If you invested in coins in 1978

If you invested in coins in 1978

Post by mark » Mon, 28 Jul 2003 10:24:57



Found a 1978 Red Book at a thrift store today. What I found interesting
was the newspaper clippings and written notes the previous owner had
left in the book.

One dated 12/26/79 has written on it gold closed at 506.30

The clipping is and article about the high demand for krugerrands.

Another is a graph clipped from an article that shows how gold
skyrocketed in '79.

But my favorite is a hand-written note: Gold $609.00 oz....Gold $5000.00
oz. in 10 yrs.

I wonder how many folks purchased coins and bullion thinking what this
person apparently was, that the sky was the limit.

Collect for fun!

Mark

 
 
 

If you invested in coins in 1978

Post by Alan & Erin William » Mon, 28 Jul 2003 11:03:55


Quote:

> Found a 1978 Red Book at a thrift store today. What I found interesting
> was the newspaper clippings and written notes the previous owner had
> left in the book.

> One dated 12/26/79 has written on it gold closed at 506.30

> The clipping is and article about the high demand for krugerrands.

> Another is a graph clipped from an article that shows how gold
> skyrocketed in '79.

> But my favorite is a hand-written note: Gold $609.00 oz....Gold $5000.00
> oz. in 10 yrs.

> I wonder how many folks purchased coins and bullion thinking what this
> person apparently was, that the sky was the limit.

> Collect for fun!

> Mark

My friend's father 'got into gold' around this time.  He's got a lovely
(unintended) collection of Pandas, Rands, Leafs, all sorts of coinage
(and lots of it!).  He is wealthy enough to smile when he tells me that
he is 'a patient man' and will be parting with his collection just as
soon as gold crosses over $800/ounce.

I'd be a nervous wreck if I had sunk the sheer volume of money into that
market that this gentleman did, yet he seems stoic enough about his
position.  

Alan
'he does not go look at them often, though'

 
 
 

If you invested in coins in 1978

Post by Joe Schel » Mon, 28 Jul 2003 20:36:24



says...
Quote:
> My friend's father 'got into gold' around this time.  He's got a lovely
> (unintended) collection of Pandas, Rands, Leafs, all sorts of coinage
> (and lots of it!).  He is wealthy enough to smile when he tells me that
> he is 'a patient man' and will be parting with his collection just as
> soon as gold crosses over $800/ounce.

> I'd be a nervous wreck if I had sunk the sheer volume of money into that
> market that this gentleman did, yet he seems stoic enough about his
> position.  

> Alan
> 'he does not go look at them often, though'

Just think if he would have bought early Halfs or Large Cents or
Colonials or Barbers or....ohhhhh, the humanity!!
--
Copper is as copper does.
 
 
 

If you invested in coins in 1978

Post by High Plains Writ » Tue, 29 Jul 2003 05:52:57



Quote:
> Just think if he would have bought early Halfs or Large Cents or
> Colonials or Barbers or....ohhhhh, the humanity!!

Yes, excellent point, Joe. Investing in Coins is not the same thing as
investing in gold.  Even if the coins qua coins had been gold, if they
were numismatic items, the outcome might be somewhat different.  For
instance, gold dollars, threes, and low mintage half eagles would have
been "coins" rather than "gold."

As noted, of course, often and more often and perhaps not often
enough, collectibles are poor investments.  The fallacy I see at work
is hoping to find something that you can buy and forget about and by
some agoric magic, it will outpace inflation, the Dow, and your
wildest dreams.  Such investments are rare -- which is why they are
the stuff of hope.

Another aspect is that in order to actually "profit from coins" you
really have to be involved in the markets, to be a dealer.  You have
to turn over the investment for a profit but do so often, so that the
profits compound.  Of course, you have to avoid losses.

One of the sources of tall tales and urban legends of numismatics is
"How Much Money I Make on eBay."  Granted that this is a real market.
What I see is that collectors with monsterous inventories representing
ponderable if not burdensome sunk costs do in fact turn over some
coins at nice profits.  Focusing on those, they do not tally the
losses.  We should do it like they do in baseball where each coin you
buy is one "time at bat" and each coin you see above purchase price
adjusted for time (inflation) is a "hit."  I'd be astounded if there
were any .300 hitters in this league.

It is a hobby.  If you want to be a dealer, fine.  If you are a
dealer, great.  Most self-defined "collector/investors" are mired in
cognitive dissonance.  For instance, as above, say someone did buy
$100,000 in low-mintage high grade US Half Eagles.  How would they
evaluate today, versus, say, in 1978, buying Apple computer?  Or
putting $100,000 into an MBA or a law degree?  In the last 25 years,
you could have bought one heck of a nice house in 1978, sold it, and
bought another and then sold that.

And it is equally likely that in 1978, you could have bought stock in
companies that no longer exist.  You could have lost it in a savings
and loan.  Your dream home could have been taken by a brushfire. It is
best, perhaps, to buy what you like and enjoy it while you can.  My
father-in-law just bought himself a nearly mint 1964 1/2 Mustang
convertible (red).  He even let me drive it.

If you had invested in muscle cars in 1978...

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