, but I do agree.

 

Fiscal reality bites hard at me, but I still adhere to your cogently stated principle whenever possible.

 

EVP

 

[EVillageProwler]

Just want to add that one of my concerns regarding the way the U.S. coin market is currently structured is that too much emphasis is placed on a slabbed grade.

 

How many times have we seen a POS 65 "ask" for more money than a lovely 64? The lovely 64 should sell far more easily than the POS 65 coin.

 

The existing registry systems are a numbers game, and unfortunately allows collectors to forget that eye appeal has always been the key to collecting success over the long years.

 

EVP

 

[andy007]

Nicely stated and a well put together, cogent statement. I am not close to a true veteran collector or numismatist, but I do know what eye appeal is to me and 'the look' that is so tough to describe but so easy to know when you see it. I have finally realized, with plenty of help along the way from some helpful folks, and more specifically our own TomB, that acquiring pieces that everytime you pull them out and look at them, you will be impressed with what you have put together. This of course means that there are no sheets for coins of said quality.

[keithdagen]

If you waffle on a purchase, you'll sell the coin later.

 

I've been collecting for about five years now. I find two types of coins, those you fall in love with instantly, and those that you aren't sure of, but talk yourself into buying anyway.

 

If I had to talk myself into a purchase, I ended up selling the coin at a later date. The ones I fell in love with at first sight, I still have in my collection.

 

My advice -- if you're not sure fo the purchase or hesitate about it, skip it.

[braddick]

This is the best Thread here, ever.

I agree 100% and thought I was the only one who collected this way.

 

Nice to know I'm not alone whatsoever.

[Hoot]

Your principal, Tom, is a tenet of life: 'tis better to have committed oneself to quality and missed a few times than to have refrained and missed all opportunity for the experience. Thanks for the words.

 

Not always does an individual among us have the option for the penultimate best, but the same derivative is opted at all levels of commission. The formation of skill is the fulcrum of the execution of such action.

 

Thanks for being there, Tom, and for being so skilled as to pass your understandings on to others.

 

Andy - ...there are no sheets for coins of said quality. Ain't it the truth!

 

Hoot

[MikeKing]

I have to wholeheartedly agree. I think that as a true collector, the premium to pay for something you honestly recognize as truly spectacular, is entirely up to you, and fully 'worth it'.

 

There were two half cent pieces I passed on recently because I felt their prices went 'too high', but in retrospect, they were truly spectacular pieces I'm likely to not see again, and would certainly have been worth that extra stretch. There are other coins which I have extended myself for, that I doubt I'd ever see in such exquisite condition, elsewhere...even in higher grades. I certainly don't regret those purchases.

 

 

[MarkFeld]

Good thread, guys!

 

Along a similar (or, perhaps I should say, opposite) line, when I have a client who is deciding whether or not to purchase a coin, and who is bothered by a little something or other about it...

 

I will say "No matter how small/minor it is, if it bothers you now, chances are it will continue to bother you (more) later. And, it will be the first thing you notice every time you look at the coin. Don't buy it. I will say this, whether the little something or other bothers me or not, as it doesn't really matter how wonderful I might think the coin is, if the client doesn't like it.

 

 

[Elcontador]

Excellent thread.

 

EVP - The last few type coins I really liked; an 1810 Large Cent in PC 3BN and an 1802 Bust $ in AU 55 (think it was also a PC coin) were two really choice specimens. The first coin went for better than 5 $ & the second one went for Unc. $. People in the know apparently will buy these coins, not the holders. I'll bet that this Large Cent got a stronger hammer than another Classic Large Cent in the same auction that was slabbed by one of the majors as 4 BN. This dovetails into what Tom B said.

 

Mark raises an excellent point, as did Keith and another poster. If you hesitate initially about a coin, it "doesn't have your name on it."

 

The only issue I really have is how much is a particular attractive coin worth to me?

For material like this, the sheets aren't helpful. Still, what is it worth to you?

 

Earlier this year, I was offered the nicest Braided Hair Half Cent I've ever seen (image or in person), but I thought the pricing was a bit rich for me. I knew that I'd never see one that nice again. Still, we all have so much money to spend and decisions must be made. With that money, I did some work on the house and will buy some new computer equipment for the office later this year.

 

OTOH, you'll either wait until he** freezes over or buy really ugly coins if you can find, say, an AU 50 Bust $ or for that matter, a Braided Hair Large Cent in 65 RB for sheet bid or ask.

[EVillageProwler]

I remember with great sorrow a fab TD that almost became mine. It was a double-sided PL, and PQ for the grade too -- in spite of the delicate surfaces!

