Today's Best Opportunities in Rare Coins !
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Volume 9 Issue 11 Liberty Coin Service’s Monthly Review of Precious Metals and Numismatics November 5, 2003 Take Advantage Of The Boom: Today’s Best Opportunities In Rare Coins ! P.4 Platinum Continues To Rise, Hits 23-Year High! The gold and silver markets are 10-year program, The Track Record I advised you going through episodes of profit- January 1, 1999 to October 31, 2003 taking and retrenchments that are that this would be the spark to and January 1, 2003 to October 31, 2003 normal in a developing bull market. There’s not much fresh news. So I the next rare coin Percentage Change boom. 1/1/99-10/31/03 2003 YTD will take the opportunity to step back and take a longer view at what It is now al- Precious Metals is happening in the rare coin mar- most five years Platinum +102.5% +23.4% ket. since the Dela- Gold + 33.1% +10.6% Silver + 1.1% + 5.4% Like other markets, rare coins go ware quarters led through cycles. Each peak is typi- off the series of Numismatics US Proof Silver Eagles, 1986-1998 +101.3% + 1.9% cally higher than the previous peak; Statehood quar- ters. US Silver Proof Sets, 1950-1964 +93.1% +14.9% the following market bottom tends LCS US Collector Key-Date Coin Index +65.8% +25.8% to be at higher levels than the pre- An analysis of US Non-silver Proof Sets, 1968-1998 +48.0% + 7.6% ceding bottom. market trends LCS US Collector Generic Coin Index +30.2% + 4.9% The last major market peak hit in since the begin- LCS US Large Paper Money Index +23.8%* + 5.9% June 1989 amid expectations of ning of 1999 MS-63 $20.00 Liberty +20.5% +14.4% LCS US Investor Better Date Coins Index + 9.1% + 4.4% massive demand from the creation shows the impact of the huge num- LCS US Investor Blue Chip Coin Index + 4.3% + 5.4% of Wall Street funds specifically for MS-63 $20.00 St Gaudens - 1.7% + 9.5% coin investments. ber of new coin MS-65 Morgan Dollar - 7.4% +16.3% Many of the coins that peaked collectors (most *compared to August 1998 back then were those available in recently esti- US Dollar vs Foreign Currencies relatively large quantities in high mated at 140 Mexico Peso +10.1% + 5.3% grade—the so-called generic or million by the India Rupee + 6.2% - 5.9% “Blue Chip” coins. U.S. Mint). Euro + 1.3% -10.5% China Renminbi 0.0% 0.0% In the following downturn, the By referring to what has hap- Great Britain Pound -1.9% -5.3% Blue Chips suffered greater losses Switzerland Franc -2.4% -3.2% than the better-date coins being pened at other Japan Yen -2.9% -8.0% pushed as investments. times in the past Australia Dollar -15.6% -25.8% when there was a Canada Dollar -16.6% -19.8% The everyday, run-of-the-mill col- lector coins largely avoided this major change in Stock Markets hype. They didn’t soar along with U.S. circulating Russell 2000 +25.2% +37.9% “investor coins” and did not crash coinage, we can Dow Jones Industrial Average + 6.7% +17.5% afterwards. In fact, even as the forecast with a NASDAQ -11.9% +44.7% S&P 500 -14.5% +19.4% Blue Chips were declining, these high degree of confidence what Tokyo Nikkei 225 -23.7% +23.1% coins were continuing their steady Frankfurt Xetra Dax -26.9% +26.4% lies ahead as the rise—and continued to do so almost across the board for the past 14 rare coin boom continues. years! When Congress passed legislation Inside this issue: The Track Record page 1 in 1997 for a new series of quarters A New Lincoln Cent Coming In 2007? page 2 to honor each of the 50 States over a Time To Sell Platinum? page 4 (Continued from page 1) common-date Morgan and Peace Silver ter and to most coin collectors, the The Rare Coin Boom Takes Dollars and Saints as well as a wide as- general public is largely unaware of Root—1999-2003 sortment of “made-to-order Instant Rari- this impending change. Within a few months of the appear- ties” (remember seeing Sunday paper When the public has another op- ance of the first Statehood quarter, a ads and cable sales channel programs portunity to collect interesting coins number of purchasers started show- offering privately-colored Silver Eagle out of circulation, being nickels this ing up at coin shops across the na- Dollars at $40-$50 apiece?). Although time, that will further increase inter- tion. They were excited about a se- there are a number of such ongoing pro- est in the preceding Jefferson, Buf- ries of quarters honoring each of the motions, today’s market is being driven falo, Liberty, and