Will raw coins become less or more popular this year?

Last year it became common knowledge among collectors that a coin
"certified" by grading service B is worth less than the same coin
"certified" by service A, even though both have the same numerical
grade and no problems noted. The PNG survey, the ANA Accugrade/Barry
Stuppler hearing, and Coin World's submission of the same small group
of coins to several grading services were all discussed at length here
and on other online forums.

Since all the dealers tell us that the collector coins are still in a
bull market ("white hot" or "nuclear" are the adjectives sometimes
used by the largest promoters), I wonder how long it will be before
grading tightens up again. I remember the mid-to-late '80s when it
took a coin purchased as an MS-65 to bring current MS-65 Graysheet
bids at the new higher prices. Certain graders' MS-65s wouldn't bring
Graysheet bid either, and MS-64 (the "borderline Gem" grade was born).

My question tonight is not as complicated as asking for predictions on
how grading standards will change in 2004, but simply whether slabbed
coins will increase or decrease in popularity this year.

I will ask this same question on rec.collecting.coins and the PCGS
U.S. Coins Forum, and expect a few interesting responses with a fair
amount of disagreement. I suspect that r.c.c. posters will sing the
virtues of buying raw coins and learning how to grade while PCGS
posters (with a greater percentage of dealers and high income
collectors) will recommend slabbed coins.

I enjoy collecting sets of better grade circulated U.S. coins which
are not common enough or expensive enough to be promoted and sold in
volume by those touting coins as an investment. My budget keeps me
shopping for $20 to $200 coins, and about once a year treating myself
to a $400 to $500 coin. Most of my collection is frankly not worth
the slabbing fees of the respectable grading services, and I am
finally comfortable grading the coins in the types I buy most often.

I expect to hear someone say that higher prices and dramatic price
jumps between coins in one grade and the next level down make it
imperative to purchase coins certified by the one, two, or perhaps
three most respected grading services. (Look at a 1901 or 1884-S
Morgan Dollar's value as the grade exceeds XF, for example.) A few
years ago, when we spent less time grading the graders, bottom feeder
grading services did quite well calling an AU-55 coin MS-61 so a
dealer could qute MS-60 and 63 retail prices and peddle the slab to an
unsuspecting newbie looking for a bargain slabbed in an aura of
respectability.
Raw coins, according to the promoters of the top couple of grading
services, will still remain the objects of misrepresentation, since
the seller can claim that grading is subjective once the
bargain-hunter is told by several informed buyers who either quote a
small fraction of the purchase price or refuse to buy the coin for
reasons insulting to the bargain hunter. The slab camp will say that
raw coins will appeal only to fraudulent dealers and cheapskate
collectors.

I will try to play devil's advocate and will note that by best coin
purchases in the last two years have been raw coins. When so much
attention is paid to the likes of uncirculated CC Morgans, proof
Franklins, and high grade late-date MS Walkers, it becomes next to
impossible to rip one of these. My greatest enjoyment in coin
collecting recently has been in finding a fellow collector or a dealer
who makes no bets on how a coin might slab at one of the grading
services and just lets me examine the coin and agrees to sell it at
the going price for a grade upon which we both agree. Once in a blue
moon (although I don't endorse that eBay seller) I can eben find a
coin I need from a seller whose reputation preceds him. (Last year I
even found a key date Barber Dime in an Axxugrade VG slab which is
actually a solid Fine and is now a raw coin in one of my Dansco
albums!) More often, I find better grade raw common dates and
semi-keys in less-than-popular series at bargain prices since the
dealers and serious collectors are spending too much time playing
crackout and registry set games or concentrating on the dates which
most collectors need.

Raw coins will be more appealing to me this year than slabbed coins.
I will buy a few more slabbed coins, especially if I venture into new
areas of collecting. I will continue to enjoy reading about grading
the graders, but will enjoy slowly increasing my own grading
abilities. It looks like a good year for raw coins for me. What say
you?

