QUESTION: I read that the Heritage auction of the penny they said would bring $1.7 million was a flop. Any indication as to why? Or is it just the firm trying to pawn something for big bucks?

HK

ANSWER: I have no idea why Heritage would have claimed the coin would bring $1.7 million. It is not that rare. There are about 40 to 45 known 1943 copper cents from the Philadelphia Mint. The general assumption is that they were struck by accident when there were some copper blank planchets still remaining in the press hopper when production began on the new steel pennies.

Now as far as sales go, there was a 1943 copper cent which was first offered for sale back in 1958, which sold for more than $40,000, or so it was claimed. Subsequently, there was one sold for only $10,000 at an ANA convention in 1981. The highest amount ever paid for this error previously was $82,500 back in 1996.

There was only one copper 1943 penny known from the Denver Mint which did sell they claim for $1.7 million by Legend Numismatics of Lincroft, New Jersey. I would not guarantee that price personally. US coins tend to get really hyped. This unique coin, not publicly known to exist until 1979, was certified PCGS MS64BN. If Heritage was claiming their penny should bring $1.7 million which was from the far more common hoard of Philadelphia, I really question such expertise. The Heritage example sold for only $204,000, which is a modest advance over the last sale of $82,500 back in 1996.

The culture in American coins is strikingly different. American collectors seem to prize errors. A brockage is an error coin where one side is normal, but the other side instead of the reverse displays the obverse again, but incuse or in a negative mirror-like form. Brockage errors are caused when an already minted coin sticks to the coin die and impresses onto another blank pressing a mirror image of the other coin into the blank.

Brockage errors coins are rare. However, they do not bring significant premiums. A nice Augustus(27BC-14AD) denarius may bring $1,000+ whereas the Brokage will bring about $500 as illustrated above. Here is an extremely rare official Roman die of Emperor Tiberius (14-37AD) with precisely this problem of a silver denarius stuck to the reverse die.

This die of Tiberius is UNIQUE and was discarded because of the brokage error coins it would have produced which would have appeared like the Augustus denarius illustrated above. There are only about 12 official Roman dies that have survived.

Here is Another genuine Roman die of an extremely rare Emperor Gordian I (238AD) who reigned for only 21 days. Obviously, this die was discarded because he did not last in office very long.

There is a completely different culture outside of American coins. Such an error would never bring such premiums. In ancient coins, the premiums attained are for high quality.

QUESTION: Marty,
Back in 2015 when they closed the Chicago MERC after 167 years, you did a piece about how flashing screens do not provide the same “feel” as tape watching and floor trading. You also mentioned in that piece that “after Socrates, you will recreate something you always wanted to do” in relation to bringing “feel” back into trading.
My question is; given all the directions you are being pulled- is this still something you aspire to undertake?
I grew up tape watching, and despise blinking screens…it’s a lost art and would welcome anything you might undertake in this area.
Rw

ANSWER: Absolutely. We are getting ready for the first launch very soon. The intention is to expand the system to intraday. We are in negotiations with a data-provider to make the system live intraday with reversals and timing on an hourly basis. Trust me. It has been this initial launch that has been delayed by banks changing rules causing us to have to re-write the payment systems three times. Then we have completely different rules for outside North America so it required then setting up another whole new payment system. Then we have been having to set up yet a third for China. This has all been driven by this Hunt for Taxes.

It will be that intraday version that will be sound. Also in Phase-Two of our launch, we will be looking at providing a download version that will link back into our system so you can just talk to it and it will answer. We just cannot do that level of sophistication over the internet.

QUESTION: What about what China did by buying stocks a few years ago to stop the hang sang from dropping

ANSWER: Do not confuse attempts to support a market from actually being able to do so. This is the same as Keynesian economics that government could prevent recessions. Larry Summers admitted the government cannot even forecast such events. Not only during the Great Depression did companies jump in to buy their shares during the crash to try to prevent the decline. Most of the companies that took that action actually failed for they bought the stock back trying to hold the price and lost needed cash reserves. They could not sell stock again nor could the borrow.

During the collapse of the Nikkei after 1989, companies held believing that the government would support the market. When they realized the government could not then the government encouraged us to bail out the Japanese corporations. We helped well over 300 public companies issuing a note to buy their portfolios at their cost with 10-year payouts and each note had to be approved by the Japanese government individually. If the governments were able to actually prevent declines, then they would. But nobody can do that for the size of the public at large far outweighs any institution, group of institutions, or banks.

People would rather believe in conspiracy theories than simply look at the reality. Attempts to manipulate markets ALWAYS fail because the majority is far greater than any minority. The trend is made by the MAJORITY. A panic sell-off like the Crash of 1987 took place BECAUSE there was no bid – not that there was a massive short position. Scare the MAJORITY and they then try to sell, you find no bid and that is how a flash crash unfolds. This is why outlawing short positions is destructive for the only person with the courage to try to catch a falling knife is the one who is taking profit – not initiating a long position.