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The Perfect Auctions-The Holmes And Nafzger Large Cent Sales

By Laura Sperber – Legend Numismatics

“The perfect auctions” we are talking about are the Dan Holmes and Ted Nazfger Large Cent auctions that just took place in Beverly Hills. Ira and Larry Goldberg (and staffs) did a spectacular job of organizing and auctioning these once in a life time sales.

ln_market_090909The results from these two sales let no one down-they were phenomenal and totally mind blowing! Prices realized and collector participation more than proved the coin market is starved for quality and has very strong and deep legs.

Last time we wrote about the middle date Nafzger Sale, we named it “the perfect storm”. We knew the coin that auction had sold ridiculously cheap and time would prove it out. The reasons why that sale had weaker results: the sale was held the same day (during) the Super bowl, the Goldberg’s Internet site crashed, the economy was seriously more uncertain than it is today, and a few new collectors to the series had just started. Its totally amazing how all these factors did a total reversal to yield some of the most amazing results ever and produce two greatly historical auctions.

THE DAN HOLMES SALE

The crowd was standing room only and was comprised mostly of serious collectors. There wasn’t just a buzz before the sale began, you could feel and jolt of electricity when you walked in the room. From our point of view we did not see the typical “crack out and coin docs” we run into at every show. Thank goodness they do not know how to work on anything than other than a white dollar or a gold coin. In fact, very few “main line” dealers like us attended.

It was a battle every lot to buy anything. The room was littered with deep pocketed individuals who came to buy. In the end, we witnessed at least FOUR collectors who spent OVER $1,000,000.00 each and several under bidders who had tried to do the same. Legend spent a lowly $300,000.00 for ourselves, and teamed up with a another dealer to buy another $600,000.00 worth of treasures. There were many “unknown” faces who came out of hiding for this sale and they were as aggressive as someone you’d see who attends every show and auction.

The very first coin of the sale set the dramatic tone. It was a stunning GEM PCGS AU58 Chain Ameri. We wanted to bid $250,000.00 hammer and really felt we had a chance. All we could do was feel the breeze as countless hands zoomed up in the air and within seconds pushed the coin to a dizzying $368,000.00 total! At that point were were nervous that all the work we put into the sale would be a complete waste. Next thing we knew, some how we purchased both PCGS MS63 Chain Cents and the Weath Cent PCGS MS65BN with a partner. That would be the end of our shopping spree until the very end of the sale when we purchased the 1811 PCGS MS66 RB. No matter how high we bid on the really cool coins (like the 1802 1C which we bid $275,000.00 and it sold for $333,500.00) we were never the winners. Still, it was a ‘rush” to participate and even more fun to watch.

THE 1795 REEDED EDGE CENT PCGS VG10

Our ignorance of early copper really showed on this coin (please don’t quiz us on Sheldon numbers). Until the day of the sale, we did not realize it was a J-20 and is considered a pattern. Fortunately for us, our pattern customer is not a fan of early copper and is even less of a fan of low grade coins. Had we agreed to bid on it, the price of this coin would have been subantially more than the staggering $1,320,000.00 it sold for! Among serious students of the series, this coin is considered the “secret key and holy grail” to the series. Not surprising to us was that there were several collectors still bidding on the coin up to $800,000.00. Our good friend Tony Terranova had sold the coin to Dan Holmes many years ago and badly wanted to buy it back for his personal collection. Alas, Tony stretched to $1,050,000.00 hammer and was outbid by a dealer representing a very deep pocketed collector who is building one of the most complete collections possible. Guess that means we get some free lunches to soothe his pain since he has some extra money to still spend! On a serious note, once this coin sold it was off to the races with prices.

Most collectors have a fantasy about putting their coins in auction and having two people run the prices up to the moon. In this sale, Dan Holmes had the ultimate fantasy, there were at least 4 or 5 serious bidders on almost every lot up until the hammer was dropped! Values certainly were not being determined by any ridiculous printed prices (how stupid it is to see printed prices on coins that rarely trade). Collectors were determining the coins values by using their knowledge, their deep pockets, having no fear, and showing incredible desires to own these coins. While it was nirvana for the early copper crowd, it was a grueling 10 hour torture-fest for us since we had to buy coins we could resell for a profit. In the end, the entire experience was truly refreshing. If we had to say a number, it is our estimate that at least 90% of all of the Dan Holmes coins are now in new collections-not with dealers.

THE NAFZGER SALE OF LATE DATE LARGE CENTS

Deep down we are secret “copper weenies’ at heart. GEM ORIGINAL early copper has always been one of out favorite areas. Ever since Eric Striener sold the early pieces from the Nafzger Collection about 20 years ago, we have always been huge fans of ALL coins that carry the Nafzger pedigree. We have never seen a Nafzger coin we really did not like.

Just like the Eliasberg Collection, the Nafzger Collection will never be duplicated. The overall assemblage of monster quality and true classic rarities in the set really defy the laws of gravity! So many of the coins do not even deserve to exist, yet there they are after a hundred years or so sprakling like they just were minted. No matter how deep pocketed a collector is, today its impossible for anyone to reassemble this collection.

