"Problem" coins, what are they worth?

A 'problem' coin that is not especially uncommon or rare, is the one that you pay $10 for, and when you can't find a bigger sucker when it's time to sell, you sell it for .50 cents. I too am of the school of thought that there is no price too cheap for a problem coin, except for specific circumstances involving population/rarity.

 

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Here's one of those circumstances. This is a good example:

http://coins.ha.com/common/view_item.php?Sale_No=1128&Lot_No=2333#

This was an 1839-O $2.5 Classic Head quarter eagle graded by NGC as Improperly cleaned with AU details. This sold back in July. I thought this might be my chance to get a really nice one at a fraction of the cost.

I was wrong.

I guessed it would maybe go for around $600 (wishful thinking). You have to log in to see the sale price so I will just tell you it sold for $1,840. I was way off! With a mintage of only 17,781 and not many known, these don't come up for sale very often in any condition.

Had it not been improperly cleaned, it may have sold for 3 to 4,000. So it was still a fraction of what it could have been, but still well out of my price range.

 

If this is really the case, I believe one can only count on the melt value, the rest is just speculative.

What I don't understand is why would a person "slab" a coin for $100.00 if it's not going to help the person buying/selling or evaluating it have an idea of the coins value.

I find it a bit disconcerting that the coin experts, recognized coin grading folks, can't put a plus or minus value on these type of coins.

That being said, is it better to buy a raw coin or a slabbed "problem" coin. Is it obvious when someone is looking at a raw problem coin?

PG

 

Just from some of the pictures I've seen of "scratched" coins, I was a bit surprised they were labeled as problem. That being the case, is it uncommon for circulated coins to be gradeable?

Mike

 

I deal daily with seasoned citizens who are intimately concerned with the values of their collections. Based upon my experience I would guess that your opinion is in the minority of those over 60, though my evidence is only anecdotal.

That said, even those collectors i know who have no interest in selling their collections themselves usually understand that at some point their coins will be sold to new owners (most of them don't plan on taking the coins with them). So they try to make prudent decisions when purchasing their coins if not for their own benefit then for the benefit of their heirs.

 

you ask important questions!!

not quite. there are valuable problem coins, but they are difficult to sell and of all coins in a dealer's inventory they are the ones likely to sit around the longest, so his offer will be low because he has factored in the time value of his capital tied up in a difficult to sell coin.

This story is out of date. PCGS originally intended to only call rarities "genuine" but is was so well received that they have decided to charge a more standard fee for the service. It costs about the same as grading any other coin with them now.

We can, but we understand the lost use of our capital while stocking a problem coin and the prices we pay are much lower than most people would expect because of the hassle and the length of time required when selling a bad coin.

That depends on how good you are at spotting problems. if you are as good as the pros then by all means buy them raw, but if you aren't then be aware that you will (note I didn't say might) buy problems you don't see and overpay for that bit of your numismatic education.

sometimes, but not always. Recognizing problems can only come from knowing what coins in certain conditions are supposed to look like and also knowing what each of the different problems looks like. It takes years of study to get good at this and that is why most US coin collectors stick to ceritfied coins, it is just safer to buy a certified problem free coin (though that isn't completely foolproof either).

 

Thanks for this insight, what you say makes good sense. One last question related to these "problem" coins. What do graders or traders do about the really old coins which predate the whole concept of maintaining mint coins ect... Things such as gold doubloons?

Mike

 

This is one of the few exceptions where a problem coin is something I would seriously consider. When the coin is so rare that any example is desirable...a problem example is OK IMHO.

 

my avatar is a problem coin. What would you all think of a 1937-D 3 leg in XF-45 with a scratch (likely from a staple) about 1 cm long in the bison's back? Would you like a coin like that? I did and although it may be a problem coin of sorts, it's still an excellently detailed 3-leg.

I don't think that it's good enough to get bid, but it's not bad enough to have to discount it much more than 1 grade.

Opinions?

 

I love this response and agree with all aspects!!

 

Can you post a bigger photo Mike?

 

Here's my problem coin. Not worthless, JUST WORTHLESS than it could be. There is a place for such coins. I own a handlful of problem coins. I wish they were not so, naturally. I have divided thoughts on this subject. I like Carl's point about trying to restore such coins to as much of a normal look as possible. There is a lot of skill involved in this and it is very satisfying

 

here's one... forgive the pinkish lighting. Look at the scratch on the bison's back between the front and hind legs

 

I think you've hit it on the head here. But what does "so rare" mean?

I only have and probably will only have $20 or so a month for coins. But like any kid in the toy shop, I see the really cool toys. Should I buy that Lionel train set even though two of the cars are damaged? If I wait for a "problem free" set, it'll never happen.

For all the rich guys and gals out there, remember some of us want to do more than "you can look, but you can't touch". When giving advice, always consider the source and all we can do here is look at a bunch of pixels and consider screen names like brocolli_buns to determine that!

 

I haven't looked at many examples of the coin. Just be sight, I'd say it looks like a nice example. If I were to be critical, I'd say the edge has a bit of damage at the 2 to 3 o'clock position. Maybe a striking error or someone put it in a vice.

PG

 

Your coin is exactly what I was indicating by I would really purchase that coin. Such minor, trivial problems are of no real concern for many, many collectors. Note I say collectors. If you are a person that buys/sells or are really worried about tomorrow's values, then a coin like that becomes a maybe. If you are just a collector of coins, then it's a thing of desire. I would buy it, put it in an album, appreciate the no longer empty slot, show it off to others and never worry about tomorrow's prices.
I have several old cars. Many people always pop up with how much is that worth. I always say, I have no idea and really don't care about the value. They are fun to drive, so who cares about prices, I don't have any idea.

 

All I could say about that coin is I'd sure like to have it regardless of what may or may not be the problem. Really nice coin.

 

Personally I think if you collect any series pre-1900 you are going to have a cleaned coin - even if you stick to graded coins. To it is the degree of cleaning which should be considered when purchasing a coin. And I agree with others - some people will never complete collections without problem coins of some sort. I also think if you are truly worried about future values you should buy or invest somewhere else. I would like to think my heirs will recoup most of the value of the coins I have purchased - but if they don't then they don't. If they walk into a dealer and say sold - then yes they will lose money. If they sell them thru auctions then they might recoup more - but anything they recoup is more than they had. Just enjoy the hobby and understand the risks.

PS - Yes I do have problems coins in my collection. So far none of them are bad enough to make me get rid of them.