The Official CoinTalk Grading Experiment 4

I think we should leave the analogy that AU's are graded MS alone for now. That is another discussion that has its own unique argument: Is coin to coin contact that manifests itself as wear the same as wear from circulation? Or should it be graded like other coin to coin contact (eg bag marks) and still be considered uncirculated?

We both agree that if a coin has a patina that improves its eye appeal, then the VALUE of that coin should increase. Where our opinions diverge is whether eye appeal should be even considered in the grading process at all. If you eliminate eye appeal and focus solely on the surface preservation of the coin, you are advocating technical grading. If you consider the four elements (surface preservation, luster, eye appeal, strike) of grading in the grading process, then you are applying market grading.

This brings us to the crux of this very contentious issue. You consider the application of market grading, on its own, as an attempt to value the coin. I and many others who agree with market grading don't agree with that assessment at all. We consider the market grading process a holistic method of grading that accounts for all of the elements that affect the overall value of the coin. The result is that a coin that has MS64 surfaces with premium gem luster and eye appeal due to rainbow toning will receive a higher grade than a lackluster untoned coin with similar MS64 surfaces. We don't do this backwards by saying, the value is higher, therefore we must give it a higher grade. We simply look at the coin, and recognize that its luster and eye appeal make it a superior coin and it deserves a higher grade.

I have posted my opinion about the "eye appeal bump" many times on this forum, including earlier in this thread. I think in order to remove the subjectivity of eye appeal, the TPGs should use a formula that ranks the importance of each element of grading, then assign a numerical grade for each of the 4 elements of grading, and let the chips fall where they may. I refer back to the two Morgan Dollars that I posted earlier in this thread (shown below) and have also included the quote from me earlier in this thread that details how I think market grading should be applied mathematically.

So you see, I am not trying to value the coin either. I simply assign a numerical grade for each element of grading, insert my values into the weighted formula, and accept the result grade that is generated by that formula.

And as someone who has collected rainbow toned coins for decades, I can state unequivocally that bumping a rainbow toned coin up one grade more often than not does not correctly value the coin since many rainbow toned coins generate premiums of multiple times the price guide value whereas the grade bump does not. Trying to value grade a toned coin by bumping the grade up one grade is a fools errand, but assigning a higher grade on the basis that the coin is a superior coin compared to other coins of that grade is perfectly reasonable.

 

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Ah, I've been saying this for years. I'm a huge fan of my SLEC method (Strike, Luster, Eye Appeal, Contact Marks), and awarding each an individual score.

Realistically though, this is one reason why I like the Star. When used appropriately, you can accurately grade this coin without an excessive eye appeal bump in numerical grade but apply the star to designate a strong coin. The Star alone is often worth a pretty good value bump.

 

Say it ain't so... IM supposedly arrogant opinions, I need to start with this first paragraph.

Lehigh96, posted: "I think we should leave the analogy that AU's are graded MS alone for now. That is another discussion that has its own unique argument: **Is coin to coin contact that manifests itself as wear the same as wear from circulation? Or should it be graded like other coin to coin contact (eg bag marks) and still be considered uncirculated?**

First, IMHO, anyone who calls themselves a knowledgeable numismatist or gets out of one of my individual grading sessions had BETTER KNOW THE easily determined difference between "stacking rub contact" and friction wear (cabinet friction)! They look nothing alike. AU coins are NOT Mint State in spite of what happens in the commercial world. Furthermore, I think you should edit your post as BAG MARKS DO NOT take a coin out of the MS grade range - except again in some cases as done by uninformed rookies and sometimes in the commercial market to lower the value of a beat-up coin!

"We both agree that if a coin has a patina that improves its eye appeal, then the VALUE of that coin should increase. [100% in agreement! ] Where our opinions diverge is whether eye appeal should be even considered in the grading process at all. If you eliminate eye appeal and focus solely on the surface preservation of the coin, you are advocating technical grading. If you consider the four elements (surface preservation, luster, eye appeal, strike) of grading in the grading process, then you are applying market grading."

You told us your qualifications so here are mine so I can properly address the paragraph above:

Most do not know that I am the sole person (with the approval of Charles Hoskins) to devise the TRUE "Technical Grading system" used for our internal records at ANACS in DC (NOT in CO as they had no clue although they called their system "Technical.) So, in the "true" technical system the aim was to be able to ID a coin if seen again, lost, or stolen. In addition to its technical grade we had a weight and image. The ONLY consideration was the condition of preservation of the coin from the time it left the dies. Therefore, the only way to lower the grade of a MS coin was to add marks. A weakly struck coin with no marks was the same grade as a strongly struck coin. The COMMERCIAL VALUE of a coin was of no consideration. If a coin was toned or weakly struck, it was noted. If I took a perfect gem coin and put a hole through it near the rim at 12 OC it was a gem w/a hole. We described the coin as it existed. The technical standard was very strict. MS = no trace of wear. There was no AU one day and MS the next as exists now. Grading circulated coins was very close to as it has always been (before gradeflation0. Eye Appeal was not considered but unusual eye appeal was noted: Choic Unc (old MS-65), weak strike & splotchy toning. Unc (old MS-60), rainbow toning. Unc, excessive marks.

