What is CAC Actually Saying with the Award of a Bean?

Many of us enjoy playing the "To CAC or Not to CAC" game thread. It is fun and educational. We all know that CAC awards a green bean for a coin that they agree is an A or B coin for the TPG assigned grade. CAC also says that they do not grade coins, per se. All good to this point.

We also all know that the TPGs indulge in market grading where the assigned grade is not a technical grade but rather a grade the reflects what the TPG thinks the coin should bring in the market. The classic example of this is the so-called AU-62 coin.

So, let's posit that CAC receives a graded MS-62 coin that we all agree is actually a high-end AU that deserves a better price than the typical AU. What is CAC doing with this coin? Are there any other options than:

1) Refuse to consider it at all because the coin is not accurately technically graded?
Under this option, it would seem that CAC is violating its public statements that it is not grading coins.
2) Consider it, but always give it a C and thus never award a bean?
Ditto comment under Option 1
3) Consider it like it would any other coin that is not grossly market-graded?
Under this option, CAC's business proposition is no different than that of the TPGs. CAC is certifying that the coin is accurately MARKET-GRADED. In effect, they're agreeing with the TPGs estimate of the value of the coin.

I tend to gravitate toward Option 3 as being the only viable interpretation. Are there others and what is your opinion?

If this is so obvious that a caveman would get it, then just call me a simpleton and I'll go back to my cave in the woods.

 

Log in or Sign up to hide this ad.

It's hard to say what CAC is thinking since we don't have any definitive published standards.

My guess is similar to yours that they tend to go with option 3 and approve or reject based on Market Grading. Their interpretation of market grading is likely different than the TPGs in some cases (like cleaned and retoned coins or overly dipped coins).

 

Accurately or overgraded just doesn't get a sticker on it. it's more like "grade quality assurance" for the green bean and the gold bean means they believe if resubmitted it was under graded and should grade up, in essence, too good for the grade level compared to the rejected for beans they've seen, and the green beans. a coin graded MS62 that is a low end MS62, or a mis-graded AU, would get you a rejection letter.

The CAC stickers are supposed to be quality assurance for the grade on the slab from the TPG.

it's a marketing gimmick to get $14.50 per coin out of your pocket, They say "The green CAC are bringing 5 to 15 percent more on average, and coins with gold stickers are selling for roughly 80% to 90% percent as much as those already certified in the next higher grade." Who knows, probably worth it if the 10-20% is more than the $14.50 cost. LOL Maybe I would get my 2019S ERP silver eagle graded and if PR70 send it to CAC and see if they give me a green or gold bean! maybe worth the extra $100-300 sale price.... yeah.. gimmick

I think they figured out a way to check out your coins early and then mark the ones they'd like to buy if they ever come up on the market, and got people to pay them to do it to boot. Smart!

 

This is the nefarious thing about CAC labels. People have major biases. If you see a label saying "X-Free", consumers will automatically assume "X" is bad, and be attracted to something without X. Similarly, put a QA sticker on a coin, and consumers will start to view coins without said sticker as inferior, as in "I wonder why it could never get a bean".

Now, if the CAC was reviewing ALL slabbed coins, and PUBLISHING those that in their view do not warrant the grade, this COULD be good for the hobby. But they AREN'T. They are simply cherrypicking certain coins, and how they do it are effectively demeaning coins WITHOUT the stickers.

It really is a sneaky program, that effectively bad mouths and makes all other coins worth less money unless you pay them their pound of flesh. WE already had billions sucked out of this hobby by TPG slabbers, and now this. I predict the next iteration will be plastic sleeves over the slabs, grading the condition of the CAC and TPG slab. Can someone say "mint with mint tags beanie babies"? Everyone wants to make money from coin collectors without actually, you know, buying and selling coins.

I know, "but Chris, how do you REALLY feel"? I become animated when talking about my favorite hobby, sorry.

 

Green means the assigned grade and designations meet their standard. Gold means that the coin would at the very least green sticker at the next grade up. The one thing they do ignore is the + grade so a 65+ would be treated the same as a 65.

As for your question it depends. There's been countless threads on CU about similar topics (most of which got deleted after turning into dumpster fires) from people that do actually no. Many comments have shown something along the lines that CAC generally dislikes rub but if the rest of the coin is nice enough you could still get a sticker.

If someone wanted to ask Mark Field over on CU you'd likely get a much better more conclusive answer as he actually has experience working for CAC for a show or a brief time

 

All CAC is supposed to be saying is that John Albanese's network of dealers are willing to pay an undisclosed price for a coin because they think the assigned grade is consistent with the market. Note that I said "consistent with the market" which says that market grading is in play.

Those who swear by CAC tell us that John Albanese is the greatest grader in the industry and that every coin he gives a green bean to is at least solid for the grade. Although CAC makes no such claim, CAC fans tell us that any coin without the sticker is over graded and therefore “dreck” in the lexicon of a well-known CAC advocate.

Furthermore, the CAC clique makes the claim that Albanese has seen every graded coin and that he has reviewed every coin that appears in the major auctions. I think that those are absurd claims. Furthermore, many of us have seen CAC approved coins that didn’t make the grade. Check out the “To CAC or not to CAC” thread, and you will see coins that the majority of people who follow that thread thought that some of those coins fell short despite the CAC endorsement.

