Seventh Annual Market Review

In my previous article, I mentioned that there was loads of holiday spirit but no snow — a bit unusual, as we were deep into the holiday season in New Hampshire. That has been taken care of, and then some!

As I write this, snow is falling quite heavily, and a gaggle of turkeys are gathered in my front yard, grazing for some tasty morsels in the snow. As the mantle of white builds, it is certainly looking a lot like Christmas.

And since this is my last installment for 2017 (Really, where did the year go?), it’s also time for my Annual Market Review. This year, well-known numismatists have contributed in grand fashion, with so much enthusiasm, in fact, that this installment will be Part I!

I appreciate my colleagues’ insights and commentary so very much. Without further ado, I present my seventh annual review. Now, considering this article will post as the little folk up north are working overtime to ensure all collectors will indeed have a joyous season, I asked my expert panel for some direction for those new to the hobby.

Best values/advice for collectors just getting started … coins/sets on a budget of $100 or less

Steve Roach, Coin World editor: “For fun and learning, I'd put together matched circulated sets of key series like Washington quarter dollars. For Washington quarters, the 1930s might be Very Fine, and later dates can be About Uncirculated. It will teach you a lot about grading; you have the fun of actually handling coins and putting them in old-school blue Whitman albums, and it's a nice way to own some silver bullion. Just watch out for added mintmarks on the key 1932-D and 1932-S issues!”

2016-W Proof Silver Eagle Click image to enlarge.

Brian Hodge, Partner, Minshull Trading: “I think the modern sector is a good launching pad at this price-point. A Proof American Silver Eagle, for instance, is a beautiful coin for not a lot of money.”

John Brush, President, DLRC: “Buy coins that you enjoy. Chances are, if you are drawn to something for some reason or another, someone else will be as well, when the time comes to sell.”

Ian Russell, President, Great Collections: “I would recommend lower-grade Barber quarters and half dollars. Great history, not easy to assemble and great value. The market is low on this area at the moment compared to other series.”

Charles Morgan, Editor, CoinWeek: “You can never go wrong with a book, to be honest. But whenever you make your first dive into coins, realize that the first coins you buy may not be the ones you keep or love forever. Always keep your emotions and expectations in check, and use your first year or two in the hobby as a time to explore and experience things. You will ultimately find that area that you are most passionate about — and, more often than not, this area would be the farthest one from your mind when you get started.”

Jim Halperin, Co-Chairman, Heritage: “Wonderful Morgan Dollars are a popular entry point, but few know that beautiful and interesting Conder tokens from the latter part of the 18th century are available for less than $100. Even error coins, the curiosities of the coin world, can be very affordable (and, fair warning, addictive) to collectors of all levels.”

Q David Bowers, Co-Founder, Stack’s Bowers: “Building a small working library and using it is the key to success. Collectors of paper money furnish an example. Collecting notes requires some knowledge and reading. Those who make purchases tend to stay with the hobby for a long time. The certification of notes has been a benefit as well, adding assurance to grading. As I see it, forming a nice collection of inexpensive coins, tokens, medals and paper money, if done slowly and carefully — and by reading about items before you buy them — can greatly enhance a lifestyle, too.”

What has changed, if anything, with your business this year: surprises or disappointments, etc.?

Steve Roach: “I continue to be thankful that collectors support traditional hobby brands like Coin World by reading our publication, subscribing and visiting our website. A strong hobby needs vibrant publications and media outlets to connect collectors, teach people new things about items in their collections and introduce people to new collecting areas. I've been excited by the growth of the Newman Numismatic Portal and am looking forward to seeing where digitization efforts take our hobby. For me, the American Numismatic Association's archive of past issues has been a wonderful benefit that's been fascinating to read. The permanence of physical publications in an era where things go online and evaporate helps preserve our knowledge and documents the history of coin collecting.”

Brian Hodge: “I think for the rare coin arm of our business, our model has changed a lot. Our focus has been largely on high-end rarities this year. This part of the market seems exceptionally strong, with a lot of money waiting on the sidelines for the right coins. Ancient coins have also taken a more substantial role in our business model.”

John Brush: “We made a number of adjustments in our business in 2017, starting the year off by adding Gary Adkins to our team at DLRC. This allowed us to increase our presence at shows throughout the country, and it allowed Gary to pursue running for the presidency of the American Numismatic Association, which he eventually won. Most of our other changes were rather imperceptible to the outside world, but consisted of growing our inventory in quantity and quality, as well as adding staff to better service our base of collectors and customers.”

Ian Russell: “It was surprising how much stronger the coin market became after the election took place in November 2016. We have a lot of data showing stronger prices throughout 2017. I don't believe it was the outcome of the election, necessarily, but more so that the distraction for many months finally came to an end. We were no longer watching TV when we got home for the latest scandal or debate etc. — and that time can be spent on coins. Our business continued to grow throughout the year — we added three people to our team and probably another one or two will be added in early 2018.