Shield Nickel se- 50 states, but were too enthusiastic by the grassroots collectors, not by the ries in particular, and in all U.S. to look forward to only a single new marketers. coins in general. coin every ten weeks for the next ten In reaction to the increase in the num- If hoped-for plans for changed de- years. ber of coin collectors, existing experi- signs for the 2007-2009 Lincoln What else could they collect that enced collectors stepped up efforts to Cent (to honor the bicentennial of did not require long waits to get finish collections before rising demand his birth) come to pass, that will fur- product—and were also affordable pushed up prices. In the process, they ther fuel a warming market. and beautiful? have contributed to a strong rise in the Whether or not the Lincoln Cent The most obvious items that at- prices of key-date collector coins such changes, here are my projections for tracted them were the modern Proof as the 1909-S VDB Lincoln Cent in different numismatic segments: Sets and Proof Silver Eagles. Prices Very Fine condition, the 1916-D Mer- US Proof Silver Eagles, Silver quickly began rising as dealer inven- cury Dime in Good condition, the 1916 Commemoratives 1982 to date, tories were depleted. Standing Liberty Quarter in Fine condi- and Proof Sets issued since 1950. I As you can see on the table on the tion, and the like. Our index tracking think most of the price increases previous page, prices of the Proof these coins shows that they have jumped have already happened. However, I Silver Eagles and modern-era Silver over 65% since the beginning of 1998, think it is more likely that there will Proof Sets have roughly doubled including a more than 25% increase in continue to be slight increases in the since the beginning of 1999. Even the past ten months! next few years rather than any sig- the non-silver Proof Sets from 1968 So, solid groundwork has been set for nificant decline. to 1998 are up almost 50%. An a strong boom in the rare coin market— Collector Key-Date Coins. I ex- analysis of modern US Silver Com- large numbers of new collectors, rising pect strong demand for at least the memoratives would almost certainly gold and silver markets, existing collec- next six months, followed by a ta- show this same result. tors becoming more aggressive at add- pering off among the coins that have Such coins outperformed gold and ing to the collections, and new coins experienced the greatest percentage silver and the stock markets over the (and also paper money) coming out on a increases in recent years such as al- same period, a fact not lost on new regular basis. most all Carson City issues, 1877 In- Where are we likely to go from here? dian Cents, 1909-S VDB and 1922 and old collectors and also on some from outside the hobby. The Rare Coin Boom Takes Lincoln Cents, 1937-D 3-leg Buffalo Nickels, and 1916-D Mercury The new collectors have also con- Off—2003-200? tributed to a major expansion in the Dimes. I do not expect any general There are even more coming events to fall in their prices, but they are likely demand for certified super-high- spark higher interest among potential grade modern coins at prices that to under-perform compared to other coin collectors. coins. leave old-time collectors shaking First, the U.S. Mint will issue two dif- their heads in amazement. The less well known key-date ferent circulating nickels next year in- coins, especially those from the 19th As new collectors become more stead of another edition of the current sophisticated in their numismatic Century are likely to fare better. design. The first one will commemorate Collector and Investor Better- knowledge, many of them will ex- the 1803 Louisiana Purchase. Then will pand their collections to include Date Coins. There are many dates come the first commemorative for the of coins that are definitely not com- more earlier series and issues, such 1803-1805 Lewis & Clark Expedition. as Morgan and Peace Silver Dollars. mon, but they generally do not get In 2005, a second commemorative the respect in the current market to Coins such as common-date Gem nickel for the Lewis & Clark Expedition Mint State-65 Morgan Dollars and reflect their absolute rarity. Instead, will go into circulation. The 2006 collectors seem to be focused on the Choice Mint State-63 $20.00 St nickel is intended to have Jefferson on Gaudens have largely missed out on one or two scarcest issues of each the obverse and Monticello on the re- series.