UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                  FORM 10-KSB

     (Mark  One)

     [   ]  Annual report under Section 13 or 15(d) of the Securities Exchange
            Act  of  1934

     For the fiscal year ended December 31, 1999

     [ X ]  Transition report under Section 13 or 15(d) of the Securities
            Exchange Act of 1934

     For the transition period from January 1, 2001 to June 30, 2001

     Commission File No. 0-27121


                         TANGIBLE ASSET GALLERIES, INC.
                 (Name of Small Business Issuer in Its Charter)

                  NEVADA                                  88-0396772
     (State or Other Jurisdiction of                   (IRS  Employer
      Incorporation or Organization)                Identification Number)

              3444 VIA LIDO
        NEWPORT BEACH, CALIFORNIA                           92663
(Address of Principal Executive Offices)                  (Zip Code)

                                 (949) 566-0021
                           (Issuer's Telephone Number)
           SECURITIES REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
                                     (None)

           SECURITIES REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
                         Common Stock, par value $0.001
                                (Title of Class)

     Check  whether  the  issuer  (1)  filed all reports required to be filed by
Section  13  or 15(d) of the Exchange Act during the past 12 months (or for such
shorter  period  that the registrant was required to file such reports); and (2)
has  been  subject  to  such  filing  requirements  for  the  past  90  days.

     Yes  [ X ]   No

     Check  if  there is no disclosure of delinquent filers pursuant to Item 405
of  Regulation  S-B  is  not  contained  in this form, and no disclosure will be
contained,  to  the  best  of  registrant's  knowledge,  in  definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or  any  amendment  to  this  Form  10-KSB.  [  X  ]

     Issuer's  revenues  for the six month transition period ended June 30, 2001
total  $17,716,035.

     The  aggregate  market value of voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the common equity was
sold,  or  the average bid and asked prices of such common equity, as of October
1, 2001 (See definition of affiliate in rule 12b-2 of the Exchange Act.), totals
$6,916,823.

     The  number of shares outstanding of each of the issuer's classes of common
equity,  as  of  October  1,  2001,  totals  37,510,643.

                       DOCUMENTS INCORPORATED BY REFERENCE

     If  the following documents are incorporated by reference, briefly describe
them  and  identify  the  part of the form 10-KSB (e.g., Part I, Part II, etc. )
into  which  the  document  is  incorporated:  (1) any annual report to security
holders;  (2)  any  proxy or information statement; and (3) any prospectus filed
pursuant to rule 424(b) or (c) of the Securities Act of 1933 ("Securities Act").
The  listed  documents  should be clearly described for identification purposes.

Company's  Definitive  Proxy  Statement on Schedule 14A which will be filed with
the  Securities  and  Exchange  Commission  on  or  before  October  29,  2001


     Transitional  Small  Business  Disclosure  Format  (check  one):

Yes [  ]  No  [ X ]

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                                TABLE OF CONTENTS

                                     PART I


Item  1          Description  of  Business.

Item  2          Description  of  Property.

Item  3          Legal  Proceedings.

Item  4          Submission  of  Matters  to  a  Vote  of  Security  Holders.

                                     PART II

Item  5          Market  for  Common  Equity  and  Related  Stockholder Matters.

Item  6          Management's Discussion and Analysis of Financial Condition and
                 Results  of  Operations.

Item  7          Financial  Statements.

Item  8          Changes In and Disagreements With Accountants on Accounting and
                 Financial  Disclosure.


                                    PART III

Item  9          Directors,  Executive  Officers, Promoters and Control Persons;
                 Compliance with Section 16(a) of the Exchange Act.

Item  10         Executive  Compensation.

Item  11         Security Ownership of Certain Beneficial Owners and Management.

Item  12         Certain  Relationships  and  Related  Transactions.

Item  13         Exhibits  and  Reports  on  Form  8-K.

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                                     PART  I

This Annual Report includes forward-looking statements within the meaning of the
Securities Exchange Act of 1934 (the "Exchange Act"). These statements are based
on  management's beliefs and assumptions, and on information currently available
to  management.  Forward-looking  statements  include the information concerning
possible  or assumed future results of operations of the Company set forth under
the  heading  "Financial  Information-Management's  Discussion  and  Analysis of
Financial  Condition and Results of Operations." Forward-looking statements also
include  statements  in  which words such as "expect,"  "anticipate,"  "intend,"
"plan,"  "believe,"  "estimate,"  "consider"  or  similar  expressions are used.

Forward-looking  statements  are  not  guarantees  of  future  performance. They
involve  risks, uncertainties and assumptions.  The Company's future results and
shareholder  values  may  differ  materially  from  those  expressed  in  these
forward-looking  statements.  Readers are cautioned not to put undue reliance on
any  forward-looking  statements.

ITEM 1 - DESCRIPTION OF BUSINESS

COMPANY  OVERVIEW

Tangible  Asset  Galleries, Inc. ("Tangible" or the "Company") is a retailer and
wholesaler  of  rare  coins,  fine and decorative art, and antique collectibles.
The  Company  was  organized  as  a Nevada corporation on August 30, 1995 and is
currently  based  in  Newport  Beach,  California.

As reported on the Company's Current Report on Form 8-K dated July 20, 2001, the
Company  changed  its  fiscal year end from December 31 to June 30, implementing
such  change  for  the  six  months  ended  June  30,  2001.

BUSINESS OF THE ISSUER

The  Company's  principal line of business is the sale of rare coins on a retail
and wholesale basis.  Additionally, the Company also offers collectibles such as
fine  and  decorative  arts  at  retail  and  at auction.  The Company's primary
storefront  is currently located in Newport Beach, California.  In January 2000,
the  Company  completed the relocation of all its Southern California operations
to  its  new  headquarters  and  primary retail outlet located in Newport Beach,
California.  The  Company's  services  are  also  marketed  nationwide  through
broadcasting  and  print  media  and independent sales agents, as well as on the
Internet  through  third  party  websites such as eBay and Yahoo and through the
Company's  own  website  at  TAGZ.com.

On  December 30, 1999, the Company acquired all the outstanding common shares of
Gehringer  and  Keller, Inc. d.b.a. Keystone Coin & Stamp Exchange ("Keystone").
Keystone  is  a  wholesale,  retailer  and  auctioneer  of rare coins located in
Allentown,  Pennsylvania.  The  Company  believes  that  acquisition of Keystone
significantly strengthens the Company's market position on the East Coast of the
United  States  and  enable  the  Company  to  continue  to position itself as a
nationally  recognized  dealer in rare coins. The staff of Keystone adds further
numismatic  expertise  to  the  Company.

On  June  25,  2001,  the  Company acquired all the outstanding common shares of
HotelInteractive,  Inc.  ("HI"),  an  Internet-based  publisher  of  news  and
information  by  merging HI with and into a newly formed wholly owned subsidiary
of  the  Company  with  HI  as  the  survivor.  Pursuant to the acquisition, the
stockholders  of HI received 18,755,345 shares of the Company's common stock and
warrants  to  purchase  an aggregate of 1,407,587 shares of the Company's common
stock  in  exchange for 100% of their shares of stock in HI. Management believes
that  the  knowledge  and  technology  base  of HI will be quite valuable to the
Company  as  the  Company  expands  its  selling  efforts  on  the  Internet.

SALES OF THE COMPANY'S INVENTORY

The  Company  is  active  in  selling  rare  coins,  fine and decorative art and
antiques  at  wholesale,  retail and at auction. At wholesale in rare coins, the
company  typically  has  contact  with  the  approximate 5,000 rare coin dealers
across  the  country  by  telephone,  email,  fax,  electronic  exchanges  and
approximately  20  shows or expositions annually and sells through each of those
venues in addition to consigning rare coins to independent auction companies for
sale  at  public auction. The Company employs or contracts with approximately 15
different  persons, of which six are full time employees, to market and sell the
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<PAGE>

rare  coin  inventory  of  the  Company.  The  Company  also  consigns rare coin
inventory  to  as  many  as  five independent auction companies. Transactions at
wholesale  are  usually  completed  with recognized dealers in the trade and are
often for immediate payment or with approved credit relationships, by payment in
30  days  from  the  date of sale, with settlement from sales at auction 45 days
following  the  date  of the sale. Wholesale in fine and decorative art is not a
material or significant segment of the business. Trade credit is approved by the
Chief Executive Officer or the President of the Company. Selling prices for rare
coins  at  wholesale  are determined by the marketplace and usually individually
negotiated  with  the  buyer.  There  are  several  printed pricing guides, some
published  weekly,  that  provide pricing indications as well as a the Certified
Coin  Exchange,  a real-time exchange with bids and asks on many of the coins in
the  market.  Often,  a wholesale customer is buying rare coins from the Company
because  the  wholesale  customer  has  another  customer,  whether wholesale or
retail,  already determined. Frequently, the wholesale sales price is influenced
by  non-market factors such as the purchasing or selling dealer's liquidity, the
relative  desire  or  need  for  the  specific rare coin, the length of time the
selling  dealer  has  held  the rare coins and other factors. The Company has an
inventory  turnover  of  three  to  four  times  per  year.

When  selling rare coins at retail, the Company utilizes direct mail, telephone,
fax,  email  and Internet based retail and auctions, both private and public, as
channels  of  distribution.  The  Company  maintains  a  database  of over 5,000
customers  for  rare  coins,  fine  and  decorative  art  and  antiques that are
solicited  regularly  through these channels. During the year ended December 31,
1999, the Company launched its own website www.tagz.com offering rare coins both
at  retail  and  at  private auction on its own site using proprietary software.
During  the  year  ended  December  31,  2000,  the  Company began an aggressive
campaign  on  third  party  websites eBay and Yahoo! to sell rare coins at these
Internet  public auction sites. In 2000, the Company was named as first featured
seller on Yahoo! Auctions in the coin category and later was named as one of the
premium  sellers  in  the  coin  category  in Yahoo! Auctions. Also in 2000, the
Company  was  named  an  eBay PowerSeller , a designation for top sellers on the
eBay site. At retail, the Company typically sells for immediate payment, holding
the  rare  coins  until good funds are received. In a few instances each year on
purchases  in  excess  of  $2,500,  the Company will finance a sale for a retail
buyer  with  25%  of  the sales price paid at closing of the sale and 25% of the
sale  price  due  in each of three successive months, interest free. Under these
terms,  the  Company  takes  a security interest in the rare coins and holds the
rare coins as collateral. Selling prices for retail rare coins are determined by
the  market  and  there are several pricing guides available to the retail buyer
including  monthly  and  weekly publications and auction prices realized. Often,
the  price  to be paid by a retail buyer is influenced by the buyer's desire for
the  particular  rare coin, the time it has taken to find a suitable example for
the  buyer's collection, the relative rarity of the specific rare coin to others
held  by  the  buyer  and other factors. The Company principally sells at retail
rare  coins  that  have  been  certified  for  authenticity  and  quality  by an
independent  recognized  authority.

When  selling  fine  and  decorative  art  and  antiques  at retail, the Company
utilizes  direct  mail, telephone, fax, email, public auction and Internet based
retail  and  auctions, both private and public, as channels of distribution. The
Company solicits sales from a database maintained by the Company containing over
5,000 names and addresses. The Company utilizes its own website www.tagz.com and
eBay  to  offer  fine and decorative art and antiques for sale. In addition, the
Company  holds  from  three  to  four  auctions  of  fine and decorative art and
antiques each year as the auctioneer, taking property on consignment and selling
the  Company's  inventory at these auctions. When selling on consignment through
auction,  the  Company  typically  earns  a  commission  from  the  seller  of
approximately  10%  of  the hammer price at the sale and a 15% commission of the
hammer  price  from  the  buyer at the sale. When selling Company inventory at a
Company  auction, the 15% commission from the buyer is added to the hammer price
and  is  recorded  as a sale. Immediate payment is required on all sales of fine
and  decorative  art  and antiques, irrespective of the channel of distribution,
however,  as in the retail of rare coins, there are a few transactions each year
whereby  the  Company finances the sale under the same terms as financing a rare
coin sale at retail. Selling prices for fine and decorative art and antiques are
more  subjective  in  the market than those for rare coins as the pricing guides
are  fewer,  more diverse and less timely. Auction records continue to provide a
source  of information to assist both the buyer and the seller in establishing a
negotiated  price.

ACQUISITION  OF  INVENTORY

The  Company  acquires  inventory  of  rare  coins,  fine and decorative art and
antiques  at wholesale through other dealers in the trade, from retail customers
or  trusts  or  estates  desiring  to  sell  their  holdings or by auction. When
purchasing  from other dealers in the trade, the Company typically is offered 30
days  to  pay  the  net invoice amount. Purchases from retail customers, trusts,
estates  or  at  auction  by  an  independent  auction company require immediate
payment  upon  taking  title  and  possession  of the property. On occasion, the
Company  may  trade  items  from  the  Company inventory to either a dealer or a
retail  customer  in  exchange  for property from the dealer or retail customer.
When  buying  inventory  from  a  dealer,  the  majority  of these purchases are
completed  at  the  approximately  25  shows and expositions around the country,
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<PAGE>

although  a  significant  volume is transacted over the telephone. Purchasing at
auction is another major source of inventory for the Company in rare coins, fine
and  decorative  art  and antiques. Purchase prices are negotiated by the buyers
from  the  Company  with  each  of  the dealers in the trade and with the retail
customers,  trusts  and  estates.  When  buying  at auction, the buyers from the
Company compete with other buyers in determining the final bid for any given lot
of  property.  Factors  significantly influencing the price at which the Company
pays  for  property  include the knowledge of the identity of the buyer from the
Company  of  the  property to be purchased, knowledge of the superior quality of
the  item  relative to other similar items on the market, seller financing terms
and  other  factors.

THE  BUSINESS  OF  HI

HI,  a wholly-owned subsidiary of the Company, is a development stage enterprise
engaged  in  the  development  of  Internet  software  and  technology  and  the
deployment  of  Web  sites  containing  current  news, information, products and
services serving vertical markets. HI develops e-commerce technologies which are
capable  of  integrating and manipulating other commercially available software.
Its  model  is  to  create  online  trade communities, while secondarily forming
synergies  in  business  and  technology  by  licensing  its content and editing
technologies  to  other  Web  publishing  firms.

HI's  first  commercially  operating Web site was launched in 2000 and contain a
variety  of  news,  information  and  e-commerce services specifically for hotel
industry professionals and available 24 hours a day, seven days a week. HI earns
advertising  revenue from online banner advertising and sponsorships of specific
pages  and  events.  In  addition,  through its technology, HI offers real time,
online  trade  shows,  whereby  advertisers  offer pages of information on their
products and services to the approximate 20,000 registered users of the HI site,
primarily consisting of hospitality executives. During 2001, HI also developed a
proprietary  newsletter titled the "HIT Report" that is sent as an attachment to
an email sent weekly to the subscriber base consisting of hospitality executives
who  either  purchased  an  annual  subscription  or  were  provided  an  annual
subscription  at  no  cost  by  an  advertising sponsor that sends a promotional
message  in  the  email  that  accompanies  the  report.

HI  solicits  advertisers  who  desire  to  reach  the  hospitality  industry
decision-makers  with  a  variety  of  products  and  services  specifically for
purchase  or  consumption  by  the hotel and motel industry. Advertisers include
Tommy  Hilfiger,  Delta  Faucets,  Showtime,  Best Western, American Express and
dozens  of  other companies with a target market in the hospitality industry. HI
solicits  these  advertisers  with direct contact by HI sales personnel, through
email,  attendance at trade shows and sales through independent representatives.

With  over  35  different  content  features,  Hotelinteractive.com  adds  new
information  and  updates  reports  daily including original editorial features,
while  allowing  users  to access a searchable archive of historical stories. In
addition,  unique  computer  and  Internet  related  tools are presented for the
hospitality industry, which also can be adapted to other industries and markets.
As  a  result  of  the  acquisition  of  HI,  the Company obtained access to the
customer  list  and  software  developed  by HI in addition to the personnel and
expertise  and  business  methods  utilized  by  HI  in its news and information
format.  The  Company plans on exploiting the technology assets and expertise of
HI  by continuing the business plan of HI and expanding the news and information
formats  to include the collectibles markets. Management of the Company believes
that  the  sales  of  collectibles  may be enhanced by the increase of access to
information,  background  and history of the collectible product line and of any
specific  collectible.  Although  the  Company  believes  that  the collectibles
markets  have a great desire for the depth of information that the HI technology
could deliver, there is no assurance that the HI technology could be adapted and
deployed  in  the  collectibles  markets  with  any  degree  of  success.

PLANS  FOR  GROWTH  AND  EXPANSION

On  July  3,  2001,  the  Company  acquired  all  the  outstanding  shares  of
Vintageroadshow.com,  a  company  that  was  an  active  buyer and seller on the
Internet  and  a  PowerSellerTM  and  Premier  Seller  on eBay.com for the total
consideration  of  25,000 shares of the Company's common stock. The president of
Vintageroadshow.com,  Louis  Palafoutas,  agreed to employment with the Company.
Mr.  Palafoutas has extensive experience in the rare coin, jewelry, collectibles
and  gold  and  silver  markets,  participating  in an estimated $100 million in
transactions. With the popularity of such television programs and Internet-based
buyers  and  sellers  such  as The Antiques Roadshow, The Collectors Channel and
others,  the  Company  believes  that  Vintageroadshow  presents  a  vertical
integration  opportunity  to  make  acquisitions  of  property directly from the
public  for  later  sale  at  a  profit  into  the  collectible  markets.

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<PAGE>

On  July  6,  2001,  the  Company  acquired  substantially  all of the assets of
Superior  Galleries,  Inc.,  a  California  corporation,  a  company  that is an
auctioneer  of  rare  coins located in Beverly Hills, California for $200,000 in
cash  and  a note for $701,000 payable over six months. The Company placed those
assets  in  a  newly  formed  wholly  owned  subsidiary which was named Tangible
Acquisition  II,  Inc.,  a Nevada corporation. Pursuant to the asset acquisition
agreement,  the  Company  also  purchased the name "Superior Galleries" and such
agreement  required  the  seller  to  change  corporate names, which allowed the
Company  to  rename  Tangible  Acquisition  II,  Inc.  (a Nevada corporation) to
Superior  Galleries,  Inc.  (a  Nevada  corporation)  ("Superior").  The  seller
retained  certain rights to the Superior name in the stamp and space memorabilia
markets  for  a  period  of two years from the date of the acquisition, and as a
result,  Superior  is restricted from doing business in either the rare stamp or
space  memorabilia  markets  for  such  period.

The  Business  of  Superior  Galleries

Superior  is  an  auctioneer  of  rare coins and other fine and decorative arts.
Superior has a history dating back to 1929 with sales primarily in the rare coin
and  rare  stamp  markets. Management believes Superior is the largest rare coin
auction  firm  in  the Western United States and one of the largest three in the
United  States.  With  its  long  time  location  in  Beverly  Hills, Superior's
customers  and  clients  include  some  of the most well recognized names in the
entertainment  and  sports fields including Buddy Ebsen, Michael Jackson, Kareem
Abdul  Jabbar,  Jerry Buss and others. Superior has sold some of the most famous
American  rare  coins,  recently  including the 1913 Liberty Nickel (five known)
selling  in  February  2001  for  $1.8  million.

Superior  solicits  and  accepts  consignments  of  rare coins from individuals,
dealer,  trusts  and  estates  and  charges  a  seller's commission along with a
buyer's premium on each lot sold. The combination of the seller's commission and
the  buyer's  premium  on  each  lot  equals  approximately 10%-35% but averages
approximately  13%.

Superior  markets  its  services  by advertising in trade journals, direct mail,
telemarketing,  attendance at major shows and exhibitions and by personal visit.
Each  consignment  of  goods  is  evidenced  by  a  contract  signed by both the
consignor and Superior. In some instances, Superior may loan the consignor funds
in an amount equal to approximately 50% of the expected prices realized from the
sale  of  the  property  in  the  consignment. In this event, the consignor also
executes a note and security agreement evidencing the debt and providing a first
security interest to Superior. The proceeds from the sale of property repays the
loan  amount  with  excess  funds  paid  to  the  consignor. Upon receipt of the
consigned  goods,  Superior records the receipt on its records and then catalogs
and  photographs  the  items,  storing  the  information  in  digital  format.

