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jwither

Evaluating collector and "investor" demand outside of South Africa

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jwither

In this topic, I am going to answer the unasked question from“Scarce Coin Watch”.How do I know the demand for expensive ZAR outside of South Africa is as I stated? This even though I cannot tell anyone here exactly how many buyers, who they are, where they live, what they actually buy or how much they spend.

 

The summary answer is I infer it from collector behavior indirectly through the census data, auction records, looking at dealer inventory online and in eBay, attendance at coin shows plus my personal experience selling on eBay. The conclusion from this evidence is that outside of expatriates, there isn’t any reason to believe anyone else will buy the more expensive coins other than in isolation or by pure random chance.

 

Many of the points I make below, anyone can confirm,though in typical fashion, my experience here is that any evidence I provide no matter how irrefutable will be ignored when it contradicts the lopsided preference for higher prices. For illustrative purposes only, I will primarily use the recently sold 1894 MS-63 ½ pond as an example. Where I believe this example does not apply, I will specifically say it.

 

Lastly before I get into my comments, they aren’t limited to ZAR or South African coins. It applies to most with a few exceptions and a few differences. This should be obvious but I state it anyway to counter accusations that I am “negative”. It is reality though contrary to what most of you undoubtedly want to believe.

 

First, it is a fact outside the United States,South Africa and maybe Canada, collectors disproportionately do not likeTPG. This assertion is not in dispute and anyone can confirm it by looking at the census records, non-US auctions (including eBay) and dealer inventory. DNW sells ZAR and Union graded but only since they target buyers in your country.

 

Second, since collectors outside of the countriesI listed don’t care for TPG, they aren’t going to pay the premiums for higher graded coins which all of you consider normal. There is no disputing this statement either.

 

I don’t believe there is any evidence whatsoever that others are going to pay $12,750 for it just because it is somewhat scarce. Unlike all of you, they don’t care that it is graded MS-63. They aren’t impressed it is one of 10 MS in the NGC census or that it is a “conditional rarity”. Even US collectors don’t pay ZAR or Union level premiums for US coins in MS-63. They also evaluate the actual quality of the coin instead of just assuming the one with a higher number on the label is “better” which is exactly what the historical comments on this forum indicate South African collectors usually do. I have collected South African coins since 1998 and in the past had a larger “investment” in them than probably 95% in your country. I still don’t think an MS grade is a big deal and won’t pay substantial premiums for the label on the holder either. So why would any collector do it except one of you?

 

My speculation is a few thousand elsewhere own one or more ZAR in the census but this is disproportionately concentrated in the United States in lower priced issues just as it is with coins from elsewhere. Few of these buyers collect the series and even fewer (if any) are “serious” collectors in the sense they spend what I do. Because if this were not true, how was it that I was able to buy so many coins so cheaply? They just own one or a handful they happen to like or bought on a whim such as the 1892 penny since this is what many collectors do generally.

 

I further suspect that of the coins in the census, most of the circulated ZAR and lower priced MS were submitted and are currently owned by collectors in your country. Disproportionately,US collectors won’t bother grading these lower priced coins except to sell it to one of you.Though US collectors have a preference for TPG, going by the survival estimates I have seen for US coins, it isn’t unusual at all for most lower lower priced coins to remain ungraded because collectors would rather spend their money on coins instead of plastic and grading fees.

 

The higher priced ZAR I believe many proportionately were originally located elsewhere as I have stated in the past. These I believe were submitted mostly by Americans but almost exclusively for sale and mostly to one of you. Some obviously are still owned but as with myself (mostly Union), not bought at anywhere near the prices they fetch in South Africa.

Edited by jwither

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Part 2

 

Third, Geejay speculated in his post that maybe the buyer acquired this coin for resale. There is no reason to believe this claim either, though I cannot disprove it. Whoever bought it might have done so to “flip it” to someone they know or as a speculation. However, it should be self-evident that dealers outside of South Africa do not have many (if any) customers for ZAR, whether with this profile or otherwise.

