Sunday, August 28, 2016

The Al Boka Large Cents - Keep an Eye on These Coins!

Heritage Auctions will sell the Al Boka Collection of 1794 Large Cents on Sept. 8, 2016. This is sure to be a notable auction of a very significant specialized collection. In spite of the brevity of the sale (just 58 coins), a number of very important early U.S. Cents will find new homes.
The Boka Collection is literally filled with important coins from 1794. Yet, for me there are a handful that stand out, even among this stellar group. Below are my personal favorites, along with my reason(s) for liking them so much:

LOT 5302 1794 S-18b (Head of 93) - This coin is not only rare (the variety is rated R4) but it is beautiful. The color and surfaces are virtually without fault. It is rated as the 5th-finest known, and is without doubt one of the finest "Heads-of-93" you will ever encounter!

LOT 5320 1794 S-35 - The second finest known coin for the variety, and the finest available to collectors (Coin#1 is impounded in the ANS Collection). S-35 is quite scarce overall (rated R5). This coin represents the latest known die-state, with a prominent crack bisecting the obverse in spectacular fashion.

LOT 5333 1794 S-48 - The Discovery Coin for the famous "Starred Reverse" 1794 Cent. This distinction (as the discovery specimen) elevates this coin to superstar status among all large cents. In addition, the coin itself is quite impressive. It is the 5th finest known, and all of the famous stars on the rev. are prominently displayed. What a Wonder Coin!

LOT 5343 1794 S-58 - The aspect of this coin that sets it apart is not its overall rarity (the variety is just R3), but rather its stellar condition. Rated as MS60 by EAC standards (PCGS MS62), this coin stands alone atop the condition census for S-58.

LOT 5351 1794 S-66 - The Boka S-66 is the finest known for the variety, in spite of its modest grade (VF25 by EAC standards). The variety is quite scarce overall (R5). The S-66 is known as the "Split Pole" variety, due to a die-break that develops along the forward extension of the pole in front of Miss Liberty's neck. The Boka coin exhibits a very prominent split pole, along with superb color and above average surfaces.


