Coin Market Update

(2/2/12)

 First, a look back at the year 2011:

• Precious metals prices soared through most of the year, but fell back at year end led by silver’s swoon.  Gold gained about 16% and silver lost about 10% for the year.
• Winners for the year included larger ($10 and $20) gold coins, gold bullion, higher end rare coins, nicer Morgan and Peace silver dollars, and proof Silver American Eagles.  Losers included proof and mint sets and some collector (Lincoln cent, Indian cent) key dates.
• Among our recommendations, early US gold and silver (pre-1834), type 1 $20 gold (1850-1866), and Carson City coins all did very well.  Quality coins versus ho-hum coins of the same grade continued to outperform.  Classic gold and silver commemoratives were stagnant, and collector key dates were mixed to down.
• The various published indices showed a generally positive picture for 2011.  Coin World’s “Investment Class Rare Coin” index gained 4.98%.  The PCGS 3000 index gained under 1%.  The COINage MS65 index gained about 3%; the COINage VF index gained about 5%.  All bettered the return on bank savings.

 

We are neither financial advisors nor prognosticators.  There are, however, a few things we expect to see in 2012:

• Price differences between the best quality coins of a given grade and the “dogs” will continue to increase.  Impaired (cleaned, tooled, puttied, damaged) coins will be a tough sell.
• Generic gold coins (common date $5, $10, and $20 pre-1933 gold) are trading for barely over gold bullion, and currently represent a better value than gold bullion coins.
• For those who look for severe economic conditions, bulk 90% silver (pre-1965 dimes, quarters, and halves) and 1/10 oz. gold bullion coins are still reasonable options.
• Our favorites in the rare coin market remain early US gold and silver coins (pre-1834), type 1 $20 gold (1850-1866), Carson City coins, and key dates in popular collector series.  Why?  These coins have a consistent track record of long-term price appreciation.
• Nicer classic (1892-1953) gold and silver commemoratives and smaller pre-1933 gold coins ($1, $2.50, $3) have been dumped too quickly (in our opinion) as people moved to gold and silver bullion and larger pre-1933 gold coins ($10, $20).  Maybe 2012 will be their year?

 

Our wish for you in 2012 is the same as every year:

• Walk humbly with God
• Love and appreciate your family and country
• And by all means, add a few really special coins to your collection

 Feel free to contact us any time for more information on coin-related topics.

 Coin Market Update

(11/4/11)

 

Market Update:

Since the last market update in August, gold soared to over $1900/oz., then dropped under $1600/oz., and is now in the process of moving up again (see below).  Silver dropped from $48/oz. to under $30/oz. before recovering to around $34/oz.  Demand for rare coins and collector coins was little affected by all this and the overall coin market remains healthy.

 

What’s Hot: Liberty seated half-dollars and dollars; early large cents and half cents; early $5 and $10 gold; type 1 Liberty $20 gold and Carson City gold; Barber (1892-1916) quarters and half dollars

 

What’s Not: Some Indian and Lincoln cents; small denomination gold coins ($1, $2.50, $3); proof half-dollars and dollars (Trade, Morgan, and Peace)

 

What Happened When Gold Corrected Sharply:

In mid- to late-September, the spot price of gold dropped by over $300/oz. in a time frame of only two weeks.  While perhaps gut-wrenching for those who bought gold bullion at $1900/oz., it was very instructive to see how the various segments of the coin market responded.  Here’s what we observed:

• Prices for gold bullion coins, of course, plummeted in tandem with the slide in gold spot price.  However, there were very few sellers at the lower levels and plenty of buyers; those attempting to buy bullion coins at the lower price levels had difficulty finding them.
• Generic gold (pre-1933 U.S. gold coins in common dates) dropped far less than gold did.  The price of MS64 $20 St. Gaudens gold coins in common dates is a pretty good proxy for the generic gold market.  While bullion coins dropped the same $300/oz. as the spot gold price, MS64 $20 St. Gaudens coins (which contain very nearly an ounce of gold) dropped only $100-135 each.  So generic gold did indeed provide some protection in a down market compared to bullion coins.
• If there was any effect on the prices for rare numismatic coins and popular collector coins, we were unable to detect it.  Demand remained steady.  Once again it was demonstrated that rare coins and bullion coins are two very different markets.

