Are you better off being a collector in 21st century Britain compared

[Rob 3,228]

As I peruse old catalogues, one question that periodically occupies my mind is whether I am better off being a collector today compared to say the second half of the 19th century when the great collections of the likes of Cuff, Bergne, Brice, Shepherd or Montagu were assembled.

It is far too easy just to compare prices then and now without making allowances for inflation both in wages and the cost of coins. With the average UK wages standing at around the 25K mark, this translates to about £232 at the turn of the 20th century based on inflation in the intervening years. Against that must be compared the average wage for various groups of workers or people in certain positions. A Manchester bricklayer was on 10d /day while the average manufacturing job paid £36/year. At the other end of the scale, the Archbishop of Canterbury was on a stipend of £15K pa.whilst a keeper of a department at the British Museum was on £800 in 1896 and his deputy half that amount.

With Britain in a 20 year long slump that bottomed out in 1896, consumer prices were a quarter lower than at the end of the 1870s. The price of coins at auction broadly followed the price index down over the last 10 years of that period, but this merely reversed the strong upward movement of the 1870s when a considerable number of serious collectors were competing for the limited supply of quality coins available.

Whilst it is only possible to objectively discuss the high end coins as these are the only clearly identifiable prices, a ballpark estimate of relative cost can be made by comparing the cost of a Saxon London mint penny in Fine (probably today's VF as these lower grade coins would not be illustrated) - 2/6d, with the current ballpark figure of £200-250 for a common type. The same coin in VF in 1896 (today's gVF or better) was retailing at 3/6d. FDCs were about 8s. In the case of triple unites, in the Montagu sale of 1896, the eight Oxford coins sold for between £14 and £46, with most selling at more than twice the cost of 20 years previously. Today's VF triple unite would sell for say £50K, yet 20 years ago was making only £5K at auction.

Is the average man in the street today, in a better or worse position than his predecessor when it comes to collecting with consideration given to relative cost, relative availability, affordability, the number of collectors etc? It isn't a clear cut answer. Thoughts ladies and gentlemen, please.

[Paulus 1,980]

I started a response to this and my browser crashed, sorry ...

I will make a few observations, but I am not able to compare to the collector of yesteryear without research, and I suspect that you have already done that Rob!

• At the top end, I think many collectors (including myself) will consider themselves completely priced out of the market. For me, anything over £1k for a single coin is out of the question, which rules out most of the very top stuff. The inflation in prices for the most desirable coins seems to continue unabated
• I would guess that for the average wage earner today certain coin prices are cheaper than they have ever been, relative to salary ... including Roman, hammered, and late G5 and G6 silver in particular
• Silver bullion price is at its lowest for 3-4 years which will help low grade collectors
• The internet has of course opened up the world of coin supply to coin demand
• There is much less opportunity (in this country at least) to squirrel away collectable coins from change, than there was from our predecessors
• The availability of coins (via the internet) is surely at an all-time high
• Number of collectors relative to past times, I have no idea! There are more and more coins being listed on-line than ever before, and we get lots of new members on the Forum, but serious collectors who join and attend clubs, attendance at coin fairs, I have no idea!

Other Forum members will have far better insights I am sure!

[Rob 3,228]

Some coins have always been outside the range of the average bloke. A salary of £30 pa doesn't permit the purchase of a triple unite at a minimum of half that sum.

It's a difficult question that I'm not sure has an answer. So many choice pieces from past collectionbs have been squirreled away in museums, never to see the light of day again. Their removal from circulation means lower quality collections, but then, coins have never been more accessible than today. While you say you couldn't afford a £5K coin today, the chances are the same would have applied to a sub-£10 coin in 1900, but you have more disposable income today than you could ever hope to amass then. Today you have sufficient surplus to save up for something. Also, coins are continuously being found, meaning that yesterday's rarities are no longer so. Knowledge is not lost, so we can build on the past. That's a big positive.

[copper123 1,561]

I am sure i am better off being a collector in the 21st century.

Mainly because if i were a collector from the 19th cent I would be six foot under by now............

[pokal02 45]

Don't know about the 19th century, but would guess that the mid-1990s (exactly when I gave up for a few years!) was probably the best time in the last 30-40 years as prices mostly fell in real terms between the mid 80's & about 1999. It's definitely worse now than when I was seriously collecting before in the mid 80's. Some coins have completely drifted out of my price range in that time. In the mid 80's I saved up for 9 months to buy a (damaged) 1853 Crown at £775 thinking I'd one day be able to afford an upgrade at about £2k. Fine, except they've now gone from £2k to about £15k in about 10 years - more than inflation surely (and it's not even a type coin as the 1847 in much cheaper).

