Comparisons of the Current Coin Market
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For those that were actively collecting, how does the state of the current market compare to that of 1980 and 1990?

 

In the economic, technical/market grading, social aspects.or all? I don't think 80 would be a comparative to use though. Maybe 70 or 75 would eliminate the horror of 80.

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I was collecting in 1980 but don't remember the crash. Obviously coins were raw then and I was buying material from an honest local dealer so wouldn't have known if I was hurt. I was able to purchase unc Barber coins for my twentieth century type set that would probably go MS 64 today. Wish I'd kept them. It does seem like many more coins are available today given all the different venues for collectors. It would be interesting to see a comparison of coin values tied to inflation.

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For those that were actively collecting, how does the state of the current market compare to that of 1980 and 1990?

 

Before or after the crash of 1980?

 

Both, and to answer John's question, from a financial perspective.

 

 

Prior to the crash of 1980, there was optimism, exuberance and many runaway prices. Right afterwards and for a few years (?) thereafter, the market was dead. Many owners of coins - collectors, as well as dealers - were deeply buried in them, there were few buyers and essentially no liquidity. Back then, there weren't even any (very low) sight-unseen bids to hit.

 

And then there was the crazy market of 1989-90, which I remember much better and in which I participated to a much greater extent. Prices were seemingly rising on a weekly, if not daily basis.

 

By then, NGC and PCGS were well established and sight-unseen trading, even for rare and valuable - not just generic - coins was heavy. I remember arriving at a major show with a box or two of classic silver coins mmmemoratives (which were already trading at astronomically high prices) and selling them to a dealer-friend for - I think it was - 30% over bid. I offered, but he wasn't even interested in looking at them first. Maybe I gave them away? ;)

 

As I recall, in those markets - before they crashed - it was far easier to do substantial sight-seen and sight-unseen business and make money than it is these days.

Edited by MarkFeld
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Thank you everyone. As for today's market, is it comparable to the market during/after the crash of 1980 and 1990? In other words, if this is like the previous crashes, are we at the bottom and how long before things move upwards if history repeats itself?

Edited by coinman_23885
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Thank you everyone. As for today's market, is it comparable to the market during/after the crash of 1980 and 1990? In other words, if this is like the previous crashes, are we at the bottom and how long before things move upwards if history repeats itself?

 

My understanding from reading historical accounts is that the crashes of 80 and 90 followed large bubbles. The economics of a bubble market are quite fascinating - but we haven't had an industry-wide bubble similar to those in numismatics since then. There have been ups and downs (the State quarter frenzy at the beginning of this millenium produced a heated market, but I wouldn't call it a bubble). The market right now is simply in the downturn of a regular cyclical market.

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Thank you everyone. As for today's market, is it comparable to the market during/after the crash of 1980 and 1990? In other words, if this is like the previous crashes, are we at the bottom and how long before things move upwards if history repeats itself?

 

My recollection is that the current market is considerably more active and liquid than those that followed the two crashes being discussed.

 

 

If you're looking to see what might happen if history is to repeat itself, I don't think the current downturn or the bull market which preceeded it represent an apples to apples comparison with 1980 and 1989-90.

Edited by MarkFeld
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I agree with what Mark Feld wrote. My paternal grandmother was actively buying coins in the late 1970's, and my recollection of prices she paid, even for generics like gem BU 1881S Morgan dollars, still makes my head spin. There was too much uninformed investor money in the coin market at that time. Buyers mostly did not have accurate perceptions of what was rare and what was common.

 

The release of population data from TPGs and the rise of the internet was quite revealing, and caused me to dump my 20th century U.S. coins and turn to 18th-19th-century material.

 

The internet in particular has changed the coin marketplace so much that I don't think that attempts to compare 2017 with 1980 or 1989-90 are useful.

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For those that were actively collecting, how does the state of the current market compare to that of 1980 and 1990?

The 1980 market was largely a result of the crash of the underlying bullion markets. Gold fell from $850 to $375 in a few months; silver went from $50 to $12. Anything leveraged to the gold/silver price went down huge. I believe some Saints went down 75% in price and many Morgan Silver Dollars (MSDs) fell 80-90%.

