CAC questions

[brg5658]

A more accurate comparison would be to call it "market making." There's a big difference between market making and market manipulation.

Market making is market manipulation when you want to feel good about it. It's the same thing. It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

 

Exactly. I agree.

[MJ]

A more accurate comparison would be to call it "market making." There's a big difference between market making and market manipulation.

Market making is market manipulation when you want to feel good about it. It's the same thing. It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

 

Exactly. I agree.

 

Personally I'm happy that CAC labeled coins sell for a premium. For too long the weaker coins at the bottom of the grade held back the stronger coins.The separation of wheat from the chaff is good. It's actually good for those that earned CAC approval and also for non CAC coins that are solid + for grade and have not been to NJ. CAC has legitimately made quality for the grade a mission statement and has influenced the market positively. Those with a genuine good eye and a grasp for market grading should be rewarded.

 

Mark

[mommam17]

If you have nice coins, you will like CAC. If your coins aren't nice and don't sticker, you will probably hate CAC

[jom]

It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

 

The "seller" here is also a "buyer" right? So their "influence" makes it difficult for them to buy coins as much as it helps them sell coins, no?

 

I don't see the problem....

 

jom

[Kurtdog]

It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

The "seller" here is also a "buyer" right? So their "influence" makes it difficult for them to buy coins as much as it helps them sell coins, no?

 

I don't see the problem....

 

jom

They don't buy every coin they bid on, even though they easily can. They just raise your bids on those coins, if you want the coins. You know, just like any shill.

[coinman_23885]

It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

The "seller" here is also a "buyer" right? So their "influence" makes it difficult for them to buy coins as much as it helps them sell coins, no?

 

I don't see the problem....

 

jom

They don't buy every coin they bid on, even though they easily can. They just raise your bids on those coins, if you want the coins. You know, just like any shill.

 

I'm not sure if CAC bids in auctions on CAC stickered coins, but I have never heard of an instance of CAC refusing to buy a stickered coin when offered to it. I have never been denied. And your analogy to shill bidding is misguided. If anything, CAC stickers have made purchasing quality coins more expensive for CAC unlike what occurs in shill bidding where the goal is to artificially increase prices for the seller's pecuniary benefit. Also keep in mind that the actual stickering process is expensive to CAC and it likely loses on this end of the business. CAC's profit comes from making competitive bids and then reselling those coins like any coin dealership.

 

Also for those accusing CAC of market manipulation, does it change your position that CAC has purchased non CAC approved coins? It did this for generic gold at one point. The sticker is nothing more than an identification device and not a traditional business product. Put another way, CAC's product is quality coins that it doesn't produce, not plastic and stickers.

[coinman_23885]

A more accurate comparison would be to call it "market making." There's a big difference between market making and market manipulation.

Market making is market manipulation when you want to feel good about it. It's the same thing. It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

 

CAC isn't the seller of the CAC approved coins it bids on at the time obviously. It is not like CAC is auctioning off coins it owns and is bidding on them against others. And what is wrong with bidding on something you once sold? Have you never sold a coin and purchased it back at a later date? A free market economy would seemingly give you this right.

 

And any time you have a buyer that does significant business in a sector, the market will be affected. It is basic supply and demand. Would you accuse everyone who exerts a significant effect on the market to be manipulating the market? No because this is how markets work (supply and demand).

[coinman_23885]

In the stock market, that would be called market manipulation or insider trading. In the coin business, it's called "business as usual" apparently.

 

It is nothing like insider trader which involves employees, executives, or those close to the company ("insiders") using unpublished information not available to others in the marketplace unfairly and for their own pecuniary benefit. I don't see how this is comparable to CAC. CAC stickering determinations are public information and CAC competes openly and fairly with other market participants seeking to purchase CAC approved materials.

[Kurtdog]

A more accurate comparison would be to call it "market making." There's a big difference between market making and market manipulation.

Market making is market manipulation when you want to feel good about it. It's the same thing. It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

 

CAC isn't the seller of the CAC approved coins it bids on at the time obviously. It is not like CAC is auctioning off coins it owns and is bidding on them against others. And what is wrong with bidding on something you once sold? Have you never sold a coin and purchased it back at a later date? A free market economy would seemingly give you this right.

