RCC/Making a Market in Modern Commemorative Coins

Making a Market in Modern Commemorative Coins

If you're the type that "reads" the advertisements as often as the articles in publications such as Coin World and Numismatic News, you may have noticed a recent run up on the prices of certain modem commemoratives. It's a very unexpected occurrence, and one that may not be fueled by the typical market drivers.

Coin prices, like prices on most other items, are typically driven up when the supply is not adequate to meet collector demand. If there is one series that has had little demand recently, it would certainly have to be the modem commemoratives. But if you are to believe the prices currently being asked by several dealers, it would appear that the 1996 Atlantic Olympics uncirculated silver dollars, and the uncirculated gold half eagles commemorating the Smithsonian Institution and Jackie Robinson are the hottest coins on the market!

When was the last time you saw modern silver dollar commemoratives feature price tags over $100? How about gold half eagles at $400, $500, $600 and up?

It is true that some of these pieces have low mintages. Some of the half eagles, in fact, have uncirculated mintages of less than 10,000. But if you have a very small collector base, low mintage figures are not really an issue. The number of former modern commemorative collectors is significant; the number of current collectors is much smaller. Many have been driven away by the poor price performance of the series and the many questionable "commemorative" programs forced on collectors.

None of the recent programs ever reached their authorized mintage limits. The mintages were low because collector demand was low - a rather simple equation.

I believe what has happened, however, is that a few dealers read the low mintage numbers, decided that they could create an artificial market demand by raising prices (without collector pressure), and then sit back and profit as new collectors jumped on a misguided bandwagon. For now, it appears to be working, but I don't believe that the prices can be maintained over the long run.

I'm fortunate to have purchased all but one or two of the current "hot" coins before their price manipulations began. For the pieces I'm missing, I'll wait and see if my theory holds true. If I'm wrong, I may have to pay a little more to complete my set. If I'm correct, I'll be able to complete it at a significant saving!

Until next month, Happy Collecting!

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