Registries Driving High-Grades to Abnormally High Prices?

[astrostu]

Dunno if this has been brought up before, but I'm curious to know what folks think about this. Personally, I'm not a fan of registry sets because I think that they are driving the market for MS/PF-69 and -70 coins abnormally high, with HUGE premiums for a slip of paper that says that such-and-such company thinks the coin is flawless or nearly so. I guess it boils down to the "buy the coin not the slab" mentality, but I was wond'ring what people though about the actual prices. To me, at this point in my collecting, there's no way I'd pay 50x for a coin marked MS-70 from a coin marked MS-67.

[James_OldeTowne]

This is much of the reason why PCGS coins supposedly "sell for more". In my opinion, PCGS controls the population of coins that are permitted to achieve the 70 level - not by the grade itself, but through political motivation. By artificially limiting the allowed supply, that causes the price of their "70"s to be driven to levels that are unrealistic and unwarranted to someone who cares nothing about "registries".

 

In other words, I think PCGS grades so few 70s - not because they are rare, but because they want to limit how many are available. That's what I refer to as "political grading".

[BillJones]

This is much of the reason why PCGS coins supposedly "sell for more". In my opinion, PCGS controls the population of coins that are permitted to achieve the 70 level - not by the grade itself, but through political motivation. By artificially limiting the allowed supply, that causes the price of their "70"s to be driven to levels that are unrealistic and unwarranted to someone who cares nothing about "registries".

 

In other words, I think PCGS grades so few 70s - not because they are rare, but because they want to limit how many are available. That's what I refer to as "political grading".

 

Thank you!!!!

 

I've been saying this for years across the street. I'm surprised I was not officially banished with the others when they give a bunch of people a "Christmas present" last December.

[cladking]

Perhaps some of this stuff is semantics almost as much as a real difference of opinion but it appears to me that grading companies respond to demand far more than they create it. Each has their own niche which they try to protect and enlarge by consistency and responding to changing demand. The major graders certainly know who their customers are and who their ultimate customers are. The "off brand" graders just pander to their immediate customer at the expense of their reputation.

 

Collectors are well advised to know a little about the graders as well as the grading if they are buying slabbed coins. This can apply just as much to MS-60 coins in some cases as it does to MS-70 coins.

[JRocco]

Perhaps some of this stuff is semantics almost as much as a real difference of opinion but it appears to me that grading companies respond to demand far more than they create it. Each has their own niche which they try to protect and enlarge by consistency and responding to changing demand. The major graders certainly know who their customers are and who their ultimate customers are. The "off brand" graders just pander to their immediate customer at the expense of their reputation.

 

Collectors are well advised to know a little about the graders as well as the grading if they are buying slabbed coins. This can apply just as much to MS-60 coins in some cases as it does to MS-70 coins.

 

Well said

[Zoins]

The other part of it is lots of disposable income

[Tradedollarnut]

This is much of the reason why PCGS coins supposedly "sell for more". In my opinion, PCGS controls the population of coins that are permitted to achieve the 70 level - not by the grade itself, but through political motivation. By artificially limiting the allowed supply, that causes the price of their "70"s to be driven to levels that are unrealistic and unwarranted to someone who cares nothing about "registries".

 

In other words, I think PCGS grades so few 70s - not because they are rare, but because they want to limit how many are available. That's what I refer to as "political grading".

 

I actually agree with this to an extent and think that NGC's way of handling it is much better. By being more liberal with the 70 grade, the resultant prices are much more realistic between grades.

 

But then again, I'm not much for grade differences that can only be seen with a strong glass...

[astrostu]

So now that it seems that most responders agree with me, I have a second, follow-up question: Would it be going to far to say that this MS/PF-70 registry set stuff is a fad and the bottom will fall out in a few years?

[michael]

 

 

This is much of the reason why PCGS coins supposedly "sell for more". In my opinion, PCGS controls the population of coins that are permitted to achieve the 70 level - not by the grade itself, but through political motivation. By artificially limiting the allowed supply, that causes the price of their "70"s to be driven to levels that are unrealistic and unwarranted to someone who cares nothing about "registries".

 

In other words, I think PCGS grades so few 70s - not because they are rare, but because they want to limit how many are available. That's what I refer to as "political grading".

 

could'nt have said the above any better

 

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I actually agree with this to an extent and think that NGC's way of handling it is much better. By being more liberal with the 70 grade, the resultant prices are much more realistic between grades.

 

But then again, I'm not much for grade differences that can only be seen with a strong glass... truer words have not been spoken

[michael]

buy coins or even plastic and tags you like

 

with discretionary income money you can afford to lose

 

and then if and when you realize you want to get out of the mindset with buying tags and plastic then you got to stick it to someone else.......... not a win win in my minds eye as with musical chairs many will be left standing

 

better to not even start and just buy a coin on its originality and eye appeal and scarcity something you want to keep and collect were the demand and value is most all in the coin all by its lonesome

 

if not that is okie then you got many sleepless nights and you might have to turn around and stick it to someone else

 

no thanks from me...... but everyoine is different

 

buy what you like with discretionary money

 

and have fun with your plastic and tags

[cladking]

So now that it seems that most responders agree with me, I have a second, follow-up question: Would it be going to far to say that this MS/PF-70 registry set stuff is a fad and the bottom will fall out in a few years?