 

If you have looked consistently on websites, you won’t see the more expensive coins in their inventory with any regularity. You hardly ever see moderately priced ZAR except on eBay. Disproportionately, the ZAR I have seen is low priced average circulated issues and the same is true at the coin shows I have attended. The only dealer I know who used to consistently carry ZAR for “serious” collectors but with a rather limited selection of the more expensive coins was Northeast Numismatics (NEN). I don’t bother checking them regularly anymore but they don’t seem to carry what they did and almost certainly because most of their buyers are from South Africa, not the United States or elsewhere. As I write this post, they have nothing that any top ZAR collector in South Africa will remotely want to buy.

Now of course, Heritage and DNW carry a decent selection of ZAR but these coins aren’t necessarily sold to non-South Africa collectors. Since most of the DNW coins are graded, I believe the lopsided percentage are bought by one of you unless the coin sells cheap which is irrelevant to the claims made by those who disagree with me. The same generally applies to Heritage, both excluding expatriates as I conceded in my introduction. I also infer it from the numerous instances I see one of these coins later offered on BoB.

Yet another reason to reject foreigners are a big factor is because if they were, the price decline since late 2011 or early 2012 should not have happened. If foreigners really liked these coins so much, why did this happen? US collectors alone can easily support the prior price level even with minimal buying, yet they did not. The obvious reason is that both prior and any current buying is disproportionately financially irrelevant. The increase in the census certainly doesn’t explain it either because the supply represented by the counts is still much lower than the most widely collected coins from the largest numismatic markets.

Fourth, Collectors generally favor coins from their country of residence or origin. Many collect coins from elsewhere but it isn’t remotely the norm where they will prioritize others to pay the same or more for them in any meaningful number. Do South African collectors show any noticeable preference for coins from elsewhere? Do they buy coins worth as much as this 1894 ½ pond from the US or Australia? We all know the answer is “no” because they disproportionately do not want them, cannot buy them locally and there is no market for at least 99% of these coins in your country. So why would any of you believe it applies anywhere else to ZAR except for expatriates or by pure random chance?

Fifth, ZAR is one of the most expensive series in the world and far more expensive for non-South African collectors than their own coins. Predominantly, only US, Australia and segments in Russia and maybe China are more expensive in roughly equivalent quality. The 1894 MS-63 ½ pond at $12,750 is more expensive than 99.99% of all non-South African coins. It is possible more Americans than I believe collect ZAR because it is cheaper than US coinage and collectors here disproportionately buy most of the expensive graded “world” coins, but it still has to be a very low number or else more dealers would carry it. But even if they do, the evidence proves US collectors aren’t willing to pay the same prices you do or else the obvious differences between BoB and sales elsewhere would not exist. On the other hand, Latin coinage generically is widely collected here and dealer inventory reflects it.

Edited by jwither

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Part 3

 

Sixth, this 1894 ½ pond doesn’t have anything to distinguish it to a non-South Africa collector. You may think it is special but to others, its just one of any number of coins they aren’t interested in and if they want one, they can certainly buy a more common date (like the 1892) or one in a lower grade for a fraction of this price. Outside of expatriates, if anyone collects ZAR gold as a series in higher grades it is effectively pure random chance. There may be one or a few today but its equally likely there will be none in the future.

In my prior comments, I have mentioned its possible the 1874 Burgess pond and veldpond might be owned in above average proportion by foreigners, but these coins are one year unique designs. To a collector outside of SA, these two are interesting coins while other ZAR disproportionately are not. This is why I suspect that if an above average number of foreigners buy any ZAR gold, it is likely the 1898 pond. The coin is common, it is much cheaper and it looks exactly the same as all others except these two. To a certain extent, I also believe this applies to the 1892 5/ because it is a large coin and the “pattern” pennies due to their designs.

Seven, when I was selling my ZAR and Union coins, I had almost no buyers outside of South Africa. Of course, I wasn’t selling $12,750 coins but then, if this premise is remotely correct, I should have had more buyers for my cheaper but still high quality coins because more could afford them. If anyone wants an exact percentage, I can go check my records but offhand, out of 100 to 200 eBay sales, I recall less than10 and of these, half or more were to a single buyer in Ireland who some of you might know. If this seems so hard to believe, how many of you are regularly selling ZAR (or Union) of any material value to collectors outside of South Africa who are also not expatriates? Obviously, I am sure there would have been more buyers at some price, but only at a lower or much lower one than I actually received from a South African.