No doubt there will be many more ups and downs in the gold and silver bullion markets.  Consider substituting generic gold coins for bullion coins if you want downside protection.  And for the long term, rare coins may be the best bet of all.

 

Coin Market Update

(8/4/11)

 

Market Update:

A quiet summer was upended the past few days, with gold and silver again on an upswing.  Numismatic coins (those not dependent on their bullion content for their value) have been trending upward throughout the summer.  Rarer and higher grade numismatic coins are outperforming more common coins.  The first big coin show of the fall is the Chicago ANA Show, and expectations are high.

 

What’s Hot: Nicer Morgan and Peace dollars, early silver dollars, early large cents, Type 1 $20 gold and Carson City gold, and all Barber coins (1892-1916 dimes, quarters, half dollars)

 

What’s Not: Indian and Lincoln cents, small denomination gold coins ($1, $2.50, $3), and some key dates in popular series.

 

Objectives are the Place to Start:

When considering which coins to buy, a good starting point is to understand your objectives.

1)      Those looking for the least expensive silver

a)     Usually silver rounds, silver bars, or 90% silver (pre-1965 dimes, quarters, half dollars)

b)     Options to add a little spice: circulated Morgan or Peace dollars, silver American eagles

2)     Those looking for the least expensive gold

a)     1 oz. gold bullion coins (American eagle, Canadian maple leaf, South African Krugerrand)

b)     A great alternative is generic (common date pre-1933) $10 and $20 gold coins, which now trade with virtually the same premium over melt value as the bullion coins.  Modern $5 gold commemoratives are less expensive than ¼ ounce bullion coins.

3)     Those desiring to put together nice collections

a)     Long-term collectors tend to focus, study a particular series, and seek  quality coins; consequently they frequently reap the greatest returns when they sell

b)     Popular series include Indian cents, Lincoln cents, Buffalo Nickels, Barber coins, Walking liberty half dollars, Morgan dollars, $2.50 gold Indians, etc.

4)     Those seeking long-term appreciation via coins

a)     Avoid the temptation to buy on price rather than quality.  See our criteria for “coins worth saving” at http://www.coinsworthsaving.com/Coins_Worth_Saving.html

b)     Historically, key dates, early type coins, and rarities have appreciated handsomely over time

5)     Those searching for out-of-favor series that might regain popularity

a)     Currently, these include small denomination ($1, $2.5, $3) pre-1933 gold coins, classic gold or silver commemoratives, 2 cent pieces, or nickel three cent coins

 

Coin Market Update

(5/17/11)

 

Market Update:

Obscured by volatility in bullion prices, the overall coin market has moved steadily higher by about 4% this year.  Rare coins and those that are nice for the assigned grade have been very difficult to locate, with most locked up in collections for years to come.  Overgraded coins and those with poor eye appeal are everywhere.  Choose carefully.

 

What’s Hot: Walking Liberty half dollars, nicer Morgan and Peace dollars, early silver dollars, Type 1 $20 gold and Carson City gold, and, until 2 weeks ago, gold and silver bullion.

 

What’s Not: Indian and Lincoln cents, 2 and 3 Cent coins, Buffalo and Liberty nickels, small denomination gold coins ($1, $2.50, $3), and many key dates in popular series.

 

The Bullion Roller Coaster:

In the last few months, wild swings in gold and silver bullion prices have attracted a lot of attention.  Gold started the year around $1420/oz., dropped to 1320/oz., powered its way near $1575, then fell to $1480 at the time of this writing.  Gold is virtually unchanged for the past 30 days, up 11.5% in the last 6 months, and up over 21% in the past year.  Silver, not to be outdone, is down 21% in the past 30 days, up 34% in the last 6 months, and up 81% over the past year.  It’s been quite a ride – both up and down.

 

In contrast, numismatic or rare coins have been downright boring.  Various reports show numismatic coins up about 4% in 2011, and 7-8% over the past year.  What about the long run?  Since January 1970, silver is up an amazing 1876%; gold an even more amazing 4242%.  In the same period, those boring numismatic coins are up 6677% (based on the PCGS 3000 Index).

