Dandan's Comments on Chinese Coins

I have started posting translations of posts from a veteran coin/bank note dealer at the Lugong Market in Shanghai. The topics cover both precious metal coins and circulating coins. The author calls himself Dandan (Eggy), without giving his real identity, stating that his purpose is to educate new collectors/investors of Chinese coins, who have average budgets. His perspectives are well worth noting for those interested in Chinese coin collection and investment. He assigns a “collection index” and a “investment index” to the coin he discusses, which provide useful clues to those acquiring Chinese coins. 

(About Chinese circulating coins: apart from precious metal coins, the Chinese circulating coins are  nice investments, too, or even better investments than the former. As the post below shows, the Ningxia circulating commemorative coin, for example, is selling at around 1,000 yuan. In terms of percentage of growth, it beats most precious metal coins hands down, as it was available from the bank for 1 yuan when it was first issued in 1988. Circulating coins are ideal investments especially for those with a smaller budget.

Another advantage of circulating coin collection/investment is that they move in their own path, following the market law of supply and demand, unlike Chinese precious metal coins held hostage to the bullion prices of gold and silver, which in turn are heavily manipulated. Speculation does happen with circulating coins, especially when they are first issued, but price swings for coins issued before the 21 century are much less violent, leaving the investor with peace of mind. )

http://club.pchome.net/thread_1_15_6648665__.html

Commemorative Coins for the Five Autonomous Regions (Circulating Coins)

Here we are talking about Commemorative Coins for Tibet, Guangxi, Xinjiang, Inner Mongolia and Ningxia. Among these, Ningxia is the most expensive, and Inner Mongolia is the least expensive. Their pricing is directly dependent on their mintage. Ningxia has the lowest mintage, and so it is the most expensive. Inner Mongolia has the highest mintage, and so it is the cheapest. My favorites are Tibet and Xinjiang. The design of the Potala Palace on the Tibet coin is extremely exquisite, truly beautiful. The Harvest Scene on the Xinjiang coin is amazing, too. Moreover, the mintage is low. As the third commemorative circulating coin, it is only RMB 120-130 a piece now, good for both investment and collection. Great stuff, with big future upside potential, as long-term investment. The mintage of Inner Mongolia is too high. It would be fine to buy one for collection, but not for investment. It is the target for speculation and hyping. Ningxia is good for both investment and collection, but as it is priced over RMB1000, only speculators and buyers with a deep pocket can afford it. The problem with Guangxi is that the coins were packaged in soft paper, which absorbs moisture easily, making storage difficult. So I do not recommend it.

Collection Index：Ningxia 10, Tibet 10, Xinjiang 10, Guangxi 8, Inner Mongolia 6
Investment Index：Ningxia 7, Tibet 8, Xinjiang 10, Guangxi 6, Inner Mongolia 5

Ningxia

 Tibet

Xinjiang

Inner Mongolia

Guangxi

On "OMP" and "COAs" of Precious Metal Commemorative Coins

By Huang Ruiyong

Source: http://bbs.jibi.net/dispbbs.asp?boardid=212&Id=244038

First and foremost, judging from the trend and direction of coin collection, OMP and COAs are not of utmost importance to collectors. Let's see how foreign collectors view this issue. Milled coins made their first appearance in Europe and America, and were introduced to China only in the late Qing Dynasty. In the collection and research of milled coins, European and American collectors are far more advanced than we are. In Europe and in the US, collectors, connoisseurs and professional grading services treat lightly the OMP and COA of a coin. Instead the condition of the coin is the focus. A coin in excellent condition is hotly pursued even if it is raw. A coin in OMP with a COA will not sell at a higher price than a raw coin in the same condition.

Secondly, OMP of precious metal coins from the PRC is limited to certain historical periods. Many early coins did not have the so called OMP packaging, such as the 30^th Anniversary of the Founding of the PRC, the proof version of Year of the Child, the first set of the Bronze Age gold coins, and the International Year of Peace. Many BU Panda gold coins and large size coins and medals were simply sealed in a plastic pouch, such as the 1984 12oz gold Panda, the 1985 and 1986 Hong Kong Expo silver medals, and the 1986 Sun Yat-Sen 5oz silver coin. The so-called OMP came in fashion after the China Gold Coin Co. was founded in 1987. Our definition of OMP here is the coin sealed in a round capsule, which is in turn sealed in a plastic pouch. In recent years, many new commemorative coins followed the international trend, with a round capsule to protect the raw coin and no plastic pouches. A fixed number of coins are then placed directly into a rectangular or round coin plate, shown in pictures 1 and 2. We can conclude that the so-called OMP may well be the phenomenon for some specific periods in the history of precious metal coins and medals from the PRC. Nobody can tell whether coins released in the future will be sealed in plastic pouches.