 

And any time you have a buyer that does significant business in a sector, the market will be affected. It is basic supply and demand. Would you accuse everyone who exerts a significant effect on the market to be manipulating the market? No because this is how markets work (supply and demand).

Boy are you naive. By bidding on their labels they're driving up the bidding on their labels. Other than that they make no pretense about it, they're no different than a shill.

[coinman_23885]

A more accurate comparison would be to call it "market making." There's a big difference between market making and market manipulation.

Market making is market manipulation when you want to feel good about it. It's the same thing. It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

 

CAC isn't the seller of the CAC approved coins it bids on at the time obviously. It is not like CAC is auctioning off coins it owns and is bidding on them against others. And what is wrong with bidding on something you once sold? Have you never sold a coin and purchased it back at a later date? A free market economy would seemingly give you this right.

 

And any time you have a buyer that does significant business in a sector, the market will be affected. It is basic supply and demand. Would you accuse everyone who exerts a significant effect on the market to be manipulating the market? No because this is how markets work (supply and demand).

 

Boy are you naive. By bidding on their labels they're driving up the bidding on their labels. Other than that they make no pretense about it, they're no different than a shill.

 

Naivety isn't a factor. You and the others are throwing around legal terms or those with precise technical definitions, and the conduct you are describing does not comport with those definitions/behavior. And they are very different from a shill - they are not colluding to artificially increase prices for their benefit. Rather, they are simply identifying coins of interest, affixing insignia, and pursuing those coins vigorously whenever the coins appear on the market. I do not see a problem, ethically or legally, and I do not see any putative conflict of interest. Again, CAC is not a certification service and there is no TPG style guarantee- it is an approval service with a sticker to identify coins that it will purchase. You may very well disagree with such the business model, but it is inaccurate to compare it to shill bidding or to insider trading as another poster has done.

[mommam17]

CAC is 7 years old this month. If they were doing anything wrong wouldn't they be in trouble by now? There are enough haters.

[Kurtdog]

A more accurate comparison would be to call it "market making." There's a big difference between market making and market manipulation.

Market making is market manipulation when you want to feel good about it. It's the same thing. It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

CAC isn't the seller of the CAC approved coins it bids on at the time obviously. It is not like CAC is auctioning off coins it owns and is bidding on them against others. And what is wrong with bidding on something you once sold? Have you never sold a coin and purchased it back at a later date? A free market economy would seemingly give you this right.

 

And any time you have a buyer that does significant business in a sector, the market will be affected. It is basic supply and demand. Would you accuse everyone who exerts a significant effect on the market to be manipulating the market? No because this is how markets work (supply and demand).

Boy are you naive. By bidding on their labels they're driving up the bidding on their labels. Other than that they make no pretense about it, they're no different than a shill.

Naivety isn't a factor. You and the others are throwing around legal terms or those with precise technical definitions, and the conduct you are describing does not comport with those definitions/behavior. And they are very different from a shill - they are not colluding to artificially increase prices for their benefit. Rather, they are simply identifying coins of interest, affixing insignia, and pursuing those coins vigorously whenever the coins appear on the market. I do not see a problem, ethically or legally, and I do not see any putative conflict of interest. Again, CAC is not a certification service and there is no TPG style guarantee- it is an approval service with a sticker to identify coins that it will purchase. You may very well disagree with such the business model, but it is inaccurate to compare it to shill bidding or to insider trading as another poster has done.

They've got skin in the game. They go after their labels. There's nothing illegal about it. But it means those prices are biased, skewed.

[Kurtdog]

CAC is 7 years old this month. If they were doing anything wrong wouldn't they be in trouble by now? There are enough haters.

There are enough pigeons, too.

[mommam17]

Pigeons eat the haters lunch every time. VERY amusing......

[Nutmeg Coin]

What percentage of coins with CAC stickers will they offer money for? Is there a difference between collectors and dealers on their offering money for a given coin?

[Kurtdog]

Pigeons eat the haters lunch every time. VERY amusing......

I pity the poor, little things, actually. I mean, their brains are so tiny.

[mommam17]

But they get to eat and aren't haters, who are starved for facts.....

 

 

[Afterword]

"I mean, their brains are so tiny."

 

 

 

And probably much happier than us because of it.

 

[Hard Times]

A more accurate comparison would be to call it "market making." There's a big difference between market making and market manipulation.

