Grade Inflation or Why is midrange UNC gold all junk?

I've been looking for decent mid-range $20 Libs and lately $5 Libs for some time.
With the Double Eagles, I've been looking at online auction sites for several years. Always had problems as everything I find is heavily bagmarked.

Now have been looking at Half Eagles. Looking through pieces even up to ms-64 grades, I'm finding heavily bag marked coins.

It seems grade inflation has gotten particularly bad these days. Does anyone else have these problems? I guess that's why in-person coin shows still have such big draws?

 

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I am very leery of slabbed coins. I stopped purchasing online slabs because more often than not, you don't know what you are truly getting until it is in hand. The top two TPG's are not innocent by any stretch. My opinion and I will stick by it!

 

When were the coins you are looking at graded ? They could have been from a period when loose market grading was in effect like 15-20 years ago.

You get a CACG or PCGS/NGC CAC coin and I don't think you will have to worry.

 

Slabbed U.S coins became overpriced marginal crap to me over 20 years ago. Been buying exonumia ever since.

 

The intrinsic (gold melt) value swamps the numismatic value and makes them useless except for bullion.

If you look at common date gold price guides (let's table the discussion about price guides - I admit it's a bit of a circular argument)...

Let's at random use a 1923 $20 (Double Eagle) which is considered common up to MS63.

From XF40 up to MS53, there is a $5 increase per grade (including plus)... it goes to $10 then $15 then $25.

XF40..... $2,430
MS60..... $2,550

They are all the same just less than an ounce of gold, thus each grade is just a trivial increase in numismatic value.

Certainly, there is a premium over price guide for nice coins. But run of the mill... it's bullion value plus a skosh.

The jump from MS63 ($2,700) to MS64 ($3,000) to MS65 ($6,250) to MS66 ($85,000) is where you finally see numismatic value.

 

I bought a pair of double eagles from eBay years ago, and I thought sure they were details coins -- lots of missing luster, bag-marked to death, ugly as sin. I showed them to a dealer at a local show, and he said "oh, no, these are perfectly good, that's what low-MS gold looks like!" I flipped them to him for a quick profit (I'd landed them below melt), and thought I was getting the good end of the deal. Of course I feel some regret now that gold has gone up 70-80%...

 

Maybe I'm being a little simple here, but I for one buy most of my gold slabbed... Yes, I know this usually adds a considerable premium, but in my case and many others I don't consider myself knowledgable enough to pick out some of the new "fakes" from real. In my case there are no LCSs nearby and none that I know well enough to trust on such a large purchase. That being the case an NGC or PCGS certification as well as verification pics of the coin make me feel 100% safer on such purchases... I'd much rather pay the additional premium on a real gold coin then buy a fake and be stuck for the price

 

I'm gonna tell @GDJMSP you said that.

 

Without regard to gold, in silver I see many head scratchers with regard to Morgans. Some seem overgraded and some seem undergraded. Consistent inconsistency, and that's with coin in hand. What may hurt a few people' feelings, ANACS seems to be the strictest grader after looking at many slabs. Many of them seem undergraded, especially from AU/low MS category.

 

Let's talk about grading standards. Here is a perfect example of my argument. Does this look like it's been polished to anyone else? This is supposed to be the gold standard of graders. To my eye, this does not look like a natural patina.

 

Gold is so much different than silver when it comes to grading them.

 

It may help if your expertise is illustrated:

Post any random 3 silver pieces and 3 gold pieces that you have, that your opinion is are worthy of what YOU consider are Grade64, 65, and 66.

Then, the members can randomly select...the same denomination (and to make the exercise more interesting, the same years), the same quantity and Grades in a PCGS/NGC/ANACS/ICG/CAC and CACG

Are you in?

Begin.....

Truth in editing: removed an extra word "silver".

 

You must like then what CACG is doing, as they are really hewing to the technical ANA standards and driving people nuts with all the MS coins getting downgraded to AU because of wear/friction/rub.

 

JA and CAC/CACG have a reputation for being "tough" on gold.

 

Grade-flation is annoying to me because it has depressed a lot of prices. To get the money out of your coins at auction, it seems like you have to have them regraded.

One example is the Type I gold dollar. When I was continuing to build my type set, an MS-65 graded common (1853, the most common of all) date Type I gold dollar sold for $4,500 to $5,000. I thought that was too much money. I bought this one at an inflated price, under $2,000, which was in an MS-64 holder. A dealer had set it aside to crack out for a possible upgrade. That's why I paid "too much."




Today the Grey Sheet bids for MS-64 and 65 are $1,450 and $2,150 respectively. Has the bottom fallen out of the market? No. It's because the current MS-64 and 65 coins are not what they used to be. You are not getting as much a coin for the given grade, so people are paying less for them.

The lower grading standards have also increased the supply in the MS-65 grade. Therefore the prices are less.

 

Reputations and reality can sometimes be different things. Does this look like an MS-63 CAC to you? Believe it or not it is, or at least it was about 8 years ago. Look at the rub about the eagle on the reverse.