Sunday, November 28, 2010

What To Collect

What to collect is entirely up to the collector. It will normally be a specialization that holds some interest for the collector and is within his or her budget.

Among the most popular types of collections are world coins (coins from several countries), ancient coins, and coins of a particular country. Some specialization within these categories is ordinarily helpful. If collecting from a particular country, you can work on one or more series, a type set, commemoratives, errors, die varieties, paper money, etc.

You may also want to set bounds on the grades of coins you collect, e.g. all G-VG, VF or better, or un-circulated. You could collect an entire series. The goal of a series collector is to acquire one of each date and mintmark made, usually including any major design differences. For example, the U.S. Standing Liberty quarter was produced from 1916 to 1930 at the Philadelphia, Denver and San Francisco mints (coins were not made at all three mints every year, and none were produced at any mint in 1922); a major change to the obverse was made in 1917, and the full set is generally considered to include both designs for that year from each mint.

A collector building a type set seeks to have one of each series and major design variation within each series. Examples would be 20th century Canadian coinage or U.S. gold coins.

You may choose to focus on ancient coins. That is coins that were minted prior to 500 A.D. Many of these are in a theme and that is one way to focus your collection.

Experts say that the gold, bronze, and silver coins of the ancient world are actually quite readily available today and can be had for not a huge investment.

Tokens are also popular with collectors. When the government ignored the needs of the people and refused to issue sufficient low value coins the traders took matters into their own hands and issued tokens. In Great Britain this took place in the mid 1600's, the 1790's and the 1810's. These formed a local currency and it took several acts of Parliament to ban them. The bans were never completely successful and 'advertising tickets' continued to be issued through the mid 1800's. These were conveniently the same size as farthings, the coin still in very short supply, and undoubtedly circulated as such.

By the end of Queen Victoria's reign the need for tokens had gone but there were all sorts of other similar pieces being used. Pubs issued checks but because they were such an everyday occurrence nobody thought the record how they were used!

The co-operative societies used checks to record the value of purchases made so that the correct amount of dividend could be paid. Fruit pickers received tallies to depending on the quantity of fruit picked. The most recent use of tokens is probably the ones used in gaming and vending machines, as well as the one used by the many transport undertakings.

Although less valuable than coins, tokens are nevertheless much more interesting if you are interested in local history and like to do research.

You may want to look into collecting proof sets. Proof coins are specially manufactured for sale at a premium to collectors and sometimes for exhibition or for presentation as a gift or award. Proofs are generally distinguishable from ordinary coins by their mirror-like fields, frosty devices (especially in recent years) and extra sharp details.

To obtain these qualities, each proof coin die is polished to produce an extremely smooth surface and used for a limited number of coins. Planchets are hand fed to the coin press, where they are struck at a higher than ordinary pressure. Struck coins are removed by hand with gloves or tongs. Modern proof coins are usually packaged in clear plastic to protect them from handling, moisture, etc.

Thursday, August 26, 2010

Begins Your Collection

There are few people who do not have at least the beginning of a coin collection. Many of us at least have one or more "good luck coins", a large penny, nickel or silver dollar, a medal or a souvenir token. Any one of these items has often led to the start of a large coin collection and a new hobby.

Acquiring a coin collection of scope, interest and value takes some time and effort. This is due to the fact there are many branches of the numismatics hobby to explore and study. Some of these take years to master but this is part of the secret of this hobby's interest and charm.

Coins are fascinating because often reflect stories of royalty, great leaders, history, power and patriotism relating to their respective countries of issuance. Famous figures become real and alive when depicted on an old coin. For example, Julius Ceaser and Alexander the Great, in ancient times; Henry VIII, Napoleon, George Washington and Abraham Lincoln are portrayed on coins just as they appeared at the time.

It's best to start our collection by choosing what we want to collect. It's difficult to say "I just want to collect coins" because the are hundred and hundreds to choose from. If we want to just amass a few stray coins for our own pleasure, by all means, we can do so, but this is not really coin collecting.

True collectors strive to complete sets of coins. That's part of the allure - hunting out the coins that will fit into their set. Do not try to specialize in too many categories as it can become time consuming and expensive. We may want to attend a coin show to see some of the specialized collections often on display and find one that interest us.

It's important to study the hobby - a lot. Familiarize yourself with coins and what you will be collecting. If you don't study the hobby, you risk investing a lot of money an over-priced and counterfeit coins.

Collecting coins from circulation is a great place to start. The risk is negligible (you can always spend the coins) and you can learn a lot examining yours coins carefully and seeing what a reference book say about them.

This is easiest and least expensive way to begin collecting coins. You must do so systematically. Otherwise, you will let too many good coin to get away. Every day, put aside any coins you receive in change. Keep them either in a separate pocket or in a separate spot inside your purse. Do this with every coin you receive.

Then, in the evening, go through the change, keeping the coins you don't have. Also compare your day's catch with the coins in your collection, exchange the poorer coins in your collection for better ones from the change. By consistently checking your change every day, you do not only add to your collection, but also upgrade its condition. Upgrading a coin is almost as much fun as finding it.

Sunday, August 22, 2010

Some Fun Facts About Coins-2

As previously mentioned, all these coins denominations are now composed of copper - nickel clad with an outer layer of a 75% copper, 25% nickel alloy and a pure copper core. Nickels are made of the same copper-nickle alloy but without the copper core.

The penny's composition was altered in 1982 from 95% copper 5% zinc, to the current 97.5% zinc, 2.5% copper mix. This was done as a cost cutting measure and to make the penny lighter in weight.

The 25-cent (quarter), 10-cent (dime), five-cent (nickel) and one-cent (penny) pieces are the coin denominations commonly in use today. Half-dollar and dollar coins continue to be issued but rarely circulated in everyday commerce. Foreign coins exist in all sorts of denominations.