Market making is market manipulation when you want to feel good about it. It's the same thing. It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

 

Exactly. I agree.

 

Personally I'm happy that CAC labeled coins sell for a premium. For too long the weaker coins at the bottom of the grade held back the stronger coins.The separation of wheat from the chaff is good. It's actually good for those that earned CAC approval and also for non CAC coins that are solid + for grade and have not been to NJ. CAC has legitimately made quality for the grade a mission statement and has influenced the market positively. Those with a genuine good eye and a grasp for market grading should be rewarded.

 

Mark

 

Mark,

While I somewhat agree with your statement above, and I have stated here that I like to get CAC's opinion, I would suggest however, that is is only one opinion in a very subjective process of getting a grade and assessing quality within that grade. For many coins that make the CAC sticker or don't, I think that most experienced numismatists would agree with CAC's opinion, but on many, there are grey areas that can be discussed for ever and still no consensus will be reached. CAC has also shown that their subjectivity on these issues are no less than those they are grading - the TPG opinions on a grade. We have seen numerous examples where they put a green bean on a coin, the coin goes up or down in grade in a new holder, and they put a green bean on it again. So while it is true they have made 'quality for the grade' a mission statement', this 'quality' is their subjective opinion and nothing more. In fact, if I were to play devils advocate, I would say that I more agree with the opinions of Kurtdog and brg, that the real reason they are doing this is to manipulate the market and profit from it. That has to be part of why they do this, to sell coins THEY like. And to put a bean on them as a record of what they like. Makes it so much easier to make a market that way because most have played along. HST, doesn't mean that most beaned coins aren't quality for the grade, because they are, but just keep it in perspective on why they do this. It is all about money.

 

Best, HT

[newprepper]

I do not own any coins with a bean, I would buy one if it came along, obviously they know more about the coins than I do, along with all of you. I agree with a lot of what I have read coming from both sides. However, it seems that the most support for CAC comes from those with a vested interest in CAC being successful. While CAC bidding on coins that have beans that they don't own is not illegal, it still affects the overall market because higher prices on CAC coins could result in higher prices overall and that could result in higher prices for the coins CAC decides to sell. IMO that part of the CAC model does not pass the smell test.

[Hard Times]

I do not own any coins with a bean, I would buy one if it came along, obviously they know more about the coins than I do, along with all of you.

 

Too keep in it perspective tho', and this has been said by several before, many of the high end coins for the grade that have CAC stickers on them would go for strong prices anyway, especially when experienced numismatists who know how to grade are doing the buying, which they are, so for those who know how to grade, a sticker is not that important if they can see the coin in hand. I would however, suggest that there are many experienced numismatists who know how to grade as well as those at CAC, including the graders at NGC and PCGS, and some pretty amazing graders on these boards. So I suggest that perhaps your statement above might be abit too encompassing.

 

Having said that, a day discussing grading in particular grey area coins (those just above and below being bean worthy, or those with toning they deem not worthy, for example) with JA would be worth his weight in gold............

 

Best, HT

[MJ]

A more accurate comparison would be to call it "market making." There's a big difference between market making and market manipulation.

Market making is market manipulation when you want to feel good about it. It's the same thing. It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

 

Exactly. I agree.

 

Personally I'm happy that CAC labeled coins sell for a premium. For too long the weaker coins at the bottom of the grade held back the stronger coins.The separation of wheat from the chaff is good. It's actually good for those that earned CAC approval and also for non CAC coins that are solid + for grade and have not been to NJ. CAC has legitimately made quality for the grade a mission statement and has influenced the market positively. Those with a genuine good eye and a grasp for market grading should be rewarded.

 

Mark

 

Mark,

While I somewhat agree with your statement above, and I have stated here that I like to get CAC's opinion, I would suggest however, that is is only one opinion in a very subjective process of getting a grade and assessing quality within that grade. For many coins that make the CAC sticker or don't, I think that most experienced numismatists would agree with CAC's opinion, but on many, there are grey areas that can be discussed for ever and still no consensus will be reached. CAC has also shown that their subjectivity on these issues are no less than those they are grading - the TPG opinions on a grade. We have seen numerous examples where they put a green bean on a coin, the coin goes up or down in grade in a new holder, and they put a green bean on it again. So while it is true they have made 'quality for the grade' a mission statement', this 'quality' is their subjective opinion and nothing more. In fact, if I were to play devils advocate, I would say that I more agree with the opinions of Kurtdog and brg, that the real reason they are doing this is to manipulate the market and profit from it. That has to be part of why they do this, to sell coins THEY like. And to put a bean on them as a record of what they like. Makes it so much easier to make a market that way because most have played along. HST, doesn't mean that most beaned coins aren't quality for the grade, because they are, but just keep it in perspective on why they do this. It is all about money.

