fraud, slabs, and the truth about the hobby today
dorkkarl
Posts: 12,691 ✭✭✭
so, all you need to succeed today in business today is a computer, a phone line, and a good imagination. if you look at all the fraud that has occurred this year, what with enron, world-comm, adelphia, and all the news you hear constantly about fraudulent on-line selling, i wonder what kind of social and economic environment we are setting up for our kids (and BTW i have 2).
35 years ago, if you wanted to buy coins, you had to drive (or walk if you were a bubble-gum-faced 13 y.o. kid) over to the local coin store, get to know the owner personally and work on a relationship over the course of many weeks, months or even years. even now, there are still coin dealers that i still work with after dozens of years, Jack Beymer, Bowers and Merena (used to be Ruddy and Bowers), Stack;s, Jakes, etc etc. not to mention the other local fellas in Chicago.
today, all you need is an email address, a p.o. box, a website and certified coins, and your good to go. coins get flipped around left and right, and thousands or 10's of thousands of $ are spent every day on coins sold on the internet to someone who has never actually SEEN the coin in person, but who knows it has a slabbed grade or a good story behind it, and that's it. i call it the "heritage" mentality.
but in reading through these forum threads, there is so often a common element of how much we hate slabs (guilty), how much we despise bogus stories (guilty), how much we decry the inflated prices of common coins (guilty) and how much the hobby has become a booming business where what matters more than the coins is your marketing strategy (guilty).
is this what the hobby has become? didn't the enjoyment used to come from pulling a chair up to a musty old box of coins, picking them up and looking through them one by one, and seeing which ones just might fill those holes in your blue whitman folder? maybe i am old fashioned and this is just wishful thinking, but i gotta say that i just don't see this anymore. when i go to shows, all i see are rows and rows of glass cases filled with countless stacks of plastic slabs and "dealers" standing around with greysheets and bluesheets. and on the internet, the most exciting aspect of buying coins might just be the stories that people make up about little old ladies and grandpa's bathtubs full of unsearched wheat pennies. you talk to most any one of the dealers at a show today, and the only thing they know is that the piece of plastic has a number printed on it, and that number has a column listing in the greysheet, and that leads to a price. the old-time dealers are dying out fast, the ones who could actually discuss die varieties, and the minting process, and how coins are hubbed, and the history behind a certain choice coin.
i'm not going to point any fingers, and i'm not gonna name names, because franklky, i've bought a he11uva lot myself off the internet in the last 5 years or so. but think about all the fraud and nonsense that goes on. is it possible, friends, just possible that the real culprits are WE OURSELVES, the idiots who are willing to spew out gobs of cash for a slabbed grade, or a convincing story, or a glitzy website, that we just saw 5 seconds ago and gotta buy right now???
"heritage" mentality my foot. some heritage.
K S
35 years ago, if you wanted to buy coins, you had to drive (or walk if you were a bubble-gum-faced 13 y.o. kid) over to the local coin store, get to know the owner personally and work on a relationship over the course of many weeks, months or even years. even now, there are still coin dealers that i still work with after dozens of years, Jack Beymer, Bowers and Merena (used to be Ruddy and Bowers), Stack;s, Jakes, etc etc. not to mention the other local fellas in Chicago.
today, all you need is an email address, a p.o. box, a website and certified coins, and your good to go. coins get flipped around left and right, and thousands or 10's of thousands of $ are spent every day on coins sold on the internet to someone who has never actually SEEN the coin in person, but who knows it has a slabbed grade or a good story behind it, and that's it. i call it the "heritage" mentality.
but in reading through these forum threads, there is so often a common element of how much we hate slabs (guilty), how much we despise bogus stories (guilty), how much we decry the inflated prices of common coins (guilty) and how much the hobby has become a booming business where what matters more than the coins is your marketing strategy (guilty).