[azda 983]

Paulus seved a few Points. The middle to average collector cannot afford 1000GBP to Shell out on coins, the cost of living now in the UK with pressure of heating/fuel/taxes and generally being screwed by the Government for as much as they can get from the poorer collector means those People are priced right out of those type of Prices.

I personally collect coins in hopefully high grades, but also at an affordable Price, when/if the time Comes to sell any of These coins then they would also be affordable to the next collector as they won't be 1000GBP or upwards but would hopefully give me a return on what i've paid out for them.

Pauls other Point of the Internet is also true, what would it have been like back in 1896 if the Internet was around then coupled with digital photography, perhaps those famous collections would'nt have been so famous if those were avaliable at the time. I collect with the thought in mind that when the time Comes to sell, my coins will be affordable to the next man and in grades that are These days good Quality, but first and foremost i collect for me, but also bear in mind that These might go sometime during my collecting life.

[Rob 3,228]

The point I am making is that those unaffordable coins of today, would have been just as unaffordable to the likes of the majority of today's members had they been collecting at the time. In one way you are better off today because a good number of us in our current jobs would not have had the disposable income 120 years ago, but measured against that is the number of attractive items that have been systematically stripped from the collector's reach following bequests to various museums. Some household names in numismatic terms have deprived today's collectors of a lot of quality material, the likes of which has not been replaced and is unlikely ever to be in the future.

Henderson paid top whack and bought extensively at the Montagu, Murdoch and other large sales around the turn of the century, but then promptly gave the lot along with his library to the Fitz in 1933.

Blackburn museum's collection is entirely down to the Hart bequest in 1945.

Weightman and Clarke-Thornhill both gave the BM first pick of their collections, with the remnants being sold to collectors. Just look in the back of your copy of Peck to see the amount of material taken out of the system and then compare with the paltry remains listed in the Weightman sale of 1926. Baldwins complained at the time that the remains of the Clarke-Thornhill collection were barely worth having when compared to those the BM took (basically any examples of dies they didn't already possess - not just types).

C E Blunt assiduously collected coins of Marlborough mint to the extent that he had a virtually full set, but then gave them all to Devizes Museum. It is somewhat unhelpful that the majority of types are unique, with the other rarely offered. Birmingham Museum took Peck's George III coins in their entirety in lieu of death duties - again, many were unique.

Norweb gave her Charles I to the ANS.

J P Morgan's family offered the collection to the BM in 1915 after he died on the Titanic. Some were released to collectors, but again, a good number were upgrades for the museum collection.

All of these collections had first class material and this makes a severe dent in the quality of coins available, which in turn pushes up the price of the dwindling pool of choice pieces. That more of us have disposable income is a double whammy when it comes to prices for quality, but then it has to be set against the fact that you are at least able to play the game if you save up. The cost of individual pieces is not so much of a problem. A coin costing a half-crown in 1900 is little different to today's purchase of a few hundred pounds in relative terms to the daily wage.

[TomGoodheart 446]

My personal view as an exclusively on-line collector is that I'm better off now!

The ease with which information can be gathered and referred to I'm sure makes collecting a simpler task than it used to be. Plus where I would have had to write a letter to another collector who might then have introduced me to someone sharing my interests, I now just send an email and get a friend's opinion on a coin within minutes. Similarly I can and have bought worldwide as far as the US, Australia and Europe. In the old days it would have taken far more effort to find stock or auctions internationally and likely I would have had to fork out significant sums to be on the mailing list of a comparable number of dealers as I am able to access by the internet.

Yes, there are star coins that have disappeared to museums or collections I will never access. Though as a care worker, probably these would not have been within my budget when they were available to collectors.

But I only started collecting about 10 years ago. Looking at relatively contemporary collections such as Brooker's and even Ashby or Hughes' there are some great coins. But there are also some that I feel I have a better example, or at least a comparatively acceptable one. So the fact that I can't afford a Lockett / Murdoch/ Montague provenance coin is not one that troubles me greatly. I look for the best I can find, or what I feel has good eye appeal and that satisfies me.

