Jeff Garrett: Markets on the Move

Posted on 4/22/2021

With fresh money pouring into numismatics, coin prices are unlikely to stand still.

The numismatic press has been gleefully announcing the sale of multi-million coins on a regular basis in recent months. I’m sure the Heritage sale this week will also garner headlines as a few major collections make their way to the auction block.

The sale of the 1787 ‘EB’ on Wing Brasher Doubloon graded NGC MS 65★ for over $9,000,000 was a stunning reminder that billionaires have discovered our hobby. The upcoming sale of the only legal-to-own 1933 Double Eagle will probably make national headlines. Numbers above $10,000,000 are widely predicted. The 1933 Double Eagle has one of the greatest stories in all of numismatics. Another chapter will be written later this spring.

1787 ‘EB’ on Wing Brasher Doubloon graded NGC MS 65★ and pedigreed to the Partrick Collection. Realized: $9.36 million
Click images to enlarge

Blaring headlines of these multi-million-dollar coins have very little impact for the average collector or dealer. Most of these transactions occur at auction, as they are seldom available for private sale. For years, the coins that most of us handle on a regular basis have been falling in value. That all seems to be changing!

The rare coin market is hot and, for the first time in a long time, price guides will soon be showing increased prices across a wide range of numismatic material. One of the strongest segments of the market is also one of the most widely traded: Morgan and Peace Silver Dollars. The US Mint’s release of the “tribute” 2021 Morgan and Peace Dollars later this year has created a wave of excitement for the series. Dealers are stocking up for promotions, and collectors are being drawn by the allure of these captivating issues.

A 1921 Morgan Dollar with the NGC Morgan Dollar Centennial Label and a 1921 Peace Dollar with the NGC Peace Dollar Centennial Label
Click images to enlarge.

A few months ago, the prices for 1921 Morgan and Peace Dollars started to rise dramatically. Price guides have not fully captured this meteoric jump. 1921 Morgan Silver Dollars are bringing over $40 for almost uncirculated coins. The 1921 Peace Dollar has nearly doubled in price for most grades below Gem. I suspect prices will remain firm and possibly increase more as awareness of the new “tribute” 2021 issues grows.

So-called “better date” Morgan and Peace Dollars are also rising across the board. As any dealer with a good website can attest, silver dollars are flying off the shelf. I am getting inquiries from dealers around the country looking for stock. This sudden supply-and-demand imbalance is sure to cause price increases. In a departure from the recent past, the demand is not isolated to the top of the market. There is broad demand for all silver dollars.

Silver dollars are not alone in the sudden demand for collector coins. Classic commemorative silver coins are also very strong and difficult to find at current levels. Dealers at the GNA (Georgia Numismatic Association) coin show in Dalton, Georgia were quoting me 20% above bid and they were selling out. The GNA show was the largest (about 200 tables) coin show to be held in the past year. The bourse was sold out and the room full of collectors (spaced out, of course). It was refreshing to see so much activity.

In the past, I would tell people that when I became concerned about the market, attending a major coin show would allay my fear. The absence of coin shows for nearly a year has been difficult for those who attend them for a living. It’s exciting to see a room full of people eager to do business again. As more and more of the population becomes vaccinated and the practice of social distancing combined with personal hygiene becomes the norm, we are all eager to see the show circuit come back to life.

The next big event on the schedule is the Summer FUN show in Orlando this July. For a lot of dealers and collectors, this event will be their first in over a year. I expect plenty of excitement and action.

Many wonder why coins have suddenly become the focus of so much attention and action. I talk to a lot of collectors and dealers regularly to gauge the market. Understanding supply-and-demand fundamentals is critical to making the correct decisions. A lot of collectors seem drawn to the safety of tangible assets given the seeming uncontrolled levels of government spending. Some of the trillions of dollars being created and spent by the US government are clearly finding their way into the hobby.

As I have mentioned many times, bullion buyers often soon migrate to collectibles. There has been a huge spike in demand for physical gold and silver. I get calls every day from average citizens trying to find gold or silver to protect their wealth. This huge, newfound attention to precious metals will ultimately create more collectors. Some are even buying semi-scarce coins because they can’t find actual bullion.

Last year was difficult for so many, and staying a home was the norm for millions of Americans. Besides binge-watching Netflix, a lot of these folks discovered or rediscovered hobbies such as coin collecting online. There are clear signs across the board of the increased interest for a multitude of collectibles. NGC and its affiliates in the Certified Collectibles Group are seeing a huge surge of submissions for coins, comic books and now sports cards. Dealers for all collectibles are rushing to produce material to fulfill this new demand.

It has been a long time since we have seen price increases for the broad numismatic market. Supply and demand fundamentals almost guarantee that prices will soon be rising for a large segment of the market.

Collectors have been dominating the rare coin market for quite a few years. This explains the strong and sometimes seemingly irrational prices realized for beautiful coins. If things continue as they have recently, we may finally see less-discriminating investors enter the fray. That is when prices really surge. It could be a fun and interesting time for the next few years.

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