Rational values: Considering current prices for rare coins
I recently received a mailing from an art dealer in New York City specializing in 19th and 20th century American paintings.
The message was simple. It asked, “Why is the combined value of a coke bottle, a car crash, and a balloon dog worth more than the total value of every American 19th- and 20th-century painting sold at auction in the last three years?”
It answered, “Because it’s no longer good enough to just keep up with the Joneses. Why not buy what you love — seek rational values.”
The mailing cheekily refers to eight-figure works of art by Andy Warhol and Jeff Koons that have sold at auction recently, and pokes some fun at the meteoric rise of the top of the contemporary art market over the past few years.
It was especially appropriate in the wake of mid-May’s Contemporary and Modern painting auctions in New York City, which brought more than $1.5 billion and included nearly 20 works that sold for more than $20 million each.
Christie’s Brett Gorvy had promised before the auctions that the sales would resemble “gladiator sport at the highest level.”
Rational values is something that a market loses when the heat is turned up, as it is with the contemporary art market.
In contrast, in a decade, how will the prices achieved for the various coins and tokens in the various Eric P. Newman auctions be considered?
The top coins at these sales have rested at the $1 million to $2 million level and even the top rarities in American numismatics like 1913 Liberty Head 5-cent pieces and 1804 Draped Bust silver dollars trade at the $2 million to $4 million level at auction.
The art dealer’s directive: “buy what you love — seek rational values” seems especially fitting in today’s market where the number of old collections coming to market dwindles each year.
Coins from old collections like Newman’s may seem pricey now, but history has a tendency to reward quality and rarity with price appreciation.
A great coin collection isn’t likely going to help you keep up with the Joneses (unless they’re coin collectors), but when compared with other markets, even expensive coins seem to provide rational values at their current price levels.