What do you think? : Salzberg Advises: Research PCGS Populations and Prices

[Number200k]

Salzberg Advises: Research PCGS Populations and Prices

[toneddollars]

The numbers do not lie

[coinman_23885]

All this article will do is generate mass panic. NGC has its fair share of increased populations and decreasing auction values.

[jackson64]

Yes--populations should be kept low or intentionally mis-reported so that costs/values of coins can remain high !

 

One thing I'd like to see if actual pictures of the coins which are being alluded to as over graded.

 

It is very good for TPG's and the old guard of the coin industry if populations of top tier coins are kept low and subsequent prices remain high.

The meat and potatoes of a dealer's life in the industry is contingent upon the occasional POP 3 or 4 coin garnered during a submission worth tens of thousands. The auction houses make their money regardless off of the buyer and consignor.

[Nutmeg Coin]

It would take a team of experts with rigorous statistical methods to prove substantial changes in populations across all the major series, I look forward to a scientifically thorough paper that actually proves what he is asserting.

[bender9876]

I agree, I have thought NGC was always on top. Although for years prices were always alittle higher for PCGS coins. I collect graded Pandas, try to find them in PCGS slabs. There are some but like 10 to 1. Letting to many coins slip thru just for the money.

[MarkFeld]

It would take a team of experts with rigorous statistical methods to prove substantial changes in populations across all the major series, I look forward to a scientifically thorough paper that actually proves what he is asserting.

 

Sorry, but I think that is incorrect. I'm no such expert, and over the last few years I've noticed massive population increases (in terms of numbers and percentages) in a multitude of coin types and dates. And in many cases, the grading does not appear to be consistent with what it was a few years ago or longer. I'm by no means, the only one who feels this way.

[Zebo]

If this is an attempt to maintain a standard for grades and to keep as close as possible to that standard over time - I'm all for it. Grade inflation is hurting the collector and should be fought.

[physics-fan3.14]

I have many things I want to say right now.

 

I know that they may come across negatively (well, they are quite negative, but all towards Mark Salzberg and NGC).

 

I am not going to say these things right now. I will content myself with a few snarky comments.

 

Tomorrow I may be more reasonable.

[physics-fan3.14]

The numbers do not lie

 

The numbers always lie. There is an incredibly strong bias in that diatribe.

[physics-fan3.14]

NGC has its fair share of increased populations and decreasing auction values.

 

No. PCGS is incredibly loose and ruining the hobby. I read it in Mark's letter.

[toneddollars]

The numbers do not lie

 

The numbers always lie. There is an incredibly strong bias in that diatribe.

 

The numbers Mark used as examples do not!

[KMAG100]

All this article will do is generate mass panic. NGC has its fair share of increased populations and decreasing auction values.

 

I agree coinman, but it is good to see a TPG coming out and saying something. If he is saying it out loud about his competitor he is definitely looking at it internally IMO.

[physics-fan3.14]

The numbers do not lie

 

The numbers always lie. There is an incredibly strong bias in that diatribe.

 

The numbers Mark used as examples do not!

 

The numbers always lie. There is an incredibly strong bias in that diatribe.

[MJ]

Selective data points and extreme examples as Mark readily admitted always sensationalize. There are so many series where NGC high grade examples drawf those of PCGS. One could graph to their hearts content to prove a point. How much of the PCGS increased pops are from NGC crossovers? How many are from new rolls coming on to the market? Resubmiissions etc. Maybe PCGS is gravitating towards NGC's looser standards. I don't know the answers to these questions. I dont think Mark knows either.

 

Mark calling PCGS loose is the pot calling the kettle black. Is Mark upset that PCGS is almost as loose as NGC inow? Ever try to sell a non stickered non fattie high grade NGC Fedefal coin in the past 5 -7 years? First question is always why isn't this in a PCGS holder? Second question has this been to CAC? Offers always reflect a discount.

 

Desperate Hail Mary. Mark get your own house in order before casting stones. Or maybe that train has left the station. Build a better mousetrap. A better holder. Better optics. Better programs. Etc etc

 

Is there gladflation? Absolutely. Both services. Has PCGS standards loosened? Yes IMO. They still have some catching up to NGC In that regard. And people wonder why CAC stickered coins carry such a premium in certain series. Maybe time for a new service to emerge.

 

mark

[Number200k]

1. It should take matter for few days to compile the same statistics on NGC coins. The big hurdle is downloading data and formatting it for analysis.

 

2. Got to see at the same time how has NGC population grown/diminished for the coins in discussion.

 

3.one has to eliminate cross overs form the population numbers, not sure if there is an accurate way to do it.

