<< <i>It's a huge drag on CLCT's stock price to have $18 billion in slabs in the marketplace with a "forever" guarantee. Since 100% of copper EVENTUALLY turns brown (if you are LUCKY...the unlucky end up with blue-green copper salts) how does the market calculate the risk? Seems like you are still covered forever on exisiting coins as long as the coin is not resold after Jan 1, 2010. >>
Two points...
It sure wasn't a drag on CLCT stock when they were slabbing those coins and taking those fees for a guarantee that is no more. To me, that's a classic bait & switch.
Second, while I think you are right in that the coins are covered forever as long as they are not resold, the net result is they are leaving collectors (not dealers) holding the bag because the coin's future resale value will likely change a result of the policy change. To me, it seems they are protecting dealers/flippers at the expense of collectors.
Collector of Large Cents, US Type, and modern pocket change.
<< <i>We have not come up with a consensus as of yet.
We have offered wild and crazy ideas (myself included) as well as mumbling and groaning but no common agreed upon alternative to PCGS's new policy.
What would make the most sense that PCGS would consider as an alternative?
Here is my idea:
PCGS would extend coverage of their guarantee which will henceforth be 2 years on any red copper coins being sold to the next owner after 12/31/2009 only after the coin is submitted to PCGS for a guarantee review and acceptance or rejection and payment of a special guarantee review fee, typically $75 (but not to exceed 10% of the coin's market value).
Possible discussion here of PCGS renewing such guarantee on a yearly basis as long as the coin is submitted to PCGS for an annual guarantee review and payment of the same guarantee review fee. Of course, it is entirely up to PCGS to accept or reject such extension of the guarantee.
This would allow for a more orderly phaseout of the PCGS guarantee program and not leave current owners of such red copper in the lurch.
It is not the boldest way to save the old guarantee program but an idea I believe PCGS might consider especially in light of the reality that many sales transactions after 12/31/2009 will be "backdated" >>
Oreville, That seems to be a relatively fair compromise. A lot of coins flying back and forth, but certainly better than the current plan.
Personally, I like the "change the policy on all coins slabbed after 1/1/10, and keep the guarantee for all coins prior" alternative. That way, PCGS keeps its word, they limit their liability, and people who have collected PCGS copper are not left bearing the financial burden of PCGS going back on its guarantee.....Mike
Collector of Large Cents, US Type, and modern pocket change.
<< <i>It's a huge drag on CLCT's stock price to have $18 billion in slabs in the marketplace with a "forever" guarantee. Since 100% of copper EVENTUALLY turns brown (if you are LUCKY...the unlucky end up with blue-green copper salts) how does the market calculate the risk? Seems like you are still covered forever on exisiting coins as long as the coin is not resold after Jan 1, 2010. >>
You would not be singing such a happy tune if you dealt in original red copper, though. Collectors who know the quality and originality of their copper will somehow have to convince a prospective buyer of such after next month. The even sadder part here is the serious collectors of original copper probably have never sent in a copper piece for PCGS to make good on the guarantee after the coin has turned. I know I never have because my pieces look as they did when I bought them. Your last sentence is particularly aggravating since it's tantamount to having NO guarantee for the serious collector. Think about it.
<< <i>It's a huge drag on CLCT's stock price to have $18 billion in slabs in the marketplace with a "forever" guarantee. Since 100% of copper EVENTUALLY turns brown (if you are LUCKY...the unlucky end up with blue-green copper salts) how does the market calculate the risk? Seems like you are still covered forever on exisiting coins as long as the coin is not resold after Jan 1, 2010. >>
Two points...
It sure wasn't a drag on CLCT stock when they were slabbing those coins and taking those fees for a guarantee that is no more. To me, that's a classic bait & switch.
Second, while I think you are right in that the coins are covered forever as long as they are not resold, the net result is they are leaving collectors (not dealers) holding the bag because the coin's future resale value will likely change a result of the policy change. To me, it seems they are protecting dealers/flippers at the expense of collectors. >>
Amen! I'm tired of people justifying the move or saying we should have known better. A lifetime gaurantee is just that. Unless the entity ceases to exist, it must honor the terms of sale and guarantys/warrantys associated.
<< <i> Amen! I'm tired of people justifying the move or saying we should have known better. A lifetime gaurantee is just that. Unless the entity ceases to exist, it must honor the terms of sale and guarantys/warrantys associated. >>
I didn't realize that people really bought copper relying on the "lifetime guarantee". Is that really what caused you to decide to buy RD cents? --jerry
<< <i>Unless the entity ceases to exist, it must honor the terms of sale and guarantys/warrantys associated. >>
That's the heart of it for me. PCGS is unilaterally reneging on something already paid for. It's hard to find the gray area here except those who just say "Of course they had to do it."
<< <i> Amen! I'm tired of people justifying the move or saying we should have known better. A lifetime gaurantee is just that. Unless the entity ceases to exist, it must honor the terms of sale and guarantys/warrantys associated. >>
I didn't realize that people really bought copper relying on the "lifetime guarantee". Is that really what caused you to decide to buy RD cents? --jerry >>
Perhaps they didn't rely on it, but it was a reassurance (at least for me as a collector of RB copper), and that factors into a price I'm willing to pay, and why I chose to collect RB copper in PCGS slabs.
And all you have to do is look at the prices a raw RB/RD copper piece draws on the open market versus a similar coin slabbed to see the market sees the value-add of the color guarantee -- so it seems I am not alone in this regard.
Yet this additional value is now being removed for us collectors who believed in PCGS, through what appears to me to be a broken promise that smacks of a bait & switch.
Not what I expected from the premier TPG, whose value is added by the market's belief in their word. Not what I expected at all.
