Welcome to Steve's blog, sharing stories of his professional coin career, 1963 to date. Enjoy stories of Steve's numismatic journey.

Thursday, August 9, 2012

Rare Coin Worth 2x Average Salary

In 1965 I was still a newbie in the coin market, working as a partner in a San Diego coin shop, learning fast.

One day a gent walked into the shop with business on his mind.  This fellow visited the shop regularly, though I had not seen him buy much of anything.

He asked if I was planning to attend the Statler Hilton coin show in Los Angeles the following week.  I was.  We talked about how all the “big guns” in the coin market attended from all over the country.

Then he stated his business:  would I be willing to sell a coin for him at the upcoming show?  Of course I would!

1796 No Pole Half Cent
1796 No Pole Half Cent
2008 Goldberg auction

He brings out a 1796 Half Cent, an issue I had not yet seen and knew very little about.
It was a beautiful coin, likely a no problem Fine by today’s grading standards, manifesting the characteristic obverse die crack.

We discussed the price he wanted for his coin, including a small commission for my services.  We settled on an asking price of $9,200, minimum $9,000. 

As we negotiated the price, I was trying not to fall off my chair, for the guy was asking a veritable fortune for his coin!  $9,200 was about twice an average worker's yearly income in 1965.

I consulted the Red Book to discern why the collector felt his coin was worth this sky-high price, discovering the coin was a very rare 1796 No Pole variety.  Even today there are only about 30 pieces known of this issue, 3 of those in uncirculated condition.

1965 Market Perspective
Let’s examine the coin market in 1965.  As this story unfolded, the market was trying to digest a huge run up in prices and activity in the BU Roll market, soon to be followed by a resounding crash.

There were few truly rare coins coming to market, for the strong hands that held such pieces (including the Norweb and Eliasberg families) perceived the market for rarities to be significantly undervalued.  And, it ultimately turned out they were correct.

In 1965, it was a big deal to see something like a 1796 Quarter in XF for sale at a coin show, let alone a truly rare 1796 or 1797 Half or a 1794 Dollar.  Display of a real rarity created mobs around a table, as collectors and dealers vied to view an elusive specimen.  Early coinage buyers tended to be the rich and famous.

Average collectors focused on small cents, Buffalo Nickels, Mercury Dimes, Walking Liberty Halves, Morgan and Peace Dollars.  Q. David Bowers wrote an article, “Recommendations for Investing in Type Coins,” included in an October 1965 issue of “Coin Dealer Newsletter” (The Gray Sheet).   Bowers’ article did not even mention Half Cents or Large Cents. 

A Rare Coin Finds Appreciative Buyer
When I arrived at the Statler coin show, I carefully displayed the coin in my showcase.  About 30 minutes later an important and astute collector/dealer from New York arrived to take a look.

As I quoted the agreed-upon price to the potential buyer, I held my breath, afraid I would be laughed out of the room.  After a brief period of examination and negotiation, the 1796 Half Cent sold for $9,000.

This was my first experience handling a truly rare coin and it was a delight to deal with a buyer who knew the scarcity and value of what was being offered.

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