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My Five Worst Trades
 | By Mike Thorne, Coins Magazine
January 21, 2008 |
Have you ever bought a coin or coins and later discovered that you paid too much? How about coin trades? Have you ever made a trade that seemed fair at the time but turned out to be a bad deal for you later?
Well, if you've been involved with coins for any length of time, then I suspect you have some stories that you could relate in response to my questions. Because I've been a coin collector/dealer/investor for more than half a century, I have many stories to tell.
Fortunately, I've grown more philosophical over the years, so even though some of the stories are quite painful, I don't mind relating them to you. Perhaps there will be a lesson in my misfortunes that will save you from making similar mistakes.
Before I get started, I want you to know that for each of my bad experiences as a coin person, there have probably been dozens of good experiences. Of course, if that weren't the case, then my numismatic activities would have extinguished long ago. This is just basic learning theory: Responses without reinforcement lead to extinction. Obviously, enough of my numismatic experiences have been reinforcing to keep me active as a coin collector.
Bad Trade No. 1: Swapping a 1914-D Lincoln cent for a 1931-S Lincoln cent.
I don't know that this was the first of my really bad trades, but it happened fairly early in my collecting history. At the time, I was a student in high school who spent many evenings looking through rolls of Lincoln cents. This was in the mid to late 1950s and scarce Lincoln cents were still possible to find in circulation.
Like most collectors of the time, I was working on a date-mint set of Lincoln cents - filling holes in an inexpensive, blue Whitman folder. Although I had found almost all of the dates in some condition, a couple of holes remained empty. As you can probably guess, the two empty holes in my album were for the 1909-S V.D.B. and the 1931-S.
Because I grew up in Shreveport, La., the coins in circulation were predominantly from the Denver Mint. Philadelphia coins were common because of large mintages, and coins from San Francisco were relatively scarce.
In my roll searches, I had found a couple of 1914-D cents, so I decided to swap the worst one of the two, which probably graded Good-4 with a few minor nicks, for a 1931-S. Looking at my 1958 A Guide Book of United States Coins, I see that a G 1914-D was worth $15, a Fine 1931-S listed for $7, and an Uncirculated 1931-S was worth just $14. I must have figured that the nicks on my 1914-D knocked its value down below the level of an Unc. 1931-S, because I advertised in a trade publication that I would trade my coin for a Fine or better 1931-S.
As it turned out, I got lots of responses to the ad, with several people offering VF or Extremely Fine or even About Uncirculated 1931-Ss for my 1914-D. Before I got these responses by mail, however, a man who lived in Shreveport called to offer me an F 1931-S for my 1914-D. As an adult, I would now say, "My ad just came out, and I haven't even gotten any letters about it yet, so I think I want to wait to see if there are any better offers. Give me your phone number, and if the Fine is the best I can do, I'll give you a call."
But I was an easily intimidated kid, so what do you think I did? That's right, I told the man to come on over and traded my 1914-D for his 1931-S. As I indicated above, after I made the swap I began to get letters from people offering much better 1931-Ss for my coin.
It gets worse: The 1931-S I took in trade was an odd reddish color, like it had been in a fire. I never liked it and got rid of it as soon as I upgraded to an AU-58 1931-S I bought in a little hole-in-the-wall coin shop in New Orleans for $27.50. My father-in-law, incidentally, thought I was crazy to pay so much for a "penny."
Bad Trade No. 2: Swapping an AU Barber quarter for low-grade Buffalo nickels.
This is another of my ill-fated coin trades when I was a youth. Actually, I don't remember the details of this trade, which is probably just as well, but as you'll see, the broad outline is bad enough.
I got a couple of really nice Barber quarters when I was a young collector. They were both from the New Orleans Mint (1897-O and 1904-O), and I'm pretty sure both would grade AU by today's standards. That particular grade wasn't listed in the 1958 Red Book, but the coins were probably worth around $25 apiece at the time. I had gotten one from a friendly trolley driver for face value and the other from a fellow student for 30 cents.