Fundamentally, the commodity being traded in a slab is the graders' "skills"
(read: consistency). A purchased grading opinion is an economic substitute
for the coin purchaser's grading skills. The premiums paid for slabbed coins
increase as slabbers' grading consistency increases and/or as purchasers'
(collective) skills decrease. (This premium is distorted, but not
eliminated, by coin buyers who ignore slabbers' opinions and grade coins in
slabs as if they were raw, and by the market's interpretion of any given
slabber's consistency.) Thus, your question asks our expectations of the
relative changes in slabbers' consistency vs. coin purchasers' graders'
skills. My gut feeling is that slabbers' consistency will improve over time;
who knows how individual collectors' skills will change (up or down).

That said, the question is imponderable. It's near-impossible to get an
apples-to-apples comparison of raw vs. slabbed coin prices. In order to
measure such premiums, you'd have to know that the two categories (slabbed
vs. raw) are graded the same. Even if you could sell the identical coin (or
group of coins) twice, once in a slab, and the other time raw, you couldn't
distinguish which part of any price differential was due to the grading vs.
other factors (such as timing of the sale, description, etc.).

--Chris

"Paul Robertz" wrote in message
om...
Last year it became common knowledge among collectors that a coin
"certified" by grading service B is worth less than the same coin
"certified" by service A, even though both have the same numerical
grade and no problems noted. The PNG survey, the ANA Accugrade/Barry
Stuppler hearing, and Coin World's submission of the same small group
of coins to several grading services were all discussed at length here
and on other online forums.

Since all the dealers tell us that the collector coins are still in a
bull market ("white hot" or "nuclear" are the adjectives sometimes
used by the largest promoters), I wonder how long it will be before
grading tightens up again. I remember the mid-to-late '80s when it
took a coin purchased as an MS-65 to bring current MS-65 Graysheet
bids at the new higher prices. Certain graders' MS-65s wouldn't bring
Graysheet bid either, and MS-64 (the "borderline Gem" grade was born).

My question tonight is not as complicated as asking for predictions on
how grading standards will change in 2004, but simply whether slabbed
coins will increase or decrease in popularity this year.

I will ask this same question on rec.collecting.coins and the PCGS
U.S. Coins Forum, and expect a few interesting responses with a fair
amount of disagreement. I suspect that r.c.c. posters will sing the
virtues of buying raw coins and learning how to grade while PCGS
posters (with a greater percentage of dealers and high income
collectors) will recommend slabbed coins.

I enjoy collecting sets of better grade circulated U.S. coins which
are not common enough or expensive enough to be promoted and sold in
volume by those touting coins as an investment. My budget keeps me
shopping for $20 to $200 coins, and about once a year treating myself
to a $400 to $500 coin. Most of my collection is frankly not worth
the slabbing fees of the respectable grading services, and I am
finally comfortable grading the coins in the types I buy most often.

I expect to hear someone say that higher prices and dramatic price
jumps between coins in one grade and the next level down make it
imperative to purchase coins certified by the one, two, or perhaps
three most respected grading services. (Look at a 1901 or 1884-S
Morgan Dollar's value as the grade exceeds XF, for example.) A few
years ago, when we spent less time grading the graders, bottom feeder
grading services did quite well calling an AU-55 coin MS-61 so a
dealer could qute MS-60 and 63 retail prices and peddle the slab to an
unsuspecting newbie looking for a bargain slabbed in an aura of
respectability.
Raw coins, according to the promoters of the top couple of grading
services, will still remain the objects of misrepresentation, since
the seller can claim that grading is subjective once the
bargain-hunter is told by several informed buyers who either quote a
small fraction of the purchase price or refuse to buy the coin for
reasons insulting to the bargain hunter. The slab camp will say that
raw coins will appeal only to fraudulent dealers and cheapskate
collectors.