Shame on me for taking PCGS's word, I suppose, and lesson learned.
Collector of Large Cents, US Type, and modern pocket change.
<< <i> Amen! I'm tired of people justifying the move or saying we should have known better. A lifetime gaurantee is just that. Unless the entity ceases to exist, it must honor the terms of sale and guarantys/warrantys associated. >>
I didn't realize that people really bought copper relying on the "lifetime guarantee". Is that really what caused you to decide to buy RD cents? --jerry >>
The PCGS Guarantee on copper plays a significant role as to whether I buy red cents graded by their company as opposed to another company. Note, I usually don't buy red cents, but a guarantee makes a big difference.
As a result, one of two things will happen (and probably both). 1. I will treat NGC and PCGS coppers equally for Red/Brown and Red coins. 2. I will change my collecting habits so as to not buy red/brown and especially full red coins unless there is another entity (such as the Eagle Eye Photo Seal) that can provide some type of "quality assurance."
Here is an e-mail I just sent to Don Willis in response to the e-mail announcement that started this thread:
----------------------------
Don,
I am extremely distressed to read that PCGS changed its guarantee with respect to guaranteeing RD and RB copper. To be completely honest, my confidence in PCGS as a third party grader, whose value is ultimately decided by the veracity of its word, has been shaken with what I view as a broken promise. It is also worth noting that nowhere in the PCGS grading guarantee did PCGS reserve the right to change it.
I've paid grading fees and paid premiums for the PCGS copper guarantee, and now PCGS, in my eyes, is breaking its promise to me. While your modified guarantee has protected pieces in my collection until such time as I choose to sell, undoubtedly the resale value of my coins has been reduced because of this decision.
I would very much like for PCGS to reconsider this decision. In more detail, and recognizing the liability that PCGS is taking for slabbing RD/RB copper, I would suggest that PCGS change its position to the following:
o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee. o All RD/RB copper slabbed susbsequent to 1/1/2010 will have no color guarantee.
That way, not only can PCGS limit its liability, but it will have also kept its word.
Respectfully....Mike
p.s. if you would like to discuss this further, please respond to this e-mail, or you may call me at XXX-XXX-XXXX
-----------------------------------
I urge others who are also distressed at this announcement to respond in-kind....Mike
Collector of Large Cents, US Type, and modern pocket change.
<< <i>Here is an e-mail I just sent to Don Willis in response to the e-mail announcement that started this thread:
----------------------------
Don,
I am extremely distressed to read that PCGS changed its guarantee with respect to guaranteeing RD and RB copper. To be completely honest, my confidence in PCGS as a third party grader, whose value is ultimately decided by the veracity of its word, has been shaken with what I view as a broken promise. It is also worth noting that nowhere in the PCGS grading guarantee did PCGS reserve the right to change it.
I've paid grading fees and paid premiums for the PCGS copper guarantee, and now PCGS, in my eyes, is breaking its promise to me. While your modified guarantee has protected pieces in my collection until such time as I choose to sell, undoubtedly the resale value of my coins has been reduced because of this decision.
I would very much like for PCGS to reconsider this decision. In more detail, and recognizing the liability that PCGS is taking for slabbing RD/RB copper, I would suggest that PCGS change its position to the following:
o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee. o All RD/RB copper slabbed susbsequent to 1/1/2010 will have no color guarantee.
That way, not only can PCGS limit its liability, but it will have also kept its word.
Respectfully....Mike
p.s. if you would like to discuss this further, please respond to this e-mail, or you may call me at XXX-XXX-XXXX
-----------------------------------
I urge others who are also distressed at this announcement to respond in-kind....Mike >>
I think that's an excellent email. It is courteous, but direct and to the point, and offers what appears to be the fairest, most practical and easiest to implement alternative to the change that has been announced.
Mike, that is the most reasonable course of action and would satisfy current owners of PCGS graded red copper. Maybe they could make a label change 1/1/10 so everyone will know which coins are covered and which are not. It's about time to freshen up the blue label anyway.
<< <i>I suspect that nobody is telling CU anything that it didn't consider when making the decision. >>
Maybe so, but I don't think they expected this much of a backlash. They are apparently getting bombarded with emails and calls and will lose more money in the long run than if they keep the former guarantee intact. I sent a similar email to David Hall and Don Willis and have spoken to both Chris and Diana at Customer Service. It's interesting, each of the reps said they didn't want to argue with me, but then started an argument anyway as to how this move was not only warranted, but also legal. When I countered with some of the points made here, they said "tell it to the judge" in so many words.
This is such a transparent "bait and switch" that I can't believe they don't see how silly they look right now. If they don't modify this decision soon, then they won't look simply silly anymore... it would be much more than that.
I suspect you're right. However, the variable -- at least how I see it -- is how their customers and the market would react.
The "market" will support the decision; or, at the very least, the market as a whole will acquiesce. After all, we're talking about the market for rare coins, where lots of money is made on irrational choices every day.
As a big fan of PCGS and someone whose testimonial for coinfacts was used on various advertisements I want to let you know how disappointed and angered I am regarding your decision to rescind the color warranty on copper slabs after they are sold. I think this decision is both unethical (changing the service after it's been paid for) and misguided in terms of its effect on how PCGS is viewed in the collector community. In my eyes PCGS has been thought of as the premier TPG for awhile now but the veneer of high grading standards and integrity is fragile and when it start getting chipped away is hard to stop. As a passionate collector who has two number 1 rated registry sets and 98% of my collection in PCGS plastic I ask you to reconsider.
<< <i>I suspect you're right. However, the variable -- at least how I see it -- is how their customers and the market would react.
