Coin Grading Scandal

ajw

I know we collect cardboard and not metal (well, some new stuff is more metal than paper, it seems) but I thought this was interesting.

Can you believe that the state of Ohio actually invested in rare coins? Hmmm. Maybe we've found the ID of the long unknown MOSH.

Linky

softparade

You can just plug "sportscard" into every slot saying "coin" in that article and you have OUR hobby

Lothar52

YEP..subjective..but its better then believing the SELLER!!!!

loth

baseballfanatic

Hate to say it, but you will ALWAYS find a person who will put their thumb on scale. No matter if its an individual or a third party. The rewards for even just one or two times is just too great...................

stown

An interesting tidbit from the article:



<< <i>"I was a grader at [Numismatic Guaranty], and it's not to preserve the rarity of it, you're concerned about creating wealth," he said. "If I look at a coin and it was graded 64, or it would likely be a 64-high end, and as a 64 it was worth $40,000 and as a 65, it was worth $400,000, then I would be very concerned about calling it a 65."

"If I thought it was a marginally low-end 65, I would opt to grade it a 64," he said of his example. "It has nothing to do with honesty. You look at a coin and you don't want to create wealth. I don't want to bear that responsibility, and I would give it the lower grade." >>

goudeygold

I strongly believe this is PSAs mentality now. We all have seen so many old flip cards that are overgraded. it is much tougher now. In pre-war they aren't going to just slip you an 8 unless it is a solid 8.5-8.9 in their eyes. In the past I personally think if it was a 7.6 they would slab it in an 8.

GG

schr1st

It is for reasons like this that I'm proud that PSA has not gone to a .5 grading scale, and hope that for these reasons they never will.

jrdolan

Man, compared to the "insider" shenanigans in the coin market, some of our (my) complaints about vintage card grading by the Big Three seem almost petty.

Beckett's modern grading service is another story, almost a different industry altogether, and it may be more of a parallel to the coin hobby in terms of either being a wolf who knows how to work the system or a sheep who doesn't.

In vintage we have our sleazy elements like PRO and the unauthorized reprint scams, true, but this coin thing involves the top grading services, not some kitchen-table operation. Maybe I'm just refusing to see it in my beloved vintage cards.

Does the coin hobby have its versions of PRO and GEM, etc.?

Boopotts

I agree with Goudey (and, by extension, I guess I disagree with DGF-- although I still really like him). It's much harder to get a vintage card in a 9 slab now then it was four years ago.

Also, is their anything more ridiculous then the coin grading scale.Mint 66, mint 67, mint 68-- are you kidding me? As schr1st said, I think the .5 scale is dumb enough-the coin scale is pure comedy in action.

Boopotts

Here here, Jdolan, on the BGS deal. I'm convinced that you're either on the inside looking out or the outside looking in as far as that set-up goes. Just too many guys with far too many BGS 9.5's on the 'bay for this to be a statiscal anomaly. Look at arodspecialist and unklbnz, for instance-sorry, but nobody has a keen enough eye to pick 98% gem mints out of a pile of raw cards. No way.

Knuckles

Someone with too much money and time on their hands should buy a ton of the BGS 9.5's crack them, send then to PSA or SGC and record what happens... write an article about it in the SMR or something. Paste it all over the beckett boards..

jrdolan

<< <i>Someone with too much money and time on their hands should buy a ton of the BGS 9.5's crack them, send then to PSA or SGC and record what happens... write an article about it in the SMR or something. Paste it all over the beckett boards.. >>


That would be a losing proposition. You might get some PSA 10's, but you'd also get some 9's and some "evid. trim" and "altered" (the last usually meaning a dealer cut them from sheets). You'd have to get them regraded by BGS and sell them just to get your initial investment back, but you'd still be out all those PSA grading and BGS regrading fees, not to mention the time and expense of reselling them. I've already cracked enough BGS to form my own opinion, though not enough to present a credible body of evidence.

At the moment there are nearly 1,800 BGS 9.5 cards for sale on eBay, and god knows how many more in the Beckett Store, NAXCOM, etc. Today BGS 9.5 is far from the one-in-a-thousand grade it was first touted as. Some people who paid huge bucks for a "rare" 9.5 are in for an unpleasant surprise when they realize what's going on.

Some of us complain because PSA is now very stingy with its 9's and 10's. Well, I have, anyway. But I'd rather be on this side of the fence, the way the market is developing.

WinPitcher

The coin grading scale (1 thru 70) was adapted from a grading scale for cents. The person (i forget who) devised it for cents only with grade and difficulty in mind.

IJustLoveCards

"If I thought it was a marginally low-end 65, I would opt to grade it a 64," he said of his example. "It has nothing to do with honesty. You look at a coin and you don't want to create wealth. I don't want to bear that responsibility, and I would give it the lower grade."

Hummmm...now we know whats really going on...so a low "8" ..with value, is better graded a "7"....ouch!!

Stone193

<< <i>"If I thought it was a marginally low-end 65, I would opt to grade it a 64," he said of his example. "It has nothing to do with honesty. You look at a coin and you don't want to create wealth. I don't want to bear that responsibility, and I would give it the lower grade." >>


At this point in the writeup, they talk of a 64 being worth 40 grand, e.g. and then a 65 worth 400 grand!
A 10X increase - that's the problem - the bump is just too high to trust.

Based on this paragraph and a recent talks of grading companies assigning perfect 10s - it becomes more evident than ever to buy the card, not the holder. If one were to buy a 10 graded card for big bucks, I would want to see it myself before buying it.

Don't trust a 10 till you have it in your hand...seems to be the take home message.

mike

ndleo

I have to disagree with David Hall's statement that there is no conflict of interest when dealers also own the grading company. I am a believer that if there is an opportunity to scam, them it will happen. This is like the Internet stock days when the brokerages selling the IPO's were the same ones publishing research hyping the stocks.

If I recall isn't an inside dealer scam the reason why the owners of GAI were forced out?

Stone193

nd
I was thinking that Hall was referring to "stock" ownership as opposed to "direct" owner/participation in the operation of the company?

mike