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2014 Australian Coin Values Book Smackdown - Who Will Come Out On Top?

When the 2014 editions of both of Australia’s coin and note price guides were put out in late November last year, we sold more copies of both books in December than we have in entire years previously - I don’t think it’s too far a stretch to say that interest in coin values is stronger now than it ever has been.

I strongly believe that it’s incumbent on each one of us to do our own due diligence when buying or selling, yet at the same time, over the past 6 months I’ve heard feedback from collector after collector that they’re jack of buying books that simply don’t help them make the decisions they need to make when buying and selling.

This problem goes far further than shelling out $40 for a book that you only look at once and then toss away in disgust - to the degree that these catalogues include figures that cause sellers to come to market with wildly optimistic notions of what they might fetch for their items, they’re preventing supply from entering the market in an efficient manner.

Further, to the degree that they don’t inform buyers of the real value that’s available in the market at the moment - right across the board and not just in one market segment, they're preventing new buyers from entering the market.

Nobody is served in these circumstances - sellers can’t sell, buyers can’t buy, and catalogue publishers can’t publish if this continues!

It's Time to Stop Just Complaining

I believe I can say that I know the publishers of both of the Australian coin and note price guides well enough to discuss this situation candidly and with respect - the reason I’ve come to the point of “going public” about this is because, as I've said, I’ve spent much of the past 6 months providing written valuations and talking to buyers and sellers about this issue ad nauseum. I believe it’s high time we all did something about it, rather than just complain.

This hasn’t always been the case of course - for many years, the catalogues were essential and accurate guides to where the market was at. Things sure have changed however, and I believe accuracy started to slide when segments of our market began to come off the boil about 6–7 years ago.

Few of us have the discipline to unfailingly acknowledge reality - I believe we need to though if we stand any chance of helping the market to truly recover.

Some market participants - collectors as well as dealers, are concerned that if prices in the guides do come back, then it’s going to crash the market. While I appreciate we can’t be cavalier about any changes that are made, this type of concern by itself doesn’t do anything constructive at all to repair the markets we’re all active in.

Turning the Market Around

And this is where I believe the price guides play a role in turning the markets around - their role is to let collectors know the reality of the market - that there is price volatility in certain segments, and that values have come off in other segments, in some cases quite drastically.

If values in the price guides are brought into line with where the market is now, I’d be naive and foolish to think that the next phase of the market’s cycle will pass without conflict, angst or upset. Despite the distress that is surely to come for many when reality finally sets in, I see no other path forward at all.

Until we get a new generation of buyers into the market, prices simply can’t recover. New buyers won’t enter the market until they see value, and they won’t know there’s value to be had if the books don’t reflect what items are currently trading for!

And so this is (finally) where we come to the purpose of a series of articles that I’ll publish in the coming weeks.

Shining A Light

What I intend to do is to start a discussion about each major section of these books - to compare values between 2014 and 2013, to compare the Rennik’s guide with the McDonald guide, and to start to shine a light on which values might change so more people can agree that the figures included are indeed a reasonable guide.

So, just what is a reasonable guide? For the record, I believe the definition of market value that should be used by these catalogues is the following:

“The amount that an item is likely to change hands for, between a willing buyer and a willing seller, where both parties act knowledgeably, prudently and without compulsion.”

I’ll be the first to admit that this is a long-winded definition, however it gets to the heart of the matter at the moment - collectors want market values that are reasonably likely to apply when it comes time to sell, and not just when they're buying. We certainly don’t have them at the moment.

Collectors don’t want to know to the cent how much they’re going to get from a dealer when they sell, but what they don’t want is for a dealer to say “Even though the book says $55,000, the last three that have turned up at auction have made between $4,000 and $8,000.” In my experience, a reasonable collector that’s aware of the market will generally understand why a dealer might offer anywhere between $4,000 and $11,000 on an item that has a catalogue value of $12,500, however they won’t cop those figures for an item that has a book value of $55,000.

Let Me Know What You Think

I’d love to hear what your thoughts are about the price guides at the moment - do you think they need updating?

Where?

By how much?

What information would you like me to cover in my reviews to bring you up to speed?

Do you think the definition of market value that I’ve outlined above is useful, or should we be looking at something different?

Feel free to leave any feedback in the comments section below.