The 1990 market was driven by expectations that hundreds of millions would be moving into the numismatic arena on behalf of Wall Street investment funds. This caused a multi-month stampede into an already hot market: gold had recovered after the 1987 Crash and many people were wary of stocks and real estate. Money flowed into MS-65 coins causing a 500-700% premium for many Saints to the underlying gold. MSDs doubled or tripled in a few months; quadrupled or quintupled over a year or so.

 

It was alot like the Tech Boom of 1999-2000 back for coins in 1989-90.

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Thank you everyone. As for today's market, is it comparable to the market during/after the crash of 1980 and 1990? In other words, if this is like the previous crashes, are we at the bottom and how long before things move upwards if history repeats itself?

 

I don't think it compares to either by a long shot. I'm not a coin expert, but those time periods a few years after you were burning off the excess of 2 bubbles. The commodity bubble of the 1970's took a decade to recover from (interest rates and inflation collapsed; stocks rose) and the Coin Bubble of 1989-90 also took over a decade to wear off.

 

You could make the case that we were STILL burning off the excess in the 2000's because even though gold went up 6-fold from trough-to-peak the rise in Saints and other coins that got ahead of themselves was much less. I have posted charts on this before, I'll try and find them again.

 

Coinman, here's a Thread I started and I think I have some charts in it but check the last page for info on Kidder/Merril Lynch:

 

http://boards.collectors-society.com/ubbthreads.php?ubb=showflat&Number=7435760&fpart=5

 

Burton Blumert had a following in the 1980's and 1990's (like Howard Ruff in the 1970's) and is worth reading:

 

http://www.nationalsilverdollarroundtable.org/the-market-crash-of-%E2%80%9890/

Edited by GoldFinger1969
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My understanding from reading historical accounts is that the crashes of 80 and 90 followed large bubbles. The economics of a bubble market are quite fascinating - but we haven't had an industry-wide bubble similar to those in numismatics since then. There have been ups and downs (the State quarter frenzy at the beginning of this millenium produced a heated market, but I wouldn't call it a bubble). The market right now is simply in the downturn of a regular cyclical market.

Agree 100%.

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Current Market on southward side of steady for quite awhile is my impression. The PCGS 3000 index validates this as I track it. Not sure if NGC keeps their own. Gold and Silver Bullion material has been outperforming numismatic coins in the short term. I do think numismatic coins strong but just don't know where they are going from here - any seers out there? I'm still lost in the trees.

 

Many have their opinions based on various reasons some self serving. When I see coins plusing 10% every week in the bids I will believe we are in an up market. This market reminds me a lot of the 1990 market after the crash and it floundered for many years hope not case for this one.

 

Currently I am concentrating on acquiring key coins whenever I can. Collect what makes you happy or comfortable investing.in I am just a coin addict.

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This market reminds me a lot of the 1990 market after the crash and it floundered for many years hope not case for this one.

Except that market had to meander because that's the nature of a market after a crash: it takes years if not decades to stabilize. There can be up moves, but compared to the prior bubble up-move, it's just a correction in a big downtrend. Lower-lows often await.

 

This market is going nowhere or is flattish because the underlying metals (gold, silver) have done nothing but base after the big decline from $1,800/oz. and the rapid decline at $1,400/oz. And of course, they are down from those levels so coins have to follow.

 

Check some of my MS-65 Saint premium charts listed above in the other threads. Premiums got as low as 25-40% but have been basing for 10-15 years.

 

I liked the rest of your post, Bourse.

 

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Thank you everyone. As for today's market, is it comparable to the market during/after the crash of 1980 and 1990? In other words, if this is like the previous crashes, are we at the bottom and how long before things move upwards if history repeats itself?

