NGCX 1 1

[GoldFinger1969]

On 11/23/2022 at 12:40 PM, Tyrock said:

Doesn't sound like a move in the right direction. Making things more complicated just as a new TPGS is coming out. Hey, at least Mike Mezack will have something new to hype.

This new system  is limited to modern coins, right ?

[gmarguli]

On 11/22/2022 at 7:43 PM, World Colonial said:

I agree, but the problem for actual collecting is decreasing affordability for the more typical collector.  To my recollection, I don't recall anyone else ever (not even once) bringing this up here or on any coin forum where I posted.  Most posters are lot more interested in a higher price level.

I believe common MS-63 and similar Morgan dollars are mostly owned in volume as "investments" by financially motivated buyers.  The coins are far too common to be mostly owned by set and type collectors or even as impulse purchases.

Concurrently, this is a "staple" coin of US collecting and I think it's important that coins like it remain affordable to most buyers.  "Affordable" is relative of course but my assumption is that at least 50% of the collector base has an annual budget of $500 or less. 

A noticeable percentage in this group probably do not own $100 coins.  Eliminating this and other similar coins as an option due to budget constraints will make collecting less interesting to them.

I'm not sure that collectors getting priced out of their series is a bad thing. It sounds healthy for the market. It means that there is more demand (more collectors) as part of the hobby. Those priced out of a series will likely look at a different series or world coins. 

The ultra common coins like MS63 Morgans are owned by clueless grandmas that bought them off the home shopping channels and the Sunday coupon section marketers. Do not underestimate the MASSIVE quantities of product these "dealers" move. 

[World Colonial]

On 11/23/2022 at 3:32 PM, gmarguli said:

I'm not sure that collectors getting priced out of their series is a bad thing. It sounds healthy for the market. It means that there is more demand (more collectors) as part of the hobby. Those priced out of a series will likely look at a different series or world coins. 

It depends upon someone's view of collecting.

Overwhelmingly, the sentiments I read both on coin forums and in the numismatic press is a preference for higher prices.  It's not even close and it's worse among the dealer community who pretends to be promoting the hobby when both common sense and their public sentiments better demonstrate it's irrelevant to them.  I can understand a desire by collectors to recover their cost (no one wants to lose money) but that's not what I infer.

I realize there is no "optimal" price level to satisfy everyone or even most.  Conversely, I don't see how further financializing collecting above what already exists can be considered a positive for the hobby, only for the business side.

If you are familiar with financial behavior, the evidence shows that prices in an "investment" market increase, it's more desirable.  Rising prices are "good" while falling prices are "bad".  This is the same sentiment I infer in financially motivated buyers toward coin collecting.

For goods and services, it's what the economic textbooks state.  Demand is inverse to price.  That's how I view collecting.  The more expensive a coin is, the less I want to buy it.  It's less desirable to me, not more.

That's why I don't collect most of the coins I initially did upon resuming collecting in 1998.  Everything is more expensive, but the prices don't reflect the merits as a collectible, in my subjective opinion.  This was the initial reason I didn't bother collecting any US coinage, as it's totally uncompetitive with world and ancients.

If I were to collect other coins in addition to those I do now, I'd be spending noticeable multiples of what the coins previously cost, usually hundreds and maybe thousands for something which should sell for nominal prices, except to those who believe that every "desirable" coin should sell for "noticeable" or "high" prices.  Cumulatively, this would be at least in the five figures for coins I don't really want.

There is also a limit to how far "downward" a collector is willing to go which everyone who I have ever read expressing your sentiments ignores.  The collector who is priced out of what they used to buy is supposed to find what they can still afford interesting, even though the one making this claim would never collect it as their primary interest.

[zadok]

On 11/23/2022 at 5:00 PM, World Colonial said:

It depends upon someone's view of collecting.

Overwhelmingly, the sentiments I read both on coin forums and in the numismatic press is a preference for higher prices.  It's not even close and it's worse among the dealer community who pretends to be promoting the hobby when both common sense and their public sentiments better demonstrate it's irrelevant to them.  I can understand a desire by collectors to recover their cost (no one wants to lose money) but that's not what I infer.