“Precious metals continue to disappoint — we probably would have predicted a bigger uptick in gold/silver compared to 12 months ago — but perhaps that's what 2019 has in store for us.”

Charles Morgan: “The only constant in this industry is change. We continue to push the envelope with what our technology can achieve in regards to the amount of time we have. Publishing CoinWeek is hard work, but we are excited that we will be bringing new techniques to our video shoots in 2018. Also, our new website design has opened the door for us to do things we have long been planning, to bring the hobby to more collectors in the 20-50 age group.”

This 1989 Dragon & Phoenix Pattern Gold 200 Yuan, graded NGC PF 69 Ultra Cameo, was the top item in Heritage Auctions' World & Ancient coin auction held in Hong Kong, China. It realized $408,000. (Image courtesy of Heritage Auctions) Click image to enlarge.

Jim Halperin: “Heritage Auctions is not immune to the softening of the United States rare coin market, as fewer coins that realize $1 million are coming to market right now. But the exceedingly rare examples at auction met and often exceeded expectations. Our most significant investments surround world coins. Heritage celebrated its highest-grossing World & Ancient coin auction held in Hong Kong, China, with more than $5.4 million, and coin sell-through rates of more than 98 percent by lot — results that validate our investment into the Asian market (our Hong Kong office opened in 2015 in China) as a solid benefit to our clients.

“We anticipate this year’s opening of our London office also will pay big dividends for bidders and consignors alike, as we work to expand the firm’s international outreach.”

Q David Bowers: “Today and this year, the market is in a quiet period. This follows a number of years of generally rapid growth. Time and again, such periods reach a peak, people who enter the hobby (or industry) as an investment find that quick profits are elusive, they leave, and the market remains in the hands of true collectors.

“Back in the summer of 2013, I discussed market conditions with Christine Karstedt, my longtime business associate at Stack’s Bowers Galleries. I felt that we were at the very height of the current market, and I suggested that if we had a popular but readily available coin such as an 1879 Gem Proof $4 Flowing Hair Stella, we would probably have a dozen bidders, mostly dealers, at the $200,000 level. After watching the action at the ANA convention, I predicted that the prices would not hold, and suggested that it would not be too long before a similar Stella would sell for tens of thousands of dollars less, with just a handful of bidders. This comment held true.

“This is not a negative. Indeed, the 2018 market, with prices of many popular federal coins down 20 percent or so from previous highs, is a buyers’ market. Anyone desiring to put together a popular set, such as United States coins by design types in grades from MS 63 to MS 65, can make very advantageous purchases. The same goes for such series as Morgan silver dollars. As to commemorative coins, one of my favorite series, these have been in the cellar ever since 1990. I can’t quite imagine why, but that is where they are.”

Personal remembrances, reflections, holiday memories relating to numismatics

John Brush: “I remember receiving a ‘No Cents’ V Nickel from my parents when I was 10 for Christmas. While it wasn’t the most exciting gift I ever received, I still have the coin, and I’m thankful for my parents’ prodding and encouragement in this great hobby.”

Jim Halperin: “While we joined the hobby in mourning the recent passing of the legendary numismatic scholar Eric P. Newman, it is truly a time to reflect and celebrate his enormous contributions to our hobby. A collector for almost a century, a numismatic scholar and author, Mr. Newman’s knowledge and love of numismatics may never be matched. Heritage had the honor of working with the Newman Collection, which included 19,146 lots that, in total, realized nearly $73 million.

“His fascinating story is told in detail in the expansive biography Truth Seeker: The Life of Eric P. Newman. The book comprises the history and content of his renowned and unparalleled collection, which he donated to charitable causes. It is a fascinating read.”

Dave Wnuck, DaveWcoins.com: “Ever since I was 12 years old, I have had a coin business. All through junior high, high school and college, it was part-time. After college, I got married and got myself a ‘real job,’ but I always did coins on the side. I ran the coin business at night, on weekends and during most vacations – perhaps some of you know that drill.

“After several years of this, my wife turned to me and said: 'Dave – why don't you just quit your job and go into the coin business full-time? You clearly love it. In the worst-case scenario, we will go through all of our savings and then you can go out and get a real job again.'

“I have the best, most understanding wife in the world. Obviously! So I did exactly that. I quit my job, effective at the end of the year. My first official, full-time week in the coin business happened to be the week between Christmas and New Year’s.

“I remember sitting at my desk and …. nothing. Nothing at all was happening. I couldn't force anything to happen. I thought to myself – maybe I have just made the biggest mistake of my life. I have a family to support and there is absolutely no way to do it. I had a sick feeling in the pit of my stomach.

“After a week of despair, New Year’s Day came and went, and then the FUN show began. I had a great FUN show that year. Since that first awful week, I have been lucky enough to be in this business full-time for over 20 years. And I'm thankful for that.”

Enjoy the holiday season, my friends!

Until next time, happy collecting and happy new year!

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.

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