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 Friday, December 07, 2007
Take advantage of freebies
Posted by Dave
Free and the Internet seem to go hand in hand. Users expect things to cost nothing. It is not so with print publications, but there are still freebies there, too, and hobbyists should consider taking advantage of them. Numismatic News offers all of its subscribers a free classified ad each week. Regular users get more value from the classifieds than they pay for the subscription. Show organizers get a minimum of three free listings for their shows in the weekly Show Directory plus appearances in the twice yearly Show and Auction Guide if they get the notices of shows to us far enough in advance. That makes five free listings. All that is required basically is that the organizers ask. Numismatic News includes a free show listing form in every issue. If snail mail isn’t the show organizer's cup of tea, he or she has the option of e-mailing the information to Lisa Dombrowski at lisa.dombrowski@fwpubs.com. They can even telephone (800) 573-0333 if they want to add paid listings to the free ones for just $10 a week. I know that budgets are tight. Take advantage of these two freebies and stretch your hobby dollars. Does this read like an advertisement? Well, I plead guilty. I am proud of the paper and its free services and I hope readers will take advantage of these free opportunities to enrich their hobby experiences.
12/7/2007 8:55:42 AM (Eastern Standard Time, UTC-05:00)
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 Thursday, December 06, 2007
2008 might just be a good year
Posted by Dave
What does the future hold for us in 2008? Everybody would like to know. Many opinions are expressed, especially in the financial news media. I am not in a position to take advantage of sophisticated economic models. I have to rely on what I can see and what I have experienced. From that perspective, there is good news. Coin dealers and others active in numismatics have expressed their views in the most concrete way possible: with their cash. I just deadlined the January 2008 issue of World Coin News. Display ad revenue decisively exceeded the target in our annual budget. The issue will be distributed at the Florida United Numismatists convention and the New York International Numismatic Convention in January. This result does not mean the financial prognosticators who are pessimistic about next year are wrong, but it does cast some doubt. By both outlook and habit I am an optimist. I would love to be in the position of those hobbyists who live in the euro economies. Coins here seem incredibly cheap and euro-based buyers are aggressively in acquisition mode. I saw a comment by World Coin News writer Bob Reis that his business was now higher abroad than domestically. That, he noted, had never happened before. Every business person knows that profit is where you find it and you have to adjust behavior accordingly to maximize outcomes in ever changing conditions. Conditions most assuredly are changing. But that isn’t necessarily a negative. It just means things are different. I like different. Hobby life would be boring if nothing ever changed. There I go again, being the optimist.
12/6/2007 8:58:36 AM (Eastern Standard Time, UTC-05:00)
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 Wednesday, December 05, 2007
Kisses from the Mint?
Posted by Dave
Every Halloween I get a lesson in what is called line extension. I get to see what new forms familiar candies take. The Mint is practicing line extension. The question is will coin buyers bite. If I have a big Hershey bar, little Kisses or bags of the little bars, it is all chocolate to me. It tastes great. What about dollar coins? The Mint has a slew of new ways to buy dollar coins. A new set that went on sale Monday offers a West Point uncirculated silver American Eagle, four uncirculated Presidential dollar coins from Philadelphia and an uncirculated Sacagawea dollar from Denver. The price is $31.95. You might call it a dollar coin type set. Then there are four-coin Presidential uncirculated sets for $8.95 from either Philadelphia or Denver. There is an eight-coin uncirculated set that includes the issues of both mints. Its price is $15.95. Individual Presidential proofs are offered for $5.95 each. Is there a market for these offerings? Are there people who don’t want a full proof set who decide that they really would like just a proof Madison dollar? It is certainly possible, but I have my doubts of it being an economically viable product line extension. We have had packaging errors in the past when there were just proof sets and mint sets to keep track of. With all of these line extensions, the possibilities for packaging mishaps explode geometrically. Already Ken Potter in recent years has noted that quality control for proof sets just isn’t what it used to be. The evidence comes in the many reports to him of proof coins with errors from minor die cracks to spiked heads. Then there is the secondary market. For sure the many packaging options will drive price guide publishers crazy.
12/5/2007 9:08:16 AM (Eastern Standard Time, UTC-05:00)
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 Tuesday, December 04, 2007
What's next for First Spouse program?