The "market" will support the decision; or, at the very least, the market as a whole will acquiesce. After all, we're talking about the market for rare coins, where lots of money is made on irrational choices every day. >>
Your point is well taken. However, the issue I was referring to above is how will the market react in terms of prices for these now-not-guranteed-RB/BN-copper, not support or acquiescence.
Collector of Large Cents, US Type, and modern pocket change.
o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee.
I think you'd better think about that proposal. If a coin w/o guarantee sells at Auction 6/15/09 for said amount, then another, then another ......... the prices realized on those w/o guarantee will set the market of your's with guarantee. There is no way around it. The guarantee must remain intact or not at all. Not at all, they will incur a sudden impact. Without they will still fall in value, only slower
<< <i>o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee.
I think you'd better think about that proposal. If a coin w/o guarantee sells at Auction 6/15/09 for said amount, then another, then another ......... the prices realized on those w/o guarantee will set the market of your's with guarantee. There is no way around it. The guarantee must remain intact or not at all. Not at all, they will incur a sudden impact. Without they will still fall in value, only slower >>
A coin that sold in auction in 6/15/09 would have been guaranteed. Did you mean 2010?
<< <i>o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee.
I think you'd better think about that proposal. If a coin w/o guarantee sells at Auction 6/15/09 for said amount, then another, then another ......... the prices realized on those w/o guarantee will set the market of your's with guarantee. There is no way around it. The guarantee must remain intact or not at all. Not at all, they will incur a sudden impact. Without they will still fall in value, only slower >>
Of course there's a way around it. If they keep the guarantee valid for pre-2010 coins, then if post-2010 coins sell for less, it would have no consequence to the ones with the guarantee intact. They would be looked at as completely different animals. It would be almost the same concept as NGC copper normally bringing 50% or less than its PCGS counterpart.
<< <i>o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee.
I think you'd better think about that proposal. If a coin w/o guarantee sells at Auction 6/15/09 for said amount, then another, then another ......... the prices realized on those w/o guarantee will set the market of your's with guarantee. There is no way around it. The guarantee must remain intact or not at all. Not at all, they will incur a sudden impact. Without they will still fall in value, only slower >>
I did think about the proposal, and I disagree that coins with a guarantee will be valued the same as those without. In my view, the coins with a guarantee will be valued differently because of the value of the slab and its associated color guarantee (similar to the OGH-effect, but with the value of the PCGS guarantee behind it), and not set by the auction values of those without.
Respectfully...Mike
Collector of Large Cents, US Type, and modern pocket change.
I spoke with Don Willis over the telephone. Here is a summary:
1. I told Don that I was disappointed in PCGS because, by changing their guarantee, they had broken their word. I said I could understand if they had decided to stop guaranteeing color for new coins graded starting January 1, but I objected to their decision to void the guarantee when one of my coins is sold.
2. Don described the difficulties created by coin doctors. He said the coin doctors have become so good that PCGS can’t detect them. He said this issue is not serious for Indian Head cents, but is a big problem for Lincoln cents. He said the doctored coins usually turn six months after grading. He also said that they couldn’t be responsible if people didn’t take care of their coins properly. Don said that they had spent a lot of time considering this issue, and indicated that they weren’t changing their decision.
3. I told Don that I am not an investor. I explained that I am just a guy who, for the past 15 years, enjoyed collecting and could afford high-end copper coins. I said that, if his graders, who are pros, cannot detect doctored coins, then I don’t stand a chance in this hobby. Starting January 1, if I were to purchase a red coin, I will have no way of knowing whether I am purchasing a coin that has been doctored. Every coin purchased will be a risk for me. As a result, I told Don that I intend to temporarily stop collecting and see what happens to the coin collecting industry.
We spoke for about 20 minutes and also talked about other issues.
Clearly I'm in the minority, but I see why they need to do this. If it is true that the coin doctors are so good that a copper cent doctored to be red cannot be detected at grading time, then there is no point in offering a guarantee any more. All that would happen is that doctored red coins would pour in to PCGS, and when they turn in the holder, PCGS would be on the hook. Many buyers unhappy that their coins turned, blaming PCGS. People complaining that PCGS can't catch the doctors. Where's the upside for PCGS?
If I was running the business, I would not guarantee them either. What would be the point? Again, IF the doctored red coins are not detectable, it doesn't seem reasonable to expect a guarantee.
But I don't think there is any need to void the guarantee for red copper if it has been holdered for a year already without issues. That should be revisited.
What I want from a certification service is making sure the coin is authentic, not tooled, not altered, and in a slab that has good security features. I would also love for them to have photos on their site so if I look up a cert number I can see a photo of the coin as it looked when it was slabbed. The money in coin doctoring is too good to expect a 100% detection rate on messed-with color (including toning on silver). This will continue to be a losing battle as long as the premiums for red copper and attractive toning on other metals are huge.
New collectors, please educate yourself before spending money on coins; there are people who believe that using numismatic knowledge to rip the naïve is what this hobby is all about.
<< <i>2. Don described the difficulties created by coin doctors. He said the coin doctors have become so good that PCGS can’t detect them. He said this issue is not serious for Indian Head cents, but is a big problem for Lincoln cents. He said the doctored coins usually turn six months after grading. He also said that they couldn’t be responsible if people didn’t take care of their coins properly. Don said that they had spent a lot of time considering this issue, and indicated that they weren’t changing their decision. >>
The implications of this statement are worrisome for both PCGS and myself as a collector who enjoys collecting RB copper. I agree with PLE's conclusions:
<< <i>I said that, if his graders, who are pros, cannot detect doctored coins, then I don’t stand a chance in this hobby. Starting January 1, if I were to purchase a red coin, I will have no way of knowing whether I am purchasing a coin that has been doctored. Every coin purchased will be a risk for me. >>
What's worse is that through no fault of our own, outside of believing that PCGS would keep its word, us RD/RB collectors are left holding the bag as PCGS has essentially just pushed the risk they used to guarantee to us collectors of RD/RB copper.
