Are newbies at risk?
ANACONDA
Posts: 4,692 ✭
Do you think newbies are at risk?
(You can define 'at risk' as losing way more money as a percentage of the transaction at the time the transaction was consumated,
than they ever suspected was true...
A comment came up in a thread by Baley that newbies, if they buy carefully, are essentially not at risk any more than someone who buys a new car.
I said that i respectfully disagree and said that that newbies don't realize what an enormous amount of time is required to be able to
spend their money carefully, and that carefully spending their money requires them to study for a reasonably long period of time before they are qualified in my mind to spend a good portion of their income on coins.
And to express myself more clearly, .....in your opinioin, how many ACG coins are out there that were at one time or another purchased
at grey sheet bid by people who thought they were getting their money's worth to only end up getting a small fraction of a dollar's worth
of coins for their dollar? And...if newbies bought carefully, would ACG still be in business?
I thought this thread deserved its own even though Baley started a good thread, that made me want to start this tangential thread
that was entitled "Is our system of third party graders ideal? ...")
adrian
(You can define 'at risk' as losing way more money as a percentage of the transaction at the time the transaction was consumated,
than they ever suspected was true...
A comment came up in a thread by Baley that newbies, if they buy carefully, are essentially not at risk any more than someone who buys a new car.
I said that i respectfully disagree and said that that newbies don't realize what an enormous amount of time is required to be able to
spend their money carefully, and that carefully spending their money requires them to study for a reasonably long period of time before they are qualified in my mind to spend a good portion of their income on coins.
And to express myself more clearly, .....in your opinioin, how many ACG coins are out there that were at one time or another purchased
at grey sheet bid by people who thought they were getting their money's worth to only end up getting a small fraction of a dollar's worth
of coins for their dollar? And...if newbies bought carefully, would ACG still be in business?
I thought this thread deserved its own even though Baley started a good thread, that made me want to start this tangential thread
that was entitled "Is our system of third party graders ideal? ...")
adrian
0
Comments
Six or so months here before ever making a coin purchase is not a bad idea.
Newbies tend to do a terrible job of investing in coins. They tend to be very unfocused and go for quantity over quality. The coins they tend to buy at first are the "commodity" coins, the ones that every dealer has plenty of and the margin is wide.
WH
I totally agree.
Byron
My first YOU SUCK on May 6 2005
GSAGUY
P.S. I just heard earlier this week from Dog97 that ACG actually has bodybags!!!!!
There is no way i am going to go spend $500 on a coin and take the chance that i will only get 25% back on it in the future.(plus my wife would kill me)
but one thing is for sure i would like to maybe spend $50-75 a month on graded coins! I am looking at coins as a hobby and investment also. I have a baby on the way and maybe in 20 years this will help or put him? her? through school. BUt i am not counting on it.
I think that if us newbies wait as long as you say we will get discuraged and go do something else.
Gary
knowledge necessary to get value for your money. Most moderns which sell for more
than face have very little chance of having unknown problems. Mint and proof sets and
unc singles tend to be exactly what they are purported to be. This is no reason to collect
them, but many people are enterring the hobby through the states issues and the other
moderns are more familiar and less threatening to them. Not all dealers are going to
dramatically overcharge newbies in any area. Many newbies are buying coins off e-bay
and are usually paying a price which is at least related to market prices. Those few with
the courage to buy slabs are generally recieving even more value for the money so long
as they stick with the better services. Even the lesser services occasionally will under-
grade a coin.
While it's always been a dangerous field to throw money around with little experience, it
is probably more likely now that a newbie will get much of his money back. Information is
much more available today than it used to be so newbies are likely to pass through this
phase much more quickly than most of us did.
I hear ya. Yeah, maybe a year is too long. You could start out buying fairly inexpensive coins and cut your teeth on those.
Good point.
It's not a problem dedicated to newbies. It's a industry full of fraud and deception.
