Okay, so I've spent the weekend talking about prices in the Red Book. What price list(s) do dealers use to price coins, and what set of standards do they use in grading their coins? (The only standards I'm aware of are the ANA standards.)
A lot of dealers will use greysheet to price a coin but the greysheet is often very off on the values of coins, sometimes by a few dollars, sometimes by hundreds or thousands of dollars. Although from what I've seen, it is usually a decent indicator for very common coins like MS64, common date Morgans or modern proof set. In the end, the best way to price a coin is by past auction sales.
A lot of people use ebay to price their stuff some also you heritage auctions and other online auction sites to get a good idea of selling price basically it shows you about what coins are selling for and what people are willing to pay !! Redbook might value let say a coin most people know a 1877 Indian head penny rebook value in g4 is 900 dollars now go on ebay people can not even move them for $550 graded by pcgs or ngc so that is good example of how to use the redbook i use it as a judge for the max a coin could sell at and i usually unless it is a very nice coin try to pay about half of its redbook value also a lot of guys on hear if willing will give you very good estimates !!
You are touching on something that so peeved me off today that I am about to do a post about it (Ebay and grading standards). Let me just say (from having spent 40+ hours on Ebay this week buying and selling, Ebay prices are all over the rainbow. Yes you can find some stuff at ridiculous prices especially if you snipe in the final seconds of an auction closing. Nothing like bagging at 3am that old Morgan no one bid on which still has the 'start at' price. Or last week I bagged an entire Dansco of Washington Silver in AU (allegedly, the pics agree, but I will know more when it arrives) for only about $350. Got a BU 1921 Peace for $93, which supports the Sean's claim. Alternatively, a heck of a lot of stuff on the 'bay is way, way, overpriced. Especially slabbed coins. Too many sellers seem to be adding the cost of their NGC/PCGS membership and submission fees to the Redbook prices, then starting there. For instance, I recently saw a 1964 slabbed Washington in MS 63 going for 'buy it now' $75. I watched it out of curiosity, and durn if someone didn't buy it. A fool and their money. Whoever that buyer was, he 'walked' right past lots of untouched rolls of uncirculated Washington quarters for a heck of a lot cheaper. Can we say AMPEX? Hey, I don't know. Maybe that was a pre-arranged money laundering operation. Police: "How'd you get all that money James, you selling drugs?" James: "Oh no sir. While going through Dad's belongings (may he rest in peace) I found some slabbed coins dated 1964 and when I put them on Ebay at high prices, someone bought them." I noticed this week a heck of a lot of slabbed stuff (especially the overpriced ones) gets re-listed often. I am also noticing the majority of coins from many of the dealers are priced way over Redbook for grades corresponding to the pictures being shown. Alternatively, a lot of the little guys (i.e., real people vs. corporations) seem to have fair prices. Caveat Emptor of course.
Each TPG has their own set of standards for grading, most of which is based from the ANA standards, but then they have added their own criteria for certain aspects of grading. For instance; PCGS only assesses the bottom set of bell lines for an FBL designation on Franklin halves, wherein NGC assesses both sets of bell lines(as it should be IMO). Pretty much the ANA grading standards, are the base most everyone uses when grading coins. With regards to pricing, most use the CDN or greysheet. Other's track the market from online completed sales at various venues. What it all boils down to with regards to a coin's value, is what it's worth to the buyer to add it to their collection.