And what's worse is that now we have less than 3 weeks to unload this risk on some other collector who's willing to take a risk that PCGS, the expert TPG, was not willing to shoulder. I can only guess how badly that will go.
Reminds me of a game of musical chairs, with PCGS controlling the music, sitting down in the only chair, and then stopping the music. Us collectors are the ones left standing up.
Thank you very much. Lesson learned. PCGS cannot identify doctored copper, and their guarantee -- backed by a business that has a 60% GP and over $16M in the bank -- can be changed at any time, and when it does, the burden will be left on collectors.
Am I wrong?....Mike
Collector of Large Cents, US Type, and modern pocket change.
I am a little bit more than surprised that a publicly traded company can change a long standing guarantee RETROACTIVELY so easily. Scary. Imagine if the auto industry or maybe the airline construction industry decided to follow this practice... ????
The answer is so obvious, stop guaranteeing the coins graded after a certain date, ones graded before keep the guarantee regardless of who owns them. What's next? Toned Morgan dollars?
What's worse is that through no fault of our own, outside of believing that PCGS would keep its word, us RD/RB collectors are left holding the bag as PCGS has essentially just pushed the risk they used to guarantee to us collectors of RD/RB copper.
And what's worse is that now we have less than 3 weeks to unload this risk on some other collector who's willing to take a risk that PCGS, the expert TPG, was not willing to shoulder. I can only guess how badly that will go.
Am I wrong?....Mike >>
No, I think you're spot on, Mike. What's scary is how everybody is laying down on this, myself included. Regrettably, I believe it's because PCGS has pushed out the competition. They have quietly built a business based on integrity, conservative grading, and a guarantee that made them the premier third party grading service. We paid more to submit to PCGS, because they had earned our trust. We crossed over our NGC/ ANACS/ PCI coins because we knew we could count on them. Hell, some TPG services even folded. In their own words, they set "the standard." In my words they "cornered the market, then changed the rules."
Dead Cat Waltz Exonumia
"Coin collecting for outcasts..."
The solution is even more simple than has been previously alluded to. Unless a buyer feels comfortable in his assessment of a RD or RB coin's originality, he probably shouldn't buy it.
I mean, there is no guarantee, right?
I see this playing out like this:
1) Values of RD certified coins will drop. 2) Values of RB coins will remain largely the same. 3) Values of BN coins will also remain largely the same, save for spectacularly toned certified specimens, which may possibly increase.
<< <i>Will this decision make many collectors turn to NGC? Does NGC have a guarantee on RD/RB copper coins? Not a smart move I'm thinking............. >>
In a word yes, I allready have many NGC holdered copper coins and thay will get all my submissions in the future as thay do still have a guarantee. Admitedly my business is less than nothing to pcgs so its of no consiquence.
<< <i>o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee.
I think you'd better think about that proposal. If a coin w/o guarantee sells at Auction 6/15/09 for said amount, then another, then another ......... the prices realized on those w/o guarantee will set the market of your's with guarantee. There is no way around it. The guarantee must remain intact or not at all. Not at all, they will incur a sudden impact. Without they will still fall in value, only slower >>
Of course there's a way around it. If they keep the guarantee valid for pre-2010 coins, then if post-2010 coins sell for less, it would have no consequence to the ones with the guarantee intact. They would be looked at as completely different animals. It would be almost the same concept as NGC copper normally bringing 50% or less than its PCGS counterpart. >>
Me thinks there will be a few red coppers up for sale on ebay........very soon! Not everyone has caught this drift, no?
Leo
The more qualities observed in a coin, the more desirable that coin becomes!
Starting January 1, if I were to purchase a red coin, I will have no way of knowing whether I am purchasing a coin that has been doctored. Every coin purchased will be a risk for me.
Well, this line sums it up rather nicely, doesn't it? Even the coppers already in their holders are now questionable.
Anybody want to buy a full step nickel?
Leo
The more qualities observed in a coin, the more desirable that coin becomes!
This won't change my submitting habits since I shoot for grades, not color. I do feel for those who's coins are affected by the corrective actions made to protect the entity from overzealous greed mongers who are cheating the system in order to maximize profits from the collectors. I can see WHY the changes are being implemented, but it sure does hurt a lot of collectors. Blame your coin doctors who keep finding ways to cheat.
I love ya TwoSides, but IIRC coin doctors didn't renege on a lifetime guarantee. So why would anybody blame them? Except, of course, the actual culprits.
<< <i>Am I the only one who's surprised this thread hasn't been locked yet? Let's face it. This thread doesn't portray PCGS in a very flattering light. >>
Ya makes yer bed, ya sleeps in it. PCGS has only itself to blame for the blowback. What do they expect when they pull the rug out from under thousands of collectors who have collectively spent tens, if not hundreds of millions of dollars on coins, in at least some part based upon this guarantee?
<< <i>Am I the only one who's surprised this thread hasn't been locked yet? Let's face it. This thread doesn't portray PCGS in a very flattering light. >>
While thats true there are also many posts form kool-aid drinkers that support this action so it could be that pcgs feels that things are all even.
Disturbing news. I would think that a dated slab is in order, so that the collector, who will now assume all of the risk, can make a more informed decision regarding the purchase of a new copper coin graded RD or RB.
I also feel that a lot of posters saying it's about time and whatnot would, or will be singing a different tune when/if PCGS decides to rescind their guarantee on other designations, such as DMPL Morgans. Artificial frost, anyone? FBL's? FS's? FH's? Laser etching, anyone? We should all be concerned about this.
