If Only I Could Use eBay to Short Sell Coins…
Caught this article yesterday on the new 2009 Lincoln pennies:
A quick review of recently completed eBay auctions shows unmarked rolls selling for $30 to $50 each. Single pennies have sold for $2 to $4 each. Rolls with a Lincoln postage stamp and cancellation from the first day of issue at Hogdenville, Kentucky have sold for over $200. Most astoundingly, a single 2009-P Lincoln Cent graded NGC MS66RD and attributed “First Day of Issue” has sold for $400.
It’s truly bizzare. $0.50 rolls of the new Lincoln pennies are going for $30-$50 on eBay. That’s insane. We’re talking about a coin that will be minted in the hundreds of millions, if not billions, this year.
What I would love to do is to “short” these rolls – effectively presell them at this price, collect money now, and then send the rolls in a few months when you’ll be able to source them at less than $1/roll.
Unfortunately, that violates eBay policy. It’s for good reason, since short selling actual inventory is hard to distinguish from a scam transaction. After all, how do you know the seller will make good on the future delivery? What is the recourse for the buyer?
The lack of short selling, however, means that temporary supply/demand imbalances like this lead to effective price gouging for buyers who assume the eBay price is “fair”. It’s certainly fair for the moment, but the expected ROI on this purchase for the collector is likely to be disasterous.
Still, I wouldn’t mind the ability to short sell a few hundred rolls. If you have access to a bank that actually has these rolls, you’d be a fool not to put them up on eBay quickly, before the prices settle down. Do I have any readers in Kentucky? If so, can you pick me up a box?