 

Best, HT

 

 

Fair enough. PCGS/NGC and CAC are all in it to make money.

 

Manipulate the market? I take umbrage with that.

 

FYI- I wouldn't buy a gold coin without John's blessing as it's not in my wheelhouse. Coins in my series I'm comfortable with finding my own way.

 

Mark

[Nutmeg Coin]

Here are a couple of examples, I ran these Bust quarters with the same grade, one got the bean the other didn't:

 

http://www.ebay.com/itm/1832-25C-Capped-Bust-Quarter-NGC-VF35-/331342464261?ssPageName=STRK:MESE:IT

 

http://www.ebay.com/itm/1835-25C-Capped-Bust-Quarter-NGC-VF35-CAC-/331342464259?ssPageName=STRK:MESE:IT

 

The first has more details, was Anacs XF40 (old small holder), now NGC VF35. I showed them to Tom of Elusive Spondulix at a coin show last weekend, and he liked the 1832 a lot more. These are lower end collector coins but they still are going to "discriminate" based on eye appeal, lack of problems, even toning and appearance.

 

Here is a $20 Liberty MS62 "star" that was not sent to CAC: http://www.ebay.com/itm/1905-S-20-GOLD-DOUBLE-EAGLE-MS62-STAR-NGC-PROOFLIKE-/231329583472?ssPageName=STRK:MESE:IT

 

It no doubt would have stickered with the exceptional eye appeal, but what would be the benefit? More potential buyers or interest? CAC only makes offers on coins they have a demand for at levels where they have upside profit potential. They may sticker but they probably won't make strong offers unless they need the coin. So with the expense of CAC submission plus shipping, you have to get advantages with that. With all the CAC fans there is probably significant advantage once you get above a certain price level.

[Hard Times]

A more accurate comparison would be to call it "market making." There's a big difference between market making and market manipulation.

Market making is market manipulation when you want to feel good about it. It's the same thing. It's the seller exerting direct influence on the market price of the product it sold by bidding on it in the market.

 

Exactly. I agree.

 

Personally I'm happy that CAC labeled coins sell for a premium. For too long the weaker coins at the bottom of the grade held back the stronger coins.The separation of wheat from the chaff is good. It's actually good for those that earned CAC approval and also for non CAC coins that are solid + for grade and have not been to NJ. CAC has legitimately made quality for the grade a mission statement and has influenced the market positively. Those with a genuine good eye and a grasp for market grading should be rewarded.

 

Mark

 

Mark,

While I somewhat agree with your statement above, and I have stated here that I like to get CAC's opinion, I would suggest however, that is is only one opinion in a very subjective process of getting a grade and assessing quality within that grade. For many coins that make the CAC sticker or don't, I think that most experienced numismatists would agree with CAC's opinion, but on many, there are grey areas that can be discussed for ever and still no consensus will be reached. CAC has also shown that their subjectivity on these issues are no less than those they are grading - the TPG opinions on a grade. We have seen numerous examples where they put a green bean on a coin, the coin goes up or down in grade in a new holder, and they put a green bean on it again. So while it is true they have made 'quality for the grade' a mission statement', this 'quality' is their subjective opinion and nothing more. In fact, if I were to play devils advocate, I would say that I more agree with the opinions of Kurtdog and brg, that the real reason they are doing this is to manipulate the market and profit from it. That has to be part of why they do this, to sell coins THEY like. And to put a bean on them as a record of what they like. Makes it so much easier to make a market that way because most have played along. HST, doesn't mean that most beaned coins aren't quality for the grade, because they are, but just keep it in perspective on why they do this. It is all about money.

 

Best, HT

 

 

Fair enough. PCGS/NGC and CAC are all in it to make money.