I don’t believe the demand is substantial for a ZAR coin at this price level ($12,750 USD) even within South Africa. In the past, I estimated somewhere between300 to 500 buyers spend “real money” on the series. In 2014, I spent about $6000 USD on my collection. I suspect the number spending this amount or more in a year on ZAR is maybe 100 and if more still less than 200. At the price point of this 1894 ½ pond, maybe a few dozen or slightly more which includes expatriates and the pure random chance buyer such as myself. If these numbers are too low, the census counts don’t seem large enough to support a larger one without very frequent sales since the series only has about 65 coins, a low proportion buy the gold in any better grade, and I also don’t believe very many collections are close to complete except in lower grades. If I am wrong on these estimates, this only confirms my claims that you have a disproportionate number of “investors” in your country who “flip” them.

The only exception I make for these numbers are with the1874 pond and veldpond because the census counts are higher and practically all of them are worth more than other ZAR gold, regardless of grade. The census counts and price level of these two coins is why I believe its reasonable to conclude foreigners proportionately own them more, maybe a lot more

So, now I have provided my evidence. How much evidence does anyone else here have to support that the demand for expensive ZAR outside of South Africa is of any substance? What say all of you?

 

Note: Apologies in advance for any format, grammar and spelling errors. I copied and pasted this verbiage and it was all garbled.

Edited by jwither

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A survey of the most widely available and concurrently high priced coins

Pierre included Geejay’s prior comments on the price trend for the veld pond between 1998-2010. There is no doubt this is a prominent and unusual coin which is held in high esteem by collectors and maybe non-collectors in your country. However, to give you an idea of how expensive this coin actually is, I am going to provide a brief survey of all others which to my knowledge exist with at least the same value and with availability which is equal to it or greater.

 

The purpose of this survey is not to “knock” the veld pond (since it is a coin I like) but to give you an idea of how few others coins exist with any availability which concurrently sell for high prices. If I were to perform the same survey for the Burgess pond, I would use a cut-off of $50,000 USD with at least 50 survivors. This revised list would exclude most of the coins below with maybe a few others added.

 

For the veld pond, my baseline is the census records. Currently, the combined census includes 160 with most in AU or MS. Accounting for duplicates, “details” coins and any not graded, my estimate of the actual population is somewhere between 200 and 300. I don’t have access to CoinGuide SA and Heritage doesn’t have any recent sales, but I guesstimate an AU is worth $15,000 USD. For this survey, I will assume approximately 150 actually exist with a value of $15,000 or more. If someone comes back and tells me my two assumptions need adjustment, I can then adjust the results of this survey.

 

For US coins, my sources are the census and Heritage. For the few non-US coins included below, it is mintage records, my “guesstimate” of attrition, the apparent quality distribution from prior auction records and any estimates I have read in the past, such as the one by DrakeSterling for the 1852 Adelaide Type Two pound. First, here is an itemized list of those I consider confirmed:

 

Great Britain: 1839 “Una & the Lion” proof 5 sovereign.The mintage of this coin was 400 and probably at least 90% still exist. I estimate the average grade PR-62 and the last Heritage sale was approximately $150,000.

 

Australia: 1852 Adelaide pound; I consider it the most comporable coin outside of South Africa, though in the current market it is worth a lot more. Estimated survivors is 200 for the type two variety while based upon the price, the type one must be (much) scarcer.

 

United States: 1776 Continental Currency dollar (pewter); 1915 Panama Pacific Octagonal or Round $50 gold commemoratives; Augustus Humbert 1851 territorial gold $50 “slug”; 1879 proof Flowing Hair Stella; 1916-D Mercury dime; 1916 Standing Liberty Quarter; 1889-CC Morgan dollar; 1893-S Morgan dollar; 1895 proof Morgan dollar; 1995-W PR-70 American Silver Eagle; 1911-D Indian $2.5 gold; 1795 $5 gold; 1806 $5 gold; 1909-O Indian $5 gold; 1929 Indian $5 gold; 1795 $10 gold; 1797 $10 gold; 1799 $10 gold; and 1907 High Relief $20 gold Saint Gaudens. All of these coins are worth more either for their availability or in an absolute sense. The first four I consider more prominent than the veld pond but not the others.