is this what the hobby has become? didn't the enjoyment used to come from pulling a chair up to a musty old box of coins, picking them up and looking through them one by one, and seeing which ones just might fill those holes in your blue whitman folder? maybe i am old fashioned and this is just wishful thinking, but i gotta say that i just don't see this anymore. when i go to shows, all i see are rows and rows of glass cases filled with countless stacks of plastic slabs and "dealers" standing around with greysheets and bluesheets. and on the internet, the most exciting aspect of buying coins might just be the stories that people make up about little old ladies and grandpa's bathtubs full of unsearched wheat pennies. you talk to most any one of the dealers at a show today, and the only thing they know is that the piece of plastic has a number printed on it, and that number has a column listing in the greysheet, and that leads to a price. the old-time dealers are dying out fast, the ones who could actually discuss die varieties, and the minting process, and how coins are hubbed, and the history behind a certain choice coin.
i'm not going to point any fingers, and i'm not gonna name names, because franklky, i've bought a he11uva lot myself off the internet in the last 5 years or so. but think about all the fraud and nonsense that goes on. is it possible, friends, just possible that the real culprits are WE OURSELVES, the idiots who are willing to spew out gobs of cash for a slabbed grade, or a convincing story, or a glitzy website, that we just saw 5 seconds ago and gotta buy right now???
"heritage" mentality my foot. some heritage.
K S
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Comments
Pogo?
No, I think you have the opposite. As a kid it was hard to find a coinshop within riding distance, although I did. Yes, the dealer I dealt with was very kind to me and I still have coins from him. But now we have the internet and can more easily find coins we are interested in instead of having to "settle" for something else. I have bought way too many cleaned, overgraded, etc coins in my days and am very frustrated that when the time to sell to a dealer, he would offer only $0.10 on the dollar, even after keeping it for twenty years. Today, with slabs, you get a guaranty on the coin's grade and most folks will accept that grade as close enough. No more buying a MS-63 and having a dealer say it is a slider. Today, you can browse for just about any coin you'd want (except affordable PCGS graded bust coins) on the internet. I"ve never been screwed or screwed anyone. If a coin is not what you want, just send it back. Now, today, you get the anticipation of the U.S. mail everyday on what package might come for you. Today, we can meet other collectors and "converse" with them over the internet where in years gone by you would be hard pressed to find other people to talk to. Me, I'm happy the way it is today compared with many years ago.
Tom
Some good points to ponder. I do agree that the internet has had a dramatic impact on the hobby, due in part to third party grading. I am also guilty of buying coins through the internet and I now buy mostly slabbed coins. When I started (about 30 years ago) I had my share of blue whitman folders and filled the slots. Now that I have more money and knowledge I tend to go for the best quality and best eye appeal that I can afford and that generally dictates that I go to slabville.
For the new collectors I do feel there is a loss in not having a mentor or local dealer that truly knows coins to help groom and educate the young collectors. We have a generation that can't tell the difference between a AU55 and a MS61. I hate the price inflation and people just collecting for the numbers and not taking into the beauty of the coin. Within the last year my internet activity has dropped dramatically and I have built alot of great relationships with several dealers who know coins and who I can talk to for hours on the coins (e.g. Angel Dee's, Whitlow, RCNH etc).
I actually think alot of collectors on this board have greatly helped the general public by watching the Ebays/Yahoo Auctions and posting the bogus nature of the auctions. This has helped cancel some auctions and alert Ebay et al (for what good its worth). Like anything you need to be informed about what your buying. Be it a dot com, a telecom or a ACG graded coin if you don't do your homework you will get fryed in the end. I've spent hundreds on books and I feel like I know what I'm doing and I am happy with the collection I've established. Be it foolishness or brilliance who knows, just as long as your happy with what you have.
Rich
<< <i>Me, I'm happy the way it is today compared with many years ago >>
it's good to hear an opposing point of view. i just fear that while computers might make it "easier and faster" to buy coins, it's also much easier to commit fraud today and be gone tomorrow. and the instant-gratification that slabs offer plays right into it. i guess that's what i'm trying to say.