Thursday, June 16, 2016

The challenges for coin collectors

Coin collecting is a hobby, right? It is meant to be relaxing and fun, Right?
Well, that is probably the right way to think about it. That was probably the way it felt for most of us in the beginning. But, things never stand still, and always move forward. Coins can appreciate in value with time. Prudent purchases of rare coins can turn out to be wise investments. Knowledge is power, and all that.
Looking back to my own numismatic awakenings, I now see that period of time as very different for collectors from the present. It was the early 1980's. Rare coins were available, but you had to physically "go and hunt" for them. There were coin shops and coin shows, but there was no internet marketplace. The only grading service was ANACS, and they were issuing certificates (not using encapsulation). Grading standards were "fluid" (to say the least).
Fast forward a few years, and the rare coin market began to flourish, with confidence injected by PCGS and other 3rd-party graders. Coin grading accuracy became a paramount concern. The value of Grade vs. Rarity was debated. The term "Condition Rarity" was invented. On-line price guides, together with a plethora of specialized reference books resulted in an explosion of available information. Knowledge was still power.
The coin market today is both wide-spread (thanks to national auction companies and the internet), and highly specialized (Early copper, Morgan Dollars, FBL Franklins, FSB Mercuries, etc.). We have come a long way (I will leave it to others to debate whether we have made progress, or have moved backwards - that is a moot point, as we are here now).
In spite of all this apparent progress (eg. change), I think there are existential threats to the coin market that are too big to be ignored. Here (in random order), are some of the ominous trends I see just ahead:
1. Coin use is in decline. Demand for circulating U.S. coins is in a long-term downward trend. This trend is being driven not just by the increasing cost of making the coins, but by the increasing use of debit cards (and other technology) as an alternative to cash. You may argue that this trend is not relevant to collectible coins, which are rare & desirable objects in their own right. There is some truth to this. However, this argument fails to address the longer term issue: who will want to collect coins when there is no one alive with direct experience with their use in daily life?
2. Coin collectors are aging. I do not have any handy statistic to quote regarding the median age of the U.S. coin collector population. However, I have anecdotal evidence that tells me two things: One - the collector base is largely male. Two - the collector base is aging. The problem for the coin market is compound: not only are the current owners of rare coins reaching the age where they wish to sell their collections, but the size of the collector base to absorb those coins is shrinking. Basic economics (supply vs. demand) can readily predict the outcome of such a scenario: lower prices for rare coins!
3. Grading standards are not fixed. I realize it is heresy to say that grading standards have changed (after all, we call them "standards" don't we?). But, let us not shrink from the fact that the third-party grading services (TPG) practice "market grading" vs. "technical grading". Technical grading standards should remain the same. But there are Bull markets for coins (when prices are increasing), and there are Bear markets (when prices stay flat or decrease). It is commonly accepted that market grading standards become more liberal during bull markets and more conservative during bears. Yesterday's MS64 is today's MS63, and the old VF20 is now F15, etc. Coins that are graded & encapsulated in TPG holders during Bull markets still carry that optimistic grade, but will not command the same market price during a Bear market. The result is typically lower bid prices. The lower bids are duly noted and reported by the price guides, and the downward spiral of prices is amplified. Naturally, the converse of this process can also occur when the market cycle turns from bust-to-boom again. However, savvy dealers and collectors know how to remedy that situation - they simply "crack out" all the conservatively graded coins and resubmit them for higher Bull market grades!
4. Costs keep rising. Table rent at coin shows is higher. Airline tickets and hotel rooms also get more expensive over time. The coin dealer is now being squeezed. Costs are heading higher, but the prices collectors are willing to pay for the products do not seem to be moving up at the same rate. The only answer for the dealer is to seek more on-line business, and limit travel to coin shows. This will invariably lead to fewer coin shows, and concentration of activity at the few "premier" shows that survive.

Conclusion: I apologize if this post seems overly pessimistic. I still enjoy collecting coins, and I consider it a terrific hobby and pastime. I wonder how many people in the U.S. will know what purpose coins serve in 2066?


Monday, February 1, 2016

Tom Reynolds Large Cents - Thanks for the Memories!

Well, the auction of the Tom Reynolds large cents is now in the books. It was a memorable sale that falls just short of the legendary category.
There were a lot of memorable coins in the sale. The venue for the auction was the Intercontinental Hotel in West L.A., which proved to be a very comfortable and inviting place for a coin sale. The pre-sale publicity was well handled, and the cataloging & photography of the auction lots was masterfully done.
All of this positive energy was countered by a sagging coin market, and the stock market turmoil of the past month. The net result was a coin sale in which a large number of important early large cents traded hands without great fanfare, and without many new price records.
My impressions from the Reynolds auction are shared below (in random order):


