Broad demand seen for Walking Liberty half dollars

By Steve Roach - http://www.steveroachonline.com
First published in the June 16, 2011, issue of Coin World - http://www.coinworld.com/

Demand is broad for Mint State Walking Liberty half dollars and many issues have seen prices increase steadily in the last month.

As of May 25, there are at least five wholesale buyers who are aggressively buying MS-64 to MS-66 Walking Liberty half dollars in large quantities to fill orders. At the wholesale level, MS-64 examples are priced at $56, MS-65 pieces are at $131 and MS-66 coins are being sought in large quantities for $190 each.

While silver’s recent drop cooled off the overheated generic Mint State Morgan and Peace dollar market, Walking Liberty half dollars were unaffected.

The retail prices that collectors are paying for the half dollars have not yet caught up to the wholesale demand. For example, at a May 24 Heritage Internet Coin Auction with broad participation, a mostly brilliant 1947-D Walking Liberty half dollar graded MS-65 by Numismatic Guaranty Corp. realized just $126.50 over eight bids, despite several wholesale dealers offering to buy any brilliant MS-65 example for $131 (pictured left, images courtesy of Heritage Auctions).

To contrast, a toned 1940 Walking Liberty half dollar in NGC MS-65 realized just $104. As with the recent action for generic Morgan and Peace dollars, demand is reserved for coins that are untoned, or very nearly so.

For sure, the market for generic Walking Liberty half dollars is smaller than for Morgan and Peace dollars, simply because there are fewer examples. It is substantially more challenging to find 1,000 MS-65 Walking Liberty half dollars when compared to Morgan dollars in the same grade.

The market’s appetite for Walking Liberty half dollars goes up to more expensive issues. A look at recent auction results reveals that there is especially strong demand for the tough early Denver Mint issues in MS-62 through MS-64.

At the same time, buyers have become increasingly choosy with conditionally rare late-date (post-1933) issues. Wide price ranges at auction for coins of the same date, grade and grading service show that buyers are looking for more than just a grade when selecting coins for grading service’s registry sets.

At Heritage Central States Numismatic Society convention auctions in late April, just five of the 310 Walking Liberty half dollars offered failed to find bidders — each was a high-grade late-date issue. Buy-ins like these are often the result of the consignor having more enthusiasm about a coin’s value than the bidding audience

Steve Roach is a Dallas, Texas, based rare coin appraiser and fine art advisor who writes the world's most widely read rare coin market analysis each week in the pages of Coin World.  He is also a lawyer and helps create estate plans for collections. Visit him online at http://www.steveroachonline.com, join him on LinkedIn at http://www.linkedin.com/in/stevenroach or follow him on twitter @roachdotsteve

Coin market affected by silver's recent tumble

By Steve Roach - http://www.steveroachonline.com
First published in the June 6, 2011, issue of Coin World - http://www.coinworld.com/

The gold and silver markets have been in a state of flux for the past several weeks, with silver experiencing a severe correction in recent weeks.

On April 28, silver closed in London at $48.70 an ounce after reaching almost $50 an ounce during the day's trading. Just a week later on May 6, silver closed in London at $34.20 an ounce and on May 17, it hovered near $34 an ounce.

Gold has shown more stability, its price ascent also having been more gradual than silver's. When silver started to fall at the start of May, gold held its own until May 5, gradually dropping from its May 4 close of $1,541. By midday May 17, gold had declined to $1,470.

In the past several weeks, demand for generic Morgan dollars – a market sector that has shown dramatic gains in the past several months – has slowed as market makers stopped buying them in quantities. The primary demand for these coins came not from collectors, but from telemarketers, and the sharp decline in silver has made these relatively common coins a tougher sell at current levels to noncollectors who may be hesitant to invest in silver coins now.

To capitalize on the earlier dollar craze, Numismatic Guaranty Corp. had begun offering a new on-site grading tier at $30 for Morgan and Peace dollars valued at $500 and under, during major shows such as the June Whitman Baltimore Coins and Collectibles Expo.

Perhaps most sensitive to price fluctuations are Mint State 63 and MS-64 Morgan dollars. As prices increased, the grading services received an influx of Mint State examples for grading, with the majority of these coins grading from MS-60 to MS-64, meaning that the supply for MS-65 and MS-66 coins is not increasing in a meaningful way.