Comments
<< <i>It's a huge drag on CLCT's stock price to have $18 billion in slabs in the marketplace with a "forever" guarantee. Since 100% of copper EVENTUALLY turns brown (if you are LUCKY...the unlucky end up with blue-green copper salts) how does the market calculate the risk? Seems like you are still covered forever on exisiting coins as long as the coin is not resold after Jan 1, 2010. >>
Two points...
It sure wasn't a drag on CLCT stock when they were slabbing those coins and taking those fees for a guarantee that is no more. To me, that's a classic bait & switch.
Second, while I think you are right in that the coins are covered forever as long as they are not resold, the net result is they are leaving collectors (not dealers) holding the bag because the coin's future resale value will likely change a result of the policy change. To me, it seems they are protecting dealers/flippers at the expense of collectors.
<< <i>We have not come up with a consensus as of yet.
We have offered wild and crazy ideas (myself included) as well as mumbling and groaning but no common agreed upon alternative to PCGS's new policy.
What would make the most sense that PCGS would consider as an alternative?
Here is my idea:
PCGS would extend coverage of their guarantee which will henceforth be 2 years on any red copper coins being sold to the next owner after 12/31/2009 only after the coin is submitted to PCGS for a guarantee review and acceptance or rejection and payment of a special guarantee review fee, typically $75 (but not to exceed 10% of the coin's market value).
Possible discussion here of PCGS renewing such guarantee on a yearly basis as long as the coin is submitted to PCGS for an annual guarantee review and payment of the same guarantee review fee. Of course, it is entirely up to PCGS to accept or reject such extension of the guarantee.
This would allow for a more orderly phaseout of the PCGS guarantee program and not leave current owners of such red copper in the lurch.
It is not the boldest way to save the old guarantee program but an idea I believe PCGS might consider especially in light of the reality that many sales transactions after 12/31/2009 will be "backdated" >>
Oreville, That seems to be a relatively fair compromise. A lot of coins flying back and forth, but certainly better than the current plan.
Personally, I like the "change the policy on all coins slabbed after 1/1/10, and keep the guarantee for all coins prior" alternative. That way, PCGS keeps its word, they limit their liability, and people who have collected PCGS copper are not left bearing the financial burden of PCGS going back on its guarantee.....Mike
<< <i>It's a huge drag on CLCT's stock price to have $18 billion in slabs in the marketplace with a "forever" guarantee. Since 100% of copper EVENTUALLY turns brown (if you are LUCKY...the unlucky end up with blue-green copper salts) how does the market calculate the risk? Seems like you are still covered forever on exisiting coins as long as the coin is not resold after Jan 1, 2010. >>
You would not be singing such a happy tune if you dealt in original red copper, though. Collectors who know the quality and originality of their copper will somehow have to convince a prospective buyer of such after next month. The even sadder part here is the serious collectors of original copper probably have never sent in a copper piece for PCGS to make good on the guarantee after the coin has turned. I know I never have because my pieces look as they did when I bought them. Your last sentence is particularly aggravating since it's tantamount to having NO guarantee for the serious collector. Think about it.
<< <i>
<< <i>It's a huge drag on CLCT's stock price to have $18 billion in slabs in the marketplace with a "forever" guarantee. Since 100% of copper EVENTUALLY turns brown (if you are LUCKY...the unlucky end up with blue-green copper salts) how does the market calculate the risk? Seems like you are still covered forever on exisiting coins as long as the coin is not resold after Jan 1, 2010. >>
Two points...
It sure wasn't a drag on CLCT stock when they were slabbing those coins and taking those fees for a guarantee that is no more. To me, that's a classic bait & switch.
Second, while I think you are right in that the coins are covered forever as long as they are not resold, the net result is they are leaving collectors (not dealers) holding the bag because the coin's future resale value will likely change a result of the policy change. To me, it seems they are protecting dealers/flippers at the expense of collectors. >>
Amen! I'm tired of people justifying the move or saying we should have known better. A lifetime gaurantee is just that. Unless the entity ceases to exist, it must honor the terms of sale and guarantys/warrantys associated.
https://pcgs.com/setregistry/showcase/2819
<< <i> Amen! I'm tired of people justifying the move or saying we should have known better. A lifetime gaurantee is just that. Unless the entity ceases to exist, it must honor the terms of sale and guarantys/warrantys associated. >>
I didn't realize that people really bought copper relying on the "lifetime guarantee". Is that really what caused you to decide to buy RD cents? --jerry
<< <i>Unless the entity ceases to exist, it must honor the terms of sale and guarantys/warrantys associated. >>
That's the heart of it for me. PCGS is unilaterally reneging on something already paid for. It's hard to find the gray area here except those who just say "Of course they had to do it."
Who is John Galt?
<< <i>
<< <i> Amen! I'm tired of people justifying the move or saying we should have known better. A lifetime gaurantee is just that. Unless the entity ceases to exist, it must honor the terms of sale and guarantys/warrantys associated. >>
I didn't realize that people really bought copper relying on the "lifetime guarantee". Is that really what caused you to decide to buy RD cents? --jerry >>
Perhaps they didn't rely on it, but it was a reassurance (at least for me as a collector of RB copper), and that factors into a price I'm willing to pay, and why I chose to collect RB copper in PCGS slabs.
And all you have to do is look at the prices a raw RB/RD copper piece draws on the open market versus a similar coin slabbed to see the market sees the value-add of the color guarantee -- so it seems I am not alone in this regard.
Yet this additional value is now being removed for us collectors who believed in PCGS, through what appears to me to be a broken promise that smacks of a bait & switch.
Not what I expected from the premier TPG, whose value is added by the market's belief in their word. Not what I expected at all.
Shame on me for taking PCGS's word, I suppose, and lesson learned.