  • There were no million dollar coins in this sale (and, none were expected). Five lots did pierce the $100K mark [a 1793 Chain Cent (LOT-1), a choice 1793 S9 Wreath Cent in PCGS MS65BN (LOT-3), another 1793 Wreath S-10 in PCGS MS64BN (LOT-5), a stunning 1798 Draped Bust Cent with Rev. of 1795 (S155) in unsurpassed PCGS MS65BN (LOT-141), and a remarkable 1809 Classic Head Cent (LOT-311)].
  • By my count, 131 of the 332 numismatic lots in the Reynolds sale brought a hammer price lower than the pre-sale estimate. There are a number of possible explanations for this occurrence, but the simplest (and most defensible) is that the estimates were formulated at an earlier time, when the coin market was in better health. Obviously, a year-long decline in commodity prices, and the poor performance turned in by the U.S. equities market in Jan. 2016 had an impact on the confidence of rare coin buyers.
  • Some dates and some series fared better than others. The prices realized by 1793 cents were more-or-less in line with my expectations. 1794 cents did rather well, as the collector base for this date is quite strong, and this sale offered a unique opportunity to bid for condition census pieces. To my surprise, cents from 1796 were rather weak. I am not sure how to explain the paltry prices realized by the cents from this year, and I will need to do some more research on this topic. Prices for Draped Bust cents (1796-1807) were generally soft, although a few exceptional pieces created a bidding frenzy. Classic Head coins (1808-1814) seemed to be in ascendancy, with strong bidding observed for all but the most common varieties.
  • Throughout the past year, there have been comments (verbal and written) among early copper enthusiasts, that collecting of early date cents by Sheldon variety, with the aim of completing the entire series was no longer popular. According to these theorists, a full Sheldon set had become prohibitively expensive, and younger collectors were more interested in high-grade date sets or specialized (eg. Red Book) sets of cents. The results from this auction proved that variety collecting remains very much alive. To cite just a few examples: LOT-9,  a 1793 S-12 (R6) in PCGS G-6 was hammered for $22K (more than double the estimate of $10K). LOT-23, a 1794 S-33 (R6), the famous "Wheel-spoke Reverse" in PCGS VG-8 hammered for $23K (vs. estimate of $15K). LOT-122, a 1798 S-144 (R5+) in PCGS VG-8 hammered for $7750 (vs. estimate of $5000). Finally, LOT-242, an 1801 S217 (R6+) in PCGS F-12 (and #8 in the condition census) hammered for $14,500 (the estimate was $15,000).
  • Easily the biggest upside surprise of this sale (for me) was provided by LOT-271. An 1807 S-274 (R2) in PCGS AU-53 with a pre-sale estimate of $6000 soared all the way to a hammer price of $46,000! I later learned that the reason for this stellar performance was competition among PCGS set registry collectors. Not far behind this surprise was LOT-222. An 1800 S-201 (R4+) graded VF-30 by PCGS with a pre-sale estimate of $2000. The hammer price for this coin was $10,500!
  • The biggest downside surprise in the sale was provided by LOT-216. A rare variety of 1800/79 overdate (S-195 / R5) graded EF-40 by PCGS. This coin was hammered for $3300 vs. a pre-sale estimate of $10,000! Perhaps the new owner feels good about getting a bargain. Right behind this coin on the downside was LOT-54. A 1795 Liberty Cap cent (S-76a / R5) graded EF-45 by PCGS, but with numerous rim nicks. This coin hammered for $5000 vs. an estimate of $15,000. It is interesting to note that a similar situation arose when the Paul Gerrie 1795 S76a was sold by Goldbergs in 2013.


  • Saturday, November 28, 2015

    Coming Attractions - The Tom Reynolds Large Cents !

    The Goldbergs are making plans to sell the Tom Reynolds coins (Part-1) in late Jan. 2016. Based upon the early press releases, and published images of coins included in the sale, this auction promises to become one of the "whales" of early copper collection sales.
    However, there is one significant difference between the Reynolds auction, and those of other legendary early copper figures like Robbie Brown, Walter Husak, Dan Holmes, and R. Tettenhorst (The Missouri Cabinet half cents): The difference involves the breadth of the collection. While the focus of the earlier legendary collectors just mentioned was BOTH completeness and quality, the Reynolds coins generally represent the single dimension of high quality.
    There are certainly some rare coins in the Reynolds offering - a 1793 S-12 (R6-) is included, along with an 1801 S-217 (R6+), and a number of NC varieties from multiple years. However, it is obvious that completion in terms of all Sheldon varieties was not an aim for this collection (with the possible exception of the year 1798, which has been a particular passion for Reynolds).
    With that said, there will be a lot of memorable coins in the Reynolds auction: There are at least 7 mint-state 1794 cents, and more than 30 mint-state 1798's (roughly half the PCGS population of MS coins for this date)! Many "finest-known" coins (for the variety) should bring strong bids from quality conscious buyers.
    I am making plans to be "in the room" when this sale gets hammered!

