NGC savagely roasts PCGS, accusations of gradeflation & hurting market
Danye West
Posts: 193 ✭✭✭
SHOTS FIRED!
https://www.ngccoin.com/news/article/5740/
Thoughts?
I could make a birth year registry set out of pocket change.
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There is already a thread on this topic.
Very well said. Thanks for the link.
I just read part of the e-mail, came here to see if anything had been posted prior to starting a thread. I didn't read the entire message but it does seem a bit harsh, an indictment of PCGS' integrity with a subtle suggestion that it is intentional and PCGS is deflating the value of the coin market. to that end, I see it as a little more than just a "shot fired across the bow" of the PCGS ship.
I don't know where the other thread is or how much discussion this received. I view it as a declaration of some type and a subtle attempt to sway collectors/submitters/buyers away from PCGS. based on what I have seen during the past 16 years I don't expect that to succeed but I do expect negative fallout for NGC.
what is the sense of doing this and is it being discussed at SleepyHollow??
Oh yeah, it's being discussed pro and con as we speak. Thread is three pages and growing.
Kind regards,
George
I think Salzberg's comments are overboard. Looks like an attack as the result of some sort of fear.
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I am thinking that a lot of coins from ATS are crossing-over to PCGS holders and quite a bit of crack-outs for (re)submission are possibilities, not necessarily "hoards" being brought into the market.
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The author likely knows quite well why pop reports are multiplying in top graded coins, but chooses to play dumb. Every show I go to the crack out dealers are combing the floors looking for upgrades and the pops could very likely be the same coins over and over again until they either give up or get the bump.
The reason NGC pops aren't increasing at similar rates IMO is because fewer are trying the crackout games and submitting to NGC. The market seems to have spoken about the current difference in value so why would people be trying to upgrade at NGC?
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His whole argument is predicated on the assumption that these coins can't and don't exist out in the wild. I'm not sure what the purpose of the price graphs are - it's kind of a non sequitur - no one argues that increasing the supply of a high grade coin decreases its value.
Therefore, one of three things is happening:
1. Gradeflation. PCGS is giving 64/65 coins an illegitimate 66/67 grade.
2. These coins have always existed; they are simply being driven into PCGS plastic for one of many reasons:
* Economy. Struggling sellers are searching out and finding these gems to make a profit.
* Hoards. Heirs may be sending in these higher grade coins that have been tucked away by senior collectors.
* Upgrades. True under-graded coins are being cracked out and rightfully upgraded.
3. A combination of 1 & 2.
As time increases on his graphs, so do the number of coins graded - including higher pops. These arguments are completely ignored in his article.
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I'd offer up another possibility: The population reports are just more and more unreliable as time goes on.
Nobody REALLY knows what the Pop in MS-67 REALLY is, (for example), nor what the quality of the existing MS-67's REALLY is in relation to each other over that entire population, (either within one grading service, or between the two).
Some on these forums might, I guess....but those of us chasing AU-50's don't.
As much as the engineer in me likes real data....I'm not sure that "real" data exists. It may be a case where trusting your eyes, and other "friendly" eyes, is more important than making tables, graphs, and other numeric comparisons.
Anecdotal, but I was discussing the OLD tactic of submitting a PCGS coin as a crackout to NGC, get a higher grade on NGC and then do a regrade at PC.
This USED to work GREAT.
I had a 64 that went to 66 at NGC and then back to PCGS for a ....matching...66.
With a commensurate increase in price.
And I do not own the coin anymore.
And our conversation indicated that this dealer felt that NGC was tighter than PCGS now.
???????
Fake news and politics caused this mess.
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" The reason NGC pops aren't increasing at similar rates IMO is because fewer are trying the crackout games and submitting to NGC. The market seems to have spoken about the current difference in value so why would people be trying to upgrade at NGC? "
Some truth to that. In gem type coins a one grade lower PCGS CAC coin will frequently bring more money than a higher graded NGC coin that is not stickered. People are frequently downgrading their coins, something almost never seen prior to 2009. This is in a sense, unwinding a lot of the NGC gradeflation that occurred from 1997-2008. In those pre-CAC years, an NGC upgrade was almost always an automatic 50-80% profit. These days, if that coin doesn't CAC, then there's likely little to no profit. The game has changed....totally.
He also ignores, as Rick pointed out in the other thread, that two original rolls of '12-S nickels were recently brought to market and graded at PCGS, explaining the pop surge for that issue -- and utterly invalidating one of the examples he tries to make.
There is a definite 'slight' gradeflation going on and dealers and collectors are aware of this and are cracking out coins in droves and re-submitting for the higher grades.
No hoards, just massive amounts of re-grades.
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Salzberg is trying the bolster his rational for excluding any new additions of PCGS coins to his registry. Those who think that was reason why he took that action will nod their heads. The rest of us will classify it as a marketing campaign rant.
Please use this thread to discuss this topic:
https://forums.collectors.com/discussion/974818/anyone-read-the-mark-salzberg-article-that-came-out-today#latest