Have you ever had that feeling that something just isn’t right? Perhaps it was in school; you had the answer, and despite checking and double checking the problem, something about it just didn’t look correct. Logic said that everything was in order, but your gut was telling you otherwise. That in a nutshell describes the July coin market. Our sales figures are historically on target for a July with both dealers and collectors. The Annandale Coin Show, which was our only show of the month, was solid if not even robust. Collector demand has been especially good for this time of year. Our price lists, online listings and print ads have also been good. So what then is the problem? Just like school, we are not exactly sure there is one. Just call it a feeling.
Reports and observations from coin dealers indicate two distinct markets. The dealers who exclusively rely on supplying other dealers are complaining about stagnant inventory and cash flow concerns. There is also a noticeable increase in fraudulent activity, another possible sign of underlying market challenges. Precious metals have been in a prolonged bearish cycle, which we contend, has a direct and negative impact on the numismatic sector of the marketplace. Nowhere has this aspect been felt more than at the coin shop level. Shop owners, who play a vital role in the supply chain of coins in the marketplace, have really been crying about the lack of fresh material coming in through their doors. This is something we never heard during the periods when metals rallied. Strong metals prices spur numismatic activity-there is absolutely NO doubt about that symbiotic relationship.
So, we are back to the chicken and egg argument. If retail sales are solid, and the coin shows we have been attending are equally good, is there really a problem? Do we simply turn a blind eye to the aforementioned challenges with the attitude that they don’t really affect us, therefore they are a nonstarter? Irrespective of how we interpret our situation or the coin market as a whole, there is no denying the funny feeling that we just are not firing on all cylinders. We have one more small show in Vienna, VA next week before heading to the all-important American Numismatic Association’s World’s Fair of Money in Philadelphia. Any uncertainties of the true state of the market or where it’s heading into the fall should be resolved there. If nothing else, we should have a solid read on market condition as a whole, and not just in our little bubble.