Picture 1

 

Picture 2

 

Thirdly, does OMP really make sense? Many take the following as the advantage of OMP:

1.      If in OMP, the coin has never been cleaned.

2.      The vacuumed pouch can protect the coin from sulfuration or oxidation.

3.      Coins in OMP must be in perfect condition.

Are these true facts? Not necessarily! First, collectors or coin dealers can send early-year coins dipped in cleaning solutions to the mint for re-sealing if they know the mint well. That's why we find brand new external packaging on many coins issued years ago. Next, the plastic film used to seal coins is often made of polyethylene, PVC or polypropylene. Of these materials, polyethylene and polypropylene are harmless, but PVC is harmful. That means that coins sealed in PVC should have the plastic pouch removed. Besides, plastic pouches do not stay vacuumed or provide moisture protection. We often see early coins (such as lunars and Unicorns) with small bags of desiccant in the pouch, proving that the plastic pouch alone cannot isolate the coin from external air.

But the discussion above has not touched on the most crucial point. We may all have discovered that precious metal coins released in the last few years have a good fit with the round plastic capsule, and are well sealed. In the early years, however, the capsule did not close tightly. As a result, when we pick up the coin by holding the cover of the capsule, the bottom of the capsule may fall out with the coin. If there are no cushions or carpets underneath, it will be a disaster. Due to the loose fit of the cover of the plastic capsule, and also to the poor design of the capsules, many gem coins with high relief were damaged. Most frequent problems include the following: 1. Head rub, most often seen on 1987 and 1988 platinum Pandas, the 1989 palladium Panda, 1992 and 1993 1oz proof silver Pandas, 1994 5oz and 12oz Children at Play silver coins, 1990 Munich Expo gold and silver medals; 2. Nose rub, most often seen on 1990 BU and proof silver Pandas, 1993 1oz Sun Yat-Sen gold coin, 1993 Song Qingling silver coin (with signature); 3. Shoulder rub: 1989 Founding of the PRC gold coin; 4. Belly rub: 1984 Olympics Volleyball mirror and matte versions; 5. Bust rub: 1991 25^th Olympics Women Ping Pong Players. Many rare coins are not in good condition even though they are in OMP. The main culprit is the poor fit of the plastic capsule, which allows constant rubbing and bumping during transportation and results in serious damage of the coins.

Due to the subpar quality of the plastic capsules of our country, the capsules may have been shattered during frequent movement or long distance transportation, even if the coin is still in OMP. When this happens, the debris of the plastic capsule may roll around on the mirror field of the coin when we pick them up. If we run into coins in this condition, OMP should be removed without any hesitation. Otherwise the debris may scratch the mirror field of the coin.

The funny thing is that when we examine OMP coins from the Shanghai Mint or Shenyang Mint, we run into surprises from time to time, among which are seed shells or hair. Please see Picture 3.

Picture 3

Speaking from the perspective of a coin collector, many of the coins from earlier years do not have good plastic capsules, which need to be replaced by more professional plastic capsules or pouches, like in Picture 4. Generally speaking, capsules from Europe and the US have very good fit, especially those with black rings. It takes some effort to open the capsule once it is closed tightly. This will reduce the risk of the coin rubbing the plastic capsule during movement.

Picture 4

 

Next, we will talk about COAs. The so-called COAs for precious metal coins are nothing but a piece of paper with descriptions. As Mr. Ge Zukang said, a fake COA with a genuine coin does not falsify the coin, while a genuine COA with a fake coin does not turn the coin into a genuine one. Early COAs came in various forms. Even the paper used for printing COAs fell into different categories: Linen finished paper, card paper, coated paper… Only recently did COAs start to be printed on banknote paper with water marks.