 

There’s no denying that straight bullion has outperformed numismatic coins over the past decade.  We sell quite a few bullion coins, and believe there are legitimate reasons to own them: fear of inflation, financial turmoil, dollar devaluation, etc.  That said, more than a century and a half of history make a compelling case for numismatic coins.  It is rare indeed for bullion to appreciate more quickly than numismatic coins over extended periods.  Is the bullion run over?  Good question; we are neither financial advisors nor prognosticators.   Nevertheless, we believe there is a strong case to be made for numismatic coins over bullion going forward.

 

Feel free to contact us any time for more information on coin-related topics.

 

 

Coin Market Update

(2/2/11)

 

As we enter the early part of 2011, it’s worth looking back at some of the major trends that shaped 2010:

• Gold, silver, platinum, and palladium prices soared, along with the corresponding bullion coins.
• The high end of the rare coin market was strong.  Examples include a 1794 silver dollar setting a new all-time highest price for any coin, and a record price for a 1943 copper cent, among others.  Proof gold also powered higher.
• Outside gold, silver, and rarities, there wasn’t a great deal of price appreciation across the rare coin market.  Morgan and peace dollars did show some strength.
• The price difference between premium quality coins and ho-hum coins of the same grade continued to expand.  Problem coins were very difficult to sell.
• PCGS and NGC introduced + grading in an attempt to compete with CAC.
• The largest coin seller in the world (the US Mint) continued to flood the market with modern products, offering 106 different 2010-dated coins with a total cost of over $18,000.

 

We are neither financial advisors nor prognosticators.  There are, however, a few things we expect to see in 2011:

• The rare coin market is off to a strong start.  A recovering economy should lend further upside support.  While the market paused in 2009 and early 2010, rare coins have a long history of appreciation.
• Generic gold coins (common date $5, $10, and $20 pre-1933 gold) are trading for barely over gold bullion, and currently represent a better value than gold bullion coins.
• For those who look for severe economic conditions, bulk 90% silver (pre-1965 dimes, quarters, and halves) and 1/10 oz. gold bullion coins are still reasonable options.
• Our favorites in the rare coin market remain early US gold and silver coins (pre-1834), classic gold and silver commemoratives, type 1 $20 gold (1850-1866), Carson City coins, and key dates in popular collector series.

 

Our wish for you in 2011 is the same as every year:

• Walk humbly with God
• Love and appreciate your family and country
• And by all means, add a few really special coins to your collection

 

Feel free to contact us any time for more information on coin-related topics.

 

 

 

Coin Market Update

(11/12/10)

 

Overview:

The big story in the past three months has been soaring gold and silver prices.  It would be an exaggeration to say that the rest of the market is on hold, but not a huge exaggeration.

 

What’s Hot:  Gold and silver bullion coins, 90% silver coins, lower grade Morgan and Peace dollars, lower grade $10 and $20 gold coins, seated liberty and walking liberty half dollars

 

What’s Not:  High grade modern coins, most copper coins including Lincoln and Indian head cents, most nickel coins, some higher grade gold coins

 

Are There Still Bargains in the Coin Market?:

It’s a reasonable question after several years of a strong coin market.  The answer is a resounding yes.  Like any market, not everything goes up at the same time.  Here are a few places where prices have not moved yet, or have even decreased:

·        Lower Denomination Numismatic Gold – Three dollar gold coins in all grades are trading for less than two years ago; even though all are scarce.  Better grade (MS-63 or higher) $1, $2.50, and $5 gold coins have come down in price as buyers have stampeded into the lower grade $10 and $20 gold coins and bullion.  A $5 Indian in MS63 now costs 40% less than two years ago.

·        Popular Collector Coins – Would you believe that the 1909-S VDB Lincoln cent, 1877 Indian head cent, 1937-D three-legged buffalo nickel, and many of the all-time collector favorites are down compared to a year ago?  In blind pursuit of gold and silver bullion, many have temporarily abandoned these and other timeless classics.

·        Gold and Silver Classic Commemoratives – We’ve been accumulating and recommending these for several years.  All are rare.  Although prices have started to move higher recently, they remain well below the levels of a few years ago.

