Unveiling the Contours of Indulgent Success

Focus: Ultra Rarity and World Class Portfolio Selections

What does a naked woman reclining on canvas have to do with asset growth and return on investment, and, beyond art,  does she illustrate any correlation to the growth in value of rare coins? An ecstatic “Yes!” would be in order here.

I’ll paint that picture. The date: November 9, 2015. The place: New York City. The scene: a major international art auction. For one work, the bidding began at $75 million. Within seconds the bidding reached a frenzied state, and the numbers climbed to an astonishing $100 million.

Before the carousel of bidding was done the gavel nearly broke at more than $170 million. Painter Amedeo Modigliani’s “Nu Couche” (reclining nude) broke all records for the artist, besting the previous high by more than $100 million.

While the sales price was eye popping, it was only the second highest price paid for a major painting this year, as the art market witnessed a $300 million transaction months before for Paul Gauguin’s “When Will You Marry?”

While the sale of Modigliani’s reclining nude have been “lackluster” as compared to the Gauguin, still a whopping $500 million in art had sold, many works shattering previously held records. This happened, mind you, a mere five years after the great-recession.

While once unthinkable, the market now buzzes about the possibility that a single work of art will bring $1 billion, perhaps in the not too distant future. After all, we have crossed the half a billion mark already, with the sale of the last of Leonardo da Vinci’s works, Salvator Mundi, in 2017.

Similar things are happening in the world of numismatics, where I would argue that rarities have much greater room for growth as compared to fine art.

In this new economy where money is looking for places to land, more investors are finding the luxury index as that place to invest funds for the long-term. Art, cars, wine, watches and rare coins are demonstrating strong performance year-over-year and are becoming more appealing to investors looking for something more than paper.

The trend worldwide is toward legacy wealth – wealth with a story and a narrative. Evaluating the performance and key factors for rare coins, I believe they stand as the tallest asset in this high value tangible asset market. Rare coins of distinction have characteristics and benefits that other big dollar properties do not have and cannot offer, including higher levels of portability and privacy among others.

There is perhaps no better high-end collectible luxury asset class than fine art that has such a direct tie to what is happening at the top of the rare coin market.

Each year a similar record-breaking growth process is happening in numismatics. The thirst for singular, beautiful specimens in the rare coin market is growing in magnitude. However, unlike art, I believe numismatic rarities have much higher to climb. While the market is setting impressive new highs, the ascent is just under way on the journey to new rarified air.

For example, the now famous Pogue Collection is estimated to be worth somewhere north of $200 million. Collected by a father-son tandem who had a focus on quality and eye appeal, the original investment was a mere shadow of the collection’s current value.

With a passion for the most pristine execution and the most beautiful of artistically presented design elements – in particular the various forms of Lady Liberty depicted on the coinage – the Pogue family built astonishing legacy wealth that won indulgent success in terms of return on investment.

Dozens of new record breaking prices were realized in 2015 when the first of this remarkable collection was offered to the public – dozens of world record prices from one part of one collection!

These included three new records for early American half dollars, including $1.5 million for the 1797 issue, $587,500 for the 15-star variety of the 1796 issue – a $200,000 increase over its last sale, and the 16-star variety of that issue surpassed $800,000, more than doubling its former high. And these are just a few examples from this benchmark collection.

This is now the trend throughout many decades now in the numismatic world. These include the famous collections like those from noted collector-investors such as Louis Eliasberg, Max Mehl, Fred Olsen, King Farouk, John J. Pittman, Henry W. Bass, Emanuel Trompeter and many others.