I realize there is no "optimal" price level to satisfy everyone or even most.  Conversely, I don't see how further financializing collecting above what already exists can be considered a positive for the hobby, only for the business side.

If you are familiar with financial behavior, the evidence shows that prices in an "investment" market increase, it's more desirable.  Rising prices are "good" while falling prices are "bad".  This is the same sentiment I infer in financially motivated buyers toward coin collecting.

For goods and services, it's what the economic textbooks state.  Demand is inverse to price.  That's how I view collecting.  The more expensive a coin is, the less I want to buy it.  It's less desirable to me, not more.

That's why I don't collect most of the coins I initially did upon resuming collecting in 1998.  Everything is more expensive, but the prices don't reflect the merits as a collectible, in my subjective opinion.  This was the initial reason I didn't bother collecting any US coinage, as it's totally uncompetitive with world and ancients.

If I were to collect other coins in addition to those I do now, I'd be spending noticeable multiples of what the coins previously cost, usually hundreds and maybe thousands for something which should sell for nominal prices, except to those who believe that every "desirable" coin should sell for "noticeable" or "high" prices.  Cumulatively, this would be at least in the five figures for coins I don't really want.

There is also a limit to how far "downward" a collector is willing to go which everyone who I have ever read expressing your sentiments ignores.  The collector who is priced out of what they used to buy is supposed to find what they can still afford interesting, even though the one making this claim would never collect it as their primary interest.

...demand is inverse to price? i guess thats one way to look at any market, however, coin collecting n especially auction records dont tend to support that premise..."if its too hot in the kitchen, then get out of the kitchen"...seems like a more accurate reflection of the present coin market....

[GoldFinger1969]

I don't know how you can define "getting priced out" like we are talking about San Francisco real estate and you're a middle-class worker making $100,000 a year who doesn't work for a tech company making 4x that amount.

Did coins get "priced out" in 1989-90 during the bubble when Wall Street dollars were coming in -- with more to come -- and MS-65 Saints sold for $3,500 and gold was at $400 ?  If a bunch of social media gazillionaires or crypto gurus (at least up to 6 months ago) had decided to put a few hundred million into coins/Saints, that would jack up the prices, no ?

Does our EC, Bob Simpson, and others drive up the prices on trophy coins ?  Does that drag upward the prices on 5 and 6-figure coins even if you don't buy 7-figure Saints ?  If the 5-figures go up, can that impact the 4-figure coins we swim in over time ?

When a commodity has limited supply, and demand increases, the only "fair" way to allocate is for the price to rise.

[World Colonial]

On 11/23/2022 at 6:01 PM, zadok said:

...demand is inverse to price? i guess thats one way to look at any market, however, coin collecting n especially auction records dont tend to support that premise..."if its too hot in the kitchen, then get out of the kitchen"...seems like a more accurate reflection of the present coin market....

I was attempting to draw an analogy but apparently not successfully.  I know that higher demand = higher price.  I'm not disputing that.

The buyer since the mid to late 70's and especially post TPG is a lot more affluent versus earlier buyers, so I assume more of them are willing to treat higher value purchases as a consumption expense.  This is an inference, not fact.

As an example, I infer that what I'd describe as common or very common coins with higher numbers on the TPG label are viewed as far more desirable primarily due to the price.  It's the most logical reason, since pre-70's collectors obviously didn't think of these coins the same way.

If these coins return to more closely reflect earlier relative prices, I expect collectors will change their perception, again.  Not all of these coins are bought explicitly as "investments" but the buyer would usually never pay this type of price without expecting to get most of their money back. 

Registry sets make a difference but no reason to believe it's important enough to more than a very low minority.  To most buyers, finishing first (or whatever) in a marketing competition doesn't offset losing much or most of your money.

[World Colonial]

On 11/23/2022 at 7:09 PM, GoldFinger1969 said:

I don't know how you can define "getting priced out" like we are talking about San Francisco real estate and you're a middle-class worker making $100,000 a year who doesn't work for a tech company making 4x that amount.

