...or more specifically, PCGS coins and the buyers who overpay for them would be a better title for this thread! Tell me, why do people pay so much more for a coin than the coin is worth just because some fella at PCGS took a look at the coin and stuck it in a holder? After seeing the prices some people are willing to pay for many of these coins just because they're in a PCGS holder I'm beginning to think that it might be worth recommending to anyone that it is financially beneficial to send off even their most worn and worthless coins. Case in point: http://cgi.ebay.com/1798-DRAPED-BUS...39:1|66:2|65:13|240:1318&_trksid=p3286.c0.m14
Some do it for the registry, some do it because they are uneducated and just don't know any better. And with coins of that grade, some do it simply because it is graded that low.
I'm not some sort of cheerleader for TPG's but it is obvious to me that something is worth what someone else is willing to give you in return for that "something". Therefore I would have to argue that by the very nature of exchange graded coins establish their own worth every time they are sold. One actual benefit I can think of is that most people cannot grade as well as the TPG's. If you buy over-graded raw coins I would argue you would be better off financially buying sight-unseen graded coins at bluesheet prices. I can only represent a small chunk of land, but where I live the local coin dealer charges pretty high prices for his over-graded raw coins. In fact I'm not even sure where he gets his prices from, since he uses outdated ways of describing his raw coins. The point is if you can buy coins with accurate industry acceptable descriptions which is backed by a guarantee why not pay a little more? I guess I could go down the street and pay MS64 (pcgs price guide) prices for a "GEM BU" coin, or I could just go on the internet and find the nicest coin I can find from 62-64. I can usually pick these coins up for the same price or cheaper than the stuff my local dealer has in old 2x2's. I guess it just comes down to circumstance. If my local dealer had accurately graded coins for less money I would probably have a different opinion.
You are quite correct, but don't you think you left out one important point ? Something is truly worth what an educated buyer will pay for it, not just any buyer. For if the buyer has no idea of what an item is worth, who can say that what he pays for that item is an accurate portrayal of the items true value ? For example, if you put up a given coin on ebay and somebody bids it up to $350 and pays that. But 3 other known numismatists, who really know their stuff, only bid up to $100 before dropping out - do you think that coin is truly worth $350 ? I do not. I think it is worth much closer to $100.
Good points, shoe on the other foot for a second now. It takes two bidiots to overbid on a coin. There has to be at least two bidders willing to pay over price on any particular item. The item does not have to be worth the winning bid simply because somebody pays that for it. At that point in time it was worth it to at least two people for whatever reason though. Kind of like getting drunk at a bar, man she looked good when we went home last night, but WHOA.. in the morning....
I mostly agree with you, but sometimes things get turned up-side-down. If you put 10 of those coins on eBay and 8 of them sell for $100ish, you are absolutely correct. However, if 7, 9, or so of them sell for $300ish, maybe the "experts" are going to have to relearn their prices.
I totally agree that someone can overvalue and item, and overpay for an item, but I am not talking about the exceptions. There are esablished prices, and fair market values for used cars, just like there are for graded coins. If you grossly overpay for something it is your loss, and the seller's gain. The point I am making is graded coins coins can carry a premium and do carry a premium over raw coins "in general". These prices are accepted by the market, otherwise the prices would not be achieved. Now having said that I also do not believe that paying "slabbed" prices for a aw coin is out of the question if it is properly graded. Uneducated buyers are usually going to get the raw end of the deal regardless of how they are purchasing their coins. Case in point.... 1883 O Morgan thread... Guess who gets the raw end of the deal? ME! However it is graded by PCGS, so would you rather own that coin the way I do, or in a 2x2????
I got that PCGS MS64 1883-O Morgan for 72 bucks including shipping. Somehow I think I will get my money back by reselling it locally if I really want to. Now if that coin were raw I may have a hard time selling it, especially to GDJMSP.... haha Instead I'll just treat it like a used car........
Some coins graded by PCGS I'll spend book value or slightly more, but only if I can't find another one by NGC first.
