As much as coin dealers–myself included–try to compare the coin market to the art market, the more you look at coins, the more you realize how insignificant this market (currently) is when compared to art. Will the coin market ever “catch up” to the art market and is it fair to make any coin vs. art comparisons? I’d like to share my thoughts on this with you.

If you look at art from an outsider’s perspective, the prices that great objects bring seem baffling. $50 million dollar Warhols? $100 million Giacometti sculptures? And what seems all the more baffling are that prices like this are for items that not everybody agrees is a masterpiece.

But examine the art market with a little bit more perspective and the prices that make coin dealers exclaim that MS64 Indian Head half eagles at $3,500 are a smoking value seem less relevant.

The market for seven, eight and even nine figure art objects is extensive and it is world-wide. If a Vermeer painting was discovered and authenticated, there would be a deep pool of buyers waiting to purchase it; even if the final price realized at auction was in excess of $200 million. Compare this to a famous rare coin like a 1913 Nickel or an 1804 Dollar. Sure, these are famous and desirable coins and an example of either would bring $5 to $10 million in the right market conditions. But the number of buyers who would be competing for these classic rarities is probably less than ten; maybe even as few as five.

The lack of depth in the coin market is even more apparent in thinly traded areas like Territorial gold or Patterns. A coin can be extremely rare and there might only be three examples known. But if there are only two strong buyers for that issue and both already have the coin, the thinness of the market is detrimental. This tends not to be the case in the art market which is deeper and which has institutional buyers as well.

There are hundreds of art museums in the Western world and a small but significant number of these have the money available at most times to buy great art that fits into their collection. Sadly, the Mint Museum in Charlotte has no budget (or desire) to purchase a great Charlotte quarter eagle if it becomes available. The Getty Museum, on the other hand, has been a major buyer of antiquities and photography for years and has helped to push values upwards in those areas.

The art world does a wonderful job of cultivating new buyers. In addition to museums there are active art scenes in cities like New York, London, Berlin and Los Angeles that have beautiful, high-end galleries where collectors (or potential collectors) can go to learn about new art, view exhibits and socialize with other collectors. The number of high-end coin stores in the United States is next to none, and I somehow can’t imagine hedge-fund directors in New York or trust-fund kids in London spending Saturday mornings chatting with the proprietor of the local coin shop.

While I personally love rare coins and I do think the market has come a long way in the past decade or two, it still has a long, long way to go as far as self-promotion goes. Art shows are much more upscale than coin shows, and gallery exhibits introduce new works to collectors or reinforce the greatness of existing masters. When’s the last time you went to your local museum to see a coin exhibit?

The rare coin market has become increasingly internet-driven and I think that’s a great thing; I know that it has certainly helped my business immeasurably. But the personal interaction between dealers and collectors in the art world remains more sophisticated and “better” than in the coin world and I think the art world is healthier for this.

Another thing to remember about the art market is that it is far more international and cosmopolitan the the coin market. When a great French Impressionist painting is offered at auction, it is possible that the winning bidder might be American, British, French, German, Swiss, Russian, or even Chinese. When a great Liberty Head half eagle is made available, the chances remain very strong that it is going to sell to an American buyer.

Buying art serves an important social function that doesn’t yet (and may never) apply to coins. When a billionaire Russian oligarch wants to makes a splash in the West, he does three things: buys an English Premier League soccer team, purchases a great apartment in New York, and makes a splash at the season’s Christie’s and Sotheby’s Contemporary and Modern Art sale.

Coins are not on the radar of many big money buyers because they are too small to display and you can’t impress your friends by laying out a PCGS box full of Gem rare date Saints.

But I think that the transportability and compactness of coins may ultimately appeal to big money buyers. Its a lot easier to move your coins from New York to London to Dubai than it is your art collection. As the world becomes a more complex, dangerous place the ability to quickly transport significant amounts of personal wealth gains in importance.

Would the rare coin market have a sudden transformation if coins, as a category, were suddenly included in Sotheby’s and Christie’s roster of sales? Probably not. There are not enough expensive coins around to keep these two firms interested in maintaining departments and both firms don’t appear to want to fool with art objects that are worth much less than $25,000-50,000 and up. And even when Sotheby’s and Christie’s had coin departments, their sales were primarily attended by American dealers.

