Monday, February 02, 2009

2008: A Difficult Year

2008 was a difficult year during which several adverse developments occurred.

The development affecting most people worldwide was a major economic crisis that began with the collapse of overinflated US housing and credit markets. This soon spread to every other nation participating to a significant extent in the global economy, and today even China is experiencing its effects. The crisis is still upon us, and it is not clear what its ultimate depth will be or when a recovery will take place.

Developments in 2008 affecting coin collecting involved continued progress of cultural nationalists and radical archaeologists toward their long term goal of eliminating private collecting of “cultural property.” Their most notable success came when the German government gave in to demands that importation of unprovenanced “cultural objects” (including coins) should be prohibited as part of Germany’s implementation of the 1970 UNESCO Convention. More will be said about the effects of this legislative change in a subsequent post.

Classical Coins had a very difficult time during the last half of 2008, originating in the outbreak of an intense and dangerous wildfire in the mountains above Goleta. Although this fire did not spread into the city, it was burning under high voltage power lines supplying electricity to southern Santa Barbara County. Innumerable power outages resulted, and our offices had to be shut down for two weeks. The effects of this setback affected everything afterward, including the holiday season during which we were so administratively stressed that orders could not be shipped as fast as they came in.

Despite all these difficulties, there was one significant favorable development: the market for collectibles, including ancient coins, prospered during 2008. When other investment alternatives are devalued, collectibles tend to do well. Ancient coins in particular have proven to be very stable and reliable long term investments, retaining their value despite all the vagaries of transient political and economic trends.

One ironic thought: In opposing the goals of anticollecting extremists, I am in reality working to limit the appreciation of my own very substantial investment in ancient coins. Should the trade in ancient coins ultimately be constrained as anticollecting extremists desire, an inventory of ancient coins acquired before that sad event happens will become much more valuable. The value of my inventory would probably double. Although those who relentlessly campaign against coin collecting strive to portray numismatic professionals as greedy exploiters, nothing could possibly be further from the actual truth.

Being a dealer in ancient coins is a labor of love - very few if any of those involved in it would fail to make significantly more money doing something else. I can make twice as much per hour as a consulting engineer. It is certainly relevant to consider how many archaeologists, museum curators, cultural ministry officials and other anticollecting activists could expect to do as well were their present occupations no longer available.


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