For me, CAC is becoming a detriment to the hobby.

[BillJones]

As I thought things over last night and then read the pro CAC commentary this week's "Coin Dealer Newsletter" I've started to think that CAC is becoming a detriment to the hobby, least for me.

 

Years ago I spent a few thousand dollars to get all of the major and second tier coins that were in my collection certified. It was necessary because the market had moved to the point where raw coins were going to be numismatic dodo birds no matter how nice or rare they were.

 

Over the next several years I bought certified coins almost exclusively for my collection. I did that because getting raw coins certified is a tough business for a collector. As dealer I learned that you could do well by getting coins certified because when you sent in a lot of coins, you quite often got some grades on the high side that you didn't figure to get. You also got some lower than expected grades and body bags, but overall, the certification game is a winner if you are a dealer who knows how to grade coins and buy them right.

 

For the collector it's a different story. Collectors usually have far fewer coins, and if one of their important items comes back with a lower than expected grade, or worse yet a "details" grade, it's often hard for them to recover financially. That's why I recommend that collectors should buy coins in the holders they want in the first place.

 

Now along comes CAC, and they have changed the game. Now having your coins certified is not enough. Now they must the have the CAC seal of approval, and furthermore, for a large number of CAC adherents, those coins MUST be graded by PCGS as well. Everything else, as one poster ATS put it, is "raw."

 

So now to hold the value of your collection you have send all of your nice coins to CAC. In my case that will involve an expenditure of many thousands of dollars because of the shipping and insurance charges. That's money that could be used to buy more coins and books, where much of the fun for this hobby is for me. It money that I could use to travel and broaden my experiences. But to stay in the game that money ends up spent at the post office and the CAC grading house.

 

The whole thing gets depressing, and it should make anyone who might want to get into this hobby, especially for investment, think twice. You could build a great collection only to find that you must send you coins to one man to have them accepted so that they can hold their value. Today it is CAC; tomorrow it might be something else.

 

I'm not saying negative things about John Albanese. I have never met the man personally. I have only talked to him over the phone. He seems like an honest, unassuming individual who means no one any harm, but my main concern and criticism is that no one man should be able to exert that much power over a market. When one man does, it makes me wonder if I really want to have that much money in that market.

 

So that's where I am. I love my coins, and I'd like to keep collecting, but given the current state of market with so few people in control of it, how far am I willing to go?

 

One solution is simply move away from U.S. coins and let the market makers do their thing. Their loud, distasteful rhetoric, combined with the personal attacks from the people here and ATS, is ruining the hobby for me. I don't have much interest in what they are selling and never did have much interest it. Coins in ultra high grades, with marginal overall rarity and limited historical appeal have never done much for me. But what I fear is that these people will ruin the rest market for those of us who don't want to play their game, and that's sad; but it seems like that the direction we in which we are heading.

 

[RWB]

Bravo! Here, here!

[brg5658]

Bill, well said. And, sadly, a true assessment of the current US coin market.

 

 

[Mr.Mcknowitall]

As I thought things over last night and then read the pro CAC commentary this week's "Coin Dealer Newsletter" I've started to think that CAC is becoming a detriment to the hobby, least for me.

 

Years ago I spent a few thousand dollars to get all of the major and second tier coins that were in my collection certified. It was necessary because the market had moved to the point where raw coins were going to be numismatic dodo birds no matter how nice or rare they were.

 

Over the next several years I bought certified coins almost exclusively for my collection. I did that because getting raw coins certified is a tough business for a collector. As dealer I learned that you could do well by getting coins certified because when you sent in a lot of coins, you quite often got some grades on the high side that you didn't figure to get. You also got some lower than expected grades and body bags, but overall, the certification game is a winner if you are a dealer who knows how to grade coins and buy them right.

 

For the collector it's a different story. Collectors usually have far fewer coins, and if one of their important items comes back with a lower than expected grade, or worse yet a "details" grade, it's often hard for them to recover financially. That's why I recommend that collectors should buy coins in the holders they want in the first place.

 

Now along comes CAC, and they have changed the game. Now having your coins certified is not enough. Now they must the have the CAC seal of approval, and furthermore, for a large number of CAC adherents, those coins MUST be graded by PCGS as well. Everything else, as one poster ATS put it, is "raw."

