Editor’s note: The following is the Market Report by Laura Sperber on the Legend Numismatics Web site. It is published with permission. The Web address is www.legendcoin.com/cgi-bin/inventory/cms2.pl?page=market_report.
Portland ANA Show
Until the crowded flight finally left lovely Newark, N.J., an hour late (at 8 p.m.), we seriously struggled with not going to the show. We expected the worst: poor attendence, no East Coast dealers, lack of activity because of the overall market, and it was just too darn far away (we didn’t get to our hotel until 1 a.m. PST)
We were so wrong about the show! In fact, we have not had seriously good back-to-back shows in quite a while, let alone a really good ANA Midwinter. The 2009 Portland ANA show turned out to be surprisingly good for Legend. So Long Beach and Portland back to back were good! We also believe that as word gets out it was good for others (we assume), it will help the overall market attitude as well.
To us, the public attendance seemed light. However, instead of the crowd being mostly Lookie Lous, there seemed to be a strong amount who came to buy. It was obvious collectors in the Pacific Northwest hadn’t had a major show in the ‘hood for years. We saw many (we mean many) old friends – some of whom we hadn’t heard from in years. It was a little like the last Long Beach, where people came to check out what was happening. The big suprise to us, we made several retail sales – two for coins over $10,000 each to people we never met before. We believe the fact the show was so small helped many dealers with sales as the public didn’t have many tables with really cool (Legend calibre) coins to choose from.
Dealer to dealer was red friggen’ hot! We do a ton of “stealth” wholesaling. That means we give our coins out to contractors for the shows. First thing Thursday morning, we were already receiving confirmations of sales. On a few of the bigger sales, we had to give terms – which we expected would happen, but it did not seem cash flows overall were hurting too bad. All through the show, our sales team was calling with offers or confirmations of sales. We ourselves did a few unexpected big sales before the show began. The biggest shock to us was when the show opened – activity not only did NOT die, it only got stronger!
On the wholesale level, it was all about GOLD. The junkier the gold, the more it was bought. We saw a “crackout” dealer who had at least $1 million of soon-to-be- popped gold in a case. The legit telemarketers of the world cannot buy enough gold! Since they are again almost unable to get any quantities of bullion, they turned to generics. Well, now they can’t find MS-65 Saints, so they go down the ladder. If you were to look through all the dealers’ boxes, you saw very little gold. The first question asked when showing boxes: Have any gold?
We know one major wholesaler SOLD $1 million on Thursday alone – and not all of it was gold. As we sat at that dealer’s table, we watched them purchase a deal well in excess of $500,000 in under 15 minutes. That’s not really amazing. They then walked it over to another dealer who bought most of it for an immediate check! It wasn’t any kind of a frenzy. It was strong trading if you were willing to do so at the current “new” market levels.
Plus, we clearly now see BOTH dealers and collectors shopping again for quality type coins. To quote one, the biggest buyer for several top telemarketers, “ I looked in my inventory box and I have no coins!” He then immediately went on to ask what we had and bought what we were willing to sell. Only a week ago he had told us he was cautious and didn’t want to sit on a big inventory – now his attitude and buying habits are totally reversed.
We were sort of back to pre-summer ANA happenings. Dealers complained there were no coins to be found and that it was the same dreck circulating over and over at the show. Unfortunately, Legend’s chief buyer had a miserable eye infection and could not venture out much to find anything (Thank you to everyone who came to the table, saw that and STILL wanted their coins looked at!). So our buying was VERY limited as was our watching the activity at many tables.
What will Baltimore be Like?
If we could give an exact answer, we’d be on a beach in Hawaii. We do however think the following is happening: so much gold has been bought that supplies are critically low. The telemarketers are doing what we knew had to happen. They are getting their people one by one to check out rare coins, and maybe even buy one (usually gold of course). Dealers also love to stock up on true rare coins if they have made some money. Regular collectors who have been beaten up pretty much in the financial world now fully see that rare coins have indeed held up. So they love the fact prices are off just 10-20 percent and feel they can’t miss by buying some coins now.
We can’t really envision a huge crowd at this upcoming Baltimore show. We see the normal crowd who comes as more NY/NJ people – and they are the ones hardest hit with the losses of Wall Street (and related) jobs. The show also has 400 dealers – not 150. More to choose from will mean less sales. Plus, we just do not see where any major group of fresh coins will come from. We fully believe the Whitman people run the best show in the world (ugh, next to little COINFEST), but this particular show could very well feel the effects of the economy. We hope we are wrong!
The Market Overall
What we did not mention is that sales back in the office have been incredibly strong. Last week we sold multiple five- figure coins to different collectors (the most expensive being the HR in MS-66 we had listed at $86,500). Great coins definately ARE selling. The week before, things were on the quiet side. So we think this upcoming week will be a better gauge of activity. So we will suggest to you if you are thinking about buying-jump in now. One by one others are too! Why wait for the herd or possibly higher prices?
Also, at the show we stopped by a major buyer’s table. Typically he has dealers lined up for him to make offers on their coins. We sat down with him for a minute and asked where everyone was. He was shocked, too, that no one was selling. To us, that is a HUGE sign of strengthening. There is NO glut of great coins out there. As we keep mentioning, the only glut is overgraded dreck.
With overall activity seeming to grow a little stronger each day, we think that by the ANA summer show, the market will be close to where it was at the 2008 ANA show (in terms of activity, most pricing, and strength).
A Rant About Set Building
Recently we have started working exclusively on two major new collections. One thing that has always shocked us is how collectors who want to build the “finest” sets start out so wrong.
The most consistant mistake we see – buying a marginal coin to fill a hole. NEVER EVER DO THAT! The coin you should buy for your collection should be the last one you want to buy. NEVER settle for so-so if your mission is to build the finest. It does cost you money to get out of the original coin. Think about this – a monster pop 2 coin comes to market; there are others who want this coin bad and will write an immediate check. Why would any dealer want to have to take a marginal trade-in?
Also know that even if you seek to build a FINEST KNOWN collection, it does NOT have to be all the top-graded coins. The entire world knows we built the remarkable MS Trade dollar set with our partner Bruce Morelan. Bruce is a typical collector. If he knows a top pop coin exists – he has to have it. Well, we would not let him (and believe us, he was very tempted)! There was one date, Pop 1, the ultimate grade that we vetoed him time and time again on. Why? The coin was ugly, it was technically graded, and we felt it would actually harm the value of this collection more than help it. So now, he has an absolute monster coin that one grade down which makes his set a total WOW! You NEVER want ANY coin that’s not the ultimate best. Yes, that means you may even have to buy a coin that is 2 points less than the finest certified!
YOU CANNOT BUILD THE FINEST SET OF ANYTHING BY LETTING YOUR EGO BUY THE PLASTIC! QUALITY IS IN THE COIN, NOT THE PLASTIC!
All that glitters is gold! There probably is not enough gold on the planet to supply the incredible demand we see. Much to our surpise, dealers are telling us silver commems are strong (we are investigating this – but we have heard this from multiple sellers). ALL early Bust coins. ALL early Copper. Morgan dollars under $1,500.
What’s Not Hot
The fire is wearing off Lincoln and Indian cents. Buffalo nickels too. MS and PR high grade (PR-67-68) coins seem to have slipped.
Unfortunately for us, Patterns have quieted down a little.