THE COIN MARKET VS THE ART MARKET
By Laura Sperber – Legend Numismatics Market Report
We know people think we are wrong for comparing the two. We are are NOT making a direct comparison. We’re just trying to show how cheap we perceive coins to be (especially vs art and other areas). Rare coins will NEVER have the history or appeal of art. However, rare coins are a growing market with by far the MOST liquidity of ANY known collectible. As popular as they are, you sure can’t take a GEM Tiffany Lamp or antique chair and go to 3 dealers and get cash offers (unless they are trying to steal it).
A rare (and possibly the FINEST) Cezanne painting has SOLD for $250,000,000.00. That’s a remarkable sum for ANYTHING these days. Here is the link to the article we strongly suggest you read this article from Forbes). We want to highlight the last paragraph where the write talks about buying something finest known the quote: ” those who understand that when a masterpiece comes your way, its true value lies not in what it costs, but rather, in what it gives.” That is so true even in coins. What many collectors do not realize, is that philosiphy is happening today with the rarer better coins.
Anyone notice that finest known pre 1915 pop 1-2 PCGS/CAC coins are being gobbled up at mindboggling prices? ’Anyone noticing what Choice to GEM PCGS/CAC BUST coins are selling for lately? Even better gold w/the bean-you now have to scratch your head as to why you couldn’t even hit the starting bid or call because of the asking price. The paragraph above nailed it (read the link) as to why prices are so intense on better coins. Yet, for intense as prices are, they are still relatively cheap (in our opinion).
In the end, rare coin prices are CHEAP today especially when compared to other collectables. Unlike art or even classic cars, the rare coin market has not yet broken the $10,000,000.00 coin mark. Sure, we know of at least 3 items that will soar throught it when sold-but like with the valueable art, the owners do not want or need to sell. Jumping down a few steps, the amount of coins that SHOULD be worth $25-$50,000.00 and then $50-$250,000.00 are many.
Look at the 1869S H.10 PCGS MS66 CAC were posting for sale. Its a pop 2 with ONE MS66+ higher. You have an nearly flawless 143 year old coin that is superb. The 66+ is locked away in major collection. So why isn’t a coin like this worth $15-$20,000.00? Because pricing guides can’t report right and value the coin at $6,000.00 (please sell us any other PCGS/CAC beaned one for $7,500.00 :-))!!!
Another coin to mention: the $3 1877 PCGS MS64. It is a pop 1, FINEST graded. Only 1,468 were even minted. Its got one of the best pedigrees gold can have-Harry Bass. It sold in auction for $80,000.00 in 2011. Yet the CDN still has a BID of $43,500.00 showing. Forgetting about that, why isn’t a great coin like this worth $100,000.00 or more? There is nothing else to similar or to replace it.
The coin market has POOR reporting of prices (why does any let a WHOLESALE price guide like CDN thats apparently innacurate influence their thinking?) thus creating confusion. We believe because of these inaccuacies a fair amount of collectors stay on the sidelines. However due to superior demand, you can see a more true market emerging at auctions. Thats where the heavy hitting well educated players troll seeking the special coins (and of course its where the special coins seem to be ending up these days).
Even on something more common like a 1879S $1 PCGS/CAC MS67, yeah the WHOLESALE BID is $675.00-but what would you have to pay for a nearly flawless, semi prooflike, killer frosted GEM? Probably $1,000.00-$1,250.00. Did you bury your self? ABSOLUTELY NOT (do note-a really nice 79S will still WHOLESALE for $675-$750.00)!!!! There is strong value to be added for the WOW factor of a coin! unfortunately you’ll never see that WOW factor value anywhere in print other than auction prices realized.
The rare coin market (on ALL levels) has long way to go to achieve pricing reality (in OUR opinion). There have been a few bumps (cleaning up doctoring and gradeflation which are being address aggressively). To us, it is clear that the demand for GREAT coins is so strong that we made the prediction last Market Report that anyone who bought one of the great coins from the FUN Auction WILL be in profit on them by the next FUN Sale.
The same holds true for lesser priced coins (you do not have to be a whale buyer to enjoy this next bull pricing phase thats coming). Pricing is ALL about the QUALITY, RARITY, and DEMAND. Nice coins are simply NOT available today. So when one comes along-unless its priced beyond insane moon money, you really need to think hard and quick about buying it. Prices just can NOT stay at these levels much longer.