Are Classic Semi-Rare Coins In A Bubble?

Didn't happen on silver Thursday, won't happen now.

Yeah, I'm not talking 3 or 10 years, I'm talking compared to 20 or 30 year trends. Looking at the 1970 to date is fascinating! Thanks for sharing this link.

So it's clear we were headed for a bubble when the mortgage crisis brought things back to normal. I think we're still a little bit high, but it's not as bad as I'd imagined. I'd love to see this chart broken out for different classes of coin. Really cool, thanks!

delaner: I notice that you are from the U.S.

I have collected World coins (and that means U.S.coins as well), and the rises in prices I perceive is not as great as you would perceive.

The reason for this has to do with the value of the U.S. dollar, vis a vis other currencies. Among others, the Australian dollar has risen against the U.S. dollar, and so the cost of imports (into Australia) from the U.S., contracted in U.S. dollar values, is less.

A few years ago, one Australian dollar would buy me 65 U.S. cents. I can now buy 105 U.S. cents with my Australian dollar.

So, adding U.S. coins to my World collection is the right thing for me to do just now. I perceive them to be cheaper to buy than they were.

I guess that you would perceive the opposite to me.

That can be OK for you, too! It means that you can buy coins in the U.S. and can sell them back into your own market at a profit, as the U.S. dollar falls in value.

I have used exactly that strategy myself in the past, with the Australian dollar.

A falling value U.S. dollar means that America can pay off some of it's debts with smaller sized dollars. I have used that strategy, (with Australian dollars), years ago to pay off my mortgage faster.


So you don't even have to be a foreign currency dealer to take advantage of situations like this!

Something to consider on that 1970 to date graph, the index is supposed to show the market for PCGS graded coins and PCGS didn't exist before 1986. So all the data before 1986 is questionable. You can't tell if the pricing data used for the coins in that period would be for coins in the same grade that PCGS would have graded them. So it is best to just use the 1986 and later part of the graph. And if you do that you will notice that according to the index coins today are just about the same price as they were 25 years ago. They reached a post-bust low of a round 55000 in July of 94 and today after 17 years they are around 67500, an increase of about 23%. Or an annualized growth rate of just about 1.2% per annum. The index would have to be at 88,259 to just break even with inflation since the low point. So the PCGS3000 index seems to show that coins are not a great investment.

delaner: You are right: very few coins are investment grade. Those coins are the stars of numismaics. And like most investments, you need to hold on to them for 10 years ore more. Easy if you are a lifetime numistmatist.

I had such a star: the Adelaide Pound of 1852. I bought it for $250, sold it for $1,500 ten years later. It was part of a collection of Roman and Australian coins, and they paid for the down payment on my first house.

If I still had that coin now, it would command $15,000 at auction.

I have a few individually quite valuable coins now, but no 'stars' of Australian numismatics.

There is a certain tendency for fine arts investments (that includes coins), to be counter cyclical to other investments, such as shares real estate and bonds, and even cash deposits.

When there is a general nosedive in all market categories, as happened with the GFC, bullion and fine arts become a 'safe haven' for a small proportion of an investor's assets. Fortunately, I have noticed that the value of my collection has remained firm when other market categories get going again.

All very interesting. Like a lot of other CCF'ers, I don't really classify myself as a numismatic investor. I just collect and study coins, because that is part of who I am.