By Laura Sperber of Legend Numismatics

Legend did not meet our sales target, but we still managed to do very well. Wholesale was clearly stronger than retail at this show. We must point out, Cincinnati has never been a huge coin town. Sure there are a few collectors who live there (at least three of them we deal with or know of have world class collections and own at least one coin valued over $1 million dollars) but there is no serious group who can fill even 10% of the floor. Plus, the show was not easy for anyone to get to. There were only limited flights (we had to take a 6 AM flight) and they fly regional jets which limits what a dealer can bring. So attendance was not strong. Several major dealers also skipped the show because of sales tax issues.

We came to the show with some gold-and of course sold it all immediately. The usual “crackout” dealers were scrambling for first shot-but due to the new world order (the grading services were holding the line hard), they would only even consider a coin that had at least a 90% shot to upgrade (yeah they wanted “lock” upgrades-imagine that). They used to buy coins if they had even a 10% shot. Since the grading services got tighter, the middle layer of WHOLESALE dealers have dramatically cut down their buying.

Those dealers buying for Want Lists (like us) were extremely frustrated.

Unlike many other dealers, we expected this show to be weak. Historically, it is always a strong show, but we felt there were many factors in place to make it what we think will be the low point of the year.

DOES ANYONE NOT HAVE RETREADS FOR SALE???

Nice fresh coins are clearly still selling and are bringing super strong money. The biggest problem-actually our biggest problem, nice coins can NOT be replaced and we do not see any where enough of them to make money with.

All we saw on the floor were the same coins we have seen at the last few shows. We saw one small fresh group of quarter eagles sell WHOLESALE and that was it. We are very much “in the loop”, so its not that the stuff was there and we didn’t get offered any.

THIS WAS LEGENDS WORST BUYING SHOW EVER! We are talking about BOTH buying on the floor and from the auction. On the floor, we spent just $68,000.00 (at least years CSNS we spent $1 million). After the first walk around, we knew we were doomed. And for the auction, lets just say we only bought a small fraction of what we normally would for a sale of that size. Fortunately, we were able to buy some fresh deals back home before we even left for the show.

Bad coins are still lingering all over. These coins are now dragging down the good coins and the entire market. Until either these coins get bought back by the grading services or they get so cheap they have to leave the market this problem will exist. We said before the off quality coins are down by at least 60%. At this show, they clearly took another bump down (we’d guess they are now fully off by 65-75%). In most cases, dealers wouldn’t even make offers.

The positive to all this is the good coins are in strong hands. So at some point, prices MUST go up (after the junk is gone).

THE HERITAGE SALE

The most famous highlight was the purchase by our good friend John Albanese of the famous 1804 $1 for $2,300,000.00 (Ex Amon Carter and Phil Flannagan-Legend). We know for a fact he did not have the coin sold when he purchased it. Of course this made heavy national news.

All along we considered this a retread sale. The majority of coins were purchased by the biggest consignor over the past 2-3 years. We still remember bidding on some of them. It was hard for us or many other dealers we know to get excited. Still overall, Heritage did an outstanding job of promoting and marketing the sale and helped the consignor face a only small loss.

Some people (dealers included) thought they were getting bargains because many of the coins sold for BELOW what the consignor had paid. That does NOT mean a coin is bargain. We bought the famous 1941S PCGS MS67 that sold for close to $90,000.00 in an auction about a year and half ago. We paid $27,600.00 for the coin. Does that mean its a steal? NO! It means the person who bought it paid way too much (remember, the past two years investors started to pour in and sent the market up like a rocket ship). What about the under-bidders from that sale? Obviously they have moved on and can not be counted on to buy this coin. We can’t see this coin being resold for even half of what it brought originally. To us, its worth what we paid and that’s it.

The clearly fresh and great coins did exceptionally well. Here are two that stand out. BOTH inspired major bidding wars.

20C 1875CC NGC MS67 $80,500.00
$1 1934D PCGS MS67 $86,250.00

On the other hand, the 5C 1918/7 PCGS MS65 was apparently abandoned by a major phone bidder allowing it to sell for $230,000.00 vs the $350,000.00 the seller paid a year ago.

Overall, the auction had a huge sell through at very decent money-something that is critical for market watchers to note. You really have to be VERY careful in how you interpret the results from this sale. Unless you saw the quality of each coin, do not make assumptions.

OUR COMMENTS ABOUT GOLD

Sure, we see the big money players buying gold and we tell you about them. Then sure as can be, BAMM! Gold falls and generics take a moderate hit (about 10%). We still stand by our previous comments that the really sharp Wall Street players and general “smart money” people have and are still buying gold. We ourselves are still bullish on gold. You can only buy this commodity (in any form) knowing there will always be tremendous risk.

THE WEEKS AHEAD

We are fully convinced the CSNS Show was the weak point of the market. We cannot really see prices for inferior coins going down much more. They have hit the point dealers will not even make offers. We believe now these coins have to leave the market. We predict the public will wake up overnight and one day realize there are NO fresh, nice, and really eye appealing coins available. At that point, prices have to go up. Remember, the government printed trillions of dollars an also borrowed more than ever. At sometime, someone has to pay for all that. Watch gold, this price drop may just very well be a hiccup. Ditto for all hard assets and collectibles.

The next major show is Long Beach at the end of the month. Due to the fact it has been a slowly dying show we do not expect much. In between, we do expect to see collectors thawing out from winter and starting to buy again at the new levels (it takes a while for the real skeptics to believe prices are back to where they should be).

The market in general is slower, but is NOT dead. Get us the right coins and we can sell $10,000,000.00 right now. That’s the ONLY thing hurting us today.

WHATS HOT?

Even though generics came down, gold was still the strongest point in the market. Bust coins. Proof Gold.

WHATS NOT?

ANY INFERIOR COINS. Lincoln 1C. All PR/MS 67/68 Type.

Related posts:

1. THE SPRING CSNS SHOW – Legend Numismatics Market report
2. Legend Market Report: The 2009 Los Angeles ANA Coin Show
3. THE 2009 SUMMER LONG BEACH SHOW – Legend Market Report
4. Legend Numismatics Baltimore Spring Show 2008 Market Report
5. THE BALTIMORE SUMMER SHOW – Legend Market Report
6. Legend Market Report – Sept. 08 Long Beach Show
7. THE FUN SHOW 2008 – Legend Numismatic Market Report
8. Legend Numismatics Baltimore Coin Show Market Report
9. Legend Numismatics Market Report: The Fun Show
10. The Long Beach Show – Legend’s Market Report Feb 2009