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?
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.