Editors Note: The following is a letter we received following publication of an article on June 23rd by Louis Golino, “Are MS-70 Coins Value Traps” We felt the subject important enough to remove this from the comments section and post it as another viewpoint on the topic.
After reading “Are MS-70 Coins “Value Traps?“, I was impressed that Mr. Golino had the sense to recognize the need to write such an intelligent article in the first place, but walked away from it feeling that a true insider perspective was completely missing and needed in order to complete the mission of educating consumers on this subject.
The “to grade or not to grade” debate of whether or not to use certification companies is all but over. Time has concluded that it is simple personal choice, and anyone that suggests the likes of NGC and PCGS could do more harm than good, is simply uninformed.
It is true that First Strikes and Early Releases remains controversial, and my guess is this will not change. However, when you get right down to it, the buyer has a choice and if he or she does not like the concept no one is forcing them to embrace it.
I will agree that most retail buyers and dealers would prefer a “fresh” (an industry term used to describe never sent in for grading or picked over) coin in OGP over the same coin graded 69. Why wouldn’t they? With the fresh OGP coin, there is always the possibility that it could be a 70. I am sure some do view a 69 as “damaged goods” as you stated, however they are biased and/or uninformed. Graded 69’s are pristine examples that for very minor reasons did not achieve the ultimate grade.
Now, while on the subject of “the ultimate grade” you will see me use this term over “the PERFECT coin”, and for good reason. My professional opinion is that PERFECT coins DO NOT EXIST. Many decades ago a small group of numismatists decided to incorporate the term PERFECT into ANA grading standards to describe a 70. It seemed sensible and logical at the time. Today, it is well know among professional graders that if you use enough magnification (and sometimes LESS than the 5X standard you will often hear about) a trained eye will find very minor flaws, most mint made but sometimes flaws that occur after striking, on virtually every coin if not every coin ever made. For this reason, I am STRONGLY opposed to use of the word PERFECT and you will never see my company use it to describe any coin. I also do not like it because it is over-used and again at least in my opinion, misleading.
It is true that many if not most of the coins (except those intended for general circulation) produced in the past decade or so will seldom grade LESS than 69. While this could be a surprise to a Newbie, I think that the vast majority of repeat retail buyers and virtually all dealers already know this.
Populations most definitely do influence values on 70 coins, but even MORE important is good old fashioned DEMAND. A pop one coin means nothing if no one wants it, likewise I could name many modern coins with pops that are considered high for a modern, that have appreciated considerably in value from their issue price and are in high current demand. If you are ONLY buying modern coins based on the pop figures I would suggest that is a losing strategy.
Above and beyond all else, I suggest buying coins you like, and not as an “investment” but because you enjoy them. If possible, stick with coins that are popular and enjoy high demand. If they appreciate down the road it’s a win-win, if they don’t you still had fun along the way. If you are new to collecting I’d steer clear of any individual or company that gets carried away with silly dramatic hype, especially if it is not factual, and of those that use high pressure sales tactics of any kind whatsoever.
When buying certified modern coins, it usually pays off to be patient. If a new issue is red hot most of the time that means WAIT TO BUY. The risk of waiting is the chance that they could get tougher to find or increase in value, but more times than not they come down in price as the frenzy subsides. Shop around as Mr Golino suggested and make certain you are comparing apples to apples. Some sellers will deliberately make their product a bit confusing in hopes it will be interpreted as something else of greater value.
I am also in complete agreement with Mr Golino about sticking with NGC or PCGS when buying graded modern coins. The other services just simply are not even playing in the same league. Choose your dealer carefully. At first glance many may look reputable and trustworthy, but this is usually because of numerous affiliations that are mostly meaningless or can be bought. PNG is the most meaningful organization for a professional dealer to be associated with. Again, my opinion, but an opinion shared by many.
I would also like to address the views of John Robinson. It is true that many dealers especially shop owners, have this view of certified 69’s and even 70’s being worth less than OGP, and it is convenient for buying purposes but completely wrong to apply it across the board. For some, and I am not pointing to Mr Robinson or suggesting he would do this, (I believe he is very reputable) it’s easier to label it all “bullion” or “generic” or “common crap” or whatever when buying in part because it isn’t always easy to determine the value quickly and in part to buy it cheaper at base values. Like anything else one should sell specialty items (yes, certified modern coins are a specialty item) to dealers who specialize in them or to other collectors who understand and know their value if they wish to get the best price.
The last point I would like to make is that collecting OGP modern coins is easy. When possible buy them from the source, otherwise shop around. Modern certified coins is a highly specialized field and even large dealers like myself don’t deal in every item. For example, I have no clue what a Proof 70 Ike dollar would be worth nor would I be interested in buying one for inventory. That isn’t my customer base, it’s somebody else’s. I mostly steer clear of the “esoteric” low pop moderns because I personally have trouble with the lack of pricing information surrounding them, perhaps in the same way the shop owner is uncomfortable buying commonly traded 70’s at 70 prices. The difference is unless I am forced to make an offer by the customer in order to get other material I actually want, I typically just pass rather than make a low offer.
Thanks for the opportunity to respond to your excellent and well written article!
Bio: Full time dealer since 1978, Former PCGS part time grader, Former Vice President and Grading Finalizer for NGC, CEO ModernCoinMart/ JMRC, member 363 PNG.
Thanks for your thoughtful response to my article.
Nice level-headed, well informed commentary. Thank you for writing that.
Very surprising to hear that nearly all of these coins are MS69+….that really puts things into perspective.
Since you mention some opinions, I’ll just add mine: I doubt these special issue, seemingly endless, bullion coins, are going to see a long-term popularity amongst collectors. These are not real coins, plain and simple. In fact, I see some of them as insults to the US Mint’s own history. Some of the other stuff is getting very borderline, like the USPS has been doing with stamps now for decades…there comes a point where collectors grow weary of this stuff….and many of them go down in value as every stamp dealer knows well….and many US Mint Sets (which, really, are pretty stupid, eh?) never got out of the cellar value-wise either, and a lot of them were opened, melted down, etc.
I don’t think too many real gold eagles (1795–1933) got melted down, even when gold was at $1900…but you can bet your ass some of the MS69 $10 “First Spouse” will be headed straight to the smelter next time around, if not sooner. Mark my words. These are not going to hold up as collectables.