Did coins get "priced out" in 1989-90 during the bubble when Wall Street dollars were coming in -- with more to come -- and MS-65 Saints sold for $3,500 and gold was at $400 ?  If a bunch of social media gazillionaires or crypto gurus (at least up to 6 months ago) had decided to put a few hundred million into coins/Saints, that would jack up the prices, no ?

Does our EC, Bob Simpson, and others drive up the prices on trophy coins ?  Does that drag upward the prices on 5 and 6-figure coins even if you don't buy 7-figure Saints ?  If the 5-figures go up, can that impact the 4-figure coins we swim in over time ?

When a commodity has limited supply, and demand increases, the only "fair" way to allocate is for the price to rise.

Apples and oranges from my example in my opinion.

It's my inference that the majority of collectors don't expect to ever buy the types of coins in your post.  They could never afford to buy these coins and some who are able won't buy it anyway,  so it makes no difference to their collecting psychology if the price goes "through the roof".

This is different than being priced out of what I'd describe as "collector" coins.  This first happened at scale in the mid-70's.  You've seen the PCGS 3000 Index.

The point I was trying to make is that collectors who are accustomed to one level of collecting won't move endlessly down the food chain to collect something they find noticeably less appealing.  This varies by collector but believe it applies to most.  It's my inference that many collectors from the 60's quit collecting in the 70's for the reason I am giving you here,

[GoldFinger1969]

On 11/23/2022 at 7:09 PM, World Colonial said:

I was attempting to draw an analogy but apparently not successfully.  I know that higher demand = higher price.  I'm not disputing that. The buyer since the mid to late 70's and especially post TPG is a lot more affluent versus earlier buyers, so I assume more of them are willing to treat higher value purchases as a consumption expense.  This is an inference, not fact. As an example, I infer that what I'd describe as common or very common coins with higher numbers on the TPG label are viewed as far more desirable primarily due to the price.  It's the most logical reason, since pre-70's collectors obviously didn't think of these coins the same way. f these coins return to more closely reflect earlier relative prices, I expect collectors will change their perception, again.  Not all of these coins are bought explicitly as "investments" but the buyer would usually never pay this type of price without expecting to get most of their money back. Registry sets make a difference but no reason to believe it's important enough to more than a very low minority.  To most buyers, finishing first (or whatever) in a marketing competition doesn't offset losing much or most of your money.

I think SLOWLY or GRADUALLY rising prices -- since most of us have done lots of buying ALREADY -- is not necessarily a bad thing.  You don't want the coin hobby to resemble 1989-90 or the NFT craze...but you don't want investor enthusiasm to go the way of stamp collectors, either.  A happy medium is best, I guess.

Since many/most of us have no intention of selling, even if we are 90% done with our major buying we don't care if the future buying buoys our assets, we are just concerned it'll drive up the prices on the 10% of coins we still need.

I guess our heirs or estate will benefit, huh !!  

[GoldFinger1969]

On 11/23/2022 at 7:32 PM, World Colonial said:

 It's my inference that many collectors from the 60's quit collecting in the 70's for the reason I am giving you here,

But that was a legit shock in terms of price and sentiment.  Prices SKYROCKETED in 10 years...it was one giant bubble....subject to legal restrictions, you could buy Saints for about $70 which then cost 5x as much 5 years or so later and 20x as high in 10 years.  You had lots of people with sticker shock who couldn't see paying 5-10x what they had laying flat for years or decades in price.

Even small denomination penny/nickel/quarter/half dollar/other coin types had great appreciation, even aside from silver and gold coin types.

Edited November 24, 2022 by GoldFinger1969

[World Colonial]

On 11/23/2022 at 7:36 PM, GoldFinger1969 said:

I think SLOWLY or GRADUALLY rising prices -- since most of us have done lots of buying ALREADY -- is not necessarily a bad thing.  You don't want the coin hobby to resemble 1989-90 or the NFT craze...but you don't want investor enthusiasm to go the way of stamp collectors, either.  A happy medium is best, I guess.

 

Yes, I agree this is best.

Concurrently, I still consider the prices of many mostly US coins far too high, for the collectible merits where these should be more affordable to "mainstream collectors".