 

The above group has a wide price range and survival rate. The first five are generally worth a lot more than most veld pond, irrespective of grade with probably a higher or slightly higher number of survivors above my $15,000 cut-off. The dime, quarter, dollars, ASE, Indian Head gold and high relief Saint Gaudens are “key” dates in hugely popular series. In absolute terms, they are all very common. The dime, quarter and1889-CC dollar are worth less in comporable grade.The 1893-S and 1895 proof, somewhat more. The four US circulation strike gold coins are all very expensive for their availability and in my opinion, among the most overpriced coins in the world. All have thousands in the census though the number worth $15,000 or more probably ranges from a few hundred on the low end to several thousand for the1907 $20. I rate the 1995-W ASE as the second most overpriced coin in the world, second only after the 2008 Mandela 90th BD 5R.

Edited by jwither

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Part 2

 

Now, I list other candidates with a supply that I either know or believe to be somewhat less than my assumptions for the veld pond but likely in the vicinity of 125-150:

 

Ancients: Possibly Syracuse Decadrams and maybe Roman gold portrait coinage of Julius or Augustus Caesar, though I’m not sure of their scacity or how many different issues exist..

 

Great Britain: Possibly one or more of the 1600’s or1700’s gold 5 Guineas.The 1826 proof 5 sovereign is also a candidate. Heritage lists the mintage between 150 and 225.

 

Russia: Maybe one or more of the 1820’s or 1830’s platinum issues, though I am dubious any survive with this availability in a high enough grade.

 

United States: 1793 ½ cent; 1796 ½ cent; 1799 cent; 1804 cent; 1856 Flying Eagle cent; 1877 cent; 1922 “no D” cent; 1796 quarter; 1901-S quarter; 1796 and 1797 half dollar; 1794 dollar; 1812 $5 gold; and 1813 $5 gold. I consider all of these confirmed.

 

As you can see, the list is rather short and as expected, concentrated to a lopsided degree in the United States.Outside of US coinage, I know of only two coins that are worth the same or more as the veld pond with equal or greater availability.

 

The veld pond is cheaper now than most of these coins in the same quality. However, the other coins are better known. The point I am making with this data is there aren’t many coins with this availability that are also worth a lot of money. Because the veld pond is different from other coins, maybe it has substantial appreciation potential but if it does, it will be driven by buyers in your country and maybe expatriates, not anyone else. It should be apparent from my list that coins in other markets exist which are as prominent to those collectors, scarcer or both yet most still sell for less or much less. I didn’t list any examples but can do so in follow-up.

 

However, even if the veld pond is destined to sell for substantially more, this doesn’t automatically translate into (much) higher prices for other high grade Union or ZAR except in isolation, unless one or both series increase across the board.

Edited by jwither

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"The foreign interest in high end SA coinage dates far back . We have had big names in the world of coinage like Louis Eliasberg, Jerome Remick, Ford, Arielle Collection, J J Pittman to name but a few who made substantial investments in our country's rich coin heritage in the past. Some of them have left their illustrious names on the third party capsules as shown."

 

To avoid cluttering "Scarce Coin Watch", I have posted these comments here. I do so to present a counterclaim to this opinion which I think is an exaggeration to say the least

 

“Mega collectors” Louis Eliasberg, John J.Ford and John Jay Pittman were first and predominantly US coin collectors but given the value and size of their collections, also “world” generalists which were bought as a supplement. As “world” generalists, they owned prominent coins from many countries. Nevertheless, there isn’t any evidence they had any preference at all for either ZAR or Union any more than they did for most others. Their collections aren’t representative of all others anyway.

The 2005 ANR (now Stacks & Bowers) sale of the Eliasberg world gold collection Lots of The Louis E. Eliasberg, Sr. Collection | Auctions | Stack's lists seven lots out of over 3600 but none "high" end. It is possible prior sales of his non-gold holdings had a much better selection but even so, wouldn't support the sentiments in the quote above anyway. I don't know what South African coins Ford's collection included, since all catalogs aren't available. I recall Pittman's with 1931 and 1934 Union proof sets, but don't know what else.

