By Laura Sperber - Legend Numismatics

We’re back! What a long and completely exhausting week. Hate to sound negative, but this was not our best FUN Show-or even close. For us, we rate the show as weak. Retail was slow. Wholesale for what we had was very strong (still well off record numbers). Buying was so difficult that we started to look in areas we normally do NOT handle. We had expected a block buster show especially since gold rallied to $900.00 an ounce. We just couldn’t muster up any fresh deals on the floor or find pockets of coins to buy to make things happen.

From our view point, much of the activity occurred at the auctions. For the first time probably in 30 years, we pronounce the FUN show as being disappointing to us.

WHEN AUCTIONS RULED

ALL of the major activity clearly took place at the auctions. The PRE FUN sales were as crazy and challenging as they could be. The quality was mixed while the offerings were weak. It was difficult to calculate whether or not to be aggressive on prices paid or wait and see. The Stacks sale just about killed us when we were representing our Pattern customer while pursuing a very rare copper Gobrecht (2 known). We figured we’d blow everyone out of the water with a $300,000.00 bid. Nope, in the end, WE got blown out of the water by a $460,000.00 HAMMER bid! That was only a hint of things to come! NOTE: Many people were shocked at the price the Gobrecht sold for. We later reasoned it may not have been such a monster price after all. With serious money floating around the market, its $500,000.00 really a lot of a coin of this size and rarity (we were told the buyer was a long time collector of the series-not some new interent buyer)?

Our favorite purchase by far were the five out of this world ring gold dollar patterns from Superior. We made up our minds no one was going to out bid us on those! After that, our next favorite purchase was the 1839O 10C PCGS MS67 we bought out of B+M. At Heritage we actually tried to buy a coin or two for our personal collections-and sadly got shut out (which is an extreme rarity). We have always been mega aggressive on coins we know are special and that can NOT be replaced.

The Heritage sale was nothing less than insane. The sale clearly redefined the marketplace. They had a fabulous sale with many rare and TRUE quality pieces. Since they have such a huge Internet presence and obviously have tapped collectors from other markets, it was easy to see why an 1805 25C NGC MS66 sold for $325,000.00 in a wild bidding contest. Platinum Night alone saw over $40,000,000.00 change hands. We saw many long time top buyers shut out. Our success rate there was decent, but no where near what we had hoped. For the record, Legend did NOT buy the 1796 No Stars for $1,500,000.00. We do know the buyer, and all we can say is that person wants to buy coins-a lot of coins!

Few collectors or dealers will argue that for FUN 2008, the floor was bone dry and if you wanted to buy really cool or special pieces you had to buy in the auctions. With auctions being a competitive arena, it was only fitting that record prices were being realized with just about every lot. We spent about $3,000,000.00 in all the auctions combined (well off out $6 million dollar record of 2 years ago).

Our last comment about the auctions: While auctions are the ultimate “rush”, they are also dangerous. NEVER buy ANY expensive coin without seeing it. Always remember that the auction house is out to do the job for the consignor. We saw so many people pay ridiculous prices for the WRONG coins we had to laugh. Yes it IS self-serving for us to to tell you that you should have a dealer represent you-but paying 5% and buying a coin right is much cheaper than getting buried in bad coin. And sometimes your best buy, is when you don’t buy at all.

THE SHOW TRAFFIC

Unless we were just in a bad location, we thought the turn out of the collecting public was lighter than usual. We saw many old friends, but we didn’t see all the “regulars”. We do not believe this was due to the fear of crime from the past shows. Since early last year, attendance at most shows seems to be decreasing. The Internet seems to be emerging as the new choice for coin buying.

COIN PRICES

The amount of new money coming into coins is staggering. We know of two groups who are mandated to spend at least $50,000,000.00 EACH this year (no they are NOT companies). We witnessed one of the buyers for a FUND being very aggressive at the Heritage auction only to lose out to wealthy collectors who were then forced to pay stratospheric record prices. The amount of money available to buy coins right now FAR outstrips the available supply (at least in the higher dollar value areas). The show was a great selling place if you had the “right” coins. Currently, our inventory is the smallest it has been in 3 years. We can’t out bid wealthy to collectors just to maintain an inventory! Unlike 3-4 years ago, we can’t go to show and have any kind of real selection to choose from. Now, if we blink, we lose a coin and nothing comes around to replace the offering.

