August 31, 2007, Newsletter Issue #81: Scarcity versus Value

Tip of the Week

You're mad about the 18th century, but everyone else is living in the 21st, or at least the 20th. You can't understand why people prefer a World War I coin to a gold piece from our nation's birth.

Take a tip from real estate: scarcity is no guarantee of value. If everyone wants the condos in the hot new development and only two people (including you) ask to see that Colonial home for sale, which is more valuable? As with most things financial, the question is one of supply versus demand.

Some tips to determine if your coin is in demand:

* Is it a WTB, or Want to Buy, on the Internet?
* How large was the run? The more coins that were minted, the more that will likely be in existence, especially in modern times.
* If the market is flooded with Eisenhower silver dollars, coin values will be less. A glut can drive down coin values and coin prices.
* How rare is the coin? Is it one with a lot of hype, such as the 1804 silver dollar "King of Coins"?
* Is it a requested coin at coin shows and coin shops?
* Do more of the coins survive in Good if not Brilliant grades? While this is no determiner of coin value, perception, as in every aspect of life, trumps reality. More coins from World War I survive than Revolutionary War coins.

If you want to collect 18th century coins, don't be deterred by questions of US coin value. For every coin out there, a buyer exists. You should buy what you find attractive. However, you might want to lose the tricorn hat and wooden teeth.

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