Grading coins

[cmerc]

This is a very interesting thread, though I am joining the conversation a bit late.  Originally grading started by ANACS ONLY FOR AUTHENTICATION PURPOSES.  However, as investors started to enter the rare coin market, a need emerged to remove subjectivity and assign a standard value to coins.  This was mainly for the benefit of non-expert investors and traders, NOT COLLECTORS.  Hence the birth of numeric grading.  I hardly see the difference between a 'MS-63' and 'MS-64'.  But the price difference can be thousands of dollars, or even more ridiculous. 

I am an opponent of third party grading.  It does not benefit collectors.  I agree with Arthur (akona).

[villa66]

...I hardly see the difference between a 'MS-63' and 'MS-64'.  But the price difference can be thousands of dollars, or even more ridiculous. 

I am an opponent of third party grading.  It does not benefit collectors.  I agree with Arthur (akona).

Sending coins away to be graded by a third-party is definitely one way to grade coins, but I was really hoping we could talk about how we grade them ourselves, and about the grading guidelines we use (or perhaps will use).

But briefly, on the subject of third-party grading, I agree with you about hardly seeing a difference between MS63 and MS64, and when akona20 talks about the games that go on with third-party grading I'm definitely in his (and alglasser's) corner. (I thought alglasser's last post, especially, was really worthwhile.)

If MS60 is defined as (just) Uncirculated, and MS70 as "Perfect" Uncirculated, then we know that there is a continuum of coin condition between MS60 and MS70, and we know that MS63 and MS64 are two different points within that range. Makes logical sense. But can we consistently see the difference between these two points? I can't--but then that's not the kind of collecting I'm personally interested in, and besides that, I know there are collectors out there who are a lot more discerning than I am. So I'm more than willing to accept the idea that third-party graders and some collectors--and investors--are playing games that I want no part of--but then I also know there are third-party graders and some collectors--and investors--who are able to see things in coins that I can't.

But I can consistently see the difference between the major stopping-places that are commonly used: MS60 (Uncirculated), MS63 (Choice Uncirculated), and MS65 (Gem Uncirculated). And MS70, or nearly so? I think I can see that too, and do with some regularity, in some of the world's Mint Sets. (The British, apparently, and some other folks too, call them "BU." )

Anyway, these are differences in UNC coins that even I can see, and among the major third-party graders at least, what I see slabbed pretty much comports with the understanding I have of these grades.

As cmerc so correctly points out, the original purpose of third-party grading was to authenticate; it's something they do still, of course. And the occasional horror story notwithstanding, competent third-party authentication is becoming more and more useful (worldwide) all the time. (To investors surely, but also to collectors.)

And then there's that other undeniable benefit to collectors rendered by competent third-party graders...AU58!!

  v.

[akona20]

I was brought up in a system that valued strike as the main criteria where the American system values surfaces as the main criteria.

So my way of looking at things is somewhat a market grade and the other way is a technical grade.  Market grade has a large element of technical in it but there are differences. A technical grading may accept a high grading for a coin that cannot be fully attributal ( I have seen examples of hand struck coins with elements missing receive realtively high grades for example where they should be marked down in market grading).

Given th research I am currently involved in any coin for some mints within rulers is absolutely acceptable because it might be the only one ever found to date.

There is a misty eyed thought that the origins of the slabbing type grading was only for authentication. Well folks if that was the case authtication would remain as such if i wanted authentication I would send it elsewhere than the grading groups.

Aim one for me if I am buying a coin and I have never been in the machine made market is to get a coin that has all the elements necessary to FULLY attribute it. When coins of this nature are found it becomes a budget and negotiating exercise as to which one I buy.

Machine made coins are generally easy to identify and are available by the truckloads, well most of them, and so collectors like to differentiate by how good their coin is graded rather than an exercise in actually finding the coin they are searching for. When you buy you know and when you sell you have a good idea of what you should get. That is why, in general, graded coins should be sold at auction if you are the seller.

