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 Replies: 10 / Views: 1,171 |
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Pillar of the Community
United States
2724 Posts |
I got thinking about this subject and wanted to offer a thought. I get asked about grading company X quite a bit. While I heavily support and recommend the top four (NGC,PCGS,ICG,ANACS), I thought that we may be able to think about why so many lower tier services are out there, and what purpose they serve.
As far as I can tell, we have so many low tier services because there are so many collectors asking for them. They pop up in the large online "flea markets" touting high grade coins for cheap prices. Well as the vast majority of buyers using these flea markets are looking for something for nothing, these grading companies are providing that service.
Online flea market buyer sits at home looking at their favorite price guide and sees that coin X in MS-67 has a value of $1000. So they look through the various auctions at the online flea market and see this coin X in MS-67 in a certified holder selling for $50. They raise their hands to Heaven and exclaim I have found something of great value.
So they part with their hard earned cash only to find that grading company X has overgraded the coin by a few points and that their coin is worth $5. Not to worry thinks the buyer, I will just offer this coin on the same online flea market auction and sell it to the next buyer, therefor completing the cycle.
Many people complain that these services exist, but they are filling a need. The need of buyers looking for something for nothing. Until people realize that rare coins are not cheap, these companies will survive.
Now before anyone jumps on the "dealer" (me) for making the remark that these companies survive on the flea market sites, let me add this. NONE of these fly by night companies have booths at any of the major shows.
As a matter of fact, most of the coins graded by these companies end up in the junk box of slabs offered "under $10" by most dealers. The online sites provide many benefits to the collector, but one of the biggest downsides is the unregulated system. They allow anyone to sell anything.
The hobby itself offers little to no protection as there are NO rules that apply hobby wide.
TV gets a lot of blame also, but they cater to those that "we" overlook. It is our job to educate others, not to knock the system. Look for a way to improve the hobby.
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Pillar of the Community
United States
1247 Posts |
The "lower" tier companies are taking advantage of greed in people. What about the "top" tiers that are taking advantage of fear in people? A fear that only exists because the "top" tier exists. And their 11 point Tower of Bable they put into place exist? Fear that it's all too complicated or a fear that they won't be able to re-sell their coins unless they've been blessed by one of the Great Holy Fathers.
Fear and greed exist in people whether they wish to acknowledge it or not and what's more if we wish to "advance" as a society, it has to exist. "Advances" can only happen if people take risks. Altruism is a fantasy. It's been replaced by the fantasy of "investing wisely."
Ode to the Top Tier:
"..and like some angel's haloed brow you reek of purity..."
Conquistador--Procol Harem
Edited by longnine009
06/12/2005 7:52 pm
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Rest in Peace
United States
2884 Posts |
Hey longnine, the song goes on to say..... I see your armour-plated breast has long since lost it’s sheen and in your death mask face there are no signs which can be seen....Does this portend the future of the "Big Three"?LOL Mike  |
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Valued Member
United States
157 Posts |
quote:
Originally posted by national dealer
Many people complain that these services exist, but they are filling a need. The need of buyers looking for something for nothing. Until people realize that rare coins are not cheap, these companies will survive.
Exactly. Many folks want to put marginal coins in third-world slabs and hope to put their "MS-67" coin on ebay and make a killing, when by established standards the coin may be MS-63, AU-58 or even cleaned or artificially toned. The flip side for people who know how to evaluate coins is that their "mistakes" which are almost accurately graded can be picked up very cheaply. But you have to know how to evaluate coins, find a good image and trust the seller and their return policy. |
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Pillar of the Community
 United States
2724 Posts |
quote:
Originally posted by longnine009
What about the "top" tiers that are taking advantage of fear in people?
I am not sure that I agree with "fear" but they certainly have a strong arm on the community. However, companies like ICG have made credible gains in the market without the "heavy" marketing and registry sets. This could very well be the future. Personally I would like to see stricter standards applied to ALL. No favorites, no polls, no buying endorsements, no strong arming the community, just plain and simple straight forward honest grading, based solely on the coin. Not the submitter, not the rarity, not the market value. Of course I may never live long enough to see it happen, but one day, I hope that collectors will demand more from the groups that are supposed to be guiding the hobby. |
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Pillar of the Community
United States
1247 Posts |
quote:
Originally posted by Mike
Hey longnine, the song goes on to say.....