 

So now to hold the value of your collection you have send all of your nice coins to CAC. In my case that will involve an expenditure of many thousands of dollars because of the shipping and insurance charges. That's money that could be used to buy more coins and books, where much of the fun for this hobby is for me. It money that I could use to travel and broaden my experiences. But to stay in the game that money ends up spent at the post office and the CAC grading house.

 

The whole thing gets depressing, and it should make anyone who might want to get into this hobby, especially for investment, think twice. You could build a great collection only to find that you must send you coins to one man to have them accepted so that they can hold their value. Today it is CAC; tomorrow it might be something else.

 

I'm not saying negative things about John Albanese. I have never met the man personally. I have only talked to him over the phone. He seems like an honest, unassuming individual who means no one any harm, but my main concern and criticism is that no one man should be able to exert that much power over a market. When one man does, it makes me wonder if I really want to have that much money in that market.

 

So that's where I am. I love my coins, and I'd like to keep collecting, but given the current state of market with so few people in control of it, how far am I willing to go?

 

One solution is simply move away from U.S. coins and let the market makers do their thing. Their loud, distasteful rhetoric, combined with the personal attacks from the people here and ATS, is ruining the hobby for me. I don't have much interest in what they are selling and never did have much interest it. Coins in ultra high grades, with marginal overall rarity and limited historical appeal have never done much for me. But what I fear is that these people will ruin the rest market for those of us who don't want to play their game, and that's sad; but it seems like that the direction we in which we are heading.

 

What is the market that is being ruined? The personal investment Market? The low coin cost Market? The Hobby market?

 

A person has choices.

[KeyMan64]

I understand where you are coming from and certainly can appreciate the frustration but a couple of things have been left out here.

 

For a collection that you built over decades...

Raw was originally fine

Then it moved to slabbed coins being fine so you got them holdered and protected and more easily valued for insurance.

Then came CAC

Then there was the big move 4+ years ago when things went to PLUS GRADING so if you really wanted to keep up, everything needed to go back in or at least the stuff that you thought was really strong for the current assigned grade. For most though this is a cost prohibitive step....fees, shipping, insurance etc.

 

Then if you have IHC you also might want to get the Eagle Eye Photo Seal too!

 

In regards to the CAC effort costing you thousands, I disagree with that claim. From Tampa International Airport to New Jersey, a flight can be had for just a couple hundred dollars. A taxi isn't too expensive then you could visit the sticker company in person in the early morning, drop the coins off, go eat lunch, pick the coins back up and then fly home. I have heard of people doing this. I think the fee for the coins that sticker is $12.50 and that's it. Granted, I could understand a person being risk adverse and not wanting to do this...but dealers fly with their stuff all the time.

 

On another note, who cares about the stickers now, if you are not selling NOW. This is not an expense you even have to look at! Just ignore it. It can be important when selling though and that is why people do it. I have done it! I have not had to fly anywhere either. The auction house I use will send the coins to CAC for me for FREE! I only get charged for the stickers! That is dirt cheap! No packaging, mailing, insurance additional headaches....

 

As for you going through the expense of getting your coins in HOLDERS, darn near the same thing applies. You could have enjoyed them raw and saved yourself a TON of money. It really matters when it comes time to sell. With the auction house I use, I can ship them things raw, they will get them slabbed for me at a great discount to me sending them in on my own and I am not charged for shipping.insurance or anything like that...just the discounted TPG fees. You could have saved a lot of money with this route as well and been able to take advantage of plus grading star grading or whatever else is out when it is time for you to sell.

 

So it seems that some of your frustration might be with the choices you have made, could have made or get worked up over making from all of the fine forum folk that swear that ONLY ONE THING IS RIGHT. Everyone has to find their own balance and comfort level with the choices available. There are plenty of ways to save a TON of money in this game...and there are plenty of ways to WASTE a ton of money. I think I have identified the most conservative ways to enjoy the hobby while still being able to maximize profits when I sell things.

 

Good luck.

[e1cnr]

CAC doesn't affect me, they don't even touch most of the coins I like. So I guess I have a different view of 'the hobby' than you.

[World Colonial]

What is the market that is being ruined? The personal investment Market? The low coin cost Market? The Hobby market?

