Guilty as Charged

[coinsbygary]

I was snared by my own desire to populate a registry set to buy the plastic rather than the coin.

 

I work in an industry where companies compete for what is called market share and since I work in the cell phone industry, the pool of potential new customers without cell phones is small and dwindling. Therefore, if you look at the cell phone market as a pie, the only way for my company to grow is if it can take a bite out of another's piece of the pie. For the most part, AT&T and Verizon are the 900-pound gorillas that are taking bites out of each other, and everyone else that is left. Unfortunately, for consumers, what the government has seen fit to bust up, the industry has managed to put back together. Before long there will only be a handful of companies left, and the consumer will be the one who is left out to dry.

 

I think you can see where I am going with this; in order for PCGS and NGC (the numismatic 900-pound gorillas) to grow and compete, they must increase their market share of graded coins. Where collectors often sour on grading companies is in the fact that the certified coin industry is big business. However, like it or not, third party graders are in business to make money. Yes, third party graders perform a great service for the collecting community, but they are for-profit organizations which, in and of itself, is not wrong as long as they remain ethical.

 

This now is where I digress into my opinion and only that. I believe that a large portion of NGCs and PCGS's business is through bulk submissions by dealers. One way for NGC and PCGS to compete is through the fees they charge to certify their customer's coins. However, there is another way for them to compete with each other that is much more subtle. Everyone knows that the higher the grade, the more the dealer can charge to the collector for the coin. As a result, if I were making a bulk submission for eventual resale, I would look for the grader who gives me the best grades. This has resulted in what I believe is a softening of the conservative grading standards of the past in order to compete for increased market share. Unfortunately, this affects the end consumer of coins, the individual collector. The pendulum will only swing back when enough collectors have had enough. Enter CAC acting as the arbiter of the swing back to more conservative grading. However, the market is much larger than the coins CAC sees, meaning it is up to the collecting community as a whole to put their foot down and refuse to buy substandard products. Yes, certified coins are the products of the companies certifying them.

 

Now there is no way for me to prove the points I made in the previous paragraph since all third party graders have strict policies of the grader not knowing the identity of the submitter. Furthermore, graders are not allowed to be commercially involved in the buying and selling of coins. However, through my recent buying experience and subsequent research I believe that at the very minimum, they are unintentionally responding to market pressures. Then of course, there is the seeming randomness of human subjectivity in spite of the fact that all graders are professional Numismatists with many years of experience. Interestingly, the many crossovers and resubmissions prove that submitters believe that if they send their coins in enough times they will eventually get the grade they are seeking.

 

All that I just stated premises my own personal experience. If you want to say that I bought the holder rather than the coin, then I plead guilty as charged. I am only sharing my experience with you in the hope that you will be reminded that its about the coin, not the plastic.

 

Rather than collecting Silver American Eagles, I collect Silver Great Britain Britannias. My goal for the set is that they all grade MS-69 or higher. You may think that a grade of MS-69 is an easy goal to obtain, but it is extremely difficult. Because of handling and packaging at the Royal Mint, most of the coins display some sort of surface abrasions. In the four years I have been collecting these, I have four coins grading MS-68 and with my recent purchase, fourteen grading MS-69.

 

Now I have a friend, who collects these and I cover his back and he mine by giving each other market alerts. Last year, he notified me of a dealer selling 2012 NGC MS-69 examples of this coin. Subsequently, I bought one sight unseen and was very happy with my purchase. This year he notified me of a different dealer offering the 2013 version of the coin at MS-69 and naturally I jumped on it sight unseen.

 

This year though is quite a different story, because right out of the box the very first thing I noticed was a coin with very distracting surface abrasions. As I have previously stated I have been collecting these for years and have submitted more than just few coins for grading in search of the ever-elusive MS-69. Let me tell you I have had MS-67 and MS-68 submissions that looked better than this coin! To say I was very disappointed is an understatement.

 

This is when I decided to do a little research to see if returning the coin for another would benefit me. Interestingly, my coin was one of twenty-six coins in a submission with ALL the coins grading MS-69 according to the population report. I thought to myself; why not see what the rest of the coins look like through NGCs coin verification. To my horror, all the coins I saw there had surface abrasions also. Now what do I do? Well for now, I will hold the coin until I SEE a suitable replacement. I noticed another collector (not my friend) selling a coin from the same submission on E-Bay that I am currently tracking for the purpose of seeing what price he gets for his coin.

 

In summary, I guess you can be in this hobby for forty years and still have to take the bitter medicine of a hard lesson learned. Though I am currently disappointed with NGC, I still prefer them. I have nothing against PCGS, but it is NGCs inclusive US registry and in my opinion superior collector webpage that sells me on them. I also like NGCs boards and I like the Collectors Society journaling feature. I am also including a photo of peoples exhibit number one. Notice the abrasions on Britannias skirt and shield, the rub marks on the pleats of her skirt, and the cloudiness in the field around her trident. I think you will agree with me that this is no MS-69

Gary

 

See more journals by gherrmann44

[Merlin8*]

Interesting thoughts, but what really peaked my interest in your article was the blacked out certification numbers on your photo, Of all the photo editing I've seen on this site that is a first, for me at least.

 

just wondering why someone would do that?

 

Merlin8*

[coinsbygary]

My rational was just to keep this as generic as possible and only focus on the grade.

Gary

[JAA]

Unfortunately it is not that uncommon to find certified coins that are either overgraded or undergraded. My theory is that the problem stems from the pressure on TPG services to grade large volumes of coins as rapidly as possible in order to maximize profits. It is my understanding that each coin is only examined by the primary grader for twenty seconds. When coins pass through the grading assembly line that rapidly mistakes are bound to happen.

 

A case in point. Heritage Auctions is currently offering a 1936-M Murphy-Quezon Peso that is certified by NGC as MS66. I currently own a very nice MS65 example of this coin but have been hoping to upgrade to a MS66. When I checked out the picture of the MS66 specimen on the Heritage Web site I was very disappointed in what I saw. Both the obverse and reverse had noticable gouges that would be readily apparent without any magnification. Thats certainly not what I would expect in a MS66 specimen. The attached picture shows the reverse of this specimen. Note the two gouges in the field to the right of the eagle's wing. Needless to say I am not biding on this overgraded coin.

 

http://coins.ha.com/common/view_image_only.php?width=2100&height=2995&img=http%3A%2F%2Fimages.ha.com%2Flf%3Fset%3Dpath%255B8%252F9%252F5%252F1%252F8951323%255D%26call%3Durl%255Bfile%253Aproduct.chain%255D&alt=Philippines%+Philippines%3A+Commonwealth+Peso+1936-M%...+Image+%232

[brg5658]

Have you ever played the game of "Life"? Sometimes I get the feeling that the grading of bullion issue coins (Britannias, Maple Leaves, ASEs, etc) is a game of chance. Spin a little wheel to see what the label will say...

 

[Yankeejose]

Gary- I would guess a lot of us have at a least a few coins that do not appear to measure up to the grade on the holder. The points you mention a very good, valid reasons for why this happens. I hear the phrase "buy the coin not the holder" mentioned quite often. Obviously this should be the basic concept of any coin collectors thought process when they decide how much to pay for a coin and what is its true value. How anyone ever thought that is somewhat ironic that we should not automatically trust the grade on a holder, yet we send our coins to be graded by that very same service?