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Why Slabs are more popular in US than UK
To me, a simple answer. The US is a much larger country, physically.
The 'sight unseen' market has rewarded reliable and consistent third-party grading for taking much of the risk out of buying coins 'remotely'. That is, by mail, phone or internet, buying an NGC MS-64 Antietam Half Dollar carries a high degree of quality assurance, even without a physical visit. Now if the entire marketplace was geographically no larger than Michigan...a physical visit to the coin before purchase would make more sense than supporting a third-party grading service. Alan 'just my theory' |
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On Sun, 30 Jan 2005 21:16:12 -0500, Alan Williams
wrote: To me, a simple answer. The US is a much larger country, physically. The 'sight unseen' market has rewarded reliable and consistent third-party grading for taking much of the risk out of buying coins 'remotely'. That is, by mail, phone or internet, buying an NGC MS-64 Antietam Half Dollar carries a high degree of quality assurance, even without a physical visit. Now if the entire marketplace was geographically no larger than Michigan...a physical visit to the coin before purchase would make more sense than supporting a third-party grading service. Alan 'just my theory' I don't think it's the physical size, I think it's the size in money spent and marketing. More collectors vying for the same coins creating the minute grade splits worth $1000's creating the need for experts who can at least get a grade "right" 7 times out of 10. |
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"Alan Williams" wrote in message ... To me, a simple answer. The US is a much larger country, physically. The 'sight unseen' market has rewarded reliable and consistent third-party grading for taking much of the risk out of buying coins 'remotely'. That is, by mail, phone or internet, buying an NGC MS-64 Antietam Half Dollar carries a high degree of quality assurance, even without a physical visit. Now if the entire marketplace was geographically no larger than Michigan...a physical visit to the coin before purchase would make more sense than supporting a third-party grading service. Alan 'just my theory' Too simple - too neat. USA: Area - 9,629,091 sq km Australia: 7,686,850 sq km UK: 244,820 sq km We Aussies have also rejected slabbing out of hand. The only start-up slabbing company closed down (I *think* they're defunct. We certainly don't hear of them any more.) Maybe you need to put "population per unit area" into the equation. (We're still less than 20 million) I think its not down to a physical characteristic as much as an issue of collective personality. We Colonials share much of Mother England's traits - disdain for slabs is probably one of them. The USA is truly the land of commerce - of free enterprise. Slabs promote that ideal, at the expense of the aesthetics of the collector. We Commonwealthers are much more Traditionalist. Bugger the sale value! I want to feel the history of the coin through my fingertips. What!? A 300% price jump for one undetectable grade point increase? Don't be silly, old man! We left-pondians (and lower-pondians) are very different to youse 'Merkins. We both meekly and subserviently accepted the change from pounds/shilling/pence to decimal currency. Can you imagine such unanimous (almost) acceptance from the USofA on (just about) ANY issue of such gravitas? I can't. Try proposing that the US treasury abolish the cent and/or the dollar bill. Try discussing that proposal on this small-scale venue. Slabs (like the .45) are the great equalisers. Anyone can invest profitably in old coins, because the slab commodifies (izzat a word?) them. Aussies and Poms don't want that crass level of commercialisation - wheras Yanks by-and-large don't even notice that aspect of the trend. Enough generalisations and blanket statements. Whadd'ya reckon, huh? -- Jeff R. |
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On Mon, 31 Jan 2005 19:57:12 +1100, "Jeff R."