·        Better Date and Higher Grade Silver Dollars – The lower grade coins have moved up sharply due to their silver content.  Only now are the better dates and higher grades starting to join the party, though still at a level well off previous highs.

·        Generic Gold $5, $10, $20 Coins – As outlined in our 8/13/10 coin market update, the premiums on these coins over their bullion value are at all time lows.  Does it really make sense to buy a gold bullion coin at 4-6% over bullion value instead of a $20 Liberty or St. Gaudens for 7-8% over bullion value?  If gold goes higher, the $20’s should go up just like the bullion coins.  But if gold prices go down, the $20’s may go down less assuming their premiums return to normal levels.

·        Currency – U.S. currency prices were hit harder than coin prices in 2009, and some beautiful historic notes remain below prior levels.

 

Bottom Line:  If you wish to accumulate silver or gold bullion, we can certainly help with that.  However, it may be worth looking at generic gold and silver or other numismatic coins that have fallen out of favor in the last year or two.  It may also make sense for some to trade gold bullion coins for generic gold coins to take advantage of the historically low premiums in the latter.

 

Feel free to contact us any time for more information on coin-related topics.

 

 

Coin Market Update

(8/13/10)

 

Overview:

It’s difficult to get a clear fix on the coin market over the summer, since activity is much slower.  However, the bell-weather ANA show in Boston this past week certainly suggested a stronger market.  The modest downturn of 2009 and early 2010 seems to be in the past, and most coin types are showing some upward price movement.

 

What’s Hot:  Morgan dollars, early type coins (1793-1838), Barber coinage, better date gold coins, Indian cents, twenty cent pieces

 

What’s Not:  Generic gold coins, high grade modern coins, Lincoln cents

 

Coins we like at today’s prices: Early type coins (1793-1838), early and rare date gold, Carson City gold, key dates in popular collector series, and selected classic gold and silver commemoratives.

 

Low Premiums on Generic Gold Coins:

Ecclesiastes 3 says “there is a time for everything, and a season for every activity under the sun”.  Readers of our coin market updates over the years know that we’ve consistently favored numismatic gold coins over generic gold, based on historic price performance.  However, generic gold coins have recently been pummeled relentlessly.  Between 8/11/09 and 8/11/10, spot gold prices increased 28% from 942.75 to 1205.50.  Generic gold coin prices, as reflected in the PCGS generic gold index, have decreased 13% in the same time period.  Generally, the definitions are as follows:

·        Bullion Coins (US Eagle, Canadian Maple Leaf, South African Krugerrands, etc.) are relatively modern coins minted and sold by various governments for their gold content.  There is little or no numismatic (collector) value, and they tend to track gold prices closely.

·        Generic Gold Coins (common US gold coins minted pre-1933) – They trade at a modest premium over the value of their gold content.  This premium can rise or fall quite a bit over time, depending on collector/investor demand among other factors.

·        Numismatic Gold Coins (Rarer or higher grade US gold coins minted pre-1933) – These coins may be slightly influenced by gold prices, but trade mainly on collector/investor demand.  Prices are many times the value of their gold content, and there is a limited supply.

 

What happened?  Earlier in the year, premiums on generic gold soared as they were promoted by TV shows and telemarketers.  When the promotions ended, prices on some generic gold dropped almost to the level of bullion coins.  If spot gold prices do not fall and the premiums on generic gold coins return to normal, it could be a good time to own them.  Particularly hard hit are mint state $5 Indians, mint state $10 Liberties and Indians, plus lightly circulated and mint state $20 Liberties and St. Gaudens.  Circulated $20 Libs and Saints can be purchased for as little as 10% over gold bullion.

 

Bottom line: if you want to own historic US generic gold coins, this may be a good short term opportunity.  We still favor numismatic or rare coins (gold, silver, copper) for the long term.

 

Feel free to contact us any time for more information on coin-related topics.

 

Coin Market Update

(5/19/10)

 

Overview:

The past three months have been dominated by rising spot gold and silver prices.  Bullion coins and generic gold have benefited the most in terms of price increase.  The rest of the coin market is generally stable to rising slightly.  Affordably priced collector and type coins continue to do well.