Ever since we were told the late dates would be sold we were licking our chops and were excited. Deep down we were hoping another “perfect storm” would happen. It was not to be. So we devised a simple strategy; buy as many of the best coins as possible where the populations and prices seemed to correspond. At the time, we thought coins would be buyable at 3-5X their estimates. We must have been on top of Mt Everest with out oxygen when we did that genius thinking.

The auction actually started out okay. The first lot we wanted was lot 601 the 1840 PCGS MS65RB. Some how we calculated it would cost us $15,000.00 hammer. When multiple bidders were all around and with frustration of losing on so many coins the prior night set in, we decided that this was going to be our only chance to acquire these incredible GEMS and we needed to “go for it”. Fortunately, the coin was hammered down at $17,000.00-only $2,000.00 over our original figure. From that point on we refined our strategy to be more aggressive on the coins we really wanted. The numbers we had written in our book had become doodles. In the end we surprised ourselves and bought more than a dozen of the highest graded pieces in the collection. It wasn’t as many as we had hoped for, but this time, at least we bought more than 3 coins!

Many collectors ask us how we figure prices in sale like this (when no similar coins have ever sold). There are no real pricing guides. Since there are no more Nafzger sales to happen, we’ll share our buying methods: first and most important, we determine the coins quality. If the coin is so freakin unbelievable and we have never seen anything remotely close, all the numbers become insignificant. We check if the coin is a rarer variety and try to avoid it if it is more than an R-4. Next we scour our special software to see if anything remotely is close to the coin and when it traded and for how much. We also determine if any of our customers could possibly need the coin and what their comfort level might be. Last, we add it all together and end up going by out “gut” senses. So when the 1848 PCGS MS65RD was coming up for sale, we knew by the tone of the auction up to that point, the $20,000.00 ($23,000.00 total) written in our book wouldn’t make us the new owners. We happily paid $25,300.00. Was a higher price ridiculous? NO! PCGS has no other GEM RD coins graded and you hardly ever see them for the type. Plus, the coin is true monster. Most likely a better coin does not exist. We also pondered what if the coin were silver? If it were a Quarter or higher denomination in MS67-it would be worth a fortune.

THE 1852 PCGS MS65 CENT-LOT 1134

Paying crazy money for a true “wonder GEM” can be a much smarter move than you realize. We considered this coin to be the FINEST MS65RD 1850’s example in the Nafzger Collection AND to rank as possibly the FINEST MS65RD from that era that exists. The coin is a jaw dropping incredible monster. The color is a pristine GEM RD. PCGS did it no favors by calling it only an MS65 (they were obviously breathing that same mountain air as us). Up until the very last increment, SEVERAL collectors fought for that coin. We knew a customer of ours was bidding on it so we took ourselves out of the equation, however had we been able to bid we’d have begun choking at $10,000.00 hammer but would have carried on. The collector who bought it also deals with us and we knew by the look in his eyes he was going to pay whatever it took to be its owner. Keep in mind, nice RD specimens sell for $7-$8,000.00. This coin was far from average! Its one of those coins anyone who saw it will never forget. It really did not matter what grade holder the coin was in. We equate the stratospheric price of this coin to another we know well-the $10 1920S PCGS MS67 which we bought two years ago for $1,725,000.00. Everyone had laughed at Dr Steven Duckor for paying an insane $75,000.00 for it when the average $10 Indian was worth just hundreds in GEM over 20+ years ago. We can give numerous examples in numismatic history where instances like these have yielded amazing results. The main point here, do not be afraid of overpaying on a wonder coin! Most of the time, that is the ONLY way you will ever get to own it.

THE COIN WORLD OUTSIDE OF THESE AUCTIONS

These sales are NOT aberrations in the market. They offered coins that a starved market lacked and desperately wanted: fresh, stunning, and exceedingly rare ORIGINAL GEMs. These weren’t just coins in holders or another piece of plastic in a phony number one registry set. These coins really are priceless treasures that have not been on the market for as long as 50 years. Also, they are coins from a different era. Collectors ruled back then, not crack out or coin doctors.

We strongly believe that as the word of these two sales incredible results spreads, it will even further boost collector confidence. Plus, they will help educate and hopefully inspire the newer collectors to pursue great coins. We know BOTH sales reinvigorated us!

As we mentioned in the last Market Report, after ANA things slow up until about mid September. This time it looks like the market will reawaken with a blast due to gold being over $1,000.00 and the huge positive effect these sales will have. We do not see rapid upward price movements happening. The investors and speculators (and dealer wannabes) are back in their caves all hiding. The biggest problem is still that severe lack of nice fresh material. We definately see a serious firming up occuring. So long as the ills of previous years are being remedied, the prices of truely great coins like the ones in the Nafzger Sale will only continue to rise. With each major event, the market is looking better and better.

We will be back next week with a full market update about the Long Beach Show.

About the Author

Laura Sperber is one of the Owners of Legend Numismatics. She is a passionate and outspoken dealer who says what she believes and is a strong proponent of numismatic standards. Since 1987. Legend Numismatics has built an unequaled reputation among casual collectors and avid investors alike by locating and procuring top quality rare coins.

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