Many coins were distributed by foreign companies, and the so called COAs were not printed by the People’s Bank of China. Instead, they were printed by foreign distributors, such as those for all the gold, silver and platinum Unicorn coins, Taiwan Scenery gold coin Set 1… The domestic COAs for such coins currently on the market were printed by Chinese dealers later on, but have been accepted by all. Besides, COAs for many coins were discarded by distributors in their business in early years, such as those for the Year of the Child silver and gold coins, the 1982 Soccer gold and silver coins, and the UN Decade of Women silver coin. We have gotten used to collecting these coins without COAs. As for the 8 gram lunar coins, the 1986 27 gram Sun Yat-Sen silver coin, the 1/2oz Three Kingdoms gold coins Set 1, 5oz gold Qi Baishi, the 1988 Woman Sword Dancer gold coin, their fake COAs are as good the genuine ones. Moreover, the fake COAs for the 12oz gold Snake, 1oz gold Dragon and the 1989 1oz silver Snake are better made than the genuine COAs. If the collector comes across the fake ones first and gains a false impression, he or she would throw out the genuine COAS later on. In this light, if undue emphasis is placed on the so-called COAs, those who are away from the Lugong and Madian Markets will get hurt most, because they do not have easy access to the physical coins, let alone catching the slight difference between fake and genuine COAs.

As King Chan once said, it would be more desirable to collect COAs as documents related to coins. COAs can still capture the heart of collectors for now primarily because the gold and silver coin and medal market is still a buyer’s market or a semi-buyer’s market. The COA is sometimes used as a tool for bargaining. Imagine that in the near future, if the precious metal coin market changes completely into a seller’s market, the COA will totally lose its function as a bargaining chip when a coin in perfect condition is madly chased by multiple collectors. At that time, finding a coin would be lucky enough. The collector may never see the coin again if he insists on COAs.

What COAs are worth collecting? Theoretically, it would be perfect if the coins we buy come with COAs or descriptions. But if there are no COAs at all, or coins with and without COAs have a big price gap, COAs are not an accessory we have to buy to feel happy about. The following COAs are well worth collecting: 1. Dunhuang Caves Discovery 100^th Anniversary silver coins are stored in a hard carton box in the shape of a 16k book. The COA is printed like a stamp mini-pane on 16k size paper, very pleasant to the eye; 2. The Founding of the PRC 20oz gold coin has its COA in the form of a magnetic card, very unusual and worth collecting, as in Picture 5; 3. COAs for the 1oz platinum and gold Snake and for the 1990 Dragon and Phoenix gold and silver coins were made into beautiful booklets, well worth collecting. In other words, if the COA of a coin is valuable both for artistic appreciation and for historical significance, it becomes an integral part of the culture of this coin. I suggest that collectors go for this type of COAs now. 

Picture 5

For beginners, please remember: “condition, condition, condition!” Condition is always the top concern for a coin. In addition to the coin, it would be great to collect anything that is valuable, such as COAs, posters, hand scrolls, designer’s drafts, plaster dies, steel dies, packaging from different distributors, phone cards, first day covers and jewelry. OMP should not be the focus, though. This way, we can make sure that we will not miss gem coins, and make steady progress on the journey of precious metal coin collection.

Transition to an Intermediate Collector

By Huang Ruiyong
Source: http://bbs.jibi.net/dispbbs.asp?boardid=91&Id=94372&page=2

In the previous lecture, we discussed the beginner's approach to collection. I stated that the following points are crucial to a beginner: coin affinity, logical reasoning, coin knowledge, awareness of gem coins, making friends and information symmetry. After stepping over the threshold to gold and silver coin collection, we find ourselves looking out to a brand new world. So, after passing through the beginner stage, how can we smoothly transition to an intermediate collector? Following are some key considerations.

First, we need to decide on the themes. Themes for coin collection are different from those of stamp collection. They can be based on different focal points. We all have limited time, cash and access to the market. As a result, only collecting around themes can enable us to reach an elevated level. For example, we can concentrate on the theme of grottos for our collection, because grottos were the supreme representative of ancient Chinese art of stone sculpture. When they are grafted to gold and silver coins through re-creation, they definitely give out a powerful visual impact. Another example: we can focus on piefort coins based on the theme of technology. So far very few piefort coins have been issued, and they are highly valued. They offer the collector a great opportunity to excel in collection. We can also collect 1/2oz gold coins based on the theme of size. This mainstream size has many gems to offer, too.

Only after the themes are decided on, can we overcome the asymmetry in location, information, market channels, cash and coin knowledge, and advance further in collection. In other words, collectors concentrating on themes will finally be viewed with esteem among coin collectors. Of course, themes should not be decided on blindly. We need to take into consideration our own circumstances. For those well-to-do financially, larger size gold and silver coins can be the target of collection, but even for those focusing on small silver coins, if you persist over a long period of time, you will still stand out, winning respect from fellow collectors.