If anyone is going to take the coin market to an international audience, it’s Heritage and I would assume that selling coins to Chinese industrialists is on their radar. And let’s not forget that both PCGS and NGC have overseas offices and are focusing considerable time, energy and marketing dollars on appealing to foreign collectors and dealers.

For the United States coin market to become more like the art market, I think a few things need to happen. Some of these are possible, some are already happening, and others seem more like a pipe-dream.

1. There needs to be more and better high-quality general numismatic reference books. We are in a golden age of numismatic research but most of the books published appeal to a narrow range of specialists. We need more books like “The 100 Greatest U.S. Coins.” A superb quality coffee table book on United States gold coins, for example, would be a great way to get more high net worth individuals interested in coins.

2. There needs to be a few upscale coin stores in New York. Manhattan remains the financial and social capital of the world and it is filled with superb art galleries. But there is no place a hedge fund manager can go and look at great coins for sale in comfort and privacy. Heritage has launched a New York office and Stack’s-Bowers will become more retail friendly (I assume), but there is still a huge void in New York.

3. The Smithsonian collection needs to reopen and there need to be touring exhibits of great American coins at locations more accessible than coin shows. There are hundreds of places in the United States to view great American art. There are only a handful of institutional collections available to view in this country.

4. There needs to be at least one or two upmarket coin shows in New York every year. Captains of Industry aren’t going to fly to Rosemont or Long Beach to go to shows. I doubt if an Armory-style show for coins would work but I’d be curious to see what happened if a coin dealer were allowed to exhibit at a fancy east coast art and antiques show.

5. The coin market needs to think with a long-term perspective. Dealers need to be thinking about the market in 2021 and 2031, not just in 2011. Coin doctoring is bad for the long-term health of the rare coin market just like scandals in the art market can hurt that industry in the long run. In a good market, coin dealers are too busy to promote numismatics and in a down market, they are too poor. There are times I wish there was a Benevolent Dictator in the coin business who told us dealers what to do and how to do it.

6. The professional side of the coin business desperately needs an infusion of fresh young faces. The art market has the advantage of hundreds–if not thousands–of smart, enthusiastic Art History majors who enter the market each year from college. The coin market has a lot of the same faces who have been around for two, three, and even four decades.

That said, I still like the future of the rare coin market. I think there is real value in selected areas of American numismatics. The relative affordability of Classic American Rarities is a compelling factor for wealthy collectors used to seeing average quality artwork priced in the millions of dollars. And the fact that the $5 Indian in MS64 that I mentioned above is within the price range of most upper middle-class Americans means that coins have the potential for much more widespread appeal than great (or even good) art.

What are your thoughts about the coin market versus the art market? Leave your comments about this below.

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10 Responses to Why the Rare Coin Market Isn’t the Art Market

  1. Martin Kaplan says:

    Doug, one of your most important articles. The only thing I might add is to broaden your perspective to “world” numismatics. There is a global market for ancient coins, world (non U.S.) coins and banknotes. Each country’s numismatic “heritage” offers collectibles for the citizens of that country and collectors all over the world. The Standard Catalog of World Coins lists countries from A to Z and U.S. coins make up but a tiny section. Again, great article! M.K.

  2. Doug, Another great article. You make some excellent points about how we need to start thinking long-range to build the coin industry. I hope it will happen. Personally, I advocate high-end, New York shows for the reasons you suggest. Getting the Smithsonian to display is also a great idea. What would it take? I know the Heritage and NGC have done a lot of work to restore the collections lately. The ANA has been showing signs of long-range planning as well. I think we’re on the right track but so much still needs to be done…


  3. Richard Spring says:

    Having spent nearly 30 years on the marketing side of the coin business I have these comments.

    First, there are too many “bad” people in the coin business. Show me a precious metals dealers who also sells coins, and I’ll show you someone offering a mediocre product at a price well beyond value. Same goes for any “coin company” that’s actually nothing more than a boiler room: who in their right mind would spend big money, doing business with a company they know nothing about and working with an unlicensed sales guy over the phone? Sadly, people do it. And it’s a continuing black eye on the industry.

