Shouldn't grading companies be non-profit?

Oh, don't be sorry to me. Just a warning from someone who occasionally posts something funny (at the expense of the current president BY ACCIDENT!) and gets his posts deleted.

 

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You are kind of on the right track, except the government has never wanted coins to be allowed in IRA's. They finally made the concession to allow Gold and silver eagles in IRA's, Then added coins produced by the states. (This was because for a short time several stated wanted to produce their own gold and silver one ounce rounds and they wanted those to be IRA eligible. But then the states lost interest.) Later they allowed any gold or silver coin above .995 fineness.

However there was never any requirement that the coins had to be independently graded/certified.

What happened was WALL STREET became interested in investing in rare coins but there was the problem that it takes a lot of knowledge to understand coins. So the grading services came along and sold wall street on the idea that by professionally grading the coins they would be fungible. In other words interchangeable. They sold them on the idea that coins could be made like shares of stock. One share of stock is like any other share so it doesn't matter which particular share you get. They were told that with the professional grading one MS-65 coin of any given date and series was exactly the same as any other MS-65 of that date and series. The theory was that this would allow sight unseen trading. You order a MS-65 1881 S Morgan and it doesn't matter which one you actually get because supposedly they are all the same.

Wall Street bought into the idea and and investment portfolios were set up. You can imagine how it actually ended up.

 

I'd read about the late-1980s run-up (here and elsewhere), but apparently had quite a few of the basic facts confused.

I found a thread on another forum (with a number of our members featuring prominently ) that helped me get it all re-sorted. The post I linked directly quotes a Money Magazine article that really clarified things for me. (Yet another tip of the hat to @GoldFinger1969!)

So, bottom line, the run-up was driven by speculation about new coin-based mutual funds driving up demand, not by any change in Federal IRA policy. Right?

 

Correct.

It was also one of the things that drove the coin market to silly levels in 88 and 89, "Wall Street has a TON of money and they are going to buy up everything!" Remember at that time MS-65 was considered to be "investment quality". It was amazing watching MS-65 1881 S morgan dollars approaching $1K apiece.

 

My point is I did a little research and found out that there was like 9 grading companies and most are not around anymore and the reason has to be because they didn't properly do what they suppose to

 

Or he’s looking at an SGS, NCG, PCI, PGS, etc. basement slab

 

Unless you have a natural spring/well on your property, you have to have infrastructure to bring the water to you and clean it. Unless you own that infrastructure, you have to pay for the using that infrastructure and the service of cleaning and delivering the water to you.

As for air, I can see there being a tax to help pay for anti-pollution measures that make the air cleaner

 

You also need money/profit to entice leading hobby experts to work in your sweat mill

 

And then more got graded. And then more. And then standards were relaxed. And then more were graded. And then even more.

Not 65’s can be had for less than $125 for common dates, sometimes down to $90!

Chinese coins are in a similar bubble. What could be easily purchased for $50 last year will cost over $100.

 

Take your pic on the right side of the page. There have been many basement slabbers in the past not just 9.
https://coinauctionshelp.com/Hallmark_Imitation_TPGS.html#.X-uZXdhKjIV
This doesn't even include some of the fly by night slabbers that tried making money.

 

I'm up to over 160 companies. But you are right most of them are no longer around.

 

i have a kennedy pcgsdcam 70 that has coin edge marks on field and a scratch on his head, go figure...lol

 

Some people think ALL companies should be non profit, if you live in a communist country.

 

thats all part of there company they have a right to make a profit how else would they pay the bills and still make something extra people would not be in business long with out profit

 

Photo?