To provide a more recent example, the Millennium collection owned the 1923 Sovereign MS-66 and an AU-55 veld pond out of 1244 lots. The Lissner collection sold by Classical Numismatics Group (CNG) in 2014 included coins worth more than $10,000 (up to somewhat more than $60,000) but low both proportionately and absolutely. Compared to Eliasberg, it was a second tier collection. Out of 2000+ lots, it included one 1892 MS-62 SS 5/.

 

Remick and the Arielle collections were British Commonwealth. I don’t know anything about the Arielle collection but I know Remick acquired most if not all of his before TPG became prevelant, none of his coins were graded and he didn’t pay anything close to current prices, irrespective of any adjustments for the price level. Spinks sold Remick’s collection in November, 2006 providing price discovery for Union which is when other collectors knew their “real value”.

 

The relevant question of Commonwealth collections is this one. Given the substantially higher price level today versus when these collections were built, would these collectors or others like them buy the same coins now at current or recent prices? There is no conclusive answer on ZAR but the answer for Union should be self evident because of the Bakewell auction. It is an emphatic “no”.

 

My conclusion from reviewing this limited sample of prominent collections is that these collectors didn't have any preference for your coinage that differs from collecting generally. If there is evidence of it, where is it?

 

Note: Format differences are due to this forum's software.

Edited by jwither

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Part 2

 

I also don’t believe outside of expatriates there are any US based collectors who concurrently collect expensive high grade or MS ZAR as a series but if there are, based upon the evidence and reasoning I have already provided, it is a very low number which doesn’t remotely support this claim anyway. It is also effectively random chance.

 

Do any of you have any idea how many series exist ? Any idea at all? It is in the thousands if not over 10,000, depending upon the definition. In US coinage alone, there at least 100 and today, 196 countries as UN members and somewhat more striking coinage.

 

Now for the collector who is not from South Africa, isn’t an expatriate and doesn’t have a predisposition (such as I do) to collect ZAR or Union, what reason can anyone here possibly provide explaining why anyone else will buy these coins other than by pure random chance, especially since they are disproportionately so much more expensive than most others? If the claim is there is one, what exactly is it? And how many of you are collecting coins from elsewhere at the same price level as ZAR or Union, never mind at much higher prices?

 

Geejay is the only contributor I recall who has ever profiled other coins above a nominal value on this forum, aside from me. However, all of them except maybe German East Africa are still thematically related to South Africa either culturally (Dutch and Southern Rhodesia) or otherwise (shipwreck cob coinage). His behavior is exactly how most other collectors act. If this claim is an accurate reflection of foreign collectors, why aren’t all of you buying other non-South African coins of equivalent value?

 

The actual answer is, you aren’t buying them because you do not want them any more than others will ever want ZAR or Union. You also don’t have a reason why foreigners do or should buy them other than your personal preference for much higher prices which isn’t a reason at all. And before anyone accuses me of being “negative”, the same applies to the other coins I collect to varying degree.

 

If Eliasberg, Pittman and Ford are supposed to support this claim that foreign collectors specifically pursue South African coinage in materially greater proportion than non-South African collectors in the aggregate, the next thing someone is going to be telling me is that my collecting (jwither) is also evidence for this claim. I make this statement because I am fairly confident the value of my South African collection at one time was more than just about every single world generalist.

Edited by jwither

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"The buyers of Southern Rhodesia are certainly not confined to any country for every time I sell these coins on ebay I get buyers from USA, China, Russia and the UK.. Certainly those from Russia and China cannot be Rhodesian expatriates. They have almost NEVER been from South Africa so you are again wrong in your assumption that this is a market restricted to Africa or a few expats. I dont know or care what the origins of any buyer is. What I have seen over the years is a steady increase in number and extent of the Southern Rhodesian coins in both NGC and PCGS pop reports. "

 

Below, I provde a more detailed response to this quote from Scarce Coin Watch. not because I am always right, but to show that when I make these statements, I have good reasons for it. I don't just make them up.

