Van Simmons - “The Rare Coin Market Can Go Up Dramatically, Quickly" | #48

Episode Summary

Executive Summary: Meb Faber interviews rare-coin expert Van Simmons about how coin collecting became an investable market through professional grading, certification, and liquidity. They discuss coin categories, demographics, counterfeits, international demand—especially China—and how collectibles should be approached as history, rarity, and quality rather than speculation.

Main Topics: Origins in Coin Collecting and Career Path (Priority: 4/5): Simmons explains how childhood collecting, family encouragement, and early fascination with history and precious metals led him into the rare-coin business and eventually to a long partnership with David Hall. How Grading Professionalized the Coin Market (Priority: 5/5): He describes how PCGS was created to solve the Wild West problem of inconsistent grading, establish guarantees, reduce spreads, and create a more trustworthy and liquid market for rare coins. Coin Categories, Quality, and Portfolio Construction (Priority: 5/5): Simmons breaks the market into major segments such as silver dollars, type coins, U.S. gold, commemoratives, and modern classics, then explains how higher-grade, eye-appeal-focused coins often offer the best long-term opportunity. Demographics, Demand, and International Growth (Priority: 4/5): The discussion covers who buys coins today, with a core client base in their 50s and 60s but growing younger interest and major overseas demand, especially from China, where certified modern coins have taken off. Counterfeiting and Trust (Priority: 5/5): Simmons warns that counterfeits remain a major risk, especially through informal or internet channels, and stresses buying certified coins from reputable dealers. Collectibles as History and Cross-Generational Stores of Value (Priority: 4/5): The conversation broadens to baseball cards, knives, art, pottery, and Indian artifacts, with Simmons arguing that the best collectibles are those that mattered in one generation and still matter in the next. Technology, AI, and Grading (Priority: 3/5): He explains that computer-assisted coin grading was technically possible but rejected by the collector community because human judgment and emotion remain central to the category.

Key Arguments: Professional grading transformed coins from an opaque, dealer-driven market into a more efficient and trusted asset class. High-quality, certified coins with strong eye appeal are easier to trade and are more likely to hold demand over time. Coin collecting is best understood as collecting history, not just seeking short-term returns. The biggest mistakes are buying too fast, buying marginal material, and trusting unreliable sellers. Counterfeiting is a real and persistent threat, making certification essential. International capital controls and rising wealth in China have created powerful new demand for certain coin categories. The best collectibles tend to be things that were important decades ago and still have appeal to the next generation.

Data Points: PCGS authorized dealers: about 1,400 - Global dealer network mentioned by Simmons PCGS market position: public company trading on NASDAQ - He notes PCGS is no longer privately owned Coins graded: over 30 million - Referenced when discussing the scale of certification Grading scale: 1 to 70 - Standard coin grading scale described in the interview Mint-state threshold: 60+ - Coins at 60 or above are considered mint-state/brilliant uncirculated Collectibility threshold: 65 - MS65 described as a magic number for many post-1850 coins PCGS weekly and monthly profitability: in the black first week and first month - He says PCGS was profitable almost immediately after opening in 1986 Chinese show grading volume: 6,000 coins then 11,000-12,000, later 58,000 coins - Illustrates explosive demand in China at successive shows Bank submission volume in China: 200,000 coins - A banker brought 200,000 coins to be graded Contracted Chinese volume: 300,000 coins per quarter - One client guaranteed this grading flow Common market split suggestion: 30% to 50% silver / 40% to 50% gold - Suggested rough allocation for a collectible coin portfolio Chinese silver dollars value example: $600 and $900 purchase; later sold for $25,000 and $45,000 - Late-1990s purchases that appreciated sharply during the China bull market Milestone coin rarity: only five known 1913 Liberty Nickels - Example of a several-million-dollar rarity 1907 high relief mintage: about 11,200-11,300 - He cites this as a key blue-chip coin 1907 high relief value: about $50,000 in MS65 - Approximate value given for a collectible example 1907 high relief market comparison: one of the main coin-market staples - Used as a blue-chip example analogous to a major stock $1804 silver dollar sale: about $4.1 million - Story of a coin recovered from a cabinet and sold at auction 1933 double eagle sale: $9-$10 million - Cited as one of the highest-profile coin sales 1794 silver dollar sale: $10-$12 million - Referenced as a recent major auction result 1952 Topps Mickey Mantle card value: about $5 million in a PSA 10 - Used to illustrate collectible “difference-making” items Vintage card market growth: $1,200-$1,300 to $121,000 - A Mantle card Simmons bought and later sold through auction Old rare coin market share: 70% make money, 15% lose, 15% break even - His rough experience buying and selling older high-quality coins

Pivotal Quotes: "It’s kind of the last bastion of free enterprise." — Van Simmons: Describing the rare coin business and coin shows "We tried to make a level playing field for people." — Van Simmons: Explaining why grading guarantees and certification changed the market "If you want to understand collectibles, stop thinking of them as investments and start thinking of them as history." — Van Simmons: Core philosophy for evaluating collectibles and rare coins

Implications: For listeners, the episode shows that rare coins can function as a trust-based, historically grounded collectible asset class. Success depends on certification, quality, patience, and dealer credibility, with new demand increasingly shaped by global wealth flows and cultural collecting trends.