 

Prior to the sale, I was confident that I would go home with a new addition to my "Box of 20". Come auction time, and I got into a bidding war with some dealer who apparently was after it for a client. (I don't remember who...) When the level reached TWICE RETAIL, I blinked first.

 

To this day, I am still PO'ed with myself. I should have stayed in it until TRIPLE RETAIL. After all, what's that kind of money to someone who had absolutely no intentions of selling that coin? I mean -- really -- this coin deserved a place in my "Box of 20"...

 

Alas, I was not man enough to walk away with it.

 

EVP

 

[291fifth]

Please let us know what happens when it comes time to sell this "10 times bid" coin. I'll bet the dealers don't love it as much when it is time for them to make an offer.

[bigmoose-migration]

Great thread, TomB! I couldn't agree more with you. It is nice to know there are others who collect like this. I have never regreted paying strong money(even "stupid money" as some would say) for a coin with great eye appeal that I really liked or a coin that I thought was a great coin, whatever the series. I have regreted paying average money for a coin I was lukewarm about.

[jtryka]

I learned this lesson long ago in investing. So often I would like a company and want to buy the stock, but would put in a bid an eighth or teenie (yeah, this was before decimal trading, so the spreads were wider, and an eight is 12.5c and a teenie is 1/16th, or 6.25c) below the market, and the order would go unfilled. Then the stock would move and I missed my opportunity. Finally a good friend from the trading desk asked me why was I doing this? I'd miss opportunities on buying and selling that were worth thousands only to save a few hundred bucks. Ever since, if I like a company and want to buy the stock, I throw it in at the market. The same is even more true in coins, as it's a much more illiquid market, and every one is different. If you miss that truly great coin, you may indeed never see another. Then you'll miss far more than a few bucks, but the enjoyment of having that coin in your "box of 20."

 

Another thing EVP touched on was the emphasis on slabbed grade, which is quite common today. Well TomB's original thesis applies to coins in all grades in my opinion, not just the top-pop super high grade coins. I can't tell you how often I buy really great coins that might be lower MS or even AU! Or worse, lower circ grades! This is where I come out on a lot of older gold. To me, many of the higher graded classic gold looks like [!@#%^&^] for the grade, but a nice XF piece looks so distinguished to me for a 175 or 200 year old gold coin. I've seen far more AU bust halves that appeal to me than MS, and when I find a nice one I'll pony up for it. It just seems that with modern super-grades and registry sets, many collectors either forget, or never get to know the beauty of truly original circulated pieces.

[MikeKing]

Alas, I was not man enough to walk away with it.

 

No no no no no no no!!!! EVP:::::::

Leaving a good coin is good for the soul.

It gives you an appreciation of what is of value to you.

It gives you something to compare things to.

It will help guide you in the future for what you truly want and will enjoy.

You were man enough to walk away without it

 

 

[MikeKing]

It just seems that with modern super-grades and registry sets, many collectors either forget, or never get to know the beauty of truly original circulated pieces.

 

Hear Hear

[Oldtrader3]

Tom: Stating your personal collecting epiphany benefits all of us. It is too easy to be lulled into the "win at all costs" mentality of some Registry members.

 

Awakening for me came when I started to seriously collect US gold, about (3) years ago. I do not have a large degressionary income and this limitation forced the decision as to whether AU (or even nice XF) coins would meet my collecting standards and goals. It really came down to the choice of finishing Type Sets, or not.

 

Happily, the decision was to selectively buy, nice for grade, circulated coins at prices often over retail bid. I have never regretted this decision and still have all of the coins purchased since that decision. Some of these AU Half Eagle, Eagle and Double Eagle dates/MM's that I have subsequently purchased, are seldom available. When they do eventually do appear at auction, they are high-end MS's that are way out of my price range.

 

I am beginning to form a strong opinion that US Gold is a tightly held, often resubmitted (causing misleading Pop's), market that has yet to realize it's potential. The supply is very thin on many issues. IMHO, the only factor holding back significant price gains is lack of sufficient stock for promotion, collector knowledge and grading skills. Gold is most challenging to grade.

 

Now, If I ever want to finish my USA Type Set, I have to learn to grade and appraise AU Brown-Copper. I look forward to the challenge.

[jom]

Just want to add that one of my concerns regarding the way the U.S. coin market is currently structured is that too much emphasis is placed on a slabbed grade.

 

No kidding? Where did you ever get such an idea?

 

How many times have we seen a POS 65 "ask" for more money than a lovely 64? The lovely 64 should sell far more easily than the POS 65 coin.

 

Same holds for cherry-picked AU58's vs many MS63's.