    Same goes for the big financial publishers who tout really bad coin deals to their subscribers. They need to be far more diligent in who they do business with: selling $50 Buffaloes at two or three times melt isn’t going to win the coin industry any awards from the Better Business Bureau and these publishers need to stop allowing this abuse to continue. ‘

    Next, I can’t see a sophisticated investor enjoying himself at a typical coin show — where the ambience (if you want to call it that…) hasn’t changed in 50 years: rows of card tables adorned with cheap display cases; no literature of any value describing what’s on the table or why it’s priced the way it is; and some shabbily-dressed, overweight slob, who has near-zero tolerance for “the public,” staring back at you with disdain — doesn’t exactly engender confidence or bonhomie. Then he can go get a convention-center hot dog to wash down his experience.

    Even coin auctions have no class: you see a bare room in a convention hall with the same pot-bellied, ill-dressed dealers scattered around a near-empty room while most of the bidding has already taken place via the Internet or via phone bidders. Not exactly a festive occasion.

    In fact it’s pretty amazing how vibrant the coin market is, given these unattractive dynamics that drive it. Says a lot for the underlying appeal of numismatics.

    What’s needed is a professional, industry-wide approach to marketing: why can’t there be a dress code at a coin show? Why can’t there be certain standards for booths? Why can’t a billion-dollar company like Heritage — with everything to gain — dress up its auctions and figure out ways to make them “events” rather than chores? Where are the seminars like Christie’s/Sotheby’s deliver to art buyers? Where’s an hor’s douvres at a pre-sale reception? Where are the personalities to drive the coin market?

    In summary, right now there is no comparison between the coin market and the art market. On the other hand, if the coin market ever figures out how to be attractive to the high net worth individuals who populate the art market — well I think today’s prices (given the rarity and history and relative attractiveness of the right coins) are a fraction of potential value.

  4. dale friend says:

    Doug, both you and Richard have described the problem with expensive high end rarities attracting wealthy collectors. I also have attended art and antiquity auctions, with preview cocktail parties, artists in attendance , and very knowledgeable auctioneers telling fabulous stories about the items on sale.

    Marketing is the answer, perhaps some very exclusive settings, with lavish food and drink. The sale would still be open to phone and internet bidders, but the minimum coin value could start at 50,000, and be limited to 100 lots.

    The annual CAA(cowboy artists of america) in scottsdale is a good example– Artists present original oils, never before revealed to the world. A very memorable event

  5. Gary Goodman says:

    Always an intersting topic. I’d like to point out a few other areas where collecting and owning rare coins really can’t compair to art. Certainly its easy for anyone to enjoy the beauty and artistic qualities of a painting or sculputure. You don’t need to know anything about the work or the topic other than it hits you emotionly. Anyone can enjoy a “pretty picture” or “some werid pop art”, you might not like it but certainly a piece can stimulate a conversation. Not as easy for everyone to appreciate the historic “beauty” of a MS45 $50 slug that you have to pass around to look at. I think in many aspects rare coins are a more intellectual collectable, dealing with history, economics, minting techniques, sculpture and rarity. Knowing these aspects of a coin is part of the enjoyment. I doubt that most “lay” people would appreciate the difference between an 1893 and a 1893-s $1.
    Can’t hang a coin on the wall and have all your guests appreciate it without a lecture and passing around a magnifying glass. (believe me I’ve tried it !). Most people can look at art with interest but few want to hear about the dicovery of gold in California in 1848 and the need for local coins in the economy. Can’t overlook the status of having lots of art hanging on your walls. Different than having a safe full of $3 gold
    Coins are in everyones pocket, not an esoteric commodity. Not so with a painting, every original work is unique and easily distigusihable from another. Not so with coins. Sure a PF67 DC Liberty $20 is beautiful but not unique and most won’t distinguish between an 1883 and a 1904. Even these very desirable beautiful coins have many almost identical siblings, again knowing the details of dates, design and minting records are required to appreciate the differences. Lithographs may be more comparable to coins. Clearly, lithographs made by even Picasso are more of a commodity than a “great work of art”. They may sell for tens of thousands dollars but are in a different class than an original painting.
    I would also like to comment on another topic raised by Richard spring, about the conduct of coins shows and stores. My first show was in 1959 when I was 11. They haven’t changed much. Dealers are rarely welcoming to strangers (I wore a suit once and boy was I treated differently) and the venues are real messes, dumpy hotels, not easy to look at anything. Lighting is poor and coins arrranged haphazardly. Sure it will be more expensive for dealers but thye may find out it will be worth it. I find coin shops even worse. Overgraded and overpriced coins and dealers always actining like they’re just trying to get as many bucks out of you as possible. I stopped in at Stacks in New york a few years ago when I was on a business trip. What a trip! Here I expected some class. Boy, how depressing, it was dirty, dusty, no organization and rude help. Nothing interesting on display (don’t art galleries have their best works displayed and showcased) couldn’t even get somone to help me. A real negative experience. I currently only buy coins via heritage auctions on-line. As others have commented you will not get affluent people to purchase coins from people that don’t have respect and apprecitation for their wares as well as their buyers, Half the enjoyment is the search and the purchase. I think this is an area that could really change the coin market. Conduct live auctions with only 100-500 lots, the cream (like the art market, they don’t have auctions with 3000 items!). Put the rest in internet only auctions. Agree with making the live events much classer. The rare stamp market seems to be evolving this way.

