Rare slabs can carry big premiums!

By Steve Roach
First published in the December 6, 2010, issue of Coin World

Some collectors wouldn't agree with the statement, "buy the coin, not the slab," because to them, the slab is just as important as the coin.

In particular, some collectors have acquired a taste for Numismatic Guaranty Corp. "black" holders.

NGC was formed in 1987 and these holders were used for the first several months of operation, roughly from September through November 1987.

They are similar in shape to today’s NGC slabs, but differ in that the insert securing the coin is black, and the white insert with the coin’s identifying information is on the side that displays the reverse, where the coin seems upside down.

The obverse in black holders is displayed on the side with the NGC stamped logo, which for current holders is on the back of the slab.

Few of these holders remain today. Estimates on the number of surviving black holders range from 35 to 200, and they are collected as novel relics of the early days of third-party coin grading.

Occasionally they turn up and trade at auction.

At a Nov. 14 eBay auction, a New Jersey seller offered a 1924 Saint-Gaudens gold $20 double eagle in an NGC Mint State 62 "black" slab.  (Pictured, image courtesy of Danielle's, on eBay as onionsavenged)

It sold for an astonishing $3,805. In comparison, one major dealer is selling current-holder NGC MS-62 double eagles for $1,600 and MS-66 coins for $2,850.

While grading was perhaps more conservative back in the early days of NGC, and the seller said the coin "looks like a MS64," the huge premium must be attributed more to the holder than to the coin.

Nine bidders competed for the coin, with the underbidder dropping out at $3,755. The seller set the starting bid at $2,750 – a price nearly comparable to a current holder NGC MS-66 piece.

While the black holders were flattering to brilliant silver coins or lustrous Mint State gold coins, the holders did little to flatter dark coins and copper, and the holder was retired at the end of 1987.

There is even a 420-page book on slabs by Michael Schmidt, Third Party Grading/Certification Services, that covers more than 80 companies that produced slabs and 200 varieties of normal production slabs.

Higher premiums don't seem to hinder demand for silver American Eagles

By Steve Roach
First published in the December 6, 2010, issue of Coin World

While bullion markets continue their wild fluctuations, demand for American Eagle 1-ounce silver bullion coins remains vibrant.

In October, the United States Mint increased the premium charged to its authorized purchasers for American Eagle silver bullion coins from $1.50 to $2 per coin. The premium was increased in 2009 from $1.40 to $1.50 per coin and in 2008 from $1.25 to $1.40 per coin.

While Proof American Eagle silver coins may be purchased directly from the Mint, the Mint sells the silver bullion coins only to dealers in minimum 25,000-coin shipments.

However, the premium increase seems to have had no noticeable impact on demand, as the Mint has sold more than 30 million silver American Eagles thus far in 2010, eclipsing 2009's sales record of 28,766,500 pieces.

Surely silver hitting 30-year highs including a flirtation with $29 earlier in November has helped keep demand for the attractive and easily portable silver American Eagles robust. Demand for the coins throughout the holiday gift-giving season will mean that 2010 sales figures will continue to climb.

Proof 2010-W American Eagle silver coins went on sale Nov. 19, priced at $45.95, with a 100-coin household limit.

The Mint's Web site already warns customers of possible ordering delays on Nov. 19, due to the deluge of customers who are likely to order in light of "unusually high demand."

Until Proof 2010-W coins enter the marketplace, wholesalers are paying up to $57 for earlier Proof American Eagle silver coins in original Mint packaging.

Grading service population reports show that 2010 American Eagle silver bullion coins are extremely well-produced.

Of the 44,160 graded by Professional Coin Grading Service so far this year, a whopping 36,470 pieces have received Mint State 70 grades.

Currently PCGS MS-70 2010 silver American Eagles are selling in online auctions for $60 to $100, while certified MS-69 representatives can be found for around $35 and uncertified examples are seen at $30.

In large quantities, 2010 American Eagle silver bullion coins are available from wholesale dealers at silver spot price plus $2.60 per coin.

Strong bourse + auctions at Baltimore coin show; Rarities keep soaring

By Steve Roach
First published in the November 29, 2010, issue of Coin World

The Nov. 4 to 7 Whitman Coin and Collectibles Baltimore Expo was characterized by both a strong bourse floor and well-performing auctions with interesting and fresh material.

The Baltimore show, held three times a year, has become one of the most robust on the circuit, with dealers and collectors alike praising Whitman for being responsive and Baltimore for being a good convention city, characterized by inexpensive flights, reasonably priced hotels and good local restaurants.

A walk around the bourse floor on Friday revealed healthy dealer-to-collector business being done.

Prior to the show's start, Stack's presented its 75th anniversary auction, which realized nearly $4.6 million across 2,500 lots.

It was anchored by the W.L. Carson Collection of U.S. Proof sets, a remarkable and large fresh-to-market collection put together decades ago consisting of more than 500 lots of Proof coins from 1837 to 1964.

