This is why CAC fails to impress me

[MarkFeld]

Tradedollarnut:

 

The quote, "CAC exists to make a market in coins it desires to buy..." came from your post made on this thread (#6705778 - Yesterday at 10:33 AM). It's the fourth post.

 

Why don't you 'splain it to us poor, stupid peasants.

 

 

No need to explain it - it's a straightforward assertion of fact. Why don't YOU explain your assertion that it represents a conflict of interest. How so? Do tell...

 

Oh - and cut the attitude. /eyeroll

 

Awww...were you caught with your ethical pants down -- or is it just your inflated ego that's injured?

 

Even us poor, stupid peasants can understand that if a business rates or otherwise qualifies coins so it can "make a market in them" there is obviously impaired objectivity. But, then, your "ethical standards" are so clearly superior to us po' folk, that no one could possibly challenge you.

 

TDN has hitched his business star to the CAC comet and one should take that into consideration when one reads his posts. CAC is infallible so far as he is concerned. For those us who follow the issue, it was well known that some coins have been CAC'd and de-CAC'd because of certain issues.

 

I have yet to see any service or system that is 100% infallible.

 

And despite your accusation, I have yet to see where TDN ever indicated that CAC was "infallible". Please back it up with facts/a quote from him or retract your mischaracterization.

[Tradedollarnut]

Tradedollarnut:

 

The quote, "CAC exists to make a market in coins it desires to buy..." came from your post made on this thread (#6705778 - Yesterday at 10:33 AM). It's the fourth post.

 

Why don't you 'splain it to us poor, stupid peasants.

 

 

No need to explain it - it's a straightforward assertion of fact. Why don't YOU explain your assertion that it represents a conflict of interest. How so? Do tell...

 

Oh - and cut the attitude. /eyeroll

 

Awww...were you caught with your ethical pants down -- or is it just your inflated ego that's injured?

 

Even us poor, stupid peasants can understand that if a business rates or otherwise qualifies coins so it can "make a market in them" there is obviously impaired objectivity. But, then, your "ethical standards" are so clearly superior to us po' folk, that no one could possibly challenge you.

 

What an

[RWB]

Ah, now I understand better. Thanks, Bill, Kurtdog, coinbuf, and others. I admit to paying little attention to the money end of coins, or to what each grading company does or does not do. The original quote just "jumped out" as being incredibly "odd."

 

Just for clarity – my simplistic opinion is that a business that presents itself as objectively evaluating the authenticity or state of preservation of a coin cannot also buy, sell or otherwise profit from that work. In the vernacular: "The fox cannot guard the hen house."

 

I’ll sign off from this thread so as not to further distract the conversation.

 

 

 

[Tradedollarnut]

For those that don't know, I used to own part of CAC. So yes, I believe in what it's doing. Oh - and it doesn't grade coins in the traditional sense of the word.

 

Also, for those who don't know, RWB cannot contain his venom ever since he basically made a money grab on the forum and accused me of not paying enough to support numismatic research (ie: him!) and I said no friggen way.

[TonerGuy]

 

Just for clarity – my simplistic opinion is that a business that presents itself as objectively evaluating the authenticity or state of preservation of a coin cannot also buy, sell or otherwise profit from that work. In the vernacular: "The fox cannot guard the hen house."

 

+1

 

I wonder how people would feel if NGC and PCGS were in the business of buying and upgrading coins ? How much backlash would there be if a collector (or even a dealer) tried to up grade a coin and it got rejected just to find out that NCG/PCGS later bought the coin through an intermediary and upgraded the coin by a full point and then resold it for a considerable profit at auction ?

 

 

[MarkFeld]

 

Just for clarity – my simplistic opinion is that a business that presents itself as objectively evaluating the authenticity or state of preservation of a coin cannot also buy, sell or otherwise profit from that work. In the vernacular: "The fox cannot guard the hen house."

 

+1

 

I wonder how people would feel if NGC and PCGS were in the business of buying and upgrading coins ? How much backlash would there be if a collector (or even a dealer) tried to up grade a coin and it got rejected just to find out that NCG/PCGS later bought the coin through an intermediary and upgraded the coin by a full point and then resold it for a considerable profit at auction ?