In addition to my Lincoln cent collection, I was trying to fill a Buffalo nickel album. Buffalo nickels were plentiful in circulation in the 1950s. At some point, it occurred to me that I could facilitate this process by swapping one of my quarters for several better-date Buffaloes.
So I responded to an ad offering to swap better-date Buffalo nickels for Barber coins. I offered my nice Barber quarter (I don't remember which one) for a sizable number of low-grade Buffaloes. We agreed on a trade, and I sent my quarter.
Soon, I received a package in the mail, which I eagerly opened. Unfortunately, all the Buffaloes were overgraded, in my opinion. I had wanted coins that at least had full dates, and several of the ones I received didn't meet that criterion.
In response, I immediately repackaged the nickels and mailed them back to the person who had sent them to me. Oh, did I tell you that to save money on postage, I didn't insure the coins?
Can you guess what happened? When I didn't hear from the trader, I wrote asking if he had gotten the nickels and when would he return my quarter. "I never got them," he responded. "Just file a claim for the insurance."
Bad Trade No. 3: Trading a 1936-D Washington quarter for a 1932-D Washington quarter.
This is a trade that must have seemed good at the time, but in retrospect, it was bad in several different ways. Again, this was one of my childish mistakes.
Toward the end of my high school years, a combination bookstore/coin shop opened in downtown Shreveport. At the bookstore, the owners, a husband and wife, would trade their coins at full Red Book for your coins at half Red Book.
The problem was that they didn't know how to grade very well, plus they were unaware of the extent to which damage affects a coin's value. As a result of these defects in their knowledge, they eventually wound up with a bunch of unsaleable junk and went out of business.
I would like to tell you that I never took advantage of their ignorance, but I would be lying to you if I did. The truth is that I got several really nice coins from the store for coins I had found in circulation that were worth little because of one problem or another. In one such trade, I acquired a couple of uncirculated 1936-D quarters.
Looking at Red Book values, I decided that one of my 1936-D quarters might be a good trade for a nice 1932-D. According to the 1958 Red Book, a 1932-D in Unc. was worth $62.50, whereas a 1936-D was worth $45 in the same grade. Surely my 1936-D was worth as much as an AU 1932-D.
In fact, the 1932-D I took in trade was really no better than EF, had been cleaned, and had a noticeable scratch on the reverse. Why did I trade my no-question Unc. 1936-D for it? Who knows? The point is that it was a bad trade for me when I made it and an even worse swap later on. At current retail prices, the 1936-D in Mint State-63 is a $1,000 coin, whereas an EF 1932-D without a scratch is worth a third as much. With a scratch, it's worth considerably less than that.
Bad Trade No. 4: Coins for coin holders.
Before you conclude that all the bad trades I made were when I was a young collector, the last two I'm going to tell you about were made when I was an adult. In fact, they were made when I was in my late 20s.
The first involved trading nice coins - duplicate keys, semi-keys, and better dates - in higher grades for Capital plastic holders. These are the kind of holders made from three pieces of plastic: two pieces of thin, clear plastic, with a thick piece of holed plastic in between.
My collecting history runs as follows: I started collecting when I was in junior high school (middle school today), put aside my collecting for the most part when I went to college, and then picked it up again when I got my first (and only, as it turned out) permanent job. As an adult collector, I concentrated initially on completing and upgrading sets I had worked on earlier.
By this time, I had discovered that it was not a good idea to keep coins in the inexpensive albums of my youth, so I switched to albums with plastic slides protecting the obverse and reverse of the coins in them. Visiting a coin shop in Shreveport, I discovered an even better type of album: Capital plastic.
The problem was that Capital plastic albums were much more expensive than anything I had used before, and I didn't feel that I could afford them. Of course, I had lots of duplicate coins, so it seemed logical to swap some of them for the better holders.
It never occurred to me that ultimately the holders would be worth virtually nothing, whereas the scarce coins I traded for them would continue to rise in value. Needless to say, this was not one of my better trades.