<< <i>
<< <i> Amen! I'm tired of people justifying the move or saying we should have known better. A lifetime gaurantee is just that. Unless the entity ceases to exist, it must honor the terms of sale and guarantys/warrantys associated. >>
I didn't realize that people really bought copper relying on the "lifetime guarantee". Is that really what caused you to decide to buy RD cents? --jerry >>
The PCGS Guarantee on copper plays a significant role as to whether I buy red cents graded by their company as opposed to another company. Note, I usually don't buy red cents, but a guarantee makes a big difference.
As a result, one of two things will happen (and probably both).
1. I will treat NGC and PCGS coppers equally for Red/Brown and Red coins.
2. I will change my collecting habits so as to not buy red/brown and especially full red coins unless there is another entity (such as the Eagle Eye Photo Seal) that can provide some type of "quality assurance."
----------------------------
Don,
I am extremely distressed to read that PCGS changed its guarantee with respect to guaranteeing RD and RB copper. To be completely honest, my confidence in PCGS as a third party grader, whose value is ultimately decided by the veracity of its word, has been shaken with what I view as a broken promise. It is also worth noting that nowhere in the PCGS grading guarantee did PCGS reserve the right to change it.
I've paid grading fees and paid premiums for the PCGS copper guarantee, and now PCGS, in my eyes, is breaking its promise to me. While your modified guarantee has protected pieces in my collection until such time as I choose to sell, undoubtedly the resale value of my coins has been reduced because of this decision.
I would very much like for PCGS to reconsider this decision. In more detail, and recognizing the liability that PCGS is taking for slabbing RD/RB copper, I would suggest that PCGS change its position to the following:
o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee.
o All RD/RB copper slabbed susbsequent to 1/1/2010 will have no color guarantee.
That way, not only can PCGS limit its liability, but it will have also kept its word.
Respectfully....Mike
p.s. if you would like to discuss this further, please respond to this e-mail, or you may call me at XXX-XXX-XXXX
-----------------------------------
I urge others who are also distressed at this announcement to respond in-kind....Mike
<< <i>Here is an e-mail I just sent to Don Willis in response to the e-mail announcement that started this thread:
----------------------------
Don,
I am extremely distressed to read that PCGS changed its guarantee with respect to guaranteeing RD and RB copper. To be completely honest, my confidence in PCGS as a third party grader, whose value is ultimately decided by the veracity of its word, has been shaken with what I view as a broken promise. It is also worth noting that nowhere in the PCGS grading guarantee did PCGS reserve the right to change it.
I've paid grading fees and paid premiums for the PCGS copper guarantee, and now PCGS, in my eyes, is breaking its promise to me. While your modified guarantee has protected pieces in my collection until such time as I choose to sell, undoubtedly the resale value of my coins has been reduced because of this decision.
I would very much like for PCGS to reconsider this decision. In more detail, and recognizing the liability that PCGS is taking for slabbing RD/RB copper, I would suggest that PCGS change its position to the following:
o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee.
o All RD/RB copper slabbed susbsequent to 1/1/2010 will have no color guarantee.
That way, not only can PCGS limit its liability, but it will have also kept its word.
Respectfully....Mike
p.s. if you would like to discuss this further, please respond to this e-mail, or you may call me at XXX-XXX-XXXX
-----------------------------------
I urge others who are also distressed at this announcement to respond in-kind....Mike >>
I think that's an excellent email. It is courteous, but direct and to the point, and offers what appears to be the fairest, most practical and easiest to implement alternative to the change that has been announced.
<< <i>I suspect that nobody is telling CU anything that it didn't consider when making the decision. >>
I suspect you're right. However, the variable -- at least how I see it -- is how their customers and the market would react.
And I urge all PCGS collectors to respond with their thoughts -- after all, if RD/RB copper is first, what's next?
<< <i>I suspect that nobody is telling CU anything that it didn't consider when making the decision. >>
Maybe so, but I don't think they expected this much of a backlash. They are apparently getting bombarded with emails and calls and will lose more money in the long run than if they keep the former guarantee intact. I sent a similar email to David Hall and Don Willis and have spoken to both Chris and Diana at Customer Service. It's interesting, each of the reps said they didn't want to argue with me, but then started an argument anyway as to how this move was not only warranted, but also legal. When I countered with some of the points made here, they said "tell it to the judge" in so many words.
This is such a transparent "bait and switch" that I can't believe they don't see how silly they look right now. If they don't modify this decision soon, then they won't look simply silly anymore... it would be much more than that.
The "market" will support the decision; or, at the very least, the market as a whole will acquiesce. After all, we're talking about the market for rare coins, where lots of money is made on irrational choices every day.
Don,
As a big fan of PCGS and someone whose testimonial for coinfacts was used on various advertisements I want to let you know how disappointed and angered I am regarding your decision to rescind the color warranty on copper slabs after they are sold. I think this decision is both unethical (changing the service after it's been paid for) and misguided in terms of its effect on how PCGS is viewed in the collector community. In my eyes PCGS has been thought of as the premier TPG for awhile now but the veneer of high grading standards and integrity is fragile and when it start getting chipped away is hard to stop. As a passionate collector who has two number 1 rated registry sets and 98% of my collection in PCGS plastic I ask you to reconsider.
Best regards,
Who is John Galt?
<< <i>I suspect you're right. However, the variable -- at least how I see it -- is how their customers and the market would react.
The "market" will support the decision; or, at the very least, the market as a whole will acquiesce. After all, we're talking about the market for rare coins, where lots of money is made on irrational choices every day. >>
Your point is well taken. However, the issue I was referring to above is how will the market react in terms of prices for these now-not-guranteed-RB/BN-copper, not support or acquiescence.