Proof American Eagle silver coins have also declined in price in the wholesale markets over the past two weeks. While on May 2 major buyers were paying $95 for examples with original packaging, on May 17 many of the major buyers stopped buying and the few continuing buyers were paying $73. For comparison, in mid-March these were trading at $50 each while silver was trading around the $35 an ounce level. The U.S. Mint is scheduled to release Proof 2011-W American Eagle silver coins on June 30, which will further reduce the pressure on the prices for these coins.

The recent influx of Proof 2011-W American Eagle gold coins, which first went on sale April 21, has not put much of a damper on that market, as prices had stayed reasonable and had not jumped as dramatically as the Proof silver American Eagles. At the peak on May 2 dealers were paying $1,750 an ounce for the gold issues, but on May 17 prices fell to $1,675 an ounce.

Steve Roach is a Dallas, Texas, based rare coin appraiser and fine art advisor who writes the world's most widely read rare coin market analysis each week in the pages of Coin World.  He is also a lawyer and helps create estate plans for collections. Visit him online at http://www.steveroachonline.com, join him on LinkedIn at http://www.linkedin.com/in/stevenroach or follow him on twitter @roachdotsteve

The strong market for classic Proof U.S. coins

By Steve Roach - http://www.steveroachonline.com
First published in the May 30, 2011, issue of Coin World - http://www.coinworld.com/

The Heritage Platinum Night auction on April 28 was led by gold coins, with classic U.S. Proof gold coins achieving the six highest prices in the sale. The auction was held in conjunction with the Central States Numismatic Society convention, held in Rosemont, Ill., April 27 to 30.

The second highest price was $230,000 for an 1860 Coronet $20 double eagle graded Proof 64 cameo by Numismatic Guaranty Corp. The last time it crossed the auction block was in 2004, when it was housed in a Professional Coin Grading Service Proof 63 cameo holder and realized $94,875. That coin, along with many others in the Heritage auction, were from the Slotkin Family Trust Collection, a collection of nearly 300 Proof classic U.S. coins, of which more than 90 percent were graded by NGC.

Before the auction, some questioned if the coin market could absorb this many costly, very high grade Proof coins, most with cameo and deep cameo designations, many of which had been purchased by the consignor in the past five years.

More than 100 separate coins from the Slotkin Collection sold for more than $10,000, and more than 5,500 bidders participated in the auction, showing the depth of the current coin market even at price levels beyond the pocketbook of the average collector.

Not all coins in the auction, however, brought prices that were higher than realized in the most recent previous appearance. An 1896 Barber quarter dollar, graded Proof 69H ultra cameo by NGC, realized $29,900, less than the $34,500 that the consignor purchased it for in January 2009.

On the CSNS bourse floor, dealers lamented what they saw as a lack of opportunities to buy coins to add to their inventories.

Fresh material is a problem in the current market.

One significant gold dealer wrote about the show, in a comment attached to his new purchases, that it "was characterized by an extreme lack of fresh material and it took four solid days of 'pounding the pavement' and using all of our contacts to find interesting coins for sale."

His comments were echoed by several other dealers, although the sale of a substantial multimillion dollar U.S. coin type set at the show provided some fresh material that was quickly absorbed into the market, and serves as a reminder that all coins don't necessarily pass through auctions.

Steve Roach is a Dallas, Texas, based rare coin appraiser and fine art advisor who writes the world's most widely read rare coin market analysis each week in the pages of Coin World.  He is also a lawyer and helps create estate plans for collections. Visit him online at http://www.steveroachonline.com, join him on LinkedIn at http://www.linkedin.com/in/stevenroach or follow him on twitter @roachdotsteve

Crazy precious metal markets and a robust Central States show

By Steve Roach - http://www.steveroachonline.com/
First published in the May 16 issue of Coin World - http://www.coinworld.com/

As this is being written April 27, there is lots of optimism about the Central States Numismatic Society's convention in Rosemont, Ill., from April 27 to 30.