Bad Trade No. 5: Trading genuine coins for a fake 1909-S V.D.B. Lincoln cent and 1916-D Mercury dime.
When I got back into coin collecting in the early 1970s, I realized that I was missing some major keys needed to complete the sets I had been putting together as a youth. One of these was the 1909-S V.D.B. Lincoln cent and another was the 1916-D Mercury dime.
At the time, the two were worth much less than today but were still relatively expensive. According to the 1971 Red Book, the 1909-S V.D.B. was worth $120 in Fine, $145 in EF, and $200 in Unc. The 1916-D listed for $95 in Good, $125 in VG, and $185 in Fine. I'm not listing other grades for the 1916-D because my limit for spending was much lower in those days than it is today.
I can think of at least three different ways that I could have acquired these coins. One way would have been to just buy them from one of the myriad ads I saw in the coin periodical to which I subscribed. Another way would have been to trade for them, and the third way would have been to sell some of my duplicates and then use the money to purchase the coins I wanted from an ad. Undoubtedly forgetting all of my previous bad trades, I chose to trade for them.
Thus, I ran an ad that told what I was looking for, listed some of the good coins I had to trade, and gave my home address. This ad had two primary effects: First, it put me in touch with a man who later died in prison. Second, it set me up for a home burglary, but that's a story for a different article.
As for the man who died in jail, he sent me what appeared to be a nice 1909-S V.D.B. and a nice 1916-D Mercury dime. In return, I sent him the appropriate value in some of the nice duplicates I had, such as AU and Brilliant Uncirculated 1931-D dimes, BU 1936-D quarter, etc.
Not long after making this trade, I read in the coin paper that my trading partner had been arrested. It turned out that he and another fellow had a "factory" in which they turned out popular key coins, such as the 1909-S V.D.B. Lincoln and the 1916-D Mercury dime. At the end of the ad, there was a number to call to get in touch with the Secret Service agent in charge of the case.
I called the number and was advised to send in the two coins I had received, and the Secret Service would determine whether or not they were fake (had added mintmarks). At this point, you may be asking yourself why I didn't send the coins to a certification service. Well, the answer is that the major services hadn't been invented yet. As soon as the American Numismatic Association Certification Service (ANACS) came into being, I made myself a rule that I would send any coin that I paid more than $50 for to them to be certified. I think the first coin I submitted was a 1909-S Indian Head cent, for which I had paid exactly $50. It was genuine, by the way.
So, I sent the 1909-S V.D.B. Lincoln and the 1916-D dime to the Secret Service agent and sat back to wait for his response. I quickly discovered that the crook I had gotten the coins from was a lot easier to deal with than the Secret Service. All I wanted from them was a signed letter stating that the coins were fake and not worth what I had traded for them, but it never came. That is, it didn't come until I contacted one of our senators and asked him to intervene. I got the appropriate letter rather quickly after that.
The reason that I wanted the letter was that I had a big hobby loss that year (Remember the home burglary I mentioned?) and wanted proof of loss to get as big an income tax deduction as possible.
At this point, you may be wondering if I've ever had any good trades. Well, the answer to that question is yes. Without going into details, I'll tell you about one trade that worked out pretty well.
This good trade involves a real 1909-S V.D.B. Lincoln cent. Not long after the start of the state quarter series, I decided to get rid of my set of mostly BU Washington quarters. I traded several nice quarters for an AU 1909-S V.D.B. cent, which, of course, was certified. Although the quarters have gone up in value since I made the trade, they haven't risen nearly as much as the 1909-S V.D.B.
Nowadays, rather than trade one coin for another, I would almost certainly sell the coin I didn't want and then use the money to purchase a coin I wanted. Also, I'm a strong believer in the value of coin certification - slabbing - particularly if it's done by one of the major services.
In summary, think long and hard before swapping any of your good coins for someone else's. Of course, if you do decide to make a trade and it doesn't turn out well for you, you can chalk it up to experience and vow to never make the same mistake again. If you're a writer, you can always recoup your loss by writing about your bad trade.
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