Coin Grading Standards by TPG

It is very difficult to authenticate coins, and even experienced dealers and collectors make mistakes. Authentication is the major benefit for all.

 

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I didn't know that. Where does one get the required training to be an authenticator or grader? Is there a TPG sponsored seminar or something similar?

I've always considered myself to be very (self taught) knowledgable about the coins I own and collect yet I've never been to a coin-show or sold a coin in my life.

I also try not to get caught up in the oneupmanship which taints a lot coin discussion on internet groups/lists. The "How dare you question my authority/I'm the expert here" mentality really quashes a lot of good numismatic discussion and dialoge.

Ben

 

Ben,

Yes, it takes a lot of experience and knowledge to authenticate coins and even grade coins correctly! Heck, there was recently an article in Coin World about a big Coin Shindig in China where the U.S. Coin Dealers found hundreds of counterfeited (I think they were Peace Dollars) coins mixed in with thousands of authentic coins. Out of the many Coin Dealers that purchased some of these, only one picked up on the fact that quite a few of the coins were counterfeit and real good counterfeits at that! After getting the word and what to look for, the other Coin Dealers weeded out the counterfeits that they were sold and took most of them back for a refund but kept a few for comparison in the futuire and for research. There are some seminars on grading and authentication taught across the Country but they may be hard to locate and to attend. There are many books on both that can be purchased through Book Stores, Book websites, eBay and through some Coin Dealers and a person can become self taught but all of the books in the world can not replace the experience of studying counterfeit and real coins in hand. Many Coin Dealers at Coin Shows will have counterfeited coins to look at and even for sell. I have purchased quite a few counterfeit coins and have learned from my mistakes in the past and I have seen, held and studied hundreds more since then and learned what to look for.

A Coin Show can be one of the best resources of information and to gain knowledge about coins and you don't have to purchase or sell coins to attend! Visit as many of the Coin Dealers as possible, check out their' various assortment of coins, ask questions and try to make it to one or more of the booths that the Coin Grading Service Companies have at the Coin Show. Take some of your nicer coins and any coins in question and have the Representative check them out, give you a verbal grade and ask them lots of questions about the coins in question. If you can, hang around to see what others bring to the booth and if any counterfeited coins are checked, then ask if you can look at the coin and again ask questions.

I also deplore the oneupmanship that is seen in a lot of discussions on coin group/list sites! It is good to debate an issue but to bash a poster's comments or take on a "How Dare You question My Knowledge or Authority" attitude, does not belong on any website or forum. We all ingest other's writings in different ways and what may be simple discussion to some, will be viewed as attacks by others. This is many times the case in forum disputes, so we all need to take a break at times to re-read our' and other's postings to see what is actually being said and not respond right away when we our emotions can get the best of us!


The Other, Other Frank

 

Ben:
Great question, about the education. Most of the 'experts' out there are (I believe) self taught, or worked for other authenticators or major services.
The ANACS (for one) has a very large collection of fakes that they use for identification purposes, and, whenever there is a new one that they identify they try to keep a copy of their records and for study.
Also, I believe that the ANA has classes each summer that include counterfeit detection.
Check their website for more info, but, I, for one, am not a fan of theirs, until they fire Cippoletti. (That'll probably be enough for him to fire off another letter to Coin World, and use his usual legalese to justify the ways that he is destroying a fine institution. I should include some typos so that he can say that I am ignorant, not like his educated self.)

 

Been looking at the book I received for Christmas (The Coin Collector's Survival Manual" by Scott Travers) and wanted some opinions.

He suggest a few different books as guides to grading.

He suggested:

"Official ANA Grading Standards for U.S. Coins, Sixth Edition"

a book that he edited "The official guide to coin grading and counterfit detection" by PCGS

"The NCI Grading Guide"

"Making the Grade, A Grading Guide to the Top 25 Most Widely Collected U.S. Coins" in 2005

Which one is the best in your opinion and why?

What are some differences between them that make them better or worse than the others?

Is the ANA book complete or not?

 

I would use the ANA Grading guide---the newest edition is alright----I use the 5th.
Photograde is also a great one for circulated grades.
When it comes to MS and PF grades I think the PCGS's guide and just hands on is the best anyone can do at this time when market grading is the main player in grading.