Frankly if ever I go to another auction and listen to the bellyaching about grading I swear mayhem will happen. A common coin is made rare by its grading. So coin X might be common by a coin of 65 grade is rare and commands a high pice. In my book that doesn't make the coin rare folks. The mints in many countries are now doing a great job in producing extremely high quality coins for collectors (choke investors lol) so we know how many of each grade has been produced. Well some mints run there own little backdoor show but essentially we know. So over time grading will become an exercise in futility for the great numbers game.

[Alan Glasser]

Hello everyone. It is a real treat reading such wonderful and knowledgable posts on this topic. It's interesting that the same arguments that I remember 20...30 or more years ago are still in "vogue". I wonder if I will be around to see a resolution to this issue???

I made a dash to the bank today and while there, pulled out the Barber Half dollar and the Draped Bust dollar I mentioned in my earlier post in this topic. I have scaned and posted the coins below. Again, the scans aren't the best, but I hope you can get a sense of what I am trying to show.

In that post I explained that my U.S. Barber Half was submitted for me to NGC. As the dealer promised, NGC did slightly improve the "eye appeal" of the coin as the toning was darker and uneven. It looks pretty good now...but the moral issue remains...should it have been cleaned by a certifying agency?

The other scan is of my 1803 U.S Dollar. Though certified by PCGS, it is clearly cleaned. I read somewhere that because such a high percentage of U.S. early dollar coins WERE cleaned by previous owners, that there is some sort of exception for this type of coin as far as being accepted for certification by PCGS.  If anyone has some verification of this, I would appreciate it if you could let me know where that informatiuon is available.

Good day, everyone.   Alan in Massachusetts





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[villa66]

...There is a misty eyed thought that the origins of the slabbing type grading was only for authentication. Well folks if that was the case authtication would remain as such if i wanted authentication I would send it elsewhere than the grading groups.

...Machine made coins are generally easy to identify and are available by the truckloads, well most of them, and so collectors like to differentiate by how good their coin is graded rather than an exercise in actually finding the coin they are searching for....

The slabbing didn't appear until somewhat later. It is as cmerc has said, that third-party had its roots in a desire to authenticate coins. Some of the earlier efforts of ANACS--begun by and then still owned by the non-profit American Numismatic Association--appeared in this note I made to myself years ago dealing with U.S. 3-dollar coins of 1854-89:

"These have been counterfeited very heavily. Feb '75 N lists the series members submitted to ANACS f/authentication. Some shocking stuff. 1882 was the worst, w/just 2 of the 66 submitted being genuine. 3% good, 97% bad--and these from the people least likely to be fooled."

v.

[Alan Glasser]

Hello, Villa66 and everyone.

Your post demonstrates exactly why when I was after a $3 gold, it HAD to be certified. I bought mine from Heritage Rare Coin Galleries in Texas, U.S.A. when I was employed by them. It had already been certified. I read in varied grading books that the $3 pieces were often copied, but I had NO idea that the percentages were so high!! As 1882 had such a huge percentage of fakes, I wonder if they were done by just 1 "enterprising gentleman?

Alan   Massachusetts

[Alan Glasser]

I may be beating the topic of "Slabs" to death but I had another interesting "encounter" with NGC when I was having better pieces I obtained in Peru certified. (I had 4 free slabs for subscribing to the NGC Club...which I recommend highly for U.S. collectors.)

Anyway, please bear with me while I post another "slab" (or lack thereof). This piece is a rather decent 1823 Lima Peru 8 reales that I obtained somewhere between 1975-79 while my wife and I were employed in the extreme south of the country. This piece and several others came from a hoard in the bottom of the jewelry dealer's display cases and was sold to me at silver melt IF my wife spent a minimum amount on jewelry. (Not a problem, believe me!) Silver was at about $4 to $5 an ounce if I remember correctly. I was in HEAVEN!!! Anyway, many years later I submitted it to NGC. To my disappointment, it came back as a "Planchet Flaw" example. I didn't realize that this was a distinction making the coin ineligible for certification. I mean, it wasn't cleaned, damaged, or a counterfeit and "Planchet Flaw" is a minting issue from a defective planchet. I'm  not quite sure why it was rejected for certification but nonetheless, it remains a favorite from my Peru Collection. The planchet flaws are most prominant at 12:00 on the reverse, and a bit at 9:00 also on the reverse.