Auction  sale  dates  are  established  approximately  one  year  in advance. As
deadlines for each auction date approaches, at the scheduled and appointed time,
Superior organizes all of the digitized information into a catalog of goods with
photographs and contracts the printing and mailing of the catalog for sending to
Superior's  mailing  list  of  buyers. In addition, Superior loads the digitized
catalog  into  special software managed by Internet seller eBay, so that bidders
on  the  Internet  worldwide  may  also  leave  absentee  bids to be executed by
Superior at the live auction. The special eBay software also allows for Internet
bidders  to  bid competitively with the live auction in real time in competition
with  the  bidders  present  at  the  auction  site.

Generally,  proceeds  from  the sale of rare coins to the buyers by Superior are
due  upon  the  completion  of  the  auction.  Superior  does  maintain  credit
relationships  with certain dealers in the trade and does offer payment terms of
30  days  to  those  selected dealers. The contract with the consignors requires
payment  to  the  consignor,  less  any  loan  amounts,  accrued  interest  and
commissions,  to  be  made  forty-five  days  after  the  sale  date.

Although  Superior  has  sold  more  rare  coins than other types of properties,
Superior  has  sold properties including art nouveau and art glass, including in
1992  the Arbeiter Collection of art glass and lamps, believed to be the largest
such  collection  in  the  Western  United  States. The Company plans on greatly
expanding the auctions of Superior to include fine and decorative arts, offering
both  the  inventory of the Company and properties solicited on consignment from
unaffiliated  third parties in much the manner as the Company solicits and sells
rare  coins.

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HISTORY OF THE COMPANY

Tangible  Investments  of  America, Inc. ("TIA"), the Company's predecessor, was
originally  founded  by  the  Company's current Chief Executive Officer, Silvano
DiGenova  in 1977 when Mr. DiGenova first exhibited his coins at a national coin
dealer's  convention.  That  same  year,  Mr.  DiGenova first became involved in
other  collectibles  such as fine arts and antiques.  Mr. DiGenova has collected
rare  coins  since  1971  (when he was nine years old) and by age 13 was trading
coins  among  his  peers.  While attending the Wharton School of Business in the
early  1980s,  Mr.  DiGenova  continued  to  develop  TIA,  and in May 1984, Mr.
DiGenova,  prior  to  graduating,  took  a  leave  of  absence  from Wharton and
incorporated  TIA  in  Pennsylvania.

In 1991, Mr. DiGenova relocated TIA to Laguna Beach, California and continued to
develop  TIA's  rare  coin,  fine  art  and  collectibles  retail  and wholesale
business,  continuing  to  expand it on a national level.  The Company currently
provides  coins,  fine arts and collectibles on a wholesale level to many retail
outlets  across  the nation and conducts retail sales via telephone to virtually
every  state  in  the  United  States  and  several  countries around the world.

TIA was acquired by the Company on April 28,1999.

BACKGROUND OF THE COIN AND COLLECTIBLES INDUSTRY

Throughout history, from ancient time to the present day, coins have been highly
prized  and  universally regarded as a store of value, particularly those struck
in precious metals.  Coins have been highly esteemed for their beauty and appeal
as  a solid store of wealth.  Over the past three hundred years, coin collecting
for  enjoyment  and  profit has gained increasing prominence.  The coin industry
has  been  active  in  trading  since  the  17th  century.

The  legendary  House of Rothschild (famed European Banking Family) actually got
its  start  dealing  in  rare  coins  and medals at Frankfurt's great spring and
summer  fairs.  Meyer  Rothschild,  the  founder of the banking empire, began by
selling  coins  at  the  fairs  as  well  as running a mail-order coin business.

Starting in 1771, he published the first of many printed coin catalogs, which he
sent  out  during  the next 20 years at regular intervals to potential customers
all  over  Germany.  To this day, many prestigious European banks still maintain
active numismatic departments. In a similar time frame, Sotheby's Holdings, Inc.
(NYSE:  BID)  traces  its  origins  to  1744  in  London,  England.

Today,  coins  and  collectibles  are  bought  and  sold throughout the world in
galleries,  shops,  stores,  auctions  and  on  the  Internet  at  fixed prices.

According to experts in the field, it is difficult to determine the total annual
sales  volume  of  the coin and collectibles business. As one of the two largest
auctioneers in the world in coin and collectibles markets, Sotheby's (NYSE: BID)
reported  annual  sales  of $1.9 billion for the year ended December 31, 2000. A
major  competitor  of  Sotheby's  is  Christie's  with  estimated  annual  sales
approximately  equal  to those of Sotheby's. According to reports from Ebay Inc.
(NASDAQ:  EBAY),  an  Internet-only  auctioneer  of personal and real properties
including  collectibles,  annual sales of property through the services provided
by  Ebay  exceeded  $5.4 billion for the year ended December 31, 2000. In recent
analysis  of  offerings on Ebay as of April, 2001, over 5 million items were for
sale  of  which over 2.1 million items were coin and collectibles, or 43% of the
items  offered.

With  specific  regard to coins, the U.S. Mint, in its most recent annual report
to  the  U.S.  Congress for the year ended September 30, 1999, reported sales in
the  Numismatic  Business  Unit  of  $967  million. In April 2001, the U.S. Mint
reported  that  there  are  over  125 million adult Americans collecting the new
quarter  dollar coins from the 50 State Quarters  program developed by the Mint.
This  program  was  designed  to  increase  coin  collecting  and  the number of
collectors  by minting five new designs annually of the quarter dollar with each
design  featuring  one each of the 50 states over a ten year period beginning in
1998  through  2008. In the 1999 annual report of the U.S. Mint, it was reported
that  6  billion quarters were minted, up from 1.5 billion in the previous year.

The  coin and collectibles property bought and sold by the Company was typically
manufactured originally in the late 1700's to mid-1900's. Many of the items sold
by the Company are one-of-a-kind, or have very few examples on the market at any
time. Management believes that coin and collectibles buyers typically start with
a  modest  purchase amount and increase the size of the transaction and increase
the rarity of the item purchased as the individual becomes more experienced as a
buyer  in  the  market.

                                        7
<PAGE>

THE REVOLUTION IN THE COIN BUSINESS

Determining the market value of a given coin plays a vital role.  Rare coins are
graded  on  a numerical scale from 0 to 70.  Zero represents the basal state (or
lowest condition or state of preservation) and 70 represents an uncirculated (or
mint  state)  specimen  that is perfect in condition or state of preservation in
every  aspect.  As  a  result  of  this numerical scale relating to condition or
quality, there is a correlation to value in that the higher its numerical grade,
the  more  valuable a coin is to collectors or dealers.  A one-point difference,
not  even discernible to a layman's eye, can mean literally thousands of dollars
difference  in value. Therefore, the importance of consistent grading, according
to  a universally accepted standard by the marketplace cannot be overemphasized.
In  1986,  the  first uniform grading system was implemented by the Professional
Coin Grading Service  (the  "PCGS").  Silvano DiGenova, the Company's president,
was  a co-founder of PCGS and helped to develop the grading system used by PCGS.
Mr.  DiGenova sold his interest in PCGS in 1987 and has not been affiliated with
PCGS,  except  as a customer of its services, since that time.  A year after the
founding  of  the PCGS, the Numismatic Guaranty Corporation  ("NGC") was formed.
Mr.  DiGenova  is not affiliated with NGC in any way except as a customer of its
services.

These  two  firms  established a uniform coin-grading standard, which has gained
almost  universal  acceptance throughout the world.  Once a coin has been graded
and  certified, both firms encapsulate the coin in tamper-proof acrylic holders,
register them by number, grade, date and mintmark.  If applicable, they identify
variety  and  pedigree as well. Rare coins graded and certified by either one of
these  services  can  now  be  traded  with confidence.  The advent of certified
grading  has  led to another revolution of sorts, the formation of the Certified
Coin  Exchange  (CCE).  Mr.  DiGenova was a founder and board member of CCE, and
helped  to  organize the association.  Mr. DiGenova sold his interests in CCE in
the  late  1980s  and  has not been affiliated with the company in any way since
that  time except as a user of their services.  CCE is a nationwide computerized
trading  network  for  rare  coins.  CCE  is  also  the  number  one  source  of
instantaneous  price  information.  Coins  can  be  bought and sold sight unseen
because  of  the  certification  and confidence instilled in the market place by
CCE,  PCGS  and  NGC.

NUMBER OF EMPLOYEES

As  of  September  30,  2001,  the Company employed 38 persons, of which 35 were
full-time  employees.  The  Company  believes that its future success depends in
part  upon  recruiting  and  retaining qualified numismatists, fine art experts,
marketing  and  other  personnel.

COMPETITION

The business of selling rare coins and other collectibles is highly competitive.
The  Company  competes  with  a  number of smaller, comparably sized, and larger
firms  throughout  the  United  States.  These  include:  Heritage  Rare  Coin
Galleries,  a  large  scale coin firm; National Gold Exchange, a large wholesale
coin and bullion seller ; Spectrum, a subsidiary of Greg Manning Auctions, Inc.,
a publicly traded company; Collectors Universe, Inc., a publicly traded company;
and  U.S.  Coins,  a  medium  size  coin wholesaler; Sotheby's Holdings, Inc., a
publicly  traded  company  and other companies.  These competitors are generally
larger  and better capitalized. However, the Company believes that it is able to
compete  with  these  competitors due to its generally higher quality inventory,
staff expertise, and Web presence.  However, there can be no assurances that the
Company  can  continue  to compete successfully with other established companies
with  greater  financial  resources,  experience  and  market  share.

                                        8
<PAGE>

FLUCTUATION  IN  QUARTERLY  OPERATING  RESULTS

The  Company's  revenues  and operating results have in the past fluctuated, and
may  in  the future fluctuate, from quarter to quarter and period to period as a
result of a number of factors. These include, without limitation, the following:
the  supply  and  demand  of  rare  coins  on  a wholesale and retail basis; the
fluctuation  of  precious  metal  bullion  prices; the pricing policies or price
reductions  by  the  Company  and  its  competitors;  the  Company's  success in
expanding  its sales of rare coins and collectibles at a retail level; personnel
changes;  and  general  economic  trends.

Unlike  many  organizations  with significant retail sales, the Company does not
have  any  predictable  seasonal  sales patterns other than the early spring and
early  fall  periods.  These two periods tend to be somewhat better periods than
other  periods  due  mostly  to  the  traditional  dates  of  major  rare  coin
conventions,  where  the  company  concludes  substantial  business.

Due to all of the foregoing factors, it is possible that in some future quarter,
the  Company's  operating  results  may  be below the expectations of the public
market  analysts  and investors. In such event, the Company's common stock would
likely  be  materially  adversely  affected.

REGULATION

The  rare  coin  and  collectibles  markets  are not currently subject to direct
federal,  state  or  local regulation, although the sales of certain artwork and
autographed sports memorabilia is regulated in some states. However, the Federal
Trade  Commission  and  many  state  attorneys general have shown an interest in
regulating the sales of rare coins and other tangible assets as investments, and
the State of New York has determined that under certain circumstances rare coins
may  be  treated  as  securities  under  state  law, thereby requiring rare coin
dealers  to  register  as  broker-dealers and permitting investors all legal and
equitable  remedies  otherwise  available  to buyers of securities.  The Company
relies upon the February 1998 ruling of U. S. District Court Judge Kimba Wood in
the case of Llewellyn v. North American Trading that the ordinary retail sale of
rare coins to investors is not a security under the federal securities laws, and
believes  that  its  operations  are  not  subject  to regulation as the sale of
securities.  There is no assurance, however, that at some time in the future the
sale  of  rare  coins will be so regulated, and that the Company's business will
not  be  materially  adversely  affected  thereby.

Over  the  past  15  years,  the  FTC has filed suits against numerous rare coin
dealers  alleging  that  the  dealers' representations about coins were false or
misleading to a person of average intellect, or that the dealers' retail markups
were  so  high that their representations about investment risk and appreciation
potential  became  misleading  or untrue. These cases have not, however, created
any  clear  rules  by which dealers such as the Company can assure themselves of
compliance.  On  January 1, 1996, the FTC's Telemarketing Sales Rule, authorized
by  the  1994  Telemarketing  and  Consumer Fraud and Abuse Prevention Act, took
effect.  "Telemarketing"  is  defined  as any plan, program, or campaign that is
conducted  to  induce  payment  for  goods  and services by use of more than one
interstate  telephone  call.  The  Rule  applies  to  all  sales  of "investment
opportunities",  which  is  defined  by whether the seller's marketing materials
generally  promote items. On the basis of representations about "income, profit,
or  appreciation." The Company believes that all of its retail sales are covered
by  the  Rule,  even  those  to  collectors.

The  Telemarketing  Sales  Rule  requires the Company to inform customers of the
following before accepting payment: the number of items being sold, the purchase
price,  and  the  Company's  refund  /  exchange / buyback policy. The Rule also
prohibits  the  Company  from  misrepresenting  the  "risk,  liquidity, earnings
potential,  and  profitability"  of  the  items it sells. This in itself did not
materially  change prior law. However, during debates on the Telemarketing Sales
Rule  in  1995,  FTC  staff  attorneys  tried  to  impose  additional  specific
requirements  that  dealers  in  "tangible  assets" disclose to retail customers
their  actual  cost  for  the  items  they sell, and also disclose "all material
facts"  about  their  goods  before  accepting any money from the customer. This
would  have  required  the  Company to disclose its actual margins to its retail
customers,  as  well  as  impose  on  the  Company  a  near impossible burden of
determining  what  facts  were  material  to  the  purchase  of  coins  or other
collectibles.  Although the FTC ultimately removed these additional requirements
from  the  final  version of the Rule, the FTC staff's behavior demonstrated its
particular  concern  for  telemarketing  of  coins  as  investments. There is no
assurance  that the FTC will not amend the Rule in the future to impose these or
other  additional  regulations,  or  that individual states will not impose such
regulations,  and  that  the Company's business will not be materially adversely
affected  thereby.

In  addition,  many investors favor rare coins because they can be bought, owned
and  sold  privately, i.e., without registering with or notifying any Government
agency.  However,  the Internal Revenue Service now requires dealers such as the
Company to report on Form 8300 all sales of coins in which more than  $10,000 in
cash  or  cash-like  instruments  is used as payment. The private nature of rare
coin  ownership  has  occasionally  resulted  in  rare  coins being purchased by
taxpayers  for the purpose of concealing unreported income, or used to "launder"
income  derived  from  unlawful activities. This has caused local authorities to
consider  imposing  registration  and/or  reporting  requirements upon rare coin
dealers,  although  the  only  such  regulation  enacted to date (in the City of
Chicago) has not been enforced against full-time dealers in rare coins. There is
no assurance that additional regulations will not be imposed upon the Company in
the  future,  and  that  the Company's business will not be materially adversely
affected  thereby.

                                        9
<PAGE>
TAXATION OF MAIL ORDER SALES

The  Company  does  not  collect  California  sales  tax  on mail order sales to
out-of-state  customers,  because interstate sales generally are tax-exempt. Nor
does  the  Company  collect  use  tax  on its interstate mail order sales.  Most
states  impose  a  use tax on "retailer(s) engaged in business in this state" on
sales  of  "tangible personal property for storage, use, or other consumption in
this  state"  (language from '6203 of the California Sales and Use Tax Law). Use
tax  is  usually  set at the same rate as sales tax, and its purpose is to level
the  playing  field  between  local retailers who pay sales tax and out-of-state
mail order companies who do not.  Some states exempt rare coin sales over $1,000
from  sales  or  use  tax,  but  most do not.  Although the federal Constitution
restricts  the right of states to tax interstate commerce, states can assess use
tax-on  any  transaction  where  the out-of-state mail order firm has a "nexus",
i.e.,  any  physical  presence,  in  the  state, regardless of whether the sales
themselves  arise  from  that  local  presence.  "Nexus"  includes  attending
conventions, although at least one state (California) provides a seven-day "safe
harbor"  for out-of-state dealers attending conventions and whose sales are less
than  a  certain  dollar  threshold. It also would include attending auctions or
making buying or selling trips. On that basis, the Company may be deemed to have
"nexus"  in  many  states.

Use  tax  is the buyer's obligation, but states require retailers to collect the
tax  and  remit it to the state along with a use tax return. There is no statute
of  limitations  for  use  tax if the dealer has filed no returns.  To date, the
Company  has  not been assessed for use tax by the taxing authority of any other
state,  nor has it received any inquiry indicating that it was being audited for
purposes of such an assessment.  However, there is no assurance that the Company
will  not  be  audited  by  taxing authorities of the states and be assessed for
unpaid  use  taxes  (plus  interest  and  penalties) for a period of many years.

In  addition  to  use  tax,  many  states  impose  income and franchise taxes on
out-of-state  companies  that  derive  net  income  from  business  with  their
residents.  For  example,  California  applies  an income-based franchise tax to
out-of-state corporations operating in California for the privilege of using the
corporate  form.  The  maximum tax rate is 8.84%, with a minimum tax of $800 per
year.  Income  derived  outside  California is not taxed, and in-state income of
taxpayers  liable  for  tax in more than one state is calculated using a formula
contained in the Uniform Division of Income for Taxation Purposes Act, a statute
in  effect  in Alabama, Alaska, Arizona, Arkansas, California, Colorado, Hawaii,
Idaho,  Kansas,  Kentucky, Maine, Michigan, Missouri, Montana, Nebraska, Nevada,
New Mexico, North Dakota, Oregon, South Carolina, South Dakota, Texas, Utah, and
Washington.  As with use tax, nexus principles apply, and the U.S. Supreme Court
requires  "a minimal connection between the interstate activities and the taxing
state,  and  a  rational relationship between the income attributed to the State
and  the  intrastate  values  of  the  enterprise."

Assuming  the  existence  of nexus, the Company could be subject to income-based
taxes  in  each  of  the  states  in  which  it  has  had a physical presence at
conventions, auctions or otherwise. The only exceptions would be in states where
the  Company  is  protected  by  a  federal law, 15 U.S.C. '381, which immunizes
companies  from  state income taxes if the company's only business activities in
the taxing state consist of "solicitation of orders for interstate sales." There
is no statute of limitations for income or franchise tax if the dealer has filed
no  return.  To  date,  the  Company  has  not  been  assessed for income tax or
franchise  tax  by  the taxing authority of any other state, nor has it received
any  inquiry  indicating  that  it  was  being  audited  for purposes of such an
assessment.  However, there is no assurance that the Company will not be audited
by  taxing  authorities  of  the  states  and  be  assessed for unpaid income or
franchise  taxes  (plus  interest  and  penalties)  for  a period of many years.

                                       10
<PAGE>
ABILITY TO MANAGE GROWTH

The Company has experienced periods of growth, increased personnel and marketing
costs  that  have placed, and may continue to place, a significant strain on the
Company's  resources.  The Company anticipates expanding its on-line auction and
sales  efforts. The Company's ability to manage future increases, if any, in the
scope  of  its  operations  or  personnel  will  depend  on the expansion of its
marketing  and  sales, management and financial capabilities. The failure of the
Company's  management to effectively manage expansion in its business could have
a  material  adverse effect on the Company's business, results of operations and
financial  condition.


MAJOR SUPPLIERS

The  Company  obtains its coins and collectibles from many different individuals
and  entities  and is not dependent on any major suppliers. During the six month
periods  ended  June 30, 2000 and 2001, and for the twelve months ended December
31,  2000,  no  supplier  provided  more  than  10%  of  the Company's aggregate
purchases  of  coins  and  collectibles.

DEPENDENCE ON KEY CUSTOMERS

The  Company  is  not dependent on any key customers but rather sells to a large
variety  of individual retail purchasers as well as several wholesale purchasers
throughout  the  nation  and world.  During the six month periods ended June 30,
2000 and 2001, and the twelve months ended December 31, 2000, the Company had no
customers  that  represented  more  than  10%  of  the  Company's  sales.

PATENTS, TRADEMARKS, LICENSES

The Company does not depend upon any patents, trademarks, or licenses to conduct
its  business;  or  does  the  Company  hold  any  such  patents  or trademarks.