Now that we have decided on our personal theme after serious thinking, what should we do next?

First, we have to be realistic about the timeline of collecting. Many people are totally overwhelmed when they first get to know gold and silver coins, and would not waste a single moment in their attempt to own the top gems. But cash alone cannot lead to sophisticated collection. Think about it. If collection can be purchased with money alone, then nobody can be better collectors than Bill Gates or Warren Buffet. In collection, we emphasize winning out in a marathon. So we need to adjust our expectations: Rome was not built in one day. In the same spirit, our own gem collection cannot be built over a few days. Moreover, the fun about collection is not just the end result, but more of the process. We search everywhere for the coin we desire, far and wide, exhausting ourselves in the process, but without the slightest regret. This searching process will deepen the heart-felt affinity you have towards the hard-to-find gem you finally lay your hand on. In other words, the fun of collecting does not come just from the ultimate ownership, but more from the searching process.

Now let's talk about the priority of collection. For beginners, the collection process is like taking the college entrance exam. They go from the easy parts to the difficult sections. Simply put, when collecting coins, they are more likely to start from the latest years and then trace back. But for intermediate collectors, they must break this conventional thinking, and go for the hard nuts (key dates), to secure better achievements in collection. Once the hard nuts are cracked, it all becomes galloping on a vast open terrain. Key dates are like tesuji in the go game. Once you have them, you have the flexibility of offense or defense. For example, once you have collected the 1982 gold Soccer, you don't have to worry about missing anything in the sports coin set. Take another example, if you have the first series of the Bronze Age gold coins, they will absolutely be admired by other collectors. Anyone who owns the key dates is best positioned for further gains. There is no doubt about it!

When intermediate collectors have had a clear sense of the timeline and priority of collection, they need to learn to give up. This is a critical tactic that distinguishes intermediate collectors from beginners. The old saying goes: nothing given, nothing gained. It is like playing the go game. In a go game, if you have two isolated groups of pieces under fierce attack, you have to make maneuvers to gain advantage. For intermediate collectors, the following motto has to be kept in mind all the time: lose a pawn to save a castle; lose a castle to save the king. Gem coins under the sun cannot be pocketed by any one person. Once we have learned to give up, we have made a solid step to becoming an intermediate collector. Learning to give and take is easier said than done. Wilde once said, "I can resist anything but temptation." For a collector, when presented with an eyeful of glittering gem coins and medals, which tantalize every nerve in the brain, the overwhelming temptation is hard to resist. But our pocket has a fixed size. So even if we cannot turn our back without a blink, we need to remind ourselves all the time of the principle of giving and taking.

In addition to the theme, timeline, priority and the tactic of giving up, the training process of an intermediate collector includes handling physical coins. This is of utmost importance, which should never be missed. It is because in any collection of artistic works, looking at catalogs and visiting websites only is far from enough. It is like a commander talking about stratagems on paper, who would have his army routed in the end. Only by touching physical coins can we appreciate the exquisiteness of many modern coins and medals. For example, by looking at the catalog alone, it is impossible to realize that the engravers of the 1983 1/3oz Marco Polo gold coin did such a great job in bringing out the profound and wise expression in his eyes, leaving the viewer with an everlasting impression. Another example is the 1989 Guanyin silver medal. If you do not see the actual medal, it is hard to imagine the benign and stately posture of the Buddha. Take one more example. The 1990 Eight Immortals Offering Gift silver medal has the God of Longevity on the obverse, and the eight immortals offering gifts on the reverse. The looks of each immortal are presented vividly before our eyes. The physical medal is simply gorgeous. In addition, some special technologies, such as piefort, coin alignment and coin edge lettering, can never be displayed on the catalog. Besides, for intermediate collectors to start appreciating more subtle features of a gem coin, such as high relief, multi-layer frosting, and line carving, catalogs have proved to be very inadequate. Of course, only the physical item can bring out the strikingly beautiful effect of various toning, such as plain toning and rainbow toning, which adds to the inherent charm of the gem coins. Such toning cannot be cloned by catalogs. Our ancestors said, "Read ten thousand volumes of books, and travel ten thousand miles." The implication is that whatever we learn from books is shallow. Real knowledge comes from physical action. In order to become more sophisticated in collection, intermediate collectors must constantly meet coin-collecting friends, observing, asking questions, and collecting data as much as they can. Remember: the treasured images of some rare gems exist only in our mind. Only on the occasion when a physical coin makes its rare appearance, are we swept away by the feeling of adrenalin being madly pumped into our system.