I see your armour-plated breast has long since lost it’s sheen and in your death mask face there are no signs which can be seen....Does this portend the future of the "Big Three"?LOL Mike
Market Grading 101 "Well actually," it's not really lost sheen at all, although it may appear that way. "It's actually" a special finish.  It portends the future of market grading. You can't commodify market factors into a single net grade because coin collectors are too whimiscal which makes market factors way too fluid to be commodified. A collector today may pay $300 for some rivits on a shield. Tomorrow he might not want to pay 50cents for them. What happens to that grade when the price drops? Then collectors are blamed for being to picky etc when the blame goes to the retarded idea that individual desires can be commodified into one quaint little number. Edited by longnine009
06/13/2005 08:58 am
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Pillar of the Community
United States
2724 Posts |
quote:
Originally posted by longnine009
Then collectors are blamed for being to picky etc when the blame goes to the retarded idea that individual desires can be commodified into one quaint little number.
Now this I totally agree with. |
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Rest in Peace
United States
2884 Posts |
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Rest in Peace
United States
2684 Posts |
quote:
Originally posted by national dealer
Well as the vast majority of buyers using these flea markets are looking for something for nothing, these grading companies are providing that service.
ND, you put your finger on the root cause and problem: as long as people are human and humans are people, we will always have to deal with such frailties. In addition to wanting something for nothing, people aren't willing to put in the time nor effort to educate themselves, yet they maintain unrealistically high expectations. Hence, they will continue to be suckered. While we might be able to reach some of them or maybe even a measurable percentage of them, there will remain the large number of fools who venture into the quagmire. These numbers will always be high; as soon as one learns his/her lesson, another steps in to take his/her place. The streets are littered with those who fail to look before leaping. Darwin at work. And this phenomenon is certainly not restricted to coins. I am presently auctioning an old tin toy for the mother of a friend, a friendly gesture which, in retrospect, I probably should not have done. It is bringing in some decent bids, might top $100. What I didn't realize and wasn't told when I listed it is that she read some antiques article about antique toys and actually expects that this toy will bring in more than a thousand as described for a particularly rare toy. She is going to be grieviously disappointed and I'm gonna have to cancel the auction. Her expectations were unrealistically high and she didn't read the article carefully enough to realize that her toy didn't even come close to the rare toy described. Bad for business, bad for me, and bad for her; she will probably never even consider auctioning anything again. But, she is only human. This story is repeated for coins a thousand times per day. As long as people are human and humans are people, we will always have the third-tier and non-tiered grading companies to give people what they want. |
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Rest in Peace
United States
2884 Posts |
Fred, words of wisdom to be sure. The reason the companies exist is the ready and steady stream of treasure hunters looking for the big kill. Mike Edited by Mike
06/13/2005 9:53 pm
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Pillar of the Community
United States
980 Posts |
quote:
Originally posted by national dealer
[quote][i]
Personally I would like to see stricter standards applied to ALL. No favorites, no polls, no buying endorsements, no strong arming the community, just plain and simple straight forward honest grading, based solely on the coin. Not the submitter, not the rarity, not the market value.
Amen, brother. And it wouldn't be hard to do. A set of admittedly arbitrary standards, 3 graders that only see the coin-not the submitter, not what the others grade the coin. If their grades match, bingo- it is likely an accurate grade. If they don't bring in 2 more, who also don't know who owns the coin, previous grades given, etc, and see what grades they assign, then average them, after throwing out any outlier scores. Heck, anyone want to bankroll Don's grading company? My first hires are boardmembers, salary is 150k/yr plus bennies, amd anyone can submit a coin and get it back within 2 weeks for $10 plus s/h, or $10 flat at major shows.  And you get to live in the only city in the US where folks wear parkas to work in July, as ANA vistors wearing shorts will discover soon. "The coldest winter I ever spent was summer in San Francisco" attributed to Mark Twain |
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Replies: 10 / Views: 1,171 |
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Posted 06/12/2005 7:47 pm