COST OF COMPLIANCE WITH ENVIRONMENTAL REGULATIONS

The Company currently has no costs associated with compliance with environmental
regulations.  However,  there  can  be  no  assurances that the Company will not
incur  such  costs  in  the  future.

ITEM  2  -  DESCRIPTION  OF  PROPERTY

Effective  June  15,  1996, the Company began leasing approximately 4,092 square
feet of administrative and retail space in Laguna Beach, California at a monthly
rental  rate  of $5,000 per month beginning on September 1, 1996.  Until January
2000,  this  facility  served  as  the Company's headquarters and primary retail
location.  The  monthly  rental rate is scheduled to increase in accordance with
the  Consumer  Price  Index on an annual basis, up to a limit of 6% per year but
subject  to  a  3%  minimum  increase.  Subsequent to vacating the premises, the
Company  subleased  the  property  to an unrelated third party. The sublease was
paid and is current through March 31, 2001. The lease was scheduled to terminate
on  June  30,  2001;  however,  the landlord released the Company from the lease
effective  March  31,  2001.

Effective May 1, 1999, the Company began leasing approximately 1,722 square feet
of  administrative  space  in  Tustin,  California  at  a monthly rental rate of
$2,066.40.  Until  January  2000, this facility served as the Company's customer
service  site.  The  lease  terminated  on  April  30,  2000.

Beginning  on June 1, 1999, the Company began leasing approximately 2,350 square
feet  of  retail  space  in Las Vegas, Nevada pursuant to an oral month-to-month
lease  with  Commercial  West Property Management at a rate of $2,023 per month.
The  Company is currently investigating alternative retail locations for its Las
Vegas  operations.  On May 1, 2000, the Company consolidated operations from the
Tustin  office  to  the  Company's  location at Newport Beach and simultaneously
terminated  the  lease  in  Las  Vegas,  Nevada.

Beginning on October 1, 1999, the Company began leasing approximately 180 square
feet of office space in Barrington, Illinois at a monthly rental rate of $592.
This office serves as the Company's Chicago, Illinois buying office. The lease
terminated on September 30, 2000 and the space is being occupied on a
month-to-month basis at the same rental rate per month.

Effective  October  7,  1999,  the  Company  began leasing 11,270 square feet of
administrative,  customer support, retail, gallery, and auction space located in
Newport  Beach,  California  at  a  rental rate of $11,000 per month. In January
2000,  the Company consolidated its Laguna Beach and Tustin operations into this
location.  The  lease was scheduled to terminate on October 7, 2001; however, on
August  28, 2001, the Company extended the lease to expire on September 30, 2004
with  a  monthly rental rate of $11,550 for the year ended September 30, 2002, a
monthly  rate  of $11,896.50 for the year ended September 30, 2003 and a monthly
rate  to  $12,253.40  for  the  year  ended  September  30,  2004.

                                       11
<PAGE>

Effective January 1, 2000, the Company began leasing 2,500 square feet of retail
and  administrative space located in Allentown, Pennsylvania at a rental rate of
$3,000  per month. This location serves as retail storefront and headquarters of
the Company's subsidiary, Keystone. The president and vice president of Keystone
own the location (See Item 12 - Certain Relationships and Related Transactions).
The  lease  is  schedule  to  terminate  on  December  31,  2002.

On  July  6,  2001,  pursuant  to the acquisition of the assets of Superior, the
Company  agreed to the assignment of a lease of approximately 11,000 square feet
of  retail  and  administrative space constituting all of the ground floor space
and  all  of  the  second  floor  space  in a building located in Beverly Hills,
California  at a rental rate of $23,169 per month. Simultaneous to the execution
of  the  assignment,  the  Company  also  executed  a  sublease agreement, which
provides  for the sublease of all of the second floor space, approximately 5,000
square  feet,  to  the seller in the transaction at a rental rate of $9,499. The
assigned  lease  and  the  sublease  expire  on  September  22,  2002.

ITEM  3  -  LEGAL  PROCEEDINGS

The  Company  may  from  time  to  time be involved in various claims, lawsuits,
disputes with third parties, actions involving allegations of discrimination, or
breach  of  contract  actions  incidental  to  the  operation  of  its business.

The Company's wholly owned subsidiary HotelInteractive, Inc. is the defendant in
a  lawsuit  that  alleges breach of contract. The Company's counsel has reviewed
the  case  and without admitting any responsibility, counsel has advised that it
is  probable  that  the  Company's  subsidiary may have a financial liability of
$100,000. Accordingly, the financial statements of the Company have accrued such
amount  to  record  this  contingency.

Other than the lawsuit described above, the Company is not currently involved in
any such litigation, which it believes could have a materially adverse effect on
its  financial  condition  or  results  of  operations.

ITEM  4  -  SUBMISSION  OF  MATTERS  TO  A  VOTE  OF  SECURITY  HOLDERS

On July 25, 2001, shareholders representing 57% of the outstanding shares voted
by majority written consent to amend the Company's articles of incorporation to
increase the authorized common stock from 50,000,000 shares to 100,000,000
shares. Additional details of this transaction may be found in the Company's
filing of Schedule 14C filed with the Securities and Exchange Commission on
August 7, 2001.










                                       12
<PAGE>
                                     PART II

ITEM  5  -  MARKET  FOR  COMMON  EQUITY  AND  RELATED  STOCKHOLDER  MATTERS

The following table sets forth the high and low closing prices for shares of the
Company  Common  Stock  for the periods noted, as reported by the National Daily
Quotation  Service  and  the  NASDAQ  Bulletin  Board.  Quotations  reflect
inter-dealer prices, without retail mark-up, mark-down or commission and may not
represent actual transactions. The trading symbol for the Company's common stock
is  TAGZ.



                            Closing Prices
                                 2001
Quarter Ended :           High         Low
                         -----        -----
March 31                 0.370        0.090
June 30                  0.450        0.100
September 30             0.300        0.170

                                2000
Quarter Ended :           High         Low
                         -----        -----
March 31                 2.375        0.500
June 30                  2.000        0.500
September 30             0.812        0.281
December 31              0.594        0.125


NUMBER OF SHAREHOLDERS

The number of beneficial holders of record of the Common Stock of the company as
of  the  close  of  business  on  October  1,  2001  was  approximately  170.
Approximately  1,504,119 shares of the Company's Common Stock are currently held
in "street name" and consequently reflect numerous additional beneficial owners.

DIVIDEND POLICY

To  date,  the  Company  has declared no cash dividends on its Common Stock, and
does  not expect to pay cash dividends in the near term.  The Company intends to
retain  future earnings, if any, to provide funds for operation of its business.

On  August 24, 2001, the Company issued 110,000 shares of Series A Redeemable 8%
Convertible  Preferred  Stock  (see  "Recent  Sales  of Unregistered Securities"
below).  Pursuant  to the designation of such preferred stock, the Company shall
pay  annual dividends of $0.40 per preferred share in equal quarterly amounts in
cash  or  in  Common  Stock  at the option of the Company. For the quarter ended
September  30,  2001,  the  Company  elected  to pay the dividends of $11,000 in
55,000  shares  of  Common  Stock.

RECENT SALES OF UNREGISTERED SECURITIES

On  June  15, 2001, the Company issued a warrant to purchase 1,500,000 shares of
common  stock of the Company to Silvano DiGenova, the chief executive officer of
the  Company  and  a related party lender, in consideration for the extension of
payment  of the related party notes to December 31, 2004 and for maintaining the
current  interest  rate  throughout  the  extension  period. The issuance was an
isolated transaction made without general solicitation pursuant to the exemption
from  registration  provided  by  Section  4(2)  of  the Securities Act of 1933.

                                       13
<PAGE>

On  June  25,  2001,  the Company completed the acquisition of HotelInteractive,
Inc.,  pursuant  to  which the Company issued 18,755,345 shares of the Company's
"restricted"  common  stock  and  warrants  to  purchase 1,407,587 shares of the
Company's  common  stock  to the former shareholders of HotelInteractive for all
the outstanding common shares of HotelInteractive. The issuance was made without
general  solicitation  pursuant  to  the exemption from registration provided by
Rule  506  Regulation  D  of  the  Securities  Act  of  1933.

On  June  25,  2001,  pursuant  to a financial consulting agreement, the Company
granted  Robert  Escobio,  also a director of the Company, a warrant to purchase
100,000  shares  of  common  stock  of the Company. The issuance was an isolated
transaction  made  without  general  solicitation pursuant to the exemption from
registration  provided  by  Section  4(2)  of  the  Securities  Act  of  1933.

On  June  26,  2001, in connection with the related to the acquisition of HI the
Company  issued  NRLP,  a  related  party  lender, a warrant to purchase 250,000
shares  of  the Company's common stock. The issuance was an isolated transaction
made  without  general  solicitation pursuant to the exemption from registration
provided  by  Section  4(2)  of  the  Securities  Act  of  1933.

On  various  dates  during  the  six  months ended June 30, 2001, and during the
twelve  months ended December 31, 2000, the Company granted to certain employees
and independent contractors 1,735,000 and 1,150,000 stock options, respectively,
to  purchase  common  stock  of  the  Company.  The  issuance  was  an  isolated
transaction  made  without  general  solicitation pursuant to the exemption from
registration  provided  by  Section  4(2)  of  the  Securities  Act  of  1933.

On July 6, 2001, the Company began the offering of a private placement of Series
A  $5.00 Redeemable 8% Convertible Preferred Stock ("Series A Preferred Stock").
The  Series  A  Preferred  Stock  carries  an annual dividend of $0.40 per share
payable  quarterly  in  cash  or  common  stock  of the Company at the Company's
election,  is  convertible  into  11  shares  of  the Company's common stock and
provides  for  cash  redemption  or  conversion into common stock of the Company
based  on  elections by the holder or by the Company with certain contingencies.
As  of  the  date  of this report, the Company has sold $575,000 of the Series A
Preferred  Stock  to  ten  accredited investors and unless otherwise extended in
accordance  with  its  terms, the offering is to close on October 31, 2001. Upon
closing,  the  Company  has  the  obligation to file an appropriate registration
statement with the Securities and Exchange Commission covering all of the common
shares  issuable  in  accordance with the terms of the offering. The issuance of
such shares was made pursuant to an exemption from registration provided by Rule
506  Regulation  D  of  the  Securities  Act  of  1933.

On  July  3,  2001,  the  Company  acquired  all  the  outstanding  shares  of
Vintageroadshow.com,  for  the  total  consideration  of  25,000  shares  of the
Company's  "restricted"  common  stock  to  the  former  shareholders  of
Vintageroadshow.com  for  all  the  outstanding  common  shares  of
Vintageroadshow.com.  The  issuance  was  an  isolated  transaction made without
general  solicitation  pursuant  to  the exemption from registration provided by
Section  4(2)  of  the  Securities  Act  of  1933.

The  Company  declared  a  dividend  to  the  holders  of the Company's Series A
Preferred  Stock  payable in the Company's common stock as of September 30, 2001
in  the  aggregate  amount of 55,000 shares of the Company's "restricted" common
stock.  The  cash value of the dividend was $11,000. The issuance of such shares
was  made  pursuant  to  an  exemption  from  registration  provided by Rule 506
Regulation  D  of  the  Securities  Act  of  1933.


ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF  OPERATIONS

CAUTIONARY  STATEMENTS:

This Annual Report on Form 10-KSB contains certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934.  The Company intends that such
forward-looking statements be subject to the safe harbors created by such
statutes. The forward-looking statements included herein are based on current
expectations that involve a number of risks and uncertainties.  Accordingly, to
the extent that this Annual Report contains forward-looking statements regarding
the financial condition, operating results, business prospects or any other
aspect of the Company, please be advised that the Company's actual financial
condition, operating results and business performance may differ materially from
that projected or estimated by the Company in forward-looking statements.  The
differences may be caused by a variety of factors, including but not limited to
adverse

                                       14
<PAGE>
economic  conditions,  intense  competition,  including intensification of price
competition  and  entry  of new competitors and products, adverse federal, state
and  local  government  regulation,  inadequate  capital,  unexpected  costs and
operating  deficits,  increases in general and administrative costs, lower sales
and revenues than forecast, loss of customers, customer returns of products sold
to  them  by  the  Company,  termination  of  contracts,  loss  of  supplies,
technological  obsolescence  of  the Company's products, technical problems with
the Company's products, price increases for supplies, inability to raise prices,
failure  to  obtain  new  customers,  litigation  and administrative proceedings
involving the Company, the possible acquisition of new businesses that result in
operating  losses  or  that  do  not  perform  as  anticipated,  resulting  in
unanticipated  losses,  the possible fluctuation and volatility of the Company's
operating results, financial condition and stock price, inability of the Company
to  continue  as  a  going  concern,  losses incurred in litigating and settling
cases, adverse publicity and news coverage, inability to carry out marketing and
sales  plans,  loss  or retirement of key executives, changes in interest rates,
inflationary  factors  and  other  specific risks that may be alluded to in this
Annual  Report  or  in  other  reports  issued by the Company.  In addition, the
business  and  operations  of  the Company are subject to substantial risks that
increase  the  uncertainty  inherent  in  the  forward-looking  statements.  The
inclusion  of  forward-looking  statements  in  this Annual Report should not be
regarded  as  a  representation  by  the  Company  or  any other person that the
objectives  or  plans  of  the  Company  will  be  achieved.

The following discussion should be read in conjunction with, and is qualified in
its entirety by, the Consolidated Financial Statements and related notes thereto
included  elsewhere  herein. Historical results of operations, percentage margin
fluctuations  and  any trends that may be inferred from the discussion below are
not  necessarily  indicative  of  the  operating  results for any future period.

As reported on the Company's Current Report on Form 8-K dated July 20, 2001, the
Company  changed  its  fiscal year end from December 31 to June 30, implementing
such  change  for  the  six  months  ended  June  30,  2001.

RESULTS  OF  OPERATIONS

The  following  table  sets  forth  the periods indicated, the percentage of net
revenue  represented  by  each  item in the Company's consolidated statements of
operations.

<TABLE>
<CAPTION>

                                                              Six Months   Twelve Months
                                               Six Months       ended           ended
                                                  ended     June 30, 2000   December 31,
                                              June 30, 2001  (unaudited)       2000
                                               -----------  --------------  -------------
<S>                                            <C>          <C>             <C>
Net sales                                           100.0%          100.0%         100.0%
Cost of sales                                        86.0%           84.3%          84.1%
Gross profit                                         14.0%           15.7%          15.9%
                                               -----------  --------------  -------------
Selling, general and administrative expenses         13.3%           17.5%          18.4%
Income (loss) from operations                         0.7%           -1.8%          -2.5%
                                               -----------  --------------  -------------
Other income (expense)                               -3.0%           -3.1%          -3.0%
Loss before provision for taxes                      -2.3%           -4.9%          -5.5%
                                               -----------  --------------  -------------
Income taxes                                          0.0%            0.1%           0.1%
Net loss                                             -2.3%           -5.0%          -5.6%
                                               -----------  --------------  -------------


</TABLE>

                                       15
<PAGE>

FOR  THE  SIX  MONTHS  ENDED  JUNE  30,  2001  AND  2000

The  Company  recorded  a  net  loss  for  the six months ended June 30, 2001 of
$409,199  or $0.02 per share on both a basic and fully diluted basis as compared
to a loss of $692,544 or $0.04 per share on both a basic and fully diluted basis
for  the  six months ended June 30, 2000, an improvement in operating results of
$283,345  or  $0.02  per share. The narrowing of the net loss for the six months
ended  June  30,  2001  as  compared  to  the six months ended June 30, 2000 was
primarily  a  result  of  increased  sales  and  margins while expenses remained
relatively  constant  for  the  two  comparable  periods.

NET  SALES

The table below sets forth the primary sources of sales of the Company:
<TABLE>
<CAPTION>

                           Six Months ended   Six Months ended   Twelve Months ended
                            June 30, 2001       June 30, 2000     December 31, 2000
                          ------------------ ------------------   -----------------
<S>                       <C>                  <C>                 <C>
NetT sales
  Coins- wholesale          $10,404,793   59%  $ 9,846,877   72%  $19,356,488   66%
  Coins- retail               6,746,182   38%    3,207,779   23%    8,519,773   29%
  Fine and decorative arts      565,060    3%      599,408    4%    1,649,878    6%
                          ------------------ ------------------   -----------------
Total net sales             $17,716,035  100%  $13,654,064  100%  $29,526,139  100%
                          ================== ==================   =================

</TABLE>

The Company recorded sales of $17,716,035 for the six months ended June 30, 2001
an  increase  of  $4,061,971  or  30%  over the sales of $13,654,064 for the six
months  ended  June  30,  2000. Wholesale coin sales increased by $557,916 or 6%
from  $9,846,877  for  the six months ended June 30, 2000 to $10,404,793 for the
six  months  ended June 30, 2001. Of net sales, wholesale coin sales contributed
59% of such net sales for the six months ended June 30, 2001, as compared to 72%
of  such  net  sales  for  the six months ended June 30, 2000. Retail coin sales
increased  from  $3,207,779 for the six months ended June 30, 2000 to $6,746,182
for  the six months ended June 30, 2001, an increase of $3,538,403 or 110%. With
respect  to  net sales, retail coin sales were 38% and 23% of such net sales for
the  six  months ended June 30, 2001 and 2000, respectively. Fine and decorative
art  sales  declined by $34,348 or 6% from $599,408, or 4% of net sales, for the
six  months  ended  June  30,  2000 to $565,060, or 3% of net sales, for the six
months  ended  June  30,  2001. The increase in coin sales at both wholesale and
retail  of $4,096,319 was primarily a result of the consolidation of the results
of  operations of Tangible Collectibles, Inc. ("TCI"), a wholly owned subsidiary
formed  in  November  2000.  TCI  is  substantially  in the same business as the
Company,  however, the added trading capacity provided by TCI resources provided
the  Company with the additional ability to increase sales both in wholesale and
retail  coins  with entirely new customers or in some cases, by additional sales
to  existing  customers.

COST  OF  SALES

Cost of sales for the Company increased from $11,515,986, or 84% of net sales to
$15,237,437  or 86% of net sales, an increase of $3,721,451, or 32%, for the six
months  ended June 30, 2001 and 2000, respectively. By comparison, the net sales
increased  from  $13,654,064 to $17,716,035,  an increase of $4,061,971, or 30%,
for the six months ended June 30, 2001 and 2000, respectively. The lower margins
were attributable primarily to (a) slightly lower retail prices in the rare coin
markets,  thereby  reducing the margins the Company experienced in prior periods
and  (b) the margins for TCI, a subsidiary consolidated into results for the six
months ended June 30, 2001 but not in such results for the six months ended June
30,  2000,  generally has lower margins than the Company. When the lower margins
of  TCI are blended into the higher margins of the Company by consolidation, the
resulting  percentage  of  cost  of  sales  as  a  percentage of sales is lower.


                                       16
<PAGE>

GROSS  PROFIT

Gross  profit  increased  $340,520,  or  16%, from $2,138,078 for the six months
ended  June  30,  2000  to  $2,478,598  for  the six months ended June 30, 2001.
Notwithstanding  this  increase in gross profit, sales increased 30% for the six
months  ended  June  30,  2001 as compared to the six months ended June 30, 2000
while gross profit increased by 16% for the same comparable periods, while gross
profit measured as a percentage of net sales decreased from 16% of net sales for
the  six months ended June 30, 2001 to 14% of net sales for the six months ended
June  20,  2000. This decrease in gross profit as a percentage of net sales from
the  six  months  ended  June  30, 2000 to the six months ended June 30, 2001 is
primarily  related to (i) slightly lower retail prices in the rare coin markets,
thereby  reducing  the margins the Company experienced in prior periods and (ii)
the  margins  for TCI, a subsidiary consolidated into results for the six months
ended  June  30,  2001 but not in such results for the six months ended June 30,
2000,  generally  has  lower margins than the Company. When the lower margins of
TCI  are  blended  into  the higher margins of the Company by consolidation, the
resulting  percentage  of  cost  of  sales  as  a  percentage of sales is lower.