Some research into the history, mutations and retroactive rescinding of the PSA/DNA "Auction Loa" may be worthhile in this context as a precedent.
Brest,
Eric
I think you'd better think about that proposal.
If a coin w/o guarantee sells at Auction 6/15/09 for said amount, then another, then another ......... the prices realized on those w/o guarantee will set the market of your's with guarantee. There is no way around it. The guarantee must remain intact or not at all. Not at all, they will incur a sudden impact. Without they will still fall in value, only slower
<< <i>o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee.
I think you'd better think about that proposal.
If a coin w/o guarantee sells at Auction 6/15/09 for said amount, then another, then another ......... the prices realized on those w/o guarantee will set the market of your's with guarantee. There is no way around it. The guarantee must remain intact or not at all. Not at all, they will incur a sudden impact. Without they will still fall in value, only slower >>
A coin that sold in auction in 6/15/09 would have been guaranteed. Did you mean 2010?
<< <i>o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee.
I think you'd better think about that proposal.
If a coin w/o guarantee sells at Auction 6/15/09 for said amount, then another, then another ......... the prices realized on those w/o guarantee will set the market of your's with guarantee. There is no way around it. The guarantee must remain intact or not at all. Not at all, they will incur a sudden impact. Without they will still fall in value, only slower >>
Of course there's a way around it. If they keep the guarantee valid for pre-2010 coins, then if post-2010 coins sell for less, it would have no consequence to the ones with the guarantee intact. They would be looked at as completely different animals. It would be almost the same concept as NGC copper normally bringing 50% or less than its PCGS counterpart.
<< <i>o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee.
I think you'd better think about that proposal.
If a coin w/o guarantee sells at Auction 6/15/09 for said amount, then another, then another ......... the prices realized on those w/o guarantee will set the market of your's with guarantee. There is no way around it. The guarantee must remain intact or not at all. Not at all, they will incur a sudden impact. Without they will still fall in value, only slower >>
I did think about the proposal, and I disagree that coins with a guarantee will be valued the same as those without. In my view, the coins with a guarantee will be valued differently because of the value of the slab and its associated color guarantee (similar to the OGH-effect, but with the value of the PCGS guarantee behind it), and not set by the auction values of those without.
Respectfully...Mike
1. I told Don that I was disappointed in PCGS because, by changing their guarantee, they had broken their word. I said I could understand if they had decided to stop guaranteeing color for new coins graded starting January 1, but I objected to their decision to void the guarantee when one of my coins is sold.
2. Don described the difficulties created by coin doctors. He said the coin doctors have become so good that PCGS can’t detect them. He said this issue is not serious for Indian Head cents, but is a big problem for Lincoln cents. He said the doctored coins usually turn six months after grading. He also said that they couldn’t be responsible if people didn’t take care of their coins properly. Don said that they had spent a lot of time considering this issue, and indicated that they weren’t changing their decision.
3. I told Don that I am not an investor. I explained that I am just a guy who, for the past 15 years, enjoyed collecting and could afford high-end copper coins. I said that, if his graders, who are pros, cannot detect doctored coins, then I don’t stand a chance in this hobby. Starting January 1, if I were to purchase a red coin, I will have no way of knowing whether I am purchasing a coin that has been doctored. Every coin purchased will be a risk for me. As a result, I told Don that I intend to temporarily stop collecting and see what happens to the coin collecting industry.
We spoke for about 20 minutes and also talked about other issues.
If I was running the business, I would not guarantee them either. What would be the point? Again, IF the doctored red coins are not detectable, it doesn't seem reasonable to expect a guarantee.
But I don't think there is any need to void the guarantee for red copper if it has been holdered for a year already without issues. That should be revisited.
What I want from a certification service is making sure the coin is authentic, not tooled, not altered, and in a slab that has good security features. I would also love for them to have photos on their site so if I look up a cert number I can see a photo of the coin as it looked when it was slabbed. The money in coin doctoring is too good to expect a 100% detection rate on messed-with color (including toning on silver). This will continue to be a losing battle as long as the premiums for red copper and attractive toning on other metals are huge.
New collectors, please educate yourself before spending money on coins; there are people who believe that using numismatic knowledge to rip the naïve is what this hobby is all about.
<< <i>2. Don described the difficulties created by coin doctors. He said the coin doctors have become so good that PCGS can’t detect them. He said this issue is not serious for Indian Head cents, but is a big problem for Lincoln cents. He said the doctored coins usually turn six months after grading. He also said that they couldn’t be responsible if people didn’t take care of their coins properly. Don said that they had spent a lot of time considering this issue, and indicated that they weren’t changing their decision. >>
The implications of this statement are worrisome for both PCGS and myself as a collector who enjoys collecting RB copper. I agree with PLE's conclusions:
<< <i>I said that, if his graders, who are pros, cannot detect doctored coins, then I don’t stand a chance in this hobby. Starting January 1, if I were to purchase a red coin, I will have no way of knowing whether I am purchasing a coin that has been doctored. Every coin purchased will be a risk for me. >>
What's worse is that through no fault of our own, outside of believing that PCGS would keep its word, us RD/RB collectors are left holding the bag as PCGS has essentially just pushed the risk they used to guarantee to us collectors of RD/RB copper.
And what's worse is that now we have less than 3 weeks to unload this risk on some other collector who's willing to take a risk that PCGS, the expert TPG, was not willing to shoulder. I can only guess how badly that will go.
Reminds me of a game of musical chairs, with PCGS controlling the music, sitting down in the only chair, and then stopping the music. Us collectors are the ones left standing up.
Thank you very much. Lesson learned. PCGS cannot identify doctored copper, and their guarantee -- backed by a business that has a 60% GP and over $16M in the bank -- can be changed at any time, and when it does, the burden will be left on collectors.
