CNP Inc, Customized Numismatic Portfolios, Inc.

Special October 2020 edition

IMPORTANT UPDATE: Rare Coins and the Economy, Special October 2020 Edition

Lawrence Goldberg’s Rare Coin Report Update, October 8, 2020

Here’s some good news: Hard copy printing and sending of the Rare Coin Report will resume in early 2021. Meanwhile, I will be sending updates and articles by Email. The October publication of my Rare Coin Report is below, two articles: Notes from the Owner’s Desk, and “Rare Coins and the Economy - October 2020.”

Note from the Owner’s Desk

In addition to the Corona Virus, the Chinese have “gifted” us with a curse: “May you live in interesting times.” With Election Day closing in, a new contested Supreme Court nomination in process, the President, First Lady, and other officials testing positive, massive fires here on the west coast, social unrest in the streets, and not only divisive points of view, but what often appears to be divergent understandings of reality, that may be an understatement. One thing for sure: It is very distracting, and for many, including me, very upsetting. That is because it causes us to be fearful of a future that has not yet happened.

That said, things could be much worse: A major war could be happening; as bad as it already is, the virus could be much worse and far more lethal with no effective therapeutics or potential vaccines in sight; we could have major shortages of food and other necessities; a large sized meteor could smack the Earth…you get the picture.

The good news: these too will pass (especially that meteor!)

Meanwhile, we still live life one day at a time, or as my Dad used to say: “There are sixty minutes in an hour and do you know how much you can do in a minute?” Or, as T.S Elliot more poetically put it: “In a minute there is time for decisions and revisions that a minute will reverse.” We all have much more power to direct our futures than we think we have.

Now six months into the Pandemic, and it has been a trying time for all of us. But we will come through this. I have always been a great believer in the power of innovation, and the ability of people to develop creative, out of the box solutions to vexing situations, especially here in America. I am convinced we are in the process of making that a reality.

One thing I have said consistently – and this applies to much more than the coin market – is that when things seem crazy, focus on the big picture. Right now, about 20 feet from where I sit, I see a hummingbird making the rounds on a bunch of flowers. I can still see the sun, even if it’s through a bit of smoky haze. The grocery stores nearby are filled with all sorts of great food. My family is all healthy and we are persisting, putting a smile on whenever possible. I am grateful for these things.

My best wishes to you and your family, that you are healthy and in good spirits, and for all of us, that this plague will soon be ended.

Rare Coins and The Economy, October 2020

The big picture right now in coins is that despite Covid restrictions, we have a flexible, profitable, even robust trading environment that is conducive to both buyers and sellers. Under normal circumstances, this would be a prolific garden of exceptional opportunity.

To fully appreciate this big beautiful garden however, we must examine some “Covid” weeds.

The business models of coin dealers are in a state of flux that change and adapt by the minute. With few exceptions in only a few locations, there are no coin shows happening. I did attend a show in Las Vegas a few weeks ago, but only 50 fully masked people were allowed in the room at a time and instead of about 100 dealers, there were only about a dozen or two. The good news is that the 50 person limit has been expanded to a 250 person limit for the next show in late November. Hopefully that will be a trend, but a relapse could change things. Time will tell.

Online auctions are somewhat active as that business model was probably the least impacted area of the coin market. That said, many people don’t like the impersonal nature and photo dominant quality of buying online, much preferring to work with dealers at shows or at their offices, or through the mail. Some dealers, me included, are making more house calls to local and even somewhat distant customers. All masked up and with a plastic face shield for extra protection, we work in well ventilated rooms, or, weather permitting, outside. It is truly an amazing testament to human creativity how well we can function within the limitations imposed by the China plague!

One bright spot is the precious metals market. Gold and silver are way up from only a year ago. As a result, sellers can now realize outstanding profits, especially if they bought gold and silver 20 or more years ago. And yet, because of the massive monetary infusion by the Federal Government to ease the pain of the Pandemic shutdown coupled with the multi TRILLION dollar federal deficits arising from pre-existing economic conditions, the prospects for future inflation is huge, and that makes long term purchases of precious metals attractive at today’s levels.

I need to stress “long term,” because the recent precious metals price increases have been so strong that the short term upside for precious metals could well be limited for a year or two or even more as the market adjusts to these new higher price levels. That said, considering the many trillions of new cash dollars flowing into the economy, and likely much more to come… I can’t help but wonder what prices gold and silver will reach ten years from now? I’ve never been a strong hawk on precious metals prices, but looking out ten years, $100 silver and $5,000 to $8,000 gold seems realistic, even probable. (I never thought I would say that!)

With collector coins, the picture is chaotic. There are plenty of buyers and sellers, but the Covid restrictions have greatly slowed the mechanics of buying and selling. The lack of coin shows, limitations on travel, and people’s individual health concerns and situations have created an environment where it simply takes more time and effort to locate the coins that collectors desire. Likewise for dealers to trade inventory they don’t need for inventory they do need. In short, the market is less efficient.

Many people think – incorrectly – that this has reduced opportunities for good buys and sells: Nothing could be further from the truth. The silver lining in all this is that because of the restrictions, dealers are spending a lot more time in their private offices, using the phone and email to best advantage.

Furthermore, price levels are stable for the most part, so if it is a good time personally speaking for someone to sell, the market is in a cooperative mode, and prices are high enough to be attractive for sellers. It just might take a bit more time to find the right buyer, due to market inefficiency.

Ironically, one impact of market inefficiency is that it promotes pent up demand that will likely kick in 6 months or a year from now when the Covid problem has ameliorated. That pent up demand is almost certain to send prices upward, making now a good time to buy those tough collector coins when they become available.

So let me repeat: Right now, the big picture in coins is that despite Covid restrictions, we have a flexible, profitable, even robust trading environment that is conducive to both buyers and sellers.

Call me direct at (800) 334-3325 or email me at Lawrence@CNPCoins.com

I’m just back from a relaxing vacation and am rearing to go.
Let’s do some business!

Best Wishes,

Lawrence Goldberg
Customized Numismatic Portfolios, Inc.
800-334-3325

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