Coins weathering storm
By Mark Ferguson
coin market has been and remains to a degree one
of the brightest areas of the current economy,
which is experiencing great difficulty.
The most active area of the coin and bullion
market is the precious metals segment. Heavy
demand for the bullion coins has created a
two-tier price level for precious metals.
For example, at this writing the spot price of
silver on the exchanges is a little below $10
per ounce. However, if a customer wants to
purchase American Eagle silver coins for their
bullion content, the cost can be expected to be
about double the spot price or more. If a buyer
gets lucky by buying from an uninformed dealer,
or buying from other private individuals who
want to sell, a lower premium may be possible.
The price differential shows the impact of the
extraordinary demand for bullion coins. On the
other hand, precious metals exchange prices may
be artificially low, because many of the largest
players in the bullion market have been under
duress to sell, forcing exchange prices to
On the grander stage, central banks of various
countries buy and sell gold in huge quantities,
which very often impacts the price one way or
The market has definitely slowed for collector
coins, but a safe assumption could be made that
much of the capital collectors have available to
purchase numismatic coins has gone into
purchasing precious metals instead. Also,
collectors have obviously been hit with the same
higher living expenses as most Americans are
experiencing – higher food and gasoline prices
in addition to other higher living expenses.
So while dealers are having a slow time selling
collector coins and many other buyers are
temporarily out of the market, this is a great
time to negotiate more favorable prices on the
numismatic coins one wants to purchase. But keep
in mind that this won't work for every purchase.
Numerous well-heeled collectors are still in the
market and will jump at the chance to buy
particular coins they have been seeking.
Many collectors have spent years hunting
difficult-to-find pieces. When such become
available, often dealers have multiple collector
clients ready to buy.