Thursday, August 9, 2012
Rare World and Ancient Coins for the middle class
Most Americans collect US coins. There are plenty of Americans who feel comfortable dropping $15,000 on a Lincoln Penny from the 20th Century if it has the right grade and markings. Many of these same people would think you were out of your mind to spend the same amount on a gold stater of King Croesus of Lydia dating to 545 BC - the first gold coin (see above.)
The reason for this is simple. Most Americans know who Lincoln was. But they have never heard of Croesus of Lydia. If you know who Croesus of Lydia is, you already have a tremendous advantage in collecting/investing in Ancients. If you know who Charlemagne - or Irene - or Basil Bugarokthonos was and why they were such a significant figures, you probably have a huge advantage in collecting late Byzantine era coinage. If your know what Kthonos means you're even farther ahead of the game.
My point is simple: Collecting coins - especially Ancients - is all about collecting Historically Significant objects. Understanding precisely why an object is historically significant is half the battle in valuing it.
Many people don't realize that for a person to be Historical, there needs to be a Contemporary reference to that person. Often the only extant contemporary reference is a coin or some other archeological artifact. For example King Solomon is an historical figure because we've found objects dating to the first temple bearing his name. Kind David is not an historical figure. Neither is Moses. It doesn't mean they didn't exist. It just means there's no objective proof of their existence. In coinage, for example, we know that Simon Bar Kosiba existed precisely because he is named on coins. For many years coins bearing his name sold for very little. But some people accurately figured out this these coins would appreciate because the rebellion he led against Rome led to the Diaspora.
Understanding the precise historical significance of a coin goes a long way towards forming a valuable and interesting collection. Especially in high grade. And especially when few other coins of a particular type exist.
And knowing about the history of Coinage (Numismatics) is also a great advantage, because some coins are valuable precisely because they are numismaticaly important: For example: collectors prize coins that bear important images that are later repeated down through history: The first image of Christ on a coin. The first reference to Christ on a coin. The first image of the Lamb of God, the first Franc-a-cheval. These are all prized by collectors
It's a knowledge game. Those who are willing and able to learn can do well. It's always wise to collect what you know. The more you know, the bigger your advantage.
With Modern World coins it's also a knowledge game. But there you need to understand which economies are thriving. Which are growing. Which are declining. Because growing thriving economies tend to produce a wealthy middle class which tends to collect high grade coins - especially gold - that celebrate their own country and culture.
This is why we've seen a boom in Russian, then East European, then Chinese, and now Indian coinage. What's next? And which economies are failing and thus likely to produce a decline in the price of their coinage?
I have my ideas. But that would spoil it for you. The whole fun of this game is to analyze and figure it out for yourself. That will give you a great advantage in collecting/investing in World Coins.