SELLING,  GENERAL  AND  ADMINISTRATIVE  EXPENSES

The  Company recorded selling, general and administrative expenses of $2,343,474
for  the  six months ended June 30, 2001, a decrease of $49,725, or 2%, over the
same  accounts  for the six months ended June 30, 2000, while sales for the same
comparable  periods  increased 30%. When compared to sales, the selling, general
and  administrative  expenses were decreased 5%, from 18% of net sales to 13% of
net  sales  for  the six months ended June 30, 2001 and 2000, respectively.  The
increased  efficiency in these expenses is indicative of cost control applied by
management and the ability of management to expand operations to include a wider
base  of  sales  and  an additional subsidiary for the six months ended June 30,
2001  as  compared  to  the  six  months  period  ended  June  30,  2000 without
significantly  increasing  fixed  operating  costs.  This  increase in operating
leverage of the fixed operating costs is a central principle in the future plans
of  the  Company as the Company continues to grow by acquisition and development
of  expanded  sales  operations,  although there is no assurance the Company can
continue  with  this  degree  of  success  in  utilizing  fixed  costs.

OTHER  INCOME  AND  EXPENSES

For  the  six  months ended June 30, 2001, other income and expense increased to
$540,473  from  $422,423 for the six months ended June 30, 2000. The increase is
almost  exclusively  as  a  result  of  the  increase  in interest expense which
increased  from  $424,684 to $562,017 for the six months ended June 30, 2001 and
2000, respectively. This increase in interest expense is attributable to the use
of  non-traditional financing sources by the Company as the commercial bank line
of  credit  was  reduced  by agreement with the bank from $1,840,000 at June 30,
2000  to  a  balance  of  $1,040,000  at  June 30, 2000, a decrease of $800,000.

PROVISION  FOR  INCOME  TAXES

Although  the  Company had a net loss for the six months ended June 30, 2001 and
2000,  the  provision for income tax was $3,850 and $15,000, respectively due to
state  and local taxes and other minimum taxes. For federal income tax purposes,
the  Company  has  a  net  operating  loss  carryforward of $2,485,000, which is
available  to  offset  future  federal  taxable  income through 2021.  For state
income  tax  purposes, the Company also has a net operating loss carryforward of
$1,050,000,  which  is  available  to  offset state taxable income through 2006.

LIQUIDITY  AND  CAPITAL  RESOURCES

Cash increased $220,803 from $5,622 at December 31, 2000 to $226,425 at June 30,
2001.  Cash  of  $707,270  was  acquired in the acquisition of HotelInteractive,
Inc.,  an acquisition completed on June 25, 2001. Working capital decreased from
$2,411,545  at  December  31, 2000 to $1,003,589 at June 30, 2001, a decrease of
$1,407,956.  This  decrease  in  working  capital  was primarily a result of the
maturity of a note in the amount of $1,400,000 to the Chief Executive Officer, a
related  party,  coming due within one year with such due date of June 30, 2002.
Current  assets increased from $8,856,407 on December 31, 2000 to $10,288,977 at
June  30, 2001, an increase of $1,432,570 or 16%. This increase is primarily due
to the increase in inventory of $870,860 for the six months ended June 30, 2001,
an increase of 11% in inventory over the inventory balance at December 31, 2000.
Current liabilities increased from $6,444,862 to $9,285,388 at December 31, 2000
and  June  30, 2001, respectively, an increase of $2,840,526 from the balance at
December  31,  2000  over the balance at June 30, 2001, primarily as a result of
the increase in the current maturity of the related party note of $1,400,000 and
an  increase in accounts payable of $1,557,526 for the same comparable dates. As
a  result  of  the HotelInteractive acquisition, the Company acquired net assets
with  a  fair  value  of  $3,497,928.

                                       17
<PAGE>

over  the balance at June 30, 2001, primarily as a result of the increase in the
current  maturity  of  the  related  party note of $1,400,000 and an increase in
accounts payable of $1,557,526 for the same comparable dates. As a result of the
HotelInteractive  acquisition, the Company acquired net assets with a fair value
of  $3,498,928.

Operations  for  the  six  months ended June 30, 2001 provided cash of $158,410,
primarily  consisting  of  the  cash  provided  by  the net increase in accounts
payable  over  the  cash  used  in  the  net  increase in inventory and accounts
receivable, which is reflective of the increased net sales and business activity
for the six months ended June 30, 2001. Operations for the six months ended June
30,  2000  required  cash of $205,907, primarily reflecting the cash used in the
net  loss  and  the  net  increase  in  inventory after cash provided by the net
increase  of  accounts  payable.  During  the six months ended June 30, 2001 and
2000,  non-cash  operating  expenses  were  $101,002 and $100,988, respectively.
Property  and  equipment purchased in the six months ended June 30, 2001 were in
the  aggregate  $6,413 and for the six months ended June 30, 2000 such purchases
were in the aggregate $143,504, an decrease of $137,091 exhibiting the fact that
the  Company  was able to expand operations during the six months ended June 30,
2001  without  significant  investment  in  fixed  assets.

FINANCING  ACTIVITIES

On  August  30, 1999, the Company obtained a $2,000,000 line-of-credit agreement
with  a  bank  that bore interest at the bank's prime rate, plus 1.5% (10.25% at
December  31, 1999).  The line-of-credit agreement was renegotiated on April 30,
2000  and renegotiated again on October 31, 2000, lowering the maximum principal
amount  under  the  line-of-credit to $1,840,000 and expiring on April 28, 2001.
The  renegotiated  line-of-credit  bears interest at the bank's prime rate, plus
2.50%  (12.00%  at December 31, 2000) and is collateralized by substantially all
of  the  assets of the Company and the personal guarantee of the Company's chief
executive  officer  and  principal  stockholder. The renegotiated line-of-credit
also  required  monthly  principal payments equal to $50,000 per month for three
consecutive  months  and  $75,000 per month for two consecutive months. On April
28, 2001, the Company renegotiated the line-of-credit to expire on June 29, 2001
and  to  provide  for  principal payments of $100,000 per month with a principal
reduction  of $400,000 at May 31, 2001 and the remaining balance due at June 29,
2001. On June 29, 2001, the line-of-credit was renegotiated to expire on January
31, 2002 with principal payments of $100,000 per month and the remaining balance
due  on  the  expiration  date.

The  Company  will  need  to seek a replacement lender to finance the short term
liquidity needs of the Company's operations.  There can be no assurance that the
Company  will  locate  a  lender  to  provide funding on terms acceptable to the
Company.

On  November 16, 2000, the Company, through its wholly owned subsidiary Tangible
Collectibles,  Inc.  executed a convertible loan and security agreement in favor
of  National  Recovery Limited Partnership ("NRLP") in the amount of $1,000,000,
payable  on  demand  at  an  annual  interest  rate of 13.5% (payable monthly in
arrears),  with  origination  fees of 1.5% of the original principal amount, and
secured  by  the  inventories  of  TCI  and  guarantees from the Company and the
Company's  principal  stockholder  and  chief  executive  officer.  The  loan is
convertible,  at  any  time  and  at the sole option of NRLP, into the Company's
common shares in two blocks of $500,000.  The first $500,000 is convertible into
666,666  common  shares  and  the remaining $500,000 is convertible into 500,000
common  shares.  The  agreement  provides for additional compensation to NRLP in
the  form  of  profit  sharing  calculated  as 25% of TCI's income before income
taxes,  as  defined.  NRLP  also received warrants to purchase 250,000 shares of
common stock of the Company at a price of $0.375 per share with an expiration of
three  years  from  the  date  of  issue.  See  Related  Party  Transactions.

As  of  December 31, 2000, the Company executed a note and security agreement in
favor  of the Company's principal stockholder and chief executive officer in the
amount  of  $1,400,000  to  replace  a  note payable of the same amount and also
payable to the Company's principal stockholder with an original interest rate of
9%  and  convertible to common stock at $1.00 per share. The note has a maturity
date  of  June  30,  2002,  bears  interest  at  9.5%  annual  for three months,
increasing  to  12.5%  annually  for  the duration of the note (interest payable
monthly in arrears) and is convertible into common stock of the Company at $0.22
per  share.

As  of  December 31, 2000, the Company executed a note and security agreement in
favor  of the principal stockholder and chief executive officer in the amount of
$959,440  to  replace  a note payable of the same amount and also payable to the
Company's  principal stockholder. The note had a maturity date of June 30, 2002,
and bears interest at 9.5% annual for three months, increasing to 12.5% annually
for the duration of the note (payable monthly in arrears). On June 15, 2001, the
maturity  date  of the note was extended to December 31, 2004 with no change sin
interest  rate from the annual rate of 12.5%. In consideration of the extension,
the Company issued a warrant to purchase 1,500,000 shares of the common stock of
the  Company  to  the  holder  of  the  note, the chief executive officer of the
Company,  at  an  exercise  price  of  $0.39  per  share with an exercise period
expiring  on  December  31,  2004.  See  Related  Party  Transactions.

                                       18
<PAGE>

On  June  25,  2001,  the Company completed the acquisition of HotelInteractive,
Inc.,  pursuant  to  which the Company issued 18,755,345 shares of the Company's
"restricted"  common  stock  and 1,407,587 warrants too purchase common stock of
the  Company  to  the  former  shareholders  of  HotelInteractive  for  all  the
outstanding  common shares of HotelInteractive. Pursuant to the acquisition, the
Company received $3,498,928 fair value in assets acquired, including $707,270 in
cash  and  assumed  $344,230  in  liabilities.

The  Company  relies  on short term debt to provide adequate working capital for
the  Company's  business,  However,  there can be no assurances that the Company
will be able to secure adequate working capital financing or any other financing
suitable  for  the purposes of the Company at prices which the Company will deem
to  be  acceptable  to  the  Company.

The  Company  has incurred losses since July 1999 and the line of credit expires
in  January  2002.  In  addition,  the Company is dependent on substantial short
term  and  due  on  demand  financing  from various vendors, related parties and
retail  customers.  In  order to fund present and future operations, the Company
needs  to  secure  a  new  line  of  credit, secure long term financing or raise
additional  funds  through private equity or debt placements.  As of the date of
this  report,  the  Company  has  raised  $575,000  in additional equity capital
although  this  equity  capital  may  be  insufficient  to permit the Company to
execute  its  operating plan. While the Company has initiated plans to return to
profitability  and  to  secure  additional  financing and/or to raise additional
capital,  there  are  no  assurances  that  the  Company  will  be successful in
completing  these  critical  tasks.  If  the  Company  is unable to successfully
complete  these critical tasks, it may be forced to reduce its operations and/or
liquidate  inventory  at  amounts  below  current carrying value to generate the
necessary  working  capital  to  fund  its  operations.

EFFECT  OF  NEW  ACCOUNTING  PRONOUNCEMENTS

On  June  29,  2001,  the  Financial  Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards, No. 142 ("SFAS 142"), "Goodwill and
Other  Intangible  Assets."  SFAS 142 supercedes APB Opinion No. 17, "Intangible
Assets,"  and  requires  goodwill  and  other  intangible  assets  that  have an
indefinite  useful life to no longer be amortized. However, these assets must be
reviewed at least annually for impairment. SFAS 142 will be effective for fiscal
years  beginning  after  December  15,  2001.  Early  adoption  is permitted for
companies  with  a  fiscal  year  beginning  after  March  15, 2001.  Due to the
complexity  of  this  new  standard  and  its  recent  issuance,  the Company is
currently  evaluating  the  impact  of  SFAS  142  on the financial position and
statement  of  operations.

In June 2000, the Financial Accounting Standards Board ("FASB") issued Statement
of  Financial  Accounting  Standards  ("SFAS")  No.  138 "Accounting for Certain
Derivative  Instruments  and  Certain Hedging Activities," which amends SFAS No.
133,  "Accounting  for Derivative Instruments and Hedging Activities."  SFAS No.
133  was  previously  amended  by  SFAS  No.  137,  "Accounting  for  Derivative
Instruments  and  Hedging  Activities  -  Deferral of the Effective Date of FASB
Statement  No.  133,"which deferred the effective date of SFAS No. 133 to fiscal
years commencing after June 15, 2000.  The Company currently does not engage in,
nor  does  it  expect  to  engage  in,  derivative  or  hedging  activities and,
accordingly, the Company anticipates there will be no impact to its consolidated
financial  statements.

Staff Accounting Bulletin ("SAB") No. 101, "Revenue Recognition", summarizes the
Securities  and  Exchange  Commission's  views  on  applying  generally accepted
accounting  principles  to  revenue  recognition  in  financial  statements.
Significant  views  addressed  relate to shipping terms, customer acceptance and
bundled service contracts.  Implementation is effective for the first quarter of
fiscal 2001.  The Company believes that its current revenue recognition policies
comply  with  SAB  No.  101.

In March 2000, the FASB issued Interpretation No. 44 ("FIN 44"), "Accounting for
Certain  Transactions  Involving  Stock  Compensation,"  which addresses certain
accounting  issues  that  arose  under  the  previously  established  accounting
principles  relating  to  stock-based  compensation.  The  adoption  of  this
interpretation  did  not  have  a  material  effect  on  the Company's financial
position  or  results  of  operations.

                                       19
<PAGE>

RISK  FACTORS

OUR BUSINESS OF SELLING PREMIUM COLLECTIBLES IS HIGHLY COMPETITIVE.

The business of selling coins, works of art and other collectibles to retail and
wholesale  consumers  and  at  auction is highly competitive.  We compete with a
number  of  comparably sized, smaller firms, as well as a number of larger firms
throughout  the United States.  Our competitors include (without limitation) the
following:  Heritage  Rare  Coin,  a  large  scale  coin  firm in Dallas, Texas;
National  Gold  Exchange,  a  large wholesale coin and bullion seller located in
Tampa,  Florida;  Superior  Stamp  &  Coin,  a medium sized coin firm in Beverly
Hills,  California;  Spectrum,  medium  sized coin wholesaler located in Newport
Beach,  California;  Collectors  Universe,  Inc., a publicly traded company; and
U.S.  Coins,  a  medium  sized coin wholesaler located in Houston, Texas.  These
competitors  have  the  ability  to  attract  customers  as  a  result  of their
reputation  and  the  quality  collectibles  they  obtain through their industry
connections.  Additionally,  other  reputable  companies  that  sell  or auction
collectible  coins  and  artwork may decide to enter our markets to compete with
us.  These  companies  have  greater name recognition and have greater financial
and  marketing  recourses than we do.  If these auction companies are successful
in  entering  the  specialized  market  for  premium  collectibles  in  which we
participate  or  if dealers and sellers participate less in our auctions, we may
attract  fewer buyers and our business could be harmed due to decreased revenue.

MARKET CONDITIONS AFFECT THE AMOUNT SPENT ON RARE COINS, DECORATIVE ARTS AND
PREMIUM COLLECTIBLES.

A  decline  in  consumer  spending could harm our business. Sales of rare coins,
fine  and  decorative  art  and  collectibles  depend  on discretionary consumer
spending  and  are  affected  by  general market conditions. Many factors affect
discretionary  consumer  spending,  including  the  unemployment  rate, business
conditions,  interest  rates,  inflation and tax rates. Spending on the types of
luxury  items  that we typically auction are impacted by these factors more than
sales  of  consumer  products  in  general.

Some  of  the  market conditions that could cause the dollar volume spent in our
auctions  to  decrease  include  the  following:

-     fewer  works  of  art  offered  for  sale;
-     decline  in  the  prices  buyers  are  willing  to  pay;  and
-     shifts  in  consumer  trends.

As  buyers'  tastes change and economic conditions fluctuate, the supply, demand
and  dollar  volume  of  fine  and  decorative  art and collectibles sales could
decrease,  which could have a material adverse effect on our business, operating
results  and  financial  condition.

A DECLINE IN THE POPULARITY OF RARE COINS AND ARTWORK COULD AFFECT OUR BUSINESS
MATERIALLY AND ADVERSELY.

The  popularity  of  rare-coins  and artwork may vary over time due to perceived
scarcity,  subjective  value,  general consumer trends, changes in the prices of
precious metals, interest rates and other general economic conditions. We derive
a  significant  portion  of  our  revenues  from fees paid by collectors for our
appraisal  and  related  services,  commissions  paid  to  us  on  the  sale  of
collectibles in our auctions and sales of collectibles from our own inventory. A
decline  in popularity of rare-coins and artwork, and of collectibles generally,
likely  would  cause  a  decrease  in  the  number of items that we are asked to
appraise and the number of transactions in our auctions and fewer sales from our
inventory,  which  would  reduce  our  revenue  and  harm  our  business.

TEMPORARY  POPULARITY  OF CERTAIN COINS AND ARTWORK AND OTHER COLLECTIBLES COULD
CAUSE  OUR  REVENUES  TO  FLUCTUATE.

Temporary consumer popularity or "fads" among collectors temporarily may inflate
the  volume of collectibles that we appraise, auction and sell. These trends may
result  in significant fluctuations in our operating results from one quarter to
the next. Any decline in the popularity of the collectibles we appraise, auction
and sell as a result of changes in consumer trends could harm our business.  See
"  -  Our  quarterly operating results may vary, which may cause volatility or a
decline  in  the  price  of  our  Common  Stock."

OUR  SUCCESS  DEPENDS  ON OUR MANAGEMENT TEAM AND OTHER KEY PERSONNEL, INCLUDING
PERSONS  WHO HAVE ONLY RECENTLY STARTED WORKING TOGETHER IN OUR RAPIDLY EVOLVING
INDUSTRY.

Our  success  and  future  performance  depends on the continued services of our
senior  management  and  other  key  personnel,  including persons who have only
recently started working together in the rapidly evolving collectibles industry.
The  loss of the services of any of our senior management or other key personnel
could  harm  our business.  Some of our executive officers and key employees are
experts  in  the  market  for  premium  collectibles  and  have  reputations for
purchasing  and  appraising collectibles and for preparing auctions that will be
attractive to buyers of premium collectibles. In particular, the services of our
Chief  Executive  Officer Silvano DiGenova and President Michael Haynes would be
difficult  to  replace. Although our executive management team has experience in
operating  businesses  engaged  in  the  sale  of  rare  coins and other premium
collectibles,  due  to the changing nature of our industry, it is more difficult
to  assess  and evaluate management in our evolving industry than it is in other
industries.

                                       20
<PAGE>

OUR  QUARTERLY  OPERATING  RESULTS  MAY  VARY,  WHICH  MAY CAUSE VOLATILITY OR A
DECLINE  IN  THE  PRICE  OF  OUR  COMMON  STOCK.

Our  revenue, expenses and operating results may vary significantly from quarter
to  quarter  due  to  a  number of factors, not all of which are in our control.
These  factors  include  (without  limitation):

-     the  supply  and  demand  of  rare coins in wholesale and retails markets;
-     consumer  trends  affecting  the  popularity  of  coins, artwork and other
      collectibles  that  we  auction  and  sell  from  time  to  time;
-     fluctuations  in  the  price  of  precious  metals;
-     our  success in expanding our retail sales of rare coins and collectibles;
-     personnel  changes;
-     our  inability  to  maintain  customer  satisfaction;
-     the  size  and  timing  of capital expenditures and other costs associated
      with  the  expansion  of  our  business  and  infrastructure;
-     our  inability  to  resell  our inventory of rare coins, artwork and other
      collectibles  in  a  timely  manner;
-     price  competition  or  changes  in  our  pricing policies or those of our
      competitors  and  pricing  changes  in  our  industries;
-     our  inability  to  maintain  gross  margins;
-     the  availability  and  cost  of  financing  to  continue and complete our
      expansion  and  the  development  of  our  on-line  business;
-     our  success  in  expanding  our  sales  and  distribution  channels.

Additional  factors  that  may  affect our quarterly operating results generally
include  technical  difficulties  or  network  downtime  and  general  economic
conditions  and  economic  conditions  specific  to  our  industries.

OUR  OPERATING  RESULTS  ARE  SENSITIVE PARTICULARLY TO FLUCTUATIONS IN REVENUE.