 

Manipulate the market? I take umbrage with that.

 

FYI- I wouldn't buy a gold coin without John's blessing as it's not in my wheelhouse. Coins in my series I'm comfortable with finding my own way.

 

Mark

 

Maybe manipulate is too strong a word, but no doubt CAC is doing this for the money, the collateral positives to the collector are what they are, the potential collateral negatives that have been discussed, are what they are as well. I agree with gold, they are good with it. They do miss however, I had a very rare, stunning pair of O mint half eagles from DWN that were identical in every possible way that I could tell after extended and very careful study of studying both. Sent it at different times, one beaned and one did not. The one that did not bean IMO, was slighty better for the grade than the one that did. No chance that the unbeaned one is a C coin for the grade as there are probably not another 20 that are original for that date and mintmark and there are around 80 extant. What I should have done is sent it back in with the beaned one so CAC could put them side by side, and then tell my why it was not an A coin, but no way a C..... Alas tho', the unbeaned one is now out of my collection, not financially feasible to keep it. Nevertheless, CAC is extremely hard, and thus good, on gold.

 

Best, HT

[James_OldeTowne]

I don't own any CAC coins, but I have certainly been looking for any that fit in my collections. The reason that I don't have any is that they go high. nuff said, I guess.

I haven't had to pay a premium for any stickered coin yet. They frequently can be found at the same price as un-stickered coins in my experience.

[jpcienkus]

I don't own any CAC coins, but I have certainly been looking for any that fit in my collections. The reason that I don't have any is that they go high. nuff said, I guess.

I haven't had to pay a premium for any stickered coin yet. They frequently can be found at the same price as un-stickered coins in my experience.

 

James, can you clarify your comments for me? Are you saying that "A & B" coins will garner a premium over the "C" coins in the grade whether they have the sticker or not so in your mind, you're not really paying a premium for the sticker, but for the coin itself? Or are you saying you just don't pay any premium for CAC coins?

 

My experience, which isn't as far reaching as yours, is that CAC'd coins bring a premium over not CAC'd coins. For example, If I see two like coins at an auction house and I judge them both to be "A" coins, the CAC'd coin typically brings a higher price.

 

I'm not a "slave" to CAC'd coins, but I do recognize what they bring to the table, especially when selling.

[Afterword]

How do you determine that someone is paying a premium for the CAC sticker and not for the quality of the coin itself?

[jpcienkus]

How do you determine that someone is paying a premium for the CAC sticker and not for the quality of the coin itself?

 

I'm not sure and that's why I was asking James for some clarification.

 

Edited to add:

Although, like I said in my earlier post, I've witnessed multiple "A" (in my opinion anyway) coins selling at the same time and the one with the CAC sticker typically sells for a higher price. Sometimes the spread is large and sometimes not.

[MarkFeld]

How do you determine that someone is paying a premium for the CAC sticker and not for the quality of the coin itself?

 

In the large majority of cases, you probably can't. But either way, if a CAC coin brings more than a non CAC coin, the buyer is paying a premium for the CAC coin. It's just that it might be due to the coin and not the CAC sticker.

[James_OldeTowne]

I don't own any CAC coins, but I have certainly been looking for any that fit in my collections. The reason that I don't have any is that they go high. nuff said, I guess.

I haven't had to pay a premium for any stickered coin yet. They frequently can be found at the same price as un-stickered coins in my experience.

 

James, can you clarify your comments for me? Are you saying that "A & B" coins will garner a premium over the "C" coins in the grade whether they have the sticker or not so in your mind, you're not really paying a premium for the sticker, but for the coin itself? Or are you saying you just don't pay any premium for CAC coins?

 

My experience, which isn't as far reaching as yours, is that CAC'd coins bring a premium over not CAC'd coins. For example, If I see two like coins at an auction house and I judge them both to be "A" coins, the CAC'd coin typically brings a higher price.

 

I'm not a "slave" to CAC'd coins, but I do recognize what they bring to the table, especially when selling.

You can easily scan through Heritage auction results for Morgan dollars (for example) on a specific grade and range, and find CAC examples that sold for a big premium over non-stickered coins, and CAC examples that sold for noticeably less than non-stickered examples.

 

I bought a CAC-stickered commem in MS-65 yesterday for $10 below BlueSheet!