Michael
LINK
Gary
whether it's the clad or the silver. They even refer to it as a Jeff-
erson in one place. This does tend to be a market in which it is
much easier to buy than to sell, because raw coins are often avail-
able with little outlay of new money. At $7 one couldn't go far
wrong and if it's the silver then it's not so very far over wholesale.
ie, what i'm saying is that even if you were to buy an overgraded, whizzed, a-t'd piece'o'crap - if YOU like it, THAT's what matters. the issue is the time it takes to learn what YOU like, instead of what others tell you to like.
my worthless opinon.
K S
A newbie buying a $7 PCGS Roosie is at far less risk than an experienced collector purchasing another tone-o-matic $4500 common date Morgan.
"France said this week they need more evidence to convince them Saddam is a threat. Yeah, last time France asked for more evidence it came rollin thru Paris with a German Flag on it." -Dave Letterman
I began collecting the $2 1/2 gold Indians, buying them on E-bay and from some local guys. The locals were very honest in there dealings and their grades. E-bay, though is a trap for the uninformed. I bought some graded stuff from companies other than NGC, and PCGS. I began to notice that I could buy them "Cheaper" from those other services.
I also bought some raw coins based upon the sellers "Grading"...UGH!
Thankfully, some informed dealers advised me to buy only PCGS and NGC graded coins. I hear this all the time, "buy the coin not the holder". Well, I can tell you, the holder does make a difference! You cannot see the rims in a holder and grading companies know that.
This forum, along with my own experience, has made me a much better collector... but take it easy on me because I'm still a NEWBIE.
Dan
I wish I had the funds to do an expose on these charlatans. Buy a sample of raw coins and submit them to the major services. After PCGS body bags them, then send them to ANACS for a net grade. Then publish the results. Coin World would go a long way towards protecting their subscribers if they did this. They would need to tell everyone 6 months in advance. I am getting off my soapbox now.
Tempermant is important - I've finally learned to sit on my hands at auctions if the price goes beyond my well-thought-out pre-auction estimates. Took much longer than a year for that to happen. "Real men don't get outbid". This one does now.
Patience is important - "I gotta have that coin". No you don't....others will be available down the road, likely at a better price.
Economy - if you lose your job, the worst time to sell a coin can be when you need the money.
Vagaries of collectables - hot segments go cold.
There are many other factors. You get the idea.
Knowledge certainly is important, but I've seen some very smart people (newbies and oldies) lose money because of the above.
The comment that there is no reason to collect Mint and Proof Sets is wrong. I happen to be very proud of
my sets and enjoy them. Of course a collector wants to show off his/her collection and a complete set of
proof sets has a lot more flair than an inverted V on some penny at the same net cost.
Then we get the babble of the buy the coin, not the slab. Good idea. Yet what do we really hear from
those who are pro's? My $500 coin turned over to $2000 in one week! Is that collecting?
It appears to me that when a "Newbie" shows off his collection, there are some very nice coins.
When a "Experienced, 50 years in collecting, etc." shows off his collection, it's his checking account.
and it sets us apart from practitioners and consultants. Gregor
"As long as their are dealers who will buy a coin at auction for $500, then turn right around and relist it at $2000 or so selling it as a "previously overlooked gem" not only are newbies at risk, we all are. A newbie buying a $7 PCGS Roosie is at far less risk than an experienced collector purchasing another tone-o-matic $4500 common date Morgan. "
Interesting comment. I don't think newbies generally buy monster toned morgans, nor should they.
I know quite a bit about monster toned Morgans. I have purchased Monsters from dealers in monster toned morgans and sold them to other dealers who specialize in monster toned morgans for significant profits. It's called arbitrage.
I would buy back any monster toned morgan that i have sold for no less than 90% of what i sold it for. For a variety of reasons.
In fact i sold a monster reverse toned morgan to a friend recently that i would buy back for what i sold it to him.
[You might want to refer to a thread on toned coins (Toned vs. White? Anaconda's opinion.) to read what i said about what you should have in order to buy monster toned coins.]
adrian
If I do not learn a whole lot about gold coins, then I am susceptible to the new dealers I have to contact for gold coins.
There are a few large dealers with an owner, who is a very good grader, but you never get to speak with that person, because he has 3 or 4 telemarketers doing the spamming and taking calls on their full page ads in Coinworld. These guys could not grade a coin if their life depended on it. They almost always never have pictures of their coins on their websites and also usually do not have a price listed. Ask these Telemarketers to describe a coin and you will hear the famous "Its nice, you will love it ".
