The “New” Greysheet – Significant Contradiction?

Since some (many?) in here use the greysheet as one pricing guide I believe the follow is important.

BACKGROUND: I have a monthly (not weekly) subscription to the Coin Dealer newsletter (CDN or greysheet) only so I may have missed some policy/governing statements from the new ownership.

Therefore my concerns/confusion is solely based on the October 9, 2015, edition.

PERCEIVED CONTRADICTION: On the front page of the October 9, 2015, (Vol. LIII No. 40), print edition, there was a very short item as follows:


“Price Correction on 1921-S Morgan Dollar
We have corrected the MS66 Bid/Ask for the 1921-S Morgan to reflect the current CAC bid.”

Among my first thoughts were:
-- are ALL CDN Bid/Ask values for ALL listed coins based on transactions involving CAC-stickered coins?
-- what are the Bid/Ask values for non-CAC coins?
-- I’m sure that they greatly outnumber CAC coins.

So I looked at the fine print at the bottom of the front page to see what general policies were in effect.

Here’s the whole paragraph even if some parts do not appear to pertain to my current concern; I don’t want to quote things out of context:

“The weekly COIN DEALER newsletter (AKA Greysheet) reports the national wholesale coin market monitoring dealer-to-dealer transactions, auctions and trade-show activity, online trading networks like CoinPlex (www.coinplex.com) and CoinNet, subscriber feedback and other anecdotal market observances.

The coins may be certified or raw (uncertified), but the grading MUST ADHERE to the current leading standard. Prices reported are derived based on the expertise of the editors of this publication. While prices indicated here represent coins at the higher end of the quality spectrum for the grade, PQ, CAC and plus graded coins will trade for a premium to CDN Bid values.[emphasis added] CDN prices are intended as an indicator only and we do not represent that it is possible to buy or sell coins at the published levels.”

As I see it there is a contradiction between the “Price Correction on 1921-S Morgan Dollar” paragraph and the emphasized portion of the policy statement.

Why should the 1921-S Morgan’s value be adjusted “to reflect the current CAC bid.” when the policy indicates those values DO NOT include such coins?

I’ve got other concerns about the CDN policies as laid out in the quote but I suggest sticking to the CAC/non-CAC Bid values for a start.

 

Log in or Sign up to hide this ad.

P.S. I have NOT gone to CDN with this -- yet.
I'd like input from here first.

 

My understanding of greysheet prices is that they are more of a wholesale price. I've often heard that greysheet is used for dealer to dealer transactions. So if they are basing a price off "CAC bid" then that would seem to indicate market value and not so much wholesale. I think it's a good idea to contact CDN and request clarification.

 

I don't see a contradiction, according to the actual language of the "policy."

What I see is that CDN values (which, according to the policy, do NOT exclude PQ, CAC, and +-graded coins) will probably be lower than CAC because CDN includes raw and everything else.

They are just noting that CAC prices will "trade for a premium" (a.k.a. higher price) than CDN.

Right?

 

Here's the contradiction I see:
"While prices indicated here represent coins at the higher end of the quality spectrum for the grade, PQ, CAC and plus graded coins will trade for a premium to CDN Bid values."
If CAC will trade for a premium to CDN Bid values , what's the rationale for adjusting the 1921-S Morgan Bid value to reflect it's CAC status.
Someone not knowing that was done will think the Bid value shown doesn't include a CAC premium and then value such a coin even higher, sort of a CAC-CAC.
The policy states that CAC coins will merit a higher value than the posted CDN Bid.

 

From GDJMSP:

I think the answer to your question is probably in this sentence -

Prices reported are derived based on the expertise of the editors of this publication.

