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This week’s letters (11/05/13)

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Will dealers buy back silver coins if market goes up?
We the buyers, who have bought precious metals in order to “hedge against inflation” have a problem. In the case of a world shortage of silver and the cost/price of said metals “spike” to an undetermined amount of dollars, who will purchase the investors precious metals. Let’s create an example:
The investor has paid his local coin dealer $30 per silver Eagle with a sell premium of $6. A tube of 20 each would cost the buyer $720.
The market now rises to $150 per ounce. The investor now goes back to the same dealer to sell back his tube of coins.
The coins would cost the coin dealer $3,000 less $120 buy premium (assuming the buy premium is also $6).
1. Will the coin dealer buy back the coins which in effect would create a loss for him of $2,280 on this sale?
2. Will any dealer buy the coins if there is a spike in the metals market?
3. Or, will the dealers just say “we are not buying right now” and leave us holding the coins we thought were a good investment with no where to go with them?
I’m sure that many thousands of buyers would like an answer from someone?
Remember the government says that it will not buy back its bullion coins.
J.D. Roberts
Acton, Calif.
Editor’s note: While nobody is forced to buy back silver Eagles the fact is there are many dealers who make a market in them. Prices do fluctuate. Premiums rise and fall. However, dealers in bullion coins hedge their holdings. If they sell a quantity of bullion, they buy back the same amount so there is no net change in their position at the end of the day. They make their money on the premium, or the spread between what they pay and what they sell for.

Hard to find MS-70 Fort McHenry coins
I thought this might interest you. I thought I would try to assemble a 56-coin set of bullion America the Beautiful coins graded MS-69 Deep Mirror Prooflike, First Strike by the Professional Coin Grading Service.
I have run into a problem on the Fort McHenry. As of this date only two coins have made the grade and only 29 have PCGS First Strike MS-69 prooflike.
I called the coin store I usually get them from and was told they shipped several to PCGS and not one graded MS-69. They are going to ship more, but will miss First Strike criteria.
I bought a MS-69 Prooflike First Strike on eBay today for $650. I don’t know what the problem is, but this may end up being the rarest America the Beautiful to date.
I am 83 years old so I need to live seven more years to finish. I have written to you before and thought, what the heck, you might like to hear about my problem.
Don Drysdale
Layton, Utah

$90,000 for one coin too much for this collector
I read with interest Richard Giedroyc’s “Coin Clinic” in the Oct. 15 edition of Numismatic News in regard to the $90,000 silver Eagle. In answering Mr. Schmeyer’s questions about the sale, Giedroyc said, “Let’s hope the high prices being realized recently for these coins does not turn out to be irrational exuberance in the long run.”
As a collector for over 50 years, I think that irrational exuberance is exactly what’s going on. I hail from the days when BU rolls of 1950-D nickels were selling for several times what they sell for now.
Back in 1962, I paid $12 for a roll of 1960-D small date Lincoln cents and thought I had hit a bonanza. I still have that roll today, and if I decided to sell, I would be lucky to get $2 for the roll now, keeping in mind that the $12 I spent was 1962 dollars (probably equivalent to $120 today).
No doubt the person who bought the $90,000 coin is well-to-do and won’t miss the loss if he gets the coin out of the safe deposit box 10 years from now and suddenly finds a carbon spot on the coin like Mr. Schmeyer found on his. But I strongly urge against investing one’s hard-earned savings on such a coin (should I say coin or piece of bullion?).
I guess what bothers me most is the fact that a Proof MS-69 version of the same item could be bought for a small fraction of what was paid for the MS-70 version. But, let’s be honest. Can most collectors or dealers really tell the difference between a MS-69 and a MS-70 proof silver Eagle? I seriously doubt it. There’s just too much subjectivity involved. That’s why so many coins are broken out of their holders and resubmitted with hopes of getting a higher grade.
For my money, there are just too many rare and historical coins out there that are very reasonably priced in relation to their scarcity. I recently purchased a beautiful 1885 Proof-65 3-cent nickel piece for $700. Less than 5,000 proof and business strikes of this date were minted over 120 years ago, compared to over 30,000 1995-W silver Eagle proofs minted less than 20 years ago. For $90,000 I could buy 128 of the proof 3-cent pieces (if I could even find them, that is) and have some change left over. Twenty years from now, which do you think would be the best investment? I’ll take the 128 3 centers every time!
E.B. Robinson Jr.
Iowa Park, Texas