I will try to play devil's advocate and will note that by best coin
purchases in the last two years have been raw coins. When so much
attention is paid to the likes of uncirculated CC Morgans, proof
Franklins, and high grade late-date MS Walkers, it becomes next to
impossible to rip one of these. My greatest enjoyment in coin
collecting recently has been in finding a fellow collector or a dealer
who makes no bets on how a coin might slab at one of the grading
services and just lets me examine the coin and agrees to sell it at
the going price for a grade upon which we both agree. Once in a blue
moon (although I don't endorse that eBay seller) I can eben find a
coin I need from a seller whose reputation preceds him. (Last year I
even found a key date Barber Dime in an Axxugrade VG slab which is
actually a solid Fine and is now a raw coin in one of my Dansco
albums!) More often, I find better grade raw common dates and
semi-keys in less-than-popular series at bargain prices since the
dealers and serious collectors are spending too much time playing
crackout and registry set games or concentrating on the dates which
most collectors need.

Raw coins will be more appealing to me this year than slabbed coins.
I will buy a few more slabbed coins, especially if I venture into new
areas of collecting. I will continue to enjoy reading about grading
the graders, but will enjoy slowly increasing my own grading
abilities. It looks like a good year for raw coins for me. What say
you?




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"Chris S" chris(at)imt.xohost.com wrote in message
...
Fundamentally, the commodity being traded in a slab is the graders'
"skills"
(read: consistency).

Just to pick a nit :-)

I would say "the commodity being traded in a slab is the graders' "skills""
(read accuracy)


Now to answer the question with my opinion:
Slabbed coins will continue to be popular
and probably increase in popularity for many coins.

I don't think that an increase in popularity of slabbed coins equates
directly to
a decrease in the popularity of raw coins so I think raw coins will stay
about the same.
That is, raw coins in 2004 will be by far the majority of coins bought sold
and traded :-)

Dale
Don't care for slabbed coins but they have their place.

"Paul Robertz" wrote in message
om...
Last year it became common knowledge among collectors that a coin
"certified" by grading service B is worth less than the same coin
"certified" by service A, even though both have the same numerical
grade and no problems noted. The PNG survey, the ANA Accugrade/Barry
Stuppler hearing, and Coin World's submission of the same small group
of coins to several grading services were all discussed at length here
and on other online forums.

I am not sure you are correct in this statement. It appears to me that the
market believes certain grading services overgrade their coins, thus the
same coin would have a higher grade at some grading companies, but would be
worth less than a coin with the same indicated grade on the slab.



Since all the dealers tell us that the collector coins are still in a
bull market ("white hot" or "nuclear" are the adjectives sometimes
used by the largest promoters), I wonder how long it will be before
grading tightens up again. I remember the mid-to-late '80s when it
took a coin purchased as an MS-65 to bring current MS-65 Graysheet
bids at the new higher prices. Certain graders' MS-65s wouldn't bring
Graysheet bid either, and MS-64 (the "borderline Gem" grade was born).


I can remember whan any MS morgan in a slab was worth $100 too. things
change. grading standards have fluctuated a lot, and will probably
fluctuate some more over time.


My question tonight is not as complicated as asking for predictions on
how grading standards will change in 2004, but simply whether slabbed
coins will increase or decrease in popularity this year.


Its clear that they are very popular, and I think that trend will continue.
just a guess, since I have no credentials as a prophet.

I will ask this same question on rec.collecting.coins and the PCGS
U.S. Coins Forum, and expect a few interesting responses with a fair
amount of disagreement. I suspect that r.c.c. posters will sing the
virtues of buying raw coins and learning how to grade while PCGS
posters (with a greater percentage of dealers and high income
collectors) will recommend slabbed coins.

I enjoy collecting sets of better grade circulated U.S. coins which
are not common enough or expensive enough to be promoted and sold in
volume by those touting coins as an investment. My budget keeps me
shopping for $20 to $200 coins, and about once a year treating myself
to a $400 to $500 coin. Most of my collection is frankly not worth
the slabbing fees of the respectable grading services, and I am
finally comfortable grading the coins in the types I buy most often.

