The Dow Jones Industrial Average October plummet and the worldwide consequences of Lehman Brothers filing for bankruptcy and its stock going from a 52-week high of more than $50 to a low of about eight cents a share, has brought unparalleled activity in the numismatic market. It has also in the face of wild price swings made rare coins appear to be the pillar of stability.

It also has brought out consultants and commentators involved heavily in the rare coin market, and given the impression that gold remains an object much admired as well as feared - the ultimate hedge against inflation and runaway tangible assets performance, and a solid, not disjointed market.

In a record week of market trading Oct. 6-10, American corporations have lost equity of over $11 trillion. The amount is estimated by CBS radio and seems reasonably accurate. At the same time, gold has marched forward and there is solid demand for bullion as well as numismatic products.

As the accompanying charts show, the Dow has lost a lot of ground. Gold acted protectively and has been a steady riser; silver and platinum have declined from 2008 heights.

Tangible assets in general did well in the past six months. Farm land, for example, held its own according to Iowa State University professor Michael Duffy, who maintains a farmland Web site that has captured the spirit of the challenge.

"[T]he latest surveys, as of September, still showed a 17 percent year-to-year increase in value [for farm land]. As for now, I think it has stabilized. Whether or not it has dropped I can't say for sure," Duffy declared in an Oct. 7 e-mail.

Duffy's opinion is based on old, dirty data; his response today, "We are starting our survey the 1st of Nov. My gut feeling is that it has stabilized but not started dropping. Grain prices are off and input costs are through the roof."

Dennis Baker's NumisMedia constantly monitors price, and supplied the citations and other problems in a less than ideal situation. I asked Baker if he could update some gold coins for a "daily" response, but his answer is that the market is not homogeneous, prices are not only not uniform, but it is impossible to give back the reliable data that the 50+ breakfast table generation usually sees in the financial pages of daily newspapers because of a clear problem in accumulating reliable data.

Excerpts from a long e-mail with Baker: "All [price guide] prices are recycled every three weeks. However, we update some series intermittently between this period. You get the wholesale booklets from us ... Take a look at the specific prices from the HD booklets over the last several weeks and see how they look."

Baker's overall comment: "Initially, $20s went down and there were lots of supplies with no buyers. Then when all hell broke loose, this is when premiums started to increase rapidly ..."

I had an idea of tracking $20 gold pieces against the market. Baker suggested it was impractical, given the "free market" already established: "I cannot give you prices for $20s on a daily basis. We don't track them daily. And I don't have the time to try and develop something for you," Baker said. Maybe next time.

Baker's views may be synthesized with these concluding comments: "Money is the strength of the coin business and there has never been a more opportunistic time to purchase rare coins." He's right about that.

His final word: "Whether buyers are acquiring numismatic coins or bullion-related modern coins, dealers are noticing a tremendous increase in business currently taking place. Buyers want physical coins in their hands because they do not trust paper stock certificates."

Baker was able to give me pricing for what represented the list found originally in a Salomon Brothers survey, back when it was a investment company embarrassment. The Oct. 9 pricing makes this column more than an estimate - it jumps up to a more effective research tool.

The value of the Salomon charts derives from the fact that old Salomon Brothers information sheets knew nothing of these expansion plans, yet is flexible enough to be usable in 2008, even if the data harvesting began in earnest after 1978.

Coins on the list include:

1. 1794 Liberty cap half cent, extremely fine
2. 1873 2-cent piece, brilliant proof
3. 1866 5 cent nickel with rays, brilliant proof
4. 1862 3-cent silver, B.U.
5. 1862 half dime, B.U.
6. 1807 Draped Bust dime, B.U.
7. 1866 Seated Liberty dime, B.U.
8. 1876 20 cents, B.U.
9. 1873 arrows quarter, B.U.
10. 1886 Seated quarter, B.U.
11. 1916 quarter, B.U.
12. 1815 Bust half, uncirculated
13. 1834 Bust half, B.U.
14. 1855-O Seated half, B.U.
15. 1921 Walking Liberty half, B.U.
16. 1795 Draped Bust dollar, B.U.
17. 1847 Seated dollar, B.U.
18. 1884-S Morgan dollar B.U.
19. 1881 Trade dollar proof
20. 1928 Hawaiian commemorative half dollar

The contents of the portfolio was never revealed by Salomon but was revealed in a book by Hans M.F. Schulman and Neil S. Berman in 1986. Coin & Currency Institute published a new analysis by Berman and Silvano DiGenova in 2007.

Baker's October 2008 price changes show that this year, up $13,380 for year to date and about $2,500 for the past quarter.

Salomon created an investment analysis model using a small number of just 20 silver and copper coins, some Proof-63 but mostly choice uncirculated specimens. (No gold was included because investment was too new - not until December 31, 1974, was private gold ownership permitted in the U.S. after a shut-down of more than 40 years.

Surprising results when 20 coins were factored into a portfolio: it outpaced the equities market. Using the same 1976 starting point, it would have cost about $33,000 to assemble a holding of each of the coins. The following year, 1977, showed a 5.61 percent gain. Not rocket gains, but when measured against a flat market, impressive. The following year, a 4.17 percent gain and in 1979, the portfolio acquisition cost jumped to $43,000 and a gain of more than 19 percent.

In the short span of three years, an average exceeding 8 percent annually was achieved.

The remarkable feat of holding its own as the Dow stumbles and other stocks tumble shows how many are viewing the Dow. The reasons why tangible assets such as coins are more than holding their own is covered in the next report.

Numismaster