Salzberg Advises: Research PCGS Populations And Prices

Thanks for sharing ... I read the entire article and it is indeed eye opening

David

A few things that he fails to mention in an obviously-biased view against PCGS (I hate PCGS too, but the bias is evident here):

- All of his examples are conditional rarities, meaning their value is conditional on the number examples in the grade. If more are graded at that level, then the value goes down as it is no longer as "rare." Buying these top-end coins is completely stupid, especially for moderns. Their value can only go down.

- He makes his benchmark starting place at five years ago. This is about the time the silly "Registry Sets" came into being. These became immensely popular, and there was a surge in the values of high-grade moderns as people competed for the top slot in these sets. This in turn caused a surge of people sending in all kinds of coins in the hopes of attaining these high grades and thus the high premiums. More were certified in the upper grades, and the value of these conditional rarities went down.

- You also have people playing the "resubmission game" where they keep sending in a coin with the hopes of getting it to grade higher. This distorts the population numbers (and result in artificially inflating the grade of that coin).

- What is NGC's data regarding population numbers and value? Are the prices of NGC coins falling as well? What is the rate of the population increase in NGC's database for high-grade coins?


Folks, this is the reason why people insist on buying the coin, and not the slab. The people who lost tons of money were the ones that bought the printed two-digit number, which is only an opinion (an educated one, but an opinion nonetheless). The population numbers are going up, that is certain. Though the laxing of the grading standards is certainly an issue, there is more at work here, and it is not just PCGS that is affected. NGC is also practicing "gradeflation"; just look at the Indian cents in their holders. PCGS is not alone in this.

@ TypeCoin971793

I was having a lot of same thoughts as you while reading this. If he really wanted to shine a light on the issues he should have posted the figures for the NGC coins in each of his examples as they are likely similar graphs. I haven't read a lot of his commentary so I don't know if he makes a practice of trashing the competition.

It would be interesting to read a rebuttal by David Hall at PCGS.

Typecoin:

First, not all the coins are strictly conditional rarities only. I think most folks would agree that a 1912-S Liberty nickel is a key date, even if it is charted at the top. A 1945-S Walking Liberty half is certainly at the top end of the grade scale at 67, but I'm not sure I'd call that "only" a conditional" rarity. Yes, he is using the high end of the scale as comparison on all the coins, but that would be the LEAST likely grades for such huge increases in such a short time.

Second, you said that his benchmark was 5 years. Actually, if you READ the charts (forgetting months, just years)there was: 1-8 Year, 2-5 Year, 3-3 Year, and 3-2 Year comparisons.

You and I are usually on the same page on most things, TypeCoin, but I think your zeal against TPG's in general biased your opinion. You are usually pretty good at listening with an open mind.

The majority of coins I purchase are in a price range where I'm simply an idiot if I don't purchase them in NGC or PCGS holders. Especially considering that the prices for raw and TPG'd coins in those price ranges usually have little if any difference. So I'm usually not paying any more for the NGC or PCGS than I would for the same quality coin without their opinion.

In the last three years, particularly, I've been FORCED to buy more NGC coins than I have in the past.

I do keep track. In 2012 my purchases were 67% PCGS, 33% NGC, in 2013 my purchases were 58% PCGS, 42% NGC, in 2014 my purchases were 51% PCGS and 49% NGC, in 2015 my purchases were 47% PCGS and 53% NGC, and last year my purchases were 31% PCGS and 69% NGC.

So for myself, I've really turned more toward NGC for the simple reason that I DO buy the coin and not the holder. Most of the coins on my want list I have to look at dozens or even hundred of times for the same date and mint mark before I find one that meets my needs in eye appeal, grade, and price.

ALL OF the coins I've sold in the last two years have been PCGS. I haven't sold a single NGC, because I didn't have any I wanted to sell. In looking at some of the PCGS I bought recently, I see that I might have jumped too quickly on "filling the hole".

I've been to enough shows, both small and large, to get a good feel of what collectors, dealers, buyers, and sellers are feeling right now, and I can tell you that I've listened to some pretty "religious" spiels against PCGS on more than one occasion.

I was at the table of one dealer who was being offered a couple dozen nice medium grade (EF-AU) Bust Half Dollars in PCGS holders, and he was having a VERY rough time. Those are coins that usually have way more buyers than sellers. The dealer he presented them to said he would have to crack them and submit them to NGC before he could sell them. Maybe a "reason" for a lower offer, but I don't think so. He had about 12-15 Bust Halves which were all in NGC holders.

You can all decide for yourself by voting with your money, and while "buy the coin" will always be the rant shouted ad nauseum, sometimes the influence of a TPG grade should be entirely disregarded.

From my own experience I know I'm buying a lot more NGC coins simply because they meet my needs better.

I could start on classic silver commemoratives, but I've yammered way too long...

Makes little difference to me. I break out any coins I get from the slabs and discard the plastic and any info with it.

The report by Mark Salzberg is unprofessional using selective data to prove his point about PCGS grading standards. The coin population data that he is using to make his point is unreliable as it does not take in account crossovers and crack-outs. Most of his examples are modern conditional rarities that price trend down as higher end coins are submitted for grading. When you live in a glass house, you should not throw rocks. I hold both NGC and PCGS accountable for grade inflation and market grading that has taken place over the past years.

Anyone know when they stopped selling their pop reports? Yes they used to sell them each year as a printed book. I have (or at least had) several from each of them for just such a purpose as this. To see how the pops changed over time.