| Author |
 Replies: 9 / Views: 1,501 |
|
|
Pillar of the Community
United States
851 Posts |
What are your opinions on the collapsing economy. Do you think coins like my 1889 CC Morgan will collapse in value. Should I sell some of my coins that have only numismatic/rarity contributing to their value and put it into coins such as double eagles that have both numismatic and metal value? 
|
|
|
|
Pillar of the Community
United States
2734 Posts |
Quote:
Do you think coins like my 1889 CC Morgan will collapse in value? No. Slightly decrease? Possibly. I would keep it, myself. Quote:
Should I sell some of my coins that have only numismatic/rarity
value and put it into coins such as Double Eagles that have both
numismatic and (bullion) value? Not a bad idea!  However, key date coins (either copper-majority or silver) have proven to be very good long-term investments in general. If you want a key date gold coin (ie: 1911-D Quarter Eagle), now would be a good time to get it! |
|
Pillar of the Community
 United States
851 Posts |
I was amazed to see the 1904 MS-63 Double Eagle I bought no more than 6 months ago jumped from the 1950 I paid for it, all the way to 3250 on Numismedia's price guide. I saw some in the past week sell for 2600+ on ebay. Nice little profit on my investment when I go to sell it in my opinion.  |
|
Pillar of the Community
United States
968 Posts |
If you are trying to make an economic investment I'd suggest separating it from your hobby. By that I mean, if you think the price of gold will continue to rise then buy gold bullion. Buying gold coins throws the numismatic element into the mix. And if your worry is that your Morgan value will collapse because the bottom will drop out of the numismatic market, then why wouldn't the same thing happen to the numismatic value of gold coins?
Say you buy a double eagle for $1500. As it is 90% gold and the current rate is $1219 per oz., the gold value of the coin is $1100 ($1097 to be exact!). Therefore you are paying a $400 premium for the coin due to its numismatic value. If the numismatic market collapses and coins lose 50% of their numismatic value then your coin would be worth $1300 and you lost $200. Gold would have to go up over $200 per oz. more in that scenario just for you to break even.
In the scenario where gold prices drop and numismatic value stays the same you are worse off buying the gold coin. The reason is that the numismatic value of the gold coin is only 20% of the total value. I don't know the condition of your Morgan, but for the sake of discussion lets say it is in XF condition and has a value of $3500. With silver at $19 dollars per oz. even a total collapse of the silver market has no real effect on the value of your coin.
|
|
Valued Member
United States
436 Posts |
 My coins are my hobby, and at least for now have no desire to unload a single one! I buy generic silver bars as investments, but like to keep my business business and my fun fun! |
|
Pillar of the Community
United States
1418 Posts |
Here is my take: People are melting coins for their metal, so coins will become rarer, and higher in value.
|
|
Bedrock of the Community
United States
10982 Posts |
Quote:
As it is 90% gold and the current rate is $1219 per oz., the gold value of the coin is $1100 ($1097 to be exact!). To correct this: Double Eagles contain 0.9675 ozs of pure gold. At $1219/gold their gold value alone is $1,179. They always carry a premium though and your MS63, if top tier certified, is currently trading at well over 2X melt or around $2,600-$2,700. Raw coins trade at much lower levels, sometimes going for as little as 10% over melt. I'd hang onto the CC and remember price guide pricing is usually only for PCGS/NGC certified coins at high retail levels. |
|
Pillar of the Community
United States
968 Posts |
Thanks for correcting my error on the gold content of the coin, I guess I ought to look these things up instead of just going by my faulty memory!
Regardless of what value you use for the coins, if you (OP) believe your original premise will come to pass (i.e. the numismatic value of coins will "collapse") then it doesn't make sense to go from one numismatic coin to another. You would be safer investing in bullion that has a 1:1 relationship with the price of gold.
That being said... I'd rather have a coin with a high numismatic value as I don't think prices will collapse. The higher the numismatic value of a coin relative to its metal content value, the less it will vary in price due to fluctuations in raw precious metal prices.
|
|
Bedrock of the Community
United States
20753 Posts |
Quote:
My coins are my hobby, and at least for now have no desire to unload a single one! I buy generic silver bars as investments, but like to keep my business business and my fun fun!
Same with me. Quote:
Here is my take: People are melting coins for their metal, so coins will become rarer, and higher in value. I suspect that is more true than people think right now. As to the original question, note the economy is poor right now but as in the past, starting to recover. I've seen the economy go up and down many times in my life time. As for coins, not the down part at all. Yes there are some coins that have dropped in prices but as a general rule, this hobby is growing and as it does, general coin prices will continue to go up. Remember that the population of the USA is now 300,000,000 and still growing. With such a population growth, so are the amount of coin collectors making the prices of coins go up and up and up. Think about the fact that if only 1% of those present now collect coins, that is still 3,000,000 that want a coin with a mintage of 2,000,000 or much less. |
|
Pillar of the Community
United States
2734 Posts |
Quote:
With silver at $19 dollars per oz. even a total collapse of the
silver market has no real effect on the value of your (1889-CC). Exactly! Key date silver coins will have numismatic value, even if space aliens land at the White House and hand out free 1000-oz. silver bars to everyone in the crowd...  That's one of the only two scenarios I can think of right now that would cause the price of silver to collapse. The other: If it became technologically possible to synthesize silver from other cheaper metals (in other words, 'alchemy' at last!). Even then, 'junk silver' would still be worth face value! Remember: The 1909-S VDB Cent has only 2¢ worth of copper in it!  |
| |
Replies: 9 / Views: 1,501 |
|
Posted 12/02/2009 5:59 pm
