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Sick of Dealers and Coins



 
 
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  #1  
Old August 26th 03, 04:15 PM
Phil Barnhart
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Default Sick of Dealers and Coins

This summer, a good friend and ethics professor at a prominent law
school invited me up for a weekend. During this visit he commented
that it had been quite awhile since I had mentioned coins to him. I
had been an avid collector. I told him the truth.

"I am sick of dishonest, unethical and greedy people. So I have sold
almost all my coins and am leaving the hobby. It is just too hard on
the psyche"

After a great deal of debate, I made an offer to him. The ANA
convention would be in Baltimore in a few weeks and I offered to prove
to him that finding an honest dealer was harder in the convention
floor than in any court. The bet was on.

We met up at the convention, and I explained what we had to do. I had
two coins, slabbed by well-known services, that we would remove from
the slabs and try to sell. Each would be in an Eagle holder. Our
story was that these were my father's coins, and he was now in a home
and needed some money. One would be an 1892-O Half Eagle graded AU-55
(value between $1500-$2000). The second would be an 1916 Standing Lib
graded AU-58 (value between $4500-$5100).

Over six hours we approached 40 dealers (one of which posts here on
occasion - do you remember us?). We were lied to (10 dealers pointed
to the price of an 1892 Half Eagle on their grey sheet instead of the
New Orleans coin). 6 dealers gave us prices for the 1917 Standing
lib. What did the others do?

Almost every one asked us how much we wanted. One dealer even had
similarly grade 1916 in his case - he purposely laid several papers
over that area of the case while we chatted.

Almost every dealer undergraded these coins considerably. They used
the terms "very good" and "fine." At least 8 dealers said that they
had been cleaned. Here are the lowest and highest offers:

1892-O Half Eagle
Low offer: $250
Median offer: $650
High offer: $875

1916 Standing Lib
Low offer: $50 (offered 3 times)
Median offer: $550
High offer: $1300

Many of these dealers were good ANA members, respected, and heavy Coin
World advertisers. Not a single one of them were ethical. One
well-known dealer eyed the Standing lib for several minutes, declared
it an "extra-fine" and offered me $900.

"Are you positive about the grade?"

"Oh, yes. I've dealt with thousands of coins over the years. My
standards are very strict."

"What about grading companies?" Many of his coins were slabbed.

"They can be all over the map, but usually my grade matches theirs.
Slabbing a coin is expensive, though."

"So this coin is extra-fine, and you can give me $900 right now? How
about $1100?"

He pretends to think about it a bit. "I think I know someone who
might take this. MMmmmmmmmmmm. Okay."

"What if I told you I know this coin is actually AU, was purchased
from B&M five years ago, and is worth over 4 grand?"

If looks would kill, I'd be dead. "Everyone is entitled to their
opinion. A coin is only worth what someone else is willing to pay for
it." He had a few other choice words then had to call someone on his
cell. This dealer was the only one we confronted.

My good friend, the law profession, paid for drinks that night - and
looked ill about our day. He agreed with me - in ANY other field what
these dealers attempted would be unethical; in many cases even
criminal fraud. One man's "caveat emptor" is another man's thievery.
And I am sick of the lot of them. I just can't stand being around an
entire crowd of people all trying to rip each other off. And
certainly not any "fun." I've switched to wine tasting.

For the record, I sent the coins back through the slabbing process -
the standing lib came even back MS-63. Lol! I sold both of them -
this time letting the dealer in LA know I knew what the coins were
actually worth. The final price:

1916 Standing Lib: $5300
1892-O Half Eagle: $1600

Oh, and why did I take such a low price on the standing lib? I was
actually offered more. Because I think the grading service messed up;
in my own eyes it is a great AU, not a poor UNC. And ethically, I
could not take more. I wonder if this dealer will discount the coin
against the grade when he sells it . . .
Ads
  #2  
Old August 26th 03, 04:52 PM
Ira Stein
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Posts: n/a
Default

Phil Barnhart wrote:

This summer, a good friend and ethics professor at a prominent law
school invited me up for a weekend. During this visit he commented
that it had been quite awhile since I had mentioned coins to him. I
had been an avid collector. I told him the truth.

"I am sick of dishonest, unethical and greedy people. So I have sold
almost all my coins and am leaving the hobby. It is just too hard on
the psyche"

After a great deal of debate, I made an offer to him. The ANA
convention would be in Baltimore in a few weeks and I offered to prove
to him that finding an honest dealer was harder in the convention
floor than in any court. The bet was on.

