Staff Profile - Stephen Goldsmith


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Staff Profile - Stephen Goldsmith Jun 01 2011 Coins

Spink is pleased to introduce a new member of the Spink international team, Mr Stephen Goldsmith. Stephen has an incredible history with the world of numismatics and we are honoured to have him join our Spink USA operations in New York. In order to properly introduce Stephen we sat down and asked him a few questions we thought you might want to know the answers to. Without further ado, here's a record of our chat with Stephen Goldsmith from the Spink New York office…

 

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Stephen Goldsmith



How did you get your start in the business?



All of the kids would ask their parents for a dollar, and they would go to the local grocery store to get rolls of pennies. We brought the rolls, and we brought our blue Whitman albums to the local Community Center, where Dr. Berg held a monthly meeting of the Rockaway Beach Coin Club.


We opened the penny rolls and looked through the coins for dates we needed. Sometimes we did a little trading. The kid with the most complete set got a pat on the back from Dr. Berg, and went home smiling. Everyone else would just look forward to next month's meeting. Dr. Berg always managed to expose us to a little numismatic history, but most of us were there to simply have fun.

One day when I was about ten years old, some of the kids got into a discussion about what their fathers did for a living. I had to admit I just didn't know. I went home that day and asked my mother. When I got the answer, I was ecstatic. It turned out that my father managed a penny arcade! From that day on I never had to worry about obtaining rolls of coins to look through. I now had unlimited access to buckets and buckets of pennies, nickels, dimes, quarters and half dollars! In those early days, I never approached coin collecting as a potential business. As time went on, I simply looked through coins, found better dates, sold the coins to a friend, and used the money to pay for books, gasoline, entertainment and other expenses.

I graduated high school, went to college, pursued a Masters degree in Psychology and went on to teach Special Education. In 1973, after teaching Special Education for seven years, I was casting about for a way to augment my teacher's salary. The idea occurred to me to start a small mail-order coin business.


One of the other kids in the Rockaway Coin Club had a real mind for business, and he followed a very different career path. He became a professional coin dealer. His name was Jules Karp. I always kept in touch with Jules over the years, and I felt very comfortable buying coins from him.

When I went to see him about buying some coins for my mail-order business, Jules told me that he was doing very well, and that he had just opened an office in New York City. He immediately asked me if I would be interested in going to work for him. He promised to make it worth my while, and to teach me everything I needed to know. A week later I found myself in the basement of 120 Broadway, in a subterranean vault that was piled high with bags of silver coins. I was literally learning the coin business from the bottom up.


How did you get involved with Spink?


In 1985, Jules sold his coin and paper money auction company, NASCA-KARP, to R. M. Smythe and Company. The auction business appealed to me on many levels, and I decided to join Smythe and run their auction business. At that time, I was buying and selling coins and paper money under my own company name, Atlantic Banknote and Coin, which merged with Smythe. I became a minority shareholder in R. M. Smythe, Inc., and the Executive Vice President of Smythe, a position I held for over two decades.


In 2007, I left Smythe to go out on my own again, but I soon was asked to become Director of Numismatics at Stack's.


Last December, Charles Shreve and I began a series of conversations exploring the possibility of joining Spink as Senior Vice President in the U.S. After a great deal of serious consideration, I decided this would be a good match and an exciting challenge.


What are your specialties? What should clients contact you about if they have questions concerning their collections?


During my thirty-four years in the coin business, I have had the opportunity to buy, sell or catalog a great deal of material in many different fields. No one is an expert in all areas of numismatics, but I have always made it a point to learn as much as I could about every numismatic subject area I was exposed to. I have a strong working knowledge of U. S. coins acquired through several decades of buying, selling and cataloging for R. M. Smythe and Co., and for Stacks.

I am intimately acquainted with Confederate paper money, having edited Collecting Confederate Paper Money by Pierre Fricke, the major reference work on Confederate paper money. I cataloged, or helped catalog, some of the most important Confederate paper money auctions for R. M. Smythe and Co., (Gene Mintz, Western Reserve, Frederick Mayer).

I am very familiar with obsolete bank notes. During my term as president of the Professional Paper Money Dealer's Association, I was the lead writer of An Introduction to Obsolete Currency, the first booklet in a series designed to introduce new collectors to all types of paper money. I was responsible for bringing the Herb and Martha Schingoethe Collection to auction (consisting of over 30,000 different notes, and realizing over $13,000,000), the largest collection of obsolete bank notes ever sold.

