The Quarter Million Dollar Mistake

Collectors usually go for the unusual, and with coins, the more unusual, the better.  That’s why they flock to mispressed coins, off-center coins, coins with one date struck over another, coins struck using the wrong sized blanks, or any one of a number of other oddities.  Coin collectors like those oddities that can be seen.

That’s why it’s a bit odd that a collector recently paid $282,000 for a Lincoln penny that, to the casual observer, didn’t appear to be remarkable in any way.  It’s your standard-issue, copper Lincoln penny with the “wheat back” that was minted for 50 years by the billions.

1943 copper cent
The 1943 copper cent

It looks just like billions of others.  What makes it unique?  It’s not supposed to look like all of the others.

This particular Lincoln penny was minted in 1943.  That year is unique among all of the 109 years and counting that the Lincoln penny has been produced by the U.S. mint.  In that year, Congress declared that due to a shortage of copper, all pennies were going to be minted from zinc-plated steel instead.

These pennies, known as “steelies,” are pretty unusual in appearance.  When new, they were pretty shiny, with almost a mirrored surface.  Few are seen that way today, and after 70+ years of lying around, most of those steel pennies have taken on a dull, gray appearance.  Still, they’re unique, and collectors like them.

They’re also quite common.  The Mint made hundreds of millions of them and while you aren’t likely to find one in circulation today, they’re not overly expensive unless you’re trying to find one in exceptional condition.  For MS 65, or so, you might pay a few hundred dollars.  Otherwise, you can shop around and buy a roll of 50 of them for $10-$15 or so.

1943 steel cent
What it should have looked like

So what was so special about this particular penny that sold for so much money?  It was dated 1943, but made out of copper instead of steel.  This was a mint error, and was attributed to being one of a few copper dies that were left or stuck inside the machinery when the new steel blanks were put into it.  A few of them came out made from the wrong material.

Mint employees likely found most of them, but a few appear to have found their way out of the building and over the years, surprisingly few of them have turned up for sale.

So, in this case, the truly odd item is unusual in that it doesn’t look odd unless you are aware of the context.  If you know that all 1943 cents should look silver or gray, then a copper-colored one is going to attract attention.

And attract attention it did.  That’s a lot of money for a Lincoln cent.  While they’re widely collected, most of the dates in the series are relatively common and it’s not all that difficult to put together a set in better than average condition.  The exception, of course is the copper 1943 cent, and for that one, you might have to wait a good long while to find another one for sale.

Start saving your money.

 

Are Watches Going Away?

The watch has been around for a couple of hundred years.  Early versions weren’t wristwatches, but were pocket watches, attached to your pants by a chain so you could pull it out of your pocket to look at the time.

A fossil watch
A Fossil hybrid smartwatch

The wristwatch became popular after World War I, and for the next seven decades or so, became a fashion staple.  If you needed to know the time, you just looked at your wrist.  Or you could ask whomever was standing by, because for decades, pretty much everyone wore a wristwatch.

That started to change a few years ago when cell phones became popular.  Cell phones displayed the time as a matter of course, and if you were going to carry around a phone that had the time on it, why would you also need to wear a wristwatch?   A lot of people stopped wearing watches, and a lot of younger people simply never got in the habit of wearing one in the first place.

That’s changed a bit in the past three or four years, as the smartwatch has come along.  The smartwatch is worn like a wristwatch, and can offer the time, but it can also act as an interface between you and your smartphone, allowing you to receive notifications and text messages and also allowing you to track your stats during workouts.  Many of them have other features, as well.

A lot of people have started wearing smartwatches, and a few have started wearing one instead of a traditional watch, but watchmakers are a bit mystified at the fact that they’re not becoming a huge hit with the public.  Worse – for some manufacturers, sales of all watches are down.

The Fossil Group, which makes watches under that name but which also owns a number of other companies that make watches of all kinds, recently released a quarterly report that shows that sales were down 13% in the most recent quarter.  Keep in mind that this is a company that does sell smartwatches alongside their regular traditional models, so it’s not as though they’re selling old technology and hoping that people will buy it.

A very expensive Breguet watch
A very expensive Breguet watch

Odd thing, though – people are buying old technology.  Luxury brands of watches, that is, the companies that sell unusually expensive watches, rather than the several hundred dollars apiece models that Fossil offers, are actually doing OK.  Granted, when you’re selling to ultra-wealthy collectors, you don’t have to worry too much about economic instability.  You also know that the people to whom you’re selling aren’t people who are following trends.  If you’re buying a high end Breguet watch, it’s because you want one, and not because you weren’t aware that Fossil could sell you a smartwatch instead for $100,000 less.

Still, most of the market for wristwatches falls in the sub-$1000 range, and for those companies that sell watches exclusively in that market, they have to be worrying a bit.  There was a panic in the 1970s when quartz watches hit the market that they’d put all makers of mechanical watches out of business.  A few did go away, but luxury brands managed to stay afloat.

That was then, however.  There’s no guarantee that people will continue buying watches in the future.  On the other hand, there does still seem to be a market for quality wristwatches, and it’s possible that the Fossil Group is just having a rough year.