In an era where unique, precious objects continue to shatter records when they come to auction, are rare coins undervalued or overvalued?
Major international auctions in November confirmed the strengthened “masterpiece mentality” of the market for rare and desirable objects.
At a Nov. 13 Sotheby’s auction in Geneva, Switzerland, “The Pink Star,” a 59.6-carat oval fancy vivid pink diamond sold for $83.2 million. The day before, Christie’s Geneva sold “The Orange,” a 14.82-carat diamond considered the largest fancy vivid orange diamond in the world, for $35.5 million. Experts predict that the prices for colored diamonds will continue to rise as the mines from which they are found become rapidly depleted.
Today, buyers are paying prices for top-level objects that only a few years ago would have been deemed unrealistic. Traditional value hierarchies are shifting and new peaks are being established.
As auction houses have fewer key works in the Old Master and Impressionist/Modern categories to sell, they are focusing on building the market for Contemporary art. It’s working, as evidenced by the dizzying results from Christie’s and Sotheby’s November Contemporary auctions that reached $1.25 billion. Simply put, more masterpieces are available in this category to fill auctions and meet demand.
This fall both houses had key contemporary paintings that exceeded $100 million. Sotheby’s 1963 Andy Warhol Silver Car Crash (Double Disaster) brought $105.4 million while Christie’s hit the jackpot with Francis Bacon’s 1969 triptych of painter Lucian Freud for $142.4 million, establishing a record for any work of art at auction.
After the latter sale, Brett Gorvy, Christie’s worldwide head of Postwar and Contemporary art, provided a defense against those who said that these stratospheric price levels aren’t sustainable, saying, “This isn’t a bubble, it’s the beginning of something new.”
In the fine art realm, $1 million doesn’t go that far. But, $1 million can put together a magnificent coin collection.
Taking the recent auction of Eric P. Newman’s collection as an example, $1 million spread evenly throughout the mid-five-figure coins would yield an impressive, diverse collection full of high-quality rarities that would earn a prime spot in nearly every collector’s cabinet.
One wonders how the prices of today’s seven-figure coins will hold up in a decade.
Will the $1,527,500 that a bidder paid for Newman’s exceptional 1796 Draped Bust quarter dollar seem like a bargain in the same way that Newman’s original $100 purchase price for the coin appears today? As the top rarities in other collectible categories become inaccessible, will the top of the rare coin market soar even higher?