Get used to seeing record prices-especially in auctions. We can’t stress enough that even if you think your paying a strong premium at a show it will still be cheaper than what you’d have to buy the same coin for at auction. Go read many of the FUN Show Market reports dealers put out. Most will probably be crowing how you could have bought a coin cheaper than what it went for in auction.

With coins not out there prices WILL continue to move up. We will step up and tell you that TRUE Rarities that are PROPERLY graded WILL rise in value as much as double in 2008. No, we’re not hyping things. We know who is biying and how much they are spending. Do note, that not every coin will move up. If a coin is 95% of the quality, forget it-it will have no premium and probably will need to be discounted.

The only thing really holding back price rises across the board-the use of published bids. Keep in mind, they are BEHIND-way behind. Plus, they do not take into account a coins quality. Most publications also only report prices on coins that trade. If a coin only comes around once a year, the “sheet” buyer will probably never own it due to lack of proper pricing information. We can’t tell you how many times we have seen collectors miss an extreme rarity because of this. Your best bet to figure out where the market really is, is to watch the auctions, but discount the frenzy a bit.

CAC

We expected to CAC to be a success, but we were greatly surprised at market demand for the product. Just go to the Heritage auction, you will see CAC coins brought significant premiums. The biggest current demand for CAC coins are in Saints and Dollars-two of the most gradeflation hit areas. Submissions are extremely strong (you’d be surprised how many dealers are submitting-especially their personal coins). While some collectors maybe skeptics, the general collecting public clearly welcomes the second opinion.

Several major players (including ourselves, Blanchard, and Swiss America) have committed to only handle CAC stickered coins from this point on. Sure, we know how to grade very well, but we this as a protecting for others down the road who might own the coins but can’t grade like we can. We certainly are NOT insulted when a customer now tells us they will only buy CAC stcikered coins.

Even if CAC did not exist, Legend promises to always present you with properly graded high end quality coins. We believe if you are spending significant money on a coin-it better be all there and then some. We pass up many coins that others write up as “PQ”. Eye appeal and quality ARE everything when you buy top end coins. There is no cutting corners.

WELCOME TO 2008!

Even though it didn’t start off as a blockbuster, we do expect huge price advances and lots of activity in 2008. It seems the market has simply shifted away from shows to the Internet and private transactions. We still see great coins selling immediately when they show up. And the supply of great coins-its almost non existent! The coin collecting public seems to now be filled with very strong holding powered collectors. This will be some ride in 2008!

WHATS HOT

Any major high grade rarity! TYPE, early copper, GOLD, even Patterns are strong and we predict will only get stronger in 2008 (see below). High grade GEM BETTER MORGANS are showing life as well as the ever popular CC’s. Probably the BEST buys on the market right now: CLASSIC RARITIES. Bust material really came alive at the show.

WHATS NOT HOT

Poor Commems. Time to just melt the series. Walkers and Mercs seemed a bit quiet.

THE PATTERN MARKET

We have been reading and hearing a lot about the Pattern Market ever since our $30+ Million dollar deal late last year. We’d like everyone to know that indeed we have decided to be come serious market makers/dealers in Patterns. It is one of the last true overlooked areas in numismatics. We never would have recommended to our biggest customer to buy that collection had we not felt so strongly about the potential of the Pattern Market.

Even at the FUN Show, many collectors approached us about starting some Type of set. The different sets that can be built are endless. Plus, Patterns prices overall have done little in the past few years. Sure we have heard the old time collectors complain about waking people up, but why shouldn’t the world know you can buy coins like rare PR FE Patterns for 1/3 LESS than regular issue ones? Or that you can still buy MANY R-7 pieces in GEM for BELOW $10,000.00. The only thing we see as holding the public bad-is the pricing guides being out of date or useless. We are working to change that and create a more stable market. We LOVE the many different designs and the fact we can handle coins that -”could have been”.