 

A person has choices.

 

How about the market for the US coins that most collectors prefer? This shoud be apparent from the coins Bill has profiled in his prior posts which he owns.

 

The whole CAC business, its never going to be relevant to most collectors because the coins they collect aren't in "elite" condition or "rare" and aren't ever going to sell for a lot of money anyway.

 

As for choices, you are right, but most collectors who can choose otherwise don't view the coins which are implied in your response as their preferred option. You weren't specific and I don't know what you collect but I already know they aren't at or even near the top of the preference scale because for those that are, what Bill described seems to be the way a lot of collectors are also likely to believe.

[Raisethis2]

Bill,

 

I tend to take an entirely different view. When something I own gets a bean I'm exceptionally pleased that it's a coin I selected that turned out not only to be eyecatching to me, but also passes muster with CAC's rigorous grading standards.

 

If something doesn't get a bean I don't like it any less, I just keep it because I like it.

 

I agree, when the day comes for me or my heirs to sell. It's going to be hard for anyone to think it's going to be a bargain, great, eye appealing coins won't be cheap.

 

The whole "gotta be PCGS, gotta have a bean" mentality is clearly self serving. Anyone who says that either has a good percentage of inventory with those features or wants to charge out the wazooo for the coins they do have with those features.

 

Anyone who believes that drivel has convinced themselves that they are an investor only and have lost sight of the fact that this is still someone's hobby. Hold a raw AU 58 spot free 1855 Large Cent and tell me this coin is unacceptable because it's not encapsulated ATS with a bean .

 

Only a liar would be in such denial to be indifferent to the history it represents.

 

 

[wdrob]

Wow Bill, You are my new hero!!!!

 

Well I have always thought a lot of you anyway but you just took four steps up the ladder to the top.

 

More and more people will eventually open their eyes and do as I do. When I see a coin with CAC, or any other sticker on it -- I move right on along.

 

So all those CAC nuts out here, you lose a good bit of money from me, and maybe others, just for having that sticker on your slabbed coin.

 

 

 

[BillJones]

I don't move along when I see a coin with a CAC sticker on it. If I like the piece, I'll buy it if I think the price fair. For me the CAC sticker comes along for the ride. I don't go to shows with the goal of buying CAC approved coins.

 

When the service was introduced, CAC had an influence on my buying. But after a couple of pieces turned out not to be what they were trumpeted to be I stepped back. I thought that CAC might provide a way to help sort through auction lots when you could not see them in person. That was a misconception on my part. You still need to look at the lots or have someone you trust look at them.

 

[Kurtdog]

no one man should be able to exert that much power over a market.

He started NGC and PCGS, didn't he? Or did I not hear that right?

[BillJones]

no one man should be able to exert that much power over a market.

He started NGC and PCGS, didn't he? Or did I not hear that right?

 

Yes, he was one of the founding partners of both. Now it seems that he has a measure veto power over both of them.

[coinman_23885]

Except for the very tip top of the market, I do not think the coin market is very healthy at all at the moment. To that end, I see CAC as incredibly beneficial as it adds liquidity and provides a quick buyer that typically makes offers that are among the highest if not the highest. In many cases, I have received far more than I would have had I auctioned the materials and allowed an auction house to eat up a good portion of my return. I also typically receive a check in the mail within 2-3 days. And I think many areas of the coin market are suffering right now. I have little doubt that coins that are stickered would suffer with the rest of the market if it weren't for CAC. At least for coins that are stickered, CAC's presence as a strong market maker is helping to keep the prices from plummeting as quickly as I believe the rest of the material in some of the segments of the market is already doing.

 

Now with regards to pricing, I also think CAC helps many high end pieces. Collectors routinely rely on auction records, and it seems that many collectors will blindly look at auction records without actually pulling the listings to look at the quality of the coins being sold. I have seen this happen several times. In the end, several poor quality pieces will hit the market and collectors who blindly look at auction records will under estimate the true value of a quality piece. This can result in reduced auction bids and an artificial depression in value for higher end pieces. So I think in that sense CAC is also beneficial.