The trouble with CAC comes from the people who endorse it, not the CAC company. They are quite vociferous with their opinions and will attack anyone who does not agree with them.

All of this has turned me off to the U.S. coin market. I don’t buy expensive U.S. coins anymore because of this. I finised a little sub set of Civil War era cents last year. That will probably the last U.S. coins that I will buy, except for the current year's Proof set and maybe a new commemorative coin or two if it strikes my fancy.

 

I disagree. If CAC published the serial numbers of coins they rejected, the company would go bankrupt from the lawsuits it would face. PCGS and NGC would be at the front of line for those suits because it would put them and a lot of coin dealers out of business for no legitimate reason.

 

PCGS and NGC probably wouldn't care to much, it would be the owners of said coins and dealers that would be suing them all the time. They probably wouldn't win, but you don't have to to bankrupt a company or make it not worth the hassle

 

But what is CAC doing to the market by not releasing this information? I would say the owner of every coin without a CAC sticker on the slab has lost money versus what is would have been worth if there was not any CAC. Its ok for all collectors to lose money, but heaven forbid don't make a TPG or CAC lose any?

This is why such labeling is nefarious, planned or not. Consumers always react to this. This exact topic is the subject of my PhD dissertation I am writing right now. Whether they meant to or not, how CAC operates costs all collectors who have non-CAC slabs money due to consumer preference tendencies regarding such labeling. CAC labeling will generate extra money for those selling CAC slabs, but hobby money is not infinite, so definitionally non-CAC slab owners LOSE money. If you like I will give you 30 citations of major papers on the subject.

 

You have explained why I am out of the U.S. coin market. One man should not have power to dictate which coins can go into my collection.

 

So am I sir, so am I. I do get drawn into colonial paper at times, too much cool history in them for me to resist.

 

Nothing. The market makes it's own choices and it's really just high end expensive coins where the assumption is even made. No one is really looking at sub $200 dollar coins where probably 95-99% of collectors operate saying this must have been rejected not having a sticker.

Why? Reality is that many were going to go down as the internet came about and things became much more available. The non CAC coins aren't really depressed, the CAC coins are just boosted.

The only ones who really are getting hosed are the ones that were told or thought something was PQ/Premium whatever and paid a stiff price when it really wasn't. Not everyone needs to get the premium examples of the grade, they just need to be aware when they aren't and pay accordingly.

It makes sense for dealers to dislike CAC as it makes it harder for them to hype high priced coins, for collectors of such coins it is an asset just as the TPGs are

He doesn't, only you choose what goes into it or not.

 

Not true. It is a case of never knowing, but all research would say you are incorrect. Its so well documented as to not really be challenged that consumers will lower consumption/willingness to pay of something with adverse labeling, (in this case no CAC), while increase consumption of positive labeling, (CAC label). So, the fact the hobby bought into the bean is definitionally proving non-CAC coins lost money. Since it DID happen, there is no knowing how much. Maybe they were flat but WOULD HAVE gone up 5%, maybe its variable by series, by price point, etc. I have no idea, but basic consumer modeling proves that it DID HAPPEN.

Again, I do not know if planned this way or not. I do find it funny how CAC spends THOUSANDS of dollars running ads how CAC does not add value to a coin. Are they aware of this and trying to get ahead of collector opinion of what happened to their coin's value because of CAC?

 

Sure thing whatever you want to believe, this isn't a supermarket or department store question. It's not like the same thing of lower end (for the grade) and common coins taking value hits has happened with many coins as the internet expanded even with coins CAC doesn't review, oh wait it did.

Some of you guys just want to blame CAC for everything which ultimately makes no sense or difference. I get for some people it's just a personal grudge they can't let go, but give it a rest. Almost every CAC thread on multiple forums the same nonsense gets said over and over and over whenever someones even asks so much as a legitimate question.

CAC is here to stay, they're highly respected, have a highly skilled team, and no they did not ruin the market nor are they only successful because of market research about packaging

My fault for even trying in a CAC thread

 

They might even like it. People who have coins on the dreaded "Failed to CAC" list will crack them out and resubmit them to get them into slabs with serial numbers that aren't on the list. Then sell as "possibles". The reslabbing improves the coins marketability because it is no longer on the list and more submissions for the TPG's.

 

Wow, out of about 14 responses only one actually addressed my original question. Thanks @dddd.

I guess just mentioning CAC is like touching the third rail - lots of hidden electricity there.

 

That's good to know. If you won't read no reason to waste time trying to help anymore

 

You always wish to be dismissive and condescending to my thread on the issue, yet fail to actually address points I bring up. Always the same thing, TPGs and CAC are godsend, we should be thankful they take millions in hobby dollars every year, and without them the hobby would fail.

Many times I have asked you your background, yet you refuse to answer sir. You always vociferously defend all companies making profits from this hobby without actually selling coins. Do YOU make money in this industry? I think conflicts of interest help everyone interpret your posts. I have declared I am a collector only, never dealing, never working in the industry in any form, so I think I am representative of collectors. Who do YOU represent sir?

 

I thought I was addressing it sir in my first post, but apologize if you believe I did not. I believe C, they just go along with whatever logic the TPGs decide is best for their profitability that day and judge relative strength of grade.

 

If you want more answers, you can go ask the PCGS forum. They love the CAC topic