Posted by Dave
The Dolley Madison First Spouse gold coin is not yet sold out more than two weeks after it went on sale Nov. 19. This situation was not unexpected. The price hike for this, the fourth coin in the series, upset many potential buyers. The expense of routinely buying expensive gold coins is beginning to hit home with collectors who are facing the costs of building a set of approximately 40 designs and 80 coins (if we assume they want both proof and uncirculated versions). And the instant profit available to any buyer who acquires what can be popular on eBay is missing. Of the three factors, the eBay factor is probably the most critical for this set. Once this factor disappears, can it ever return? That raises other questions in my mind that I would ask all collectors. Have you written off the idea of ever collecting a complete set of First Spouse gold coins? Have you written off the possibility of ever buying even one First Spouse coin? If you happen to have purchased any of the first three, will you continue to keep them, or will you sell them while the price of gold is high and move on to other areas? I would like to know the answers. I think the Mint would like to know, too.
12/4/2007 9:03:53 AM (Eastern Standard Time, UTC-05:00)
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 Monday, December 03, 2007
I wasn't looking for a coin read
Posted by Dave
It is difficult to come back to work after having time off. Sure, with the Internet, I was not as out of touch as in those golden days of yesterday, but nevertheless, I got a good mental and physical rest. Gold took a header while I was away. The stock market roared and clawed back a few of the losses from earlier in the month of November. I happened to read a book called, The Panic of 1907: Lessons Learned from the Market’s Perfect Storm. It was written by Robert F. Bruner and Sean D. Carr. I recommend it. I saw it in the airport and knew I had to read it. One of the marks of good publishing is to have a book on the rack that seems relevant to the headlines. For me, this was it. I have been watching the holdings in my retirement accounts drop dramatically, rise dramatically and then repeat. It reminds me of the shampoo bottle instructions: “Lather, rinse and repeat.” I am not fond of the wide swings, but current market conditions made me a ripe target for the book seller. It is a relatively brief book. It was not an economics manual at least insofar as the history was concerned. The economics got a little deeper in the lessons section at the end. This book should be read by coin collectors and paper money collectors because it sets the historical stage for the Federal Reserve Act of 1913. A lot of collectors wonder why the Federal Reserve was created. This will tell you. We are living currently with the subprime mortgage mess. Politicians are taking positions. People are being hurt. Wall Street has gotten panicky. Well, cast your mind back 100 years and you can see the same psychology at work. If you read the book, let me know what you think.
12/3/2007 9:03:53 AM (Eastern Standard Time, UTC-05:00)
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 Friday, November 30, 2007
Not known for its name
Posted by dave
CONECA is a hobby organization that should be more often in the public eye and have more members. I think this every time I publish a story about a newly reported error coin. Inevitably I receive e-mails and letters asking about errors following the stories. I know this topical area is popular and these contacts just prove it. However, to be able to properly identify errors and to collect them intelligently takes some education. CONECA, which stands for Combined Organizations of Numismatic Error Collectors of America, is an organization that can help in this process if hobbyists would take a few minutes to join. Dues are $25 and I am sure that figure will stop most would-be joiners. It is a shame, because the learning process is not free. You either pay upfront with dues, or somewhere down the line a mistake with a purchase might cost you more than the annual dues ever would. Yeah, I know it sounds like I am getting on my high horse, but editors are allowed that occasionally in the name of furthering the hobby educational process. Visit www.CONECAonline.org. See what you think. The time to act is now rather than when you find that funny looking coin that might be worth 25 cents or $250. Becoming able to tell the difference is worth the effort. This is a good place to start.
11/30/2007 9:02:25 AM (Eastern Standard Time, UTC-05:00)
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 Thursday, November 29, 2007
Time to face the music
Posted by dave
I have received my invitation to speak at the Sarasota Coin Club meeting held in conjunction with the Florida United Numismatists Convention in January. This will be my third year in a row, so what I have to say must be of some interest to the members. I enjoy attending. It is nice to see a meeting of a successful club that I otherwise wouldn’t be able to visit and to hear what its members have to say. This past January I gave a talk with 10 forecasts for this year. I have just one more month to go before I have to tote up my successes and failures. One of the glaring failures so far has been my gold forecast. Back at the opening of 2007, I figured whatever gold did it would close right round $600, not all that far from where it opened the 12-month period. Better not quit my day job, as the saying goes. I thought I had good reasons, but apparently the market thinks otherwise. I suppose I can console myself for the next 30 days by saying it ain’t over ’til it’s over. But I am ready to face the music. What better place than the FUN convention to make a clean breast of things and look forward to 2008? What better group than Sarasota club members to share it with? Then there’s the truly hard part. I have to come up with 10 more forecasts. Perhaps I should leave gold alone.
