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Life of a legend Protea series

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jwither
4 hours ago, Cold Sea said:

I think we are, marketing, of which TPG is just one of the tools. But there is little or no current marketing for the Griqua note which I used as an example. This is a true collectors item, and I think the price it sold for is a reflection of the collector's market rather than the speculator's market you are talking about. Even if the note was TPG graded, I believe, it still would not have made much difference in the price it sold for.

From your prior post, I understand it sold outside of South Africa.  If true, that probably has a lot to do with it.  It doesn't make any sense to me but I have never seen a reason for it offered here.

As another example, Heritage sold what I understand to be the best example of the Kroon (the Mitchell coin sold by DNW in 2014) a few weeks ago.  One bidder $60,000 USD with buyer's fee.  Even in the current weak market, seems hard to believe it sold for this price.  It's easily one of the most desirable coins in the entire South African series.

If this is near the real current price, it should be evident that most other prominent coins are worth a lot less. 

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testrarossa
On 6/30/2019 at 6:03 PM, Pierre_Henri said:

They have all gone down the drain - the SAA, SAPO, SAP, TRANSNET, ESKOM, e.g., --- and now the SA MInt is probably following  this same horrible downward spiral.

Yes that’s why today Rand vs Dollar exchange rate is R15.3 to $1. 

 

 

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Cold Sea
On 8/25/2019 at 4:44 AM, jwither said:

Measured by the price level, I believe both markets (SA and US) are in trouble and the reason for it is exactly as I stated, it's predominantly a marketing gimmick from start to finish

I believe that non-marketing is a major contributor to why the "historical" numismatic market seems to be flat. Think what you will, but the Mint is doing their marketing bit and getting the results, whether we like it or not. Local numismatic societies (other than Natal) are either non-responsive or maybe they only exist in name. My view is that until such time as an active National Numismatic Society is established, focusing on both collectors and speculators alike, the hobby will always be struggling to increase in numbers. I bet that most paticipants on this forum have the same frustration and would support such a society.

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jwither
5 hours ago, Cold Sea said:

I believe that non-marketing is a major contributor to why the "historical" numismatic market seems to be flat. Think what you will, but the Mint is doing their marketing bit and getting the results, whether we like it or not. Local numismatic societies (other than Natal) are either non-responsive or maybe they only exist in name. My view is that until such time as an active National Numismatic Society is established, focusing on both collectors and speculators alike, the hobby will always be struggling to increase in numbers. I bet that most paticipants on this forum have the same frustration and would support such a society.

From what I can tell of the prior posting history on this forum, the primary reason most prior participants (before this place turned into a dead zone) would have supported a national society (such as the ANA in the USA) is to inflate the price level, not because they care about collecting as a hobby.  I never read any reason to believe such a sentiment.  To my knowledge, the ANA in the USA doesn't engage in financial promotion, as it has nothing to do with collecting. (Neither do any of the other coins clubs I know.)   For the short time I was a member, I never saw any effort to do so, at all.  That's probably one of the main reasons the ANA membership has been flat or near it for a long time.  (The other reason being the internet.)

I also disagree with you that this would make any noticeable long term difference to the price level whatsoever.  The reason I disagree is because it's artificial and not organic.  As I have stated many times, ultimately only real collectors derive any utility from collecting, not the far too numerous "investors" who represent an outsized proportion (versus other countries) in the USA and South Africa both.

Financial promotion, whether by a national mint or the industry, isn't going to turn (rent seeking) profit oriented participants into real collectors.  I understand that few to none will make an outlay without the expectation of at least mostly getting their money back at resale but that's where the problem begins due to the TPG collecting model as I stated in my prior post right here.  The prices of the higher grade more expensive coinage are usually (totally) disproportionate to the merits as a collectible.

Ultimately, the buyer either likes what they bought enough as a collectible or they don't, independent of making money off of it.  If most don't as is evident for most buyers of the more expensive South African coinage, the trend since 2011 is what you get.  It should be evident that prices cannot perpetually increase where it exceeds the financial capacity or willingness of hobbyists to pay.

What I would like to know is, given the attitudes I have read from the posts here, why would you or anyone else believe that what you describe will make any difference at all, except by inflating another temporary price bubble?