I have a good working knowledge of U. S. Federal Paper Money (contributor to U.S. Paper Money by Friedberg) and I am familiar with National bank notes (see my article in the January 2009 Currency Dealer Newsletter about California National Gold bank notes). I was a guest lecturer at the Philadelphia Federal Reserve Bank, where I spoke about symbols on American paper money (later adapted for use as a Federal Reserve educational publication). I am one of the world's foremost experts on U. S. stocks and bonds. As the lead cataloger for R. M. Smythe, I organized, directed and cataloged the largest collection of American railroad stocks and bonds that was ever auctioned (the archives of the Penn Central Railroad), and I brought the first $1,000,000 stock and bond collection to auction
as well (Charles A. Leeds, Jr. Collection).

I am comfortable around Continental Currency, Colonial Currency, advertising notes, checks and just about anything else relating to coins or paper money in America.

 

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How has the market grown since you first began?


It must be hard for today's dealers and collectors to imagine a world with no cell phones, no fax machines, no certification services and with computers that were the size of a small room, and that cost the equivalent of $50,000 of today's dollars. That is the way it was in 1973 when I got started in the coin business. Most collectors relied on their annual copy of the "Red Book" to get updated prices. Uncirculated Morgan Dollars could be purchased for around $4.95. Paper money was a tiny segment of the numismatic marketplace, and obsolete bank notes that brought over $100 each were virtually unheard of.

The numismatic world is very different today. A recently published survey shows that in the last few decades hundreds of millions of dollars worth of U. S. coins were sold by major auction companies. Now, there are many paper money shows each year, and some where there are hundreds of dealers.


How did these markets grow?


I attribute growth in the coin market to tremendously improved methods of communication and marketing, population reports and the certification of coins and paper money. In 1973, when I first started, most numismatic publications were strictly black and white, with a few two-color ads thrown in on special occasions. Books and catalogs were also primarily black and white, and it was costly and time consuming to include large numbers of photographs. Color photography of Federal paper money was prohibited by law. The dealers attempted to communicate with each other through an archaic teletype system that required the production of time consuming punched tapes in order to send messages. Images were sent by mail, or through antiquated fax machines. Mass mailings had to be made through local printing and mailing houses, and it was unheard of for a small firm to own a computer.

Dealers did their own authenticating and grading, and neophyte collectors bought coins and paper money at their own risk. There were occasional abuses, and this did not help the industry. Suddenly, with the maturity of the grading services the issue of trust was, for the most part, resolved.

Sales methods that formerly applied only to more conventional products were now employed by progressive coin dealers. Telephone salesman using sophisticated mailing lists and proven numismatic scripts began offering coins to a whole new generation of buyers. The Internet matured, and coin-related web sites proliferated. The advent of cable television sales added another dimension. Now, coins and paper money that existed in larger quantities suddenly became desirable, driving up prices on many "common" issues.

Salesman may be able to get collectors started, and to supply them with product, but true collectors begin to seek more and more information. A huge part of the growth in the coin market may be attributed to increased access to information. Today, a 10-year old junior numismatist with a Smart phone has more immediate access to numismatic auction records than the lead cataloger at any major auction house had thirty years ago. Desktop publishing has also had a tremendous impact on the marketplace, resulting in many new books on coins and paper money.

In some ways, information technology has become more important to coin sales than numismatic acumen. Many of the old-timers, who knew their coins, but could not embrace the technological issues, fell by the wayside. These factors also helped drive the paper money market, which occupied a tiny segment of the numismatic marketplace in 1973.

There is one other very important factor that applies mainly to the growth of the paper money market - the legalization or acceptance of the use of color images of paper money in print media.

As a young collector in the 1960s, I never saw a colored image of a U. S. bank note. I had no idea that large size U. S. bank notes hadever been printed. No one in my neighborhood collected paper money, and the first time I saw a large size note in person was after I began working for Mr. Karp in 1973. He had a book on U. S. currency, but all of the images were black and white, and the images were the size of large postage stamps.

One day, Mr. Karp handed me a collection of American paper money. What I saw electrified me. It was a large format note with a bright red seal, and a huge buffalo at the center. Moments later I found myself staring at an Indian Chief. I immediately fell in love. I believe that the advent of digital photography, and the acceptance of the use of printed color images of U. S. bank notes caused an explosion of interest in that field.

 

What, in your opinion, are the world's most desirable items in your fields of expertise?


My favorite coin is the United States 1792 Half Disme. There is a story behind every coin, sometimes based on proven facts, sometimes based on legend. What follows is perhaps a little bit of both. In 1790, Congress asked Alexander Hamilton to prepare a plan to establish a Federal Mint. In 1792, Congress passed the bill, and authorized the minting of half dismes. Equipment was ordered and received, and stored in a basement in Philadelphia, pending the completion of the Mint itself.

