Some things don’t change

Will it be business as usual for the coin market in the wake of the stock market losses of yesterday?

For the Mint it certainly was. It announced it is raising its premium on one-ounce American silver Eagles Oct. 14 by 15 cents to $1.40 per coin from $1.25.

That actions seems small potatoes compared to the action on the New York Stock Exchange. The losses were large.

There is no way of knowing if numismatists as a group are less subject to making bad investments and receiving margin calls as the population as a whole.

We have no way of knowing that coin dealers as a group fund their operations with borrowed money to any greater extent than businesses of other kinds.

What we do know is they are all human and are subject to the same anxieties and fears as everybody else. They are asking themselves how the coin market is holding up.

Does the coin collector who saw his IRA or 401(k) retirement account fall seven percent or so yesterday go the next coin show or auction he was planning to go to? Will he bid as often or as aggressively online on eBay?

The odds are we collectors are as intertwined in the current financial crisis as anybody else. While collectors are probably less likely to have their mortgage interest rates reset to levels beyond their ability to pay, they may own small businesses that cannot get a credit line extended in the same amount or even at all. Here is hoping that coin dealers have bullet-proof financial arrangements. If they are forced to liquidate inventory to pay back these credit lines, prices will fall.

Numismatists will face things one day at a time just like everybody else. We always have. When I was just starting out as a collector in 1963, there were no numismatic firms selling hundreds of millions of dollars’ worth of coins in a single year. There was no firm that was publicly traded on the stock exchange. It was just me and my Whitman album doing what hundreds of thousands of others were doing.

Financial crisis I later learned meant that proof set orders for the 1958 set fell because of the recession during the order period. And that in the typical numismatic scarcity judgment made that set a better one compared to the year before or after. In short, the hobby always seems to make lemonade out of lemons. Silver dollars continued to rise after the stock market crash of 1987 right into 1989.

For good or ill, I was part of that 1963 collecting herd. I am part of that herd now. What happens today I don’t know, but the hobby will always be here for me. It will stay interesting, it will have its ups and downs and I will continue to go with it and perhaps complain a little about the Mint increasing the cost of the silver Eagle.

See? The collector in me never leaves.