 

What’s Hot: Bullion coins and bars, generic gold coins (especially $10’s and $20’s), large cents, silver three cent pieces, seated half dollars, early dollars, and Barber dimes, quarters, and halves.

What’s Not: High grade modern coins.  Lincoln cents have cooled off.  Currency has stabilized but is not yet increasing.

On our Shopping List: Type 1 Liberty $20’s (1850-1866), Carson City gold, rare gold in all denominations especially $5 and below, early type coins (1793-1838), key dates in all series, and selected classic gold and silver commemoratives.

 

Fun and Interesting Ways to Collect U.S. Gold:

·        Type Sets:  By far the most popular is the 12 Coin Type Set, consisting of: Type 1 $1 (1849-1854), Type 2 $1 (1854-1856), Type 3 $1 (1856-1889), Liberty $2.50 (1840-1907), Indian $2.50 (1908-1929), Indian Princess $3 (1854-1889), Liberty $5 (1839-1908), Indian $5 (1908-1929), Liberty $10 (1838-1907), Indian $10 (1907-1933), Liberty $20 (1850-1907), St. Gaudens $20 (1907-1933).  For the 16 Coin Type Set add:  Liberty $5 No Motto (1839-1866), Liberty $10 No Motto (1838-1866), Type 1 Liberty $20 (1850-1866), Type 2 Liberty $20 (1866-1876).  For the 18 Coin Type Set add:  $2.50 Classic Head (1834-1839), $5 Classic Head (1834-1838).

·        Mint Marks:  Collect an example of each of the seven mint marks represented on US gold coins:  Charlotte (C), Carson City (CC), Dahlonega (D), Denver (D), New Orleans (O), Philadelphia (no mintmark), and San Francisco (S). 

·        Complete Sets:  Among all gold series, the most affordable by far is the 15 coin $2.50 Indian set.

·        Specialty Sets:   Various pioneer gold collections can be assembled from privately minted Georgia, North Carolina, California, Utah (Mormon), Alaska, and Colorado gold.  Costs are generally high, with the exception of Fractional Gold which is quite affordable (including Kansas Fractional Gold).  Other sets:  Classic Commemorative Gold (1903-1926) consisting of 11 coins (plus two $50 Pan Pac if your budget allows); 24 coin set of $5 Modern Commemorative Gold (1982-2010); 6 coin set of $10 modern commemoratives.

·        Bullion Coins:  Uncirculated 1 oz. examples of Gold American Eagles (1986-Current) dated most years can be purchased for $75-85 over spot gold; proof 1 oz. examples cost $500-700 over spot gold.  Fractional Gold American Eagles (1/10, ¼, ½ oz) carry higher premiums.  Uncirculated 1 oz. Gold American Buffaloes (2006-Current) trade for $80-90 over spot gold; proof 1 oz. coins $130-140 over spot gold.  Fractional Gold Buffaloes (2008 W 1/10, ¼, ½ oz.) also carry much higher premiums.

Ask us for further information on any of the above, or call any time we can assist you.

 

Coin Market Update
(2/9/10)

 

Overview:

The 2009 coin market was generally characterized by strong price increases in generic (common) gold, weakness in higher priced coins ($15,000 and up), and a steady performance by collector coins (lower priced coins in popular series).  The New Year is opening in markedly different fashion.  Generic gold is down on lower spot gold prices and reduced TV and telemarketer promotion.  Higher priced coins seem to have stabilized.  Collector coins continue their steady march.  Price disparities between nice coins and off-quality coins are increasing, as nicer coins steadily disappear into long-term collections.

 

What’s Hot: Early (1793-1857) cents and half-cents, seated half dollars, most coins that are nice for the assigned grade.

What’s Not:  Bullion coins and bars, generic gold coins (especially $10’s and $20’s), most silver dollars, high grade modern coins.

On our Shopping List: Type 1 Liberty $20’s (1850-1866), Carson City gold, rare gold in all denominations especially $5 and below, early type coins (1793-1838), key dates in all series, and selected classic gold and silver commemoratives.

 

How do High Gold Prices Affect Rare Coin Prices?

