The really big news of the last 30 days has been the Saddle Ridge Hoard. If you have read, watched, or listened to any form of media then it would have been impossible to not hear about this one. Long story short, a couple was walking their dog and found ten million dollars worth of rare gold coins.
A couple of other stories you might have missed are below:
Faberge Egg Find – A scrap metal dealer finds a Faberge egg that is worth 33 million dollars. Stories like this always upset me. I am mostly jealous that I am not the person getting the windfall of cash. Many other times I feel like we are only getting a half truth. Maybe I am too pessimistic, but I feel like it is much more likely that the egg has a sketchy back-story and to clear some of that history it was “lost” and “found” by a third party. I just don’t understand how someone could lose track of something so valuable. This isn’t like a coin or a banknote that might take 100 years to be collectible. A Faberge egg has been a rarity and extremely valuable since the day it was made. I also don’t understand why the people who owned it before the scrap dealer would have been ready to sell it for melt without doing a moderate amount of research.
Pawn Stars Melt Job – Now this story is much more believable. A man’s niece slowly stole his coin collection and sold it to Pawn Stars. Sadly, stuff like this happens all the time. People don’t properly protect their collection and it is stolen. I usually hear about stuff like this happening after a house party or as the result of a traditional robbery. It takes an especially sick person to slowly steal a family member’s belongings. The two things I don’t believe about this story is that the collection was actually worth $50,000 or that it was actually melted by The Pawn Stars shop. Collectors are notorious for overvaluing their personal collections. The really hard to believe concept is that a pawn shop would melt down coins for the precious metal content. What is more valuable, a coin that is easily recognizable, collectible, and interesting, or a mass of metal? Yes, you could make the metal more pure if you melt, but you would ultimately lose value. Odds are that they just flipped the collection for a tidy profit.
Two Auction Houses Stop Paying Consignors
Stories like this are very scary. When I first graduated from college I started working for a bank. Literally once a month we had auditors in there. We had our own auditors, there were state auditors, and OCC auditors. For every five minutes I worked for the bank I spent another minute making reports for the auditors. I asked our CFO why we were constantly under review and he answered the question perfectly. If a landscaper is bad at his job and runs out of money then he has to quit and find a new way to make money. If a bank is bad at what it does then it has access to hundreds of millions of dollars to make it look like it is in a better position than it is. It is amazing to me that auction houses are not under more scrutiny. Auction houses have access to millions of dollars worth of inventory for months at a time. I am honestly surprised that we don’t hear about cases like the two below more often.
Manions Auctions – When I first started collecting, if you had militaria items then you likely sold through Manions. At one point they claimed to have the largest inventory and most sales of any auction house. Just take a few minutes and read through the list of complaints. The auction house owners started taking consignments, selling them, and keeping all of the money!
Ivey-Selkirk Auctions – I just recently learned about their problems and I was absolutely shocked. Again, when I first started collecting, Ivey-Selkirk was a huge name. They owned the St. Louis market and were probably a top ten auctioneer in the country in terms of size and scope. Now I am reading that half the staff has quit and consignors aren’t getting paid.
What is shocking about both auction failures is that the odds are already stacked in the auction house’s favor. They have 60 days after the auction to pay you. On average they probably make 30% on the sale. And these are (were) reputable long standing firms with a great buyer and seller customer base. It just makes you wonder what went wrong.