In the actual practice of collection, an intermediate collector must not overlook the most common category: the panda coins. A MCC collector will not be able to feel the powerful depth and breadth of modern Chinese coins without truly understanding panda coins. There are literally too many gems among panda coins, which include all the exceptional categories we can think of: piefort coins, coins with coin alignment, bi-metal coins, colored coins, palladium coins, platinum coins… Once we have a full understanding of panda coins, we will naturally be qualified to make our own judgment on other coins. It is like going to restaurants. Panda coins provide the chance for us to taste all types of food and their ingredients. Once we have experienced panda coins, we should feel at home with other coin families.

Intermediate collectors should not dismiss gold and silver medals from the PRC, because coins and medals share the same source. Many early medals were designed and issued specifically for seasoned foreign collectors and numismatists. These medals with very low mintage achieved a great feat when they passed their critical eyes. On foreign markets, gem medals have never lost to coins in their price. What medals should we focus on? We focus primarily on the "official medals." These "official medals" are those from institutes that can issue medals on international markets on behalf of the PRC, such as China Mint Company, China Gold Coins Co. and China Coins Limited. Of course, early medals (before 1997) from China Arts&Crafts Import and Export Corp, Shenyang Mint and Shanghai Mint are very outstanding, too. They qualify as "semi-official" medals. Many of the early medals are gems, such as the Hong Kong, ANA and Munich Expo medals, medals with religious themes, and vault protector medals. These are all top picks. Now they are still available now and then on the market. Knowledgeable collectors should pick them up and look after them with great care. In time, they will become treasure of the house.

Intermediate collectors should not limit their interest to coins only. They need to broaden their view, to include medals, which are offshoots from coins. Of course, we will only pick gems from medals, while rejecting the mediocre ones among them. Generally speaking, new technologies, such as slanted edge reeding, irregular shapes and latent engraving, are tested on medals first. So the study of medals will in turn advance our expertise in coin collection.

(The lecture has a section discussing price discovery, which is omitted from the same topic in Huang's book, for good reasons. It is too technical and confusing. I am omitting it here, too.)

To summarize this lecture, I believe that for anyone to shed the naivety of a beginner and transition to an intermediate collector, the following points need to be fully heeded:

1.    Focus on collection with themes;
2.    Establish an appropriate timeline expectation for target collection;
3.    Collect based on the optimal order;
4.    Learn to give up;
5.    Physical contact is of paramount importance;
6.    Pandas are far from common;
7.    Do not dismiss early official medals;
8.    Establish one's own price comparison theory.

Once collectors have mastered all these essentials, with the help of good luck, effort and wealth, they will have the opportunity to uplift themselves, and gradually ascend to admirable heights.

Beginners' Approach to Collection

by Huang Ruiyong
Source: http://bbs.jibi.net/dispbbs.asp?boardid=70&Id=233597&page=2

Good evening everyone. Jibi.net gave me a grand title. I do not feel quite up to it, though.

Honestly, the overall research in the MCC coin field looks weaker than in other coin segments. But just because of this, a historical opportunity presents itself to us. Let’s collect with pleasure, put our hearts to research, and we will have a splendid future.

The three lectures starting from today cover the following topics:

1.   Beginners'  Approach to Collection

2.   Transition to Intermediate Collectors

3.   Top Choices for Advanced Collectors

Let's take a look at the topic today, which is directed at new collectors.

Many new collectors get to know precious metal coins and medals of the PRC, and feel deeply impressed. But they have no reference books, no access to the markets in Beijing and Shanghai, and no teachers to learn from. They grope the way all by themselves, like walking in darkness, with extreme difficulty. So I will provide the many new collectors with some suggestions, from the perspective of collection.

“A job can be completed more easily with sharp tools.”

In coin collection, one will definitely gain success if the DIRECTION and APPROACH are correct.

A new collector must adopt the right methodology from the very beginning, focusing on the following aspects: affinity with the coins, logic reasoning, coin knowledge, awareness of the real gems, making friends, and receiving correct information.

If we manage all these aspects successfully, we can pass the beginner phase with success and no hassle. Now let me expand these aspects in detail.

First let’s talk about coin affinity.

