Should the coin business be regulated?

DesertLizard

I say an emphatic NO*!


*What should be regulated is disclosure. Who are you dealing with? What is their background? What is "fair" pricing? What is investment grade? Etc.

One of the most regulated businesses in the U.S. is the securities business. If you are a convicted felon [or file for bankruptcy] you can not hold a license to do any securities business. Heck, you can be a convicted felon and still practice medicine, law [unless disbarred], accounting, engineering, architecture and even coin "investing". You can even hold a Congressional seat! Maybe someone can dig up the stat, a while back I saw a piece on how many congressmen were convicted for everything from grand theft to manslaughter and were still in office.

Two dealer friends have told me of other dealers who get coins on credit in hopes of "flipping" them for a quick sale then avoid the initial dealer when they cannot pay. Some knowingly write bum checks hoping to buy time to find a buyer for their wares. Also lots of other games. I wonder how they treat buyers?

Anyone know of the guy who had clients send coins to his home?! Yep, instead of sending in to the dealer / auctioneer the seller of the coins sent it to the employee's home who then sold the coins I believe to support his gambling habit. I don't recall how he got caught or if he made restitution but this stuff does happen. Maybe someone can fill in?

Time for Uncle Sam to step in with a big stick? NO**!

**Well maybe.

Russ

The problem with government regulation is that it frequently goes too far and ends up hurting far more people (consumers) than it helps. The more control we hand over to politicians and bureaucrats, the less control we have in our own lives.

I'd rather take my chances in the free market than have Nanny Fed decide for me what level of risk I should assume.

Russ, NCNE

braddick

If your answer is "Yes", then who do you suggest do the regulating? I know- maybe we can get the same group of fellas who are in charge of airport security.

Bulldog

I for one say "NO". Govt. regulates enough of our everyday life. I personally have 12 family members in Federal prison for tearing off the tags on their matresses......Dang I miss them.

Bulldog

danglen

NOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO!!!!!!!!!!!!!!

DCAMFranklin

Oh ya, let's create yet ANOTHER federal bureaucracy with even more employees NOT contributing to our Social Security system. I don't think so!

DesertLizard

*What should be regulated is disclosure. Who are you dealing with? What is their background? What is "fair" pricing? What is investment grade? Etc.

Would this be sufficient?

No one like red tape and buracracy.

However, when we are ripped off, see dishonest dealings & falsehoods, etc. we are quick to "hire a lawyer" or ask for the FTC to investigate. We usually don't like the end result. We are told there is nothing they can do as there are "no laws covering the behavior" or "it's improper but not illegal". What to do?

I am not leaning one way or the other, there is no easy solution. Some people have as much equity in their coins as in their homes, I would think they would want some reassurances. Even minimal ones like proper disclosure.

Russ

<< <i>However, when we are ripped off >>



When we are ripped off it's usually because of our own greed, ignorance, laziness or a combination of these.

Russ, NCNE

dragon

Regarding the problem of cheap counterfeit "Cuban made" cigars being sold by all the con men on the streets of Havana to tourists who wouldn't know the difference........the chief of police was asked why they didn't work harder to go after these people and prosecute and clean up the problem. His response was "if we did that, 3/4 of the population of Havana would be in jail"

does that answer your question about regulating the coin business??



dragon

DHeath

I think the guy working at the Newport Beach post office was regulated when he stole the best AH Dcam Kennedy I have ever seen. Yes, it needs to be regulated, but no, it shouldn't be.

ccr

No. People are cheated because they want to be cheated. Thats why the more experienced collectors here ( in which I`m not one of them ) suggest for us inexperienced ones to do. Such as learning to grade for our selves, buy books about counterfieting, asking the more experienced ones questions etc... I don`t know if there is a sure fire way to keep from being ripped off, and I have a few times in my life of course, it`s just that I don`t think any goverment can regulate against that. "That" being human nature.

DesertLizard

Would anyone knowingly do business with someone who was convicted of defrauding others? <Rhetorical question>

If the answer is "no", how would you know unless there was a mandatory disclosure of one's past?

If the answer is "yes", then you provide a way to be ripped off.

A potential solution is self governance like a PNG but many seem to believe they are toothless and membership is not required. What does one do? One bad apple does spoil it for many.

JD

The industry should be self-regulated especially in regards to the grading services.

It can be argued that the grading services are similar to investment analysts in that they make recommendations regarding the 'grading' (i.e. marketable strength, relative value, credit worthiness, etc). of a coin which has an impact on it's marketability and price.

GDJMSP

How can anyone - who has watched the changing gradings standards - at all of the grading companies and including those of the ANA - over the years - say we don't need some sort of regulation ??

I agree completely that it should not be government regulation. But regulation is definitely needed. And it would not be that hard to do it within the industry itself.

BSqr

Just say No to biggger and more intrusive government

DesertLizard

The silence from the dealers on CU on this issue is deafening.

All I am asking for is opinions, not like this is ever going to happen!

Maybe someone from a Southern CA firm can speak up? But not all at once!

mr3holesinone

Hmmm, many issues coming up here.

I'd like to suggest a regulating 'Grading Committee' be created with members of the numismatic community of course making this group up. Regulating may be too strong of a word, how about we call it a committee and have the ANA govern membership? The function of this new body would be to try to keep a level grading standards among the major grading services for an extended period of time. This would keep "gradeflation" at a minimum.

In order to sit on the committee a grading service would have to show adherence to the standards set forth and agreed to by the committee. This could be enforced by a couple methods I quickly thought of: by a round table grading session once a month/quarter at a major show whereby examples of each company's slabs are graded by the other services. This could be done quickly and the results would quickly show whether grading standards are changing. There could also be a "set" created and that could also be inserted randomly to help enforce an on-going standard. Grades would be covered up so that the slabbed grade was not known until the session was over.

The second method, which would prove too costly and too untimely, would require periodic submitting of coins to the various services on the committee.

I'd suggest the committee be made up of one "seat" for each eligible grading service and then a small group of four to seven dealers. Since this is a SELF regulating body, there should probably be someone to manage the proceedings and help keep peace.

Grading is always going to be an art which requires time and practice to refine. I haven't heard whatever became of PCGS' computer grading they were trying to perfect years ago. Last I remember the computer couldn't take into account eye appeal.

One last thought on the committee idea. The whole reason of being on the committee would be that if your service is accredited as adhering to current grading standards that would allow more respect and reliance in the market place and should force out the others. You wouldn't have third tier companies, just GOOD or BAD.


Next....the coin market is thinly capitalized. Dealers often need to float money from time-to-time and sometimes problems occur. That's just one example of why you'll sometimes hear dealers discussing a partnership in a coin or deal. If dealers couldn't do this, they'd be restricted to just cherry picking your offerings. When they can float money they can move a deal and make their profit. Without that option, a lot fewer deals would be out there (and I'm referring to large deals of course).

dorkkarl

coin business should not, however, the slabing industry SHOULD be regulated. too many false claims by the plastic dudes, and newbies & suckers fall for 'em all the time.

K S