What is the current state of grade-flation?

[numisport]

I believe it's a mistake to assume that ASE's or other coins which obtain wild color in a short period of time, are necessarily AT. Differences in coin types, their holders, methods of storage, and environmental conditions can lead to vastly different results.

 

In answer to the question posed at the beginning of this thread, the current state(s( of grade-flation are California and Florida. And based on many thousands of certified coins I've examined the past few years, as well as population report data and price histories, I believe that grade-flation is rampant. And that it's had a severe negative impact on values.

 

How do we fix it? CAC seems to have acquiesced in it in my opinion. I have been bothered by several CACed pieces I have seen lately, including several with prominent scratches or other defects that I found to be distracting.

 

I think CACs only goal it to build a market on coins they would buy and sell. That is pretty clear after all the threads we have had on this. Especially for non-MS coins, they are mostly looking at whether there has been human assistance on the coin and how severe, so yes they do let coins with scratches pass because they would buy and sell them. So I don't know whether they contribute to grade-flation, they just decide if they like the coin at the grade it has on the slab.

 

Recent example, I had a 1829 dime that got a cracked NGC slab during shipping, it was a VF25 and green beaned. Because vendor nicely gave me $30 back for the broken slab I decided to cross it to PCGS. It got VF20. Went back to CAC for consideration, went green bean again, not gold. So all that says is yes they would buy it and sell it for grade on its slab and this is an example of deflation. If they were consistent and focused solely on the grade, one would have expected a gold bean I think(?). So I don't think they directly contributing to grade-flation, that is all on NGC and PCGS.

 

Best, HT

This may not be gradeflation. It is likely the same old PCGS manipulation of NGC crossover. They are known to purposely downgrade NGC material just to support their own coins' marketability. Go ahead and laugh. My question is why did you allow them to remove that coin from its holder when NGC would likely reholder and CAC would then re-bean at no charge.

[numisport]

The problem is we are at the very mature stage of the product life cycle for grading and authentication services for the so-called "classic coins." A great many of the existing, worthwhile "old" U.S. coins have been graded, sometimes multiple times.

 

The only things the grading services can do are:

 

• Expand the hype for new modern coins,

• Offer fancy labels and better slabs

• Technology changes, like the PCGS "snifter"

• Make it easier to get higher grades for the coins that already in holders.

 

This last one is troubling, and it does not have that much to do with training the graders. I think that it is a change in grading policy from the top down.

 

 

 

Yup, Bill, that’s the long and short of it. One way to help address bullet 4 of your post would be to have an industry organization perform the job of CAC. I support CAC, but they are a for-profit business and one of their goals is “making markets in most actively traded coins.” A non-profit, truly independent organization free of “conflicts of interest” could sticker coins without bias according to a publicly available grading standard published on their website.

I could see independent not-for-profit verification services actually negating 3rd party grades because marketability would be reduced. CAC can offer to buy beaned coins thereby extending marketability for these coins. How about holdered coins with no grade - just a company stamp and a really well sealed slab. Gradeflation gone. Except no registry, no price guides and no assessment of what the finer known coins would look like. WELL THATS NO FUN !

[Hard Times]

 

I think CACs only goal it to build a market on coins they would buy and sell. That is pretty clear after all the threads we have had on this. Especially for non-MS coins, they are mostly looking at whether there has been human assistance on the coin and how severe, so yes they do let coins with scratches pass because they would buy and sell them. So I don't know whether they contribute to grade-flation, they just decide if they like the coin at the grade it has on the slab.

 

Recent example, I had a 1829 dime that got a cracked NGC slab during shipping, it was a VF25 and green beaned. Because vendor nicely gave me $30 back for the broken slab I decided to cross it to PCGS. It got VF20. Went back to CAC for consideration, went green bean again, not gold. So all that says is yes they would buy it and sell it for grade on its slab and this is an example of deflation. If they were consistent and focused solely on the grade, one would have expected a gold bean I think(?). So I don't think they directly contributing to grade-flation, that is all on NGC and PCGS.

 

Best, HT

This may not be gradeflation. It is likely the same old PCGS manipulation of NGC crossover. They are known to purposely downgrade NGC material just to support their own coins' marketability. Go ahead and laugh. My question is why did you allow them to remove that coin from its holder when NGC would likely reholder and CAC would then re-bean at no charge.

 

Since you asked, I had 3 NGC crossovers to PCGS in the submission. First was because the NGC slab had a big ole scratch on the front right through where the coin is and it is my experience NGC slabs don't clean up well as I have said earlier so I crossed it to PCGS knowing it would keep its grade (it did), putting it in a holder I could polish up if needed so that it never has to see another holder as long as I own it. It beaned in both holders and no question it would. Only question was whether it would upgrade at PCGS. Second one was because it was a coin that CAC did not pass and I strongly disagreed with. So crossed it to get it into a new holder and send to CAC again. Got the same grade as NGC, and in the PCGS holder, it beaned The third one was the 1829 dime with the cracked slab, was there to protect the other two - I knew they had to in principle downgrade something and this was the likely one since it would hardly affect value. And then I would have another coin to test CAC with to see if it would gold bean. It did not. So did this to test TPG's and CAC.

 

Frankly, for alot of my old worn coins, I don't care about the grade. But I do care about what CAC thinks because they don't like human assisted surfaces so they are a good test as they know alot more about all of the manipulations that have gone on than I have. Great education submitting to them. My experience is that PCGS is much more liberal than NGC in tolerating human assistance to surfaces. That may be contributing to grade-flation as coins that should be in details holders are getting a grade ATS sometimes.

 

Best, HT

[jom]

If they were consistent and focused solely on the grade, one would have expected a gold bean I think(?).

 

I'm fairly certain JA would not gold bean such an item. I'd guess if the coin were actually an XF and it graded VF20 only THEN would I expect a gold bean. His comment to me one time was something on the order of "gold beans are for 'no brainer' upgrades" something you don't see much in lower circ grades I think.

 

jom

[leeg]

So far as pricing goes, I don't think that there is much difference between VF-20 and VF-25 for an 1829 dime. A gold bean would indicate that it might qualify as an EF-40, at least that's my take on gold beans.

 

Bill the gold stickered coins I've seen are priced at least at the next grade level, very few bargains to be had.