[World Colonial]

On 11/23/2022 at 7:41 PM, GoldFinger1969 said:

But that was a legit shock in terms of price and sentiment.  Prices SKYROCKETED in 10 years...it was one giant bubble....subject to legal restrictions, you could buy Saints for about $70 which then cost 5x as much 5 years or so later and 20x as high in 10 years.  You had lots of people with sticker shock who couldn't see paying 5-10x what they had laying flat for years or decades in price.

Even small denomination penny/nickel/quarter/half dollar/other coin types had great appreciation, even aside from silver and gold coin types.

That's not going to repeat but the increases in many coins have been "noticeable" in the last two years, per the examples I gave earlier.

[GoldFinger1969]

On 11/23/2022 at 8:43 PM, World Colonial said:

Yes, I agree this is best.

Concurrently, I still consider the prices of many mostly US coins far too high, for the collectible merits where these should be more affordable to "mainstream collectors".

The PCGS 3000 was in a 10-12 year bear market and then appeared to bottom in late-2019/early-2020.

Wouldn't you agree that we finally declined enough and are ripe for a rebound ?  U.S.-specific collections like Franklins were down 60-75% from a decade ago.

[VKurtB]

On 11/23/2022 at 12:20 PM, GoldFinger1969 said:

This new system  is limited to modern coins, right ?

For now, yes. 

[Henri Charriere]

On 11/23/2022 at 9:42 PM, VKurtB said:

For now, yes. 

[Chomping at the bit, eh?]  

[gmarguli]

On 11/23/2022 at 4:32 PM, World Colonial said:

It's my inference that the majority of collectors don't expect to ever buy the types of coins in your post.  They could never afford to buy these coins and some who are able won't buy it anyway,  so it makes no difference to their collecting psychology if the price goes "through the roof".

This is different than being priced out of what I'd describe as "collector" coins.  This first happened at scale in the mid-70's.  You've seen the PCGS 3000 Index.

The point I was trying to make is that collectors who are accustomed to one level of collecting won't move endlessly down the food chain to collect something they find noticeably less appealing.  This varies by collector but believe it applies to most.  It's my inference that many collectors from the 60's quit collecting in the 70's for the reason I am giving you here,

Are you considering the coins in the PCGS3000 "collector coins"?  I suspect that 1/3 of the coins in that list are flat out unapproachable for the vast majority of collectors. Another 1/3 are only available to well heeled collectors.

I'd like to see the list stripped of the unrealistic coins and account for inflation and see what the return looks like for real collector coins. I suspect it is much less than it is right now. 

[GoldFinger1969]

On 11/23/2022 at 9:48 PM, gmarguli said:

Are you considering the coins in the PCGS3000 "collector coins"?  I suspect that 1/3 of the coins in that list are flat out unapproachable for the vast majority of collectors. Another 1/3 are only available to well heeled collectors.

I'd like to see the list stripped of the unrealistic coins and account for inflation and see what the return looks like for real collector coins. I suspect it is much less than it is right now. 

Which coins are you largely referrring to there, Gmarg ?

FWIW, I think focusing on the subsectors of the PCGS 3000 is more relevant.  The 3000 is just way too broad.

[World Colonial]

On 11/23/2022 at 9:48 PM, gmarguli said:

Are you considering the coins in the PCGS3000 "collector coins"?  I suspect that 1/3 of the coins in that list are flat out unapproachable for the vast majority of collectors. Another 1/3 are only available to well heeled collectors.

I'd like to see the list stripped of the unrealistic coins and account for inflation and see what the return looks like for real collector coins. I suspect it is much less than it is right now. 

No, not just in the higher or highest grades. I'm referring to the coins generically.

I'm also aware that a noticeable proportion of US coinage (broadly defined) has never been affordable to most collectors, probably 80% at least. This includes most gold, practically all patterns, maybe 50% of colonials, maybe at least half of  19th century proofs, many early copper up to 1814, and most silver up to 1807.

It depends upon someone's criteria of "affordable" which can include the proportion of the collector base and assumptions of minimal acceptable quality.

As an arbitrary cut-off, I'd categorize any coin that is potentially bought by 80% of the collector base as "mass affordable".  You might have a different one.