Yes, there are a great many of them. NGC has its own set of standards, but those standards are not published anywhere and nobody except NGC and their employees knows exactly what those standards are. PCGS has its own set of standards which has been published twice in books, the most recent of which was published in 2006. That said, when actually grading coins, PCGS does not follow those published standards. Both NGC and PCGS have changed their grading standards several times over the years with the standards they each use today being more lenient than those used in previous years. ANACS, ICG, both have their own different sets of grading standards. But the ANACS standards have changed several times over the years depending on who owned the company at that specific time. Same thing for ICG. Then you also have all of the other companies who have slabbed coins, with each being different from all of the others. You can also find grading standards published by Coin World, Photograde, various individual authors, web sites, and other numismatic magazines and books. And many coin dealers, and even collectors, also use their own individual sets of grading standards. Even the ANA now has 7 different books published containing their grading standards with the first published in 1977 and the most recent, the 7th, published just this year. And the ANA standards have also changed, in both directions. For example, the ANA standards published in 1987 are more strict than those published in previous years. But the ANA standards published in 2005 are more lenient than those published in 1987. As of yet I have not reviewed the ANA standards published in 2013. Bottom line there are so many sets of grading standards that any assigned grade on any coin can vary greatly depending not only on who did the grading, but also when they did the grading. As for your question on what price lists dealers use - that depends on the individual dealer. Many of them use the Coin Dealer's Newsletter also known as the Grey Sheet. Others use no price list at all but instead base their asking prices purely on what they paid for any given coin. And the percentage they ask over what they paid can vary greatly. This sometimes results in dealer A asking double or even more than what dealer B is asking for the exact same coin. Add all of this together and you have one big mess. Many people have the idea that any given coin in any given grade is worth X number of dollars. But this is far, far, from being the case. It is not even close to being true ! The reality is that any given coin in any given grade can be worth anywhere from X number of dollars to XXXXXXXXXX (10 times) number of dollars and sometimes even more, depending on many variables.
Yup. Coin prices are determined by the market, i.e., what the buyer is willing to pay. Not by what a third party thinks it is. You add a dose of reality I had forgotten on the whole grading issue. I simply forgot that the grading services are companies that can be bought and sold and change hands and change policies from day to day if some Board of Directors, CEO or manager feels like it. Silly me, I had been viewing them more as a guild with members that vote on standards (such as SAE or the AMA) rather than a company subject to the whims of management. This has consequences for all of us of course. We have all (if over 30) seen it before in many other industries, from guns and cars to food stuffs and appliances. One year the company makes a great product, 5 - 18 or 30 years later they are turning out junk. What happened? Someone bought the company and decided to count on name recognition to ensure sales while at the same time turning out a cheaper product. What does that mean for us? That maybe someday someone will buy a well respected slab company and really lower the standards. This could impact in all sorts of ways from lost coins to worthless certifications. Pick a slab company, call it XYZ coin rating. Because it is a private company it gets inherited. The kid has poor judgement or a drug habit or likes life in the fast lane. Next thing you know, although XYZ slabbed coins once had an impeccable reputation, not only have they begun grading junk as MS, rumors of counterfeit coins being slabbed and certified as genuine have also begun to percolate. Worse, their newest slabs look just like the older slabs. What would that do to your personal coin collection's value, if all of your coins had been slabbed by XYZ coin rating? I suspect the best solution (which because I got out of coins for a few decades and wasn't paying attention when slabbing started had assumed (there is that word) that slabbing was being overseen by one of the associations) is for one of the coin guilds or associations to begin a slabbing company literally owned by the group rather than a company begun by one person. Yes, I know, someone always dominates. This can probably be offset by the guild choosing a CEO who reports to the guild, rather than a member of the guild directly running the company.
That was actually done, in fact that was how it all started back in the 1970's. The ANA started its own grading company - ANACS. But it was plagued with problems from the very beginning. Back then they issued certificates, not slabs, slabs came much later. Many different things happened and many things changed from time to time, including grading standards. There were even law suits regarding changing grading standards. And in the decades that have followed there have been many more changes regarding standards, ownership of the company, the opening of new grading companies, etc etc etc. Eventually it has evolved into what we have today - a mess. True, it's a better mess than what we used to have, but nonetheless it is still a mess. While I readily agree with you that we need, what the hobby needs, is a single universal set of grading standards that is followed religiously by ALL of the grading companies, and all collectors and all dealers alike; and that those grading standards are set in stone and never change - it is extremely unlikely to ever happen. Why ? Because it would in effect put all of these businesses (grading companies) out of business. The purpose of any business is to make money. And if all of the businesses were exactly the same and all followed the same set of grading standards they would have nothing unique to offer their customers. You see it is the customers who are the problem, not the companies. The companies only give their customers what they want, like any good company that wants to stay in business. And customers want their coins graded the way they want them graded. So they gravitate to the different company who does that for them. But if the standards were more strict and coins that are currently graded as 65 came back as 63's then people, the customers, would not be happy. And the next coins they sent in to be graded would go to a different company. The customers are in charge, not the companies. It is the customers who have the money, control the money, and choose where to spend it, choose what company to give their money to. So until the customers change and decide that they want a universal and unchanging set of grading standards that is to be followed by everybody - nothing will change.
