2014 Top 10 Stories: Gold Kennedy half dollars draw crowds
- Published: Dec 31, 2014, 7 AM
Editor's note: The Top 10 Stories of 2014 have been judged by Coin World staff to be the most impactful and memorable numismatic stories of the past year. They are not ranked in any particular order.
New product releases by the U.S. Mint generally don’t trigger literal customer stampedes, but 2014 witnessed a Mint marketing effort that did just that, an effort that almost everyone agrees went awry.
The Mint celebrated the 50th anniversary of the 1964 Kennedy half dollar’s release with three different products in 2014: a two-coin set of Uncirculated copper-nickel clad Kennedy half dollars; a four-coin set of silver half dollars (each with a different finish and struck at a different Mint); and a .999 fine gold version in Proof, this latter coin from the West Point Mint with a dual anniversary date of 1964 – 2014.
The release of the gold version was meant to be special but proved fraught with problems.
Mint officials decided to launch sales of the gold version — the first U.S. half dollar struck in that metal — concurrent with the American Numismatic Association World’s Fair of Money in Rosemont, Ill.
Sales began simultaneously at the Mint’s traditional sales venues (its website and telephone order line), and at the Mint booth at the ANA convention and three of its physical Mint facilities in Denver, Philadelphia and the District of Columbia. Sales opened at noon Eastern Time Aug. 5 at all venues.
The Mint offered limited quantities of the gold coins at the four physical venues, and further, restricted sales to one per person per day.
Demand for the coin paired with those restrictions led some prominent dealers to pay people, many of them noncollectors, to stand in line (some for hours) to purchase a coin. These dealers funded the purchase price of the coin, and these buyers agreed to turn over their purchase to the dealers.
The dealers then quickly had the coins slabbed with special grading service labels, and immediately offered the specially labeled gold half dollars at prices well above the Mint’s issue prices.
At the Rosemont ANA show site, the line of potential buyers aiming at the Mint booth began forming in the night before the first day of sales, with the first four people in line traveling all the way from California just to buy the coins.
The first Proof 2014-W Kennedy gold half dollar the U.S. Mint sold at the ANA convention, bought by one of the four Californians, rose in price from its issue price of $1,240 to $100,000 in just a few days.
The first person in line at the show sold his coin Aug. 5 to dealers Kevin Lipton from Kevin Lipton Rare Coins in Beverly Hills, Calif., and David Hendrickson, president of SilverTowne in Winchester, Ind., for $5,000 and a replacement coin.
In turn, the two dealers reported on Aug. 7 that they had sold the coin, slabbed with a Professional Coin Grading Service label identifying it as the first sold, to an unnamed collector for $100,000.
Ending sales early
Mint officials initially planned to sell the coins at the ANA show every day from Aug. 5 to 9, and at the Mint facilities through Aug. 8. However, an ugly incident outside the Denver Mint on Aug. 7, captured on tape by local news media, led Mint officials to cancel all remaining in-person sales, citing safety concerns. A large crowd standing across the street from the Denver Mint stampeded when released by police officers as that day’s sales began. Video showed people rushing to the Mint entrance, with a number of individuals falling or being pushed to the ground.
The Mint’s initial efforts at in-person sales received a fair amount of criticism beyond the safety concerns. Some dealers at the ANA show not involved in the purchases said the crowds waiting to buy the coins disrupted their sales. Some collectors found as disturbing the tactics of the dealers paying others to buy the coins so as to circumvent Mint sales restrictions.
Prices rise, then fall
It is clear that much of the initial interest in the coins was from buyers who hoped to have the coins placed into special grading service holders and quickly flipped for a sizeable profit above the initial issue price of $1,240. Some buyers at the ANA convention on the first day did just that, selling their coins for more than $3,000.
However, the glitter quickly fell from the coin as, before long, prices dropping to below issue price. Late in the year, when the Mint was selling the coins at $1,165, a piece graded Proof 70 Deep Cameo sold for $1,101.10 at auction.
Most purchases of the gold coins occurred right after dales began. During the first month of sales, 63,927 of the coins were sold. With the maximum mintage limited to 75,000 pieces, 69,299 had been sold as of Dec. 21; clearly, sales fell off sharply after the initial rush of the first few weeks.
The experiences of in-person sales for the gold coin may have been a factor in a decision by U.S. Mint officials to not conduct in-person sales of the four-coin 2014 50th Anniversary Kennedy Half Dollar Silver Coin Collection, which went on sale Oct. 28. The fall Whitman Baltimore Expo, which opened Oct. 30, could otherwise have been a likely venue for such in-person sales.
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