Speedy

 

Doug,

You hit it on the head with a very well thought out and written post! It is long past the time for us to speak out and to do what is needed to bring change. We all have been puppets in the game for higher profits on coins, ways to dupe the new and less knowledgeable Collectors as well as the elderly which are highly susceptible to scams (such as the "First Strike" scam) out of their money and now it is time to cut the strings and demand freedom from our repressers! Okay folks, it is time to let us and others know what you think and that you are no longer going to take it.


The Other, Other Frank

 

So nothing has really changed for the better in the five years since you wrote this or however many years since competition with ANACS began. Your right Doug, there's no single standard all grading companies adhere to and there are many more (new and different ones almost daily) grading now than ever. It's really Out-Of-Control...

When a quick buck is to be made standards go out the window. The ANA needs to get a powerful attorney and parlay with the Federal Reserve System/Mint. Sit down over coffee and inform them exactly what the goings on in Coin Collecting are. Has this ever been tried?

I mean if the FED and the U.S. Mint can make the (New, Unique, and Extremely Valuable) material which collectors fawn over then they should be aware of the shenanigans being pulled in the name of the game. I'll be willing to bet if Ben Bernanke got burned on a Golden Buffalo from Star Grading Service with a First Strike, MS-70 designation that had a giant thumb-print there would be some rumblings in the belly of the beast.

Since coin collecting is turning into an investment method and many times a large part of ones portfolio Federal Regulation needs to be implemented. Just like banks and credit unions Third Party Grading Companies have got to be held to a upfront, transparent, and established standard...

We've all heard the jokes about Joe's or Fred's bank

Ben

 

Thanks for the short answer Speedy!

GDJMSP makes a great point, and I am sure it is an accurate statement if you desire to be among the 1 to 3 % of individuals that are considered "Masters or Experts" in the collecting / investing / minting / grading / dealer community. That is not my desire nor do I think Doug really believes it is the desire of the majority of collectors. This does reinforce the need though for a set standard everyone follows to help the other 97% understand what the TPG basis its decisions on.

Grading should be level (although it will always be somewhat subjective) and the TPGs should differentiate themselves by the additional services they provide.

The additional services probably make up a large portion of revenue and if it doesn't, then they should all have different marketing teams... I've worked in Marketing for a global 500 and this appears to be easy money. (sorry for the pun) Serious collectors that spend tons of money a year are probably a great source of revenue for added services.

I have heard comments like we trust this TPG company more than the others because they are tougher and more stringent. Sounds like a good marketing strategy for the TPG to gain confidence but maybe not always fair to the individual.?. On that same line of thought I'm sure it has resulted in a loss of business for the TPG because of my concern.

It really is all just mind boggling to the beginner collector that has limited time and money to invest. It would be sooooo much easier to have a set standard to follow and study.

I would like to hear more about that 5-year-old response from GDJMSP. You say it was published; what kind of feedback did you get?

Unfortunately the major magazines probably make significant revenue from the advertising of the TPGs. If that weren’t the case, it would be a great source for getting more collectors involved to gain support.

I'm going to have to spend some time looking at the structure of the ANA, like how are the officers placed in position, is it non-profit, what rules if any do they follow, how are they working to improve the hobby, ect. Seems like it should be another great body of influence but is failing at some levels for some reason not apparent to within this discussion.

Darryl

 

What if major TPGs somehow agreed on a Universal standard? There would be pressure driving existing slabs towards obsolesce. What happens when people start sending in their obsolete slabs and get back Universal slabs with lower grades on them? The lawsuits are going to be flying, claiming that the old grading was too loose to begin with and that Universal Standards are just a golden parachute for TPGs-- a way of granting themselves absolution for 20 years of digressions. Claims, that would of course, be entirely baseless. :whistle:

 

Have you ever filed a lawsuit? It is expensive, lengthy, and not always a winning proposition.

The collectors should take charge and sooner rather than later. People should not just let this continue because of 20 years of bad business. Within a year or two of the change it would probably settle down to a manageable issue and moving forward everyone would be much better off. The TPG's would probably recover any losses pretty quickly if they acted less like former President Clinton and more like a business that wanted to survive under a new set of rules. I can see some less reputable businesses going bankrupt but that probably happens on a regular basis anyways.

