Technical v. Market Grading

No!

 

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To me It sure seems like the tpgs standards have loosened , but I'm not sure if it's just my perception of seeing more coins that are not graded to the tpgs own standards or what. Whether this is from a turnover of graders or just the same graders grading differently on various days or a gradual loosening of standards . Plus I'm not sure you can use different aged slabs and judge how tight the grading used to be to how they are graded now . Most of those OGL slabs and early NGC slabs have already had the best coins sent back for regrades and the ones that remain of those old slabs are the low for the grade coins . we can only go by what as I see are too many wrongly graded coins now .

 

Technical grading = using a technical standard, generally written, to come to the grade of a coin.

Market grading = using a more subjective standard to come to the relative rank of a coin based on a predicted market perception of a coin. By ranking coins, they (i.e. TPGs) are essentially pricing them.

There was a time, before the usage of the term market grading, when technical grading WAS market grading. That is no longer the case, as they have diverged. Some might call that divergence gradeflation, others might call it following the market. Using the article posted by Owle (bold emphasis my own):

"As for the coins you think are overgraded, I think that charge applies mostly to generic coins. Unfortunately I’ve seen a lot of overgraded coins from other grading services. You also have to consider our industry’s marketers, for example the ones who complain that MS 65 Saints are liberally graded. Part of that perception may concern flashy 1923-D and 1927 Saints. The market was telling us that it’s okay to have a few more marks on these flashy coins because they qualify to be market-acceptable. Viewed technically, you may be critical of the marks but the flash carries the grade. So, is this gradeflation or a reaction to the market that causes us to adjust?"

All of the above IMO, and, G, you are not the ultimate arbiter of truth. Your opinion is no more or less "the truth" than anyone else's. Perception is reality, and your opinion is just that.

Respectfully....Mike

 

They are posted in chronological order:

1) NGC 5 (1992-1995)



2) NGC 6 (1996)



3) NGC 7 (1997-2000)



4) NGC 7 (1997-2000)



5) NGC 9 (2001-2003)



6) NGC 17 (2004-2008)



7) NGC 17 (2004-2008)



8) NGC 17 (2004-2008)




Based on your statement in the original post

we should be able to see an obvious difference of either 1-2 grades of coins graded recently compared to those graded back in the 90's. I don't see it and neither do you based on the grades that you assigned.

 

So you are saying that there is no evidence by examining the coins, yet it exists. Some would call that drinking the kool-aid.

Yes, you can. We have had this debate many times before and I refuse to have it again. Gradeflation is the result of the inherent subjectivity of the grading process in combination with the greed an opportunism of those willing to exploit that subjectivity. It is not the result of a deliberate change (loosening) of grading standards.

What article did you read? The explanation for why coins were undergraded in the early years was because they were pricing coins.

In essence, he is stating that the apparent inconsistencies of early graded coins is due to mistakes made during the infancy of the TPG's, specifically value grading. Your claim is that there is a change in grading standards suggesting that coins were once properly graded and are now being overgraded. The truth is that there has been an evolution and maturation of the grading process and those early graded coins were improperly undergraded and now we have reached the point where coins are graded properly.

 

To use your words, "It's a forest and trees thing."

In plain english, he was explaining a specific adjustment made by the TPG's that affects a very small portion of the coin population. I have listed a few of these adjustments in post #5 of this thread. The ones I listed were:

1) Allowing for roll friction and grading a coin with high point wear MS
2) Value grading for rainbow toned coins.

All he did in his statement was point out another small adjustment.

3) Grade bump for a coin with superior luster.

So instead of focusing so intently on his one example, why don't you try seeing the forest for the trees.

 

Those are "facts" that you have chosen to support your position, and they are not in conflict with my own definition of the terms. We are both picking and choosing those parts that support our position -- we are each defining the terms how we see as best -- and you are no different than I in that regard.

That's why I used the word "essentially". Please take a look at the (modified) definition I proposed above and repeated here:

"Market grading = using a more subjective standard to come to the relative rank of a coin based on a predicted market perception of a coin. By ranking coins, they (i.e. TPGs) are essentially pricing them."