 

On a final note, if you are buying coins and holding them for a collection, I am not sure why you would care about having CAC stickers on pieces that you already own, so you don't need to spend thousands of dollars in insurance and stickers. Just hold the coins and enjoy them for what they are without regards to value and marketing and what not. And as for value and marketing considerations, the only time it should seemingly matter (to me anyway) is when it is acquired and when you liquidate the piece.

 

Also, and this one isn't directed at the OP but at market participants, I also don't understand the CAC only mantra or in the case of some posters here, the no-CAC at all mantra. Neither makes sense as you are overlooking great coins. For me at least, it is the QUALITY of the coin and the price that matters. If these align, I'll buy it whether it is CACed or not. I'll also buy it whether it is raw or certified.

 

[coinman_23885]

And on one last note, I still don't think CAC has been around long enough (less than 8 years I believe) to fully understand the long term consequences of its existence. Insofar as there might be any negative effects, I think it is important to note that it is not from CAC but rather the over reliance by market participants on the sticker. And over reliance on third parties because of lack of knowledge is nothing new in the coin market; this has been an issue since the advent of the TPGs. Years ago, collectors could think for themselves but many do not today. While it can be negative in some senses, there is no real way to eradicate it other than through education (and good luck with that, sadly)! And I think the advantages of having CAC or even the TPGs, for that matter, outweigh the negative.

[Kurtdog]

no one man should be able to exert that much power over a market.

He started NGC and PCGS, didn't he? Or did I not hear that right?

 

Yes, he was one of the founding partners of both. Now it seems that he has a measure veto power over both of them.

One might even say this secondary grading racket is his vision.

[MJ]

I'm lazy. I'll just cut and paste my reply from ATS.

 

[Q]A true collector doesn't care about transitory changes in value of one's collection. Buy what you like and worry about all that when it comes time to sell.[/Q]

 

^^^^^^^^^^^

 

This.

 

I was totally against CAC in the beginning. Like always I reserved the right to change my mind which I did.

 

I've never sent a coin to CAC. I will one day perhaps. I have a ton of pre CAC coins that have never been to New Jersey.

 

Most of the coins I have bought the past few years have come with stickers. Mostly because the handful of dealers I buy from have PCGS/CAC ladened inventories.

 

I have bought a few coins recently without stickers that haven't been to CAC yet. The fact they weren't stickered never came into play.

 

If the market stays the same as it is now when I go to sell all my NGC coins will take a trip to Cali and NJ. If it changes I will adjust to the market at that time. Until then I'm not so worried about it. In fact I don't worry about it at all.

 

This coin I bought from Bill Shamhart. He had just bought the coin. It wasn't stickered. I didn't even think to ask him if it would sticker. The irony is that he is a CAC "grader" and a commem specialist and I didn't even ask him. Why? it didn't matter in this purchase. The coin was coming home with me. I trust my judgement and I trust my dealer. I've enjoyed the coin very much. The coin is not jealous of his fellow coins in the box he resides in that have stickers. They get along fine.

 

Mark

 

[MarkFeld]

Mark, that Hawaiian looks gorgeous. (thumbs u

[mommam17]

Bill-7 years talking about how much money it will cost you to get your coins to CAC. Now, you are getting depressed and talking about collecting foreign coins. I think it is taking a toll on you. Hope you are Ok.......

[Tyrock]

I think you made some good points Bill. When I started collecting ANACS was the answer to collector security (of course it wasn't for many reasons). Then PCGS and NGC came along. They still weren't the complete answer as the coin in the slab wasn't graded in a manner that took into account strike, luster and eye appeal. Many unknowledgeable collectors bought some dreck. Now the answer is PCGS coins with a CAC sticker. I'll just keep buying NGC or PCGS coins with good luster, strike and eye appeal. If I like the coin I'm happy with it, but the hobby sure is changing. And I'm sure there's more to come.

[Walkerfan]

I think you made some good points Bill. I'll just keep buying NGC or PCGS coins with good luster, strike and eye appeal. If I like the coin I'm happy with it, but the hobby sure is changing. And I'm sure there's more to come.

 

This

 

Sticker or no sticker-----I'll worry about market dynamics and all that nonsense, when the time comes.

[MarkVIIIMarc]

As a newb I have a love/hate relationshio with the grading companies. I LOVE that they can tell me a coin is authentic. I HATE that they suck soo much of our money out of the hobby. Figure my entire, yup entire, Morgan and Peace dollar collection is worth less than the submission fees the fellow in the "downgraded" thread paid.