The market determins value and the good dealers and smarter collectors know which grading companies are loose and which are not. As a seller you were only going to get what the market really preceived it to be worth regardless of the grade by the TPG. If you bought it with a grade higher than the actual then you probably did not know enough about coins or do your due diligence before you bought it. Some of the blame would squarly lie on the buyer/collector/dealer that got taken. Coins are investments and some are riskier than others and not all investments work out.

 

I believe there are two class action lawsuits in progress right now, reguardless of how expensive or lengthy they might be. I don't believe anything would settle down in year or two if Universal Standard were implemented. The Brown and Dunn grading guide from the 50's could have been the Universal Standard, if the desire for a Universal Standard was actally standard with dealers and collectors of that time. Apparently it wasn't. And IMO, it isn't today either. There are people making money from too many different standards today as there were people making money from no standards in the 30's and 40's. It the same problem only in reverse. Even the idea of third party grading is hardly new. The call for: "A Standard Rating Agency For Coin Grading" was made as early as 1959 by ANA member Bryan Lumpkin.

You stated: "good dealers and smarter collectors know which grading companies are loose and which are not."

If this is the case why should the good ones wish to have others riding their coat-tails with a Universal Standard? Why, if they can stand on their own merit, would they want to submit to the control of "code-enforcement" and no doubt be forced to pay shake-down fees for that enforcement?

 

Those cases and any others will be precedents for future cases. If they go against the TPGs then you will probably see many more coming regardless of standardization.

I don't believe for a minute the TPG's want standardization regardless of where they fall on the meter of good or bad. They provide a service to the dealers, collectors, and hobby in general - period.

It is those individuals that collect/deal that should demand a standard to keep the TPGs from acting in ways that hurt the hobby. Unfortunately TPGs all stand on their own merit - some loose and cheep, some tough and expensive; How about a level field of fair and accurate.

 

Alert - this is an old post I'm resurrecting!

A few years have passed since this thread was written. Presently, PCGS and NGC are the acknowledged leaders in the grading business and, for the most part, are trusted if not entirely consistent with each other.

Doug or anyone else who has read this thread - Do you still think that a common standard should still be advocated or do you think we have gravitated toward some kind of imperfect standard with the top two TPGs that you find acceptable?

 

Well, I hope it happens. I'll stand with ya.

And if it happens, it needs to be a top-to-bottom overhaul, not a minor tweak. The existing system is intrinsically flawed.

1) 1-70 scale ? What tha...? Wha...? Make it 1-100

2) 1, 2, 3, 4, 6, 8, 10, 12, 15... ? What tha...? Wha...? No skipping numbers

3) All facets of a coin rolled into one grade ? Why ? Grade coins like you do diamonds, with a separate score for each parameter. 1-100 luster, 1-100 details, 1-100 surface preservation, ... etc

At that point, the individual can weigh the scores any way he pleases and come up with a composite score. i.e. 30% details, 20% luster, etc.

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Two main problems:

1) Getting broad, solid consensus

2) Transition from old to new. This is much tougher.

Imagine the confusion as the new system begins to take hold. You walk into coin shows with many slabs old style, some new. Same with dealers - some will grade the new way, but most will lag and do things "old school". They are slow to change.

Then there will be a "rumor mill" about which system (old or new) brings the most money for a given coin.

And of course all this is a major windfall for the TPGs, as they regrade millions of coins in transition. Which will spawn much superstition about which TPG gives the most advantageous crossover from old to new.

And then comes CAC.

Major auction houses will either use both systems concurrently until the last old slab is gone -OR- offer to submit consignments to TPGs before the auction. THAT is a whole topic unto itself.

And, of course, the last old slab will NEVER be gone. Nobody will want to submit any OVERGRADED COINS, so they'll stay in Old School coin coffins forever.

It's like when the UK switched to the decimal system. Confusion for a while, but things settled down. But that was a lot smoother than this will be.

Another big winner - Coin Talk. Imagine the dialogue ! Never ending debate.
:loud: :secret: :headbang:

 

Then again, 900fine, it could turn out like "New Coke" - a disaster!

http://www.msnbc.msn.com/id/7209828/