During my travels of the last four years, visiting shows, antique malls, flea markets and etc., I have heard the comment, “Ebay and the internet have certainly had a strong affect on collectible prices, mostly negative.” While this is certainly true of some items, in reality the statement would qualify as roughly a “Half Truth”. Most of my collecting career I have been a “Copper Head”, collecting U.S. Large Cents and for many years a member of EAC, “Early American Coppers”. Although I expended a great deal of energy and time, there were some Large Cent dates and varieties I simply could not locate. In contrast, today it’s no longer a matter of finding something you need or are looking for, it’s do you have the money required to buy it. While this is true of many items, there are still scarce and rare pieces left to look for at coin shows and flea markets. The thrill of the hunt still exists.
Further comments concerning the affects of the internet sales: on a show last night I saw an appraisal of a rare Martin Guitar worth about $75,000! During the discussion, the appraiser said the guitar market as a whole has suffered because of internet sales, but the classics, such as the Martin, are continuing to see annual value increases and will continue to in the future.
The same can be said of coins and paper money; the truly scarce classics will perform well as they have in the past. The marginal coin dates and denominations, which were difficult to find in the past, but not necessarily rare, are the pieces most likely to be affected by internet sales. This does not mean the affected coins and paper money are not marketable, it just implies that the buyer has more places to buy from. The market sources have expanded. In the past, a collector looked for a particular coin for years, got excited when he found it, and jumped at the opportunity to finally buy it.
Obviously, there is no question that the internet effects have been very significant, both positive and negative. Some areas, such as baseball cards and pocket watches, have seen steep price declines. Many items thought to be rare before have been found to be plentiful. In contrast, coins are just coming off of a big market boom, and old paper money of practically every type has increased in value. The items may be easier to locate but the prices have remained strong.
In contrast to coins and paper money, no one knows exactly how many baseball cards of a certain type were saved in prime condition or put in bicycle spokes, and the production totals on many other items are mere estimates. However, with coins and notes there are official government totals, making rarity and scarcity an easy calculation. With a mintage of just 484,000 1909-S V.D.B. Lincoln cents it’s not feasible to speculate that a million will appear on the internet market next year and drive prices down.
As noted, there are positive as well as negative effects from internet sales, but in my opinion the positive is far out in front of the negative. For example, the internet has simplified the collecting process by providing a source for practically every coin required, for a price. In the past, collectors had to go to coin shows or shops to obtain most of their coins. In addition, some bought from coin publications, relying on a written description. Today, the internet has made it possible for collectors to see the coins before making a purchase, and with grade certification, there is a guarantee of a specified grade. Also, the internet affords the ability for collectors to “shop around” for the best price. Although there is no substitute for going to a show for the learning process of seeing as many coins and grades as possible, collectors can build a profitable collection from a home computer.
Since coin collecting may entail large sums of money, there are certain risks associated with buying coins at shops and shows. Many incidents have been reported concerning collectors being stalked by criminals and followed away from the show and robbed. Obviously, this can be avoided with online purchases. As an additional precaution, many collectors have their coin and currency purchases sent to a post office box instead of their home address. Should a dealer’s system be hacked into, the addresses of known collectors would not be revealed, only the names and box numbers. I am not attempting to take away the fun and excitement of attending shows, but one should always be aware of certain threats. Attend shows with friends and be observant. It’s a “Jungle” out there.
In light of the recent coin market peak, most collectors and dealers would agree the U.S. Mint’s aggressive marketing and advertising on the internet has been a driving force. This certainly is true with the State Quarter Program which began in 1999 and lasted through 2008. Millions of collectors were brought into the hobby by way of internet sales. In addition, sales of U.S. State Quarter maps and folders have been tremendous and hundreds of coin firms and the mint have maintained customer lists and shipped the new quarters annually as they were minted and released. Other programs, such as the Presidential Dollars, gold First Lady Series, and the Territorial Quarters have continued the process. All of this activity has been healthy for the coin and currency market, creating increased demand for all numismatic collectibles from Half Cents to Double Eagles. Many collectors who bought the quarters also purchased a “Red Book, Guide Book of United States Coins” and expanded their collections to include many other coins of interests. This activity, which began with the internet, resulted in a higher demand for the limited supply of coins and in turn, increased prices. Instead of retarding coin prices, the internet has provided a strong stimulus for continued growth.
If there is a negative effect, it is tied to the fact that we may have to pay more for rare issues, such as key dates in high grades or with extremely low mintages. In the past, when we encountered a coin with high potential it was possible to obtain a good price on the piece from a dealer having a slow day. However, with auction companies such as Ebay, the dealer may be more inclined to auction the coin or paper money issue for the highest price. If the demand is truly high and the grade is right, we will be forced to compete for the coin. As a result of feverish bidding, prices may rise to many times the listed values. According to this scenario, the internet has pushed prices higher on some special issues.
In addition to being an excellent avenue for buying and selling coins, the internet is also an excellent source for information concerning practically everything. Every time I buy a new coin, first I look it up in my edition of, Walter Breen's, “Complete Encyclopedia of U.S. and Colonial Coins”, and then I look on the computer. Rather pricey, starting at $159 for a used copy on Amazon, it is the best coin reference any collector or investor can own. Dr.Breen spent his life researching coins, among other things, and was the last word on new coin varieties pertaining to all types of U.S. and Colonial coins. Much of the information found on the internet references his research.
As detailed in this article, the internet can help a new collector begin a lifelong hobby as a source for information and for purchasing coins. Building sets of coins is much easier and quicker since the arrival of home computers and the internet. And, at the end of the spectrum, auction companies, such as Ebay, can provide a way for senior collectors and their heirs to sell coin collections when the time comes to sell. As I remember someone saying many years ago, “All collections are eventually sold.” In the past many valuable collections have been literally given away at pawn shops and flea markets by owners who didn’t have a clue about coin and currency values. In contrast, today, they can be presented to thousands of bidders and a fair price obtained. My final analysis is from the prospective of buying, pricing, selling, and obtaining information the internet has definitely been a positive force and will continue to be a major factor into the future. - William Weeks |