1909-S VDB cent, Silver Certificates will retain value
With all due respect to fellow collector Robert L. Brommer, your 1909-S VDB cent and Silver Certificate one dollar bills will not be worthless if the cent and paper dollar are done away with. You won’t be required by law to surrender them to your local bank.
The half cent, 2-cent, 3-cent, and 20-cent coins all met similar fates and still maintain their numismatic value, as well as legal tender status for anyone foolish enough to spend them for face value.
Bob Klippstein
Greensboro, N.C.

Still collecting Lincoln cents from change
I response to your Oct. 8 article “Who can be called a Lincoln collector?” I think I can still be said to be one.
It has not been but a few years ago that I determined I would try to put together an entire Lincoln Memorial set in MS-60 or better just from pocket change and roll searching. It took a while, but I did it. You’d be surprised what’s out there. Yes, there are still 1959 cents to be found, bright shiny and unblemished. Searching is just fun, and let’s face it, it only costs pennies to enjoy!
For cold, rainy days (the kind I spent my 30s out duck hunting and deer hunting) I still enjoy roll searching. I look for all the dates with any premium (like the scarcer 1982s). Like you, I never bought the 1909-S VDB to finish my collection – perhaps someday I will. But key dates have gone through the roof in price; have you looked lately?
It appears to me, that with the economy the way it’s been, lots of piggybanks have been robbed, and saved-back change from over a decade ago is making its way back into circulation. I am working on a Lincoln collection, of sorts, all the time, although I may not be filling holes in a book.
David Smith
Somerville, Tenn.

Willie Q’s help make our hobby strong
William B. Quaratine, “Willie Q.” to so many in the Redwood Empire (Santa Rosa, Calif.) Coin Club, passed away Sept. 20, losing his battle to cancer.
A regular booster and constant contributor to the Redwood Empire Coin Club, his death leaves a void and a painful loss to many northern California numismatics.
Willie Q. was known for his ready willingness to assist, his firm and friendly voice, and kind and open greetings to all that he met. I shall always remember his openness and kindness, and with his simple and quiet demeanor, one felt his sincerity and commitment. To my knowledge he never refused or complained about any chore or charge asked of him. All were completed, and nothing was asked in return.
Our hobby is filled with countless Willie Q’s in local coin clubs across our great nation. It is these ‘Willie Qs’ that make our “world of money” at its best.
It is said that an old Irish headstone reads “Death Leaves A Heartache No One Can Heal. Loves Leaves A Memory No One Can Steal.” That is our legacy of Willie Q. RIP
Remember: have fun with your hobby. Always serve others. Enjoy your collecting! Create hope and do good!
Michael S. Turrini
Vallejo, Calif.

Banker’s only obligation is to report account
In reading the “Letters” section of my Oct. 1 Numismatic News the other day, I read Jim Coulthard’s comment that bankers should be morally obligated to help their fellow man. I agree that bankers should be morally/ethically obligated to inform their customers nothing more than the current sum of the customer’s deposit and his/her balance in the account where the deposit was made.
As far as the “intrinsic” value of the deposit (if silver coins and/or rare currency were deposited), the teller does not have to inform the customer. Very often a teller is not knowledgeable of these sort of things, as he/she is most likely not a coin collector, nor a dealer.
I don’t think I’ve ever had a situation where my bank teller was also a coin dealer. One of the tellers at my bank is also a coin collector and has told me so, but that teller has “dibs” on the coins “of interest” before me and shares the dupes with me at face value of the numismatic item.
I respect that and have a good rapport with my bank, where the tellers and managers have both morals and ethics. But they’re obligated only to inform me of the current sum (face value) of my deposits made and/or the balance in my account.
Bill Tuttle
Cleveland, Ohio

 

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