    The link below should provide a preview of some of the top coins in the Reynolds sale:
    http://www.goldbergcoins.com/Reynolds_coins

    Sunday, July 12, 2015

    EAC Convention 2015 - A Retrospective


    The 2015 EAC convention was held from April 30 to May 2 in Dallas Tx. I was fortunate enough to attend, and enjoyed three full days talking to fellow copper collectors and looking at early copper. These annual events both strengthen the organization of Early American Coppers and reinforce the positive aspects of coin collecting for each member who attends.

    Upon arriving at the hotel, I was informed that the folks from Stacks/Bowers were already set up in a 1st-floor conference room with coins from the Twin Leaf collection. The best way to begin was spending an hour browsing through this premier collection of middle-date and late-date U.S. cents. I was not disappointed - there are some fantastic coins in this collection.

    Thurs. evening brought the EAC reception, which was well attended and had a great selection of tasty mini entrees. I re-connected with many old friends who seem to "appear" at this event each year. Following the reception, the half cent and large cent "Happenings" were conducted in a pair of nearby conference rooms. It took two hours to check out all the featured varieties, and swap some copper tales with fellow EAC'ers. One of the featured cent varieties, 1839 N12 had two nice coins that vied for 1st place in my mind. The variety that provoked the most discussion was 1852 N11, where numerous examples displayed cuds (or folded extra metal) at various different locations on the obverse rim. A number of experts contemplated the mystery posed by these aged disks of copper.

    Friday was filled with a number of cuprous activities; the perusal of the bourse floor was very casual, since I did not have any particular coins on my "want list". The Heritage Auctions display of coins from the Eugene Exman Collection struck me as one of the nicest groups of early cents from old-line collectors seen since the Dan Holmes collection (sold in 2009). Lot viewing for the EAC auction (to be held Sat. night) was an important activity. I attended a few of the presentations in the educational forum - the discussion of the contents of the 1795 Massachusetts State House Cornerstone by John Kraljevich was memorable.

    Saturday was mostly consumed with more camaraderie, along with a few swaps and sales of coins. At last, Saturday evening brought the long-anticipated EAC auction. For many members, this auction is the highlight of the convention. This year’s sale did not contain any “wonder coins”, but it was packed with collectible and affordable copper. In the early going, I was delighted when a low-grade 1793 Chain cent was hammered to me. This coin was destined to be a gift to an exceptional friend who briefly owned a chain back in 1989, but has been without one since then. Later in the sale, I outbid another buddy (and went over my budget) to buy a sharp 1839 N14 (Booby Head) cent. I have no regrets, as the pleasure of owning this beautiful coin has outlasted the pain of paying for it.

     And, just that fast, it was all over for another year! I brought home a few nice copper coins and added to my collection of good memories. Only 10 more months to wait for EAC 2016!

    Tuesday, February 17, 2015

    Directions in Copper - where from here?

    The Greek Philosopher Heraclitus is credited with the famous quote "Change is the Only Constant"*
    *this is loosely translated from the Greek, which has also been interpreted as "Everything changes and nothing stands still"
    Things may change less rapidly in the world of coin collecting than in other human endeavors, yet change they will.