I expect to hear someone say that higher prices and dramatic price
jumps between coins in one grade and the next level down make it
imperative to purchase coins certified by the one, two, or perhaps
three most respected grading services. (Look at a 1901 or 1884-S
Morgan Dollar's value as the grade exceeds XF, for example.) A few
years ago, when we spent less time grading the graders, bottom feeder
grading services did quite well calling an AU-55 coin MS-61 so a
dealer could qute MS-60 and 63 retail prices and peddle the slab to an
unsuspecting newbie looking for a bargain slabbed in an aura of
respectability.
Raw coins, according to the promoters of the top couple of grading
services, will still remain the objects of misrepresentation, since
the seller can claim that grading is subjective once the
bargain-hunter is told by several informed buyers who either quote a
small fraction of the purchase price or refuse to buy the coin for
reasons insulting to the bargain hunter. The slab camp will say that
raw coins will appeal only to fraudulent dealers and cheapskate
collectors.

I will try to play devil's advocate and will note that by best coin
purchases in the last two years have been raw coins. When so much
attention is paid to the likes of uncirculated CC Morgans, proof
Franklins, and high grade late-date MS Walkers, it becomes next to
impossible to rip one of these. My greatest enjoyment in coin
collecting recently has been in finding a fellow collector or a dealer
who makes no bets on how a coin might slab at one of the grading
services and just lets me examine the coin and agrees to sell it at
the going price for a grade upon which we both agree. Once in a blue
moon (although I don't endorse that eBay seller) I can eben find a
coin I need from a seller whose reputation preceds him. (Last year I
even found a key date Barber Dime in an Axxugrade VG slab which is
actually a solid Fine and is now a raw coin in one of my Dansco
albums!) More often, I find better grade raw common dates and
semi-keys in less-than-popular series at bargain prices since the
dealers and serious collectors are spending too much time playing
crackout and registry set games or concentrating on the dates which
most collectors need.

Raw coins will be more appealing to me this year than slabbed coins.
I will buy a few more slabbed coins, especially if I venture into new
areas of collecting. I will continue to enjoy reading about grading
the graders, but will enjoy slowly increasing my own grading
abilities. It looks like a good year for raw coins for me. What say
you?

"Dale Hallmark" wrote:
"Chris S" chris(at)imt.xohost.com wrote in message
...
Fundamentally, the commodity being traded in a slab is the graders'
"skills"
(read: consistency).

Just to pick a nit :-)

I would say "the commodity being traded in a slab is the graders'
"skills""
(read accuracy)

I hear where you're coming from. At the beginning the r.c.c. "Slabbing Wars"
about a year ago, I thought in terms of accuracy, too. I have since focused
on consistency application of any standard, rather than accuracy (which I
take to mean consistently hitting a unified grading standard). I figure that
of the two things I'd like to be consistent (standards and graders'
application of those standards), the slabbers only control the latter.
Besides, I consider application of the standards to be more important: Even
with each grading company defining its own standards, high consistency would
allow the market to translate among the standards; while cumbersome, a
useful comparison could be drawn. But even if all slabbers used identical
standards, useful comparison would be impossible if you couldn't trust them
to apply those standards consistently.

It would be great for collectors to have both uniform standards and
consistent grading within those standards, but I see little pressure on the
slabbers to unify their standards, so I've given up hope. Frankly, if I were
a slabber, I wouldn't either--my product would be more a commodity, and
competition would increase. Dissimilar grading standards among slabbers are
called "barriers to entry" in business lingo, and they work.

Now to answer the question with my opinion:
Slabbed coins will continue to be popular
and probably increase in popularity for many coins.

A factor that supports this conclusion is the decreasing cost to slab as a
percentage of coin value. If the coin market stays strong (prices go up) and
slabbing fees stay the same, slabbing's popularity should increase.
Ironically, even the slabbers who go to The Dark Side provide indirect value
to the market in the sense that they frequently charge low fees; their
tactics makes it harder for first- and second-tier slabbers to raise prices,
even though the third-tier slabbers' opinions are worth less than theirs.

--Chris




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