Because  we  will  rely  on  revenue  forecasts when committing to a significant
portion  of  our future expenditures, we may be unable to adjust our spending in
the  event  of  revenue  shortfalls.  Consequently, such shortfalls could affect
materially  and  adversely  our  business,  financial  condition  and  operating
results.  We  also  plan on increasing our operating expenditures to finance the
cost  of  our  expansion  and to fund our expanding sales and marketing efforts,
general  and administrative activities and to strengthen our infrastructure.  To
the extent that these expenses are not accompanied by a commensurate increase in
revenue,  our  quarterly  results  could  fluctuate significantly in the future.

DUE  TO  THE  FACTORS NOTED ABOVE AND THE OTHER RISKS DISCUSSED IN THIS SECTION,
YOU  SHOULD  NOT  RELY ON PERIOD-TO-PERIOD COMPARISONS OF OUR OPERATING RESULTS.

Quarterly results are not necessarily meaningful and you should not rely on them
as  an  indication  of  future  performance.  It is possible that in some future
periods  our  operating  results  may be below the expectations of public market
analysts  and  investors.  In  that case, the price of our Common Stock may fall
substantially.

WE  MAY REQUIRE SUBSTANTIAL AMOUNTS OF CAPITAL IN ORDER TO ACCOMPLISH OUR FUTURE
PLANS.

Since  the  business  is  driven  by increases in inventory and receivables, the
Company  may  require  substantial  amounts  of  capital in order to achieve and
accomplish  its future business plans. Although management currently has capital
raising  efforts  in  progress, there is no assurance that the Company can raise
sufficient  capital  to  adequately  fund future growth at a price that would be
acceptable  to  management  at  the  shareholders.

                                       21
<PAGE>

OUR  INABILITY TO MANAGE GROWTH EFFECTIVELY COULD AFFECT OUR BUSINESS MATERIALLY
AND  ADVERSELY.

Tangible is experiencing a significant period of growth and increased personnel,
marketing  and  acquisition  related  costs,  and  we  anticipate  that  further
expansion  will be required to address potential growth in our customer base and
market opportunities.  This expansion has placed, and we expect it will continue
to  place,  a  significant  strain  on our management, operational and financial
resources.  Tangible's  ability to manage future increases, if any, in the scope
of its operations or personnel will depend on the expansion of its marketing and
sales,  management,  operational  and  financial  capabilities.  The  failure of
Tangible's  management to effectively manage the expansion of its business could
have a material adverse effect on Tangible's business, results of operations and
financial  condition.  To  manage  this  growth  we  must  do  the  following:
-     establish  and  develop  operational,  financial  and  management systems;
-     train,  manage  and  motivate  our  growing  employee  base;
-     hire  additional  technology  and  operations  personnel;  and
-     hire  additional  fine  art  and  other  specialists  and  appraisers.

We  may  be  unable  to complete the improvements to our systems, procedures and
controls  necessary  to  support  our  future  operations in a timely manner. In
addition,  we  may  be  unable  to attract or retain required personnel, and our
management  may  be  unable to develop an effective business strategy to support
our continued growth and expansion. Any failure to manage our growth effectively
would  have a material adverse effect on our business, results of operations and
financial  condition.

If  additional  appropriate  opportunities present themselves, we also intend to
acquire businesses, technologies, services or products that we believe will help
us  develop  and  expand  our  business.  The process of integrating an acquired
business,  technology,  service  or product may result in operating difficulties
and expenditures that we cannot anticipate and may absorb significant management
attention  that  would  otherwise  be  available  for further development of our
existing  business.  Moreover,  the  anticipated benefits of any acquisition may
not  be  realized.  Any  future  acquisition  of other businesses, technologies,
services  or  products  might  require  us  to  obtain additional equity or debt
financing,  which might not be available to us on favorable terms or at all, and
might  dilute  the interests of our existing stockholders.  Additionally, we may
be  unable to identify, negotiate or finance successfully future acquisitions or
to  integrate  acquisitions  with  our  current  business.

FROM  TIME  TO  TIME,  WE  MAY  DEPEND  ON A SMALL NUMBER OF KEY CUSTOMERS FOR A
SUBSTANTIAL  PORTION  OF  OUR  REVENUE.

Although no single customer represents more than 10% of our net sales, at times,
we  may  depend  on a small number of key customers for a substantial portion of
our  sales  and revenue. The loss of any such key customer could have a material
adverse  effect  on  our  business.

WE  MAY  INCUR  LOSSES  AS  A  RESULT  OF  ACCUMULATING  INVENTORY.

In  addition  to  auctioning  premium collectibles on consignment, a substantial
portion  of  the aggregate sales price of rare coins, artworks and other premium
collectibles  that  we  sell  are  from  our  own  inventory.  We purchase these
collectibles  from  dealers  and  collectors  and assume the inventory and price
risks  of  these  items  until  they  are sold.  If we were unable to resell the
collectibles  that  we purchase when we want or need to, or at prices sufficient
to generate a profit on their resale, or if the market value of our inventory of
purchased  collectibles  were to decline, our revenue could decline, which could
have  a material adverse effect on our business, operating results and financial
condition.

THE  SUPPLY  OF  COLLECTIBLES  IS  LIMITED  AND  OUR INABILITY TO OBTAIN PREMIUM
COLLECTIBLES  FOR RESALE AND FOR SALE AT AUCTIONS COULD MATERIALLY AND ADVERSELY
AFFECT  OUR  BUSINESS.

Our  business depends substantially on our ability to obtain rare coins, artwork
and  other  premium  collectibles for appraisal, sale and auction.  We depend on
the  availability  of premium collectibles through dealers and collectibles, and
we  can  provide no assurance that collectibles will continue to be available as
before.  Although  we deal with numerous dealers and collectors from whom we are
able  to  obtain  collectibles  for  resale and for our auctions, only a limited
number  of  dealers  exist  with the capacity to supply premium collectibles for
resale  and  auction  on  a  regular  basis.  A change in our relationships with
suppliers  or  dealers  could impact negatively our ability to obtain, resell or
auction  premium  collectibles  in the quantities and at the times we desire.  A
shortage  in  the  supply  of  collectibles  could impair our ability to attract
customers,  which  would  harm  our  business,  operating  results and financial
condition.

                                       22
<PAGE>

OUR  AUCTION  OPERATIONS  MAY  NEVER  BECOME  PROFITABLE.

Our  future  operating  results  also  depend  on  the  success  of  our auction
operations  and  the  amount  of  resources  that  we will need to devote to the
development  of  our Internet website.  Our auction operations currently are not
profitable  and it is too premature to predict the profitability of the Superior
acquisition  and  its impact on our auction operations.  We will need to achieve
significant  growth in our Internet business in order for our auction operations
to  become profitable.  We are in the early stages of development of several new
portions  of  our  website that will offer content and auctions for collectibles
that may have a lower average selling price than many of the collectibles in the
markets  we  currently serve.  Continued development of our website will require
significant  resources.  The  planned expansion of our website may not result in
increased  revenue,  which  could  increase  losses  and  harm  our  business.

OUR  OPERATING  RESULTS  COULD  BE  HARMED  IF  WE  EXPERIENCE  AN  INCREASE  IN
RESCISSIONS  OF  SALES.

Our operating results could suffer if we experience a significant increase in
the number of sales that are rescinded due to questions about title, provenance
or authenticity of an item. We warrant the title, provenance and authenticity of
each item that we sell, including items sold at auction. If the buyer believes
that any of these characteristics is in doubt, he or she must notify us in
writing within a certain number of days after the date of sale of the property.
If we cannot substantiate the questioned characteristics, the buyer may rescind
his or her purchase and we will refund the price paid at auction to the buyer.
When a purchase is rescinded, the seller is required to refund the hammer (the
price for which an item sells) less sellers' commissions and other sellers'
fees.

OUR WEB SITE MAY NOT BE ADEQUATE TO MEET THE GROWING NEEDS OF OUR BUSINESS.

The  satisfactory  performance,  reliability  and  availability of our Web site,
particularly  our  Web  site  associated  with the operations of HI, and network
infrastructure  are  and  will  be critical to our reputation and our ability to
attract  and  retain  customers and technical personnel and to maintain adequate
customer service levels.  Any system interruptions or reduced performance of our
Web  site could materially adversely affect our ability to attract new customers
and  technical  personnel.

OUR  WEB  SITE  MAY BE VULNERABLE TO SECURITY BREACHES AND SIMILAR THREATS WHICH
COULD  RESULT  IN  OUR  LIABILITY  FOR  DAMAGES  AND  HARM  TO  OUR  REPUTATION.

Despite  the  implementation  of  network  security  measures, our Web site, and
particularly the Web site associated with the operations of HI, is vulnerable to
computer  viruses,  break-ins and similar disruptive problems caused by Internet
users.  These  occurrences  could  result  in our liability for damages, and our
reputation  could suffer.  The circumvention of our security measures may result
in  the  misappropriation  of  such  proprietary information.  Any such security
breach  could  lead  to interruptions and delays and the cessation of service to
our  customers  and  could  result  in  a  decline  in  revenue  and  income.

ITEM  7  -  FINANCIAL  STATEMENTS

The  consolidated  financial statements and corresponding notes to the financial
statements  called  for by this item appear under the caption Index to Financial
Statements  (Page  F-1  hereof).

ITEM  8  -  CHANGES  IN  AND  DISAGREEMENTS  WITH  ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL  DISCLOSURE

On March 27, 2001, BDO Seidman, LLP resigned as the Company's independent public
accountant  as  described in the Company's Current Report on Form 8-K filed with
the  Commission  on  April 2, 2001.  The audit report of BDO Seidman, LLP on the
consolidated  financial  statements  of the Company as of and for the year ended
December 31, 1999, did not contain any adverse opinion or disclaimer of opinion,
nor  were they qualified or modified as to audit scope or accounting principles.

                                       23
<PAGE>

The decision to change accountants was not approved by the board of directors of
the  Company.

During the period of BDO Seidman, LLP's engagement and during the Company's most
recent  fiscal  year  and  any  subsequent  interim  period  preceding  their
resignation,  there  were  no  disagreements  with the former accountants on any
matter of accounting principles or practices, financial statement disclosure, or
auditing  scope  or  procedure,  which  disagreements,  if  not  resolved to the
satisfaction of the former accountants, would have caused them to make reference
to  the  subject  matter  of  the disagreements in connection with their report.

In  their  letter of resignation, BDO Seidman LLP, stated that on March 23, 2001
they withdrew from the performance of their fieldwork procedures with respect to
their audit of the Company's consolidated financial statements as of and for the
year ended December 31, 2000, as they believed that the books and records of the
Company  were  not  in  an "auditable state" and would not be so in a reasonable
amount of time.  Management of the Company disagreed with BDO Seidman in regards
to  the  state  of  the  books  and  records.

On April 2, 2001, the Company engaged Haskell & White LLP as its new independent
accountants.  The  Company  did  not  consult  with  Haskell  & White LLP on any
matters  prior  to  their  retention.

                                    PART III

ITEMS  9  -  DIRECTORS,  EXECUTIVE  OFFICERS,  PROMOTERS  AND  CONTROL  PERSONS;
COMPLIANCE  WITH  SECTION  16  (A)  OF  THE  EXCHANGE  ACT

This  item  is  incorporated  by  reference  to  the  Company's Definitive Proxy
Statement  on  Schedule 14A which will be filed with the Securities and Exchange
Commission  on  or  before  October  29,  2001.

ITEM  10  -  EXECUTIVE  COMPENSATION

This  item  is  incorporated  by  reference  to  the  Company's Definitive Proxy
Statement  on  Schedule 14A which will be filed with the Securities and Exchange
Commission  on  or  before  October  29,  2001.

ITEM 11 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

This  item  is  incorporated  by  reference  to  the  Company's Definitive Proxy
Statement  on  Schedule 14A which will be filed with the Securities and Exchange
Commission  on  or  before  October  29,  2001.

ITEM 12 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

This  item  is  incorporated  by  reference  to  the  Company's Definitive Proxy
Statement  on  Schedule 14A which will be filed with the Securities and Exchange
Commission  on  or  before  October  29,  2001.

ITEM 13 - EXHIBITS AND REPORTS ON FORM 8-K

This  item  is  incorporated  by  reference  to  the  Company's Definitive Proxy
Statement  on  Schedule 14A which will be filed with the Securities and Exchange
Commission  on  or  before  October  29,  2001.

                                       24
<PAGE>

                                      SIGNATURES

Pursuant  to  the requirements of Section 13 or 15(d) of the Securities Exchange
Act  of  1934,  the  registrant  has duly caused this report to be signed on its
behalf  by  the  undersigned,  thereunto  duly  authorized.

Dated:  October  24,  2001



                         TANGIBLE ASSET GALLERIES, INC.
                                  (Registrant)
By:  /s/  Michael  R.  Haynes
          ----------------------------
          Michael  R.  Haynes
          President and Chief Financial Officer

Pursuant to requirements of the Securities Exchange Act of 1934, this report has
been  signed  below  by the following persons on behalf of the registrant and in
the  capacities  and  on  the  dates  indicated:

Signature                       Capacity     Date
---------                       --------     ----
/s/  Silvano  DiGenova          Director     October  24,  2001
     -----------------------
     Silvano  DiGenova

/s/  Michael  R.  Haynes        Director     October  24,  2001
     -----------------------
     Michael  R.  Haynes

/s/  Yvonne E. Wong Chester     Director     October  24, 2001
     -----------------------
     Yvonne E. Wong Chester

/s/  Robert  Escobio            Director     October  24, 2001
     -----------------------
     Robert  Escobio

/s/  Richard  Viola             Director     October  24,  2001
     -----------------------
     Richard  Viola

/s/  Arthur  Marcus             Director     October  24,  2001
     -----------------------
     Arthur  Marcus


                                       25
<PAGE>
                         TANGIBLE ASSET GALLERIES, INC.

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


Independent Auditors' Report                                F-2

                     Consolidated Financial Statements

Consolidated Balance Sheets                                 F-3

Consolidated Statements of Operations                       F-4

Consolidated Statements of Stockholders' Equity             F-5

Consolidated Statements of Cash Flows                       F-6

Notes to Consolidated Financial Statements                  F-8



                                      F-1
<PAGE>

INDEPENDENT  AUDITORS'  REPORT


Board  of  Directors
Tangible  Asset  Galleries,  Inc.
Newport  Beach,  California


We  have  audited the accompanying consolidated balance sheets of Tangible Asset
Galleries,  Inc.  and  subsidiaries  (the  "Company")  as  of  June 30, 2001 and
December  31,  2000,  and  the  related  consolidated  statements of operations,
stockholders'  equity  and cash flows for the six months ended June 30, 2001 and
the  twelve  months  ended December 31, 2000. These financial statements are the
responsibility  of the Company's management. Our responsibility is to express an
opinion  on  these  financial  statements  based  on  our  audits.

We conducted our audits in accordance with auditing standards generally accepted
in  the  United  States  of  America.  Those  standards require that we plan and
perform  the  audit  to  obtain reasonable assurance about whether the financial
statements  are free of material misstatement. An audit includes examining, on a
test  basis,  evidence  supporting  the amounts and disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made  by  management,  as well as evaluating the overall
financial  statement  presentation.  We  believe  that  our  audits  provide  a
reasonable  basis  for  our  opinion.

In  our opinion, the consolidated financial statements referred to above present
fairly,  in  all  material  respects,  the  financial position of Tangible Asset
Galleries,  Inc. and subsidiaries as of June 30, 2001 and December 31, 2000, and
the  results  of  their operations and their cash flows for the six months ended
June  30, 2001 and the twelve months ended December 31, 2000, in conformity with
accounting  principles  generally  accepted  in  the  United  States of America.


                                        /s/  Haskell  &  White  LLP

                                        HASKELL  &  WHITE  LLP

Irvine,  California
October  18,  2001

                                      F-2
<PAGE>
<TABLE>
<CAPTION>

                         TANGIBLE ASSET GALLERIES, INC.
                           CONSOLIDATED BALANCE SHEETS


<S>                                                                   <C>             <C>
                                                                                      December 31,
                                                                      June 30, 2001      2000
                                                                      --------------  ------------

ASSETS
CURRENT ASSETS
   Cash and cash equivalents (Note 1)                                 $     226,425   $     5,622
   Accounts receivable, net (Note 1)                                        996,480       778,978
   Due from employees                                                        71,235        31,349
   Inventories (Notes 1, 2, 5, 6 and 7)                                   8,761,422     7,890,562
   Prepaid expense and other                                                233,415       149,896
                                                                      --------------  ------------
Total current assets                                                     10,288,977     8,856,407

PROPERTY AND EQUIPMENT, NET (Note 3)                                        519,198       250,771
GOODWILL AND OTHER INTANGIBLE ASSETS (Note 4)                             3,049,071       293,082
OTHER ASSETS                                                                 44,927        17,902
                                                                      --------------  ------------
TOTAL ASSETS                                                          $  13,902,173   $ 9,418,162
                                                                      ==============  ============

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
   Line of credit (Note 5)                                            $   1,040,000   $ 1,790,000
   Accounts payable and accrued expenses                                  3,601,412     1,682,539
   Notes payable to related parties (Note 7)                              4,000,000     2,100,000
   Notes payable (Note 6)                                                   623,652       865,510
   Obligations under capital leases                                          20,324         6,813
                                                                      --------------  ------------
Total current liabilities                                                 9,285,388     6,444,862
                                                                      --------------  ------------
LONG-TERM LIABILITIES
   Notes payable to related parties, net of current portion (Note 7)        789,194     2,359,440
   Notes payable, net of current portion (Note 6)                            16,541        18,755
   Obligations under capital leases, net of current portion                   3,235         6,275
   Deferred taxes (Note 8)                                                   10,000        10,000
                                                                      --------------  ------------
Total long-term liabilities                                                 818,970     2,394,470
                                                                      --------------  ------------
TOTAL LIABILITIES                                                        10,104,358     8,839,332
                                                                      --------------  ------------
COMMITMENTS AND CONTINGENCIES (NOTES 5, 6, 7, 9, 10 AND 11)
STOCKHOLDERS' EQUITY
Undesignated preferred stock, $.001 par value, 15,000,000
 shares authorized; none issued and outstanding (Note 9 and 12)                   -             -
Common stock, $.001 par value, 100,000,000
shares authorized; 37,510,643, (2001) and 18,755,298 (2000)
issued and outstanding  (Note 1, 9 and 11)                                   37,511        18,755
   Additional paid in capital                                             6,285,400     2,675,972
   Accumulated deficit                                                   (2,525,096)   (2,115,897)
                                                                      --------------  ------------
                                                                          3,797,815       578,830
                                                                      --------------  ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                            $  13,902,173   $ 9,418,162
                                                                      ==============  ============
</TABLE>

See accompanying notes to consolidated financial statements.


                                      F-3
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS


<TABLE>
<CAPTION>

                                                                        Six Months
                                                         Six Months    Ended June 30,    Year Ended
                                                     Ended June 30,        2000         December 31,
                                                               2001     (Unaudited)         2000
                                                       ------------  ----------------  ------------
<S>                                                    <C>           <C>               <C>

NET SALES                                              $17,716,035   $    13,654,064   $29,526,139

COST OF SALES                                           15,237,437        11,515,986    24,822,121
                                                       ------------  ----------------  ------------

GROSS PROFIT                                             2,478,598         2,138,078     4,704,018

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES             2,343,474         2,393,199     5,435,289
                                                       ------------  ----------------  ------------

Income (loss) from operations                              135,124          (255,121)     (731,271)
                                                       ------------  ----------------  ------------

OTHER INCOME (EXPENSE)
   Interest income                                           4,717             2,261         8,039
   Interest expense (Notes 5, 6, and 7)                   (562,017)         (424,684)     (880,961)
   Other expense, net                                       16,827                 -        (5,000)
                                                       ------------  ----------------  ------------

                                                          (540,473)         (422,423)     (877,922)
                                                       ------------  ----------------  ------------

LOSS BEFORE INCOME TAX PROVISION                          (405,349)         (677,544)   (1,609,193)

INCOME TAX PROVISION (NOTE 8)                                3,850            15,000        20,657
                                                       ------------  ----------------  ------------

NET LOSS                                               $  (409,199)  $      (692,544)  $(1,629,850)
                                                       ============  ================  ============

BASIC AND DILUTED NET LOSS PER SHARE                   $     (0.02)  $         (0.04)  $     (0.09)
                                                       ============  ================  ============

WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING    19,276,280        18,387,268    18,539,108

</TABLE>

See accompanying notes to consolidated financial statements.


