Collectors and dealers often move in their own separate universes. Collectors collect. Sometimes they speculate. Some invest. Coin dealers are interested in the commercial aspects of coins. Turnover is key. If a coin cannot be sold for a profit, dealers simply won’t stock it.
The dynamics have been changing for coin dealers for some time. While most dealers are likely aware of this, collectors are not. Until perhaps about 18 months ago dealers could rely on buying large quantities of coins from the general public. These were often hoards. If a family inherits a hoard, they are anxious to sell it. Since such hoards have been surfacing continuously since the 1960s most dealers relied on this continuing. Hotel buyers appeared from time to time.
Coin dealers purchased large numbers of coins at melt prices, separating the wheat from the chaff. The supply appeared to be endless. It wasn’t. The hotel buyers, are gone now – for a reason. There is little money to be made as it appears the majority of these hoards are exhausted. I could be wrong, but considering the number of coin dealers who now sell other things in their stores to support themselves, I believe I’ve gotten it right. Coin collecting is not about to change, but the dealers who service coin collectors with products not available from circulation are. Dealers must adapt.
This piece was written for, and originally appeared in print as, the preface to the monthly "Coin Market" section in the Feb. 7 issue of Numismatic News.
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More Collecting Resources
• Are you a U.S. coin collector? Check out the 2017 U.S. Coin Digest for the most recent coin prices.
• Order the Standard Catalog of World Paper Money, General Issues to learn about circulating paper money from 14th century China to the mid 20th century.