 

Yes and no.

 

It has been conventional hobby wisdom for thirty years to buy the best you can afford etc, etc. Prices for different levels of quality have increased to levels which were simply unimaginable back in the 1960's. Some desirable old classics have barely increased in very low grade while the high grade are hundreds of times greater in high grade. This effect can be even greater in later coins.

 

It seems improbable this trend can increase a great deal more before the pendulum starts swinging back the other way but there are differences now which will are likely to preserve some of the pressure on quality. Quality has always been a concern for collectors but in modern times there are the graders to identify the quality and the internet to find them. It's likely that at some indefinite point the market will split somewhat and the multiples will drop in many places. This might be largely the result of the better coins in lower grades increasing much more sharply than the other grades. It's unlikely to occur across the board.

[Dcoin]

I think hunting for MS/PF 70 it’s just a different collecting style. The same way I don’t really appreciate looking at certain die-cracks on a Morgan, yet for VAMers this is their definition of coin collecting. Finding the perfectly graded coins is just another way to collect...even if some don't see what the big deal is.

[Zoins]

I think hunting for MS/PF 70 it’s just a different collecting style. The same way I don’t really appreciate looking at certain die-cracks on a Morgan, yet for VAMers this is their definition of coin collecting. Finding the perfectly graded coins is just another way to collect...even if some don't see what the big deal is.

Interesting comparison. I wonder if all PCGS 69s have some kind of flaw that can be seen under strong glass. If the numbers of PCGS 70s are politically motivated and NGC's % of 69s vs 70s is more inline with reality, then there should be many flawless PCGS 69s....

[James_OldeTowne]

Perhaps some of this stuff is semantics almost as much as a real difference of opinion but it appears to me that grading companies respond to demand far more than they create it.

I think this is much truer of NGC than of PCGS. PCGS almost by definition is "creating" demand with their exclusionary registry set. If you want to participate, then you have no choice but to purchase coins in their holders. NGC allows others' into their registry, albeit they are not completely open, as they still exclude ANACS and ICG.

 

I simply find it extremely difficult to believe that demand for certified coins is so strong that twenty million (or whatever the number may be) have been certified. I think rather they are certifying millions of coins in order to create demand for them.

 

So now that it seems that most responders agree with me, I have a second, follow-up question: Would it be going to far to say that this MS/PF-70 registry set stuff is a fad and the bottom will fall out in a few years?

I don't think so. I think that assuming the companies #1 stay in business, and #2 don't suddenly change their grading philosophy drastically, folks will likely continue to enjoy collecting registry sets.

 

Registry sets have absolutely no appeal to me whatsoever, but I fully respect those folks who enjoy such collecting.

[Zoins]

PCGS almost by definition is "creating" demand with their exclusionary registry set. If you want to participate, then you have no choice but to purchase coins in their holders. NGC allows others' into their registry, albeit they are not completely open, as they still exclude ANACS and ICG.

Just to clarify, if PCGS is choosing which TPGs to allow from a marketing perspective, NGC may be doing the same thing. It might be based on pecking order. Right now PCGS is seen as the top dog from a exclusivity perspective so they only need to allow themselves. There are enough people that only care about PCGS plastic to make this viable. NGC is in second place. There are fewer people who seek to exclusively collect NGC than those than seek to exclusively collect PCGS. If NGC didn't allow PCGS slabs in their registry, their regristry would most likely fail to attract many users. Because PCGS is higher on the pecking order, NGC allows PCGS in their registry but does not allow TPGs that are lower on the pecking order such as ANACS and ICG. So the NGC registry is still exclusive but with the caveat that it is open where market conditions require it to be.

 

This would be no different than the pecking order for 70 criticism. PCGS hands out the fewest 70s so PCGS supporters criticize NGC for handing out lots of 70s. NGC seems to hand out fewer 70s than ICG so NGC supporters criticize ICG for handing out lots of 70s.

 

As you go down in the pecking order people get less exclusive. It's just human nature. For the upper echelon the same thing happens with social clubs and golf clubs. People at the top, most exclusive social club in town criticize lower ones for being more lax on entrance requirements (new money vs. old money) and for having shorter wait lists (think years and decades). People in the lower social club criticize social clubs even lower on the pecking order. And so on and so on.

 

Yes the NGC registry is more open than the PCGS registry but it may only be because they are lower on the pecking order and are required to be more open to attract users. Seen from the other side the NGC registry is as exclusive as market conditions allow. Being exclusive is just how human nature and the marketing that takes advantage of it work.

[Zoins]

The previous post was about the NGC registry being as exclusive as market conditions allow. This may or may not be one of the reasons behind what NGC includes and does not include.

 

The other side of this is that the NGC registry may be as inclusive as market conditions allow. For one registry to allow an external TPG into their registry, the external TPG must have a way for allowing the registry to verify slabs. NGC and PCGS have cert verification websites. If ANACS and ICG do not have cert verification websites (I haven't found any) then their slabs simply cannot be included in another organization's registry, even if it was desirable.