 

4. On prices, has to remove outliers such as the $80k paid for the 1995-w PF 70. Auctions data close to that date is suggesting prices were around ~20k

 

5. Similarly on the bottom end of pices, have to remove outliers

 

6. Include/exclude compensations for CAC stickered price premiums etc

 

7. Got to get more average pricing information to even out and get trends.

 

8. Will add more points....

 

[Tyrock]

I started collecting in 1978. I started by sending coins in to ANACS. I still have old photo certs. Then PCGS and NGC came along. Now it's CAC. There have been problems every step the way. Over the years I've made an effort to educate myself to become an informed collector. I believe that Mr. Salzberg has made a very interesting point.

[mumu]

A good old fashioned TPG executive dance off may be under way. Could be fun.

[MJ]

A good old fashioned TPG executive dance off may be under way. Could be fun.

 

Good point. The entertainment value could be immense.

 

 

mark

[coinman_23885]

Nothing entertaining or good will come from this. I'm sure PCGS will do the same in kind to NGC. The reputation of both will be damaged. When you urinate in the pool, it washes back on you too. So many seem to forget that.

 

Rather than arguing about inconsistency of the other services, he should be promoting his product and starting an active campaign to buy back all of the coins graded in NGC's looser days (pre-Salzberg ownership). That would strengthen his brand and do wonders for NGC's marketing. PCGS should do the same. It would be a win for both companies and for collectors/the hobby.

[coinman_23885]

"I can say with confidence that I believe that the grading standards PCGS uses today are completely different from the standards it used 10, 20 or 30 years ago."

 

 

NGC doesn't use the same standards from yesteryear either and Salzberg even admitted as much in a 2011 interview with Maurice Rosen. He downplayed most of the alleged grade inflation as a "learning curve." In the same interview, he slammed what he described at various times as "irrational exuberance for plastic" because of the registry phenomenon (and presumably because of one brand loyalty) and criticized registry players for "drinking the Kool-Aid" while encouraging collectors to buy the coin and not the holder. What has changed? Contrary to the letter, I do not think that NGC's grading changes have always been made "glacially" either. To be frank, the grading services have had me terrified for some time about the long term stability of the market grading paradigm that both employ.

 

https://www.ngccoin.com/news/article/2259/

(Scroll down in the interview a bit.)

[physics-fan3.14]

1. It should take matter for few days to compile the same statistics on NGC coins. The big hurdle is downloading data and formatting it for analysis.

 

2. Got to see at the same time how has NGC population grown/diminished for the coins in discussion.

 

3.one has to eliminate cross overs form the population numbers, not sure if there is an accurate way to do it.

 

4. On prices, has to remove outliers such as the $80k paid for the 1995-w PF 70. Auctions data close to that date is suggesting prices were around ~20k

 

5. Similarly on the bottom end of pices, have to remove outliers

 

6. Include/exclude compensations for CAC stickered price premiums etc

 

7. Got to get more average pricing information to even out and get trends.

 

8. Will add more points....

 

Other points: Mark selected a few egregious examples to make his point. What happened, overall, with the rest of the PCGS populatoin? I'll bet there are a few egregious examples in the NGC data as well. How does the change in PCGS population compare to the change in NGC (factoring relative sizes of the companies)?

 

Mark's claim is that these "explosions in population" led to decreases in price. Well, what was the overall coin market doing? Did that have any effect on prices? We've had recent discussions that, overall, the coin market is slower than it was a few years ago.

 

Mark claims that prices for the PCGS coins went down. How did prices fare for similar NGC coins?

 

The point you make about outlier pricing is also very important.

 

 

[physics-fan3.14]

NGC has always focused on the positive in its marketing

 

Maybe you should stay that way, Chairman Salzberg. Instead of engaging in Trump-style hit-pieces and negative attack ads (rife with speculation and unsubstantiated rumor), and dragging NGC through the mud, focus on making the collecting experience better. Instead of ruining your own brand by alienating everyone who supports you, focusing on making NGC someplace we want to spend our money.

 

I do not know why these PCGS-certified coin populations have changed so dramatically in recent years

 

Exactly, Chairman Salzberg. You have offered one sensational theory, but I can think of at least three others, all equally plausible, to explain the increase in populations:

 

1. People are crossing NGC coins over to PCGS because PCGS is generally regarded as bringing stronger money.

2. People are certifying new coins in larger numbers, to enhance resale value or participate in the registry.

3. People are resubmitting coins in an attempt to get an upgrade.

 

[Mr.Mcknowitall]

It seems like a very reasonable article, to me. There are not any logic flaws, and the article cautions that what is desired....that the collector examine the numbers and the quality of any piece.... applies to all TPGs, including NGC.

