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Will Rise In Interest Rates Lower Values / Prices For Coins?

 
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Author Previous TopicReplies: 6 / Views: 551Next Topic  
Valued Member

United States
161 Posts
 Posted 06/16/2022  4:02 pm Show Profile   Bookmark this topic Add Hidalgo to your friends list Get a Link to this Message
The Federal Reserve recently raised interest rates by 0.75% to tackle inflation. There are plans to increase interest rates in the coming months. The public will be buying less, as the cost of borrowing money increases.

Do you think that the increase in interest rates will impact coin purchases? Do you think that the value of coins will fall? If so, I may wait awhile to buy some expensive coins.

*** Moved by Staff to a more appropriate forum. ***
Pillar of the Community
United States
6485 Posts
 Posted 06/16/2022  5:13 pm  Show Profile   Bookmark this reply Add westernsky to your friends list Get a Link to this Reply
I don't think there is a crystal ball available that can give you the answers you are looking far.

Your best bet is to go with your gut feelings and buy what YOU feel is a good value for what YOU have been searching for.
Pillar of the Community
United States
5253 Posts
 Posted 06/16/2022  7:33 pm  Show Profile   Bookmark this reply Add macmercury to your friends list Get a Link to this Reply
With inflation everything just get pricier that's the way I see things are lately, I just buy it within my budget because not seeing prices going down but will stable after this phase.

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Australia
14514 Posts
 Posted 06/16/2022  9:04 pm  Show Profile   Bookmark this reply Add Sap to your friends list Get a Link to this Reply
Inflation tends to make the price of everything increase, or, from another point of view, the value of the currency falls so you need more of it to buy the same things. So I would thus expect the price of coins to go up during a period of inflation.

As for the immediate impact of rate rises, it's my observation that even in the good times of near-zero interest rates, people generally don't borrow money in order to buy coins. Most people who buy coins, are wealthy enough to have "spare money" to spend on non-essentials, and they are choosing to spend that spare money on coins. Struggling families with low incomes, high debt levels and high mortgage repayments generally aren't big buyers of coins. High interest rates theoretically will eventually flow on to increased interest payments on saved money, which should mean that those wealthy enough to be earning interest, should be able to earn more interest and thus have more money to spend. Which is of course eventually counteracted by the inflationary cycle raising the prices of everything, but in the medium term, the top end of town has more free money available, which will in turn lead to higher demand and thus a higher-than-baseline-inflation-rate price increase for luxury non-essentials like coins.

So my recommendation would be to by now, and sell later.

Of course, if everyone follows this advice, it becomes a self-fulfilling prophecy.
Don't say "infinitely" when you mean "very"; otherwise, you'll have no word left when you want to talk about something really infinite. - C. S. Lewis
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Canada
4315 Posts
 Posted 06/16/2022  11:13 pm  Show Profile   Check Pacificoin's eBay Listings Bookmark this reply Add Pacificoin to your friends list Get a Link to this Reply
Won't hurt the high end Coin Market one bit .
If someone is borrowing money to buy
Coins or any other alternative investment
Seriously needs to have a shrink examine
them .
We are however financially in for a world of hurt
Due to total fiscal incompetence of the part of all
governments
Valued Member
United States
227 Posts
 Posted 06/16/2022  11:21 pm  Show Profile   Bookmark this reply Add newguy22 to your friends list Get a Link to this Reply
High end will stay high, everything else will drop. I think people in the future will regard 2020-2022 as the benchmark of when all coins were priced high.

A lot of the coin shops by me are selling their morgans/peaces at $28-$31 a piece! I don't see how these prices can stay that high unless a lot of them are involved in money laundering
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United States
1305 Posts
 Posted 06/27/2022  10:48 pm  Show Profile   Bookmark this reply Add Ballyhoo to your friends list Get a Link to this Reply
Rare and key date coins will always find a home. These at worse should stabilize coming off a hot market over the past few years. It's the common coinage, the Great Collections and Heritage Auctions, which the working class bid on that may drop a bit. We have priorities, and coins aren't part of the equation during high inflation. Especially when throwing in skyrocketing fuel prices. Geesh. Just my thoughts.
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There are no problems only solutions - the late, great John Lennon
Edited by Ballyhoo
06/27/2022 10:50 pm
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