11/29/2007 9:04:55 AM (Eastern Standard Time, UTC-05:00)
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 Wednesday, November 28, 2007
Gold a good target for rumors
Posted by dave
Everybody knows that the U.S. government is a big holder of gold bullion. It used to be said that the 260 million troy ounces that it has represents one-quarter of all the gold that was ever mined. Since there has been a lot of gold mined since I first read that statement, the proportion is probably lower, but that is still one heck of a lot of gold. Such a hoard attracts commentary from various and sundry sources. Every so often there is a rumor that the gold in Fort Knox is not really there. Back in the 1970s the rumor was so intense that there was actually a news conference to show off the stacks of 400-ounce gold bars. Numismatic News published the news and the photos. Nowadays, the rumors take new twists. The government might still own the gold, it is said, but it has been leased out to the market to try to depress the price of the metal. Well, if that is the case, they are doing a mighty poor job of depressing the price. That rumor is right up there with the war in Iraq was about the United States getting the oil. If we were acquiring oil, we sure did a poor job of it as any visit to a gas station will tell you. But that is the nature of rumors. In addition to rumors, there are conclusions based on snippets of information that don’t really apply. Some e-mails I have received recently in response to our online poll question basically say that if the government owns so much gold that it acquired for $35 an ounce or less, then gold coins from the Mint shouldn’t be so expensive. After all, the government gets a profit, doesn’t it? Well, the Mint doesn’t raid Fort Knox for its gold. It must buy it on the open market like everyone else. The one limitation is that legislation authorizing American Eagles specified that the gold the Mint buys must be mined within the country. I don’t expect the rumors and opinions about U.S. government gold to disappear. If they did, that wouldn’t be any fun at all, now would it?
11/28/2007 9:00:36 AM (Eastern Standard Time, UTC-05:00)
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 Tuesday, November 27, 2007
Keep that skeptic in you sharp
Posted by dave
Wall Street calls them “pump and dump” schemes. What do coin collectors call them? When you see someone online saying this or that coin will hit a certain price by a certain time, there is a possibility that the person making the forecast is not just being helpful. The writer might own what he is touting and hopes to make a quick profit on it. If a group of Lincoln cent collectors were comparing notes online as to where they expect the price of XF 1909-S VDB coins to go over the coming year, that would be one thing. The presumption here is that they share a common interest, they are knowledgeable buyers and that all or a significant number of them already own the coin. What if a writer posting an online opinion just happens to own a significant number of whatever it is he is touting? Always ask yourself whether the opinion expressed online is a candid observation, or whether the person could own a large supply of the specific coin being mentioned. He would naturally like to unload them at a profit. You are the potential buyer who can help him reach his goal. This time of year people tend to evaluate how their investments did in the prior year. Stocks look pretty saggy. Now is a good time to tend to your healthy skepticism so that you are inoculated against pie-in-the-sky coin purchases. It is one thing to buy something for a collection. It is also fine to take a flier now and then as long as you know what you are doing. But beware the hot tip if it is in an area you cannot independently verify. Somebody might just want to dump the ready supply on you.
11/27/2007 9:04:39 AM (Eastern Standard Time, UTC-05:00)
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 Monday, November 26, 2007
Is Mint lucky or good?