If it is of any interest, I have 2 U.S. pieces slabbed by SEGS that came back as having a totally different description when I submitted them to PCGS. They were "rejected" by PCGS and are still in the SEGS holder. (SEGS is now a dirty word on E-Bay and the hard core slabbers). I could scan them and maybe generate yet MORE discussion on the certification issue. SEGS was supposed to have some very respected professionals in the grading department so I was somewhat upset at the result. I can post scans if there is interest, next time I hit the bank. Could this be a case of one company not wanting to credit the work of another??? I don't know...maybe never will.

Not a quite as upset as I was when my SEGS Fine 15 1795 U.S. dollar came back from PCGS as "Counterfeit". THAT little bit of history caused quite an uproar as I MADE it an issue to SEGS and advised several professional numismtic organizations. The coin is now in the possession of the Federal government and SEGS refunded approximately 1/3 of the then current retail value (decent of them really because the warranty period offered by SEGS had long expired). In addition, my plight caught the attention of some serious professionals and they pressured another numismatic organization to reimburse me an additional sum so that I almost broke even. I WAS heartsick, however, at the loss of my 1795 dollar. I have never replaced it and now the prices are prohibitive. 

Can you see why I am not enamored of slabbing anymore???

Alan   Massachusetts





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[villa66]

I'd say you've earned the right to your disenchantment, and done it the hard way. That's some tough stuff. Hate especially the 1795 dollar episode. (I lost a '23 Peace to theft as a boy decades ago and it still rankles; I cannot even imagine losing a Flowing Hair dollar, whatever the circumstances.)

If it's ever handy, sure, I'd like to see the two SEGS coins that PCGS dissed.

About the 3-dollar gold fakes identified by ANACS, as published in The Numismatist of Feb '75--according to my old notes anyway--there were several dates in addition to the 1882 that were of special concern: 1854, 25 of 40 were good; 1855, 8 of 51 were good; 1857, 1 of 17 was good (yikes!); 1867, 1 of 8 was good; 1874, 24 of 41 were good; 1877, 1 of 9 was good; 1878, 33 of 66 were good; 1885, 3 of 6 were good; and 1888, with just 5 of the 29 submitted being good.

I can't imagine numbers like these wouldn't give anyone pause. One thing's for sure: against odds like these, collectors need all the help they can get.

One last note; your 1823 Peruvian 8-reales is gorgeous. As if you needed anyone to tell you. What a wonderful gray. If it were mine I'd tell the grading company to go take a hike, and then I'd sit around all day looking at it. Nice!

  v.

[Alan Glasser]

Good morning/evening Villa66 and everyone.

Villa66, here are the 2 pieces that SEGS certified for me (when I still had faith in them) and when I decided to move all my certified pieces to PCGS, here are also the results I received. Both coins are dark so I am sorry for the lack of details in the scans. I don't know who, if either company is correct in their determinations but it was one more "punch in the gut" turning me off of slabs and U.S. type collecting as a whole (that and prohibitive prices for the next "steps" in the collection). And yes, I am still upset at the loss of my 1795 dollar as you are for your Peace dollar. I don't expect that I will ever buy another. I understand that PCGS will now "slab" damaged/cleaned coins as "genuine". I don't see the point in resubmitting them but it would be VERY interesting to crack them out and see what they receive as re-evaluations from PCGS. I won't waste the $50 though. The dilemma this creates is that when I eventually sell the coins, how do I honestly describe them?

Oh Villa66, many thanks for the kind words about the Peru 8 Reales piece. It was a favorite when I picked it out of the thousands of coins in those jewelry showcases...and remains so. The question is, "is a planchet flaw" grounds for non-certification? (We call it "body bagging".)