We met up at the convention, and I explained what we had to do. I had
two coins, slabbed by well-known services, that we would remove from
the slabs and try to sell. Each would be in an Eagle holder. Our
story was that these were my father's coins, and he was now in a home
and needed some money. One would be an 1892-O Half Eagle graded AU-55
(value between $1500-$2000). The second would be an 1916 Standing Lib
graded AU-58 (value between $4500-$5100).

Over six hours we approached 40 dealers (one of which posts here on
occasion - do you remember us?). We were lied to (10 dealers pointed
to the price of an 1892 Half Eagle on their grey sheet instead of the
New Orleans coin). 6 dealers gave us prices for the 1917 Standing
lib. What did the others do?

Almost every one asked us how much we wanted. One dealer even had
similarly grade 1916 in his case - he purposely laid several papers
over that area of the case while we chatted.

Almost every dealer undergraded these coins considerably. They used
the terms "very good" and "fine." At least 8 dealers said that they
had been cleaned. Here are the lowest and highest offers:

1892-O Half Eagle
Low offer: $250
Median offer: $650
High offer: $875

1916 Standing Lib
Low offer: $50 (offered 3 times)
Median offer: $550
High offer: $1300

Many of these dealers were good ANA members, respected, and heavy Coin
World advertisers. Not a single one of them were ethical. One
well-known dealer eyed the Standing lib for several minutes, declared
it an "extra-fine" and offered me $900.

"Are you positive about the grade?"

"Oh, yes. I've dealt with thousands of coins over the years. My
standards are very strict."

"What about grading companies?" Many of his coins were slabbed.

"They can be all over the map, but usually my grade matches theirs.
Slabbing a coin is expensive, though."

"So this coin is extra-fine, and you can give me $900 right now? How
about $1100?"

He pretends to think about it a bit. "I think I know someone who
might take this. MMmmmmmmmmmm. Okay."

"What if I told you I know this coin is actually AU, was purchased
from B&M five years ago, and is worth over 4 grand?"

If looks would kill, I'd be dead. "Everyone is entitled to their
opinion. A coin is only worth what someone else is willing to pay for
it." He had a few other choice words then had to call someone on his
cell. This dealer was the only one we confronted.

My good friend, the law profession, paid for drinks that night - and
looked ill about our day. He agreed with me - in ANY other field what
these dealers attempted would be unethical; in many cases even
criminal fraud. One man's "caveat emptor" is another man's thievery.
And I am sick of the lot of them. I just can't stand being around an
entire crowd of people all trying to rip each other off. And
certainly not any "fun." I've switched to wine tasting.

For the record, I sent the coins back through the slabbing process -
the standing lib came even back MS-63. Lol! I sold both of them -
this time letting the dealer in LA know I knew what the coins were
actually worth. The final price:

1916 Standing Lib: $5300
1892-O Half Eagle: $1600

Oh, and why did I take such a low price on the standing lib? I was
actually offered more. Because I think the grading service messed up;
in my own eyes it is a great AU, not a poor UNC. And ethically, I
could not take more. I wonder if this dealer will discount the coin
against the grade when he sells it . . .



I find your story hard, no, impossible to believe.

The 1916 Standing Liberty Quarter was in incredible demand at the Balto ANA,
and at large shows, the dealer knows you'll shop it around and generally will
offer you strong dollars for a desirable coin.

In a slab by one of the two top grading companies, you'll generally receive
considerably more $$ than trying to sell such coins raw as anyone in the
business knows and anti-slabbers refuse to recognize. Many dealers are
uncertain as to what final grade a slabbing company will put on a raw coin and
will protect themselves by offering on the low side of wholesale value,
estimating worst possible case from the grading companies.

As far as the gold coin, many deceptive counterfeits abound, and even if the
coin is genuine, it may have been lightly cleaned and this occurence may not be
clearly noticable on the bourse floor.

Even if a small portion of your scenario is true, I believe we have all learned
that with quality coins it PAYS to get them certified. A far as your opinion
that the so-called AU standing Lib was an AU and not an unc, and then selling
at less than the going price for an AU in a reputable PCGS or NGC holder
stretches the limits of credulity. 2 months ago I sold an NGC graded 1916 AU-53
Standing Lib to dealer JH Cline for $7100 and he sold it fo $7800. It did NOT
have a full Head and was not so designated.

End of story.