The market for gold and the market for rare coins are very different, but they can be related.  This has been particularly true in the last few years, with gold and silver prices rising sharply.  Positive effects on numismatic coins include:

• The numismatic value of many gold and silver coins has been surpassed by the value of the gold and silver they contain, driving up their prices.
• Some people who buy gold and silver bullion will eventually move into rare coins.
• Bullion sales provide profits for coin dealers/collectors, who may reinvest in rare coins.

There are also negative effects:

• Gold coins/bars can attract money away from rare coins.
• Coin dealers with limited working capital can’t afford to stock as many rare coins because of the high cost of carrying bullion coins in inventory.
• The price volatility of gold can scare people away from all coins, including rare coins.

On balance, rising prices for gold and other precious metals have been positive for rare coins over the past few years.  Time will tell how long this continues.

 

Gold and silver bullion prices have tailed off over the last month.  It may be a good time to buy for those who desire to accumulate bullion as a hedge against inflation or paper currency devaluation.  For those with patience, we continue to favor rare coins; their price appreciation has consistently outperformed that of bullion over longer periods.  Either way, we’re here to meet your coin-buying or selling needs.  Feel free to contact us any time for more information on coin-related topics.

 

 

Coin Market Update
(11/14/09)

 

Overview:

For the previous 5 years, virtually all parts of the coin market moved higher together.  This year, different segments of the coin market have performed quite differently:

          *  Generic Gold – Already up close to 25% this year, common date gold coins continue to power higher in tandem with bullion prices.

          *  Collector Coins – The lower-grade and mid-grade Indian and Lincoln cents, buffalo nickels, mercury dimes, walking liberty halves, and other collector series have remained strong throughout, though Lincolns are soft lately.

          *  Early Type, Key Dates, and Rare Gold – The high dollar coins that led the market inexorably upward over the past five years have been down as much as 5-10% in 2009; but their prices are firming again.

          *  Morgan and Peace Dollars – Prices have slid 5-8% over the past year, but seem to be leveling out now and may be poised to gain strength.

          *  Silver and Gold Classic Commemoratives – Really the only laggards during the 5 year bull market, there’s finally some positive action in classic commemoratives.  These coins could be a contrarian play.

          *  Modern Coins in High Grade – Down double-digits this year and falling.  Don’t look for this to change.  See the warnings in prior coin updates.

The tone of the market is now much more positive than over the summer.  Time will tell whether recent softness is a pause in the coin bull market or a turning point.  Historically, the best bet is to continue accumulating the coins defined by our “Coins Worth Saving” criteria, found at http://www.coinsworthsaving.com/Coins_Worth_Saving.html.

 

Even after rising coin prices for the past 5-6 years, there are some coins that look like bargains.  The headlong rush into generic $10 and $20 gold and bullion coins has pulled money away from smaller gold denominations and rarer coins.  When nice examples are available, we’re still buying Type 1 Liberty $20’s (1850-1866), Carson City gold, rare gold in all denominations especially $5 and below, early type coins (1793-1838), key dates in all series, and selected classic gold and silver commemoratives.

 

What’s a Really Nice Coin Worth?

Would you ever pay more than the listed retail price for a coin?  Savvy dealers, collectors, and investors do it all the time.  A coin lacking eye appeal may be a poor bargain at below wholesale price; a coin with great eye appeal may be a steal at a price above full retail.  Price guides are based on average coins for the grade.  In fact, it could be argued that most transactions picked up by the price guides are for below average coins – because the really nice coins for the grade inevitably get locked up in collections for many years.  That’s why two coins certified in the same grade can sell for a price difference of 50% or even 100% in the same auction.

 

Feel free to contact us any time for more information on coin-related topics.

 

Coin Market Update
 (8/10/09)

 

Overview:

Summer is usually a quieter time in the coin market, and the summer of 2009 has been no exception.  Sales volumes for most dealers, as well as prices in general, have tended toward the soft side.  The big winner for the last three months was generic gold: common pre-1933 US gold coins.  Generic gold benefited from both increasing spot gold prices and expanding numismatic premiums.  Collector coins generally held their ground, while high dollar (over $15,000) coins remained soft.  Reflecting this, the CoinAge Price Averages show an average gain of about 2.9% year-to-date in collector coins (VF grade), with a loss of about 3.6% year-to-date in very high end coins (MS-65).