I also enjoy finding coins with the metal detector, although I believe it may be awhile before I find a slabbed coin with the detector. If this were to happen, I suspect it would be an ACG slabbed coin. Just my opinion.
Obscurum per obscurius
at least if you EXAMINE the actual coin in person, you have no one to blame (or take credit) but yourself. i think its about taking responsibility, and not just shipping responsibility off to pcgs.
K S
I live in a metro area of over 1 million and within two weeks my selection of coins (Barber Halves in midgrade F-XF) was gone. I found 4 or 5 nice original dates and most everything else has come from different parts of the country via the internet that I never would have found otherwise. Sure I have been bent over and paddled on a few transactions, but have wisened up to 99% of the deceit and understand many of the con games out there. Now I buy only from reputable sellers, do not buy unless the coin has a large, clear scan and a return policy is in place.
Scanning many coins myself for re-sell I have come to learn how circulated coins look when scanned, I recognize what hairlines and cleaned coins look like in a scan and many different nuances. Sometimes I think part of the fun is trying to decipher a scan and seeing how the coin looks when I recieve it in the mail. I don't recommend this often as it will result in a lousy coin more often than naught.
You made many excellent points though.
Tyler
If you are buying sight-unseen, make sure the seller has a reasonable return policy.
Obscurum per obscurius
K S
jom
However as Tom mentioned, you always got screwed whenever you sold a coin. Your BU was an Unc., the Unc. a slider, even when you sold the coin back to the dealer from whom you made the original purchase.
Importantly, the amount of knowledge available from the internet and these forums was not available back then. A lot was hit or miss. I paid $75 for a 1931 D BU dime. The strike & luster was excellent, but there was a noticeable hairline scratch on Miss Liberty's face that was grade limiting, and 30 years later, I sold the coin for $50. If I had known about lighting back then, I would have caught this. OTOH, I bought a BU 36S Walker for $35. I sent it to PCGS 2X, and it is now in a 6 holder, where it belongs.
This knowledge is why coin collecting is IMO much healthier now. At present, the issue is whether or not people use this knowledge. How many times do you buy a coin without looking at it with a glass under a lamp?
How many times to you buy a raw coin, sight unseen?
The slabs are a starting point; that's all. You know the coin is not counterfeit, and in effect you have an insurance policy if the grading services did a major screw up. However, this is not an excuse not to know how to grade a particular coin that interests you.
IMO, the big money is made right now by dealers selling slabs to people who are more concerned with pop reports and the number on the slab rather than the actual coin itself. I'm guessing that between 10-5% of coins are incorrectly graded by PCGS and NGC. That's not counting the really ugly technically graded coins of ten years ago, and the numerous changes of grading standards we've seen in the last 15 years.
You see this all of the time at large auctions. Attractive coins for the grade, but not PQ, bring huge prices, because someone told a dealer "I want this particular piece of plastic." Superior just sold a PCGS RB 6 Braided Hair Large Cent for $1,495. It's a solid 6, but it's in an old holder and is 15% RD. If it was graded today, it would be in a 6 BN holder. I have BN Large Cents that have more RD in them than this RB coin. Someone paid RB $ for a BN coin because he / she wanted the slab.
And there is the crack-out issue. While some people make big $ doing this, the real winners are the grading services.
As far as E-Bay is concerned, understand that you are buying coins sight unseen. If you have a seven day no questions asked return privilege on a particular coin, fine. But it is no different from buying a coin from an ad in Coin World 30 years ago.
"Seu cabra da peste,
"Sou Mangueira......."
It's my opinion that things are better now for everyone than they've ever been. Third party grading, eBay, overnight mail, PayPal, MESSAGE BOARDS!....
Unfortunately for the fool, he and his money can part faster now than ever before, thanks to a 24 hour digital coin show going on right now called eBay and the internet. Fraud? It'll never go away.