 

The existing registry systems are a numbers game, and unfortunately allows collectors to forget that eye appeal has always been the key to collecting success over the long years.

 

That is inflammatory talk! You will be arrested and jailed!

 

jom

[RotatedRainbows]

What it really comes down to is if you are a true coin collector or just a wannabe, if I buy a nice coin above book value (since I collect toned coins and errors most coins I purchase are above listed values) and then in the future sell it for what I paid for it I am thrilled since I received 100% of my purchase price PLUS I had the pleasure of owning the coin. If I sell a choice coin for less then I paid for it I am not heart broken or think I over paid because I received VALUE in having the pleasure of owning the coin. That is one thing that most of today's collectors/ivestors/speculators seem to have forgotten, if you don't receive VALUE from owning a special eye appealing coin (enjoy having it and being able to look at anytime you want) then you are probably in the wrong hobby. Some peoples hobby is to travel a lot, spend lots of money going to different cities around the world yet when they get home they end up with nothing of value or no way to recover their money but they don't feel cheated because they received VALUE from their experiences and what they saw.

 

A true collector will ALWAYS receive value (satisfaction) from owning a special coin so if in the future they sell it for less then they paid for it they will still feel they paid a fair price if they TRULY enjoyed owning the coin. The same goes for if you buy a blah coin at a cheap price and are just barely able to get your money back when you sell, you most likely did not receive any value from owning it so in the end you would have been better off paying more (even overpaying) for a coin you truly ENJOYED owning. If you really enjoy owning an average coin and you get VALUE doing it then that is GREAT and you are doing what a true collector does (the reason you started this hobby) but if the most enjoyment comes from competing in the registry (the competition aspect) with little regard to what the coin REALLY looks like then you are not a true COIN collector. You most likely are just someone who enjoys the competition and would get the same pleasure regardless of what arena you are participating in. If you truly truly enjoy owning a certain coin it is hard to say you over paid for it regardless of if you paid book value or 10X book value.

[IrishMike]

I still remember the advice I got along this line when I began collecting coins in the 50's. My dad started us with the blue whitman for lincoln cents and my brother and I were in a race to see who could finish it first, of course not realizing it would be impossible to finish. I used to show it proudly to the dealers and always got "gee that is nice kid" remarks. Finally one of the old timers clued me in. He said sonny only collect what knocks your socks off with its eye appeal, if you like the way it looks so will someone else when you get ready to sell it.

 

Unfortunately too many times over the intervening years, I have forgotten this.

[shirohniichan]

I've seen far more AU bust halves that appeal to me than MS, and when I find a nice one I'll pony up for it. It just seems that with modern super-grades and registry sets, many collectors either forget, or never get to know the beauty of truly original circulated pieces.

 

Yea, verily.

 

I bid three times bid on a really nice trade dollar and thought for sure it would be mine. I even got nervous that I was paying way too much for the coin, but I blinked first and walked away without the coin. Had I not been out of work for a few months this year I'd still have been kicking myself for not sticking it out (now I see that things have worked out for the better).

 

Now I have my eye out for nice XF to AU coins.

 

'Tis better to have bid and lost than to have never bid at all.

[tarboosh]

I am not a coin collector (I collect vintage comics) but I stumbled on this thread and find the discussion of collecting the "finest available" very interesting. Since third party professional grading has been available to coin collectors for some time now, I'm wondering if someone can answer the following questions:

 

1. I presume that third party grading has resulted in vast multiples of "book value" paid for rare high grade coins. Have prices for the best coins stayed high, or did they peak shortly after third party grading was introduced only to come down later? I'm only referring to "top-graded" coins that are genuinely scarce.

 

2. Did most of the better pieces get certified in the first few years after third party grading was introduced, or has the supply of top-graded material steadily increased year after year as more collections get graded and entered into the database?

 

I'm just wondering what lessons my own hobby can learn from yours. Third party grading has been available to comics for three years now and has resulted in stunning prices for "top-graded" material. I'm wondering if this is "irrational exhuberance" over a new grading system or a sign of things to come. Thanks for indulging my intrusion into this thread.

[LucyBop]

As a fellow Comic collector and a strong Buyer of Archie Golden age comics I think that the brand new Comics Registry is going to spark excitement and cause many to join CGC and submit their GEMs, and compete for the finest known collections. As a result, the "pop top" grades will command strong prices, just as it is with the coin registry....

 

I wonder if the same agruements may break out in the comic forums, such as buying the slabb'd grade vs buying the book.....

 

Many will embrace the Registry, many will dispise it....

 

I need for Dena to give me a Archie Golden Age Comics reg set....

what a fun ride it will be......!