I'm also aware that with the larger number of affluent buyers (both income and net worth), one within reach of 10,000 might be considered "affordable" even if it costs in the low to high five digits.

Comparisons over time depend upon the start and end date with the opportunity to retro fit the outcome.

I'm aware of regular collector grade coins like capped bust halves (in the early 70s to more recent times) and early large cents (late 70's to more recently) with substantial decreased affordability.

Since I don't know anyone else's financial position in specifics, I tend to use myself as a benchmark.  I'm far from rich but have done far better than the median since 1998 (when I resumed collecting) but since I virtually never use savings to buy coins, income wise I can probably buy less from the US coinage I would conceivably buy and far less in world coinage.

[EagleRJO]

I checked in on this thread to see what people were saying about the new NGCX grading scale, and there are pages with virtually nothing to do with the new scale.  Who hijacked Mike's thread?

[Henri Charriere]

On 11/23/2022 at 11:22 PM, EagleRJO said:

I checked in on this thread to see what people were saying about the new NGCX grading scale, and there are pages with virtually nothing to do with the new scale.  Who hijacked Mike's thread?

I don't know that it was done wilfully or maliciously.  Sometimes the answers come hard and fast in the beginning, and flatten out after a number of people weigh in.  In a sense, the OP assumes the role of moderating posts and the thrusts that occur which may lead off to tangents. For me, a member spoke for me as his thought coincided with mine.  The new scale with have no effect on me.  I am done. What effect the new scale may have on others remains to be seen.  I see the age of the collector and the coins sought as being factors.

[EagleRJO]

I was just curious/joking.  I think it's interesting because it could effect everyone eventually if it does carry over to coins other than modern bullion issue.  And random boxes of bullion coins?  Offf.

Edited November 24, 2022 by EagleRJO

[GoldFinger1969]

On 11/23/2022 at 11:56 PM, EagleRJO said:

I was just curious/joking.  I think it's interesting because it could effect everyone eventually if it does carry over to coins other than modern bullion issue.  And random boxes of bullion coins?  Offf.

I think we were discussing lots of stuff tangental but related to the NGCX rollout:  state of the hobby, investment opportunties, new coin collectors, moderns and classics, etc.

Until we see the actual NGCX product and activity, I don't think there's that much to talk about or even speculate.  Which probably explains why we went off on somewhat different but loosely-tied topics to the NGCX product.

Edited November 24, 2022 by GoldFinger1969

[World Colonial]

If it's permanently limited to 1982 and later coinage and succeeds, it's predominantly going to increase the number of NCLT buyers.  That's really about it.  It's irrelevant to anyone who doesn't collect NCLT and nothing to say.  

It's very unlikely to substantially increase the number (absolutely or proportionately) buying US or world circulating coinage dated after 1982.  This is evident from the existing TPG population data and there is no basis to believe a change in grading scale is going to alter it.  Why would it?

On the other hand, if the longer-term intent (my opinion) is to test acceptance for a new grading scale and this succeeds, it's potentially financially relevant to the vast majority of US based collectors with a "meaningful investment" in their collection.

That's why I took this thread off-topic, though it did veer off further afield, again.

[GoldFinger1969]

On 11/24/2022 at 11:03 AM, World Colonial said:

If it's permanently limited to 1982 and later coinage and succeeds, it's predominantly going to increase the number of NCLT buyers.  That's really about it.  It's irrelevant to anyone who doesn't collect NCLT and nothing to say.  

It's very unlikely to substantially increase the number (absolutely or proportionately) buying US or world circulating coinage dated after 1982.  This is evident from the existing TPG population data and there is no basis to believe a change in grading scale is going to alter it.  Why would it? On the other hand, if the longer-term intent (my opinion) is to test acceptance for a new grading scale and this succeeds, it's potentially financially relevant to the vast majority of US based collectors with a "meaningful investment" in their collection. That's why I took this thread off-topic, though it did veer off further afield, again.