In your world, where you get to define terms or choose who you look to as an authority, that may be true. In my world, things are different. Who's right? Both of us!

The point I was trying to make is that technical grading was the way the market graded coins before market grading was a term.

As an aside, EAC grading, a type of market grading I would argue, was used far before 1986.

Did I ever suggest grading standards haven't changed? I don't think so.

In a way you have. On multiple occasions you've presented things as "the truth" and argued anyone who disagrees is incorrect. You've chosen parts of the article as evidence that support you're opinion as "the truth", when it is really only your opinion. I have done the same (although I try hard to not portray my opinion as truth). In the end, each of our perceptions (e.g. opinions) are reality, and, with all due respect, you do not get to decide whose opinions are "the truth" and whose are not. Perception is reality, and each of our perception is different. It's part of the human condition, and, IMO, you would be wise to consider that before suggesting your view is "the truth" and everyone who disagrees is wrong.

Again, have I suggested that standards don't change? I cannot recall those arguments coming out of my mouth or fingers -- and I certainly haven't espoused that position in this this thread -- but then again, I've posted a lot over the years and my memory is hardly perfect.

Respectfully...Mike

 

Well, if he is going to admit that they deliberately undergraded coins in the early days of the TPG in order to value grade them, then NO, my statements are not contradictory. Their grading standard dictated the coin was an MS67 but they slapped an MS65 on the label in order to satisfy the current price guide. Once they evolved, they stopped value grading coins which necessitated the undergrading. But the whole time, the coin was an MS67 and there was no change in grading standard.

Did you completely miss my entire post? I am going to provide two different quotes from Salzburg.

When he says "NGC doesn't price coins" he is speaking in present tense. When he says "We were grading based on value as well" he is speaking in past tense. It means that NGC used to value grade coins but they don't anymore.

 

I do not disagree with that, outside I might argue the "greatly" part. To the contrary, I would argue that market grading as practiced by the TPGs, does change over time, as the market changes.

And thank you for the acknowledgement.

In hopes of not going too far into a philosophy tangent, I agree, there is only one truth. However, I would argue that for humans there is no truth outside perception. Humans cannot experience "truth", but only their perception thereof. Now, we may argue, as in this thread, whose perception is closer to the real truth, but we'll never really know.

By way of example... For millenia, the Earth was thought to be flat. It was the "truth" of the time. Eventually, we figured out it was round. "The truth" was refined, and the world being round is now the generally accepted "truth". Did the truth change, or did our perception of the truth change? Will we figure out, in a future time, that the Earth is really defined in four dimensions rather than three or two? Who knows, but each of us will be convinced by our perception that we were each espousing the "truth". Perception is reality. There is no truth outside perception for we as humans are bound by it. As they said in the Matrix, a wonderfully interesting movie that goes into this aspect of perception and reality, "There is no spoon".

There is no right. There is no wrong. For humans, it's all opinion formed through perception, and refined through time with experience. The truth is out there, but we as humans will never know it, even though we often are convinced we do.

Sorry for the tangent.

 

Yes, they have! I have listed 3 different ways the have changed in post #28 of this thread and I am sure there are others. But the changes that have taken place are not tantamount to a "deliberate loosening of grading standards".

 

I think you two are essentially saying the same thing. Paul is arguing market grading allows for change. G is arguing market grading has changed. I think you are both right in your own way.

 

Mike,

I don't dispute that there have been changes made with respect to grading by the TPG's. My problem is when people claim that the TPG's simply loosened their standards in order to increase submissions.

 

Intent is always difficult to ascribe, whether we're talking about AT/NT or gradeflation.

G, is it possible that the market changed and the TPGs went along with them, and this is what has caused what you describe as loosening -- or are you arguing that they simply diverged from the market and loosened their standards (for a yet to be defined reason)?

Getting past that, and presuming for a moment that you're correct that they intentionally loosened their standards, what reason would you propose was behind their intent?

Just curious...Mike