Fortunately, for the well-off non-fool, he has WAY more opportunities than he used to ("I think I'll spend the next four hours looking at the inventories of Heritage, Pinnacle, Legend, Whitlow.......go over to ArtR's site and weep with coin envy.....go to the PCGS bulletin board and see if someone's calling me a "sheister"....again....check my auctions..........) and the market is far more competitive than it has ever been. Nowadays, there are fewer barriers to entry than ever. And you know what? You can thank David Hall for PCGS and Al Gore for the internet. David Hall must be an ok dude. I've never met him but he has a bulletin board where people can meet to swap stuff.....and cut him out of the deal!
Certification is one of the biggest boons to the coin collecting fraternity ever. EVER! And it happened in your life time. I watched it happen in coins in the mid 1980's. And now it's happening all over again in the grading of rare US currency. Currency dealers saw how it hurt many of the coin dealers and they do not want certification heading their way. Go check it out. Get a subscription to Bank Note Reporter. Truth is, certification cuts the profits on each sale but goes a long way to making items more fungible, which is good because it increases the number of transactions! To those dealers who couldn't make it, well it's adapt or die, baby!
The question of whether things are better now or not is a Rorschach test...gettin ripped off? What are you doing wrong??? Havin' a blast? Must be doing something right!
Can even careful people get screwed? Yup. Ealier this year I bought a Liberty Cap Cent, PCGS AU58...off eBay....with problems that didn't show up on the scan. He had a well articulated return policy, a good eBay rating but the refund check bounced......twice. Now, 5,000 bucks may not be a lot of money to you, but I was ready to fly to Florida and wait by his PO box to check out the fit between my right and his windpipe. I got my money back but it was like pulling teeth.
So, when you meet a dealer that treats you right and sells what fires your neurons, and doesn't try to talk you into keeping something you don't want, be nice to him! Don't shave him for every last cent. Who knows, maybe he'll offer something to you first if you make your contacts with him pleasant...that's how I get my stuff...I treat my contacts right...I count on them...I don't want to be away from my family EVERY weekend at some coin show!
In the negotiation/law business we have a motto. "No one wants to give money to an jerk." You can be firm in your dealings but don't assume that every dealer is just trying to rip you off. I think that most dealers are just turbo collectors that risked everything to pursue their passion.
I hate it when you see my post before I can edit the spelling.
Always looking for nice type coins
my local dealer
How true. One local dealer charged me less on a coin than I told him I'd pay for it, and it was a very scarce (one of two known, but others may exist) coin that I couldn't get anywhere else. He gives me discounts and first shot on coins he knows I like. I know I've paid a little more for a few coins that I could have gotten for less elsewhere, but I've realized a substantial net savings and got nice coins I couldn't find without his help. He's made me into a loyal customer.
Obscurum per obscurius
The beauty is, what we have now- all the positive aspects of this hobby, we didn't have five, ten years ago.
The good you had as a kid? You still have that today.
No matter how "modern" we get at coin shows and conventions, I still see many Dealers lugging in all the raw coins and albums of type!
It's a great collecting community!
peacockcoins
i just wonder if the HOBBY is better off. in my book, the 2 are different.
K S
has taken today. The old world was basically a one on one
learning experience the old fashioned way through digging
a lot of your collection out of circulation, coin date, learning
the mintages in the Red Book by heart, the coin shop in the
department store, and getting ripped off more than
you do today. Buying an expensive raw coin then could be a
a big gamble. The nostalgia is missed.
Today's world of slabbing has enabled me to buy rarities on eBay I would
have never seen at a local show. A local dealer would never
have found them for me either. You can feel a lot better
buying a big ticket item today. I can live with it and have
combined the best of both worlds.
- Charlie B -
My website
And far easier for a collector willing to put forth the effort to recoup more of his money when selling. A collector can sell an esoteric $50 coin -- to a nationwide audience of other collectors -- for a couple bucks in fees to eBay without any dealer involved. Pretty remarkable when you think about it. How much could a local dealer afford to give you for some weird $50 coin that he might have to hold for a year?
