The E-Sylum:  Volume 8, Number 33, July 31, 2005, Article 8


Roger deWardt Lane forwarded a link to a May 9th story
in The Charlotte Observer - entrepreneurs there made a bulk
purchase of obsolete Iraqi coinage, with the intention of
marketing it to the general public.

"They are piled 3 feet high in a 1,225-square-foot portion
of a Charlotte warehouse, roughly 7 million bagged coins
that sparkle even in the dim light.

The coins were once part of Saddam Hussein's currency,
all of them fils of varying smaller denominations.

They have no value in Iraq -- except for their melted-down
copper nickel and stainless steel.

But two Charlotte men, Michael Crowder and Lane Ostrow,
are betting they are worth millions on the international collectible
coin market. They are selling them for $19.95 as limited-edition
sets of four coins not only to turn a profit for investors and for
themselves -- but to turn Saddam's coins into a satisfying irony.
 From their sales they want to donate at least $5 million to
organizations that help families of fallen or wounded U.S. troops."

"Two 18-wheelers were needed to get the coins to Charlotte.
The stash is not a spoil of war, but a product of difficult and
legitimate multi-national negotiations between coin dealers and
British, U.S., Iraqi and Kuwaiti officials. Because Iraq has no
mint, the coins were stamped in Canada between 1971 and
1991. They were never circulated in Iraq, but shipped in mint
bags to the southern Iraq city of Basra, the country's second-
largest city, where they sat in a bank."

To read the full story, see: Full Story

Roger writes: "The problem with this promotion is that it hurts
the coin collecting image and when they advertise on TV (as
they say the will) they sucker in the public that they are getting
something rare.

The coins were 'stamped' (minted) in Canada, shipped to Iraq,
stored in a bank for years and never issued to the Iraq people,
so that makes them more like NCLT. They have no intrinsic
value and with only about a few thousand collectors of foreign
coins in the U.S.A. (and few if any collect modern non-silver coins),
some half million American families are going to get ripped off.

It is too bad that a knowledgeable coin dealer is putting over
this fraud on the patriotic American families and a worthwhile

Sorry that this story gets me so heated up."

[I think I'm more in the caveat emptor camp on this one.
At $19.95 no buyer will go broke on these, and a lot of that
price covers the packaging and marketing. I won't go down
the path of discussing the politics, but as a mass-market
collectible this doesn't sound like such a bad deal for the
public. Anyone who really thinks something they buy from
a TV ad for $19.95 will make them rich is beyond help,
and it might introduce some other people to the hobby of
collecting coins. That's an awful lot of coins to try to sell,

[As a totally non-numismatic aside, actually, I can think
of one TV promotion that did make a lot of money for
some people. Back in the early days of cellular
telephones, the U.S. government set up a lottery to
distribute rights to portions of the required radio
spectrum. Some entrepreneurs seeking to increase their
chances recruited investors through infomercials. For a
fee of a few hundred dollars they would guide people
through the application process. A lot of people actually
managed to win the rights, making "truck drivers,
hairdressers and pig farmers" (as one author put it) owners
of very valuable assets. The catch was that they were then
left with a legal obligation to set up cellular phone operations
within a certain time period. Having no clue how to actually
do this, they usually sold their rights for tens or even hundreds
of thousands of dollars, often to the people who helped guide
them through the initial process. People like Craig McCaw
then crisscrossed the country buying up these licenses and
stitching together a national network.

As Yakov Smirnoff would say, "What a country!"
The government gave away stuff for free, ordinary
people made thousands, middlemen made millions,
McCaw became a billionaire, and decades later we
still can't get our cell phones to work everywhere.
Go figure.

Now back to numismatics. I asked Dick Johnson his
opinion about the proposed Iraqi coin promotion, and
got an earful. -Editor]

Dick Johnson writes: "In my opinion they should have filled
a van with selected specimens of the many millions they
obtained and sent the two semi trucks to the nearest
smelter. There is NO WAY the market can absorb such
a large quantity of coins, either now or in the foreseeable

Unless the two entrepreneurs can come up with some
remarkable marketing plan -- far more than a pitch or two
on TV home shopping shows -- will it be possible to sell
even a few tenths of one percent of such a vast hoard. I
have witnessed similar attempts in the past to the abject
failure and loss for the promoters. (The first such situation
that comes to mind is the discarded copper sheeting off of
the original Statue of Liberty.)

If the two businessmen want some useful advice hire me as
a consultant (my fee is $1000 a day). Here is one free suggestion:
After melting the coins, recast this metal into something beautiful
and significant. The coins are symbolic of a dictator and will,
in their original state, have some gruesome appeal -- like Hitler
memorabilia of the past. But beauty and patriotism sells. Make
something beautiful and patriotic from that metal.

What they have is a few tons of RELIC metal. This could be
used to strike medals -- why not offer the copper-nickel metal
to the makers of the U.S. decoration for the Iran Campaign Medal.
(Contact the Institute of Heraldry.) But don't expect to use it all
up even for as many medal issues as they could dream up. (Oops,
I gave away a second free suggestion!)

As for these coins' numismatic status: They exist, therefore
they are collectible. Are these NCLT, noncirculating legal tender?
No. They are -- or were -- legal coins. Consider the original
intent. They were intended and authorized to circulate in a legal
way at the time in a designated geographical area (that is, a
country). The fact they never reached circulation means only
one thing: They are not worn. Now they are de facto
demonetized coins."

  Wayne Homren, Editor

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