And who knows? With a bit of luck in a decade people will be complaining that they can't find coins to compete with those from my collection! ... Or a huge hoard will be discovered containing enough top grade rarities to satisfy the entire next generation of collectors!

.

[sound 25]

Worth also considering globalisation and emerging markets.

This has not just been a cyclical adjustment but a once in a generatation or an even longer adjustment. The effects are clearly structural.

More money, probably more collectors as wealth increases have pushed up prices. Will this reverse? Probably not, of course there will be price adjustments, there always will be. However it's now a different playing field with money chasing quality from all over the world.

The other thing to think about is that coins along with stamps, pens etc will not be around that much longer. This should support the market as the smart money joins in.

So back to Rob's original question is the 'man in the street' better or worse off? From a collecting point of view it's getting more expensive and will continue to do so with high grade material, including common coins. For the investor? That's a different matter, or perhaps they are one and the same thing and many collectors just don't think of themselves in those terms.

Mark

Edited November 19, 2014 by sound

[Peckris 579]

"The Internet changed everything". Or did it? I think the only real difference the interweb has actually made (apart from making research easier, and to save on expensive catalogues) is to ensure the greatest quantity of crap is placed before us more frequently than ever before. Finding quality items is as difficult as ever, i.e. collectors for the mid-to-top end material, if not actually harder as the supply of predecimal coins is finite and ever-shrinking.

I don't think prices have gone up beyond all reason : Seaby/Spink have been saying for decades that the UK market was undervalued, and maybe now it is finding its true level. Or at least, the highest levels since the early 80s, when being a collector was no easier than it is now.

However, let us also not forget that prices do go through peaks and troughs over periods of time. I would say that now is not the best time to buy, as we are due a slump in values, or possibly a stagnation such as we saw between the mid-80s and mid-90s.

[sound 25]

'However, let us also not forget that prices do go through peaks and troughs over periods of time. I would say that now is not the best time to buy, as we are due a slump in values, or possibly a stagnation such as we saw between the mid-80s and mid-90s'

Think that is right, however the change has been significant. Prices reflect that, some levelling off is inevitable.

Interesting that when stock prices plummeted in the 1997 drop, shortly 'some' real assets shot up including oil, grain commodities, coins and stamps. All things the emerging market money was chasing.

What would it take to cause a 'significant' drop in coin prices? A flood of new stock coming onto the market, unlikely. A shortage of new money coming into the market, again unlikely at present with interest rates so low. Perhaps a levelling is what we will see.

Are their any areas that have some catching up to do? Are some EF valuations undervalued agains uncirculated coins?

Mark

Edited November 19, 2014 by sound

[PWA 1967 2,268]

Buy and enjoy collecting and keep smiling dont look at the investment as no gaurantee.The experts might make a good few quid and good look to them.I go with the opinion you have an interest and makes it interesting.If you do ok all the better but spending money on coins for an investment NO

[copper123 1,561]

As long as collectors hold the above opinion , we will have a very healthy hobby

[Coinery 1,254]

OK, as far as I'm concerned, there are people who collect whimsies (I think that's what they're called), and also those who collect beer mats...to me they have the same collecting mentality and passion as I do, and I totally (honestly) get where they are coming from!

For me, however, this particular passion (coins) wouldn't have any of its magic if it didn't occasionally mix in some of the dangers involved in cliff-edge finance, and of the importance of getting things right, though sometimes wrong.

Also, if it didn't occasionally drop me into another period, and into the life and times of a bygone age, I'm not sure I'd feel quite as involved!

If I couldn't take that daring gamble once and a while, if I couldn't spin the roulette wheel and gamble that the money would be there for a wonderfully daring bet...

I love all these things about collecting coins! I love pitting my wits and growing in knowledge, and also love making the next pitch, just a little higher up the league table! Man, I'd be so bored if I collected beer mats!

[azda 983]

I wonder ifthe stamp collectors have the similar discussions as we do. I bet they don't get into TPG rages though

[Coinery 1,254]

I bet they don't get into TPG rages though

I really do have to bite my tongue at the various threads associated with TPGCs! So many of those who care to write reams and reams on the ridiculous subject, are often the same people that are doing it with the intention of 'baiting' the forum. I never understand why the last sentence is always laid out to antagonise.

They know why they collect slabs, (then they add something like this) the same as we do!