I swear to God, I had the president of one of these companies say to me, " buy the plastic, not the coin ". He claimed the Asians were buying very high end coins and they buy the plastic, not the coin.
When you find that one of these telemarketer coin cons has you on the phone for an hour or two, (thats right>up to two hours), trying to get you to purchase a high end coin, then please don't be polite as I tried to be; just slam the phone down as hard as possible to try to impart injury to telemarketing Tony's ear.
Coin Cons, I believe, are capable of reaching all of us at one time or other.
To conclude, I would say the biggest mistake, ANY COIN COLLECTOR can make, is to do business with an unfamiliar coin dealer, without first checking them out with other dealers or collectors that you trust. ZERBE
me some valuable insight on the hobby in it's current form. Namely the pitfalls of raw coins purchased over the Web and
ACG slabbed coins. I also noted that PCGS and NGC slabbed coins were given the most preference by fellow collectors.
Then, with great interest, I read about the debate between collecting modern and classic coins. And there were several
other discussions which finally gave me the confidence re-enter the hobby. Since then, I've still made some mistakes but
I firmly believe I could have done much worse had I just started buying all the round and shiny coins I thought were cool
looking. I don't believe it takes a year to "get your learn on" but I do support the argument that knowledge is paramount
to doing anything right. And finally, a sincere thank you to all the members on this forum that participated in the various
topics I mentioned. You saved me from making several costly mistakes.
I have always been interested in coins, but never really collected anything of value. 3years ago I had no clue what a MS64 coin was, you could have dipped a EF Morgan and told me it was "MS65" and I would have believed you. Right about this time, I was watching the "Coin Club" or whatever it was called on cable, they had this HUGE set of "Prestige Proof Sets" with catchy lingo like "even has the RARE and really hard to Find" etc.... Well I bought the set for $400, thinking I had really scored, man I was going to turn around, sell them on ebay and go buy a new vette.
Reality sank in when I checked with my local coin shop and the guy said something to the effect of "I can sell you the same set for about half of that", my first big mistake.
I also went on a SAE and Buffalo dollar frantic buying spree, thinking this was the way to go, ended up with about 20 buffalos and a chest full of SAE's, most are worth a little less and some a lot less than I paid. My second mistake. Actually did well on the Buffalos.
Now I find myself about 50 mistakes later, a lot wiser and much more educated, If your new, you almost have to make the mistakes unless you have a mentor to guide you along thru every transaction.
Now, everytime I turn around there is another scam on ebay, Everybody talks about coin docs and nobody will say who they are, there is nothing anybody will do about it. Now I read about a coin mag with adds from a company that may be selling whizzed coins...etc....everytime you turn around there is someone waiting to screw you over for a buck or two. Even my local dealer that I have been going to for the last year, screwed me on a Morgan last week.
As for the theory about buying only slabbed coins, how many members have had ebay auctions and watched with delight as a newbie, who just HAD to have that 84 O Morgan PCGS MS64 drive the price well above a reasonable cost. I see this all the time, I did it myself.
I'm off on a wild tanget now, I guess I venting my frustrations of my first two years of collecting. But I've learned my lessons, goten over the ego trips and I have a lot more to learn.
The best tip I can give a newbie, be cautious and do your research and learn to say "I'll pass" if it looks to good to be true or if you have a weird feeling about it, walk away.
____________________________
It sounds like you were watching me a copying everything I did!
Dan :-)
Maddox, me too.
and it sets us apart from practitioners and consultants. Gregor
We all "pay for our education" and the kindest thing we can do for others in this hobby is to help newbies climb the learning curve as fast as they can with as little "educational debt" as possible. As Zerbe pointed out, when we more experienced folks enter a new collecting area, we too start out as "novices" -- albeit not "complete novices" since some of our "educational credits" are transferrable. That's one of the great things about the CU forums -- you can get some "elementary" or "secondary" education "on scholarship," as it were.
