Coin Market Prepares To Spring Ahead

I dare not repeat these thoughts out loud as I type...yet after more snow than the abominable himself would care to see has been dumped in my city we have had several days with temperatures reaching 60°. As I write this, it’s bright and sunny and about 55. I can actually see bare ground in spots and signs of green poking through! While I wasn’t able to make the first installment of the 2017 Long Beach Expo, collectors and dealers I’ve spoken to are reporting a rather active show. Dealers were seen scurrying through the aisles during set up on Wednesday trying their utmost to purchase new inventory at competitive prices. During the show serious collectors were also jockeying for position on the convention floor and at the host Heritage Long Beach Signature auction. Conditions on the bourse floor, while not overflowing with attendees on any particular day, was described as steady and active. Not surprisingly many dealers have proclaimed that the market for US rare coins is extraordinarily strong, especially coins that are in the bread-and-butter $1,000-$10,000 category. Dealers just can’t find sufficient material to satisfy the growing throng of collectors demanding quality coins in that price range.

So as spring is fast approaching, the coin market appears to be on a positive footing. One native Golden State collector advised me that he is anxious to buy silver coins on his want list. “I am a collector and investor and I’ve always tried to get the most value for my numismatic dollar,” advised the Studio City resident. “I like to get silver coins as close to their bullion level as possible, but I also want my coins to have some numismatic value; not just junk 90% silver.” So I asked Brad what in particular was he targeting. “I think at this point in time Morgan dollars are especially great. I mean ever since the new president was elected, the price of silver has been trending up. It can be cyclical and I have seen it happen many times before, but silver was trading at about $15.90 the first of this year and is now up over 15%. During the same period I have still been able to buy a reasonably good mixture of common date XF to AU Morgan dollars for the same price I was paying two to three months ago.”

The Studio City resident went on to share some of his other market observations.

“Listen, I don’t claim to be a professional, but I do know that the stock market is really overvalued and is due for some sort of severe reckoning. I can afford to buy gold in a lesser quantity but you can’t find great deals on gold; everyone knows to the fraction what the stuff is worth. But dealers for the most part aren’t as conscientious with silver. I can still get quantities of nice foreign silver coins at 5% to 10% below melt. I keep my eyes out for broken up pre-1968 Canadian mint and PL sets where the coins are 80% silver. Some of the stuff has higher catalog values and can be retailed individually, too."

"If you have time and some patience you can make quite the haul. Individually probably not, but through volume you can get great value searching through the foreign silver coins that appear in dealer’s junk boxes and at some foreign coin dealer's tables. Many times I find some dealers just breaking up some sets and don’t need the minors or coins that might be tarnished or otherwise not near 100 percent perfect. Usually a little Jewel Luster will remove most of the unattractive tarnish and you have a nice Gem BU coin. You can make some serious money by just knowing the bullion values of popular foreign silver coins. As an example, the Austrian 25 and 50 shilling silver commemoratives from 1955 to 1972 are not really scarce. Although several of the earlier proofs are but regardless they make for a neat mixture of European commemoratives at about melt or below.”

I certainly agree with Brad's assessment regarding world silver coins; many in high-grade are still out there and many of them also harbor relatively low mintages. If you can acquire these at around melt, you certainly can’t go wrong. And of course the NGC World Coin Price Guide lists all of the world silver coins by their ASW and melt value which is synchronized to the actual current spot price, so the grunt work is done for you!

Another Golden State resident hailing from Encino, California advised that she attended her first Long Beach Expo on the advice of her son that it was time to get some hard assets and recommended NGC-certified US gold coins.

“I am new at this," said Miriam. "I like jewelry, but never gave much of a thought to gold coins. My son thought it would be a good time to diversify and he was there to help me. I was able to get, I guess they’re called common dates, the 1923 and 1924 $20 St. Gaudens coins. They are all NGC MS 64s. We paid $1,350 each and I bought four of them.”

I congratulated her and quickly pointed out to Miriam that with gold trading at $1,255 per oz. as we go to press that the price paid reflects only an 11% premium over the actual melt value of the coins. It is truly amazing that a near full Gem $20 Saint can be purchased at such a small percentage over the intrinsic value. The premiums have all but eroded away; these in my opinion are huge bargains!

“I know it seems such a very small amount. They are such a better value compared to any jewelry I could have bought and the coins are just gorgeous. My father collected some coins, Buffalo nickels and the old silver dollars. I just never got in to it; it was a guy thing I thought. I really enjoy these gold coins and I am going to get involved with the hobby and collect as many of the ones that are affordable.”

I, of course, advised the budding numismatist to visit and explore the NGC website for pricing, historic data, etc. She has since downloaded the NGC Mobile App for her iPhone! “This is great and I will be in touch if I have questions.”

Presently according to auction data and dealer bias, there is tremendous demand for problem free Early Federal copper and high-grade Colonial issues. I heartily concur that the market for high-grade Colonial issues as well as consensus rarities are performing admirably. In many instances coins that have only been off the market for a short duration are being targeted by serious collectors. As one well known dealer that makes his livelihood in this market said, “The aggressive collectors are making it very difficult to purchase coins at auction at anywhere near levels I would like.”

I personally have noted numerous quality NGC Colonials that have appeared at public venue twice or more in the last 2 to 3 years and have more than held their value. In some instances the collector demand in prices realized is evident. A prime example is the 1652 Pine Tree Shilling Large Planchet No Pellets NGC MS 65 Finest Known Noe-3 that just appeared at the Heritage Long Beach sale. This coin is just a tremendous and iconic bit of Colonial Americana. Immaculately preserved, a truly stunning example. To put this in context this shilling made her grand appearance as part of the Donald Partrick collection just a smidgen over two years ago at the 2015 Orlando Winter FUN auction where this prize offering captured a solid $70,500. Now reappearing at the just concluded Long Beach Expo Heritage Signature sale this prestigious 1652 NE Shilling roared well over 6 figures claiming $111,625 which reflects a robust 58% increase! Normally coins that reappear on the market in such rapid fashion lack such bidding muscle since the original buyer is no longer in the mix. Overall, the Heritage Long Beach Signature sale (February 16-19) realized slightly over $11 million. Keeping with the theme, three of the four coins which exceeded six figures at this sale were all Colonial coins. My personal favorite, the 1788 New Jersey Copper Running Fox Before Legend M77-dd NGC MS 65 came up just a tad short at $99,875.

Wow! March should be busy, exciting and market trending! Coming up next week The ANA National Money show in Orlando, Florida and ending the month is the first of the Baltimore Whitman Coin & Collectibles Expos (March 30–April 2) topping off on March 31 with the Stack's Bowers highly anticipated Brent D. Pogue V sale.

Until next time, happy collecting!

Jim Bisognani is an NGC Price Guide Analyst having previously served for many years as an analyst and writer for another major price guide. He has written extensively on US coin market trends and values.