Dealers are excited about the show being in an easy-to-get-to location, in a region with a large collector base and a major airport. With gold and silver at highs not seen in a generation, many dealers are hoping that some new buyers might be making the rounds of the bourse floor, looking for ways to diversify their investment portfolios with coins.

The CSNS show can serve as a guidepost for the market, with a major Heritage Auction Galleries Platinum Night.

In 2008, the CSNS show was held in Cincinnati, and many consider that show to represent the low point of the coin market in the last five years.

While the Heritage auction lacks a big star like the 1804 Draped Bust dollar that headlined the firm's Cincinnati auction – and realized $3,737,500 – the Rosemont auction has a broad selection of coins that will test the resilience of the market for collectible coins at nearly all levels.

The strongest test may come for hundreds of classic Proof gold and silver coins. Many of these coins were purchased at auction in the past decade, allowing for interesting price comparisons.

In other news, precious metals started off the week with a bang.
On April 25, silver traded at almost $50 an ounce and came within a dollar of its 1980 all-time high. That same day, gold for June delivery in New York hit an all-time high of $1,518.32 an ounce before retreating to $1,497.50 the next day.

After the price of silver almost hit $50 an ounce, many silver investors cashed in their profits and waited for the April 27 announcement on new federal interest rates from the U.S. Federal Reserve's two-day policy meeting.

The Fed's announcement suggested that interest rates would remain low for the near future.
On April 27 the price of gold jumped nearly $20 an ounce to an all-time high of $1,531.40 an ounce during the day's trading in New York City while silver ranged from a low of $44.86 to $48.32 an ounce during the day's trading.

As the price of gold and silver rose, the dollar hit a new 2.5 year low. The U.S. Dollar Index, which measures the strength of the dollar against other major currencies, has dropped 10 percent in the last 12 months.

Rising gold, silver prices set to lift up Central States coin show and auction

By Steve Roach - http://www.steveroachonline.com
First published in the May 16, 2011, issue of Coin World - http://www.coinworld.com/

As this is being written April 27, there is lots of optimism about the Central States Numismatic Society's convention in Rosemont, Ill., from April 27 to 30.

Dealers are excited about the show being in an easy-to-get-to location, in a region with a large collector base and a major airport. With gold and silver at highs not seen in a generation, many dealers are hoping that some new buyers might be making the rounds of the bourse floor, looking for ways to diversify their investment portfolios with coins.

The CSNS show can serve as a guidepost for the market, with a major Heritage Auction Galleries Platinum Night.

In 2008, the CSNS show was held in Cincinnati, and many consider that show to represent the low point of the coin market in the last five years.

While the Heritage auction lacks a big star like the 1804 Draped Bust dollar that headlined the firm's Cincinnati auction – and realized $3,737,500 – the Rosemont auction has a broad selection of coins that will test the resilience of the market for collectible coins at nearly all levels.

The strongest test may come for hundreds of classic Proof gold and silver coins. Many of these coins were purchased at auction in the past decade, allowing for interesting price comparisons.

In other news, precious metals started off the week with a bang.

On April 25, silver traded at almost $50 an ounce and came within a dollar of its 1980 all-time high. That same day, gold for June delivery in New York hit an all-time high of $1,518.32 an ounce before retreating to $1,497.50 the next day.

After the price of silver almost hit $50 an ounce, many silver investors cashed in their profits and waited for the April 27 announcement on new federal interest rates from the U.S. Federal Reserve's two-day policy meeting.

The Fed's announcement suggested that interest rates would remain low for the near future.

On April 27 the price of gold jumped nearly $20 an ounce to an all-time high of $1,531.40 an ounce during the day's trading in New York City while silver ranged from a low of $44.86 to $48.32 an ounce during the day's trading.

As the price of gold and silver rose, the dollar hit a new 2.5 year low. The U.S. Dollar Index, which measures the strength of the dollar against other major currencies, has dropped 10 percent in the last 12 months.

Steve Roach is a Dallas, Texas, based rare coin appraiser and fine art advisor who writes the world's most widely read rare coin market analysis each week in the pages of Coin World.  He is also a lawyer and helps create estate plans for collections. Visit him online at http://www.steveroachonline.com, join him on LinkedIn at http://www.linkedin.com/in/stevenroach or follow him on twitter @roachdotsteve