Am I wrong?....Mike
change a long standing guarantee RETROACTIVELY so easily.
Scary.
Imagine if the auto industry or maybe the airline construction industry decided to follow this practice... ????
of who owns them. What's next? Toned Morgan dollars?
Steve
And what's worse is that now we have less than 3 weeks to unload this risk on some other collector who's willing to take a risk that PCGS, the expert TPG, was not willing to shoulder. I can only guess how badly that will go.
Am I wrong?....Mike >>
No, I think you're spot on, Mike. What's scary is how everybody is laying down on this, myself included. Regrettably, I believe it's because PCGS has pushed out the competition. They have quietly built a business based on integrity, conservative grading, and a guarantee that made them the premier third party grading service. We paid more to submit to PCGS, because they had earned our trust. We crossed over our NGC/ ANACS/ PCI coins because we knew we could count on them. Hell, some TPG services even folded.
In their own words, they set "the standard." In my words they "cornered the market, then changed the rules."
Dead Cat Waltz Exonumia
"Coin collecting for outcasts..."
I mean, there is no guarantee, right?
I see this playing out like this:
1) Values of RD certified coins will drop.
2) Values of RB coins will remain largely the same.
3) Values of BN coins will also remain largely the same, save for spectacularly toned certified specimens, which may possibly increase.
Empty Nest Collection
Matt’s Mattes
Many members on this forum that now it cannot fit in my signature. Please ask for entire list.
<< <i>My e-mail said this:
... consequently we will not be guaranteeing the color of cooper coins graded or sold after January 1, 2010.
Clearly it only applies to "cooper" coins, not copper.
Hopefully, they will get back to actually grading copper instead of just putting everything in "genuine" holders". >>
Check out my current listings: https://ebay.com/sch/khunt/m.html?_ipg=200&_sop=12&_rdc=1
<< <i>Will this decision make many collectors turn to NGC? Does NGC have a guarantee on RD/RB copper coins? Not a smart move I'm thinking............. >>
In a word yes, I allready have many NGC holdered copper coins and thay will get all my submissions in the future as thay do still have a guarantee. Admitedly my business is less than nothing to pcgs so its of no consiquence.
My Collection of Old Holders
Never a slave to one plastic brand will I ever be.
<< <i>
<< <i>o All RD/RB copper slabbed prior to 1/1/2010 will have the color guarantee.
I think you'd better think about that proposal.
If a coin w/o guarantee sells at Auction 6/15/09 for said amount, then another, then another ......... the prices realized on those w/o guarantee will set the market of your's with guarantee. There is no way around it. The guarantee must remain intact or not at all. Not at all, they will incur a sudden impact. Without they will still fall in value, only slower >>
Of course there's a way around it. If they keep the guarantee valid for pre-2010 coins, then if post-2010 coins sell for less, it would have no consequence to the ones with the guarantee intact. They would be looked at as completely different animals. It would be almost the same concept as NGC copper normally bringing 50% or less than its PCGS counterpart. >>
Me thinks there will be a few red coppers up for sale on ebay........very soon!
Leo
The more qualities observed in a coin, the more desirable that coin becomes!
My Jefferson Nickel Collection
Well, this line sums it up rather nicely, doesn't it? Even the coppers already in their holders are now questionable.
Anybody want to buy a full step nickel?
Leo
The more qualities observed in a coin, the more desirable that coin becomes!
My Jefferson Nickel Collection
Proud recipient of two "You Suck" awards
Worry is the interest you pay on a debt you may not owe.
<< <i>Am I the only one who's surprised this thread hasn't been locked yet? Let's face it. This thread doesn't portray PCGS in a very flattering light. >>
Ya makes yer bed, ya sleeps in it. PCGS has only itself to blame for the blowback. What do they expect when they pull the rug out from under thousands of collectors who have collectively spent tens, if not hundreds of millions of dollars on coins, in at least some part based upon this guarantee?
1/2 Cents
U.S. Revenue Stamps
<< <i>Am I the only one who's surprised this thread hasn't been locked yet? Let's face it. This thread doesn't portray PCGS in a very flattering light. >>
While thats true there are also many posts form kool-aid drinkers that support this action so it could be that pcgs feels that things are all even.
My Collection of Old Holders
Never a slave to one plastic brand will I ever be.
Give em Hell at the PCGS Luncheon in Florida!!! Huelga! Huelga! Huelga!
I also feel that a lot of posters saying it's about time and whatnot would, or will be singing a different tune when/if PCGS decides to rescind their guarantee on other designations, such as DMPL Morgans. Artificial frost, anyone? FBL's? FS's? FH's? Laser etching, anyone? We should all be concerned about this.
Lincoln set Colorless Set
I assume the absence of a guarantee also applies to Brown coins. The email just said "color" will no longer be guaranteed.
<< <i>I assume the absence of a guarantee also applies to Brown coins. >>
Are you affraid your brown coppers may someday turn red?
Worry is the interest you pay on a debt you may not owe.
<< <i>
<< <i>I assume the absence of a guarantee also applies to Brown coins. >>
Are you affraid your brown coppers may someday turn red?
No, but copper eventually turns green, right??
Michael Kittle Rare Coins --- 1908-S Indian Head Cent Grading Set --- No. 1 1909 Mint Set --- Kittlecoins on Facebook --- Long Beach Table 448
<< <i>
<< <i>
<< <i>I assume the absence of a guarantee also applies to Brown coins. >>
Are you affraid your brown coppers may someday turn red?
No, but copper eventually turns green, right?? >>
Have you ever seen a brown copper turn green in a slab?
Worry is the interest you pay on a debt you may not owe.