By Doug Winter – Raregoldcoins.com

If you are like most people, the last few months have been tough on your pocketbook let alone your psyche. We are, at least for the immediate future, in tough economic times. For some people, there are difficult decisions that have to be made: which bills get taken care of, can the mortgage be paid, do we eat dinner or fill the tank with gas. Fortunately most coin collectors are faced with decisions that are much less dramatic.

When people are feeling wealthy, spending discretionary income on something like coins is a no-brainer. You see something you like and you buy it. In a Recession, such purchases become far less impulsive. But I don’t think the coin market is going to come to a screaming halt. Prices may come down (in some cases they may actually raise) but I sense that there will be activity. Simply put, there are just too many people who enjoy numismatics and there is just too much money (in the United States and world-wide) for established hobbies like numismatics to crash. And, if we enter an inflationary period as many experts believe, there could easily be a rush into tangible assets.

That said, I think people’s buying habits will change quite a bit in the next few years. The Irrational Exuberance we saw in the middle part of the decade could be over forever. As someone who has survived a number of lean Numismatic Cycles, I’d like to share some observations on how you can still add coins to your collection, even in tough times.

1. Buy Smart. I can’t begin to tell you the number of purchases I saw in the last few years that were just plain dumb. Collectors battling to the death at auction over coins that weren’t really that nice or rare. Dealers falling all over themselves to buy old holder coins in one grade and paying a price that assured them they would possibly break even if the coin upgraded three points…sheesh!

Being a smart coin buyer means being informed, confident and well-connected. In my opinion, this means taking the time to carefully research the coins that you are contemplating buying, fully understanding the buying and selling process(es) and having a good relationship with a small group of dealers.

I am a huge believer in first impressions being correct. In numismatics, this means having a good feeling about a coin’s appearance, a coin’s price and the person who is selling it. If you have to convince yourself that you like a coin, don’t buy it. If you have to make irrational justifications about a coin’s price, pass. If the person who is selling the coin makes your skin crawl, have a trusted dealer make the transaction for you—or shop somewhere else. (more…)

Market Report by Laura Sperber – Legend Numismatics

With all the turmoil in the financial markets you would think the rare coin market would be on its death bed. NOT! Without a doubt, even though we have been harping the coin market has been going through what we will call a “quality correction” of 10-20% (probably more like 30-40% now), nice, fresh, original, and truly rare coins have NOT decreased in value by any noticeable measure. Do note: you MUST have FULL quality and TRUE rarity to be safe. People do still need to sell and raise money, but for every person who had to sell, we seem to have found a buyer.

While we have had millions of dollars worth of surprisingly great coins sold to us in the past 30 days, we have also SOLD millions of dollars as well. The 1893S PCGS MS67 Veremule piece came to us not out of financial desperation, but because the owner had personal issues. We wired the money. The coin was sold instantly to the first collector we mentioned it to. He had no fear of spending over $1,000,000.00 and fully understood that he had the opportunity of a life time to acquire the piece. In fact he did not understand why a person that has “passion” and money why they wouldn’t be aggressive buyers today.

We told everyone in our last report to watch the Heritage Auction results. With one day to go, we thought things were going to be very bleak (the sell through at that point looked very weak). However, sitting in the office watching the bidding live and coin by coin being outbid, we saw strong signs of stability. From what we understand, the sell through was over 80%. Many coins that did not sell were (of course) over reserved dealer retreads or, they were “off” quality pieces.

For a better understanding, lets compare two coins from that sale. Lot 256. 1864 Small Motto PCGS MS65RD CAC. Sold: $21,850.00. Lot: 1197 1880S $1 PCGS MS68 CAC. Not sold. The 1864 was a monster. Its reserve was either low or none. The coin blew away ALL records for an MS65 RD when bidding closed! We also believe there was highly aggressive multiple bidders. The 1880S was a monster also. BUT, it had a reserve of $6,000.00 (or a total price of $6,900.00). You can buy a VERY nice high end GEM MS68 for $4,500-$5,000.00 these days. Plus, even in high grade, its still a widget. Did these come down? Yes and no. The reserve probably was based on people spending freely in a rising market. Now that the music has slowed, people demand value for their dollar. They do not seem to be paying multiples for commoner coins either. However, when a coin like the 1864 pops up, their is still a frenzy of bidding. If the market were truly declining, the 1864 would not have sold for what it did. (more…)

By Doug Winter – RareGoldCoins.com

To paraphrase that esteemed numismatist Mark Twain, the reports of the death of the coin market seem greatly exaggerated. That is, at least, if you take a look at the prices that Heritage got for a nearly complete set of Liberty Head double eagles that was sold at their Dallas auction on October 24.

As anyone who even remotely follows the dated gold market knows, Liberty Head double eagles have been one of the most solid performers in the coin market during the bull market run-up of the past few years. This market has proven to have more depth than I would have ever imagined and there are, clearly, more advanced collectors assembling comprehensive specialized sets of these coins than in probably any other area of the 19th century gold market.

The question I was asking myself a few days ago, though, was: would these collectors still play in this market after the Economic Malaise of the past month? The Type One, Type Two and Type Three sets are full of many big, macho “stoppers” and I was very interested to see how these coins would do.

The two key collectible Type One double eagles are the 1854-O and the 1856-O. These have appreciated in value more than virtually any other United States gold coin in the last five to seven years and, certainly, the New Market wouldn’t be able to continue its frantic pace when it came to these two issues, would it? The 1854-O in the sale was a PCGS AU55 and it sold for $603,750 which is an all-time auction record for the date. The 1856-O was graded AU58 by NGC. I thought it was comparable in quality and appearance to the PCGS AU55 example that I had sold earlier this year and the Heritage coin brought $576,150 which is the second highest price ever at auction for this rarity. (more…)