The grading services are in many ways a game collectors are forced to play in some cases, and their fees certainly take money out of the hobby, but I think on balance the savings to the collector community far outweigh those fees. Better to give $1 million to grading companies than $5 million to unscrupulous dealers selling cleaned junk.
If you wan't to feel sorry for someone, it's the poor dealers.
Anybody that buys into "little old ladies and grandpa's bathtubs full of unsearched wheat pennies" are probably the same people that buy their wristwatches from shifty eyed crackheads with bloodshot eyes at the bus station in DC. You know the one that hangs out by the bathroom and says psst you wanna buy a watch?
I once paid $7,000 for a 67 Stone Mountain. I still have a Stone Mountain. It's a PCGS 64. I love it. I look at it almost everyday.
I couldn't be happier with the way the coin market is right now. I've got my scars from lessons learned. A drawer full of woulda' coulda' shoulda. I have access to beautiful coins every day at prices I can afford. And I no longer wonder whether I'm a collector or an investor. I collect coins. Some people have said to me "Ah, you're a numismatist." My stock answer is "just because I have house plants doesn't make me a botanist." I know a little something about something. But, the bottom line is certain coins "get my neurons firing" and I like the way the hobby and market is developing.
PS: Willkommen, muenzen!
PPS: ...sorry, Anaconda!!....
"Ask, and it shall be given you; seek, and ye shall find; knock, and it shall be opened unto you." -Luke 11:9
"Hear, O Israel: The LORD our God is one LORD: And thou shalt love the LORD thy God with all thine heart, and with all thy soul, and with all thy might." -Deut. 6:4-5
"For the LORD is our judge, the LORD is our lawgiver, the LORD is our king; He will save us." -Isaiah 33:22
but you see, you've brought up an extremely important point, one i've mentioned before. another reason why i prefer unslabbed coins is i mainly collect coins struck without a collar, and there are THREE sides to those coins. therefore, 1/3 of such a coin can never be viewed if its in plastic.
and your right, looking at a coin through a clear plastic lens is nothign like seeing it up close and personal. if you've ever cracked an old old coin with super luster, it looks 10 times better in the free air.
K S
jom
The internet is a source of incredible information, but also has the worst you can find also(porn, bad organizations, etc).
Ebay has become the E-Store of the future. The overhead is low, the profit potential is high, and credit cards make the transaction faster than you can say, super-cowla-fradga-listic-expee-ala-dough-shus!
I personally think that I have access to coins, I couldn't possible get ahold of around my small town area. I learn fairly quick, when money is involved, and am careful, check the normal safety precausions, and buy what I can afford(or a little more than I should
Robert
one thing is certain, you'd have to drag me fighting all the way back to the good old days, cause hindsight being 20-20, they weren't that good!! crooks, fraud and all that goes with it are always going to be a part of any endeavor that involves money. that's just a simple fact of human nature.
al h.
For the Morgan collectors - The Morgan and Peace encyclopedia by Van Allen and Mallis
What would your slabbed coins be worth if the grading services went out of business? What would your coins be worth if the Internet was taken offline for good?
For the Morgan collectors - The Morgan and Peace encyclopedia by Van Allen and Mallis
What would your slabbed coins be worth if the grading services went out of business? What would your coins be worth if the Internet was taken offline for good?
I don't have much to add other than, like the Pentium chip, the speed in which we learn our lessons seems to double every 6 months now. I miss the human touch of the pre-cyber age and often wonder what "progress" really means. At the same time I'm addicted to the limitless potential of technology and value the friends I've made in places like this.
Love your use of "heritage" as an adjective!
<< <i>The internet is a source of incredible information >>
the key point here is: is there information, or more MISinformation on the web?
most important of all, depending on what you choose to believe, is there a difference???
K S