Just look at the forum here and see how many times people are so very upset with the TPGs for grades they put on slabs. They have no accountability and this makes it easy for them to make money.
Here is some factual education about the coin grading/slabbing companies:
1. The major numismatic misconception is the need for grading services. The rest of the world looked at the U.S. as being foolish when these systems were initiated. Non Americans were questioning why anyone would pay good money for someone else to tell them what they were well capable of doing for themselves if they would just read the guidelines in any readily available source.
But the self-proclaimed (note that term) experts founding these companies knew there is a psychological desire in humans to have an "expert's" stamp of approval. The dollar signs were too tempting and so we have coin slabbing mills. They were in the country whose people, at the time, had the most disposable income (hey, they were literally selling pet rocks in stores here!) and the opportunity to take advantage of the situation was just too great for them so ignore.
This led to major damage in the hobby:
1. Slabbing refocused the hobby's entire attention to the slabbed items while reducing everything but keys and semi-keys to "junk silver" (or copper where applicable).
- Older collectors who remember these services starting up remember the hobby was a lot more fun. Why? It was a time when every date/MM combo on a coin had its own perceived value. Coins of lesser mintage were usually assigned higher prices since they were more difficult to locate.
But now if its not a key - a coin is simply melt value and something to plug a hole in the album with. Thanks for nothing.
2. Special designations such as FBL, FSB etc. were introduced.
- People who had "gem BU" coins all of a sudden found their top coins were not so special anymore b/c they were not perfect strikes. The value of BU coins suffered. Granted the special designations are pointing out the best strikes - but now "gem BU" means a lot less than it used to.
3. TPGs knew people would pay for more options added to multiples of the exact same coin such as different artwork on the labels. It was from this forum I learned "First Day of Issue" are not actually what they claim.
4. The birth of a second level of security blanket being desired by the public:
Back when the slabs started - and will use the words we did back then - no offense to anyone reading this - we joked that someday someone else would see another business opportunity and start to offer a service that would charge people to check the TPGS had done their job properly. But we knew no one would ever be that much of a sucker. Guess what? Green Bean stickers now automatically make a slabbed coin worth more.
And it was just a year or so ago that there was a company trying to cash in and check the CACs!
5. Ignoring ages old technology to eliminate human error:
- In the 90s all the main slabbing mills invested into a computerized grading system which would have made a science out of grading instead of it being based on human opinion. The suddenly the systems disappeared. The technology WAS available. Such a scanning device has been in industry since at least the early 90s (I know - I used a parts scanner capable of evaluating any number of points on manufactured parts down to thousandths of an inch to evaluate if the part was within quality standards).
So what happened? Let's imagine companies put off implementing the system for 30-40 years. When the time is right (when most key coins are already slabbed) the "New and Improved" system is introduced to the market. People once again will pay them for the very same coins already in slabs! Why? Marketing... just how can you sleep at night not knowing if your MS70 coins is REALLY MS70? Remember - human error could have been involved.
We already see people not sure enough of the slabbing that they actually fork out more money for a green bean sticker! So how hard will it be for these companies to yet push another grading sham on the public?
In this day when our phone in our pocket are capable of facial recognition, do we really think the slabbers are not capable of a totally scientific method of grading? Of course they are... and have been for at least 20 years. But they have been protecting themselves and holding back. Why? The almighty dollar - in their own pockets - is where their concerns lie - not the good of the hobby as a whole.
And now that they have been around for so long that enough new collectors have just grown up with slabbing being a part of the system, so there are people who, without researching and ever questioning the systems, believe slabbing has been a good thing and actually serves the purposes they claimed to have been started for. Of course these people have to ignore the fact that a business such as CAC can actually exist... but that's OK - there is psychological security people use to ignore opposing ideas.
Legitimate uses:1. I personally see a legit use for TPGs. I had some coins slabbed so if anything happens to me, my wife will know these need to be researched before just dumping them.
2. They also are doing a fair job of detecting fakes... but anyone with a little research can do the same (weight, specific gravity, magnetism, etc.). And the TPGS have been known to slab fakes.
3. If a person is in coins to make money - slabs will add more money to the price paid by a lot of buyers b/c people will buy the slab and not the coin.
My local shop owner said he used to be paid to grade for one of the main companies. They were paid by how many coins they got through. He said it was
fast. I talked to another old friend of mine who had also been a grader, he said the same thing -without mentioning I had talked with another former grader. Both of these guys are respected and known dealers in the state of PA, and both, with first hand experience, helped me understand just how much the faith people put in these "professionals" is sadly misplaced.
The following is sort of tongue in cheek, but its a graphic I once made of how I see the future:
I could go on, but will stop with this book!
Posted 01/28/2017 6:43 pm
