What Impact National Gold Exchange Bankruptcy?
July 28, 2009
Yesterday bags and rolls of American Samoa quarters went on sale at the Mint and the news hit the hobby that a major player, National Gold Exchange of Tampa, Fla., filed for bankruptcy protection Friday.
Both items are important to the future of the hobby, but if I had to make a bet, I would say that the readers of Numismatic News would consider the availability of the quarters they are trying to collect to be more important than the business news.
I am equally sure that commercially active readers would have the opposite opinion - there just aren't as many of those.
There is no question that National Gold Exchange was a player. At shows it had multiple tables in prominent locations on the bourse floor.
The question becomes one of assessing damage. Did other dealers see it coming and protect themselves, or is there a lot of paper out there. "Paper" in hobby parlance is issued but uncashed checks, but primarily unpaid invoices called memos whereby one dealer gives a coin to another dealer on memo, trusting that he will be paid when the second dealer sells the coin.
There are always secondary effects. Who bought something last week planning to sell it to someone else who in turn would be offering it to NGE?
The disentangling process will be the topic of many a conversation at next week's American Numismatic Association convention in Los Angeles.
Something to add? Notice an error? Comment on this blog.
About the Author