Gopher, I am going to try to ignore most of the responses to you OP since they don't really address the issue that you raised. However, you need to qualify what coins you are talking about when you make the statement about collectors overpaying for PCGS coins. If you look at common date Morgan Dollars in MS64 or MS65, you will find very little difference in price between PCGS and NGC graded coins. If you look at MS67 graded Jefferson Nickels, you will find a huge price difference. Before you criticize people for paying more for PCGS coins, you should examine why they do this. In the case of MS67 Jefferson Nickels for any date, the reason is obvious and the population reports don't lie. If you don't believe me, let us take a look. I have listed below the 1945 P-D-S Jefferson Nickel populations and Numismedia Wholesale and PCGS Price guides. 1945-P NGC POP 322/2 ---------- PCGS POP 33/0 ----------- Numismedia Wholesale $160 -----------PCGS Price Guide $750 1945-D NGC POP 2046/6 ----------PCGS POP 112/0---------- Numismedia Wholesale $47--------- PCGS Price Guide $110 1945-S NGC POP 1512/2---------- PCGS POP 72/1 ----------Numismedia Wholesale $56---------- PCGS Price Guide $140 You can't seriously look at the population reports and conclude that the both TPG's are using the same standard for MS67 for Jefferson Nickels. The fact is that an MS67 PCGS Jefferson Nickel is much more rare than an NGC MS67 Jefferson Nickel. The price guides and prices realized at auction support this fact. If you look at the last 4 NGC 1945-P Jeffs, the average price is $152 which is just below Numismedia Wholesale. The last two PCGS 1945-P MS67's (that were not monster toned) realized over $500 each. (The auction data referenced is from Heritage Auctions). I am not going to defend the PCGS price guides. I think they are ridiculous. However, it is a plain fact that PCGS grades certain coins more stringently than NGC and the PCGS coins deserve to drive a higher price in these cases. Now that I have concluded my diatribe, I will state that I have no idea why anyone would buy the coin referenced in your OP slabbed or not. I can't even tell what the heck it is.
Which one of you all attributed this coin? Who knows - maybe the buyer of this coin recognized the variety and maybe it is worth that price. Yeah - I understand the reasoning behind this thread, but who knows maybe this coin is one of the r5, r6 or r7 varieties. Just wanted to throw this out there.
Don't forget the Vammers, and the cherrypickers. I can think of more than 1 occasion that I have yanked Rpm's, etc off the bay and elsewhere, all in TPG holders, but unattributed.
Yep - that 1882 IHC I bought looks like an overpaid MS63(and I guess it is until it is re-sold ), but being the snow-6 variety makes it worth a lot more.
People collect odd stuff Gopher. What may be odd to you and I may not be to them though. We have a customer that I recently met who has the PCGS LOWEST grade Morgan set in Registry. This was not an accident. He has worked hard on this set actually. When we buy if I see EXTREMELY worn, original pieces I set them aside for him. We have another customer that just completed his set of holed Peace Dollars. On the other hand there are many "investors" that never took the time to really learn a lot about coins or the way the market works. Yes, may be geniuses in other fields but put them in coins and they don't do the homework. My older brother could have fallen into this category. Luckily he asked me first. When ebay was much younger and smaller I did pretty well with low dollar stuff. 30% margin was pretty much the norm. Well over 100% ws not uncommon with paper money. So now my brother wants to get into it (after making fun of my hobby for years BTW). I told him fine. Study it for a few years and get back to me when you know something. End of that. I am still the only active collector and sometimes seller in my family. As stated earlier it only takes a few "bidiots" (like that term) to jack up the price. Many times these are the same people that think they are getting a great deal on a "self slabber" coin. At the shop we currenty have about 5 MS66 Morgans in our case. All graded by NAC. They're priced at $30 each. We all know why. AU-MS coins that may have been cleaned. Not even worth wasting our time with them. They walked in the door, the boss bought them cheap and broke somebody's heart. It happens all the time to those that DO NOT do a bit of homework. I DO respect the better respected TPGs to an extent but don't just go by the number on the slab. Information is available and it's a shame that more don't take advantage of it.
To a large degree I agree that slabbed coins will generally bring more than the same coin raw. And I agree with this as well. An educated buyer will pay the same amount for a coin whether it is raw or slabbed. And this is what too many forget, an educated buyer virtually ignores the slab anyway for to him it is meaningless.
Always buy the coin, not the holder and if the coin looks average or weak for the grade, pass on it even if it is in a PCGS holder.