                                      F-4
<PAGE>

                 TANGIBLE ASSET GALLERIES, INC. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
   FOR THE YEAR ENDED DECEMBER 31, 2000 AND THE SIX MONTHS ENDED JUNE 30, 2001

<TABLE>
<CAPTION>

                                                     ----------------------------
                                                              Common Stock
                                                     ----------------------------

                                                                                                        Retained
                                                                                          Additional    earnings         Total
                                                                                           paid-in    (accumulated   Stockholder's
                                                         Shares             Amount         Capital       deficit)       equity
                                                   -------------------  --------------  --------------  ------------  ------------
<S>                                                   <C>                 <C>             <C>             <C>           <C>
 BALANCE, DECEMBER 31, 1999                                18,372,215   $      18,372   $    2,423,230  $  (486,047)  $ 1,955,555
 Fair value of option grants (Note 9)                               -               -           26,250            -        26,250
 Fair value of warrant grants (Note 9)                              -               -           59,375            -        59,375
 Issuance of stock for services (Note 9)                      243,083             243           97,257            -        97,500
 Sale of stock in private placement (Note 9)                  140,000             140           69,860            -        70,000
 Net loss for the year                                              -               -                -   (1,629,850)   (1,629,850)
                                                   -------------------  --------------  --------------  ------------  ------------
 BALANCE, DECEMBER 31, 2000                                18,755,298          18,755        2,675,972   (2,115,897)      578,830
Issuance of common stock in connection
with business  acquisition and merger (Note 11)            18,755,345          18,756        3,394,717            -     3,413,473
Fair value of warrants issued in connection
with business  acquisition and merger (Note 11)                     -               -           84,455            -        84,455
Fair value of prior option grants earned (Note 9)                   -               -            1,880            -         1,880
 Fair value of warrant grants (Note 9)                              -               -          111,000            -       111,000
 Other reclassification                                             -               -           17,376            -        17,376
Net loss for the six month period                                   -               -                      (409,199)     (409,199)
                                                   -------------------  --------------  --------------  ------------  ------------
 BALANCE, JUNE 30, 2001                                    37,510,643   $      37,511   $    6,285,400  $(2,525,096)  $ 3,797,815
                                                   ===================  ==============  ==============  ============  ============


</TABLE>

See accompanying notes to consolidated financial statements.


                                      F-5
<PAGE>

<TABLE>
<CAPTION>


                         TANGIBLE ASSET GALLERIES, INC.
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                                 Six Months
                                                                Six Months      Ended June 30,    Year Ended
                                                               Ended June 30,       2000          December 31,
                                                                   2001          (Unaudited)         2000
                                                             ----------------  ----------------  ------------
<S>                                                          <C>               <C>               <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss                                                     $      (409,199)  $      (692,544)  $(1,629,850)
Adjustments to reconcile net loss to net cash
   provided by (used in) operating activities:
   Depreciation and amortization                                      72,747            70,363       130,035
   Bad debts                                                               -                 -        48,239
   Fair value of options granted                                       1,880            12,500        26,250
   Fair value of warrants granted                                     17,593                 -        59,375
   Issuance of common stock for services                                   -            18,125        97,500
   Other                                                               8,782                 -             -
Changes in assets or liabilities, net of effect of business
   acquisition:
   Accounts receivable                                              (127,415)          147,052       198,837
   Inventories                                                      (870,860)         (685,689)   (1,471,426)
   Prepaid expenses and other                                        (83,519)           (8,812)      (91,734)
   Decrease (increase) in other assets                                (9,125)            5,961       (43,759)
   Accounts payable and accrued expenses                           1,557,526           927,137       441,147
                                                             ----------------  ----------------  ------------
Net cash provided by (used in) operating activities                  158,410          (205,907)   (2,235,386)
                                                             ----------------  ----------------  ------------
CASH FLOWS FROM INVESTING ACTIVITIES
   Purchases of property and equipment                                (6,413)         (143,504)     (174,922)
   Cash acquired in purchase business combination                    707,270                 -             -
                                                             ----------------  ----------------  ------------
Net cash provided by (used in) investing activities                  700,857          (143,504)     (174,922)
                                                             ----------------  ----------------  ------------

</TABLE>

See accompanying notes to consolidated financial statements.


                                      F-6
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

<TABLE>
<CAPTION>




                                                                                      Six Months
                                                                       Six Months    Ended June 30,    Year Ended
                                                                     Ended June 30,       2000        December 31,
                                                                          2001        (Unaudited)         2000
                                                                      ------------  ----------------  ------------
<S>                                                                   <C>           <C>               <C>
CASH FLOWS FROM FINANCING ACTIVITIES
   Repayments under line of credit, net                                  (750,000)                -       (50,000)
   Borrowings (repayments) under notes payable                           (244,072)                -       665,510
   Net increase in related party debt                                     329,754           312,212     1,638,928
   Borrowings under loan payable                                                -                 -        18,755
   Borrowings (repayments) on obligations under capital lease              25,854            (4,977)       (9,145)
   Issuance of common stock                                                     -                 -        70,000
                                                                      ------------  ----------------  ------------
Net cash provided by (used in) financing activities                      (638,464)          307,235     2,334,048
                                                                      ------------  ----------------  ------------

Net (decrease) increase in cash and cash equivalents                      220,803           (42,176)      (76,260)

Cash and cash equivalents, beginning of period                              5,622            81,882        81,882

                                                                      ------------  ----------------  ------------
Cash and cash equivalents, end of period                              $   226,425   $        39,706   $     5,622
                                                                      ============  ================  ============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
   Cash paid during the period for:
      Interest                                                        $   442,575   $       422,702   $   880,961
                                                                      ============  ================  ============
      Income taxes                                                    $     3,850   $         7,400   $         -
                                                                      ============  ================  ============

SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITY
During the six months ended June 30, 2001, the Company
acquired all of the outstanding common stock of
HotelInteractive, Inc. through the issuance of shares of the
Company's common stock and warrants to purchase common
stock (Note 11). In conjunction with the  acquisition, assets
were acquired and liabilities were assumed as follows:
      Fair value of assets acquired                                   $ 3,498,928   $             -   $         -
                                                                      ============  ================  ============
      Liabilities assumed                                             $   344,230   $             -   $         -
                                                                      ============  ================  ============

</TABLE>

See accompanying notes to consolidated financial statements.


                                      F-7
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


1.     SUMMARY  OF  SIGNIFICANT  ACCOUNTING  POLICIES

     ORGANIZATION  AND  BUSINESS

     Tangible  Asset  Galleries, Inc. ("TAG") and its wholly owned subsidiaries,
Gehringer  and  Kellar dba Keystone Stamp & Coin Exchange ("Keystone"), Tangible
Collectibles,  Inc.  ("TCI")  and  as  of  June 30, 2001, HotelInteractive, Inc.
("HI") (collectively the "Company") are wholesalers and retailers of rare coins,
fine  art  and  collectibles, while HI is a publisher of news and information on
the  Internet,  specifically related to the hospitality industry. The Company is
based  in  Newport  Beach,  California.  The Company's Keystone unit operates in
Allentown,  Pennsylvania  and  the Company's HI unit operates in Huntington, New
York.

     Subsequent to the fiscal year end of December 31, 2000, the Company changed
it's  fiscal year to end on June 30. Accordingly, the Company has prepared these
financial  statements  for  the  six  months  ended  June  30,  2001.

     BASIS  OF  PRESENTATION

     On  September  15,  2000,  the  Company  incorporated TCI as a wholly owned
subsidiary  for the purpose of transacting business with independent contractors
in  the  rare  coin  markets.

     On June 25, 2001, the Company acquired 100% of the outstanding common stock
of  HI,  a  publisher  of  news  and  information  on  the  Internet  located in
Huntington, New York, by merging HI into a newly formed wholly owned subsidiary.
Pursuant  to  the  merger and acquisition agreement relating to the transaction,
TAG  issued  18,755,345  shares of its previously authorized but unissued common
stock  in  exchange  for  all  the outstanding common stock of HI (see Note 11).

     All significant intercompany balances and transactions have been eliminated
in  consolidation.

     The consolidated statements of operations and cash flows for the six months
ended  June  30, 2000 are unaudited and presented for comparative purposes given
the  nature  of the Company's change in year end.  In the opinion of management,
all adjustments considered necessary for a fair presentation have been included.

     CASH  AND  CASH  EQUIVALENTS

     The  Company  considers  all  highly  liquid  investments  with  original
maturities  of  three  months or less when purchased to be cash equivalents. The
Company  places  its  cash  with  high  credit quality institutions. The Federal
Deposit Insurance Corporation ("FDIC") insures cash accounts at each institution
for  up  to $100,000. From time to time, the Company maintains cash in excess of
the  FDIC  limit.

     INVENTORIES

     Inventories  consisting  of  rare  coins,  fine  art,  antiques  and  other
collectibles  are  stated  at  the  lower  of cost (on a specific identification
basis)  or  market.



                                      F-8
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     PROPERTY  AND  EQUIPMENT

     Property  and equipment are stated at cost and are depreciated or amortized
(as  applicable)  using the straight-line method over the estimated useful lives
of  the  related  assets,  ranging  from  three  to seven years. Maintenance and
repairs are charged to expense as incurred. Significant renewals and betterments
are  capitalized. At the time of retirement or other disposition of property and
equipment,  the  cost  and accumulated depreciation and amortization are removed
from  the  accounts  and  any resulting gain or loss is reflected in operations.

     The  Company  assesses  the  recoverability  of  property  and equipment by
determining  whether the depreciation and amortization of property and equipment
over  its  remaining life can be recovered through projected undiscounted future
cash  flows.  The  amount  of  property  and  equipment  impairment,  if any, is
measured based on fair value and is charged to operations in the period in which
property and equipment impairment is determined by management.  At June 30, 2001
and December 31, 2000, management of the Company has not identified any impaired
assets.

     GOODWILL  AND  OTHER  INTANGIBLE  ASSETS

     Goodwill  is  related to the acquisition of Keystone and the acquisition of
HI  (Note  11).  Goodwill  is amortized using the straight-line method over five
years  through  June  30,  2001.  See  Effect of "New Accounting Pronouncements"
below.  The  Company  assesses  the  recoverability  of  goodwill by determining
whether  the  amortization  over  the  remaining  life  can be recovered through
projected  undiscounted  future cash flows. The amount of impairment, if any, is
measured based on fair value and is charged to operations in the period in which
impairment  is determined by management. At June 30, 2001 and December 31, 2000,
management  of  the  Company  has  not  identified  any  impaired  assets.

     USE  OF  ESTIMATES

     The  preparation  of  financial  statements  in  conformity  with generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect  the  reported  amounts  of assets and liabilities and
disclosure  of  contingent  assets  and liabilities at the date of the financial
statements,  and  the  reported  amounts  of  revenues  and  expenses during the
reported  periods.  Actual results could materially differ from those estimates.
Areas  where significant estimation is involved include, but are not limited to,
the  evaluation  of  the  collectibility  of  accounts  receivable  and  the
realizability  and  valuation  of  inventories.

                                      F-9
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     REVENUE  RECOGNITION

     The  Company  generates  revenue  from  wholesale  and retail sales of rare
coins,  precious  metals  bullion,  fine  art,  antiques  and  collectibles. The
recognition  of  revenue varies for wholesale and retail transactions and is, in
large  part,  dependent  on  the  type  of  consideration (i.e., monetary and/or
non-monetary)  and  the  timing  and  amount  of  such  consideration.

     The  Company  sells  merchandise  (generally  coins)  to  other
wholesalers/dealers  within its industry on credit, generally for terms of 30 to
60  days,  but  in no event greater than one year.  The Company grants credit to
new dealers based on extensive credit evaluations and for existing dealers based
on  established  business  relationships  and  payment  histories.  The  Company
generally  does  not  obtain  collateral  with  which  to  secure  its  accounts
receivable when the sale is made to a dealer. The Company maintains reserves for
potential  credit  losses based on an evaluation of specific receivables and the
Company's  historical  experience  related to credit losses. As of June 30, 2001
and December 31, 2000, management has established an accounts receivable reserve
of $48,239. Revenues for monetary transactions (i.e., cash and receivables) with
dealers  are  recognized  when the merchandise is shipped to the related dealer.

     The Company also sells merchandise (generally coins) to retail customers on
credit,  generally  for terms of 30 to 60 days, but in no event greater than one
year.  The  Company  grants credit to retail customers based on extensive credit
evaluations  and  for  existing  retail  customers based on established business
relationships  and  payment histories. When a retail customer is granted credit,
the  Company generally collects a payment of 25% of the sales price, establishes
a  payment  schedule  for  the  remaining  balance  and holds the merchandise as
collateral  as  security against the customer's receivable until all amounts due
under  the  credit arrangement are paid in full. If the customer defaults in the
payment  of  any  amount  when  due,  the  Company  may  declare  the customer's
obligation  in  default,  liquidate  the collateral in a commercially reasonable
manner  using such proceeds to extinguish the remaining balance and disburse any
amount  in  excess  of  the  remaining  balance  to  the  customer.

     Under  this  retail  arrangement, revenues are recognized when the customer
agrees to the terms of the credit and makes the initial payment. Less than 5% of
the  Company's  sales  are  retail  credit  sales.  The  Company's  has  a
limited-in-duration  money  back  guaranty  policies  (as  discussed  below).

                                      F-10
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     In  limited  circumstances,  the  Company exchanges merchandise for similar
merchandise  and/or  monetary  consideration  with  both  dealers  and  retail
customers,  for  which the Company recognizes revenue in accordance with APB No.
29,  "Accounting  for  Non-monetary  Transactions."  When  the Company exchanges
merchandise  for  similar  merchandise and there is no monetary component to the
exchange, the Company does not recognize any revenue.  Instead, the basis of the
merchandise relinquished becomes the basis of the merchandise received, less any
indicated  impairment of value of the merchandise relinquished. When the Company
exchanges  merchandise for similar merchandise and there is a monetary component
to the exchange, the Company recognizes revenue to the extent of monetary assets
received  and  determines the cost of sale based on the ratio of monetary assets
received  to monetary and non-monetary assets received multiplied by the cost of
the  assets  surrendered.

     The  Company  also  generates  revenues from consignment sales. Consignment
sales  are  in cash and, under limited circumstances, on account. As of June 30,
2001 and December 31, 2000, there were no consignment sales included in accounts
receivable.  There  are  two  primary  methods  in  which the Company recognizes
revenues  from  consignment  sales: (1) percentage-of-sales, and (2) fixed cost.

     Under  the percentage-of-sales method, the Company receives the merchandise
from  the  consignor  and  mutually  agrees  to  sell  or auction the underlying
merchandise to a third party for a predetermined floor price, period of time and
percentage  of  the ultimate sales price, which generally ranges from 5% to 15%.
Upon  sale  of  the  merchandise to a third party and cash tendered, the Company
recognizes net revenues for its allocable percentage of the ultimate sales price
and  remits  the  remaining cash proceeds to the consignor. Under the fixed cost
method,  the  Company  receives  the merchandise from the consignor and mutually
agrees  to  sell  or  auction the underlining merchandise to a third party for a
predetermined  period  of time, without regard to the ultimate sales price.  The
Company  and  the  consignor mutually agree to a price that the Company will pay
the  consignor upon the ultimate sale of the underlining merchandise; otherwise,
a  fixed cost.  Upon sale of the merchandise to a third party and cash tendered,
the  Company  recognizes net revenues comprised of the ultimate sales price less
the  agreed  upon  fixed cost, and the proceeds attributed to the fixed cost are
remitted  to  the  consignor.

     The Company has two separate return policies (money-back guarantees).  Both
policies  cover  retail  transactions  only.  The first policy relates solely to
graded  rare  coins.  Customers  may return graded rare coins purchased within 7
days  of  the  receipt  of  the rare coins for a full refund as long as the rare
coins  are returned in exactly the same condition as they were delivered. In the
case  of rare coin sales on account, customers may cancel the sale within 7 days
of  making a commitment to purchase the rare coins. The receipt of a deposit and
a  signed  purchase  order  evidences  the  commitment.


                                      F-11
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     The  second  policy  relates  to  fine art, antiques and collectibles only.
These items may be returned within 30 days of their receipt for a full refund as
long  as  the  items  are  returned  in  exactly the same condition as they were
delivered.  In the case of fine art, antiques and collectibles sales on account,
customers  may  cancel  the  sale  within  30  days  of a making a commitment to
purchase  the  items.  The  receipt  of  a  deposit  and a signed purchase order
evidences  the commitment. Historically, the Company's retail customers have not
exercised  their  rights  to  money-back  guarantees  and as such, the Company's
management  has  not  provided  a  reserve for sales returns in the accompanying
consolidated  financial  statements.

     ADVERTISING

     Advertising  costs  are  expensed  as incurred. During the six months ended
June  30,  2001  and  2000,  advertising expenses totaled $150,033 and $224,469,
respectively,  and  for  the  twelve  months ended December 31, 2000 advertising
expenses  were  $418,962.

     INCOME  TAXES

     The  Company  accounts  for  income  taxes  under  Statement  of  Financial
Accounting  Standards  No.  109,  "Accounting  for  Income Taxes", ("SFAS 109").
Under  SFAS  109,  deferred  tax  assets  and liabilities are recognized for the
future  tax  consequences  attributable  to  differences  between  the financial
statement  carrying  amounts  of  existing  assets  and  liabilities  and  their
respective  tax  bases.  Deferred  tax assets and liabilities are measured using
enacted  tax  rates  expected  to  apply to taxable income in the years in which
those temporary differences are expected to be recovered or settled. A valuation
allowance is provided for significant deferred tax assets when it is more likely
than  not  that  such  assets  will  not  be  recovered.

     STOCK-BASED  COMPENSATION

     The  Financial  Accounting  Standards  Board  issued Statement of Financial
Accounting  Standards  No.  123  ("SFAS  123"),  "Accounting  for  Stock-Based
Compensation,"  which  defines  a  fair  value  based  method  of accounting for
stock-based  compensation.  However,  SFAS  123  allows an entity to continue to
measure compensation cost related to stock and stock options issued to employees
using  the  intrinsic  method  of accounting prescribed by Accounting Principles
Board  Opinion  No.  25  ("APB 25"), "Accounting for Stock Issued to Employees."
Entities  electing to remain with the accounting method of APB 25 must  make pro
forma  disclosures  of  net  income,  as  if  the  fair  value  method  of
accounting  defined  in  SFAS  123  had been applied. The Company has elected to
account  for  stock-based  compensation  to  employees  under  APB  25.



                                      F-12
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

    EARNINGS  PER  SHARE

The  Financial Accounting Standards Board ("FASB") issued Statement of Financial
Accounting  Standards  No.  128  ("SFAS"),  "Earnings  Per Share ("EPS")," which
requires  dual  presentation  of  basic  EPS  and diluted EPS on the face of all
income  statements  issued after December 15, 1997 for all entities with complex
capital  structures. Basic EPS is computed as net income divided by the weighted
average number of common shares outstanding for the period. Diluted EPS reflects
the  potential  dilution  that  could  occur from common shares issuable through
stock  options,  warrants  and other convertible securities. The total potential
common shares that have not been included in the calculation of diluted net loss
per  common  share totaled 16,840,390, 3,500,000 and 11,390,303 at June 30, 2001
and  2000  and  at  December  31, 2000, respectively, as the effects of such are
anti-dilutive  for  each  period.

     SEGMENT  REPORTING

     The Company adopted SFAS No. 131 ("SFAS 103"),  "Disclosures about Segments
of  an  Enterprise  and  Related  Information,"  during  fiscal  1999.  SFAS 131
establishes standards for the way that public companies report information about
operating  segments  and  related  disclosures  about  products  and  services,
geographic  areas  and  major  customers  in  annual  consolidated  financial
statements.  The  Company  views  its  operations  and  manages  its business as
principally one segment, a dealer of collectibles. HI is not in the collectibles
business, however, such operations were immaterial for the reporting period. For
information  purposes,  the  sales of coins and fine art totaled $17,150,975 and
$565,060  for  the six months ended June 30, 2001, respectively, and $13,036,771
and  $567,811  for  the  six  months  ended  June  30,  2000,  respectively, and
$27,876,261  and  $1,649,878  for  the  twelve  months  ended December 31, 2000.