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Comments (4)

Comments

I overheard one auction manager several years ago state that price guides were the worst thing to have happened in the industry. That was probably an overstatement however and probably a reflection of unrealistic vendor expectations.
It seems strange to me that a 'pocket guide' contains over 540 pages of information. I'd like to see most of the Perth Mint and RAM products dropped from the catalog or, at the very least, heavily condensed and consigned to back of the book. I also don't think there needs to be a picture of every decimal commemorative coin that's been minted.
It seems, however, that the main contention is pricing. I do think some of the prices are seriously over-stated: really, does anyone buy/sell 1933/2 overdate pennies for $175 in VF? I do sometimes wonder if the catalog prices are inflated so that collectors will think they are getting a bargain when the buy, say, 25% below the published price. It reminds me of a rug shop in Geelong that was always having a sale with 80% off. I'd be more in favour of a published price range however this might be overcomplicating things.
With regard to TPG, I'm slowly coming around to this for the top end coins at least. I've been researching prices for several months now (the catalogs will eventually need to cater for this as well). While TPGs bring a degree of objectivity when it comes to grading, that's not necessarily the case when it comes to pricing. As an example, the 1947 Perth Penny in MS63BN has ranged from $171 to $602 over the last 12 months. And 1912 Halfpenny in MS64RD has ranged from $420 to $900. Not to mention the astronomical prices for premium common dates: 1963 halfpenny in MS66RB for $5550, 1942Y halfpenny in MS65BN for $15500. There's many factors involved, of course, and TPG is still in its infancy here. But I can't help think that there will be some fingers burned here as well.
That would probably erode confidence as well, but not as a result of the price guide. Ultimately the price guide needs to reflect the market however this market is subject to volatility.

- Ben McDonald

Nice article Andrew... this is the first year since I started in coins and banknotes, that I have not bought a price guide.. and I've been buying or been given both since 2000... I reckon, I'm either going to open it and frown in disgust or be peeved off that I've spent $30 on what they believe prices are, unrealistic. From now on, I am buying on what I think something is truly worth, not referring to guides for now. I still have full confidence in the market and the hobby, it just has to move forward and evolve somehow....

- Kim B

An excellent idea Andrew, efficient markets need full information. Perhaps your definition needs to address the difference between dealers' buy and sell prices, which obviously can be significantly different.

- Ian Todd

I couldn’t agree more, and something has to give sooner or later. About ten years ago I attended an IAG auction on the Gold Coast, where each time a high priced note was knocked down a room full of bidders would erupt into ecstatic applause. I remember thinking at the time this sort of nonsense can’t go on and thank Christ I’m not into notes. The coin market has also failed to keep pace with the unrealistic values quoted in the two local price bibles, but I think they’ve done better than notes.
I think there are a few issues that need addressing other than price structure. I believe the subjects of inclusion and accurate transfer of information are very important for the hobby to encourage new participants and so prosper.
When it comes to pre decimal coinage the information at times borders on misinformation, take the 1920 penny plain for example. This coin is usually quoted at around $400 in VF, and guess what, this is the price parroted by many major dealers. This coin may be worth that amount if it was the London obverse variety, let’s get real. And herein lies the problem, extremely poor attention to a side of the hobby where I truly believe many players have missed the boat. There are many very important varieties within our pre decimal coinage, unfortunately the lack of information or should I say glaring omissions from the listings of both local price guide publications will only serve to hinder new entrants into the fast growing area of varieties. Both publications have made half hearted and half baked attempts to offer some lip service in the area of varieties as evidenced by their incomplete and as mentioned previously, misleading listings.
If those at the pointy end can’t or just simply refuse to get it right, they should get out.
I’m not suggesting coins sporting all manner of lumps, bumps, cracks and cuds be included in the main listings, they already have a place of their own and are keenly sort by collectors. But I do say that coins such as the 1919 double dot penny, 1920 London obverse penny with dot above lower scroll, any 1920 London obverse penny, 1920 Indian penny with dot over top scroll, 1920 double dot penny, 1921 London penny, 1922 various date width pennies, 1924 and 1927 Indian pennies, 1931 dropped 1 Indian penny, 1933/32 overdate penny, 1943 Indian penny with long reverse denticles, 1952 various date numeral pennies, 1953 Melbourne penny with different 5 and 3 as well as 1955y. and 1956y. mule pennies, just to name a few, should most certainly be included in any official listing of pre decimal coinage.
The coins mentioned aren’t the result of mint sport as many of the high priced modern day varieties are, instead they are from a time when various die combinations, some exhibiting differing characteristics to those more commonly in use, were knowingly or unknowingly used to produce smaller mintages. Over time their numbers have depleted, particularly in higher grade and they occupy a very important place in Australia’s numismatic history, but unfortunately, are being ignored by those who could make a positive difference.
I find it ironic that the world leader in third party grading, an entity that so often is the target of criticism from local sources, has begun to increasingly include many of these important varieties, while the local publications continue to not give proper acknowledgment.

- Ray Dillon