 

Seems quaint to let them determine the value of your coin past a certification of authenticity. What is the fun of buying a pre valued graded coin.

 

Maybe the grading services and our seemingly growing reliance on them is a reflection of how many coins change hands via non face to coin transactions on line now.

[jpcienkus]

I think you made some good points Bill. I'll just keep buying NGC or PCGS coins with good luster, strike and eye appeal. If I like the coin I'm happy with it, but the hobby sure is changing. And I'm sure there's more to come.

 

This

 

Sticker or no sticker-----I'll worry about market dynamics and all that nonsense, when the time comes.

 

I agree with you. I don't worry about CAC when buying the coin. I've bought many with the CAC sticker, many without and passed on many with the CAC sticker as well.

 

I have been in the process of submitting my coins to CAC as more of an insurance when and if I do sell the coin.

 

After reading your response, I had a thought. I know the market doesn't consider ANACS to be the TPG they once were at their inception. People will still buy/look at ANACS coins in white holders, but after that, they lost all credibility. Could this very thing also happen to a company like CAC? What happens if they lose all their current market credibility?

[World Colonial]

I think you made some good points Bill. I'll just keep buying NGC or PCGS coins with good luster, strike and eye appeal. If I like the coin I'm happy with it, but the hobby sure is changing. And I'm sure there's more to come.

 

This

 

Sticker or no sticker-----I'll worry about market dynamics and all that nonsense, when the time comes.

 

I agree with you. I don't worry about CAC when buying the coin. I've bought many with the CAC sticker, many without and passed on many with the CAC sticker as well.

 

I have been in the process of submitting my coins to CAC as more of an insurance when and if I do sell the coin.

 

Yes, but I think one of the original points was about the purchase of what most of us would consider to be very expensive coins under the then existing quality and market standards and then finding out later that they have changed and your coins are worth (a lot) less money.

 

Many of these responses are discussing what is in place now and I understand the point. At the same time, my entire collection is worth about the same as Bill's Draped Bust/Small Eagle reverse half dollar and I have only paid more than $1000 four times, including twice in the last year. I suspect this is true of most who post here and they aren't buying coins in the same price range Bill buys.

 

I have bought many coins cheaply in the past which I either sold or are now worth a lot more (and a few the other way), but I think it is completely unreasonable to expect people to treat their outlay as a consumption expense no matter how much they like collecting when they have a "substantial" outlay. To give you an example in my series, I don't prioritize South Africa Union or ZAR anymore because the coins cost so much more than they did earlier and I cannot buy them cheaply anymore either. I now buy something else such as the pillars which I believe are better coins anyway

 

I know this comment is not popular but I am going to make it anyway because I consider it undeniably true. I believe that most who claim they "buy the coin" are honest when they say, but at the same time, they are (over) confident that they are mostly going to get most, all or even more of their money back at resale. Because if this were not true, I see no possibility whatsoever that so many collectors would buy what they do now at anywhere near the current prices they pay. It defies common sense.

 

Collectors didn't remotely think most of the coins which are disucssed on this forum (or PCGS) are worth what they are now in the past, even adjusting for price changes, income and wealth or relative to other coins. The only reason they do now is because of the price structure and the predominant reason they are willing to pay them is because others are also willing to do it and they expect that this will continue in the future until it is time to sell.

 

I can assure you that if the current market dynamics differed as they did in the past prior to TPG, CAC, registry sets and the buying of coins as "investments", the behaviour of the lopsided proportion of collectors on this forum and in general would differ radically. It does everywhere else now where these attributes aren't in place and it would in the US also.

[BillJones]

I have purchased a number of coins over the years at prices that were higher than what I ever hoped to recoup. A lot of collectors do that. Oddly over the years, the market has caught up with those prices, and I'd now be able to sell those pieces as at a profit. That's what I called a by-product of the hobby. Still I agree with World Colonial that most of us collect coins, tokens and medals with the expectation we will be able to re-sell them for some amount that is similar to what we paid. I don't view coin collecting to be like my model railroad hobby. In that pursuit I KNOW that every dollar I spend on it is gone.