 

 

That's a very poor analogy, as that's not what CAC does.They don't buy and then resubmit or upgrade coins. They make markets in certain coins, by buying them in holders and then reselling them in the same holders.

 

For those who have a problem with CAC evaluating coins and also making markets in some of them, I can understand that. But please don't accuse them of doing (other) things they don't do.

[TonerGuy]

That's a very poor analogy, as that's not what CAC does.They don't buy and then resubmit or upgrade coins. They make markets in certain coins, by buying them in holders and then reselling them in the same holders.

 

For those who have a problem with CAC evaluating coins and also making markets in some of them, I can understand that. But please don't accuse them of doing (other) things they don't do.

 

I didnt accuse them of anything. I merely posed a hypothetical...

 

But Mark let me ask you a question...

 

Do you believe a "gold bean" on a coin represents CAC's opinion that the coin is under graded ? If so, then in some way, CAC is also stating that the coin at the original grade is also probably undervalued ? And isnt that similar to an upgrade by PCGS/NGC ?

 

I could be way off base so please explain since I am obviously and relatively uninformed when it comes to CAC and their policies... I have never submitted a coin to them nor have I ever purchased a green or gold bean coin.

 

[e1cnr]

There are many great coins with CAC stickers (solid for the grade), there are many great coins that are in plastic that are maxed out and will not get a CAC sticker because they are a half a point or point high, and there are many great coins that are raw.

 

If I were a salesman, selling to rich investors willing to spend a million (or tens of thousands) on a coin (but they did not know much about coins), NGC or PCGS CACd coins would be a good route to go (to keep out of jail).

 

CAC is beyond reproach with their methodology - they do not charge more depending on coin value, buy back their mistakes, and set a market for coins worthy of their willingness to own.

 

They are much different than a grading service that charges more for their service if they score a coin higher (which would seem like a conflict of interest).

 

I have never owned a CAC coin, but I do not buy those kind of coins.

[MarkFeld]

That's a very poor analogy, as that's not what CAC does.They don't buy and then resubmit or upgrade coins. They make markets in certain coins, by buying them in holders and then reselling them in the same holders.

 

For those who have a problem with CAC evaluating coins and also making markets in some of them, I can understand that. But please don't accuse them of doing (other) things they don't do.

 

I didnt accuse them of anything. I merely posed a hypothetical...

 

But Mark let me ask you a question...

 

Do you believe a "gold bean" on a coin represents CAC's opinion that the coin is under graded ? If so, then in some way, CAC is also stating that the coin at the original grade is also probably undervalued ? And isnt that similar to an upgrade by PCGS/NGC ?

 

I could be way off base so please explain since I am obviously and relatively uninformed when it comes to CAC and their policies... I have never submitted a coin to them nor have I ever purchased a green or gold bean coin.

 

To me, at least, your hypothetical led to the clear impication that CAC engaged in such activities.

 

Now, in answer to your questions

 

Yes, a gold bean indicates CAC is of the opinion that the coin is under-graded.

 

And that, in turn, could indicate they are of the opinion that the coin is undervalued, based on the current grade on the holder. I wrote "could", because that would be dependent upon what the owner is asking, if the coin is even for sale.

 

Any upgrade in value due to a gold bean, would go to the submitter/seller of the coin, not to CAC. CAC is merely evaluating it and providing an opinion. CAC does not submit coins or buy them and then award gold beans to them.

[TonerGuy]

 

To me, at least, your hypothetical led to the clear impication that CAC engaged in such activities.

 

Now, in answer to your questions

 

Yes, a gold bean indicates CAC is of the opinion that the coin is under-graded.

 

And that, in turn, could indicate they are of the opinion that the coin is undervalued, based on the current grade on the holder. I wrote "could", because that would be dependent upon what the owner is asking, if the coin is even for sale.

 

Any upgrade in value due to a gold bean, would go to the submitter/seller of the coin, not to CAC. CAC is merely evaluating it and providing an opinion. CAC does not submit coins or buy them and then award gold beans to them.