 

Looking back a full year, most coin indices are anywhere from even (CCDN wholesale price index) to down about 5% (PCGS CU3000 Index at www.pcgs.com).  The PCGS Generic Gold Index bucked the trend and is up 12.5% from a year ago.  PCGS reports that 26,000 individual coins have increased in value compared to 12,600 that have declined in the past year.  At least to this point, coins have certainly escaped the carnage that has ravaged other asset values.

 

What’s Hot: Generic gold leads the list.  Nearly all gold denominations have been strong, with the smaller denominations ($1, $2.50, $5) now joining the $10 and $20 gold coins in the move up.  Early 19^th century copper (half cents and cents) and better date liberty seated dollars have been strong.

What’s Not: High grade modern issues, high dollar ($15,000+) coins, most currency.  Lincoln cents have slipped a little after earlier strength.  Some key dates in popular collector series have been soft.  The $3 gold denomination has been a little soft following a multi-year run-up.

 

Looking Ahead:

Prices seem to be leveling out as we head into the fall.  Early reports from the bell weather ANA show in Los Angeles indicate some firming.  It’s too early to call an end to the softness in coin prices.  After muscling higher for seven plus years, the current pullback has been notably mild -  there may be more to come.  In addition, precious metals prices can be unpredictable and will affect the prices of some coins.

 

At Solid Rock Rarities LLC , we continue to buy nicer coins whenever the opportunity is presented.  Rare coins have increased in value by about 2800% since 1970.  They’re highly liquid, easy to store, and beautiful to behold.  We specialize in the coins that have historically increased in value: gold coins, early type coins, and key dates.  See our criteria for “coins worth saving” on our website at http://www.coinsworthsaving.com/Coins_Worth_Saving.html.

  

Coin Market Update
(5/1/09)

 

Overview:

Activity has slowed some in the early part of 2009, but most coin prices have held up well. In the first three months of 2009, approximately 35,000 US coins in the PCGS price guide moved up compared to about 8000 that lost value. A few coins priced over $15,000 have shown softness, as have coins with problems or poor eye appeal.  Gold coins continue to show strength, except a few priced above $25,000.  Less expensive “collector coins” have held their ground.  This is reflected in the major coin indices:

 

CCDN Coin Market Index (broad wholesale measure): Up about 0.3% year to date

CoinAge Magazine MS65 Index (high end): Down about 4% through March

CoinAge Magazine VF Index (lower end): Up about 0.4% through March

PCGS 3000 Index (broad measure):  Down 0.8% in the last 3 months

PCGS Generic Gold Coin Index (more common gold): Up 15% in the last 3 months

PCGS Mint State Rare Gold Coin Index (very high end):  Down about 6% in the last 3 months

 

What’s Hot: Early US coins minted before 1834; key date Indian and Lincoln cents; any but the most expensive gold coins; key date Morgan dollars

What’s Not: Specialty areas such as early gold commemoratives and Morgan VAMs; common date silver coins; high grade modern coins; some very high end (over $25,000) coins; most currency

 

What are the Best Gold Coins to Buy?:

The answer to this depends largely on your objectives.  Below are three general classes of gold coins and observations on each:

1. Bullion Coins (US Eagle, Canadian Maple Leaf, South African Krugerrands, etc.) – These modern coins are minted and sold for their gold content.  There is little or no numismatic value.  They track gold prices closely.  Bullion coins tend to do very well in periods of financial uncertainty and inflation.  Values have risen steadily for the last 6 years.  However, precious metals prices are notoriously cyclical and bullion coins have proven a poor “investment” over longer periods of time.  Bullion was confiscated by the US government in 1933.
2. Generic Gold Coins (common US gold coins minted pre-1933) – The value of these coins will be strongly influenced by precious metal prices, but also collector/investor demand.  They act as a sort of hybrid between bullion and numismatic coins.
3. Numismatic Gold Coins (Rarer or higher grade US gold coins minted pre-1933) – These coins can be influenced by gold prices, but trade mainly on collector/investor demand.  There is a limited supply and obviously they are no longer being minted.  This market is completely different from that of bullion coins.  Over longer periods of time (5+) years, numismatic coins have typically rewarded their owners, independent of what spot gold prices are doing.  See for instance the article at http://www.numismaster.com/ta/numis/Article.jsp?ad=article&ArticleId=5356