I see genuine interest in ZAR (now at much lower but more rational price levels) but little to none for most Union and RSA coinage.  The latter two represent about 95% of all South African coins.  The prices indicate little interest except in the higher grades and on very infrequent occasions (such as the 1931 6D on BoB now), the scarcest coinage.  The posts here indicate that most buyers don't seem to prioritize completion either.  To me, it appears that most who spend any noticeable sums are buying a low(er) number of higher grade coins at random based upon what is available due to financial reasons.  

For myself, I never started out collecting with the intent of making money.  I did so (by accident) with South African coinage but probably won't (in "real" money) with my current collection which I estimate at $60,000 to $70,000 or more than about 95% of all collectors in your country.  I attempt to get value for my money from a collecting aspect but if profit were my primary motive, I wouldn't be a collector.  I would place my money elsewhere. 

For myself, the key is buying coins I like enough where I won't mind a loss.  I expect the coins I buy now (pillars) to lose value in the financial crash I foresee but buy it anyway because most of what I own might not be available for a long time.  If I decide to collect South Africa again, I expect the coins to be both cheaper and more available.

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Cold Sea

You said it yourself, you attempt to get value for your money, but your primary reason is to collect and you don't mind a loss. Now most, if not all start-up collectors expect coin collecting to be profitable. But isn't that just the thing about coins. I collect other stuff as well, but strangely enough, when we discuss and I sometimes show my friends, they automatically attach more value to coins that the other collectables. And I don't think that this is true only for RSA and the US as you seem to suggest. 

I see the function of a Collectable's Society not one to create a market, but to assist existing and new collectors to that market through research, articles and preserving the institutional knowledge of seasoned collectors. To turn your words, "organic, not artificial". There are many past and present publications on our coinage, but books alone will not be catalyst enough. I have seen many questions being asked by newcomers on this forum that went unanswered, when I know that there are more knowledgable participants reading it, but opt not to answer.

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jwither
11 hours ago, Cold Sea said:

TPG You said it yourself, you attempt to get value for your money, but your primary reason is to collect and you don't mind a loss. Now most, if not all start-up collectors expect coin collecting to be profitable. But isn't that just the thing about coins. I collect other stuff as well, but strangely enough, when we discuss and I sometimes show my friends, they automatically attach more value to coins that the other collectables. And I don't think that this is true only for RSA and the US as you seem to suggest. 

I don't believe it is just start up collectors in South Africa who believe in profiting off of coins, not if this forum was any indication though I have no idea how long any participant has been a buyer.  If your claim is true in your country, there is a lot more reason to believe from this forum that these people mostly abandon it after they lose money consistently and see that it isn't profitable.

The only reason I can see why these new "collectors" thought and think as you claim is first, because of the prior bubble.  And second, because that's what they have read, heard and been told.  Certainly not because there is or ever was a reason to believe it.

As for your comparison to other collectibles, it depends upon items you are talking about.  Most other mass produced collectibles (that's what coins are) either have been proven or almost certainly will be proven to be a "flash in the pan" whose appeal will quickly fade.  I presume anyone can find this stuff on BoB, it's on eBay and Heritage deals in quite a few.  Some are also subject to the same marketing gimmick (TPG) as coins.

What I describe isn't unique to South Africa but it's far more evident in any market dominated by TPG than all others.  This is obvious from both the price level and the price structure; the price variances between different TPG grades.  The coins in markets where TPG grading isn't a noticeable factor aren't priced as those where it is because collecting (yes, mostly real collecting) in these countries hasn't been financialized.

Going by the TPG data, the only markets where TPG predominates are the United States, South Africa, China and maybe Canada.  In the latter, I suspect (but cannot prove) that it's mostly actually US based collectors driving the TPG preference.  It's also generically evident with NCLT (mostly bullion "coins") but that's because most of these buyers are either Americans or most of the rest aren't real collectors either.  They are financial buyers "investing".