     COMPREHENSIVE  INCOME

     Effective  January  1,  1998,  the  Company  adopted Statement of Financial
Accounting  Standards  No.  130,  "Reporting Comprehensive Income" ("SFAS 130").
SFAS  130  established  new rules for the reporting and display of comprehensive
income and its components in a full set of general-purpose financial statements.
The  adoption  of  SFAS  130  had  no  effect  on  the accompanying consolidated
financial  statements,  because  the  Company  had  no  other  components  of
comprehensive  income.

     CUSTOMER  AND  VENDOR  CONCENTRATIONS

     During  the  six  months ended June 30, 2001 and 2000 and the twelve months
ended  December  31, 2000, the Company had no customer that accounted for 10% or
more  of  the  Company's  net  sales.  As  of June 30, 2001, the Company had one
customer  that  represented 11% of accounts receivable as of such date and as of
December 31, 2000, the Company had one customer that represented 13% of accounts
receivable  as  of  such  date.

                                      F-13
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     During  the  six  months ended June 30, 2001 and 2000 and the twelve months
ended  December  31,  2000,  the  Company  did  not  purchase 10% or more of its
inventories  from  any  single  vendor.  As of June 30, 2001, the Company had no
vendors  that  represented more than 10% of accounts payable as of such date and
as  of December 31, 2000, one customer represented 12% of accounts payable as of
such  date.

     RISKS  AND  UNCERTAINTIES

     Market Risk

     Over  time, market demand for fine art and investment grade coins will vary
due  to  perceived  scarcity,  subjective  valuation,  general  consumer trends,
variations  in  the  price  of  precious  metals,  and  other  general  economic
conditions.  The  Company  derives  a  significant  portion of its revenues from
wholesale  dealers and retail collectors on the sales of fine art and investment
grade  coins.  Declines in market demand for fine art and investment grade coins
would  likely  cause  a  decrease  in  annual  sales revenue and have an overall
negative  affect  on  operations.

     Inventory  Risk

     The  Company purchases fine art and investment grade coins from dealers and
collectors  and assumes the inventory and price risks of these items until sold.
If  the  Company  were unable to sell such inventory, or at prices sufficient to
generate a profit, or if the market value of such inventory were to decline, the
ultimate  amounts  realized by the Company from the sale of such inventory could
be  less  than  the  carrying  values reflected in the accompanying consolidated
balance  sheet.

     FAIR  VALUE  OF  FINANCIAL  INSTRUMENTS

     Statement  of  Financial  Accounting  Standards No. 107, "Disclosures about
Fair Value of Financial Instruments", requires the disclosure of the fair value,
if reasonably obtainable, of the Company's financial instruments.  The Company's
financial  instruments consist of its cash, accounts receivable, line of credit,
accounts payable and accrued expenses, note payable and notes payable to related
parties.  Management  has  determined  that, except for notes payable to related
parties,  the  fair  values  of  the Company's financial instruments approximate
their  carrying  values  at June 30, 2001 and December 31, 2000.  Management was
unable  to  determine the fair value of the notes payable to related parties, as
an  active  market  for  such  instruments  does  not  exist.








                                      F-14
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     EFFECT  OF  NEW  ACCOUNTING  PRONOUNCEMENTS

     On  June 29, 2001, the Financial Accounting Standards Board ("FASB") issued
Statement of Financial Accounting Standards, No. 142 ("SFAS 142"), "Goodwill and
Other  Intangible  Assets."  SFAS 142 supercedes APB Opinion No. 17, "Intangible
Assets,"  and  requires  goodwill  and  other  intangible  assets  that  have an
indefinite  useful life to no longer be amortized. However, these assets must be
reviewed at least annually for impairment. SFAS 142 will be effective for fiscal
years  beginning  after  December  15,  2001.  Early  adoption  is permitted for
companies  with  a  fiscal  year  beginning  after  March  15, 2001.  Due to the
complexity  of  this  new  standard  and  its  recent  issuance,  the Company is
currently  evaluating  the  impact  of  SFAS  142  on the financial position and
statement  of  operations.

     In  June  2000,  the  Financial  Accounting Standards Board ("FASB") issued
Statement  of  Financial  Accounting  Standards ("SFAS") No. 138 "Accounting for
Certain  Derivative  Instruments  and  Certain Hedging Activities," which amends
SFAS  No.  133,  "Accounting for Derivative Instruments and Hedging Activities."
SFAS  No. 133 was previously amended by SFAS No. 137, "Accounting for Derivative
Instruments  and  Hedging  Activities  -  Deferral of the Effective Date of FASB
Statement  No. 133," which deferred the effective date of SFAS No. 133 to fiscal
years commencing after June 15, 2000.  The Company currently does not engage in,
nor  does  it  expect  to  engage  in,  derivative  or  hedging  activities and,
accordingly, the Company anticipates there will be no impact to its consolidated
financial  statements.

     Staff  Accounting  Bulletin  ("SAB")  No.  101,  "Revenue  Recognition",
summarizes  the Securities and Exchange Commission's views on applying generally
accepted  accounting  principles to revenue recognition in financial statements.
Significant  views  addressed  relate to shipping terms, customer acceptance and
bundled service contracts.  Implementation is effective for the first quarter of
fiscal 2001.  The Company believes that its current revenue recognition policies
comply  with  SAB  No.  101.

In March 2000, the FASB issued Interpretation No. 44 ("FIN 44"), "Accounting for
Certain  Transactions  Involving  Stock  Compensation,"  which addresses certain
accounting  issues  that  arose  under  the  previously  established  accounting
principles  relating  to  stock-based  compensation.  The  adoption  of  this
interpretation  did  not  have  a  material  effect  on  the Company's financial
position  or  results  of  operations.

                                      F-15
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


2.     INVENTORIES

     Inventories  are  comprised  of  the  following:

                                JUNE 30, 2001   December 31, 2001
                                ------------     ------------
   Rare coins                   $  7,221,284     $  5,912,123
   Fine and decorative arts        1,540,138        1,978,439
                                ------------     ------------
                                $  8,761,422     $  7,890,562
                                ============     ============


     Inventory  totaling $2,203,112 and $1,456,897 was on consignment with third
parties  at  June  30,  2001  and  December  31,  2000, respectively.  Inventory
totaling  $256,992  and  $291,942  was  held for display at the residence of the
chief  executive  officer  at June 30, 2001 and December 31, 2000, respectively.
Inventory  totaling  $352,500  and  $427,250  was  held  for  a  third  party as
collateral  for  a  note  payable  (Note 6) as of June 30, 2001 and December 31,
2000,  respectively.

The Company, from time to time, enters into joint ventures or purchase financing
agreements  with  third  parties  that  include  vendors  and  customers for the
purchase  and sale of specific rare coins or fine collectibles. These agreements
may  include  profit  sharing  provisions  ranging  from 25% to 50% of the gross
profit  on  specific transactions adjusted for agreed upon expenses and interest
costs.  At  any  given  time,  the  Company may be involved in up to 10 of these
agreements.  As  of  June  30,  2001  and  December  31,  2000, inventory totals
reflected  the  Company's  total  appropriate ownership and does not include any
minority  interest  claims  in  regard  to  such  joint  venture  or partnership
arrangements.


                                      F-16
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

3.     PROPERTY  AND  EQUIPMENT

     Property  and  equipment  consists  of  the  following:

                                                          December 31,
                                            JUNE 30, 2001     2000
                                           --------------  ----------
Furniture and equipment                    $     176,129   $ 133,695
Computer equipment                               439,281     184,286
Vehicles                                          24,676      24,676
Leasehold improvements                            55,505      52,542
                                                 695,591     395,199
Accumulated depreciation and amortization       (176,393)   (144,428)
                                           --------------  ----------
                                           $     519,198   $ 250,771
                                           ==============  ==========


4.     GOODWILL  AND  OTHER  INTANGIBLE  ASSETS

     Good  will  and  other  intangible  assets  consist  of  the  following:

                                                December 31,
                                 JUNE 30, 2001     2000
                                --------------  ---------
Goodwill (Note 11)              $   2,596,771   $300,000
Internet names and graphics           231,272     31,272
Customer lists                        340,407     40,407
                                --------------  ---------
                                    3,168,450    371,679
                                --------------  ---------

Less accumulated amortization        (119,379)   (78,597)
                                --------------  ---------

                                $   3,049,071   $293,082
                                ==============  =========




                                      F-17
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


5.     LINE-OF-CREDIT

     On  August  30,  1999,  the  Company  obtained  a $2,000,000 line-of-credit
agreement  with  a  bank  that bore interest at the bank's prime rate, plus 1.5%
(10.25% at December 31, 1999).  The line-of-credit agreement was renegotiated on
April  30, 2000 and renegotiated again on October 31, 2000, lowering the maximum
principal  amount  under  the line-of-credit to $1,840,000 and expiring on April
28,  2001.  The  renegotiated  line-of-credit bears interest at the bank's prime
rate,  plus  2.50%  (12.00%  at  December  31,  2000)  and  is collateralized by
substantially all of the assets of the Company and the personal guarantee of the
Company's  chief  executive  officer and principal stockholder. The renegotiated
line-of-credit  also  required  monthly  principal payments equal to $50,000 per
month  for  three  consecutive  months and $75,000 per month for two consecutive
months. On April 28, 2001, the Company renegotiated the line-of-credit to expire
on  June  29,  2001  and to provide for principal payments of $100,000 per month
with a principal reduction of $400,000 at May 31, 2001 and the remaining balance
due  at  June 29, 2001. On June 29, 2001, the line-of-credit was renegotiated to
expire on January 31, 2002 with principal payments of $100,000 per month and the
remaining  balance  due  on  the expiration date. The outstanding balance on the
line-of-credit  as  of  June  30,  2001 and December 31, 2000 was $1,040,000 and
$1,790,000,  respectively.

The  Company  will  need  to seek a replacement lender to finance the short term
liquidity  needs of the Company's operations. There can be no assurance that the
Company  will  locate  a  lender  to  provide funding on terms acceptable to the
Company.

The  Company's  line-of-credit has certain restrictive financial covenants. Such
covenants  include minimum tangible net worth requirements, maximum asset to net
worth  ratios,  minimum  net  income  requirements  and  other restrictions with
respect to specified activities. At June 30, 2001, the Company was in compliance
with  all  such  covenants.


                                      F-18
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


6.     NOTES  PAYABLE

     Notes  payable  consist  of  the  following:


<TABLE>
<CAPTION>
<S>                                                                           <C>              <C>

                                                                              JUNE 30, 2001    December 31, 2000
                                                                              ---------------  -------------------
Short-term loan agreement due on demand, with interest payable monthly at
the prime rate (9.50% as of December 31, 2000) plus 4.50% per annum;
collateralized by specific rare coins in inventory, which are being held by
the lender (Note 2).                                                          $      214,256   $          428,000
                                                                              ---------------  -------------------

Advances on consignment agreements with auctioneers and dealers to sell
property owned by the Company with such advances generally bearing
interest at the annual rate of 12%. Accrued interest and principal is due at
the conclusion of the auctions or sales contracts, as the case may be,
usually 45 days after the auction date or after the contract date.                   405,034              433,275



Long term loan agreement dated October 17, 2000, secured by a delivery
van; payable in 60 monthly installments of principal and interest at an
annual interest rate of 5.9%.                                                         20,903               22,990
                                                                              ---------------  -------------------
                                                                                     640,193              884,265

Less current portion                                                                (623,652)            (865,510)
                                                                              ---------------  -------------------

                                                                              $       16,541   $           18,755
                                                                              ===============  ===================


</TABLE>

                                      F-19
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


7.     NOTES  PAYABLE  TO  RELATED  PARTIES

     Notes  payable  to  related  parties  consist  of  the  following:
<TABLE>
<CAPTION>
                                                                         JUNE 30, 2001    December 31, 2000
                                                                         ---------------  -------------------
<S>                                                                      <C>                  <C>
Subordinated note payable to Company's chief executive officer and
principal stockholder, bearing interest quarterly at 10.5% per annum.
The note matures December 31, 2004, at which time all outstanding
principal and interest is due.                                           $      789,194   $          959,440
                                                                         ---------------  -------------------

Subordinated convertible note payable to Company's chief executive
officer and principal stockholder; bearing interest at 10.5% per annum.
The note is convertible into common shares of the Company at $0.22
per share, as specified in the agreement.  The note matures at June 30,
2002.                                                                         1,400,000            1,400,000

Note payable to the previous owners of Gehringer and Kellar, Inc. d/b/a
Keystone Coin & Stamp; principal is due in full on demand, with
interest payable monthly at 8% per annum; secured by all assets of
Gehringer and Kellar, Inc                                                     1,600,000            1,100,000

Demand convertible note payable to a director of the Company as of
December 31, 2000, bearing interest at 13.5%, interest payable monthly,
with a profit sharing interest in a subsidiary of the Company, secured
by inventory of that subsidiary. The note is convertible into common
shares of the Company at the ratios of  (a) $500,000 for  666,666
common shares and (b) $500,000 for 500,000 common shares.                     1,000,000            1,000,000
                                                                         ---------------  -------------------
                                                                              4,789,194            4,459,440

Less current portion                                                         (4,000,000)          (2,100,000)

                                                                         $      789,194   $        2,359,440
                                                                         ===============  ===================

</TABLE>

     Interest  expense  incurred  to related parties during the six months ended
June  30,  2001 and 2000 totaled $264,521 and $149,745, respectively and for the
twelve  months  ended December 31, 2000, totaled $344,119, all of which has been
paid.

                                      F-20
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


     Principal  maturities  of  notes payable to related parties are as follows:


Years ending June 30,
2002                    $    4,000,000
2003                                 -
2004                                 -
2005                           789,194
                        --------------
                        $    4,789,194
                        ==============

8.     INCOME  TAXES

     The  provision  for  income  taxes  consists  of  the following components:


                            SIX MONTHS          Twelve Months
                            ENDED JUNE          Ended December
                             30, 2001             31, 2000
                           ----------          -----------
Current:
  Federal                  $        -          $         -
  State                         3,850               20,657
                           ----------          -----------
                                3,850               20,657

Deferred:
  Federal                           -                    -
  State                             -                    -
                           ----------          -----------
                                    -                    -
                           ----------          -----------

                            $   3,850          $    20,657
                           ==========          ===========


                                      F-21
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Deferred  income  taxes  reflect  the  net  tax  effect of temporary differences
between  the  carrying  amount of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. The income tax effects of
significant  items  comprising  the Company's net deferred income tax assets and
liabilities  are  as  follows:


                                       SIX MONTHS       Twelve Months
                                      ENDED JUNE 30,   Ended December
                                          2001            31, 2000
                                     ----------------  ----------------
Deferred tax assets:
Unearned income                      $         6,941   $        15,482
Net operating loss carryforwards             877,211           803,294
Amortization                                  35,851            24,635
Intangible asset                               7,800             7,800
Accrued vacation pay                           7,681             8,529
Allowance for doubtful accounts               19,216                 -
 Options and warrants not exercised           41,116                 -
Other                                          4,420             2,230
                                     ----------------  ----------------
Gross deferred tax assets                  1,000,236           861,970
Valuation allowance                       (1,002,635)         (864,369)
                                     ----------------  ----------------
Deferred tax assets, net of reserve           (2,399)           (2,399)
                                     ----------------  ----------------

Deferred tax liabilities:
Depreciation                                  (7,601)           (7,601)
                                     ----------------  ----------------

Net deferred tax liabilities         $       (10,000)  $       (10,000)
                                     ================  ================

     At June 30, 2001 and December 31, 2000, a 100% valuation allowance has been
provided  on  the  net  deferred  income  tax  assets  since  the Company cannot
determine  that  it  is  "more  likely  than  not"  to  be  realized.

     The  income tax benefit differs from the amount of income tax determined by
applying the expected U.S. Federal income tax rate to pretax loss for the fiscal
periods  years  ended  2001  and  2000  as  a  result  of:

                                     SIX MONTHS        Twelve Months
                                    ENDED JUNE 30,    Ended December
                                         2001            31, 2000
                                   ----------------  ----------------
Computed "expected" tax benefit    $      (139,128)  $      (537,978)
Decrease (increase) in income tax
  benefit resulting from:
Nondeductible expenses                       5,380             7,045
State income tax expense                     4,114            20,657
Change in tax status                       (12,099)           (7,024)
Increase in valuation allowance            138,266           610,588
Other                                        7,317           (72,631)
                                   ----------------  ----------------

                                   $         3,850   $        20,657
                                   ================  ================

     At  June 30, 2001, the Company has a Federal tax net operating loss ("NOL")
carryforward of approximately $2,485,000, which expires in 2021, and a state net
operating  loss carryforward of approximately $1,050,000, which expires in 2006.

     A  portion  of  the  NOLs  described above are subject to provisions of the
Internal  Revenue  Code  382  which  limits  the  use  of NOL carryforwards when
changes  of ownership of more than 50% occur during a three-year testing period.
During  the  period ended June 30, 2001, the Company's ownership changed by 50%,
as  a result of the HI acquisition. Further changes in common or preferred stock
ownership  in future years potentially limit the use of NOLs. The effect of such
limitations  has  yet  to  be determined. NOLs could be further limited upon the
exercise  of  outstanding  stock  options  and  warrants.



                                      F-22
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



9.     EQUITY

Common  and  Preferred  Stock

On  July 25, 2001, shareholders representing 57% of the outstanding shares voted
by  majority written consent to amend the Company's articles of incorporation to
increase  the  authorized  common  stock  from  50,000,000 shares to 100,000,000
shares.

On  June  25,  2001, pursuant to the acquisition and merger with HI, the Company
issued  18,755,345  shares  of  common stock (Note 11), which were valued at the
estimated market value of approximately $0.182 per share at the time of issuance

The Company issued no common stock for services during the six months ended June
30,  2001, however, on various dates throughout the twelve months ended December
31,  2000,  the Company issued an aggregate of 243,083 shares of common stock to
independent contractors as compensation for consulting services in the aggregate
amount  of  $97,500,  and  at  an  average  of  $0.40  per  share.

On  August 9, 2000, the Company sold 140,000 shares of common stock in a private
placement to a director of the Company in the aggregate of $70,000, or $0.50 per
share.

On  July  7,  2000,  the Board of Directors of the Company authorized 15,000,000
shares  of  $.001  par value preferred stock. As of June 30, 2001, the preferred
shares  are  undesignated  (Note  12).

Stock  Options

On  various  dates  during  the  six  months ended June 30, 2001, and during the
twelve  months ended December 31, 2000, the Company granted to certain employees
and independent contractors 2,235,000 and 1,150,000 stock options, respectively,
to  purchase  common  stock  at an average exercise price of $0.25 and $0.71 per
share,  respectively.  The  stock options vest and are exercisable over three to
five  year  periods. The stock options were granted at strike prices, which were
set  at  management's  estimate  of  market  value  as  of  the  date  of grant.

Total  options  granted  in the six months ended June 30, 2001 and in the twelve
months  ended  December  31,  2000  to nonemployees, net of cancellations, total
210,000  and  262,500, respectively.  The fair value of such options, calculated
by  management  using  an option pricing model, approximated $12,600 and $15,000
for  the six months ended June 30, 2001 and the twelve months ended December 31,
2000,  respectively.

All  options  granted  during  the six months ended June 30, 2001 and the twelve
months  ended  December  31,  2000 expire at the earlier of five years after the
vesting date of each option or six months after the termination of employment or
independent  contractor  agreement  for  vested  option  grants  only.