wrote: "Alan Williams" wrote in message ... To me, a simple answer. The US is a much larger country, physically. The 'sight unseen' market has rewarded reliable and consistent third-party grading for taking much of the risk out of buying coins 'remotely'. That is, by mail, phone or internet, buying an NGC MS-64 Antietam Half Dollar carries a high degree of quality assurance, even without a physical visit. Now if the entire marketplace was geographically no larger than Michigan...a physical visit to the coin before purchase would make more sense than supporting a third-party grading service. Alan 'just my theory' Too simple - too neat. USA: Area - 9,629,091 sq km Australia: 7,686,850 sq km UK: 244,820 sq km We Aussies have also rejected slabbing out of hand. The only start-up slabbing company closed down (I *think* they're defunct. We certainly don't hear of them any more.) Maybe you need to put "population per unit area" into the equation. (We're still less than 20 million) I think its not down to a physical characteristic as much as an issue of collective personality. We Colonials share much of Mother England's traits - disdain for slabs is probably one of them. The USA is truly the land of commerce - of free enterprise. Slabs promote that ideal, at the expense of the aesthetics of the collector. We Commonwealthers are much more Traditionalist. Bugger the sale value! I want to feel the history of the coin through my fingertips. What!? A 300% price jump for one undetectable grade point increase? Don't be silly, old man! We left-pondians (and lower-pondians) are very different to youse 'Merkins. We both meekly and subserviently accepted the change from pounds/shilling/pence to decimal currency. Can you imagine such unanimous (almost) acceptance from the USofA on (just about) ANY issue of such gravitas? I can't. Try proposing that the US treasury abolish the cent and/or the dollar bill. Try discussing that proposal on this small-scale venue. Slabs (like the .45) are the great equalisers. Anyone can invest profitably in old coins, because the slab commodifies (izzat a word?) them. Aussies and Poms don't want that crass level of commercialisation - wheras Yanks by-and-large don't even notice that aspect of the trend. Enough generalisations and blanket statements. Whadd'ya reckon, huh? Actually, I really liked your analogies. Those are the kind of generalizations and blanket statements that can make an American proud. Almost brought tears to my eyes :-) Ron |
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On Sun, 30 Jan 2005 21:16:12 -0500, Alan Williams
wrote: To me, a simple answer. The US is a much larger country, physically. The 'sight unseen' market has rewarded reliable and consistent third-party grading for taking much of the risk out of buying coins 'remotely'. The problem with this theory is Canada. Canada is also quite big, yet is apparently nowhere near as slab-crazy as the US is. I also have a nice simple hypothesis into the matter, and can be stated as thus: Slabs help perpetuate an absurd price/grade scheme. Of course, when you think about it, this is not too simple. The best explanation is that when (Sheldon) numerical graded got established, there was supposed to be a simple relationship between grade and price, a linear formulation where value = basal value * grade, where the basal value is the value of a basal state coin. This worked briefly for 1794 large cents, but quickly failed, both for rarity, condition census coins, and many other purposes. But the scheme, which correlated old word grades into numerical grades, had the best uncirculated coin worth 7/6ths the amount of the least best uncirculated coin, and thus occupied 60-70 in the scale. Sheldon originally used the grades 60, 65, and 70 for uncirculated. Of course, the grade of a coin falls along a continuum (more exactly, it's a multidimensional continuum based on many factors which complicates things so we'll ignore that for now), and, to a certain extent, we can imagine coins that fall somewhere between a 65 and a 70, or between a 60 and a 65. And thus was born 63 and 67. But we still have a continuum and so eventually we got 61, 62, 64, 66, 68, and 69 also. And some companies have used fractional grades also! But there's a big problem in all this. No one grades exactly alike. Let's take a look at the condition census of the 1793 S-1 large cent, in CQR (17th ed), Penny Prices (1st ed), and the Breen-Borkart encyclopedia: CQR: 63-60-55-50-45-45 (3 45's total) PP: 63-55-50-50-45-45 (4 45's total) BrB: 61-60-50-50-50-50 NGC: finest _seen_ is 62 (not necessarily equivalent to #1 on condition census, also not EAC standards) And as is obvious, they differ, even though all are using EAC standards. But this should not be a surprise. We all see coins differently, and, as we add finer and finer gradations to our continuum, where the coins go on that continuum becomes less and less precise. The crackout game is more evidence for this. Further, even the most reputable slabbing companies will quite often grade coins differently from one another, or even at different times with the same service. Now, to make money as a coin dealer, you must sell coins at a higher price than what you buy them at (at least on average). There are of course plenty of ethical ways of doing this, but also more than enough ways to stretch ethics or get rid of them entirely. And thus comes the practice of buying at one grade and selling at