Technical grading of MS coins is DEAD - except - problem coins were graded exactly as they are now. Grade the coin state the problem. NO NET GRADING allowed. ANA grading standards were virtually DEAD from the beginning and their grading service had to change to the commercial standard that dealers evolved into what we have today.

That said, I teach technical grading first and then explain market grading which involves VALUE and a great deal of knowledge that must be learned outside of a class. I have not been a dealer for almost forty years. I am NOT QUALLIFIED to put a price on a coin with out looking at a Graysheet to get an idea. At work I am first on most boxes looking for the +/- issues of each coin. I have little idea of the value of the coins I grade and wish to keep it that way. I grade coins and let others value them!

I do know this from experience. I can teach anyone who is not color blind and can tie their shoelaces in one try to grade a Mint State/AU line coin using strict technical standards in a very short time. They will also know the difference between loss of surface from compression vs friction.

 

The debate between "technical grading" and "market grading" has raged for decades now. Old school collectors (generally, those who started before the mid-80's) often hold strong to the ideas of technical grading.... even if they may have diluted them a bit. The TPGs fully embrace market grading... and so most modern collectors also embrace market grading.

The benefits of each are complicated, and can be debated. But let's be clear - 99% of grading done today is market grading. If you're trying to guess the grade of a PCGS coin and you use technical grading, or EAC grading, or something like that.... you're just not even playing the same game.

 

Lehigh96, continued:

"This brings us to the crux of this very contentious issue. You consider the application of market grading, on its own, as an attempt to value the coin. I and many others who agree with market grading don't agree with that assessment at all. [Oh my. Whether you agree with it or not, the TPGS and every grading instructor or dealer I know will be happy to inform you and your friends that COINS ARE GRADED TO ESTABLISH THEIR VALUE.] We consider the market grading process a holistic method of grading that accounts for all of the elements that affect the overall value of the coin. The result is that a coin that has MS64 surfaces with premium gem luster and eye appeal due to rainbow toning will receive a higher grade than a lackluster untoned coin with similar MS64 surfaces. We don't do this backwards by saying, the value is higher, therefore we must give it a higher grade. We simply look at the coin, and recognize that its luster and eye appeal make it a superior coin and it deserves a higher grade. [LOL, there is no such thing as working backwards. it does not matter if the cart is before the horse or not. Knowledgeable folks will arrive at the same grade! That's why all four major TPGS grade virtually the same.]

"I have posted my opinion about the "eye appeal bump" many times on this forum, including earlier in this thread. I think in order to remove the subjectivity of eye appeal, the TPGs should use a formula that ranks the importance of each element of grading, then assign a numerical grade for each of the 4 elements of grading, and let the chips fall where they may. I refer back to the two Morgan Dollars that I posted earlier in this thread (shown below) and have also included the quote from me earlier in this thread that details how I think market grading should be applied mathematically."

I think your suggestion will eventually come about in the future. Something like 05408510.






"So you see, I am not trying to value the coin either. I simply assign a numerical grade for each element of grading, insert my values into the weighted formula, and accept the result grade that is generated by that formula.

And as someone who has collected rainbow toned coins for decades, I can state unequivocally that bumping a rainbow toned coin up one grade more often than not does not correctly value the coin since many rainbow toned coins generate premiums of multiple times the price guide value whereas the grade bump does not. Trying to value grade a toned coin by bumping the grade up one grade is a fools errand, but assigning a higher grade on the basis that the coin is a superior coin compared to other coins of that grade is perfectly reasonable."

IMO, it would be more reasonable, simple, PRECISE, and easer to understand if a star was used rather than grading a beautiful MS-65 rainbow Morgan MS-66.

 

If a TPGS add a + for exceptional eye appeal for the grade, why not put a - on the ones that have poor eye appeal for the grade ???

Can you make this happen insider???

 

Very well put. The ONLY thing close to technical grading being done today is with "detailed" coins.

 

LOL, I have no influence over anything except when I leave work at night. I don't even get to pick what I'm going to eat tonight when I get home.

 

This, I think, is something that we can all agree on.