Ira Stein
  #3  
Old August 26th 03, 08:44 PM
Bruce Hickmott
external usenet poster
 
Posts: n/a
Default

On 26 Aug 2003 08:15:44 -0700, (Phil Barnhart) is alleged to
have written:

We met up at the convention, and I explained what we had to do. I had
two coins, slabbed by well-known services, that we would remove from
the slabs and try to sell. Each would be in an Eagle holder. Our
story was that these were my father's coins, and he was now in a home
and needed some money. One would be an 1892-O Half Eagle graded AU-55
(value between $1500-$2000). The second would be an 1916 Standing Lib
graded AU-58 (value between $4500-$5100).


Which services graded which coins?


Over six hours we approached 40 dealers (one of which posts here on
occasion - do you remember us?). We were lied to (10 dealers pointed
to the price of an 1892 Half Eagle on their grey sheet instead of the
New Orleans coin). 6 dealers gave us prices for the 1917 Standing
lib. What did the others do?


Which dealers said what?


Many of these dealers were good ANA members, respected, and heavy Coin
World advertisers. Not a single one of them were ethical. One
well-known dealer eyed the Standing lib for several minutes, declared
it an "extra-fine" and offered me $900.


Who said this?


For the record, I sent the coins back through the slabbing process -
the standing lib came even back MS-63. Lol! I sold both of them -
this time letting the dealer in LA know I knew what the coins were
actually worth. The final price:


That's very fast turnaround from PCGS/NGC, especially given that the coin were
raw at the show. Which service turned them around so fast? Who's the LA dealer?

1916 Standing Lib: $5300
1892-O Half Eagle: $1600

Oh, and why did I take such a low price on the standing lib? I was
actually offered more. Because I think the grading service messed up;
in my own eyes it is a great AU, not a poor UNC. And ethically, I
could not take more. I wonder if this dealer will discount the coin
against the grade when he sells it . . .


You were offered more and you turned it down? That may not have been wise, for
an AU58 to go to an MS63 is NOT uncommon, PCGS has said they will "upgrade" a
nice AU to MS-something because thats where nice AU's sell. Nice AU's bring more
than ugly mint state.

It's a great story, but with the claims presented you need a few more specific
facts to back it up. certainly, the dealer who offered you too much for the 1916
will remember you, and likely the dealer you took to task as well. If you can
back this up with names, this is the sort of story that should be mailed to Remy
Bourne, the new head of the ANA consumer protection group.

As it stands, you might send it to Gary Lewis. Since it doesn't mention any
names or grading services, he might respond in a general way.

Bruce

  #4  
Old August 26th 03, 10:08 PM
Ira Stein
external usenet poster
 
Posts: n/a
Default

Bruce Hickmott responds to Phil barnhart's post:

Which services graded which coins?
Which dealers said what?
Who said this?
That's very fast turnaround from PCGS/NGC, especially given that the coin
were
raw at the show. Which service turned them around so fast? Who's the LA dealer?

You were offered more and you turned it down? That may not have been wise,
for
an AU58 to go to an MS63 is NOT uncommon, PCGS has said they will "upgrade" a
nice AU to MS-something because thats where nice AU's sell. Nice AU's bring
more
than ugly mint state.

It's a great story, but with the claims presented you need a few more specific
facts to back it up. certainly, the dealer who offered you too much for the
1916
will remember you, and likely the dealer you took to task as well. If you can
back this up with names, this is the sort of story that should be mailed to
Remy
Bourne, the new head of the ANA consumer protection group.

As it stands, you might send it to Gary Lewis. Since it doesn't mention any
names or grading services, he might respond in a general way.

Bruce

Bruce, you were too kind. The story is 90% bullcrap.
$900 for an AU 1916 SLQ? This poster loves to stir up the pot with stories of
unethical dealers. I doubt he'll ever mention names here or elsewhere, where
such mention could come back and bite him, and bite him hard! I might expect
some kernel of truth had he shopped those two coins at a flea market, but at
the Baltimore ANA?


Ira Stein
  #5  
Old August 27th 03, 12:05 AM
James McCown
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Default

ospam (Ira Stein) wrote in message ...
I find your story hard, no, impossible to believe.


I don't.
  #6  
Old August 27th 03, 12:38 AM
DONDI3
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Default

In article ,
(Edward McGrath) writes:


I was in a coin store 2 years ago when two dealers / owners ripped a guy
off by paying the guy a little above melt value for a gold coin worth
$4000 so I know there are dishonest dealers in the coin business. I'm
not saying all dealers are dishonest because I don't no all the dealers.
In my experiences I equate the coin dealers to predators waiting to
pounce down on unsuspecting newbies. Your only protection from these
dealers / predators is knowledge. If your as kwowledgable as the dealer
then and only then can you negoiate a fair price for your buys and
sells.


