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Mistakes of 1980 Again?
August 31, 2011

Times are good for coin dealers who are also buyers and sellers of precious metal coins and bullion.

They are making huge profits.

What are they doing with them? That is a key question.

When I interviewed Tampa, Fla., dealer Lance Tchor at the American Numismatic Association convention two weeks ago in the Chicago suburb of Rosemont, Ill., he was enjoying very good times.

But he also volunteered the information that at the 1980 peak, “I was young and stupid.”

He said every dollar he made then he blew and that he has learned from it.

The obvious way of blowing profits is to live high on the hog.

The less obvious way is one that hit the whole coin industry in the aftermath of the bullion boom of 1980.

Dealers then were recycling their profits into collector coins and bidding up the prices of certain series to incredible levels.

However, when their gold profits fell, so did the prices of many coins.


Nobody had the money to bid for them at those levels.

Numismatics had a hangover not of its making.

Can it happen again?

I think it can.

When you analyze prices of coins you are interested in, don’t forget to ask yourself what might happen to them if the dealer community’s current large bullion profits go away.

Will there still be support for these prices?

That at least will keep you from getting carried away.

I remember holding a marquee 1804 dollar at the 1980 Central States convention. Its price was at a record level, but it then was unsalable at that level for years afterwards because the hobby’s cash flow from the bullion business had shrunk.

So be cautious and plan to hold your purchases for the long term.

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About the Author
David C. Harper has been a coin collector since 1963. He joined the Krause Publications editorial staff in 1978 and is currently editor of Numismatic News and World Coin News. He also edits two books annually, North American Coins & Prices and Coin Digest. He is the author of the Class of '63 column that runs each week in Numismatic News. His first bylined numismatic article appeared in the June 1971 issue of Coins Magazine and his various Krause Publications assignments included a stint as editor of the magazine 1980-1983. Harper received a bachelor of science degree from the University of Wisconsin-Oshkosh in 1977. He had a double major of journalism and economics.

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