I also think you underestimate your influence... if you started advocating for something like this (trademarks notwithstanding, of course), I feel like the company you work for might be inclined to listen.

 

The thing you are not listening to is that the technical grade gives the coin the merit. Surface preservation is one thing, But looking past the virtually untoned coin with some kind of atoms and molecular surface conditions because of the wash the mint gave them is a bit too far into my understanding of the minting process.

We all understand what beauty is, and another thing we get is when a coin is graded correctly because of it's merits, not because of the state of preservation after it was used.

AU=AU and MS= Gem and BU

Trying to eliminate technical grading is in my opinion going out of style.

I also noticed @Insider "s intent to make sure we were looking at the initial contact as a whole. Grading a coin IMO involves what is initial contact and what is consecutive contact. Consecutive contact is "WEAR" period.

Value is usually tied totrial and error. A teacher's constructive criticism can only go so far, before it is time to let the student learn for themselves.

Call me the newbie then, I have been at it since the last recession 08' there isn't a day in my life that I thank more since, than to learn Technical grading. Not only that but to learn die states and it application to Grade.

 

You got it easy,

 

When you grade a coin on surface preservation, luster, and strike, eye appeal naturally falls out. A coin with few marks, good strike and great luster will have exceptional eye appeal, toned or not. That coin will get a high grade. When you have many bagmarks, the eye appeal goes down, and so does the grade. I’m not advocating for ignoring eye appeal altogether. I’m advocating for not treating it as a separate grading category. Eye appeal is a requisite for a given grade level, not an excuse to bump up to the next one. If you have a designation for exceptional eye appeal (star, etc.), then use it! A grade bump is not necessary.

Take a nicely-toned technical MS-65 and bump it to a 66. The market will see it as a nicely-toned 66 and attach a premium on top of the 66 grade. Of course it will sell for much more than a single grade bump, and even more still over the technical grade. This is a side-effect of double dipping. The nicely-toned 65 will still sell for much more than a generic 65, even when graded as such.

 

A + is not the same thing as a *. A + is an in-between grade. For example, an MS-65+ is equivalent to an MS-65.5.

 

Pickin and Grinin, posted:

I also noticed @Insider "s intent to make sure we were looking at the initial contact as a whole. Grading a coin IMO involves what is initial contact and what is consecutive contact. Consecutive contact is "WEAR" period.

Suggestion: "Contact" is a word that is normally not associated with friction wear EVEN THOUGH something must come into "contact" with a coin to produce friction wear. "Contact" as in "contact marks" is more often associated to marks on a coin (bag marks) that are not specific such as a scratch, gouge, etc.

 

This is another thing the "Ex-PERTS" who ruined a really precise system (True technical grading) screwed up. First, ignore stupid "net grading."

Now, consider any grade, say XF. Coins fit into that grade due to the amount of their original design (as struck) that remains. Dealers used a plus (+) as you did to designate a coin in the upper half of a grade. For our system, a + was reserved for the top 2-3 % of a grade - the liners. Because of this, there was virtually no argument about when a coin rated a + and what it looked like to help ID the coin.

 

That doesn't account for differences in eye appeal from the general appearance and effect of an equivalent level of marks between matte and PL/semi-PL surfaces.

 

Do the TPGs take off a point for marks on PLs coins? As in a normal 63 with PL surfaces would grade a 62?

I would think the flashiness of the fields would have a sufficient eye appeal to maintain the grade

 

Yes, coins are graded, and the assigned grade is then tied to a value that can change over time while the assigned grade does not. This is not the same as trying to value a coin, grading is simply a means by which you can place value on a coin. In other words, they do exactly what you do, they assign a grade based on the standards of market grading, and then the market decides the value.

Don't look now, you just proved my point.

The star designation is proprietary, what would you like PCGS to do, create another symbol to match NGC's star? If you think that marketing gimmicks are the solution, then okay, but I would rather they include eye appeal in the grading process and if the eye appeal is enough to warrant a higher grade, then so be it.

 

No, I dissent, and have been for the last several pages.

 

I am listening, you and your friends think the only aspect of grading that deserves merit is surface preservation. I disagree and think that luster and eye appeal are very important factors, and strike can be a significant factor on some coins as well.

This has nothing to do with oxide layers that are invisible to the naked eye, I merely mentioned that as a rebuttal to the fact that Typecoin called rainbow toned coins damaged. Outside that narrow application, you don't need to worry about surface chemistry.

I have no idea what you were trying to convey in the sentences highlighted in red. Honestly, I read this post last night and though you had too many beers.

Yes, eliminating technical grading is going out of style, because it is already dead. The TPGs killed technical grading and you guys who can't accept it are now basically a fringe group.