What is coin affinity? It is directly “fall in love at first sight.” You fall in love with a coin at first sight, intoxicated by it, applauding it loudly with admiration. This comes from pure appreciation, without any consideration of material gain.

For example, the first set of Bronze ware gold coins were crafted by Tong Youming and Sun Qiling, two top engravers of Shanghai Mint, who put all their heart and soul into these coins. You set them out in a row under spotlights, and watch them beaming out dazzling lights and colors, simply gorgeous and beautiful. It is hard to imagine anyone resisting their temptation.

Another coin is the 2001 2oz Dunhuang silver coin. The sacred image of the buddha in high relief from the prosperous Tang Dynasty is absolutely stately and life-like. The ingenious use of frosting and anti-frosting on the coin endears it to many collectors.

This is coin affinity. If you are a collector and you can pick out the coin you like at first sight from a pile of coins, congratulations! This comes from your coin affinity. It is absolutely a wonderful thing to feel this affinity to a coin.

Most collectors start from appreciating modern precious metal coins due to coin affinity, and then go out of their way to search for and collect these coins.

We all say that there are no cheap or expensive collections, meaning for an item, if you can appreciate its merits, it is worth collecting. But wait! Although we do not distinguish between cheap and expensive collections, there are degrees of sophistication in collection.

For modern precious metal coins issued by the PRC, nobody has the financial power or market channels to collect them all. A newbie should avoid trying to grab at everything in order to advance their own collection. Do not covet every coin that comes in sight. Otherwise your pocket will always be empty, and you be enslaved by coins. Learning what to go after and when to give up, picking coins that you feel affinity for from your own perspective: these are the basis for a newbie to move up to more advanced levels.    

After the discussion of coin affinity, let’s focus on the importance of logical reasoning.

If we want to achieve high quality in any work, a methodology that employs logical reasoning is a must. An effective methodology cannot be developed in one day, but logical reasoning can help us with objective analysis and judgment on many occasions.

For example, for a beginner, a top issue is whether a coin is worth buying for the price. On this mind racking issue, logical reasoning can come to our help.

Here is an example:
5oz pandas were issued in many years. In general, if the prices are the same, we will pick the one with the smallest mintage. If the mintage is the same, we will pick those issued in earlier years.

Another example:
If the 1/2oz Guandu Battle gold coin and the 1/2oz Chibi Battle gold coin are not very different in price, we will definitely pick the Guandu Battle coin. The reasoning is: 1. Guandu is from the second set, while Chibi is from the third set; 2. Guandu’s mintage is 2000, while Chibi’s mintage is 3000.

Logic reasoning dictates that when we pick coins we have affinity for, we must consider the following factors: mintage, excellence in design, technology, awards received, key date status, packaging, whether made from platinum or palladium, whether priced close to bullion, whether belonging to a special segment (such as piefort, bimetal and coin alignment). Once we developed logical reasoning, we have met the critical requirements for moving up.

The third aspect is coin knowledge. This is a key point, too. In any art collection or investment field, professional expertise will finally transform into physical wealth. This is universal, in China and abroad, in ancient times and in current days, with no exception. With regard to modern precious metal coins, I would like to kindly remind new collectors: gold and silver coins by nature are dual functional, for collection and appreciation, as well as for investment. If we dive deeply into coin knowledge, we will finally harvest both a great collection for appreciation and rewarding investment return. But if one focuses exclusively on investment or speculation, ignoring the essence – accumulation of coin knowledge, he or she will lose out in the long run.

Coin knowledge needs to be accumulated with solid effort: buy coin catalogs/reference materials, visit coin markets, browse online gold and silver coin sites, go to coin shows, communicate with friends constantly, inspect physical coins, and summarize one’s own knowledge from time to time. In this way, you will find yourself transformed into a veteran before you even realized it. 

Of course, it takes great pains to accumulate rich coin knowledge. But if you really like modern precious metal coins, this effort is worth the effort.

Next, we need to establish a sense of gem coins.

What are gems? Gems are like the moon amid the many stars. As time goes by, fashion will fade with wind and rain, but gems will shine forever.

Gems can be divided into high-end gems and gems for the masses. High-end gems, judging from the term, are targets of the top collectors and the super rich. They are like villas in the Xiangshan area in Beijing or those in the Sheshan area in Shanghai. We believe that gold and silver coins generally have three kinds of values: 1. Enjoyment value; 2. Investment value; 3. Show-off value.  For the high-end gems, the show-off value is more dominant. For example the flower-watering (Year of Children) piefort gold coin, 5oz gold coins with a mintage of less than 100, platinum lunars… These are all high-end gems which will only change hands among top collectors or appear on auctions. These are the most expensive coins.