  6. Scott Tilson says:

    Doug-Thanks for another great article. I think there are some superior structural advantages to the market for coins over art that should not be overlooked. Primarily, the transparency of rarity through the census reports, the unmatched liquidity, razor thin buy/sell margins (compared to other collectibles, not securities), third party grading, excellent online auction services that bests anything in the art world (thanks Heritage!) and as you mention, the portability. Coins also possess tremendous historical significance, particularly in a society that most definitely revolves around money.

    I agree with others here that rare coin “events”, both shows and auctions, are in need of great improvement. The “glamour factor” for those in attendance is a rock bottom zero. Expensive coins should not be auctioned off at 10:45 at night with 17 half awake dealers in attendance, joking among themselves, forcing anyone else there to immediately ask themselves,”What Am I Doing Here?” It’s not inviting, it’s not fun, and it’s not confidence inspiring. Unfortunately depressing i the most accurate adjective I can attach here.

    As mentioned by others, rare coin exhibits need to be more commonplace. Why not use the extreme portability to everyone’s advantage and have a beautiful multi-million dollar historical exhibit of our nation’s money tour the Morgan Stanley or Fidelity offices in cities across the country along with a catered lunch? I’m certain such an exhibit would play well in cities across America.

    I think it would be a mistake for all of us to too soon forget that wonderful day at Sothebys in 2002. The auction room was beautiful, filled with attractive staff dressed to the nines assisting guests and pouring wine, the 1933 Saint being sold was in its own beautiful case that revolved, the lights were bright, the catalog was world class and the television cameras were rolling. EVERYONE felt great and lucky to just be in attendance. Those there to bid enjoyed premium status. and suddenly price was secondary and the chance to “win” was paramount.

    In the end, everyone involved in coins “won” that day. We need more days like that!

    The coin market has come so far in the past 20 years. I think the improvements and advantages that have been created are far more difficult than the the things remaining left to do.

    Bottom line: there’s never been a better time to be a collector. Thanks to the U.S. Mint’s modern coin program (starting with the State Quarters) there are more collectors than ever before. With the value of the U.S. dollar plummeting there is a renewed focus on tangible assets among financial professionals. Most importantly, multi millionaires and billionaires are being created at a record pace. These folks need to put their money somewhere. Great Coins ARE stupidly cheap compared to Great Art.

    I guess for all these reasons you can include me as super bullish on the future of the rare coin market.

    Oh yeah, one last thing… intellectually stimulating, thoughtful articles like you continue to turn out are rarer than the coins they discuss…we need more of them too…keep up the good work!

  7. [...] excellent article from Doug Winter on why the rare coin market isn’t the art market and what needs to happen to change [...]

  8. [...] excellent article from Doug Winter on why the rare coin market isn’t the art market and what needs to happen to change [...]

  9. R G Sullivan says:

    Women, they love art, going to museums, art dealers, art sales, showing art in their homes. Women are missing from coin collecting.

    Earlier this year my wife and I were driving by the Westchester County (NY) Center in White Plains. It was the weekend of the annual coin show. We were stopped at a light for the crosswalk between the parking lot and the center.

    25+ people crossed in front of us and they were all white men between 50-75.
    Now, she jokes about some men she sees as being “coin show guys.”


  10. painting says:


    [...]Why the Rare Coin Market Isn’t the Art Market » Buy Rare Gold Coins » Douglas Winter Numismatics[...]…

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