Dollar coins costly for banks to inventory

I enjoy reading the “Letters” and “Viewpoint” sections of NN and I finally feel compelled to address some of the common themes of those sections. I think I can offer a perspective not commonly voiced.

I would be considered a young collector, not to read uneducated collector. I’m 20. I am also a part-time employee at a local Pittsburgh-based bank. I think both of these factors place me in an interesting position on two topics I’d like to target, the issue of the dollar coin and the ongoing debate about “imperfect” coins.

Let me begin with the dollar issue. I believe that some readers forget one important point with the banking industry. Your local bank is a business and just like every profit-based business operating in a free market, profit is the bottom line. The state quarter program is (was) a huge hit. As soon as our shipment of the new design hit the vault they were almost instantly gone, and even if the bank ordered more than collector demand warranted, we’d simply use them with everyday banking transactions.

However, the dollar coin is anything but a hit. The dollar coin comes in boxes of $1,000 in individual rolls of $25 and must be ordered in increments of $1,000. These boxes take up vault space. A roll costs $25, two and one-half times the price of the role of state quarters, the preferred method to acquire the new design. With new designs coming out every few months, these boxes begin to take up valuable vault space because supply simply outweighed collector demand. Furthermore, unless requested, a teller will not pay out the dollar coins in day-to-day transactions like they would the quarters because customers as a whole prefer the bill. So, after the bank pays to have the boxes shipped and stored, the coins are broken down from the Fed rolls and put into bags of $2,000 and shipped back to the supplier. This all costs the bank in both money and time. These costs are passed onto the account holders in the form of fees, lower rates on deposit accounts and higher rates on loan accounts.

Secondly, I’d like to discuss the issue of “imperfect” coins. Imperfection is a relative concept, is it not? Who am I to pass judgment on a fellow collector based on their collection? The recent poll by NN argues that a majority of numismatists collect for enjoyment/knowledge and not profit. Some prefer the nostalgia of “Where and with whom could this coin have been?” that only circulated coins can provide. I don’t think there’s anything wrong with that. I believe my early interest in numismatics was the foundation of my further interest in banking/finance and thus my current pursuit of a finance degree in college. So, personally, coin collecting goes even deeper than only enjoyment.

Sure, I love collecting Mint State examples and I think a Mint State Seated Liberty design is one of the most beautiful, but those are examples, not a set. I believe I speak for most of the collecting community when I say that a Mint State set is improbable if not impossible for many coin types. I enjoy the hunt just as much as I love the design. I love hunting for G to VG Barber halves to complete a set or just attending a show and seeing an item that starts me on a new adventure. Each coin has its own story and I don’t just mean historically. How many of us can say “I remembered finding this coin at...” or “I remember the conversation with the dealer…” etc?

This brings me to one issue I’ll briefly touch on, dealers. I don’t know if it’s my age, but very often I’m brushed off, not greeted, or just blatantly ignored by dealers at coin shows. I don’t care if you’re selling an item I need for my collection, depending on the dealers’ attitude, I won’t even make an inquiry. Remember, I’m the customer; you need me, not visa versa. On the other hand, there are great dealers. These dealers keep younger collectors like me coming back.

I just recently attended a show where I experienced rude dealers, but also very welcoming dealers. For example, I always thought the 1922 $20 gold certificate to be a very gorgeous note. I had never purchased a banknote and in this particular field I am indeed a novice. The dealer was welcoming, carried on a conversation and explained how the note is graded, even retrieved a grey sheet (if that’s what they use to price bank notes) and showed me how the note was priced. Needless to say, I purchased the note and furthermore, I’ll look for him at future shows.

Don’t worry about young numismatists becoming discouraged by “bad apple” dealers. Take it upon yourself as a fellow collector or dealer to outnumber the “bad apples” and we’ll keep coming back.

Jarrett Briscoe is a hobbyist from Pittsburgh, Pa.

Viewpoint is a forum for the expression of opinion on a variety of numismatic subjects. The opinions expressed here are not necessarily those of Numismatic News.
To have your opinion considered for Viewpoint, write to David C. Harper, Editor, Numismatic News, 700 E. State St., Iola, WI 54990. Send e-mail to david.harper@fwpubs.com.