> 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...