Superman coins flew off Mint shelves
No purchase limits for dealers creates inflated prices for those who missed out
You had to be Superman to get your hands on a gold coin celebrating the 75th anniversary of the superhero’s creation by Canadian Joe Schuster and American collaborator Jerry Siegel.
The Royal Canadian Mint released only 2,000 of the 14-karat gold coins, with a face value of $75 and priced at $750, in early September. There was a limit of two coins per household.
The Mint’s stock sold out within hours, pushing prices up to $2,500 and $3,000 on eBay and Kijiji (with one seller seeking a bid of $5,157).
Randy Solomon missed out at the Mint and started calling Toronto-area dealers. He was surprised to find they didn’t have a limit.
“Why are there two sets of rules for the public and businesses in the number of coins allowed for purchase, especially when this is a crown corporation?” he asked.
He contacted me, saying the Mint’s customer service had brushed off his inquiry and a manager didn’t call back after two weeks.
I thought he had some good questions: Why didn’t the Mint print more Superman gold coins if they were so popular? Why sell out at $750 and create inflated prices on the secondary market?
The limited quantities add to a coin’s desirability, said Mint spokesman Alexandre Reeves.
“The defined production run is a factor in pricing collector coins at retail and on the secondary market. There is no changing the mintage after it is set, since this would devalue coins already bought by collectors.”
What about having higher limits for dealers? Reeves said the Mint depends on a network of official distributors to promote and ensure customer access to its products in Canada and around the world.
Official Mint distributors can buy new products in quantities greater than individual customers would order them, and offer them at or near retail pricing in their local markets. While at least half the mintages are reserved for the public, limits may be imposed on hot products, such as Superman gold coins.
“This curtails bulk ordering by individuals and helps prevent the resale of a large percentage of a specific product at exorbitant prices,” he said. But are customer limits enough? What limits, if any, exist for distributors? The Mint never discloses the terms and conditions of transactions with any commercial partners, Reeves said. It operates on a commercial basis and has a mandate to generate profits to fund its operations. I found a Kijiji seller looking for $2,900, cash only, for the “hottest coin of the year,” his ad said. “Unfortunately, I have bills to pay and must let this one go.” He responded to my message, saying he couldn’t find any coins to buy at retail outlets a day after the release. But he found coin dealers with stock and managed to send orders to a few places. As for Solomon, he was upset when coin dealers told him they had sold lots of coins, but had even more stock coming in at quantities greater than the advertised two per household. “It should be common sense that with no limit only for registered dealers, they are able to quickly buy up the very limited run on this coin and grossly inflate the value at their whim,” he argued. In its 2012 annual report, the Mint reported the highest-ever sales of numismatic and collectible coins — a total of $145.1 million, compared to $152.5 million for coins in Canadian circulation.
Let’s hope the Mint looks at imposing purchase limits for everyone when hot coins are issued. The proliferation of online deals at several times the retail price shows distributors have a role in fuelling the resale market. Ellen Roseman writes about personal finance and consumer issues. You can reach her at eroseman@thestar.ca or ellenroseman.com