A new breed of dealers has emerged ( at least I never knew )!

[realone]

Now there are dealers who for 10 to 15% advertise on their website a coin that they know absolutely nothing about, don't advertise the description correctly, don't have or own the coin, and don't negotiate one cent off the asking price, mention aspects about the coin that are absolutely wrong, or is heresay touted as fact, they even ask you to trust them and/or their facts, are troubled by you asking questions, charge the prospective buyer the shipping expense, and have a lousy attitude to boot. I am not against coin brokers, but as a real estate broker I will try to earn my fee/commission by trying to promote open negotiation, goodwill, and knowing my product. What is the coin broker doing for his fee, he already has an up and running website listing the coins he supposedly owns, as a coin broker he would make a greater profit margin than if he had the expense of owning the coin. I know I am going to catch *spoon* from the dealers out there because there are a lot of them so let it hit the fan guys.

[coinman1794]

O have seen this and i think its a poor marketing gimick that hurts those who are expected to buy these coins. The ones I've seen are severely overpriced and have bad pictures. You can make offers, but when you are starting in the stratosphere, it doesn't help much.

[World Colonial]

If the coin is worth anything, why do sellers even use this service? They would probably be better off consigning it to a big auction firm or even Teletrade.

[michael]

i know some like this

 

and realone........................

 

you really make a great point and sum things up really well

 

pass on these human pathos dealers

 

in fact

 

they are not human and are hatched by their repitillian mothers

[DirtyGoldMan]

Nothing new here. Coin brokers have been around for quite a while. Occasionally, you can get something you need from them, something rare and otherwise difficult to find (ie. I bought my 1861-O $20 from one a few years ago), but for the most part, they add little or no value.

[James_OldeTowne]

I (and many other collectors) have been using the term "coin broker" for several years. Used in a disdainful manner, it generally refers to sellers who, just as you say, know nothing more than the grade written on a slab, and how to find the column corresponding to that grade in a given price guide.

[EZ_E]

A couple of years ago, I went to add a substantial number of modern commemorative dollars to my Dansco collection. New World Raritities offered a complete listing of the coins at an apparent decent price. I ordered over $3K worth. However, as it turned out, they charged me for over a thousand dollars in coins that they didn't even have in stock nor could they acquire. It took me over a month to even obtain my refund from the over payment.

 

I object to a dealer advertising coins that they don't even have in stock. I'm sure that there are exceptions but they should tell you upfront before placing the order.

[Dcoin]

In any business the middle man is often the most poorly informed member of the transaction. However in this business, ignorance can be expensive.

[DirtyGoldMan]

I (and many other collectors) have been using the term "coin broker" for several years. Used in a disdainful manner, it generally refers to sellers who, just as you say, know nothing more than the grade written on a slab, and how to find the column corresponding to that grade in a given price guide.

 

I do not agree with your definition, James. A "coin broker" is one who sells coins that he does not own or possess. It is debatable whether selling coins on consignment or memo makes one a broker. From a practical standpoint, if most of your inventory is owned by you, you are a dealer, not a broker. If most of your "inventory" is owned by someone else, you are a broker, not a dealer.

 

There is a Doug Winter article that touched upon this area in the distant past. I will try to dig it up and link it to this thread.

[DirtyGoldMan]

Here's the quote from

and How To Correct Them" target="_blank">=http://www.raregoldcoins.com/get_article.asp?id=20010914a]Five Beginner's Mistakes

and How To Correct Them

.

 

Mistake #2: A new collector buys his coins second (or even third) hand.

 

Many (if not most) new collectors buy coins from brokers. In numismatics, a broker is defined as someone offering a coin for sale which is not from his inventory. There is nothing wrong with coin brokers. But often times buying coins from the dealer who owns them will save a collector from 10 to 30%.

Correction:

 

The solution for this problem is relatively easy. Buy coins from the people who actually own them. Ask your dealer if he owns the coin(s) he is offering you or if it is from other sources. As you become more involved in numismatics, you'll learn how to see if the dealer you ask this question to is telling you the truth. If, for example, he cannot accurately describe a coin, the chances are good that he has not seen it (and does not own it).

 

There are circumstances when it is acceptable to buy coins from a dealer who does not own them. A dealer may act as your agent at an auction and bid on coins that are not his. Or, a dealer might call you from a show to let you know he's found a piece on your want list that is from another dealer. In this case, there is nothing wrong in using the dealer as a broker, provided his markup is reasonable. In such a transaction, a dealer generally makes a small (5-10%) profit. Since he does not own the coin and will have no downside risk in sending it to you on approval, he does not merit as large a profit as if he owned the coin and had downside risk.

[James_OldeTowne]

I stand corrected, and agree with Robert's comments in both posts. The only footnote would of course be that many dealers take coins on consignment, often at the insistence of the seller.

[Quizno-migration]

There are two web sites offering for sale an 1802 half dime in a PCGS VF-30 holder for the price of $155,000. Assuming that each is offering the identical coin, which is the broker and which is the dealer?

[realone]

Maybe neither website has the coin or is the dealer of the coin, I know this to be true of another coin that is listed on 2 different websites, because I called both.

[World Colonial]

There are two web sites offering for sale an 1802 half dime in a PCGS VF-30 holder for the price of $155,000. Assuming that each is offering the identical coin, which is the broker and which is the dealer?

 

The 1802 half dime is one of the few US coins that is both rare and hard to find at the same time. Several other US coins are rare, like the 1796 and 1797 half dollars, but they are still available farly often. The chances of this coin being available in exactly the same grade from two sellers is essentially zero.

[DirtyGoldMan]

There are two web sites offering for sale an 1802 half dime in a PCGS VF-30 holder for the price of $155,000. Assuming that each is offering the identical coin, which is the broker and which is the dealer?

 

Sometimes dealers go into big coins as partners, so it is possible that both parties share ownership of the coin.

[DirtyGoldMan]

I stand corrected, and agree with Robert's comments in both posts. The only footnote would of course be that many dealers take coins on consignment, often at the insistence of the seller.

 

I think having coins on consignment is part of the typical dealer inventory. In the past, for example, I have consigned coins to you (if you recall). There are many reasons for collectors to consign coins to dealers, and it usually becomes a win-win situation. In our case, you handled a few coins that you typically would not buy at no risk to you, you sold them for a smal profit to you, and I got my money out if of the coins. Everyone is happy.

 

It's when most or all of your inventory belongs to someone else that you become a broker.

[Houston Investor]

One major rare coin wholesaler gives out slabbed coins on invoice to other dealers at shows. The reason for this is simple - the major dealer wants to spread his inventory around the room for maximum sales. The dealers have until the end of the show to either pay for the coins or return them to the major dealer. If the dealers either buy these coins or sell them at retail it is a win / win for both the dealers and the major rare coin firm.

 

Consequently, no one but the dealer whose table they reside at and the wholesaler know the true ownership of the coins. At one of these shows I took 10 $20 Liberty Gold pieces on invoice (at CDN Bid) from him which all graded MS 63. I knew I was going to buy at least 2 so I put away those coins I liked the most. Then I was able to retail 5 of the remaining 8 having making enough profit from those to buy one more. I also had $350 profit from junk box sales of $600 (used this money on a commem deal I got at 80% of CDN Bid from this guy that walked up with some to blow out) and about $500 profit from $1700 sales of misc slabbed coins (which I added to "show cash." purchases where I can buy below bid). All in all it was a fun show, especially whan I was able to acquire what I had come for.. A dealer in Dallas the next week asked me "how was the Pasadena show" I told him it was well attended but mostly "just fun and games."