In real estate the ultimate "consumer" of a piece
of property is someone who will use it to build a home, to situate a factory, to
cultivate for the growing of corn, or to make a parking lot. However, the fact
remains that many parcels of land have changed hands over a long period of years
without being developed. Raw land was, is, and probably always will be a
desirable commodity. In theory, all raw land will someday achieve its ultimate
value when it is used by someone, but in the meantime nice profits can be made
in anticipation of this time, even if the time is quite distant and beyond our
lifetime.
Similarly, it may be reasonable to suggest that it is
perfectly fine, and potentially quite profitable, for large numbers of investors
to buy quantities of coins, including rarities, with nothing more in mind that
holding them for future appreciation and selling them to another generation of
investors. While it might be nice, at least in a theoretical way, if at some
future time a collector were to own a particular coin, say one of those common
1881-S dollars, in the meantime it makes no difference in the market if today's
buyer is a collector, an investor, or a combination of both. I can argue both
sides of the question.
In 1989 and 1990, much money from Wall Street entered the
coin business, which many now refer to as the coin industry. Kidder, Peabody;
Merrill Lynch, and other highly respected securities firms pumped millions into
the marketplace with the expectation that a later generation of buyers, be they
investors or collectors, will come along and pay higher prices. Then came a coin
market slump, and Wall Street interest has since faded.
Frank S. Robinson's Commentary
Frank S. Robinson, a coin dealer and veteran observer of
the numismatic scene, contributed the following poignant and insightful article
(here excerpted) to Coin World concerning the extreme importance of the role of
the collector to sustain the basic foundation of numismatics:
"Collecting enjoyment is a coin's only ultimate basis
of value. The market, though, seems to suggest that coins also have some
independent investment value. It is true that investment coins have done well
while collector coin prices have stagnated due to a declining collector base.
What happened was that, even though the coin hobby boom fizzled, it had
meanwhile touched off an investment boom strong enough to outlive it (thus far).
4 of 16
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Table of Contents
Collecting Coins |
Collectors and Investors |
Have a Plan
Dealing with Dealers |
Auctions |
Value |
Grading |
Grades and Prices
Recommendations for Collecting |
Maximizing the Rewards
Design Types of U.S. Coins |
Mints and Minting
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