In recent days I see that the British pound has dropped below the nice round number of $1.50.
I have followed the currency since my earliest days in the hobby. It probably is a legacy of World War II and all of the members of my family who fought in it.
One of my earliest coin purchases was the Churchill crown of 1965. It is a silver dollar sized coin made of copper-nickel. I paid $1.25 for it. That was one of the worst investments I ever made, though I certainly didn’t buy the coin as an investment. It was a matter of personal sentiment and history.
Every collector should buy a few coins simply because he has to own them without consideration of potential profit or loss.
I still have the coin. It is a reminder of simpler hobby times for me and is a marker on my personal trail of hobby learning. It also is a reminder that not every purchase will make me money.
I’d be lucky to get 50 cents for the coin today and that only if the buyer was doing me favor.
I would have been better off simply parking the $1.25 in the silver coins still current at the time and I would have made money. Those coins would now have a value of $25.92.
I think, though, I have gotten more than that amount of value out of my lifelong interest in certain British things and it provided me with memories of exchange rates over these many years.
The British pound was $2.80 in 1967 before its devaluation to $2.40. I learned then the risks of currency mismanagement.
By 1976, the exchange rate had fallen further, to $1.76, which is a coincidence that makes the date and the value easier to remember.
When the U.S. dollar soared in the first half of the 1980s, the pound dropped to $1.05 by 1985.
After that it rebounded over time to over $2. The financial crisis gave the pound its current hard knocks.
What are the lessons of this?
It is well to remember that currency depreciation is not a straight line pointed ever lower no matter what you might think of modern central banking. Fiat currencies can and do bounce higher – sometimes for many years.
Precious metal prices, which are influenced by currency trading, can do the same.
Buying the Churchill crown helped open the door to a world beyond my Whitman albums and to my numismatic future.
As a result I have had quite a return on my original $1.25 “investment.”
Buzz blogger Dave Harper is editor of the weekly newspaper “Numismatic News.”