 

Mark - I think thats how you read it... I dont know CAC, its owners, its backers or even its supporters so I cannot imply anything about the motivation of people I do not know. That would be impossible and illogical.

 

I digress...

 

But back to the topic... I have another question -- so if CAC does not buy coins or submit coins as an independent entity - does any of CAC's owners/investors buy or sell coins or are in any way in the business of buying and/or selling coins ?

[MarkFeld]

 

To me, at least, your hypothetical led to the clear impication that CAC engaged in such activities.

 

Now, in answer to your questions

 

Yes, a gold bean indicates CAC is of the opinion that the coin is under-graded.

 

And that, in turn, could indicate they are of the opinion that the coin is undervalued, based on the current grade on the holder. I wrote "could", because that would be dependent upon what the owner is asking, if the coin is even for sale.

 

Any upgrade in value due to a gold bean, would go to the submitter/seller of the coin, not to CAC. CAC is merely evaluating it and providing an opinion. CAC does not submit coins or buy them and then award gold beans to them.

 

Mark - I think thats how you read it... I dont know CAC, its owners, its backers or even its supporters so I cannot imply anything about the motivation of people I do not know. That would be impossible and illogical.

 

I digress...

 

But back to the topic... I have another question -- so if CAC does not buy coins or submit coins as an independent entity - does any of CAC's owners/investors buy or sell coins or are in any way in the business of buying and/or selling coins ?

 

 

.....That would be impossible and illogical

 

Dear Spock,

 

CAC does buy coins - lots of them - but they don't resubmit them for up-grades. I don't know who the current owners/investors are, but believe it's extremely likely that at least some of them buy and sell coins.

[TonerGuy]

Mark - so I can understand you correctly - what you're saying is that CAC does buy & sell coins ( though you never stated that in your post - I will assume that they also sell the coins they buy unless you tell me otherwise ) and that it is very likely that those that invest and own CAC do buy and sell coins with the intent of making a profit.

 

Am I correct so far ?

 

And if so I am correct, then would you agree that it, at least, appears that there is some "potential" for a conflict of interest...

 

Would you not agree with that logic ?

 

And if you do I have to ask - if you know - does CAC have any protocols to prevent any "potential" conflicts ?

 

I do not know how their submission process works so please bear with me for these rather rudimentary questions...

 

Do their graders know who is submitting particular coins ?

 

Do they keep a photographic database of coins that have received a green or gold bean ?

 

Do they keep a photographic database of coins that did not meet their criteria for a green or gold bean ?

 

Do these photographs contain the serial numbers assigned to each coin by PCGS and/or NGC so that it can be tracked/traced ?

 

Does their database also have the serial numbers of coins that did and didnt make a CAC sticker ?

 

Sorry for all the questions but I am trying to figure all of this out...

[MarkFeld]

Mark - so I can understand you correctly - what you're saying is that CAC does buy & sell coins ( though you never stated that in your post - I will assume that they also sell the coins they buy unless you tell me otherwise ) and that it is very likely that those that invest and own CAC do buy and sell coins with the intent of making a profit.

 

Am I correct so far ?

 

And if so I am correct, then would you agree that it, at least, appears that there is some "potential" for a conflict of interest...

 

Would you not agree with that logic ?

 

And if you do I have to ask - if you know - does CAC have any protocols to prevent any "potential" conflicts ?

 

I do not know how their submission process works so please bear with me for these rather rudimentary questions...

 

Do their graders know who is submitting particular coins ?

 

Do they keep a photographic database of coins that have received a green or gold bean ?

 

Do they keep a photographic database of coins that did not meet their criteria for a green or gold bean ?

 

Do these photographs contain the serial numbers assigned to each coin by PCGS and/or NGC so that it can be tracked/traced ?

 

Does their database also have the serial numbers of coins that did and didnt make a CAC sticker ?

 

 

 

Sorry for all the questions but I am trying to figure all of this out...

 

You are not "correct, so far". I did say that CACS buys and sells coins in an earlier post: "They make markets in certain coins, by buying them in holders and then reselling them in the same holders."