a higher one. So let's say you have a coin you want to buy from a dealer (we are still in the pre-slab/pre-ANACS era). Dealer says it's a 65 and offers it at a 65 price. You buy, and agree with the grade and price. A couple of years go buy, prices go up, and you want to sell, we'll say to the same dealer (in a different holder). Dealer says its a 64 and offers to buy at a 64 price, which is much much less than a 65 price. You can try to argue grade with him, but how much will that do? Do you really think you can reliably tell a 64 from a 65? So you don't sell, eventually selling to someone else. Many people go through the same thing. This gets everyone thinking, "hmm, if any 65 I buy can only be resold for 64 money which is much much less, why buy a 65 at the present price when I can wait for a collapse or buy an imperceptibly worse 64 at 10 times less cost and much less downside if that's downgraded at resale." Of course, if this were to come to past, it would not be good financially for dealers of high-grade material. So how to fool most of the people most of the time? Well, some big-shot dealers get together and decide to start grading and certifying said grades of coins. Now, instead of the dealer grading some coin, some of his friends now do it, either as a second job in some cases or else after having to quit dealing (but who says they can't become a dealer again upon stopping grading; nice little revolving door even with a dealer/grader "independence"). So now you can still buy that 65 at a 65 price which is much much higher than a 64 piece would bring. But of course the big-shot dealers can no longer buy at one grade and sell at a higher one, and a nice compromise. Or is it? The wholesale/retail split will increase with grade, so not all is lost for the dealer. And, with such an absurd grade/price scheme being perpetuated, it only needs to be taken one step further. It's already being claimed that small differences in grade bring large differences in price. So why not, even smaller differences? This, now, you can buy from a dealer a 65 that is "strong for a grade" and "essentially a 66" and "undergraded," according to the dealer at a price that is mere multiples of the guide price for a 65. Of course, when it's time to sell, suddenly that 65 is "weak for the grade," and only worth a small fraction of the 65 guide price. (Note: I do not in any way claim that all dealers are like this.) And the theory makes sense. What other country's numismatic market has such a grade/price scheme? snip ***** [1] Oh wait, I forgot this is a family newsgroup. Instead, let's say "the fluffy bunny family's wayward brother will help you get your foot in the door of his concrete and short dock company." -- Ed. Stoebenau a #143 |
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Any new collector reading Ed's post should print it out and read it each
time they are considering buying a high MS coin at silly money. Anyone that has already been sucked into the myth that coins can be graded with a microscope and that high MS coins are worth multiples of the alleged lesser coins have too much to loose if they don't defend the current grading system in the USA, so don't expect a change of attitude any time soon. Billy "Ed. Stoebenau" wrote: On Sun, 30 Jan 2005 21:16:12 -0500, Alan Williams wrote: To me, a simple answer. The US is a much larger country, physically. The 'sight unseen' market has rewarded reliable and consistent third-party grading for taking much of the risk out of buying coins 'remotely'. The problem with this theory is Canada. Canada is also quite big, yet is apparently nowhere near as slab-crazy as the US is. I also have a nice simple hypothesis into the matter, and can be stated as thus: Slabs help perpetuate an absurd price/grade scheme. Of course, when you think about it, this is not too simple. The best explanation is that when (Sheldon) numerical graded got established, there was supposed to be a simple relationship between grade and price, a linear formulation where value = basal value * grade, where the basal value is the value of a basal state coin. This worked briefly for 1794 large cents, but quickly failed, both for rarity, condition census coins, and many other purposes. But the scheme, which correlated old word grades into numerical grades, had the best uncirculated coin worth 7/6ths the amount of the least best uncirculated coin, and thus occupied 60-70 in the scale. Sheldon originally used the grades 60, 65, and 70 for uncirculated. Of course, the grade of a coin falls along a continuum (more exactly, it's a multidimensional continuum based on many factors which complicates things so we'll ignore that for now), and, to a certain extent, we can imagine coins that fall somewhere between a 65 and a 70, or between a 60 and a 65. And thus was born 63 and 67. But we still have a continuum and so eventually we got 61, 62, 64, 66, 68, and 69 also. And some companies have used fractional grades also! But there's a big problem in all this. No one grades exactly alike. Let's take a look at the condition census of the 1793 S-1 large cent, in CQR (17th ed), Penny Prices (1st ed), and the Breen-Borkart encyclopedia: CQR: 63-60-55-50-45-45 (3 45's total) PP: 63-55-50-50-45-45 (4 45's total) BrB: 61-60-50-50-50-50 NGC: finest _seen_ is 62 (not necessarily equivalent to #1 on condition census, also not EAC standards) And as is obvious, they differ, even though all are using EAC