 

I believe that the answer to this will come later in the year. With the new president and members of congress we really need to see just how much cash they are going to dump into our economy. ;)

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I believe that the answer to this will come later in the year. With the new president and members of congress we really need to see just how much cash they are going to dump into our economy. ;)

Personally, I think it's all about the price of gold. However, to the extent that since Trump's election gold has fallen and rates have risen, those are negatives for the coin market.

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For those that were actively collecting, how does the state of the current market compare to that of 1980 and 1990?

The 1980 market was largely a result of the crash of the underlying bullion markets. Gold fell from $850 to $375 in a few months; silver went from $50 to $12. Anything leveraged to the gold/silver price went down huge. I believe some Saints went down 75% in price and many Morgan Silver Dollars (MSDs) fell 80-90%.

The 1990 market was driven by expectations that hundreds of millions would be moving into the numismatic arena on behalf of Wall Street investment funds. This caused a multi-month stampede into an already hot market: gold had recovered after the 1987 Crash and many people were wary of stocks and real estate. Money flowed into MS-65 coins causing a 500-700% premium for many Saints to the underlying gold. MSDs doubled or tripled in a few months; quadrupled or quintupled over a year or so.

 

It was alot like the Tech Boom of 1999-2000 back for coins in 1989-90.

This is very much how I remember both crashes. The "boom" leading up to 1980 is the biggest I have ever experienced. And the subsequent crash was also the biggest, again, to my recollection. It was driven by bullion prices, but silver seems to have been the really major player. When it all came crashing down in 1980, many dealers went under (I've been told), and it took a decade to recover.

 

1989's crash was due to the crazy, irrational speculation on certified coins as "commodities". Because there were so few coins certified (compared to today), so-called "rarity" was wildly inflated on certain coins that have since proven to be common. For example, I want to say that 1881-S Morgan dollars in MS-65 were bringing $500 or more at the time! If you take inflation into account, that's probably 700% or more over their comparative value today.

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For those that were actively collecting, how does the state of the current market compare to that of 1980 and 1990?

The 1980 market was largely a result of the crash of the underlying bullion markets. Gold fell from $850 to $375 in a few months; silver went from $50 to $12. Anything leveraged to the gold/silver price went down huge. I believe some Saints went down 75% in price and many Morgan Silver Dollars (MSDs) fell 80-90%.

The 1990 market was driven by expectations that hundreds of millions would be moving into the numismatic arena on behalf of Wall Street investment funds. This caused a multi-month stampede into an already hot market: gold had recovered after the 1987 Crash and many people were wary of stocks and real estate. Money flowed into MS-65 coins causing a 500-700% premium for many Saints to the underlying gold. MSDs doubled or tripled in a few months; quadrupled or quintupled over a year or so.

 

It was alot like the Tech Boom of 1999-2000 back for coins in 1989-90.

This is very much how I remember both crashes. The "boom" leading up to 1980 is the biggest I have ever experienced. And the subsequent crash was also the biggest, again, to my recollection. It was driven by bullion prices, but silver seems to have been the really major player. When it all came crashing down in 1980, many dealers went under (I've been told), and it took a decade to recover.

 

1989's crash was due to the crazy, irrational speculation on certified coins as "commodities". Because there were so few coins certified (compared to today), so-called "rarity" was wildly inflated on certain coins that have since proven to be common. For example, I want to say that 1881-S Morgan dollars in MS-65 were bringing $500 or more at the time! If you take inflation into account, that's probably 700% or more over their comparative value today.

 

PCGS MS65 common date dollars reached at least $800, and MS64's, at least $400.

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1989's crash was due to the crazy, irrational speculation on certified coins as "commodities". Because there were so few coins certified (compared to today), so-called "rarity" was wildly inflated on certain coins that have since proven to be common.

 

That sounds a lot like the current set up with explosions in population and grade inflation except for the prices are much lower to begin with.

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This is very much how I remember both crashes. The "boom" leading up to 1980 is the biggest I have ever experienced. And the subsequent crash was also the biggest, again, to my recollection. It was driven by bullion prices, but silver seems to have been the really major player. When it all came crashing down in 1980, many dealers went under (I've been told), and it took a decade to recover.

