It’s a rainy Monday morning here in Portland and the sudden lack of sunshine is leaving me highly unmotivated. To try and shake out the cobwebs, I’m going to touch on a few miscellaneous topics of interest. If I were a syndicated folksy newspaper columnist, I’d call this Monday Mornin’ Market Musings. Lucky for you, I’m not. Sales of the Wexford Collection of Dahlonega Coinage have been excellent with close to $500,000 placed within the first few weeks of being posted on my website. I have noted a few definite trends thus far.
I have been surprised (but not shocked) by the extreme popularity of the key dates in this collection. One of things that was especially nifty about the Wexford coins was that nearly all the key Dahlonega issues were present and, for the most part, they were extremely nice. I could have sold half a dozen examples of the 1861-D gold dollar in PCGS AU55 and probably even more examples of the 1838-D half eagle in PCGS EF45.
While many of the coins were bought by existing clients, I did sell coins to at least two brand new people including one who had never bought a Dahlonega piece.
Two other observations can be gleaned from the first few weeks of sales. The first is that the Dahlonega quarter eagle series is clearly alive and well. I sold a number of expensive, key issues to serious collectors. The second is that gold dollars are a little weaker than I would have expected. I did sell the three most expensive gold dollars in the set but other examples, including a few that I felt would sell quickly, have not yet found new homes.
One last thing. In my rush to get the coins cataloged and imaged and out on the web for a few days before I took them to the ANA show, I didn’t have time to fully research them. It turns out that the 1840-D quarter eagle is the ex: James Stack coin while the 1856-D quarter eagle was formerly in the Bass collection. The new owners of each coin were quickly able to deduce this and I congratulate them on these terrific new additions to their collections.
I’ve been asked by a number of collectors how I think CAC is affecting the coin market. I can’t really speak for areas like Indian Cents or Buffalo Nickels but I think CAC is having a very strong affect on selected areas of the United States gold coin market.
In my experience, CAC is extremely tough on generic issues, especially common date Saint Gaudens double eagles. I have heard of dealers sending groups of 25 or 50 common date Saints in MS65 to CAC and having as few as two or three stickered. Because of this fact, MS65 and better Saints with CAC stickers are currently trading for significant premiums.
Another area that is definitely being affected by CAC is early gold. CDN Bids for early gold are continuing to go up but these bids are posted by John Albanese and are reflective of only CAC quality coins.
What this has done to the early gold market is to make it, effectively, two-tiered. As an example, John’s current bid for an 1812 half eagle in MS62 is $15,000. My guess is that a really nice, CAC-quality MS62 is pretty easy to sell for $15,000-16,000 on a wholesale level and might be worth as much as $17,500-18,500 on a retail level. But a nasty, overgraded MS62 example of the same date is not going to be of interest to John (or any other quality-oriented CAC dealer) at $15,000; it is more likely a coin with a wholesale value of $13,000-14,000. What the challenge for buyers of coins of coins like this is to determine which 1812 half eagle in MS62 is ultimately worth $13,000 and which one is worth $16,000+.
Speaking of early gold, I’ve had a few people ask me lately if they feel that prices on this material are going to continue to rise in the coming year. My answer to this is “yes but with an asterisk.”
As I mentioned above, the early gold market is becoming much more selective; partially on account of CAC. If coins like the aforementioned 1812 half eagle in MS62 are going to continue to bring these strong new price levels (remember, this is an issue that was trading for $8,000-9,000 just three years ago) they have to be very solid for the grade. By this, I don’t mean that every 1812 half eagle in an MS62 has to be an upgrade candidate. But for me (or John Albanese or whoever else) to pay $15,000 for one, it has to have good luster, a lack of significant wear or rub, nice color and a reasonably pleasing overall appearance.
I believe that there are certain areas of the early gold market that have become very pricey. For me to pay $35,000 for a 1799 eagle in MS61, it has got to be a nice coin that I feel is really “new.” If it is recolored, obviously worn, full of unsightly hairlines or covered with goop, I’m out at the current price levels. Same goes with Heraldic Eagle and Capped Bust Left half eagles in AU55 to MS64. If they aren’t really solid, original coins then I have a hard time liking them at current levels.
Conversely, there are other areas of the early gold market that I still like. As you no doubt know, I am a big fan of nearly all early quarter eagles, especially the Draped Bust series of 1821-1827 and the “mini-Fat Heads” of 1829-1834. And despite very strong price advances in recent years, I still feel that the half eagles of 1813-1834 form one of the most interesting and exciting series of United States coins for collectors with large budgets.
Most importantly, the demand for early gold remains strong. In addition to many avid collectors, there are a few coin funds that love early gold and they are continuing to buy it as long as the coins are “all there.”