standards. But this should not be a surprise. We all see coins differently, and, as we add finer and finer gradations to our continuum, where the coins go on that continuum becomes less and less precise. The crackout game is more evidence for this. Further, even the most reputable slabbing companies will quite often grade coins differently from one another, or even at different times with the same service. Now, to make money as a coin dealer, you must sell coins at a higher price than what you buy them at (at least on average). There are of course plenty of ethical ways of doing this, but also more than enough ways to stretch ethics or get rid of them entirely. And thus comes the practice of buying at one grade and selling at a higher one. So let's say you have a coin you want to buy from a dealer (we are still in the pre-slab/pre-ANACS era). Dealer says it's a 65 and offers it at a 65 price. You buy, and agree with the grade and price. A couple of years go buy, prices go up, and you want to sell, we'll say to the same dealer (in a different holder). Dealer says its a 64 and offers to buy at a 64 price, which is much much less than a 65 price. You can try to argue grade with him, but how much will that do? Do you really think you can reliably tell a 64 from a 65? So you don't sell, eventually selling to someone else. Many people go through the same thing. This gets everyone thinking, "hmm, if any 65 I buy can only be resold for 64 money which is much much less, why buy a 65 at the present price when I can wait for a collapse or buy an imperceptibly worse 64 at 10 times less cost and much less downside if that's downgraded at resale." Of course, if this were to come to past, it would not be good financially for dealers of high-grade material. So how to fool most of the people most of the time? Well, some big-shot dealers get together and decide to start grading and certifying said grades of coins. Now, instead of the dealer grading some coin, some of his friends now do it, either as a second job in some cases or else after having to quit dealing (but who says they can't become a dealer again upon stopping grading; nice little revolving door even with a dealer/grader "independence"). So now you can still buy that 65 at a 65 price which is much much higher than a 64 piece would bring. But of course the big-shot dealers can no longer buy at one grade and sell at a higher one, and a nice compromise. Or is it? The wholesale/retail split will increase with grade, so not all is lost for the dealer. And, with such an absurd grade/price scheme being perpetuated, it only needs to be taken one step further. It's already being claimed that small differences in grade bring large differences in price. So why not, even smaller differences? This, now, you can buy from a dealer a 65 that is "strong for a grade" and "essentially a 66" and "undergraded," according to the dealer at a price that is mere multiples of the guide price for a 65. Of course, when it's time to sell, suddenly that 65 is "weak for the grade," and only worth a small fraction of the 65 guide price. (Note: I do not in any way claim that all dealers are like this.) And the theory makes sense. What other country's numismatic market has such a grade/price scheme? snip ***** [1] Oh wait, I forgot this is a family newsgroup. Instead, let's say "the fluffy bunny family's wayward brother will help you get your foot in the door of his concrete and short dock company." -- Ed. Stoebenau a #143 |
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On Wed, 02 Feb 2005 23:45:15 -0600, Ed. Stoebenau
wrote: I also have a nice simple hypothesis into the matter, and can be stated as thus: Slabs help perpetuate an absurd price/grade scheme. snip Excellent summary, Ed. There's also technical grading vs. 'market grading', which leaves lots of room for hijinks. To be fair, though, it's capitalism... grading services and dealers couldn't exist without their customers who demand their 'products'. Those customers who obsess over condition, however, tend to be more 'object fetishist' than numismatist, in my experience. Others are into coins only as speculation ('investment'), and don't even care to look at a coin, as long as the market accepts that the grade is reliable, and high. Both have little to do with numismatics. Chuck http://tinyurl.com/45hrw |
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I cringe when I see those auctions for MS or PR70's. Not that I
wouldn't mind a set of them but I have kids to feed,,,,, I have a few examples of PR70's but only from my own submissions. Don't even plan on selling them, just part of my hoard,, lol. I'll let my kids worry about it someday. Ron On Thu, 03 Feb 2005 12:03:28 GMT, "note.boy" wrote: Any new collector reading Ed's post should print it out and read it each time they are considering buying a high MS coin at silly money. Anyone that has already been sucked into the myth that coins can be graded with a microscope and that high MS coins are worth multiples of the alleged lesser coins have too much to loose if they don't defend the current grading system in the USA, so don't expect a change of attitude any time soon. Billy "Ed. Stoebenau" wrote: On Sun, 30 Jan 2005 21:16:12 -0500, Alan Williams wrote: To me, a simple answer. The US is a much larger country, physically. The 'sight unseen' market has rewarded reliable and consistent third-party grading for taking much of the risk out of buying coins 