Dog Days of Summer?

Tuesday, June 1, 1999

        For much of the last three decades, the wholesale coin business has consistently slowed during the summer months. There may have been a few spurts on occasion, but this was the time of the year when most coin dealers would plan long vacations or at least brief jaunts with their families. However, the last two years, the "dog days" came and went as most dealers continued to do business as if there were no change of season or market climate. As we approach summer this year, we do not see any reason to expect a change in overall market activity. In fact, we are noticing more coins changing hands. With new coins from major auctions and notable collections coming onto the market in addition to normal everyday transactions, well, there seems to be no slowdown at all.

        While the overall coin market has been very active in the last month and a half, the price of gold bullion has dropped $15. While this may have some psychological repercussions on the marketplace, most dealers feel this has no substantial effect on the prices of legitimate collector coins. What this downturn does for the dealer and collector is offer opportunities for adding common bullion coins to their inventory or collection. While the bullion-related gold coins may drop slightly, we are finding that there are enough collectors (and investors) who are willing to take advantage of lower prices and add to their holdings. With dealers reporting strong activity in the area of collector coins, the main problem continues to be a lack of enough fresh new material to satisfy this very heavy demand. A portion of this problem comes from the fact that everyone wants coins with eye appeal, willing to pay the price as long as they feel they are receiving consistent quality for their money. Average to low-end coins require discounts to entice buyers.

        There are several areas of the market commanding the affections of dealers and collectors at this time. Always near the top of the list are Morgan and Peace Dollars, which are followed closely by Indian and Lincoln Cents. The Dollar market appears to expand every month. More and more collectors are trying to locate specific coins they need, obviously having the means to compete for these coins. This is one of the main reasons that you will see Dollar prices advancing for quality coins. Before we go any further, let's qualify what we mean by "quality" coins. We refer to this quite a bit, as it is the basis by which we tackle the fair market value of numismatics. We do not use low-end coins to represent market prices. Low-end coins are not the types of coins collectors want to purchase; these are not the coins dealers want to buy back at a later date. We monitor the market for coins that are at least middle to upper-end of the grading spectrum-quality coins. These are the coins that buyers (dealers or collectors) ask about and the only negotiating point is price-not quality.

        Not only are Indian and Lincoln Cents very sought after, so are Half Cents and Large Cents. We just don't see as much activity because they are more specialized. But, if you go to a major auction that has a sizable number of these larger copper coins, you will find there is very strong bidding for various dates and varieties. Collectors are looking for just about all grades in the area of Indian and Lincoln cents and locating high grade, early dates (in either series) are of fundamental importance. In Mint State quality, most advanced collectors are looking for coins that have as much red as possible, but even more importantly, they try to avoid coins with carbon spots. These can be infectious as they may reveal a partial history of improper storage. High grade coins without spots will usually command very competitive prices.

        Activity in the coin market is not limited to the previously mentioned, as we are finding new collectors in every series. Quite obviously, Washington Quarters seem to be commanding lots of attention. Of course, this has been brought about because of the release of the 50 States design program. Many of these collectors are not yet refined in their collecting pursuits and are looking for the more recent issues. This is how expanded interest is generated in numismatics-inexpensive coins today, expensive coins tomorrow. In addition, one of the areas commanding lots of attention is the $20 Liberty series. Since this is an area that requires a substantial outlay to buy even one coin, it doesn't take a mathematical genius to figure out that collecting in this area can be an expensive challenge. However, in the last two years or so, the number of collectors for $20 Libs has increased dramatically. Furthermore, there is a wonderful opportunity for acquiring many of the rare coins in this series. There are several auctions taking place as we go to press and the results will have a tremendous impact on pricing data, especially for issues, which to this point have had no recent history in specific grades. We will have the opportunity to report the results of these prices in the July Price Guide.

        At the just completed S.S. Brother Jonathan Sale conducted by Auctions by Bowers and Merena, prices were extremely strong for the so-called common $20 Liberties. Because of the pedigree, coins that normally wholesale between the $600 to $1,500 range, were knocking down bids of two to three times these prices. A few of the big-ticket items did not disappoint. The rare 1865 S $5 Liberty in PCGS MS64 brought $48,300. In addition, the 1865 S $10 Liberty in PCGS MS64 attracted very competitive bids. It brought $115,000 and was purchased by Ron Gillio who explained that the coin was headed to the museum at the Mandalay Bay Casino in Las Vegas. The two most important coins in the second session were 1865 S $20 Libs in MS66 graded by PCGS. The first one brought $36,800, yet, the second one fetched an amazing $72,450. Several dealers explained that the second coin is the finest known and should end up in at least an MS67 slab.

        Another opportunity for the intensely sophisticated collector of $20 Liberties is the Eagle Collection. This is the only known set of $20 Liberties from 1850 to 1907, all certified; one hundred and forty nine coins. Some are as nice as you can find in the market today; a few, you can't find. All the coins in the set have been certified by NGC and the majority of the grades are AU through MS65. Some of the rarities by grade and value include the 1855 O, 56 O, 60 O, 61 S Pacquet, 79 CC, 82, 86, and the 83, 84, and 87 Proof only issues. This set has been put together by Brett Bogus of Eagle Numismatics in Texas and displayed at the Long Beach Expo in early June.

        ICG, the most recent grading service, announced they have certified a group of rarities from the Byron Reed Collection. The Parmalee/Reed Specimen of the 1804 Silver Dollar (Class I, Original) has been certified as a PR64. Included among the 30 certified rarities are the 1829 Half Eagle as MS66, the 1827/3 Bust Quarter as PR65 Restrike, and the 1826/5 Quarter Eagle in MS61.