    This past year has witnessed some remarkable milestones in U.S. copper coins, with important implications for those with an interest in these series:
  • In Jan. 2014, the sale of the Missouri Cabinet collection by Ira & Larry Goldberg established numerous price records for U.S. half cents, including the first two half cents to sell at auction for at least $1 Million. The sale was reported in this blog, and in the on-line story  below:

  • http://news.coinupdate.com/missouri-cabinet-half-cent-collection-auction-results-3128/
      
  • Just last month, not one, but two early copper coins broke through the $2 Million mark. The first of these was the fantastic 1792 Birch Cent (NGC graded MS65). The second coin, from the same Heritage auction was the finest graded 1793 Chain Cent (PCGS graded MS66). These results have been reported in the on-line story below:

  • http://news.coinupdate.com/birch-cent-leads-heritage-fun-auctions-4655/


    In most respects, the copper coin market has been holding up very well, and is apparently thriving, along with the markets for U.S. equities and real estate in most places.
    However, it is often worthwhile to look beyond the headlines, and get "beneath the surface" in order to understand the dynamics of a complex market. Not every sector of the copper market is on the upswing.
    While the stellar collections and high-grade rarities have been grabbing the coin news headlines, another more insidious trend has also emerged. Prices for many rare coins in less-than-flawless condition have languished or even declined recently. What could be causing this apparent contradictory behavior? Here are a couple of thoughts:

  • The Quest for the Best - Nothing is particularly new about this trend. People have always tended to want the best, whether it is for their morning cup of coffee, their home, their car, or the coins in their collection. Popular coin publications even suggest that, when selecting a coin, we should aim for the "Best You Can Afford". What has changed is the intensity with which this sentiment is now pursued. Everyone cares about the "finest known" for a coin type or variety. Apparently being in 2nd place is simply being 2nd-class! The third-party grading services have aided and abetted this trend, by publishing population reports and establishing set registries, to encourage the race to the top. Uncertified coins have become "suspect", and are presumed to have problems that prevent them from being graded. Being at the "top of the pop" gives a coin the added marketing buzz needed to justify its astronomic price level. The only problem is: if everyone wants only the best, who is left to want the rest?


  • New Collecting Strategies - Higher coin prices are good for those selling, and also for those who already own the coins. For those who are still collecting, higher prices mean one of two things: either you will collect fewer coins, or you will collect more low-grade coins. And, since we have already mentioned the "quest for the best" trend (see above), most collectors are making the rational choice to limit the size of their collections. Most are choosing some specialty area to focus on - whether it is coins from one particular year (1794, for example), or a copper type coin set, or a collection with a special theme (coins previously owned by famous numismatists, etc.)


  • Most collectors of early copper are familiar with the Sheldon rarity scale. This logarithmic scale classifies the scarcity of copper coins into eight levels, running from R1 (common, >2000 known) to R8 (unique, 1-3 known). There are a number of early copper coins that have traditionally been highly revered and eagerly sought for being considered scarce (at least R5 or higher, with fewer than 75 examples known). These coins were considered "necessary" for a full collection, and they were sought in all grades for inclusion in collections. But lately, these coins have been pinched on both sides of the economic equation: On the demand side, there are fewer collectors trying to obtain a "full" set, especially a set in low grade. On the supply side, more coins have emerged on ebay and other internet sites. The net effect has been soft demand for these formerly desirable scarce varieties. This is neither good nor bad, but just "the way it is". The driving forces behind this trend do not look like short-term phenomena. This is the new reality with which copper collectors should learn to live.

    Tuesday, April 15, 2014

    A New Grading Guide for Early American Copper Coins

    Finally there is a coin grading guide written by collectors of Early American Copper for collectors of Early American Copper. This recently published 192 page hard cover book describes and illustrates how to grade Confederation era Colonial coins as well as U.S. half cents and large cents, using the standards evolved by members of the Early American Coppers club.

    Chapters in this new grading guide are devoted to sharpness grading for each of the various series, net grading (as practiced within EAC), specific characteristics of many die varieties, comparisons between commercial grades and EAC grades, authentication, the history of coin grading, and discussion of the many factors that can influence the price of a copper coin.

    The volume is profusely illustrated with vibrant color images. It should provide both entertaining reading, and a valuable reference for any numismatic library. For more information, and the opportunity to order a copy of this grading guide, just visit the Early American Coppers web site, here:
    http://www.eacs.org/GradingGuide/GradingGuide.html