Moral Hazards and Dealers

[Robarons]

One of my favorite pastimes recently is to hit dealers that may have not updated their prices with the current rise in silver. Most dealers have done a decent job in doing so, but foreign stuff does not seem to be paid attention to and with different purities, dealers either dont know or dont care.

I have been able to hit 90% at 15-18x face at antique stores and some great deals for foreign silver. But by now most dealers have gotten with it. What is your feelings on this topic. Like at a coin shop I found a proof 1964 quarter clearly marked $4. I informed him and he quickly took it out. But he would have honored it if I would have pressed him. I mean if you have been dealer for XX years, with a store front, with $1400 krugers and $500 Carson city dollars staring back at me is it your job too tell them or take the money and run.

As an example at a coin show today I bought these from a dealer who has been then there for at least 10 years:
1960 Canadian Dollar $7
1964 Canadian dollar $16
1890 Morgan Dollar $20
1922 Peace dollar $16
1935-S Morgan $18
and two barber halves for $8 each
He honored the prices- but would you feel bad? Would you have told him and walked off? It goes to show no one was looking at his stuff anyways- he couldnt even sell a $7 Canadian dollar!

(there was about 15 dealers at this show as well BUYING morgans for $20 each, 90%, etc.)

This was at 1 pm, 3 hours after the show opened. It goes to show in a place like Michigan ppl dont look or cant afford deals. Found a butt load of 92.5% Can Dimes for $1.50 each. Went to a local coin shop afterwards and found 1960 Mint sets of Canadian Coin ($1.85 Face of 80%) for 12x. The dealer first said they were put out 'last week' and when I got them out of his case to buy them he looked and said 'looks like these are priced under melt- you arent supposed to buy these!' but he honored it anyways, even thought silver was likely $27-30 last week and does not warrant 12x anyways.

So what is your feeling on the topic? Rob them blind, tell them, please share!

[AGgressive Metal]

A price tag is not an offer to sell or a contract in and of itself, so they always have the option of saying "sorry, I need to update this". I always just come to the counter with what I want to buy and leave it up to them to either ring me up or tell me they won't sell at that price. If someone is in business for many years then they know what they need to get out of certain coins.

The morality is different with people who aren't professionals - then I think its important to not rip anyone off. If some grandma offers Morgan dollars to you at a yard sale for $5 a piece, I say you pony up and pay something more fair.

[Robarons]

Yes you are correct. The goal is not to rip off Grandma or the general public. The idea is that dealers who have been in the business for a while tend do these things.

The mart dealers in my area post signs that prices may change due to market conditions or post on the their binders all US silver is 20x min. or whatever.


Its very surprising on what I am able to find and how the dealers let it go. Its not good to burn bridges but most of the time they do not take hard feelings from it. Also its odd for a person like me is the only the person to spot this, not even the dealer noticed. Its typical to glare over certain dealers that you seen before but it pays to keep an close eye on them.

[uthminsta]

One of my good friends owns the shop I frequent. I asked him about it as I was pulling a bunch of US silver stuff from his bargain bin. He said they do fine to sell it at what it's marked, and they would have to spend all day searching through all their inventory, changing stuff to make an extra FEW dollars. They said it's just not worth the time, and they have a lot of guys who come in and do exactly the same thing every time silver goes up - they buy what has fallen below melt.

[Market Harmony]

I stopped putting price tags on coins after October when melt value outpaced numismatic premiums. I'll happily quote a price to anyone that requests it. If someone looks at a coin but doesn't ask a price, then they weren't really interested in it in the first place. But people would be surprised in the prices that I'd be willing to depart with some things.

As for the question at hand... buy them up. Make the dealer pay for his laziness or mistake. If it garners hard feelings, then the dealer is looking at you as the problem and not himself. As a buyer, If I get quoted a price or see one marked below at at the price I want to pay, and the dealer sells it to me, then at least I am happy. He's in business to make money, so if it is marked at a certain price, then I'm sure he is profiting on the deal... just maybe not as much as he could have.

As another member pointed out, it's obvious that nobody was interested in buying certain coins for a long time, so the numismatic value wasn't really true market value. They were junk and finally met their market value when silver overtook the premium. Dealer made money, buyer got a deal... everyone should be happy.

I don't see this as a question of ethics as both parties should be considered to be informed market participants.

[Lemon Thrower]

the antique shops around where i live want 3X a fair price for anything they have, so silver would have to go to $100 before you could get things at a discount. i'm sure they rip off grandma every chance they get.

[Cptindy]

Interesting Topic!

[frugalcanuck]

I agree with not ripping off Grandma or Grandpa but if the dealer has something priced at 12 X FV it means they payed much less than 12 X FV when they bought it. If anyone ever tried selling to the dealer they generally wont / cant pay market price or they wont beable to stay in business.