Bottom line: Generally, we would prefer to sell numismatic (or at least generic) coins to customers who plan to hold them for some years.  However, if you judge that an economic crisis is at hand or simply want to own bullion, we can supply bullion coins at competitive prices.  If your needs or your assessment of the financial climate change, bullion coins are easy to sell or trade for numismatic coins.

Feel free to contact us any time for more information on coin-related topics.

 

Coin Market Update
(1/27/09)

 

How’s the coin market doing?

The short answer is “a lot better than most markets”.  Coins selling for over $25,000 have softened some.  Off-quality (cleaned, scratched, undesirable toning) coins of all types are selling for less.  Better coins are not advancing as much in price, but are generally not losing value either.   Dealers in hard-hit parts of the country report reduced sales, but most coins are holding prices.

How are gold coins doing?

The market for gold coins continues to be very strong and prices have been increasing.  Even modern bullion coins, which normally have no numismatic value, are now selling for a significant premium over the value of their bullion content.  In the arena of collectible gold coins (pre-1933 U.S. gold coinage), some money has shifted from the smaller denominations ($1, $2.5, $5) to the larger denomination coins ($10, $20).

What’s hot?

In copper, half cents (1793-1829) and early cents (1793-1814) continue to advance in many grades.  Early silver half-dimes, dimes, quarters, half dollars, and dollars (1794-1838) show strength in selected grades.  Barber dimes (1892-1916), liberty seated dollars (1840-1873), and trade dollars (1873-1885) are also strong.  Early gold coins (1795-1839) enjoy insatiable demand.  Higher denomination gold coins ($10, $20) have advanced rapidly with gold prices, especially in the lower grades.  As noted, even modern bullion coins (American Eagles, Krugerrands, Maple Leafs) carry a significant premium over their inherent metal value.

What’s not?

Some of the higher priced ($25,000+) coins and virtually all off-quality coins have lost some value.  Early silver commemorative coins remain out of favor.  Mint sets and proof sets have been soft for some time.  Higher grades (MS-63, MS-64, MS-65) of smaller gold denominations ($1, $2.5, $5) have come down in price as many people moved to larger gold coins.  Modern coins (1933 and later) in very high grades have fallen in price.

What are some possible good buys right now?

·       IIf you can afford it, early U.S. gold (1795-1839) will forever be in short supply.  Ditto early U.S. silver (1794-1839), especially dollars.  These coins ARE America.

       If you ever wanted to own $1, $2.5, $5 gold Liberty or Indian coins in higher uncirculated grades (MS-63) an above), now is your chance.  Seldom do I recommend "generic" or common date gold, but beautiful examples in higher uncirculated grades are bargains in these lower denominations.

      Key dates in all popularly collected series have consistently rewarded their owners.  Especially attractive right now are key date Lincoln cents (1909-S VDB, 1914-D, 1922 No D), as release of the new 2009 Lincoln cent reverse designs is likely to kindle demand for the oldies.

      My perennial favorite: $3 gold coins, which are rare in all grades and needed for gold type sets.  Another solid choice in all seasons is Carson City gold($5, $10, $20).

      Nicer liberty seated dollars (1840-1873) and trade dollars (1873-1885) are advancing for a reason - they are much rarer than generally recognized.  They could continue to advance.

      What is best to avoid?

      Any coin that relies solely on metal content for its value, i.e. bullion coins.  The exception is if you want to hold precious metals in case of financial market panic or failure.  Even then, U.S. commemorative gold coins or circulated pre-1933 U.S. gold may be a better bet.

      Modern coins (1933 and later) in very high grades.  Their populations will inevitably increase as more are certified.

      Bargains on off-quality coins.  You'll find yourself liking them less over time, and who will want to by them when you do get ready to sell?