On the other hand, the gems for masses are those affordable by the ordinary people, like the SOHO buildings in the Jianwai area in Beijing, or apartment buildings in the Xujiahui area in Shanghai. Although the gems for masses are a lot cheaper than the high-end gems, their collector base is much larger than that of the high-end gems. These include Year of Children gold and silver coins (normal thickness), 8g lunars, 1989 platinum panda, and the award-winning coins over the years. These are all excellent gems for the masses.

These gems, whether high-end or for the masses, will lead price surges and resist price declines. Their ownership is endorsed by the collector community. In this sense, it is vital to develop a sense for the gems. This is especially important for beginners, because it will save them a lot of wasteful errors.

How can a newbie make sure that the coins he or she collects are gems? Coin affinity, logical reasoning and coin knowledge, which were discussed above, all play an important role.  To those, we can add the following aspects: making friends and information symmetry.

Making friends is key to precious metal coin collection.

The Analects by Confucius said: We have three kinds of friends to benefit from, those with integration, those with tolerance, and those with rich knowledge. We need friends with such qualities. Friends with integration will let us see other perspectives than our own. Tolerant friends will encourage the voicing of different views in the coin collection community. Knowledgeable friends will help us save time and wasteful errors. For most people, coin collection is a hobby after work. Because of this, we do not have enough energy to explore details of everything. So friends are great complements to our personal limitations.

Coin collection has never been an individual experience, something one can keep just to oneself. When we get hold of a piece of treasure, we immediately feel our heart pounding with maddening elation. But this elation has to be shared with some one. So getting together with friends, chatting over a cup of tea, showing one’s own collection, exchanging new learnings, trading coins and expanding one’s coin knowledge, these are extremely pleasant experiences.

There is a club for fans of modern coins and medals in Hangzhou now, who meet regularly. On the bank of the West Lake, in a warm breeze, sipping fragrant tea, watching glittering gold coins, we get together to spend a happy afternoon or evening over the weekend. Like what Sister Sandezi said, if you can enjoy it with others, why keep it to yourself?

For beginners, breaking the information barrier is critical, too. Luckily we have information readily available these days, and the coin market has totally transformed itself in 10 years.

10 years ago, prices of gold and silver coins in major cities like Nanjing and Hangzhou had a time lag from the prices in Shanghai, not to mention in small cities or county seats. But now, with the power of the web, many collectors can make impressive gains even from small cities. For example, although Youxia is located in a remote place in Northern Jiangsu, he can make contacts abroad and find impressive coins for fellow collectors. His timeliness is no less than that of coin dealers in Lugong or Madian.

It is my personal view that collectors have more options in the world of Internet. Before buying a common coin, do price comparison on the web. But for coins with a high price tag, it is imperative to do as much homework as possible in advance. Now the topics discussed above all circle back to us: coin affinity, logical reasoning, coin knowledge, awareness of gem coins, a group of friends. With more thinking and knowledge, we will feel more confident. I believe that the purpose for jibi.net to list honest dealers is to build the reputation for them, and remove the information barrier between dealers and collectors.

In addition, with new releases and common coins, the market is relatively transparent. But due to the extreme scarcity of some early precious metal coin gems, it is absolutely a seller’s market. In addition, because there are few transaction records available, which beginners have a hard time to obtain, they have to take great precautions when buying/trading such coins. It is not that dealers are always trying to trick collectors. To be fair, the price information of some early coins is even beyond the reach of coin dealers.

I have been sorting out transaction price data of modern Chinese gold and silver coins from all over the world. If anyone is interested, we can compare notes sometime and use them as reference. As far as I know, auctions exclusively for modern Chinese gold and silver coins will be held this year. Auction records will be used later on as important guides for early rare coins.

Time is running out. I have covered only a small part of the materials I prepared. Sorry to you all.

To summarize:

Coin affinity will guide our affection to the coin;
Logic reasoning equips us with the ability to maneuver through the market;
Coin knowledge is the requirement for beginners to grow;
Awareness of gem coins enables us to take off;
Good friends make us completely relaxed;
Symmetry in information gives us a sense of security.

If beginners can achieve all these, they will naturally advance to intermediate collectors before long.