Alan   Massachusetts



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[villa66]

"The question is, 'is a planchet flaw' grounds for non-certification?"

You know, I really can't imagine this question ever needing to be asked--but you've shown us why it came up. So I guess I'll just say what seems to me to be the obvious: a planchet flaw is an integral part of the coin--I mean, how could it be anything else? We're often reminded of "adjustment marks" and how their presence was once just a part of the normal coining process; as such, early American coins with "adjustment marks" receive third-party grades quite routinely. What are "adjustment marks" if not planchet flaws, or at the very least, evidence of a planchet flaw having been addressed?


"The dilemma this creates is that when I eventually sell [these two half-cents], how do I honestly describe them?"

Admirable question. Really. Because we know it wouldn't be something that troubled a lot of the people in and around the coin hobby. (And ironically, since it's a part of this particular thread, it's exactly the sort of question that it was hoped third-party grading would always resolve.) Anyway, my solution--altogether too glib given your own long experience, I know--would be to go with the SEGS description if you agree with it, and if not, to crack out the coin and describe it the way you see it. It isn't a suggestion that would work for everyone, but it's a suggestion I'd make to anyone who was even moderately diligent in learning how to grade coins.

Thanks for the look at some cool coins, even if the slabs do make them hard to photograph. Seeing the dueling verdicts is a good lesson for the rest of us.

  v.

[Alan Glasser]

Hello, Villa66. I very much enjoyed your post on the "planchet flaw" issue. I am in full agreement that early U.S type is often certified by the 2 most respected certifying agencies. I don't own any pieces in this category but I am essentially sure I have seen them offered and described as such. (Someone PLEASE correct me if I am wrong.) Perhaps NGC has revised its policy in recent years? I don't know. I doubt that I would resubmit the coin in any event.... but if NGC "found me...."

Regarding the differing opinions of the 2 different "slabbers", (SEGS and PCGS) well...this IS interesting. There are so many variables in coin grading I guess I can understand some difference of opinion...but these 2 examples are VERY different in their opinions of the coins. I did try this afternoon to photograph the coins so as to offer better images here, but I need more practice. I had problems with poor focus and shadow...not to mention the glare from the slabs. I think there is potential with "raw" coins, however. Now I HAVE seen here, some excellent images of coins in slabs so I know it's possible.

Finally, thanks you for your very kind words about the ethics of describing the 2 slabbed coins if I ever were to sell. Do I crack them out and try 1 more time with PCGS, or maybe NGC? (It would indeed be very interesting to the opinions of a THIRD  company!) To be honest, my current thinking is that the only reason I would do this IS for purposes of sale and I don't think the value of the coins really justifies $25 U.S. for a new opinion. I think I will probably just keep them as is, and when they pass on to my son, with both opinions, and it will be the decision of the auction house to whom he consigns the collection. (I have already picked the company and left the information with my son.) They certainly will know far better than I what to do.

Out of curiosity, I just checked to see if SEGS is still up and running and I believe it is; at least they are still online. There is a most impressive list of numismatists/graders on staff. This all is indeed a quandry. It's too bad there isn't some sort of consensus relationship between companies when there is a wide difference of opinions. That would really be a tremendous benefit to collectors when a question like that of these 2 coins comes up, not to mention the previously mentioned (earlier post) of my sorely missed 1795 Dollar certified as VF 20 cleaned (I found my saved photos) by SEGS and determined to be a counterfeit by PCGS.   

Just wishing out loud I guess, but wouldn't it be terrific and very educational for us all if someone had a connection with a few of the grading services and they would possibly address some of the issues that have come up from participants here to this column? Maybe I am speaking out of turn, but I would really benefit from hearing about the current thinking and standards of the well respected certifying companies.

All the best to everyone from FRIGID Massachusetts. [/size][/color]  Alan

[Alan Glasser]

Hello Villa66...and everyone. Greetings from below 0 degree Massachusetts, U.S.A.  IT'S COLD!