[Rob 3,228]

I don't think we will see a slow-down in top end material prices until interest rates return to a realistic, above inflation, rate. Artificially low rates don't help anyone. The idea that it will force people to invest in the economy and create jobs is pie in the sky. That involves a risky venture with no quick exit-route. Putting your money into commodities and collectables however is a position that is markedly easier to extract yourself from, whilst still offering the chance of a real return. That has to be part of the reason that desirable pieces have exploded in price, as the best will always find a new home with relative ease.

[sound 25]

I think the rising of interest rates may be some time off with deflationary forces at work.

So called 'normal rate's will not return in a hurry. It could be argued we have returned to the normal non inflationary world that world was in up to the late 1960's.

Interesting times.

Mark

[Paulus 1,980]

My guess is that we've never had it so good (in the words of MacMillan in the early '60s), make hay while the sun shines

[Coinery 1,254]

you speak for yourself, Paulus, I can barely afford to keep a wine glass filled at the moment!

I'm happy, though, and can enjoy the simple pleasures of collecting photographs and reading all about the joys of buying coins!

Edit: I've just realised I haven't bought a coin in over 12 months!

Edited November 19, 2014 by Coinery

[Paulus 1,980]

My own personal financial situation is terrible compared to 3 years ago, I meant in terms of the UK economy as a whole! We have low inflation and interest rates, growth, declining unemployment, I studied economics not politics by the way!

Whether this is good for overall coin prices I am not sure, perhaps prices at the top end do better when economies are in crisis, I would love a deLorean to go back in time at bit (as would we all of course!)

[Rob 3,228]

It's important that interest rates return to real values because it sends out the wrong message when too low. Low rates encourage the profligate to borrow beyond their means and lay the seeds for another consumer disaster. Those that don't borrow meanwhile have to park their money somewhere where it will earn a real rate of interest. If I can in something and get 1% over inflation after tax, I'm a happy camper. Part of the problem is that a 'healthy' economy requires people to buy things they don't really want, and the most likely candidates are those who don't have the money. Consumer spending is under control at the moment because memories are too fresh, but give it a couple more years and the same old story will repeat itself.

We need to make things and export our problems. Then we can spend without much concern.

[sound 25]

Rob,

There is a lot in your post that makes sense. The down side of globalisation is that 'things that are made' tend to get done where labour is cheapest. Increasingly GB has to become high tech or service oriented to survive.

If we want to make things then we need some cheap labour to compete. Now where would that take us? LOL.

Mark

[Peckris 579]

It's important that interest rates return to real values because it sends out the wrong message when too low. Low rates encourage the profligate to borrow beyond their means and lay the seeds for another consumer disaster. Those that don't borrow meanwhile have to park their money somewhere where it will earn a real rate of interest. If I can in something and get 1% over inflation after tax, I'm a happy camper. Part of the problem is that a 'healthy' economy requires people to buy things they don't really want, and the most likely candidates are those who don't have the money. Consumer spending is under control at the moment because memories are too fresh, but give it a couple more years and the same old story will repeat itself.

We need to make things and export our problems. Then we can spend without much concern.

Funnily enough I said exactly the same to my financial adviser last year when discussing how to invest my pension lump sum. He asked me to rate myself on a scale from Low to High Risk strategy. I told him I was very Low Risk - all I wanted was "a return that does a little bit better than inflation". He then told me that such a strategy required a Medium Risk investment strategy as the very minimum!!!!

[sound 25]

It's important that interest rates return to real values because it sends out the wrong message when too low. Low rates encourage the profligate to borrow beyond their means and lay the seeds for another consumer disaster. Those that don't borrow meanwhile have to park their money somewhere where it will earn a real rate of interest. If I can in something and get 1% over inflation after tax, I'm a happy camper. Part of the problem is that a 'healthy' economy requires people to buy things they don't really want, and the most likely candidates are those who don't have the money. Consumer spending is under control at the moment because memories are too fresh, but give it a couple more years and the same old story will repeat itself.

We need to make things and export our problems. Then we can spend without much concern.

Funnily enough I said exactly the same to my financial adviser last year when discussing how to invest my pension lump sum. He asked me to rate myself on a scale from Low to High Risk strategy. I told him I was very Low Risk - all I wanted was "a return that does a little bit better than inflation". He then told me that such a strategy required a Medium Risk investment strategy as the very minimum!!!!

Yep low risk means losing money against inflation. One could argue wreath crowns are low risk, they keep climbing every year.