 

[Tradedollarnut]

CAC puts a sticker on coins it would like to buy at the grade on the holder (or higher if gold but that is rare). Perhaps you could explain what you think could be a conflict. There are really only two scenarios - they consistently sticker a coin that doesn't deserve it or they consistently don't sticker a coin that does.

 

In the first instance - why? What is there to gain for CAC by doing so? More coins to buy and sell? If the coins aren't nice for the grade, who will buy them? In the second instance, again why? So they can buy them and then sticker them? Why not sticker them and then buy them?

 

No one has yet put forth a scenario that shows an incentive for any conflict of interest - all they do is insinuate.

[bsshog40]

I still don't quite understand thier concept. Thier website makes statements that make me think it would be a conflict of interest also.

 

CAC is an active bidder on many CAC coins. In fact, CAC has purchased over $275 million of CAC verified coins.

 

They have records of a coins stickered, so wouldn't this give them an edge by being able to look up coins by certification to be able to purchase? Wouldn't this also change the price market of such coins? I also realize that there are collectors within PCGS & NGC, but does either Company state that they will purchase thier own coins?? Besides warranty issues!

 

CAC was founded by leading members of the numismatic community who recognized the need for a higher level of grading.

 

This statement also makes me wonder how CAC can scrutinize the accurracy of PCGS & NGC. As I don't know much about them, would this pertain to the older holders that supposedly were loosely graded? I also read that the Gold Bean would be placed on an "A" coin, possibly stating that it would be undergraded. Does anyone know if PCGS or NGC has ever debated CAC's grading abilities or accuracy against thier own?? Just wondering.

[Mark T]

[quote=

 

 

{Do their graders know who is submitting particular coins ?}

 

Yes - it is on the submission sheet

 

{Do they keep a photographic database of coins that have received a green or gold bean ? }

Two years ago I asked John if they kept a photo data base – at that time his answer was no .

 

 

{Do they keep a photographic database of coins that did not meet their criteria for a green or gold bean ? }

 

No - see answer above

 

{Do these photographs contain the serial numbers assigned to each coin by PCGS and/or NGC so that it can be tracked/traced ? }

 

N/a

 

{Does their database also have the serial numbers of coins that did and didnt make a CAC sticker ?}

 

Yes - If a previously submitted and rejected coin is resubmitted this will show up in the database.

 

 

Sorry for all the questions but I am trying to figure all of this out...

[jom]

Personally, I don't see an issue with what CAC does. If they think the coin is an A or B they sticker. If not, they don't. I mean, what dealer or collector out there doesn't try to do the same thing every time they look at a coin? I guess people think that CAC would somehow NOT sticker a coin so they can be sneaky and buy the coin at a discount. OR...is it that some believe CAC would sticker a coin that doesn't deserve it. Neither makes any sense whatsoever...that latter is just dumb...the former doesn't guarantee that CAC would get the purchase the coin. So, I've come to the conclusion that CAC is trying to do EXACTLY what they say. What's the big deal?

 

My issue is really more based on how the coin collecting community reacts to all of this. This notion of somehow NGC graded CAC coins being inferior to PCGS graded CAC coin (in GENERAL) I find absurd...for example. But, whatever...there are a lot of things "markets" do that make no sense...it wouldn't be the first time.

 

jom

[Mark T]

I have yet to see a CAC topic that did not morph into exactly what this thread has morphed into.

I will keep it simple - My experience with CAC has always been positive. With all the site unseen buying on the internet a CAC sticker can take a lot of the guess work out of buying coins. 75 % of my coins are CAC certified – most were purchased without a sticker and submitted to CAC. I do not have any Gold Beans.

[mommam17]

From the beginning CAC has had it's haters. Some wished it would fail. Some have been won over and now like it. Look at the haters, and look at the supporters. I know I'd much rather stand with the supporters.......

[Raisethis2]

This thread is getting harder and harder to wrap my head around.

 

Why......would CAC want to be a Market Maker in anything?

 

What do they do with the 275 million dollars in coins they bought?