The quality was characteristic of many old collections put together prior to third-party grading: some coins were amazing high-grade beauties while others were harshly cleaned or displayed artificial toning and were in Professional Coin Grading Service "Genuine" holders. The market absorbed the collection at strong prices.

Bowers and Merena Auctions hosted the official expo auction with more than 3,500 lots, anchored by the No. 2 collection of Standing Liberty quarter dollars with full head designation.

A toned 1916 Standing Liberty quarter dollar graded Mint State 67+ full head sold for $195,500 (pictured left, image courtesy of bowersandmerena.com), while a more brilliant example in the same grade without the "+" brought $115,000. A 1927-S quarter dollar graded MS-65+ full head brought $149,500. All three were graded by PCGS and carried Certified Acceptance Corp. stickers.

In total the auction saw 12 separate Standing Liberty quarter dollars realize more than $25,000 each.

The sum of the auction results shows continued health for a wide range of issues including gold, especially at the $20,000 to $200,000 level, as collectors continue to seek objects of lasting and proven value during times of economic uncertainty.

Market reports provide sense, auction results provide proof

By Steve Roach
First published in the November 22, 2010 issue of Coin World

After a major show, there is little shortage of collectors and dealers who post market reports. These can be useful for providing a general sense of the market at a given show, while a look at the auction results provides tangible proof of where the market is at a given moment.

Coinfest was held Oct. 28 to 30 in Stamford, Conn. It's a relatively new show and promoted a bourse of 150 dealers in 2010.

This year the show suffered a loss and a gain.

It lost free evaluations by Certified Acceptance Corp., which places stickers on certified coins if they meet a certain standard of quality. The service had been a popular draw at the show.

The show gained a Heritage auction that realized a healthy $9.42 million.

Viewing post-show reports online provides good indicators of the traffic at a show, which at Coinfest was almost universally described as slow, and the voices online offer plenty of suggestions why.

The winning reason seems to be that the Whitman Coin & Collectibles Baltimore Expo was the next weekend, and collectors and dealers alike decided to wait for that show. For many New York City-area collectors, a trip to Stamford takes the same effort as a trip to Baltimore.

A Heritage Auctions post-auction press release characterized results as 20 percent higher than pre-auction projections.

The obvious auction star was an 1879 Washlady dollar pattern in silver graded Proof 66+ by Numismatic Guaranty Corp. that was purchased by New Jersey dealer Legend Numismatics for $161,000. (Pictured left, image courtesy HeritageAuctions.com)

An exceedingly rare Colonial coin, a 1785 Connecticut copper of the African Head design graded Very Fine 30, realized a robust $115,000.

Just several nights later at Sotheby's Impressionist and Modern auction in New York, a Modigliani canvas of a sensual nude sold for a record $68.9 million, showing that at the very top of a similar market, lots of money is available to spend big to acquire the best.

However, the rapid advances in bullion prices have not seemed to bring the action in the lower-segments of the coin market for which many dealers have hoped.

Prices reflect not only a coin's grade...quality matters, too

By Steve Roach

First published in the November 15, 2010, issue of Coin World

New and experienced collectors alike are often confused when they see two coins in the same grade selling for very different prices at auction.

Dealers are quick to say that the coins that sell for more are nice for the grade, while those that don't sell for the high end of expectations are at the low end of the grade.

But when it comes to the higher end of the market, the answer can be both supply alongside the merits of the coin itself.

For example, someone may have gotten a bargain at Scotsman Auction Co.'s Oct. 15 auction where a 1794 Flowing Hair silver dollar graded Very Fine 30 by Professional Coin Grading Service sold for $109,250, at the low end of its pre-auction estimate.  (Coin pictured left, image courtesy    Scotsman Auctions, www.scoins.com.)

While the price is a bit more than the $92,000 that a Fine 15 example of the coin brought in August at Stack's, it is substantially less than the $126,500 that a VF-25 example brought at an August Heritage auction. Back in January 2009, Heritage sold another example graded VF-30 by PCGS for $143,750.

The issue is rare, but with approximately 130 examples known, it is not impossible to find. Plus there is a built-in audience for the first silver dollar struck by the federal Mint that can be tapped in promotions outside the general coin-collecting base.

1794 Flowing Hair dollars have been in the news a lot this year. A Mint State 64 example sold for $1.2 million at an August Bowers and Merena auction. In May, a nonprofit foundation purchased a PCGS Specimen 66 1794 Flowing Hair dollar for a reported $7.85 million, making it the world's most expensive coin.

Yet, the Scotsman auction transaction at below recent comparable transactions reflects the increasing selectivity characterizing today's market, especially at the mid- to high end.

A known rarity certified by a leading third-party service selling at a public auction must be accounted for when considering the value of other 1794 Flowing Hair silver dollars, but all who are in the market for top rarities, either buyers or sellers, have to take into account the quality of the coin and the overall look of it, alongside the technical grade.