Is there a CAC coin market bubble?

CACNUTCOLLECTOR

Some highly respected numismatic commentators have suggested that the recent run up in auction and dealer prices for relatively uncommon collector coins and relatively common but wildly (or highly unusually) toned common coins, all with CAC beans, has the hallmarks of a pandemic-induced bubble fueled by myriad of factors (e.g., extra cash from staying home, stimulus money, the psychological need to exert one’s dominance during a once-in-a-century viral pandemic that has us sidelined from society and glued to iPads, anger at the gods, etc.). 

At the same time, it is also advised that when one-of-a-kind quality coins appear in an auction or dealer’s inventory, smart collectors know when to “reach” (ie, overpay) for such coins. 

So, after years of witnessing coin market values for many categories of collector coins steadily decline (think seated liberty, think barbers), hearing that the hobby is threatened by the lack of interest in coins from our children who are consumed by video games (and never, ever, will search for wheatbacks in coin rolls…), and seeing a giant surplus of coins continue to expand with no end in sight, the question is:

Are we at the beginning of a long robust market in CAC coins, or will it be tulip mania deja vu all over again? 

Glicker

Impossible to predict in the future which asset classes will outperform the others. When folks look at coins as investments rather than a hobby, they are often disappointed. Example is the low mintage Jackie Robinson gold business strike commem. Peaked at $4800 about 15 years ago and now sells in the $800-900 range. 

Enjoy the coins. Leave the speculation to the pros.  

MarkFeld

CACNUTCOLLECTOR said:

Some highly respected numismatic commentators have suggested that the recent run up in auction and dealer prices for relatively uncommon collector coins and relatively common but wildly (or highly unusually) toned common coins, all with CAC beans, has the hallmarks of a pandemic-induced bubble fueled by myriad of factors (e.g., extra cash from staying home, stimulus money, the psychological need to exert one’s dominance during a once-in-a-century viral pandemic that has us sidelined from society and glued to iPads, anger at the gods, etc.). 

At the same time, it is also advised that when one-of-a-kind quality coins appear in an auction or dealer’s inventory, smart collectors know when to “reach” (ie, overpay) for such coins. 

So, after years of witnessing coin market values for many categories of collector coins steadily decline (think seated liberty, think barbers), hearing that the hobby is threatened by the lack of interest in coins from our children who are consumed by video games (and never, ever, will search for wheatbacks in coin rolls…), and seeing a giant surplus of coins continue to expand with no end in sight, the question is:

Are we at the beginning of a long robust market in CAC coins, or will it be tulip mania deja vu all over again? 

There are a great many non-CAC coins about which the same could be said and asked. 

CACfan

All collectibles markets run in cycles that can last months, years, or decades. But so few coins are CAC certified that it will be hard to kill the momentum. The demand may always outstrip the supply. Yet, the same cannot be said for non-CAC coins, especially extremely common modern coins. As a retailer, I have found that collectors would sell their first born before they would part with their prized rarities. I have unsuccessfully tried to buy back such coins many times, sometimes mere weeks after purchase, for far more than the buyers paid.

EarlyFederalCoinage

I don’t think it is limited to CAC coins only, but some aspects of the market improved markedly in such a small amount of time and does fit the pattern of a bubble. Time will only tell if that perception is reality.

fathom

Rare, in-demand, high quality CAC from historically significant periods in US history will insulate the best should demand fall off in numismatics IMO.

john

....and then there were comic books....

Wabbit

Yes, and I am quite happy with what I have sold a ton of them for lately!

Legend

We should be in a start to a bull run-but its so selective we are not. Sure all gold is red hot. Classic rarities are being disrupted by just a few people. 

I've been preaching for people to take some profits. You won't get hurt or lose out if it does stop. And do not kid yourself, a severe lack of coins can kill off a bull market if nothing is coming out to trade. 

Yes, CAC coins are strong-there is no bull market as the prices are the market. There is a difference in standards. That is why CAC sells for more. No bubble there. 

Stevie

I believe the gap will only increase between CAC and non CAC coins as new collectors continue to value the stickers validity of TPG services grades. Gold stickers will also increase as collectors realize their rarity 

Wabbit

Legend said:

I've been preaching for people to take some profits. You won't get hurt or lose out if it does stop. And do not kid yourself, a severe lack of coins can kill off a bull market if nothing is coming out to trade. 

I for one listened to you, blowing out a ton of my common dates acquired over the years.  (Getting 2-3 times more than what they cost me all in)  I have held on to the rare/top pop or close graded stuff so far.  

I pulled out boxes of raw Morgan's/Peace that I didn't think would grade, or were not worth sending in.  Some of these are selling for more than the graded examples would sell for.  My garbage 1921 Peace dollars sold for $300-$400.  I paid 50 bucks each 5 years ago.  1899-P Morgan's, I bought them for $40 or so, getting $300-$400 also.  All these coins are raw.  If it has a CC on it, it will sell in 5 seconds.

Of the hundreds I sold, only one came back.  (I had the wrong mint-mark)  This is a bubble for sure.  The reddit groups are helping hype these.

Winesteven

I’ve also listened to Laura for years, and my collection of eye appealing 100% PCGS/CAC has done nicely! At the same time, I see many coins that are not PCGS/CAC languishing, as the pricing differential, in general, increases!

mulberryman

Very interesting question on whether CAC coin premiums will increase, stabilize, or decrease. Like most things (oil/gasoline, coins, stocks and bonds, interest rates, etc.), prices seem to go in cycles but over time generally rise. I look at it this way, (as a non numismatic expert), that there are two basic kinds of CAC coins: common (generic) and uncommon (rare coins). I expect prices for rare CAC coins (gold in particular) will stay high. Like another member pointed out, astute collectors know when to pay more for hard to come by coins. I’m not as confident about generic coins. Common date generic condition census coins are risky in my view. With so many out there, who knows when a “hoard” will show up. So, my unscientific view is that the rare CAC coin will hold its own and probably skyrocket. Thanks. 

Stevie

I personally have built up a nice collection of 20th century type coins worth about a $1000. Which I intend never to part with unless I see a coin that is better to add. But I have had so many hours of enjoyment that if I lost half of my money it wouldn’t overly upset me. 

I think collectors should collect and appreciate coins for their history and beauty, and as an investment as a secondary consideration. This way you will never be a loser