 

What really burns me up now is that a group of people want a system where ONE MAN has a huge influence on the value of EVERY U.S. coin series he chooses to evaluate. And since some of the people who support CAC want to place a stigma on coins that don't have stickers, that affects the value of those pieces too.

 

In closing I'd like you take a look at this Barber Quarter graded PR-67, CAC from ATS. I think that it falls short of the grade on the holder, but you decide. To me PR-67 means you have look darn hard at the piece to find any imperfections. The marks or whatever they in the right obverse field and on Ms. Liberty's neck tell me that this piece is not a PR-67.

 

1892 Barber Quarter

[BROADSTRUCK]

I'm curious what CAC's Warranty is as of right now since I couldn't find anything on their website

 

Since PCGS & NGC no longer offer a warranty just beyond being genuine & properly graded, so will CAC buy back every single freshly third party graded coin they sticker that turns after it leaves their office

[BillJones]

I'm curious what CAC's Warranty is as of right now since I couldn't find anything on their website

 

Since PCGS & NGC no longer offer a warranty just beyond being genuine & properly graded, so will CAC buy back every single freshly third party graded coin they sticker that turns after it leaves their office

 

From what I understand their "warranty" is that there are a group of the dealers who are willing to buy their approved coins sight unseen. The question is at what prices? One person said that they were paying Gray Sheet "bid" for some series. As a former dealer, I can tell that if I liked a certified classic coin, I was almost always willing to pay at least Gray Sheet "bid" for it so that is hardly an earth shaking offer.

 

Maybe some of CAC's friends can expand upon the amounts that the CAC dealer network is willing to pay.

 

[Nutmeg Coin]

Now that you have come "out of the closet" as opposed to the CAC trend, are you at all worried Bill that you could have "problems" with submissions to them on their guarantees, or other repercussions etc.?

[JVC]

For me there are pros and cons to CAC. I feel as if I now pay more for the coins I purchase because of CAC. It seems as if a substantial number of coins with a value of $1,000,00 or more have already been submitted to CAC. If am purchasing an A or B coin in this price range, most will have a CAC sticker and I will pay more for it. I realize that nice coins often sell for premiums, but before CAC the difference in price was not so clear cut.

 

 

[World Colonial]

I have purchased a number of coins over the years at prices that were higher than what I ever hoped to recoup. A lot of collectors do that. Oddly over the years, the market has caught up with those prices, and I'd now be able to sell those pieces as at a profit. That's what I called a by-product of the hobby. 1892 Barber Quarter

 

I believe it is a combination of individual preference and perspective. I am hardly "rich" but if my coin collection suddenly became worthless tomorrow, it won't make any difference to my finances. My retirement doesn't depend upon it, I only buy coins I can comfortably afford and I have never put myself in a position (or ever will ) where I will ever depend upon the proceeds of selling a coin for any purpose.

 

I don't believe most others here do either but I concurrently understand from prior polls that more than a few are disproportionately "overweight" in coins financially.

 

I have also paid more for coins on occassion than they are worth and I knew it, presumably for the same reason you did; because I wanted them and the piece was really hard to find. If it works out financially, that is fine and if it doesn't that is fine also.

[BillJones]

Now that you have come "out of the closet" as opposed to the CAC trend, are you at all worried Bill that you could have "problems" with submissions to them on their guarantees, or other repercussions etc.?

 

My coins will only be submitted to CAC if the auction house that handles my collection believes it would be to my financial advantage.

 

As for "coming out of the closet" people who have read my posts know that I have had issues with CAC's consistency all along. Just look at the PR-67 Barber quarter for which I created a link. I have seen many other disappointing examples.

 

My problem now stems from the fact that CAC''s cheerleaders are now dumping on the coins that don't have the sticker. As John Albanese said at the launching of CAC, it was NOT his intent to do that, but now his minions are doing it.

 

I have a concern about early coins, which are almost never "perfect," getting caught up in this. My hope is that the collectors who admire these pieces will not be concerned about the presence or absence of a sticker. They will simply take the nature of these coins into account and bid accordingly.

 

It is interesting to note that CAC is no longer involved with pre Federal, so called "colonial" coinage. That is another area where the coins are seldom "perfect" for the grade poses challenges for anyone who would like to have a CAC like service for them. It is well that CAC has withdrawn from that area.