 

How far of a reach is it for (as an example) principals within CAC wanting to make a market out of currently depressed Walking Liberty Half Dollars knowing that in their personal vault there are hundreds in bank rolls that haven't seen the light of day in 75 years........(again, just an example).

 

I'm no lawyer but I can see the potential for conflict.

[Mark T]

This thread is getting harder and harder to wrap my head around.

 

Why......would CAC want to be a Market Maker in anything?

 

What do they do with the 275 million dollars in coins they bought?

 

How far of a reach is it for (as an example) principals within CAC wanting to make a market out of currently depressed Walking Liberty Half Dollars knowing that in their personal vault there are hundreds in bank rolls that haven't seen the light of day in 75 years........(again, just an example).

 

I'm no lawyer but I can see the potential for conflict.

 

There is no conflict in interest with CAC making markets. In the stock market , analysts will put out buy and sell recommendations on stocks while their firms can be market makers in that stock.

[FishyOne]

I have yet to see a CAC topic that did not morph into exactly what this thread has morphed into.

I will keep it simple - My experience with CAC has always been positive. With all the site unseen buying on the internet a CAC sticker can take a lot of the guess work out of buying coins. 75 % of my coins are CAC certified – most were purchased without a sticker and submitted to CAC. I do not have any Gold Beans.

 

I could have written this post. It mirrors my experience to a T except that I have "earned" one CAC Gold sticker on a G$5 Lib that I have now sold.

[19Lyds]

"CAC exists to make a market in coins it desires to buy..."

 

If correct, this sounds like compromised objectivity.

A little late to the game for me but "It is Roger".

 

Why else would CAC have needed $25 million in startup costs?

 

If it was as simple as buying some stickers, renting a loft, and buying some software, a thousand other experts would be doing the same thing AND having an affect on the market.

 

Many have but there's bvery little affect on the marketability of their stickers. Most of the Top Coin Dealers now simply include a CAC Submission for all their inventory.

 

I would never have thought it was possible but JA and many others pulled it out where the sticker can be the decision maker in which coin to buy.

 

This is where the market currently resides as silly as it may seem.

[19Lyds]

Ah, now I understand better. Thanks, Bill, Kurtdog, coinbuf, and others. I admit to paying little attention to the money end of coins, or to what each grading company does or does not do. The original quote just "jumped out" as being incredibly "odd."

 

Just for clarity – my simplistic opinion is that a business that presents itself as objectively evaluating the authenticity or state of preservation of a coin cannot also buy, sell or otherwise profit from that work. In the vernacular: "The fox cannot guard the hen house."

 

I’ll sign off from this thread so as not to further distract the conversation.

 

 

Don't sign off Roger. There's more to be discussed and compared.

 

As for CAC "buying" the coins they sticker, how much different is that from PCGS or NGC's Buy Back plans?

 

In other words, they back their grades with a buy back guarantee which means that if the coin they graded does not meet their specifications for some unseen reason, they guarantee that they'll buy it back at market prices.

 

Most collectors take the down grade and the difference in cash but what happens to the coins where collectors do not do that? Don't they end up downgraded by PCGS or NGC anyway and then resold?

 

I once submitted an IKE Dollar to PCGS which they graded at MS65 even though I personally thought that MS63 was pushing it. They offered a generous buyback along with a down grade which I refused since it just didn't seem right. I chose free grading submissions instead.

 

I guess I just do not see any "conflict of interest" with CAC's policies as their buyback is what gives the sticker real value.

[Kurtdog]

CAC puts a sticker on coins it would like to buy at the grade on the holder (or higher if gold but that is rare). Perhaps you could explain what you think could be a conflict.

The way you make it sound they're buying a pair of shoes. Use the correct terminology, substitute "bid" for "buy." That's how they're manipulating the market for their stickers, they're bidding them up. Real difficult concept for a coin collector to grasp, isn't it?

[Tradedollarnut]

CAC puts a sticker on coins it would like to buy at the grade on the holder (or higher if gold but that is rare). Perhaps you could explain what you think could be a conflict.

The way you make it sound they're buying a pair of shoes. Use the correct terminology, substitute "bid" for "buy." That's how they're manipulating the market for their stickers, they're bidding them up. Real difficult concept for a coin collector to grasp, isn't it?

