MARKET MATTERS - Quality Rules

By Vic Bozarth

Hindsight is 20/20, so goes the old adage, but our vision blurs when looking forward. One of the biggest factors with which to indulge in this prognostication is to remain conscious of the lessons the past has taught us. Within the rare coin market itself are dozens of components that move independently of each other. Did we listen?

The rare coin market remains strong, yet stagnation of demand and over supply are dogging some areas of the market. Condition-census coins are not part of this group. Indeed very few dated collector coins are included in this category either. Scarce and rare coins are not suffering from lack of demand because these coins are never available in any large quantity.

As an example, if you wanted to spend $25,000 at a major coin show on only dated Liberty Seated and Barber coinage PCGS graded in the VF20 to AU58 range, you would be hard pressed to spend all your money. When it comes right down to it, many high-end collector coins never make it past the first day of a show. And, if a dealer locates one, they have sold it already at home.

Yes, the price is important, but the supply/demand curve for high-end collector coins has been upside down since 2020. If you can find one, it’s saleable. Dealers especially will snap up any rare coin that represents good value. As a rare coin buyer, I never hesitated when the value of an item was readily apparent. Regardless of whether this item was something my company handled, the sheer lack of availability (and a fair price) usually led to my purchase.

Somebody will need this coin, and profit is profit!

Some vintage coins, such as this 1910 Barber Half Dollar graded PCGS VF20, represent the kind of choice collector material that can be difficult to find on the market in great numbers. Demand for such pieces is simply sky high. Courtesy of PCGS TrueView.

One of the biggest secrets of the rare coin market is the fact that a ready supply of any one item is good for the seller, but not for the buyer in the long term. Rare coins are not widgets, yet some rare coins are marketed based more on an ability to obtain inventory to sell than the consideration of rarity or value to the customer. Especially coin dealers who depend on having plenty of inventory in their wagon to market have been forced to sell what they can buy versus more desirable rare coins.

Just like major retailers whose inventories suffered early in the COVID-19 pandemic because of lack of supply, major coin marketers have had to modify what they sell, too. Are these telemarketed coins a bad deal? Not necessarily, but the whole supply/demand curve argues against generic items being a good deal. Coin dealers, just like major retailers, have in some cases loaded up on inventory to sell without giving much thought to the rarity of the item. Finding rare coins is hard, but loading up on more generic items isn’t.

There is no question some heavily marketed items have plateaued. Inventories are sufficient for the programs currently running. Any time when active buyers stop buying, arguably the price should fall. While I don’t see a lot of prices falling, the market for “stuff” is certainly softer going into 2023.

Heed the lessons of the past when looking forward. Sure, you might strike out and not buy many coins. But if you focus on value, you are assured of greater potential value later!

Vic Bozarth is a familiar face on the bourse floor to many who have attended coin shows over the last five decades. He’s a self-described “coin weenie” who has attended more than 1,000 shows and vast experience both buying and selling many of the finest PCGS coins. His numismatic knowledge as a dealer and collector provides a unique perspective on our industry.