It is not a Facebook initial public stock offering, but for numismatics, it is close.
When the U.S. Mint begins to sell the two-coin silver American Eagle set June 7, everybody who made money on the October sellout of the 25th anniversary American Eagle set and every collector who missed that opportunity will be doing the math and wondering how many sets to buy.
This offering will be nothing like the quick October sellout of just 100,000 sets.
For starters, the Mint has not set any kind of maximum mintage. It promises to strike as many sets as collectors place orders for in a four-week ordering period that ends July 5.
Such an arrangement protects the Mint from any further accusations from collectors of the kind that ranged from bad planning to favoritism in the October program.
Even as this is written, I do not know what the asking price will be. The Mint is holding its cards close to its metaphorical chest.
With an “S” mint proof and “S” mint reverse proof, the set should be roughly 40 percent of the price of the five-coin anniversary set, or $120. With the Mint’s penchant for pricing in amounts that end in 95 cents, I expect $119.95 is a strong possibility. A somewhat lower price would raise the perceived value for money in the minds of collectors. A much higher price will push collectors toward concluding it is a rip-off.
There also are no order limits, so big dealers and little collectors can mortgage their assets and take as big a gamble on the sets as they want.
But by definition, if everybody can buy all they want, who will be left to sell the sets to after the order period closes?
That’s the question. Sometimes it leads to a paradox.
I was chatting with Atlanta dealer Larry Jackson at the American Numismatic Association convention in Denver. He pointed out to me that the 20th anniversary silver Eagle sets also allowed unlimited orders before the offer concluded, and yet the price rose on the secondary market anyway.
So what will happen this time?
You have a lot of potential buyers yearning to see a repeat of the October event. This will push up demand.
You have calculating collectors figuring that an unlimited mintage with no individual order limits will push demand down.
Does that mean it will be a wash?
It is easy to say that the mintage will be greater than the 100,000 anniversary sets.
But how much higher?
I was thinking 350,000. Buyers will have to pony up $42 million to take them all at $120 each.
Jackson figured it could be even more, if the 2006 experience proves to be any guide.
One thing I do know: There will be plenty of fence sitters who will watch the Mint’s new online odometer until the final day or two before they end their mental agony and act one way or another.
What will you do?