There is, however, an enduring need for us "oldsters" to remember what it was like when we were just beginning to collect. You're attracted to the hobby because of certain coins -- or a coin -- and you want to learn more and collect more ... but where do you start? If you're a newbie, you're lucky if you have a clue what a "Redbook" is. Even if you do a Google search and find the CU forums, the "lingo" flies fast and furious (and sometimes "deep"). When you can get over the intimidation (after "lurking" a few days or weeks or months), you start asking your first questions. If you don't luck into a site like this, where do you go? Your local dealer (if there is one nearby)? Your friends? (Hey, most of us have family and friends who don't give a hoot.) Maybe you find a book in the library or a bookshop ... or, worse, several -- and start getting confused.
And don't get me started on grading. When the experts can't agree, what makes a newbie think he has a chance? Maybe you get clued onto the ANA Grading Standards ... but it really does take experience. You have to assume that the folks you are getting coin from are knowledgeable and ethical; some are and some aren't and we're always dismayed when we run into the latter, which fortunately isn't the commoner of the two. One of the most useful things TPG has brought is the -- much under-appreciated -- opportunity to build a grading set. A well-put-together grading set is a really fantastic learning tool for a beginner. They're yours -- preferably the series you're most interested in -- and your can examine them and start developing an eye for the differences between one grade and the next. It's best to start with the circulated grades, IMO, before graduating to the MS grades where the differences become tinier and more subtle. Now, where can you go to purchase such a grading set? Nowhere. I've never heard of a dealer offering one. The average coin shop doesn't even have sufficient variety to "custom build" one. So ... you build them on your own (if you even come up with the idea), which is quite dangerous when you don't know anything really about it -- or the TPG companies. We're brought up used to precision and experts knowing best. When I decided to build one for learning the MS grades, I went to the best expert I knew at the time -- a well-known and well-regarded dealer -- who, frankly, wasn't all that encouraging. He provided me a sample of what he had in the relevant grades and told me just to pick ones where I could see a difference. That was it. Oh well, it gave me a start. Thankfully, he didn't carry ACG, so I didn't mistakenly include any of those in my set simply because they were less expensive!
When you're new and see numbers on a professionally graded slab, you expect that there are clear standards and a consensus on judging them -- after all, these are the experts!! That's perhaps the greatest risk newbies have ... too much trust. Frankly, if we want more people to enter the hobby and stay in it, then we need to find some way to provide them with a better, less costlier form of "primary" education, particularly with getting a leg up on learning grading.
Come on over ... to The Dark Side!
<< <i>Cladking - I disagee. I think newbies will get burned collecting moderns, because the inflated prices of high grade moderns are likely to fall. >>
With what do you disagree? I never suggested anyone collect high grade moderns at inflated prices.
I'm sure there are those here who live to read your numismatic ramblings. But, c'mon man... would it KILL you to take some more pictures of your assistant?
Experience the World through Numismatics...it's more than you can imagine.
(not likely, huh?). And to think, NGC is asking all of us to put down our magnifying glasses and go au naturel. Because then all the coins would look one point higher and justify the asking prices.
I'm not quite ready to lay down my "glass" and join the "new" generation.
roadrunner
What is the etiology of that comment? I'm curious.
New collectors need to take it easy and learn the ropes. If they are lucky they will run into some veterans who will give them some advice. Otherwise they will have to learn on their own, which can be expensive.
I am interested to hear alittle more about your decimal point grading concept and its application...perhaps you might consider explaining it in another thread. I have a question for you to consider:
In your grading approach, are the three graders limited to a round number such as 63 or 64 or can they (individually) call it a 63.5?
Example: 63.5 + 63.8 + 64.1 = 191.4 Then 191.5 divided by 3 would be 63.8 and 63.8 is the final grade.
Experience the World through Numismatics...it's more than you can imagine.
Thanks dad (MacCoin) for getting me into this.
no more than the rest of us idiots.
<< <i>The inimitable dwood said: >>
Okay, DWood, I think we have your title when you hit 10,000 posts!
Come on over ... to The Dark Side!
In the same breath they can talk college and registry. Talk about having your cake and eating it too
No offense meant, of course.
Is that in reference to arms-length eye appeal grading as opposed to technical grading??