Posted by dave
Back safe and sound from your holiday weekend? Good. I wasn’t expecting to be in the office, so this was prepared ahead of time. The day before Thanksgiving, I checked www.coinflation.com to see what the current metallic values were for cents and nickels. Prices have been tumbling with the stock market. Because copper and nickel are industrial metals, demand is primarily from users who grow or contract with the overall economy. With the stock market going into panic mode reasonably regularly since late July, it probably should be no surprise that metals are making their way lower regardless of what gold is doing. Copper has fallen below $3 a pound to $2.9386, taking the value of the old 95 percent copper cent to approximately 1.95 cents each. Nickel has declined to $13.3802 a pound. The five-cent coin is now worth 6.1 cents in copper and nickel metal. We have come a long way down since spring when I was writing that the coin was worth nearly 10 cents. The real shocker for me and anyone who doesn’t follow the market daily is the price of zinc. It is less than $1 a pound at .9943. The copper-coated zinc cent that has been made since 1982 is now worth .57477 cents each. The Mint might actually be able to make a profit again at that level. Certainly there is no threat of melting for this particular coin. If metal prices keep declining we will have to ask ourselves: was the Mint lucky or good when it did not rapidly move to change the alloys when the price increases first threatened the viability of the cent and nickel coins. What do you think?
11/26/2007 9:02:48 AM (Eastern Standard Time, UTC-05:00)
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 Wednesday, November 21, 2007
Not yet gone to grandma's?
Posted by Dave
If you are reading this on the day it was written, you haven’t gone over the river and through the woods to grandmother’s house yet for a nice juicy turkey dinner. It is hard sometimes to keep focused on the coin hobby when family obligations beckon, but let’s try. First up, I need to point out a math error in my Monday blog. I slapped my forehead yesterday when I noticed it. It involved the prices of the Dolley Madison First Spouse gold coins. Everybody now knows they went up in price and many consider the increase a substantial one. I wrote that the increase was 19.14 percent on average. I should have written 23.67 percent. For some reason, I divided the difference between the higher and lower prices by the new higher number rather than the lower figure from which the comparison was being made. The outcome does not alter any of the points I was trying to make, but it is an indication that I was sloppy Monday morning. Second up, I see that the “W” uncirculated silver American Eagle coin has gone off sale from the Mint Web site. That is likely due to a depletion in the supply rather than the cost of silver bullion. As of this week’s Mint Statistics, the Mint had sold 558,810 of the coins. That figure is not as high as the 746,421 proofs sold so far, but it is a substantial number and few can complain that they didn’t have adequate chance to buy one. Other items will be going off sale in the coming weeks as supplies run out. These are primarily bullion-related coins. The Mint’s bullion distributors are usually given the chance to take a last crack at inventory before the year closes. The weekly increase in gold and silver American Eagles and Buffalo gold totals seems to indicate that the pipeline is being filled. The holidays are a popular time for bullion coins given as gifts. We will see if the higher prices lessen the demand this year or increase it. I might have messed up the math Monday morning, but there is one figure that I know is correct. I already know how many pieces of pumpkin pie I want to eat tomorrow. Have a happy and safe Thanksgiving. The next post will be on Monday morning.
11/21/2007 9:01:12 AM (Eastern Standard Time, UTC-05:00)
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 Tuesday, November 20, 2007
White House event honors Dolley Madison
Posted by Dave
The first thing I did after I signed in on my computer was go to the U.S. Mint Web site to see if the First Spouse gold coins for Dolley Madison were still being offered for sale. I had my answer as soon as the Mint’s home page came into view. There was no immediate sellout as was the case for the first three First Spouse coins. The Mint was actually advertising the Dolley Madison offering with images and a news crawl moving underneath to call attention to yesterday’s ceremony at the White House with First Lady Laura Bush. Mint Director Ed Moy was present as was a Dolley Madison re-enactor, who was also involved in a ceremony last year. She must be good at portraying Dolley Madison. The fourth First Lady of the United States saved the Gilbert Stuart portrait of George Washington from destruction when she took it just ahead of the advancing British army that burned the White House, the Capitol and other buildings in the city in 1814. The burning of the White House was a low point for the American republic, but Dolley’s reputation was made by her plucky behavior. It did not hurt that the nation’s honor and situtation were retrieved by a peace treaty signed just a few months later that basically said, “Never mind.” The country did not have to pay the price of the significant defeat that led to the loss of the capital city and Andrew Jackson’s victory in the Battle of New Orleans after the treaty was signed made it seem like the United States had won the war. How plucky will collectors be with Dolley Madison’s coins? As I wrote yesterday, prices are up. If historical reputation means anything, Dolley Madison’s coins deserve a sellout, but I know it doesn’t work that way.
11/20/2007 8:59:09 AM (Eastern Standard Time, UTC-05:00)
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