The  following  table summarizes information about stock option transactions for
the  periods  shown:

<TABLE>
<CAPTION>


                                    SIX MONTHS ENDED JUNE 30,        Twelve Months Ended
                                             2001                     December 31, 2000


                                     WEIGHTED      Weighted
                                      OPTION        AVERAGE        Option        Average
                                      SHARES    EXERCISE PRICE     Shares    Exercise Price
                                    ----------  ---------------  ----------  ---------------
<S>                                 <C>         <C>              <C>         <C>
Outstanding at beginning of period  2,760,000   $          1.21  2,412,503   $          1.94
Options granted                     2,235,000              0.28  1,150,000              0.71
Options canceled                      (42,500)             1.54   (802,503)             1.52
Options exercised                           -                 -          -                 -
Outstanding at end of period        4,952,500   $          0.76  2,760,000   $          1.21
                                    ==========  ===============  ==========  ===============
Exercisable at end of period        2,043,389   $          0.65    683,042   $          1.47
                                    ==========  ===============  ==========  ===============
Fair value of options granted       2,235,000   $          0.06  1,150,000   $          0.06
                                    ==========  ===============  ==========  ===============
</TABLE>

     Warrants

     On  June  26, 2001, in connection with the related to the acquisition of HI
the  Company  issued NRLP, a related party lender, a warrant to purchase 250,000
shares  of  the  Company's  common stock at an exercise price of $0.32 per share
with  an  expiration  date  of  June 26, 2006. The fair value of the warrant was
$15,000  and  was  accounted  for  as  additional  interest on the note to NRLP.

     On  June  25,  2001,  pursuant  to  the acquisition and merger with HI, the
Company  issued  1,407,587  warrants  to  purchase shares of common stock of the
Company at an exercise price of $1.19 per share with an exercise period expiring
October  2,  2003. The fair value of the warrants were $84,455 and was accounted
for  as  a  portion  of  the  fair  value  exchanged  in  the acquisition of HI.

     On June 25, 2001, pursuant to a financial consulting agreement, the Company
granted  Robert  Escobio,  also a director of the Company, a warrant to purchase
100,000  shares of common stock of the Company at an exercise price of $0.34 per
share  with  an  exercise  period  expiring June 25, 2004. The fair value of the
warrant was $6,000 and was accounted for as consulting fees over the life of the
agreement.


                                      F-23
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     On June 15, 2001, the Company issued a warrant to purchase 1,500,000 shares
of  common  stock of the Company at an exercise price of $0.39 per share with an
exercise  period  expiring  December  31,  2004  to  Silvano DiGenova, the chief
executive  officer  of  the Company and a related party lender, in consideration
for the extension of payment of the related party notes to December 31, 2004 and
for  maintaining  the  current interest rate throughout the extension period and
such  expense  will  be  recorded ratably as interest expense over the remaining
term  of  the  note  (see  Note  7).

     On  various  dates  throughout 2000, the Company granted to certain vendors
and  a  related  party lender 1,100,000 warrants to purchase common stock of the
Company  at  an  average  exercise  price  of $1.34 per share. The warrants have
vesting  schedules  that  provide  for  immediate vesting up to one year and are
exercisable up to three years. At December 31, 2000, vested warrants outstanding
are  875,000  at  an  average  strike  price  of  $1.00  per  share.

As  of  June  30,  2001, the Company had reserved shares of common stock for the
following  purposes:

                      Options                 4,952,500
                                             ----------
                      Warrants                4,357,587
                                             ----------
                      Convertible debt        7,530,303
                                             ----------
                                             16,840,390
                                             ==========

     Pro  Forma  Information

     Pro  forma information regarding net (loss) income is required by SFAS 123,
and  is  to be determined as if the Company had accounted for its employee stock
options  granted  during  2000 under the fair value method pursuant to SFAS 123,
rather  than  the  intrinsic  method  pursuant  to APB 25 discussed herein.  The
Company estimates the fair value of each stock option at the grant date based on
the  valuation  of an independent appraisal company.  Had compensation cost been
determined  based  on the fair value at the date of grant for awards in 2000 and
1999 consistent with the provisions of SFAS 123, the Company's net (loss) income
and  (loss)  earnings  per  share would have been equal to the pro forma amounts
indicated  below:


<TABLE>
<CAPTION>

                                                      Six Months ended     Twelve Months
                                    SIX MONTHS ENDED    June 30, 2000    ended December 31,
                                      JUNE 30, 2001      (unaudited)           2000
<S>                                <C>                 <C>              <C>
Net (loss) income -- as reported   $        (409,199)  $     (692,544)  $        (1,629,850)
                                   ==================  ===============  ====================
Net (loss) income - proforma       $        (513,299)  $     (703,194)  $        (1,670,832)
                                   ==================  ===============  ====================
Basic and diluted (loss) earnings
per share -- as reported           $           (0.02)  $        (0.04)  $             (0.09)
                                   ==================  ===============  ====================
Basic and diluted (loss) earnings
per share -- proforma              $           (0.03)  $        (0.04)  $             (0.09)
                                   ==================  ===============  ====================

</TABLE>

                                      F-24
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


10.     COMMITMENTS  AND  CONTINGENCIES

     LEASES

     The Company leases its offices under operating lease agreements expiring in
September  2004  and  Keystone leases its offices under non-cancelable operating
lease  agreements expiring in December 2002. The president and vice president of
Keystone  are  the  lessors  under  the  Keystone  lease.  Future minimum rental
payments  required  under  the  above leases as of June 30, 2001 are as follows:

         Years ending June 30
         2002                   $        349,991
         2003                            223,228
         2004                            163,970
         2005                             36,760
                                $        773,949

     Rent  expense  for  all  lessors for the six months ended June 30, 2001 and
2000  and  the  twelve  months ended December 31, 2000 was $84,968, $134,826 and
$264,729,  respectively. Of such amounts, rent expense to the president and vice
president  of  Keystone  was  $18,000 for the six months ended June 30, 2001 and
2000,  respectively, and $36,309 for the twelve months ended December 31, 2000 .
There  were  no  outstanding  amounts due to the president and vice president of
Keystone  at  June  30,  2001  and  December  31,  2000.

     EMPLOYMENT  AND  PROFIT  SHARING  AGREEMENTS

     On  June  15,  2001,  the Company entered into an employment agreement with
Silvano  DiGenova  whereby the Company will pay an annual salary of $375,000 and
bonus arrangements based on a sliding scale of 5% to 50% of base salary based on
a  corresponding  fiscal  year  consolidated  pre-tax income (as defined) of the
Company  from  $250,000  to $4,000,000, a bonus of 25% of base salary payable in
the  Company's  common  stock  if  market capitalization of the Company's common
stock  exceeds  $50,000,000 for a specified period and a bonus of 5% of the base
salary  payable  in  the Company's common stock if average market capitalization
increases by 20% over the average market capitalization of the prior fiscal year
subject  to  certain  limitations.

                                      F-25
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     On  June  15,  2001,  the Company entered into an employment agreement with
Michael  R.  Haynes,  president  of the Company, whereby the Company will pay an
annual salary of $169,000 and bonus arrangements based on a sliding scale of 10%
to  5%  of  fiscal  year  consolidate pre-tax income (as defined) of the Company
subject  to certain limitations and payable 25% in cash and 75% in the Company's
common  stock,  a  bonus  of  25% of base salary payable in the Company's common
stock  if  market  capitalization  of  the  Company's  common  stock  exceeds
$100,000,000 for a specified period and a bonus of 5% of the base salary payable
in  the Company's common stock if average market capitalization increases by 20%
over  the  average  market  capitalization  of  the prior fiscal year subject to
certain  limitations.

     On  June  15,  2001,  the Company entered into an employment agreement with
Richard Viola, secretary of the Company and president of HI, whereby the Company
will  pay an annual salary of $135,000 and bonus arrangements equal to 5% of the
base salary if the quarterly net income of HI (as defined) exceeds the budget of
HI  for  such  quarter  and  a  bonus  equal  to  5%  of  the base salary if the
consolidated  net  income  of  the  Company  is  more than 5% of the consolidate
revenue  of  the  Company.

     In  connection  with  the $1,000,000 convertible note payable (Note 7), the
Company  agreed  to  provide  additional  compensation to the related party note
holder  in  the  form of profit sharing calculated as 25% of TCI's income before
income  taxes,  as  defined, which amounted to approximately $85,234 for the six
months  ended  June  30,  2001.

     In  December  29, 1999, the Company entered into employment agreements with
Stephen  J.  Gehringer and Kenneth J. Kellar who were two of the previous owners
of the Company's Keystone subsidiary and who are currently the president and the
vice-president  of  Keystone.  The  agreements  provide for base compensation of
$120,000  per  annum each and a profit sharing arrangement whereby each of these
officers will earn 25% of Keystone's income before amortization for goodwill and
income taxes, as defined. The agreements commenced on January 1, 2000 and expire
on  December  31,  2002.  In January 2001, both of the aforementioned employment
agreements  were amended to $150,000 annual compensation with an increase in the
profit  sharing  arrangement to 40% for each officer of Keystone's income before
amortization  for  goodwill  and  income  taxes, as defined.  For the six months
ended  June 30, 2001 and the twelve months ended December 31, 2000, Keystone had
income of approximately $173,656 and $394,000, respectively, before amortization
for  goodwill,  income  taxes and the effect of this profit sharing arrangement.
As  a  result,  the  profit  sharing  component  of  the  executive compensation
aggregated  $138,925 and $197,000 for the six months ended June 30, 2001 and the
twelve  months  ended  December 31, 2000, respectively. Any unfunded portion was
accrued  in  Accounts  Payable  and  Accrued  Expenses.


                                      F-26
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

2000  OMNIBUS  STOCK  OPTION  PLAN

On  August  1,  2000,  the  Company's  Board  of  Directors approved, subject to
shareholder  approval  which  was  obtained,  a stock option plan to attract and
retain  competent  personnel  and  to  provide  to  participating  officers,
directors,  employees  and  consultants  long-term  incentive for high levels of
performance  and  for  unusual
efforts  to  improve  the  financial  performance  of  the  Company.  The  Plan
provides  for  both  incentive  stock  options  specifically  tailored  to  the
provisions  of  the  Internal Revenue Code and  for  options  not  qualifying as
incentive  stock  options.  Employees  and consultants of the Company, including
officers  and  directors,  are  eligible  to  receive  options granted under the
Plan.  The  shares  subject  to  the  options  will  generally be made available
from  authorized,  but  unissued  shares.  The  Plan  will  be  administered  by
the  Board  of  Directors  ("Board").  The  Board  has  full  authority to award
options  under  the Plan, to establish  the  terms  of  the  option  agreements,
and  to  take all other action deemed  appropriate  for  administration  of  the
Plan.

     CONSULTING  AGREEMENTS

     The  Company  has entered into financial consulting agreements with related
parties  that  provide  for monthly payments for services and in some cases, for
finder's  fees  if  equity or debt is obtained by the Company as a result of the
efforts  of the consultant. Payments in the aggregate of $22,500 per month under
these  agreements  commence  July  2001  with  terms  from  one  to three years.

     On August 6, 2000, the Company entered into a consulting agreement with RLH
Enterprises,  Inc.  ("RLH")  to  render  services  relating  to  all  activities
encompassing  the  purchase,  marketing  and sale of rare coins on behalf of the
Company  on an exclusive basis.  The agreement provides for a compensation based
on  the  greater  of  a  guaranteed  fee of $285,000 per year or 37.5% of income
before  taxes,  as defined in the agreement, for the operations of TCI.  For the
six  months  ended  June 30, 2001 and the twelve months ended December 31, 2000,
such  compensation  was  approximately  $175,119  and  $118,000.


GUARANTEED  LIQUIDATING  AND  BUY  BACK

The  Company provides a Guaranteed Liquidity and Buy Back at Grade warranty (the
"Guarantee")  to its retail rare coin customers. Retail rare coin sales amounted
to  $6,856,607  and  $8,287,067  for  the six months ended June 30, 2001 and the
twelve  months  ended  December  31,  2000,  respectively. The policy grants the
customer  the  opportunity  to  sell  their  coins  back  to  the Company at the
prevailing  market  "bid"  (below  the  current  wholesale  price).  The Company
determines  the  "bid"  price  based on the prevailing market price at which the
Company  believes  it  could  readily liquidate the coin. The "bid" price may be
substantially  below  what  the  customer  originally  paid  for  the  coin.

The  values  of  the  rare coins sold to retail customers continually fluctuate.
Furthermore,  retail  customers continually resell or trade coins purchased from
the  Company  with third parties. Once retail customers resell the rare coins to
third  parties,  the  Guarantee  is  void.  Lastly,  the Company has had minimal
historical  experience  with customers exercising the Guarantee. As a result, it
is not possible for the Company to determine the potential repurchase obligation
pursuant  to  the  Guarantee  that  it may be subject to as a result of previous
sales  of  retail  rare  coins.

                                      F-27
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

PROFIT  SHARING  PLAN

The  Company's  profit  sharing  plan  covers all employees who have met certain
service  requirements.  Contributions  to  the plan are at the discretion of the
board  of directors each year; however, contributions can not exceed 15% of each
covered  employee's  salary.  Keystone  maintains a separate profit sharing plan
with  discretionary  contributions  by  the  employer. Contributions made to the
plans  on  a  consolidated  basis for the six months ended June 30, 2001 and the
twelve  months  ended  December 31, 2000 were $28,725 and $87,811, respectively.

LEGAL  PROCEEDINGS

The  Company  may  from  time  to  time be involved in various claims, lawsuits,
disputes with third parties, actions involving allegations of discrimination, or
breach  of  contract  actions  incidental  to  the  operation  of  its business.

Prior  to  the  Company's  acquisition,  HI  was the defendant in a lawsuit that
alleges  breach  of  contract.  The  Company's counsel has reviewed the case and
without  admitting  any  responsibility, counsel has advised that it is probable
that  the  Company's  subsidiary  may  have  a  financial liability of $100,000.
Accordingly, the financial statements of the Company have accrued such amount to
record  this  contingency.

Other  than the matter described above, the Company is not currently involved in
any such litigation with it believes could have a material adverse effect on its
financial  condition  or  results  of  operations.

11.  BUSINESS  COMBINATIONS

ACQUISITION  OF  HOTELINTERACTIVE

On  June  25, 2001, the Company acquired all the outstanding common shares of HI
by  merging  HI  with  and  into  a  newly formed wholly owned subsidiary of the
Company  with  HI  as the survivor. Pursuant to the merger, the Company acquired
100%  of  the  outstanding shares of HI in exchange for 18,755,345 shares of the
Company's  common  stock  valued at $0.182 per share and warrants to purchase an
aggregate  of  1,407,587  shares of the Company's common stock valued at $84,455
for  a  total  investment  of  $3,497,928.

The  acquisition has been accounted for under the purchase method of accounting.
In  connection  therewith,  the Company acquired net assets of $1,201,157, which
included  cash,  accounts  receivable,  computer  equipment,  software, customer
lists,  accounts  payable and a contingent liability.  Goodwill in the amount of
$2,296,771  was  recorded  as  a  result  of  the  acquisition  (Note  4).

Unaudited pro forma results of operations for the six months ended June 30, 2001
and  the  twelve months ended December 31, 2000, as if HI had been combined with
the  Company as of January 1, 2000.  The pro forma results include estimates and
assumptions  which  management believes is reasonable, including an estimate for
amortization  of  goodwill  based on the Company's existing accounting policies.
However, pro forma results do not include the effects of the planned integration
of  HI  and the Company, and are not necessarily indicative of the results which
would  have  occurred if the business combination had been in effect on the date
indicated,  or  which  may  result  in  the  future.




                                      F-28
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


                                      Proforma Statement of Operations


                                       Six months        Twelve months
                                          ended              ended
                                      June 30, 2001    December 31, 2000
                                     --------------   ------------------
Net sales                            $   17,824,591   $       29,748,503
                                     ==============   ==================
Net loss                             $     (961,469)  $       (4,272,510)
                                     ==============   ==================
Weighted average shares outstanding      37,510,643           37,294,453
                                     ==============   ==================
Net loss per share                   $        (0.03)  $            (0.11)
                                     ==============   ==================

12.     SUBSEQUENT  EVENTS

     ACQUISITION  OF  SUPERIOR  GALLERIES,  INC.

     On  July  6,  2001, the Company acquired substantially all of the assets of
Superior  Galleries, Inc., a company that is an auctioneer of rare coins located
in  Beverly  Hills,  California  for  $200,000  in  cash and a note for $701,000
payable  over  six  months.  The  Company  placed those assets in a newly formed
wholly  owned subsidiary which was named Tangible Acquisition II, Inc., a Nevada
corporation.  Pursuant  to  the  asset  acquisition  agreement, the Company also
purchased  the  name "Superior Galleries" and such agreement required the seller
to  change  corporate  names,  which  allowed  the  Company  to  rename Tangible
Acquisition  II,  Inc.  (a  Nevada  corporation)  to Superior Galleries, Inc. (a
Nevada  corporation)  ("Superior").  The  seller  retained certain rights to the
Superior  name  in  the  stamp and space memorabilia markets for a period of two
years  from the date of the acquisition, and as a result, Superior is restricted
from  doing  business  in either the rare stamp or space memorabilia markets for
such  period.

     Pursuant  to  the acquisition, the Company was required to grant a guaranty
of  the  note  issued  by the wholly owned subsidiary Superior to the purchaser.
Also  required  in  the  transaction was a personal guaranty of such note by the
Company'  Chief  Executive  Officer  Silvano  DiGenova. In consideration for the
personal  guaranty,  the  company paid Mr. DiGenova a fee of 2% of the amount of
the obligation that was the subject of the guaranty and granted a warrant to Mr.
DiGenova  to  purchase  1,402,000  shares  of  the  Company's common stock at an
exercise  price  of $0.21 per share with an expiration date of July 6, 2006. The
fair  value  of  the  warrants  issued  to Mr. DiGenova will be accounted for as
interest  expense  ratably  over  the maturity of the note issued to the seller.

In  addition  to  the  above,  the  seller agreed to provide a $3 million credit
facility  to  Superior specifically to provide financing for advances of auction
proceeds  to  consignors.  The  Company was also required to grant a guaranty of
this  obligation  of  its  wholly owned subsidiary Superior and Mr. DiGenova was
also  required to grant a personal guaranty of such obligation. In consideration
for  the  personal  guaranty,  the  company granted a warrant to Mr. DiGenova to
purchase  1,500,000 shares of the Company's common stock at an exercise price of
$0.35  per  share with an expiration date of July 6, 2006. The fair value of the
warrants  issued  to  Mr.  DiGenova  will  be  accounted for as interest expense
ratably  over  the  maturity  of  the  note  issued  to  the  seller.


                                      F-29
<PAGE>

                         TANGIBLE ASSET GALLERIES, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     GRANTS  OF  WARRANTS  AND  ISSUANCE  OF  COMMON  STOCK

On  July  3, 2001, in connection with the issuance of a note, the Company issued
KSH  Investment  Fund, LLP a warrant to purchase 500,000 shares of the Company's
common  stock at an exercise price of $0.23 per share with an expiration date of
July  3,  2006 valued at $30,000. Also pursuant to the issuance of the note, the
Company  issued  500,000  shares  of  the  Company's  common stock valued in the
aggregate  at  $85,000. The fair value of the warrants and the common stock will
be  accounted  for  as  interest  over  the  life  of  the  note.

     PRIVATE  PLACEMENT  OFFERING  OF  PREFERRED  STOCK

On  July  6,  2001,  the Company commenced a private placement of Series A $5.00
Redeemable  8%  Convertible  Preferred  Stock  ("Series A Preferred Stock"). The
Series  A  Preferred Stock carries an annual dividend of $0.40 per share payable
quarterly  in  cash or common stock of the Company at the Company's election, is
convertible  into  11 shares of the Company's common stock and provides for cash
redemption  or conversion into common stock of the Company based on elections by
the  holder  or  by the Company with certain contingencies. The Company has sold
$575,000  of  the  Series  A  Preferred  Stock  and unless otherwise extended in
accordance  with  its  terms, the offering is to close on October 31, 2001. Upon
closing,  the  Company  has  the  obligation to file an appropriate registration
statement with the Securities and Exchange Commission covering all of the common
shares  issuable  in  accordance  with  the  terms  of  the  offering.





                                      F-30
<PAGE>