Anyway, I may be kicking a dead horse, but in browsing this evening through the Heritage Rare Coin Gallerey auction catalog of February 7,8, 10, 2013. I found a listing for a NGC slabbed coin with "planchet flaws". If anyone is curious, it is item # 3058, a 1793 Wreath Cent. Well, the coin is very exciting, but I wonder how IT got "slabbed" and my lowly Peruvian 8 reales 1823 got "body bagged". Has there been a policy change...or...does the value of the coin determine how it will be handled by NGC? I don't know...but I would love to find out. Are there any NGC experts out there?
All the best to everyone.  Alan  Massachusetts 

[akona20]

Given what is being slabbed now I can see no reason why a planchet flaw should not be graded.

[Alan Glasser]

Hello akona20 and everyone.
Akona, my apologies for the delayed response to your short but important post:

Posted by: akona20
« on: 25-01-2013, 20:07:12 »Insert Quote

"Given what is being slabbed now I can see no reason why a planchet flaw should not be graded".

Well, I thought quite a lot about this and I believe I can answer the riddle. The certifying agencies are slabbing anything these days because there is not much left that is out there that is worth certifying! I would imagine a vast majority of the U.S. rarities have already been put in their "plastic coffins" by now as well as many beautiful and rare world coins. There is a finite number of coins "worth" slabbing and I bet that the supply has nearly run dry...maybe not...but that is what I'm thinking. So now...we are overrun with "first strikes", "special issues", medals, (don't get me wrong...I have no problem with medals!!!) cleaned, damaged, holed coins, better than average common mint products (MS 68, 69...)...and as I stated in the post prior to this one "coins with planchet flaws"....along with every other malady under the sun. My theory is that when I submitted the Peru 8 reales of 1823 some years ago, it got a "body bag" because there must still have been a steady supply of worthy material coming in to NGC (and others) but when it slowed to a trickle...they had to lower the requirements. I have since seen slabbed "planchet flaw" coins in a recent Heritage Rare Coin Gallery auction. (excellent company, by the way!) Just a theory...but when a product becomes in short supply, you had best broaden the standards in order to "make a buck". I would love to be a "fly on the wall" as they say...to see what kind of material is coming in to the certifying agencies these days.

In a way I am glad that the guidelines have changed over the years (I assume) and the standards have been progressively lowered. I was in my U.S. type set  (1793-1946) craze when PCGS used green labels. Green labels now sell for a premium over the blue labels that followed them (or used to...I am far removed from the market in certified U.S. material now). I have a bunch of "green labels".

So I asked myself, WOULD I have a coin certified now? Well...if it was a rarity or if there was a concern about it being genuine or an exceedingly high grade for the type...I would consider it, but I do not anticipate any of the above coming my way any time soon. I have precious few Music Coins that I would submit (I did send in a few gold pieces years ago) and my U.S. type set is already entombed in plastic. Now again, because the fakes are becoming ever more common in the marketplace, it might be prudent to "send the coin off" for the opinions of the 3 (or is it 4?) professionals who examine each piece before reaching consensus.
 
I just bought off of e-Bay a very reasonably priced roll of U.S. 1 cent coins of 2009 with the Log Cabin reverse. They are in beautiful condition. Gee...if I paid $25 each (I think) for slabbing, I bet a lot of them would come out as MS 67, 68...maybe 69??? If I sent in the coins, that would keep the "office" busy for an hour or 2, putting essentially valuless coins in slabs at $25 each. Gee...what a deal! The sad thing...some people would buy them....I imagine...but for far less than that.

Alan   Massachusetts

[akona20]

Well "slabbing" is a fashion among a group of active traders. Fashions come and go.

The statement "Oh I see it is not graded so you will get a lower price" still occurs but seemingly without the consistency of a few years ago.

They are still pushing reasonably hard to make inroads into the ancient coin area though I recently heard a good line: "Oh what a lovely coin, pity it's not graded no one important will believe it is genuine."

By "important" I take it that money people without knowledge will not buy it. It comfortably made a correctly set reserve plus 25%.