In other words the editors of CDN decided that the value for that coin at this point in time should be what the current CAC bid is for that coin.

~~~~~~~~~~~~~~~~~~~~

I see that as a bit of catch-all waffling.
Sort of like a job description element like this, "Other duties as assigned."

 

Well, in this last quarterly, they explained that as the teletype system fell out of widespread use, these bid/ask values that the pricing was being based on were becoming more and more out of touch with the market as a whole, which seems very plausible.
I certainly noticed, during my short tenure in the business, that common date cartwheels in low grade were over-valued on the sheet, and heard lots of anecdotal evidence that many more thinly traded issues were quite undervalued.
I, for one, appreciate the changes taking place, regardless of what metric they are using to establish the changes.

 

I'm in total agreement with your assessment that the "Grey Sheet" will no longer be a composite documentation of market trading values, but a subjective reporting of a biased selection

Upon receiving the subscribed publication and the unrequested "newsletter" from the new owners, I personally believe their information is irrelevant to market norms of any trading segment, much less the total wholesale dealer trading values. The new system will probably be relevant as the diverse "values" published by the two top tier TPG. It's my understanding that only coins graded by these two TPG are being viewed/stamped by CAC. The values reported are considered ludicrous.

I recently purchased a scarce date/grade certified double eagle, acquired at a value ~25% below the assigning TPG published value, and ~10% above the other TPG suggested retail value. The ~35% "spread" between these two preeminent TPG published values were seemingly fantasy, and unrelated to actual market trends, approximately in the middle.

I personally will no longer subscribe to the CDN publications, and only use documented sales as a reference of average individual coin values. It appears that a relatively objective resource has joined the ranks of the "market value" grading assigners.

JMHO

 

To be fair, it is one coin in one (seldom traded?) grade. Perhaps the only recent sales observed were CAC-stickered. If that is the case, then I'd have to give them credit for noting this exception to the rule. I think it will take some time to see how the new ownership will shake out editorially, though I have to say I am reminded of the old adage about foxes and hen houses.

 

New ownership is trying to update the prices. The fact that there is a connection to a large online dealer will automatically raise red flags for some people. I will wait to pass judgement until they have had a chance to work out the bugs. From the company email I received they plan to revalue every coin. That is a large task to take on.

 

You know one I have noticed today at the coin show I visited as well as previous here in the state of Wisconsin is that how many dealers at those use Ebay over Greysheet and how many Greysheet is "out of date"

 

If you have fairly large quantity of CDN covered coins, it will most likely mean that by the time they finish upgrading the prices, you will worth much much more ( on paper )

 

I'm now going to ask CDN the same question.
If and when I get a response I'll post it in here.

 

Well Stated/Inquired! I believe objective involved Numismatists realize that current "bid" quotes probably/generally are nebulous numbers without a standardized basis for derivation.

If one received the 9/11/15 issue of "the COIN DEALER newsletter", they found the headline to be "NEW CHANGES IN STORE AT CDN".I believe the author proudly described his past 25 year efforts in evolving a single employee enterprise into a $30 million business, from which he was resigning "to report unbiased information".

The qualifying statement at the bottom of the 9/11/15 CDN cover page stated: "Prices reported derive from the highest legitimate Bids and lowest legitimate Asks seen nationally". Also stated: "Bids reported .... include consideration of certification costs".

The qualifying statement at the bottom of the 10/9/15 CDN cover page stated: "Prices reported are derived based on the expertise of the editors of this publication". The qualifying certification costs inclusion statement has been removed, while new seemingly nebulous statements have been inserted, including: "the prices indicated here represent coins at the higher end of the spectrum for the grade". What happened in the previous month to replace the "unbiased" reporting of the entire spectrum between "highest legitimate Bids and lowest legitimate Asks seen nationally"?

The 9/11/15 CDN document reported both BID and ASK prices for pre-1933 "U.S.GOLD". The 10/9/15 document ceased reporting ASK prices for MS65 and above grades, and I believe, while the reported price of GOLD had increased between the two publications, the stated BID for Pre-1933 GEM Gold coins had appreciably decreased.

I believe the commonly accepted definition of "NEWS" is: "a report of recent events". I wonder, if the CDN publication is "reporting" an opinion, something other than an objectively substantiated report from an independent source. The "report" may not be construed as "NEWS". I suggest that the CDN publication title might be changed from NEWSletter before a challenge (by current or potential subscribers?) may be initiated.

JMHO

 

CDN's response:

"Many people have written about this, and the answer is very straightforward. CAC is a company that also trades coins and posts bids on CoinPlex, and we are reporting the price that CAC as a company is bidding for the 1921-S dollar sight seen, regardless if the coin is stickered or not. This has nothing to do with the "CAC premium" of the coin. Dealers and individuals who are not members of CoinPlex are oftentimes not aware of these live bids. Thank you for your message. "

 

That reply makes sense. Thanks for posting it. The coin need not have a sticker. If it does I imagine their bid goes up.

A dealer I was working with was able to get me CAC bids when I was looking for a certain coin. I always wondered how he was able to get those. Now I see the bids were on CoinPlex.

 

Okay, I think I understand now.

CAC is treated as a single entity when it comes to bidding, same as you and I.

When a coin is for sale AND has a CAC sticker ("green bean") then it is treated as a premium item, hence the premium price.

So the Bid value listed in the greysheet is the normal value for a coin that's truly the grade in the column.
The Bid value for an XF coin is for an XF-40 coin for which there is no question that it's XF-40, not a "sort of" XF-40.
BUT
It is NOT good enough for a premium for the grade (not PQ, plus nor CAC).