'remotely'. The problem with this theory is Canada. Canada is also quite big, yet is apparently nowhere near as slab-crazy as the US is. I also have a nice simple hypothesis into the matter, and can be stated as thus: Slabs help perpetuate an absurd price/grade scheme. Of course, when you think about it, this is not too simple. The best explanation is that when (Sheldon) numerical graded got established, there was supposed to be a simple relationship between grade and price, a linear formulation where value = basal value * grade, where the basal value is the value of a basal state coin. This worked briefly for 1794 large cents, but quickly failed, both for rarity, condition census coins, and many other purposes. But the scheme, which correlated old word grades into numerical grades, had the best uncirculated coin worth 7/6ths the amount of the least best uncirculated coin, and thus occupied 60-70 in the scale. Sheldon originally used the grades 60, 65, and 70 for uncirculated. Of course, the grade of a coin falls along a continuum (more exactly, it's a multidimensional continuum based on many factors which complicates things so we'll ignore that for now), and, to a certain extent, we can imagine coins that fall somewhere between a 65 and a 70, or between a 60 and a 65. And thus was born 63 and 67. But we still have a continuum and so eventually we got 61, 62, 64, 66, 68, and 69 also. And some companies have used fractional grades also! But there's a big problem in all this. No one grades exactly alike. Let's take a look at the condition census of the 1793 S-1 large cent, in CQR (17th ed), Penny Prices (1st ed), and the Breen-Borkart encyclopedia: CQR: 63-60-55-50-45-45 (3 45's total) PP: 63-55-50-50-45-45 (4 45's total) BrB: 61-60-50-50-50-50 NGC: finest _seen_ is 62 (not necessarily equivalent to #1 on condition census, also not EAC standards) And as is obvious, they differ, even though all are using EAC standards. But this should not be a surprise. We all see coins differently, and, as we add finer and finer gradations to our continuum, where the coins go on that continuum becomes less and less precise. The crackout game is more evidence for this. Further, even the most reputable slabbing companies will quite often grade coins differently from one another, or even at different times with the same service. Now, to make money as a coin dealer, you must sell coins at a higher price than what you buy them at (at least on average). There are of course plenty of ethical ways of doing this, but also more than enough ways to stretch ethics or get rid of them entirely. And thus comes the practice of buying at one grade and selling at a higher one. So let's say you have a coin you want to buy from a dealer (we are still in the pre-slab/pre-ANACS era). Dealer says it's a 65 and offers it at a 65 price. You buy, and agree with the grade and price. A couple of years go buy, prices go up, and you want to sell, we'll say to the same dealer (in a different holder). Dealer says its a 64 and offers to buy at a 64 price, which is much much less than a 65 price. You can try to argue grade with him, but how much will that do? Do you really think you can reliably tell a 64 from a 65? So you don't sell, eventually selling to someone else. Many people go through the same thing. This gets everyone thinking, "hmm, if any 65 I buy can only be resold for 64 money which is much much less, why buy a 65 at the present price when I can wait for a collapse or buy an imperceptibly worse 64 at 10 times less cost and much less downside if that's downgraded at resale." Of course, if this were to come to past, it would not be good financially for dealers of high-grade material. So how to fool most of the people most of the time? Well, some big-shot dealers get together and decide to start grading and certifying said grades of coins. Now, instead of the dealer grading some coin, some of his friends now do it, either as a second job in some cases or else after having to quit dealing (but who says they can't become a dealer again upon stopping grading; nice little revolving door even with a dealer/grader "independence"). So now you can still buy that 65 at a 65 price which is much much higher than a 64 piece would bring. But of course the big-shot dealers can no longer buy at one grade and sell at a higher one, and a nice compromise. Or is it? The wholesale/retail split will increase with grade, so not all is lost for the dealer. And, with such an absurd grade/price scheme being perpetuated, it only needs to be taken one step further. It's already being claimed that small differences in grade bring large differences in price. So why not, even smaller differences? This, now, you can buy from a dealer a 65 that is "strong for a grade" and "essentially a 66" and "undergraded," according to the dealer at a price that is mere multiples of the guide price for a 65. Of course, when it's time to sell, suddenly that 65 is "weak for the grade," and only worth a small fraction of the 65 guide price. (Note: I do not in any way claim that all dealers are like this.) And the theory makes sense. What other country's numismatic market has such a grade/price scheme? snip ***** [1] Oh wait, I forgot this is a family newsgroup. Instead, let's say "the fluffy bunny family's wayward brother will help you get your foot in the door of his concrete and short dock company." -- Ed. Stoebenau a #143 |
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