For all other coinage, I can't tell you exactly who is driving the TPG demand.  However, there is a much better reason to believe it is predominantly Americans and not locals because US based buyers are used to paying the inflated prices created by TPG while locals aren't, graded coins are not prevalent in local auctions and in most countries, the coins are owned elsewhere (probably usually also by Americans) since there isn't any organized collecting either.

The other reason I disagree that most new collectors outside of South Africa expect to make a profit is because the sums we are talking about are financially irrelevant, most of the time.  In the USA, I'd guess that over 50% have annual budgets below $300 or maybe $500 (R4000 to R7000).  This number may be meaningful in South Africa but it isn't here and the reason I state it isn't because most Americans are wealthy or affluent. It's because this outlay is comparable to any number of other recreational activities where the person doesn't expect to get all of it back, not if they are a hobbyist.  Some of it  yes but not all, much less make a profit.  We can also know this by the coins they are mostly buying which are not  "investment" type coins.

If what I state for the USA is incorrect, then the hobby (the actual hobby) is in even bigger trouble than I believe it to be.

Edited by jwither

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jwither
11 hours ago, Cold Sea said:

I see the function of a Collectable's Society not one to create a market, but to assist existing and new collectors to that market through research, articles and preserving the institutional knowledge of seasoned collectors. To turn your words, "organic, not artificial". There are many past and present publications on our coinage, but books alone will not be catalyst enough. I have seen many questions being asked by newcomers on this forum that went unanswered, when I know that there are more knowledgable participants reading it, but opt not to answer.

I think I agree with what you wrote here but I don't believe it will do much to influence the price level.

I have mentioned this before but one of the problems is the limited variety in South African coinage compared to the United States and most other countries with established and longer term collecting traditions.  The only exceptions I know are Australia and Canada but in Australia at least, it appears there is still enough interest anyway.

I see little prospect for RSA coinage which now represents over 50% of all South African coins.  This is no different than in the USA.  Here, "moderns" (those currently in circulation mostly struck after 1964) represent a much lower proportion but let's "get real" about it.  There isn't much to write about it that will interest hardly anyone. Someone in the USA has written a "reference" book and certainly numerous articles exist on every coin series but the coin attributes are not sufficiently compelling, except to an irrelevant number of specialists (as I have described in the past) and the novice.  This novice is either predominantly a casual collector (collecting at face value or near it) and where they are not, switch to obsolete coinage ("classics") as their primary interest 99+% of the time as soon their budget permits it.

For Union, the coins have a much higher preference versus RSA but the disproportionate scarcity makes it impractical and probably discourages many (prospective) collectors.  This is an assumption since I have never been able to get anyone to clarify collecting patterns in your country.  My assumption is that lower budget collectors try to collect as many of the approximately 300 circulation strikes (excluding gold) as they can find plus the more common proof coinage (post 1946) also excluding gold.  Most higher budget buyers (notice I didn't say collectors) seem to randomly buy whatever is available based upon their perception of financial value.

The reason why this matters is because what I described adversely impacts interest in potential research topics.  For example, if South African collecting patterns followed those in the USA, someone could write something (anything) on each of the Union denominations by monarch.  There could also be a reference (of some sort) targeted toward collecting "by type".

However, I have never seen any indication that this describes collecting in your country.  Collecting by type would both make completion a lot more feasible and noticeably increase demand for the best specimens since many more collectors can pursue it versus trying to complete anything by date.

Collecting by denomination isn't practical, except for crowns and farthings.  Except in lower circulated grades, all of the other denominations either have a "stopper" (such as the 1931 tickey) or two many "key dates" (basically all of the others).  Collecting a denomination by monarch is somewhat easier but I don't believe the limited number of coins (eight to about 15) is sufficiently interesting to most collectors.

This leaves ZAR and the pre-Union "patterns" which is only about 5% of all South African coinage.  This is where the most interest lies but much of it isn't affordable to the majority of the collector base and I suspect (not actually knowing) that most research is already in this area anyway.

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testrarossa
On 8/28/2019 at 5:23 PM, testrarossa said:

Yes that’s why today Rand vs Dollar exchange rate is R15.3 to $1. 

 

 

Nearly 1 year later and it’s R17.3 to the $ now. 

Also with gold breaking $2000/oz its anybody’s guess where it be this time next year. 

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