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.