For 25 Years NGC Makes The Right Call

Posted on 10/4/2012

Bust Type Face Relentless Demand; Indian Eagles A Great Value

With autumn upon us, most of the country has already felt that unmistakable nip in the air and is enjoying the majestic and vibrant change of color of the leaves on the trees which define the landscape. Here in Northern New England, it is a joy to behold. This new seasonal chapter has also traditionally ushered in what has been a decidedly more active time in the coin market.

This fall is no exception. With the US Presidential election only a month away, that fiercely contested race is at the forefront of all media attention. The recent tragedy and ever growing unrest and uncertainty in the Middle East has also heightened tensions worldwide. Coupled with unresolved economic issues in Spain and Greece, the perceived safe haven of gold, along with the other precious metals, have all propelled ahead. The yellow metal, enjoying increased interest worldwide, has responded with an over $200 bump up in the last 60 days. Silver has also powered significantly higher, claiming nearly a $7.50 an oz. advance in the same time period, equaling a 27% increase!

Although the world is wrought with turmoil, numismatics is certainly not oblivious to these trends. Many market pundits assert that as a result of the dominant display of precious metals, legions of bullion customers and budding numismatists have stepped into the market. While some are spurred on by the excitement and others anxious to preserve wealth, many established collectors are also anxious to buy bullion coins and bars as well as semi–numismatic related material before further escalation places them out of reach.

Interestingly, even as the price of gold escalates to levels not seen in nearly a year, premiums for Mint State Liberty and Indian Eagles in MS 64 have witnessed moderate declines. As an example, in February of this year with gold trading at virtually the same price as today, the “ask” on an electronic trading network was $1,985 for a $10 Indian graded NGC MS 64. As we go to press the dealer “ask” is $1,545. The $10 Liberty With Motto was trading for $1,750 in February and is currently being offered at $1,575.

While demand and price for these gold coins has remained stable in other Mint State grades, several market makers consider the current level of the $10 Indians to be an exceptional value. One well known East Coast dealer advised me that in general, MS 64 Eagles are at great price points. The dealer feels that the $10 Indians are especially a bargain at the present level. “I have many customers that really love the $10 Indian as a type coin and now they can buy two MS 64 examples at the price of an MS 65! These are still a far cry from the record bid for NGC MS 64 $10 Indians of $5,675 back in 1989!”

Generic or common date $20 Saint Gaudens in MS 63 to MS 65 have held strong and are trading at increased levels when compared to the same time period. However, with that said it is important to note that the difference between MS 63 and MS 64 examples is only $40! Stepping up to MS 65 there is only a $200 escalation to get a full gem representative for your collection! As the price of gold is nearing record territory again, the premiums for Mint State Saints above melt value in high end circulated or MS 60 has eroded even further giving collectors and investors a great entry point to this wonderful and heavily collected series.

With a few weeks until the ANA Show in Dallas, dealers have a chance to scour the Internet as well as regional shows to secure new inventory and prepare for the holiday rush. As always a few coins or series are in exceptionally strong demand. The ever desirable and scarce Capped Bust Quarters (both large and small diameter types) grading MS 64 and better are on several dealers’ must have lists. It is also worth reiterating that virtually all problem-free circulated Capped Bust type coins from Half Dimes through Dollars are receiving even higher bounties. As one well known dealer stated, “This stuff (Capped Bust type) is in incredible demand. We could desperately use multiples of all denominations in VG to AU ASAP”! Another dealer concurred adding that his customers are chasing Capped Bust Halves in the high rent district of MS 65 to MS 66. “These early Federal issues…are rarely encountered.” One of the more plentiful of the series in these targeted grades is the 1826 reporting in, according to the NGC Census, with only 56 MS 65 and 19 MS 66 coins respectively. The most plentiful date of the type is actually the 1834 Capped Bust Half Dollar with 72 MS 65 specimens and 21 at a point higher.

On September 26th NFL Commissioner Roger Goodell apologized to the football fans who agonized through three weeks of replacement officials calling their favorite teams' games. “You're always worried about the short–term impact on your brand and the long–term impact on the brand,” he said. “Obviously this has gotten a lot of attention and it hasn't been positive. It's something you have to fight through and get to the long term,” said Goodell.

As the league found out after the third week of the NFL season, there is no compromise for accuracy with their professionals officiating on the gridiron. The replacement refs were obviously not up to the task as evidenced by what transpired on the playing field.

As a result, the league, the fans and the consumers were short changed for three weeks as the integrity of the game was compromised. No matter what the sport or business everyone wants to see the right call made consistently. That is why an independent firm such as NGC is so important to the numismatic industry.

Prior to the mid–to–late 1980s, a standardized universally accepted grading terminology really didn’t exist in the coin business. There were, of course, numismatic professionals that painstakingly interpreted and employed grading scales based on Dr. Sheldon and other noted authorities. Although many others relied on hands–on experience in the trenches with their coin grading interpretations. Until the mid–20th century, in most instances a coin was either circulated (good or fine) or Mint State. If a coin were somewhere in between it wasn’t as much of a sticking point for collectors. Uncirculated and BU (Brilliant Uncirculated) were the most coveted grades when I began collecting in the 1960s. Then adjectives defining the grades entered the lexicon and words such as “Choice” and “Gem” were added to the mix. Most dealers were accepting with the change and attempted to be as accurate and consistent with the grades assigned to coins in their inventories.

There were, of course, inexperienced coin dealers entering the playing field and in significant numbers. Deciphering this grading thing became quite a task for the new dealers venturing in the arena as they quickly learned this is not an exact science but one that is highly subjective with variables for virtually every US series.

As the coin business expanded dramatically in scope and value, especially after the great market escalations in the early 1980s, it was obvious that to protect the integrity of the industry a standardized, impartial game plan for grading was a necessity. After all, in many instances just one grading point could be worth hundreds or even tens of thousands of dollars. Blowing a call could be catastrophic to dealer or collector.

Thankfully, for most of the hobby brethren today it is hard to remember a time when NGC, the official grading service of the ANA and the PNG, wasn’t there for us to call on. For the past 25 years and after grading over 25 million coins, NGC has been there to oversee the important calls in grading the world’s finest coins, standing tall in the industry; authenticating, grading and protecting the numismatic treasures for today’s collectors and dealers as well as future generations of numismatists. And on the rare occasion where an error in judgment has been made, NGC will even “reverse the call” with a guarantee on grade as well as authenticity. NGC, the industry leader of independent third–party grading not only set the standard but ushered in a wave of admiration and security for all of us.

Until next time, happy collecting!

Jim Bisognani has written extensively on US coin market trends and values and was the market analyst and writer for a major pricing guide for many years. He currently resides in Southern California and frequently attends major coin shows and auctions.

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