In the meantime, Thomas Jefferson had a diplomatic dilemma on his hands. Foreign diplomats arriving in this country were presenting Jefferson with sets of coins from their countries. The United States had nothing to offer in exchange - no coins to show that we were, indeed, a real country. Jefferson called on George Washington, and asked him if there was anything Washington could do to speed up the process of minting our first coins. Washington made some inquiries. The presses were there, the workmen were there, and the coins could be struck in the basement where the presses were stored. There was only one obstacle in the way. There was no silver in the Treasury. It is widely believed that George and Martha Washington turned over their personal silverware to the Treasury. The
 silverware was melted, and 1,500 1792 Half Dismes were then minted and given to Jefferson. While some purists argue that these coins are "patterns," I believe they were the first coins minted under the authority of the United States Congress.

My favorite Confederate note may, or may not, even exist. In 1861, the Confederate States of America needed sources of paper money. One of their suppliers was J. Manouvrier from New Orleans. The Confederacy ordered $5 and $10 bills from Manouvrier, but when the shipment arrived in Richmond there was a slight problem. The packages of $10 notes were not intact. A decision was made to destroy all of the remaining $10 notes printed by Manouvrier. No one knows what happened to the missing notes. I suspect the missing notes are still out there, somewhere in a safe deposit box or buried in someone's back yard. If one ever surfaces it would probably bring over one million dollars at auction.

In my view, the most desirable American stock certificate is the Ford Motor Company of Canada, issued to Henry Ford, and signed by him as President. While it is not the most beautiful piece of paper ever issued, it is a quintessential example of American capitalism. To me, it represents the birth of one of our greatest automobile companies. While many collectors have heard of or seen pictures of $100,000 U. S. gold certificates, very few collectors have ever held a genuine issued $100,000 gold certificate in their hands. I had the honor of holding two of them, both in institutions that will never sell the notes. There is, however, a single example rumored to be in private hands, with a letter from the Treasurer of the United States, granting special permission to own the piece privately.


What deal stands out above the rest?


The deal that stands out above the rest is surely the Herb and Martha Schingoethe Collection. Herb Schingoethe was simply born to be a collector, and he collected a wide variety of things - coins, barbed wire, marbles, sugar packets, airline barf bags, post cards and more - but the one thing Herb and Martha liked most was obsolete currency. Herb began collecting obsoletes back in the 1950s, and never stopped until the day that he died, amassing over 30,000 different notes. The collection was staggering in its vastness and completeness, and realized over $13,000,000 at auction.

 

Are you a collector yourself, or is there a history of collecting in your family?


No one in my family is a collector. I like ships and boats - anything to do with maritime history. At one point I put together a collection of yachting medals. I grew up in Rockaway Beach, New York, a seaside community, and I have assembled collections of RockawayBeach post cards, then donated them to the local historical society. I also have a collection of ship-related stocks and bonds.

 

If someone is starting to collect, what advice would you give them?


Find an area you are genuinely attracted to. Read everything you can on that subject. Speak to as many dealers and collectors as you can, and find one or two that you can trust based on word of mouth references. Go to shows, talk to other collectors. Go to auctions, and pay attention to market trends. In the beginning, buy some lower value items, just to get your feet wet. If you have long term gains in mind, as soon as you begin to feel more comfortable, buy the rarest and highest grade examples you can afford. You can always go back and complete your collection with the more commonplace pieces later on.


What is your favorite piece of numismatic history?



When I was younger, I loved listening to the stories told by the "oldtimers" in the business. John Ford was one of the greatest numismatists of the last century. I was lucky enough to attend an ANA lecture where he was asked about obtaining bags of silver dollars from the Treasury. The specific question asked was, "How did you know which bags to select, since they were all sealed?" John said, "That was easy. A clerk would bring out bags of sealed dollars. I would burn a hole in the side of every bag until I could see the reflection of my cigar. When I saw the reflection, I knew I had a bag of prooflike dollars."

 

What do you enjoy when you're not working at Spink?


As my collecting habits indicate, I love being around water. My wife and I own a Bristol 35.5 sailboat, and have cruised Long Island Sound, the Hudson River and the south shore of Long Island for over thirty years. I am about to enjoy being a grandfather for the first time, and I am very much looking forward to that.

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Things you would recommend seeing or doing if you are headed to a Spink auction in New York.


Don't miss the Metropolitan Museum or Art. My next stop would be a walk through Central Park if the weather is nice. Take in at least one Broadway show. "Wicked," "The Lion King," "Mama Mia" - all are well worth seeing. For a great view of the harbor, take the Staten Island Ferry across and back, or visit the Statue of Liberty and Ellis Island. If you like baseball, take in a Yankee game, or if you like underdogs, go out to City Field and cheer the Mets on to one of their rare victories.