U.S. coin denominations issued in the past but no longer in use include the half-cent, two-cent, three-cent and 20-cent copper pieces and a small silver coin called a half-dime. Gold coins in denominations of $1, $2.50 ("Quarter Eagle"), $3, $5 ("Half Eagle"), $10 ("Eagle"), and $20 ("Double Eagle") were issued from time time from 1793 to 1933.

Silver half-dollars have been minted in large quantities since 1793 and placed in popularity with introduction of the Kennedy half-dollar in 1964. Silver-less half-dollars were first introduced in 1971.

Silver dollars have been issued at various time since 1793, were discontinued in 1933, and then re-introduced in 1971 in the form of the silver less Eisenhower dollar. The Eisenhower dollar was replaced in 1979 with the silver less Susan B. Anthony coin, in honor of the famed women suffrage pioneer.

A new dollar coin replaced the Susan B. Anthony coins. That coin potrays Sacagawea, the Native American Women who contributed to the success of the Lewis and Clark expedition. The coin is golden in color and make from a manganese brass metal alloy.

Saturday, August 21, 2010

Some Fun Facts About Coins

There are approximately $8 billion worth of coins circulating in the U.S. today. In the past 30 years, the U.S. Mint, who is responsible for designing and producing the nation's coins, has minted over 300 billion coins, worth about $15 billion!

Since its creation in 1972, the U.S. Mint has grown into a large enterprise with more than $1 billion in annual revenues and 2,200 employees. It is by far the world's largest manufacturer of coins and medals, producing coins not only for the U.S. but on behalf of several other countries as well.

It can be interesting to know how coins are minted. In order to make coins, the U.S. Mint purchases strips of metal (rolled into coins) in the proper dimension and thickness.

Zinc metal strips coated with copper plating are used to make pennies. Strips used for nickels are comprised of a 75% copper, 25% nickel metal alloy. Dimes, quarters, half-dollars and dollar coin are produced of strips consisting of three metallic layers fused together. The outer layer of these strips are comprised of the same alloy as that used for nickels with the third (core) layer being comprised of copper.

The first step in the coin making process involves the feeding of the metal strips through what is know as a "blanking" press. This press punches out cut round disc (blanks) about the same size as the finished coin. These blanks are then heated in a furnace to soften them. Subsequently, the softened blanks are placed rotating barrels of chemical solutions to clean and polish the metal. The cleaned and shiny blanks are then washed and dried.

Next, the blanks are sorted to remove any defective ones and the rest are put through as " upsetting" mill which raises a rim around the edges. The rimmed blanks then go to the coining or stamping press where upper and lower dies stamp the designs and inscriptions on both sides of the coin simultaneously. At this point, the blanks become genuine U.S. coins.

Finally, the finished coins are mechanically counted and placed into large canvas bags for shipment to the Federal Reserved Banks. From there they are shipped to local banks on an as-needed basis.

When the U.S. Mint was established the law required that all coins be made of gold, silver or copper. For a considerable period of time afterwards, gold was used in the $10, $5 and $2.50 pieces, silver was used to make the dollar, half-dollar, quarter, dime and half-dime while the penny and half-cent coins were made of copper.

In 1933, during the Great Depression, the U.S. Mint stopped making gold altogether. In 1965, as a result of a severe silver shortage, Congress dictated that silver no longer be used in kaming quarters and dimes. In addition, the silver content of the dollar (previously 90%) was reduced to 40% in 1965 and then eliminated entirely in 1971.

Friday, August 20, 2010

Coin Collections

The old saying goes, "Money makes the world go round." We use it every day. We can't acquired many necessary item in deed in daily life without it. We almost always want more of it, but for coin collectors, money is much much more than a piece of metal. It's a hobby, a learning experience and can be a lifelong obsession.

There really are no hard statistics on the amount of people who collect coins in the world. Some people suggest that 1 out every 10,000 people is an active coin collectors. That's pretty staggering when you think about the population of the world.

People have been collecting coins for years. At one time, it was called the hobby of kings, but today people from all walks of life and of all ages are maintaining coin collections.

Their reasons are varied. Some like the history behind coinage. Some do it to amass a collection worthy of handing down to future generations. Still others are simply businesspeople buying and selling coins to make a living. Collecting coins can be somewhat of a treasure hunt for many. The quest for that one coin to complete their collection can be an obsession.

Whatever the reason, coin collecting is a very popular hobby - one that can be pursued by all age groups. There are actually educational benefits to getting children started as coin collections.

The practice of numismatics - that is, the collection and study of coins, paper money, tokens and medals - offers the collector many different areas to specialize in. With the many specializations of coins, there is a wealth of material out there for coin collectors to concentrate on which makes it such an interesting and diverse hobby.

Friday, July 23, 2010

Limitation of Ratio Analysis

Financial statement analysis is an attempt to work with the reported financial figures in order to assess the entity's financial strengths and weaknesses.

Most analysts tend to favor certain ratios. They may leave out some of those mentioned in this topic and include some not mentioned. Although other ratios may be of interest, depending on one's perspective (i.e., manager, stockbroker, investor, creditor), there is no use in computing ratios of unrelated items such as sales returns to income taxes.

A banker, for example, is concerned with the firm's liquidity position in deciding whether to extend a short-term loan. On the other hand, a long-term creditor has more interest in the entity's earning power and operating efficiency as a basis to pay off the debt at maturity.

Stockholders are interested in the long-run profitability of the firm since that will be the basis for dividends and appreciation in the market price of stock. Management, naturally is interested in all aspects of financial analysis since they are concerned with how the firm looks to both the investment and credit communities.