Puzzled: Ebay Slabbed Coins For Far Less Than Grading Costs.

Bobby, I get that scenario, too. But it doesn't seem like n00bs sending individual coins could generate enough volume to fill an online store with thousands of PCGS slabs. Also, I think if a n00b got torched for fifty bucks on a worthless coin, they would be more inclined to keep it rather than sell it for five bucks and take a -$45 loss.

A lot of these look like proof set breaks where everything was submitted, but in a modern proof set (silver or clad), who bothers to grade the nickel and cent? Again, I get that people might pay up for State Quarter proofs, for example. But why would a dealer submit the other coins instead of just selling them raw or in a roll?

That just doesn't make much sense to me. Some of these 40% and 90% silver coins are selling for like $1 over melt, in a graded slab.

You might also send in a full mint set as the silver coins sell for a large premium in 70. You'll take the loose on the cent and nickel.

From speaking to a dealer if one sends in 1000+ coins the bulk submission is or was less than $10 per coin. I have no evidence it's that low but with so many graded modern coins I wouldn't be surprised if it was that low.

When you send in hundreds of mint sets, the value of your time adds up. It's cheaper to send it in than you or your staff take it apart.

I couldn't agree more with bobby131313, I've been on some of those facebook groups and called a liar and a hater just because I said someone's "error" coin was damaged.

I believe we have an imperfect understanding of the system. Large coin retailers aren't fools, or they would be out of business. They aren't incorporating repeatable, easily avoidable losses into every transaction. I can imagine any number of possibilities. For one, the $10 number could be way off at scale. For another, maybe my sampling period is at a low point price-wise. Perhaps there is another factor at work, for example, a deal packaging phenomenon or a purchase add-on phenomenon. Possibly a marketing advantage like number of listings, or generation of numerous sales and positive reviews. Those dealers are getting something out of it that they perceive to be worth more than the cost. But they aren't just blindly paying $10 to slab a nickel that sells for $3. Particularly when the costs are up front, and the coins can sit in inventory for a long time, tying up that cash outlay.

If they are, then that business model is ripe for disruption.

So basically the money making bonanza is on the first day of release? Then what we see on the market is the leftovers and non-PF70/MS69-70 coins? I could buy that. But then what about all the graded coins from the 1970s, 1980s, 1990s? Surely the registry set top-pop game hasn't been going on that long?

+1 for Jbuck and Bobby. As a seller sometimes, These coins may be used for generating traffic to their ebay stores actually. A few others use $1 auctions instead where they generally wont get to normal pricing as when listed buy it now fixed price, but once in a long while can have a bid war on something.

Some are from individuals who think they have that one MS68 and don't look at the census for that grade, send it in, then ultimately dump it later to a coin dealer as part of a larger collection when they stop collecting or trying (again due to inexperience not selling themselves). People are chasing those high value coins and the rest get dumped as there arent as many collectors of graded modern coins and many dealers don't even want to mess with them.

Also, I can tell you I picked up a lot of coins through low priced auctions for graded coins setting fixed bids at the last minute, the ended prices far less than what I would have paid for grading alone but usually win only modern coins like that where there are fewer bidders and perhaps bad timing for the auction. This doesn't seem to happen for example with collectible coins, silver etc. Once in awhile that could be experience of the seller just throwing up stuff in auctions without consideration too much of maximizing individual value of each coin.

As far as bulk, I'm not sure how much are coming from that because they would usually just not grade it when it fell below the desired grade, although its possible with the discounted rate when they chose to grade in bulk they can make a profit where normally you wouldnt grading just a few, or at least take a smaller loss on those where the profit came from the ones that were the top grade in the submission, and dumping the rest as suggested.
https://www.pcgs.com/services/bulksubmissions