Again...and I admit it's a SMALL PERCENTAGE of people...but if you get them interested in NCLT via this NGCX system, it can lead to people being exposed to other stuff that they then might take an interest in.  Maybe it rekindles stuff they did as kids...maybe it's something new.

The first non-bullion gold coin I ever bought was the 2009 Ultra High Relief Saint-Gaudens recreation.  Once I got it, I started reading about all the other pre-1933 Gold Coin options out there....and here I am today. 

 

[GoldFinger1969]

BTW, I would also note that on modern submissions you already have a differentiated grading system of sorts....for bulk grading, you sometimes get a general description like "GEM MINT" rather than an actual number.  I have that designation on some of my Saint-Gaudens commemoratives.  It means the coin is at least a 65, and maybe a 66.  Not sure how many 67's and above it would represent as you would think that if you can get a 67-70 grade it would mean more $$$ and why leave that on the table.

I don't know if they ever use "SUPERB GEM MINT" to signify 67 and above.

[VKurtB]

On 11/23/2022 at 8:48 PM, Quintus Arrius said:

[Chomping at the bit, eh?]  

Hardly. Between not being interested in having moderns graded, with precious few exceptions, and likely not having enough senile years to fall prey to marketing hype, I’m feeling okay with where I am. This whole NGCX thing is all about one, and only one, thing - trying to give the big wholesalers a bigger sucker market for graded U.S. modern coins. 

Edited November 24, 2022 by VKurtB

[gmarguli]

On 11/23/2022 at 7:03 PM, GoldFinger1969 said:

Which coins are you largely referrring to there, Gmarg ?

FWIW, I think focusing on the subsectors of the PCGS 3000 is more relevant.  The 3000 is just way too broad.

In the PCGS3000:

Unapproachable: Chain/Wreath 1c in UNC, numerous key dates in near gem/gem, 1792 Half Disme in MS63/64, most early coinage they have listed in MS63-65, key date gold, proof gold, etc. The reality is that the vast number of collectors will never be able to afford any coin that costs anything near these levels. These are dream coins and they shouldn't be used to judge the health of the market. 

Well Heeled: Contains tons of $5K-$50K coins. Median income in US is around $45K and household around $65K. A significant portion of collectors will never be able to afford these and many that do buy at this level may only buy one or two to complete a set. 

I don't know the weight (if any) put on each coin, but I'd much rather have an index like this heavily weighted upon the coins that frequently trade and lightly weighted on the coins that come up for auction once a year. It'd give a much better representation of the whole market.

[EagleRJO]

Looks like the NGCX scale is intended for "modern" bullion and circulating coins since 1982.  What's so significant about the 1982 date other than the change in composition for the cent?  I have heard it argued that 1934 and later is a pretty good dividing line for "modern" circulating coins.

[gmarguli]

On 11/24/2022 at 1:04 PM, EagleRJO said:

Looks like the NGCX scale is intended for "modern" bullion and circulating coins since 1982.  What's so significant about the 1982 date other than the change in composition for the cent?  I have heard it argued that 1934 and later is a pretty good dividing line for "modern" circulating coins.

My great great grandfather used to say 1865 was the start of modern coinage... 

There is no real reason. Different TPGs have called 1970 the modern cutoff. And also 1965. And 1955. 

1982 is as good as any other date as that was the start of the so-called modern commemorative era. 

[Henri Charriere]

FWIW:  The French 20-franc gold rooster (an early form of gold bullion with a gold content of less than a fifth of a troy ounce) has always been recognized as a Modern World Gold Coin.  They were minted from 1899 to 1914.

[GoldFinger1969]

On 11/24/2022 at 1:16 PM, VKurtB said:

Hardly. Between not being interested in having moderns graded, with precious few exceptions, and likely not having enough senile years to fall prey to marketing hype, I’m feeling okay with where I am. This whole NGCX thing is all about one, and only one, thing - trying to give the big wholesalers a bigger sucker market for graded U.S. modern coins. 

Suckers is a bit too harsh.  Suckers is folks believing in crypto like some relatives who I found out today had 5-figures in the stuff. 

No gold, but $30,000 in BitCoin.  Unreal. 

I'll be working on him. 

Edited November 25, 2022 by GoldFinger1969