Weekly Market Report: Rare Coins Remain Active as Nation Recovers from Terrorist Hijackings

It has only been a week since the United States experienced what is perhaps its greatest national tragedy. Now we are poised on the brink of war, devastated by the loss of thousands of fellow Americans, faced with a volatile stock market and an uncertain economy, and more unsure than ever about what the future holds. While everything has paled in significance to the events of September 11, the rare coin market is like the rest of America, momentarily staggered but far from down and out.

Several important auctions have been postponed, including two that were originally scheduled in New York City during the week of the tragedy. Coin shipments have been slowed considerably, and travel to coin shows is (and will continue to be) more of a hassle than ever. Even so, business continues with remarkable resilience and strength.

"The Internet activity is unusually strong," says James L. Halperin of Heritage Rare Coin Galleries in Dallas, Texas. "On Tuesday [the day of the terrorist hijackings] everyone wanted to buy gold. There were almost no sellers anywhere, so prices became somewhat volatile. By Wednesday activity had slowed down, but it has picked up each day since then."

Halperin, who has written two best-selling novels about the near future, was asked to peer into the crystal ball once more. "You can be sure that the Fed is going to do everything that it can to increase liquidity. That means inflation. You remember inflation, right? Well, it's coming back."

What else? "No one is going to be selling coins in order to buy stocks," Halperin continued, "but there is diversification the other way. People are selling at least some of their stock portfolio in order to get their money into something more solid."

So things are as busy as ever? "The Internet activity is as busy as ever, but I can't say about the other areas of the market. A lot of people are doing nothing. They're still in shock. It's also too soon to tell how these terrible events will affect the market in coming weeks and months, even years."

Halperin looked at other unsettling national events of the past and found no concrete pattern. "During and after the Gulf War the rare coin market was weak. Was this because of the war or just because coins were too high? It's hard to say, but it could be that both were important contributing factors.

"Now, go back to the hostage crisis [1979-81]. During that time coins quintupled in price. Did people fleeing to tangibles cause the rise, or was it really caused by the Hunt brothers trying to corner silver? Once again, the end result was probably due to a combination of events."

In the wake of recent happenings many near-term plans are tentative. "For now we are going ahead with our Long Beach auction," Halperin continued. "I say 'for now' because something else might happen to change that. We are also holding our CAA [Currency Auctions of America] sale in Cincinnati this week as originally scheduled (September 21-22)."

The Kingswood Coin Auctions "Franklin" Sale has been rescheduled, but fans of these extremely popular phone/fax/e-mail sales won't have to wait too much longer. The sale has been moved from October 11 to October 18, 2001. Auction lots will still be available for viewing at the Long Beach Coin & Collectibles Exposition in early October.

The "Tree Many Feathers" sale by Bowers & Merena Galleries is rescheduled for November 28, 2001, in Baltimore, Maryland. This outstanding auction will be back online on November 1.

This landmark sale was originally scheduled for September 14-15 in New York City.