 

As to why it matters, ii is more of an intellectual exercise for the collector. For anyone who cares about the financial aspect, to show that the weight of the evidence does not support the idea that foreign buying is financially meaningful, either for this series or most others This applies to all of the series preferred by the majority of members on this forum.

 

First, I (once again) cover the likely origin of the foreign buyer. It varies somewhat depending upon the series but this is my working assumption for Southern Rhodesia. Without actually knowing the buyers, the most logical assumption is that groups two (expats) and three (commonwealth) have the greatest preference for these coins. If it is actually group five (random foreigners), then this still supports my position why most of the prices are low and there is no reason to believe these buyers will pay much higher prices except by random chance.

 

First, they could be from Zimbabwe but you never mentioned it and to my knowledge, there is no organized collecting in this country, not from the remaining European population and certainly not from the majority groups. Do you claim otherwise and if so, where are the coin shops, numismatic journals, dealer associations and coin shows? Given what is obviously a very low collector base for this series, however many remain, it is minimal and financially irrelevant.

 

Second, it could be from expatriates who I presume disproportionately live in the United States, the UK, Canada, Australia and South Africa though they can live anywhere. You should have an idea by the name of your buyers if they might be one, even if they live in China or Russia. For the latter two, I agree with you they likely aren’t.

Third, there are British Commonwealth collectors. Where are they most likely to be located?The answer is the Anglo Saxon countries I listed though they can also live anywhere.

 

Fourth, it can be locals in South Africa who I can see having a cultural affinity for these coins. I have seen these coins on BoB and in dealer inventory, such as Brian Hern. Your experience indicates either there aren’t that many of them or they won’t even pay today’s mostly nominal prices. If this is true, then this series is probably even less popular than I believe.

 

Last, there are random buyers who are everywhere else. Apparently, you are claiming most or all of your buyers fall into this group except, you seem to think there is much greater significance to this buying than I do, just as you did with ZAR.

 

In the United States as I surmised in my evaluation of expensive ZAR, there are probably a few thousand collectors (out of maybe 2MM) who likely own one or more ZAR including many in the census, but disproportionately only at nominal prices. For Southern Rhodesia, maybe a few dozen own one or more graded and a few hundred buying ungraded.

Edited by jwither

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Now, I explain buyer preferences and how this applies to the above five groups

 

As to how I can know they are buyers at relatively low prices, I have already answered this question at least a dozen times. Except for what is effectively random chance, random foregn buyers are going to have a (very) weak affinity for these coins and others which are not widely collected. Also, the price level doesn’t reflect anything more because if it did, it would be much higher.This applies to ZAR and even more to Southern Rhodesia. What this means to a price forecast is that 95%+ are likely to mostly buy something else if prices increase substantially, just as I have with Union.

 

If anyone really believes this buying signifies anything out of the ordinary, then answer this question. Why would collectors who have no affinity for a coin whatsoever pay “high” prices for them other than random chance, especially if or when the coins you like sell for (a lot) more than others which the lopsided majority consider preferable?

To take one of my series, the Spanish colonial pillar minors are available in MS at less than $500 USD for the Mexico 1/2R and many others are available in AU to MS-65 from $500 to $2000. A collector can buy most Mexico pillar dollars (1732-1772) in AU-55 or AU-58 with nice color and/or a good strike in the vicinity of $1000 USD. Internationally,this series is preferred over those favored by this forum by a lopsided proportion, yet the “serious” collector base for the pillar dollar probably still only numbers in the hundreds.

Most collectors prefer coins from their home country or country of origin either over all or most others. This is also true in South Africa for ZAR and Union. For all other buying, there are two general categories as I described recently. First, there are the low number of series (like ancient Greece and Rome or pillars) which have a real international market. Second, there are all other coins which are not that popular except with locals and expatriates. In this group, there is the random chance buyer who are MOST foreigners along with a small minority who happen to have an affinity for a variety of reasons. My collecting of South Africa is an example of this affinity preference but it is also disproportionately financially irrelevant.

 

Whether you are going to admit it or not, ZAR, Union, Southern Rhodesia and VOC all fall into this third group. ZAR and Union are preferred in South Africa but not popular with more than very low number anywhere else. There is no local market in Zimbabwe just as there isn’t in Bolivia. For VOC, the explanation I provided recently is the best one I can come up with based upon the available data which indicates it is presumably most popular locally in the Netherlands but not really even there, except for crowns and gold.

