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Message from Modern Coin Mart on the 5 OUNCE F.U.B.A.R.
Dear ModernCoinMart Customer,
Where do I start?
There has been an avalanche of publicity and controversy concerning the release of the National Parks 5 Ounce Silver “Bullion” Coins. Because of this, and because we have been unable to launch pre-sales up until now, I thought it would be appropriate to comment. Many of you have been asking us when we will have them and what the pricing structure will be. I have been very uncomfortable with the situation because as the largest online retailer of certified modern coins your expectations of us are very high and the last thing we want to do is to offer a product and then withdraw it, or change the rules concerning purchase and pricing dramatically.
I was immediately disappointed when I found out that the mintage for each coin would be 33,000 vs. the original estimate of 100,000. I thought that even at 100,000 the coins would command premiums on the secondary market well in excess of normal bullion mark ups. There was no doubt in my mind that with a mintage of 33,000 per coin these coins would not be treated as “bullion” in the marketplace. Adding to the quandary was the fact that the U.S. Mint has not been doing a very good job of giving distributors and secondary marketplace market makers like ourselves enough advance notice of specific information that is required for dealers like MCM and others to market the coins properly and in an orderly fashion. I am not trying to slam the U.S. Mint here or anyone for that matter, in fact the U.S. Mint does many things very well but it must be noted where nearly everyone is in agreement of their deficiencies. As a footnote, we are a very big customer of the U.S. Mint, both directly and indirectly, but we have yet to apply for distributorship.
We are doing our best to obtain the product and while some of our orders to purchase have been cancelled or are in limbo, we are certain that as long as the U.S. Mint ships we will have the coins to sell. The reality is that while the mint can determine mintages and initial pricing, they do not represent the larger marketplace that ultimately sets the prices based on supply and demand. At ModernCoinMart, we take many different factors into consideration to arrive at what we believe is a fair market retail price for the items we sell. One of these factors is obviously cost, but the ability to obtain additional product and the demand for the product are even more important. Competitor pricing is also a big factor. I expect many of you to experience “sticker shock” when we do offer these for sale but I hope by communicating with you in advance you will understand the intention is not to gouge customers but to simply have the product for those that wish to obtain it.
Our intention was to offer the coins both uncertified and certified and we had planned on obtaining a minimum of 1500 of each coin. This won’t happen. Because we will only get a fraction of what we wanted and will pay way, way, over the U.S. Mint selling price to distributors, it is likely that we will only be able to offer the coins certified but this is yet to be determined. Rather than being first to market with these we believe it prudent to take a conservative approach in allowing the smoke to clear first. Until the professional numismatic community can source coins in a manner that affords us appropriate, required, and reliable advance notice, we suspect a certain element of chaos will continue to exist with some products that can make markets somewhat disorderly. We will continue to do our best to offset this by acting with caution and in a manner that we believe will allow us to meet or exceed your expectations.
Sincerely,
John Maben
President & CEO
JMRC/ ModernCoinMart
5565 Broadcast Court
Sarasota, FL 34240
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Originally Posted by ToBeSelfEvident