Your comment is as vague as the original story. My (non-numismatic) brother in
law still thinks that I'm trying to rip him on a couple of commems (Grant and
Monroe) that he swears are worth $6500. I've seen 'em and they're polished,
complete with hairlines and high gloss. The Grant might retail for $75 and the
Monroe around $20. I've offered him $80. He's told me several times that "a
guy" at a flea market told him 10-15 years ago they were worth the $6500 and
that he'd pay $5500 for 'em. "The guy" surprisingly lost interest in his
collection and doesn't want them, of course, but my BIL still wants $5K for
'em. They'll bury them with him, before he sells 'em for less than $4K, he
sez, and he's told the story probably several hundred times. It's one of the
reasons I'm very skeptical when I hear stories like yours and the original
poster's. Some are vicious fabrications meant to damage the coin business, and
others are simple misunderstandings and/or exagerations. I wish I had a nickel
for everyone who shows me a AG/Good coin worth $5 and points to the MS65 column
in their redbook and wants $750 for it.

I wasn't even going to comment on that original posting because it's so
transparently phony that I can't see ANYONE believing it. I'd guess someone had
a good time writing that bit of fiction and even added that cute "upgrade" coup
de grace in their enthusiasm. I, too, agree that not all dealers are honest and
not all offer fair prices when offered high value coins. But for 40 dealers at
any major show, or even a regional or state show to pass up a chance to handle
a "hot" and easily upgradable coin like an AU '16 SLQ is totally ridiculous. I
would have maybe bought into a couple of lowball bids from guys who didn't have
the money or just a few slimballs, but why would anyone let a deal walk where
$500+ profit is flat out guaranteed? Those coins would have never made it past
my table, and I'd have turned the profit before I left the show, probably
before I ate supper.

I'm glad a couple others spoke up and posted their thoughts.

Dondi3
DONDI enterprises. BUY, SELL, TRADE. RARE COINS & PRECIOUS METALS
Member COINNET, CSNS, ANA, INA, MOON, ILNA.
  #7  
Old August 27th 03, 03:15 AM
Jack Russell
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Default


My good friend, the law profession, paid for drinks that night - and
looked ill about our day. He agreed with me - in ANY other field what
these dealers attempted would be unethical; in many cases even
criminal fraud. One man's "caveat emptor" is another man's thievery.
And I am sick of the lot of them. I just can't stand being around an
entire crowd of people all trying to rip each other off. And
certainly not any "fun." I've switched to wine tasting.


What are going to do after you find out the $50 bottle of wine you bought
only cost the winery $12 to produce?

Jack


  #8  
Old August 27th 03, 05:24 AM
Blaine
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Posts: n/a
Default

Agreed,
years ago I was ripped off selling a gold coin.
It wasn't until some time had passed that I realized just how bad I was
taken

"Edward McGrath" wrote in message
...
I was in a coin store 2 years ago when two dealers / owners ripped a guy
off by paying the guy a little above melt value for a gold coin worth
$4000 so I know there are dishonest dealers in the coin business. I'm
not saying all dealers are dishonest because I don't no all the dealers.
In my experiences I equate the coin dealers to predators waiting to
pounce down on unsuspecting newbies. Your only protection from these
dealers / predators is knowledge. If your as kwowledgable as the dealer
then and only then can you negoiate a fair price for your buys and
sells.



  #9  
Old August 27th 03, 06:43 AM
Clark Smith
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Posts: n/a
Default




My good friend, the law profession, paid for drinks that night - and
looked ill about our day. He agreed with me - in ANY other field what
these dealers attempted would be unethical; in many cases even
criminal fraud. One man's "caveat emptor" is another man's thievery.
And I am sick of the lot of them. I just can't stand being around an
entire crowd of people all trying to rip each other off. And
certainly not any "fun." I've switched to wine tasting.


What are going to do after you find out the $50 bottle of wine you bought
only cost the winery $12 to produce?

Jack



And then what will you do when you realize the $50 bottle of wine was
marked up 100% by the wine seller?

Other wine sellers will then pay you only 50% for your unopened
bottles you want to sell back to a wine dealer.

Another question. What business are YOU in? I'd like to know.




  #10  
Old August 27th 03, 11:43 AM
JSTONE9352
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Posts: n/a
Default

I would like to see a real undercover
investigation on something like this.
Hidden tape recorders and video of the
interaction between the seller and the
dealer. A major convention would probably prohibit this so it would have
to be done very carefully.
 




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