 

Within this third group, there is also a wide range of popularity though the international collector base is low for all of them, except at nomimal prices. If there are 10,000 series, my guess is that ZAR falls somewhere between the top 3% and 5% in international (not local) collecting. It might be in the top 100 but if it is, only or primarily because the gap below the top 20 or maybe 50 is really narrow in terms of both the number of collectors and the “investment”. As with Union, there are multiple series in Southern Rhodesia but it is likely far lower, though I suspect KGV is somewhat higher.

 

The most logical conclusion from what I am telling you is that, regardless of where these four series fall in the preference scale, like almost all other coins, they are only widely followed in their home market (if at all) and elsewhere, mostly forgotten. Financially, external buying is also economically irrelevant. The largest impact to the price level is usually reducing the supply available to the local buyer which for ZAR and Union is all of you.

Edited by jwither
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"In the case of the 1934 6d, there are about 5 graded at NGC and of those , 3 are in MS. At PCGS, there is a single MS63 coin. That is it !! I dont see any raw gradeable coins on the horizon or anywhere else."

 

Now let me address this quote.

 

Since I joined this forum, many have repeatedly implied the census counts are complete or near it. Why any of you subscribe to this logical fallacy is beyond my comprehension. I have previously explained why the census is not representative for most coins and the only reason I can see for this opinion is to exaggerate the likely or actual scarcity, the price potential or both .In this post, I take another angle to arrive at the same conclusion.

 

First, if the census is really representative, then South African coins are either more common or a lot more common than most others. Does anyone here really believe this? Check the census counts for the UK and other European coins because most counts are lower than ZAR by a substantial margin and Union by a somewhat lower but still significant one. Or perhaps the claim is it is only representative for the coins all of you like but not most others?

 

Second, in my prior topic analyzing Southern Rhodesia (which received no replies of course), I compared the census counts to the Spanish colonial pillar coinage. Going by the available evidence, I agree some of the pillars are likely actually more available even in higher grades, despite the counter intuitiveness of this conclusion. However, “some” does not remotely mean “most” or even a substantial minority. Going by common sense, it should be obvious that this isn’t remotely likely.

 

Third, looking at the US census, someone might conclude that most 20th century issues are relatively scarce for the mintages because the counts aren’t that high. They are high by international standards but not absolutely and many are still lower than many ZAR and some Union.

 

I am not aware of a single informed US collector who shares this premise which many here apparently believe. The dynamics differ completely but the overwhelming consensus is that the current census counts are the equivalent of the visible part of an iceberg. The reason why it is the consensus is because the evidence actually supports this conclusion. As one example only, the 1962-D quarter with a recent census count of 190 in PCGS MS-66, its actual supply is potentially in the thousands if not more.This is equally true of all other lower priced 20th century US coins.

 

Now, why don’t these counts represent the actual scarcity? The answer is the same one I have provided more times than I can even remember.1) Collector preference 2) Market value 3) Registry competion or for non-US coins lack of it. 4) Ownership distribution including a substantial proportion of non-collectors.

 

To answer your other comment on the increase in the census, this in and of itself does not automatically represent an increase in popularity and this is true for any coin where the most buyers do not prefer TPG. It might but the only thing we can know from the buyer side is that it possibly represents a change in the preference from ungraded to TPG, not an increase in the collector base. It is also equally possible though that the buyers actually don’t care about TPG one way or the other but buy these coins because they are offered in the holder and they don’t want to wait for a second and likely somewhat cheaper one

 

From the seller’s standpoint, depending upon where they are located, it may also make sense to have the coin graded before they sell it. If the seller is from the US, there is certainly nothing out of the ordinary because they will do so with any coin as long as they have a reason to believe the incremental sales price will more than offset the grading fee. If the seller is located elsewhere, this can also have multiple possibilities. The first is the one you believe. The second is that the coin was already graded. Since the census counts have increased, this supports some increased preference for TPG but whether for the buyer or the seller, not necessarily an increase in popularity for the series.

Edited by jwither
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