 

1971-80....price of gold went up over 20-fold....inflation and interest rates skyrocketed....floating currencies...gas lines....perfect for gold and gold coins. Ditto silver, which actually went up 50-fold from the late-1960's.

 

1989's crash was due to the crazy, irrational speculation on certified coins as "commodities". Because there were so few coins certified (compared to today), so-called "rarity" was wildly inflated on certain coins that have since proven to be common. For example, I want to say that 1881-S Morgan dollars in MS-65 were bringing $500 or more at the time! If you take inflation into account, that's probably 700% or more over their comparative value today.

Blumert mentions that coin in his article. Probably fell 50% in 2 months and probably fell peak-to-trough about 80-90%.

 

He says an 1878-S Morgan sold for $34,000 at the time (probably was an MS-65) !! :cry: I think an MS-64 today goes for about $1,500-$2,000 (not an expert so feel free to chime in). Even MS-67's are not selling for $7,000 - $10,000 (at least on Ebay, have to check HA).

 

 

Edited by GoldFinger1969
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This is very much how I remember both crashes. The "boom" leading up to 1980 is the biggest I have ever experienced. And the subsequent crash was also the biggest, again, to my recollection. It was driven by bullion prices, but silver seems to have been the really major player. When it all came crashing down in 1980, many dealers went under (I've been told), and it took a decade to recover.

 

1971-80....price of gold went up over 20-fold....inflation and interest rates skyrocketed....floating currencies...gas lines....perfect for gold and gold coins. Ditto silver, which actually went up 50-fold from the late-1960's.

 

1989's crash was due to the crazy, irrational speculation on certified coins as "commodities". Because there were so few coins certified (compared to today), so-called "rarity" was wildly inflated on certain coins that have since proven to be common. For example, I want to say that 1881-S Morgan dollars in MS-65 were bringing $500 or more at the time! If you take inflation into account, that's probably 700% or more over their comparative value today.

Blumert mentions that coin in his article. Probably fell 50% in 2 months and probably fell peak-to-trough about 80-90%.

 

He says an 1878-S Morgan sold for $34,000 at the time (probably was an MS-65) !! :cry: I think an MS-64 today goes for about $1,500-$2,000 (not an expert so feel free to chime in). Even MS-67's are not selling for $7,000 - $10,000 (at least on Ebay, have to check HA).

 

 

You should double check prices for MS64 1878-S Morgan dollars. - they don't trade at anywhere close to the figure you posted. And EBay is not the best place to check for sales of MS67 examples.

Edited by MarkFeld
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How small and thin is the collector coin market? Have you researched statistics concerning the matter - if not in broad terms, perhaps by coin type?

 

I would think that the US Mint has done so in regards to what they specifically produce for coin collectors.

 

Edited by Afterword
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You should double check prices for MS64 1878-S Morgan dollars. - they don't trade at anywhere close to the figure you posted. And EBay is not the best place to check for sales of MS67 examples.

$200 more like it, Mark ? I qualified my rushed guestimate but it seems I was still way off, thanks for the heads up. Looks like the price triples or quadruples if you go up to MS-66 and then again for MS-67 (those are ballpark figures...approximations...just confirming that the price moves bigtime after MS-65. :grin: ).

 

That $34K sale may have been a bubble outlier rather than the price for a few weeks or months, but even so the drop since then looks to be on the order of over 90%. That was my point even though my numbers were off.

 

Blumert didn't specify the grade for the coin that sold for $34K but even if it was an MS-67 you are down almost 90% from that price. Of course, I doubt many coins traded at that level even for MS-67.

Edited by GoldFinger1969
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PCGS MS65 common date dollars reached at least $800, and MS64's, at least $400.

Thanks Mark....so today those same MS-65's are $150 or so, give or take ?

As I recall, for most of 1989-90 the price of silver was $5-$6 or so, give or take. So the price of silver has TRIPLED since then yet these coins are still down 75% or so on average from the bubble peak, and I'll bet even 50% or so from the prices months before or after the Bubble Peak.

That's how crazy things got !

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