 

Bidding a bonafide bid for something you are prepared to buy is not 'manipulating' a market. Nice choice of words - but totally bogus

 

It is, in fact, setting a market.

[jom]

From the beginning CAC has had it's haters. Some wished it would fail. Some have been won over and now like it. Look at the haters, and look at the supporters. I know I'd much rather stand with the supporters.......

 

I agree here. I don't know what there is exactly to "hate". I mean, if you disagree with the sticker then just don't buy the coin (or whatever) or just ignore the sticker. I suppose it would be frustrating to have to pay a premium for the coin now that it has been stickered but that was true when, say, a coin that was graded 64 then later got an upgrade to a 65. You'd have to pay more then too. So what? Go find another coin. Geez....

 

What CAC does or doesn't do really has no effect on my buying (except perhaps paying more in some cases)...they DO help in coin evaluation when I sent stuff in and that can only be positive, IMO.

 

jom

[FishyOne]

This thread is getting harder and harder to wrap my head around.

 

Why......would CAC want to be a Market Maker in anything?

 

What do they do with the 275 million dollars in coins they bought?

 

How far of a reach is it for (as an example) principals within CAC wanting to make a market out of currently depressed Walking Liberty Half Dollars knowing that in their personal vault there are hundreds in bank rolls that haven't seen the light of day in 75 years........(again, just an example).

 

I'm no lawyer but I can see the potential for conflict.

 

There is no conflict in interest with CAC making markets. In the stock market , analysts will put out buy and sell recommendations on stocks while their firms can be market makers in that stock.

 

I don't see the problem either. Perhaps there could be a concern but what in this world is free of any and all concerns?

 

CAC fills a market niche (primarily) in reviewing high-end, pricey pieces and stands behind the review with bids. Those who don't like CAC will always be able to find fault regardless of what they do.

[TonerGuy]

 

 

{Do their graders know who is submitting particular coins ?}

 

Yes - it is on the submission sheet

 

{Do they keep a photographic database of coins that have received a green or gold bean ? }

Two years ago I asked John if they kept a photo data base – at that time his answer was no .

 

 

{Do they keep a photographic database of coins that did not meet their criteria for a green or gold bean ? }

 

No - see answer above

 

{Do these photographs contain the serial numbers assigned to each coin by PCGS and/or NGC so that it can be tracked/traced ? }

 

N/a

 

{Does their database also have the serial numbers of coins that did and didnt make a CAC sticker ?}

 

Yes - If a previously submitted and rejected coin is resubmitted this will show up in the database.

 

 

Sorry for all the questions but I am trying to figure all of this out...

 

If there is no way for CAC to track the coins then I have more confidence in their objectivity and the potential for conflict is lessened.

 

If there is no way for CAC to track coins then it is less likely for any impropriety. The only conflict I can see is if CAC purposefully didnt sticker a coin only to buy it on the open market and then put a sticker on it and thus raising its value.

 

As TDN pointed out if CAC is bidding/buying coins on the open market and driving up the price for CAC coins then they are only going to pay higher prices as well.

 

It might make the market for their stickers stronger but I dont see a conflict in that. That helps their customers and those that pay fees for such stickers. No different then PCGS or NGC does with their registry set rules and crossover issues. Thats good business in my opinion.

[Kurtdog]

CAC puts a sticker on coins it would like to buy at the grade on the holder (or higher if gold but that is rare). Perhaps you could explain what you think could be a conflict.

The way you make it sound they're buying a pair of shoes. Use the correct terminology, substitute "bid" for "buy." That's how they're manipulating the market for their stickers, they're bidding them up. Real difficult concept for a coin collector to grasp, isn't it?

Bidding a bonafide bid for something you are prepared to buy is not 'manipulating' a market. Nice choice of words - but totally bogus

 

It is, in fact, setting a market.

Dorothy Parker, when asked to use the word "horticulture" correctly in a sentence: "You can lead a whore to culture, but you can't make her think."

 

We'll call it, "setting," here, for this bunch. I've got a big bird to catch. Wish me a happy landing.