 

Granted there are tidbits of marketing sprinkled here and there. That does not diminish the observation of a possible problem and suggestion of collector scrutiny. It does direct the reader to the proclaimed concern that the competitor has had perceived questionable events in the last 5 years, a lowering of standards and a questionable increase in population outside norms experienced in previous periods.The article does not eliminate the possibility of like issues @ NGC, and collectors observing and questioning NGC end products (in the last 5 years is implied) is encouraged.

 

The advice is sound: buy the coin not the holder and buy with knowledge not brand loyalty and buy reality not perception.

 

The references in comments concerning the 4PG are not germane. The 4PG did not encapsulate, and the 4PG is a business model that buys what it labels. It is a brilliant business model, because it is perceived as the SCOTUS of the hobby. But, it did not and does not originally encapsulate. Had the business model included encapsulation, I am certain there would be questions.

[Nutmeg Coin]

"The PCGS Population Report and auction prices realized are all public record, and the numbers do not lie. I encourage everyone to do their own research and see the facts for themselves before they buy any PCGS-certified coins—or any coin for that matter, including NGC-certified coins.

 

"As a collector myself, there are some questions I always ask before making any purchase:

Has the graded coin population changed in the last six months, year, two years or five years?

If it has, can the change be explained by the discovery of a hoard or an increase in submissions?

How has the price changed in the last six months, year, two year or five years?"

 

 

Are there any sites that chart population figures at NGC, PCGS as well as CAC year by year? If people have to do all their own research on increases, it becomes too high a hurdle for big collectors.

[Mr.Mcknowitall]

"The PCGS Population Report and auction prices realized are all public record, and the numbers do not lie. I encourage everyone to do their own research and see the facts for themselves before they buy any PCGS-certified coins—or any coin for that matter, including NGC-certified coins.

 

"As a collector myself, there are some questions I always ask before making any purchase:

Has the graded coin population changed in the last six months, year, two years or five years?

If it has, can the change be explained by the discovery of a hoard or an increase in submissions?

How has the price changed in the last six months, year, two year or five years?"

 

 

Are there any sites that chart population figures at NGC, PCGS as well as CAC year by year? If people have to do all their own research on increases, it becomes too high a hurdle for big collectors.

 

I am curious about your thought. How is it too difficult a hurdle? Granted, in the case of the 4PG, the entity does not publish, but has the info of what the entity has "SCOTUSed", and this is an advantage to the 4PG because they know what you don't, which is a part of the business model. But, it did not originally encapsulate or originally grade. The entity just opined on that which was. The TPGs do publish, do they not?

[Nutmeg Coin]

Mr. Salzberg provided graphs of populations and price changes, where are those from? Are they proprietary from paid research? I'm sure the top players in the business are doing the research on thousands of coins, how can we find the charts with any given coin?

 

Also what would be useful would be objective technical analysis on individual coins with images on why the coins are overgraded.

[Mr.Mcknowitall]

Mr. Salzberg provided graphs of populations and price changes, where are those from? Are they proprietary from paid research? I'm sure the top players in the business are doing the research on thousands of coins, how can we find the charts with any given coin?

 

Also what would be useful would be objective technical analysis on individual coins with images on why the coins are undergraded.

 

I suspect it is either self or entity produced, but certainly can be done by any collector (big or not), given the availability of previous and current published data. The larger auction entities also list this info, don't they? With the tools of technology that exist today, I think even I could make a simple graph chart with the info available. I know I can do it with paper and pencil (which I used to do a long time ago and even now do so occasionally), which would serve the same purpose.

[Mr.Mcknowitall]

I should also apologize for any impression that I have hijacked the Get The Chairman direction of the thread. That was not my purpose. It was not due to any loyalty thing, just a curiosity of why thing.

[James_OldeTowne]

I found the article useful and insightful, and close to the truth. As you all know, my personal collection relies very little upon slabbed coins, but as a business, I got burned, not once, but twice on the exact coin leading off the article - 1912-S Liberty nickel.

 

I happened to buy two of them in MS-65, with zero expectation whatsoever that the bottom would drop out of the market for what used to be a very elusive coin. In both cases, my company lost money.

 

A subtle effect of the sudden explosion of the population of a coin in a specific grade is that it has a depressing on the price of examples in lower grades, particularly the next lower grade.

 

If the price of MS-66 nickels suddenly drops 80%, then the MS-65s will also drop in value as some collectors won't "bother with" the MS-65s anymore ("but, MS-66s are so cheap now!")