More than a year ago, the Guest Commentary in the Dec. 10, 2012, issue of Coin World, by Tom Deaux, contained one of the best explanations of the About Uncirculated grade as it exists today.
As an improvement, Deaux suggested: “The AU part of the scale from 50 to 59 should reflect the characteristics in the Mint State part of the scale from 60 to 69. In other words, an AU-50 coin should look a lot like an MS-60 coin, except the AU-50 coin will have slight wear where the MS-60 does not.”
I intended to reply in support of his novel ideas, but I procrastinated. Please allow me to bring up his idea again. Perhaps this will draw others into a discussion. I believe the attempt to value a coin by assigning a numeric grade is the root of many problems with grading today. It is unfortunate that we can’t just grade coins according to their condition of preservation and let professional coin dealers price them. Then, a circulated coin with loss of original luster and detail can be priced as a Mint State 65 coin because of its rarity!
Mr. Deaux expressed another inconsistency between a coin’s grade and its value: “In reality, the value of coins in the AU range also overlaps the value of coins in the Mint State range; and a nice AU coin can be worth more than a lower grade MS coin. This occurs when the AU coin has better eye appeal and fewer marks than the Mint State coin.”
Ask why coins are graded and most will reply, “So we can tell what they’re worth.” The connection between value and grade is an old one. The 1 to 70 system devised by William Sheldon was developed as a guide to value early large cents. In his system, the value of a coin in Fine 12 cent would be 12 times the price of one in its lowest condition. A Very Fine 20 cent would be valued at 20 times the price, and so on. Eventually, Sheldon’s numbers became “shorthand” for the grade of all coins.
In 1973, I used Sheldon’s numbers and descriptions to devise the Technical Grading System we used (in addition to a photograph and weight) to identify coins at the American Numismatic Association Certification Service. Our Technical System had no relation to a coin’s value! It was strict and sought only to describe a coin’s “condition of preservation.” A circulated coin’s grade was determined by the loss of detail due to friction wear, which would not change over time as long as the coin remained the same. Modifiers were added to the technical grade to describe variables such as “flat strike” or “scratched.”
A coin with “a trace of wear” was graded AU-58. A coin with more wear graded AU-55, and so on. One coin could be graded AU-58, heavily bag marked, cleaned and stained; while another with blazing luster and virtually no marks (considered to be Mint State by many today) was graded Choice AU-58. Our grading was consistent, precise and the standards did not “evolve” over time! Our “time-tested” standards were carried over and used at the International Numismatic Society’s Authentication Bureau — the first third-party coin grading service.
Unfortunately, when the ANA Certification Service was moved to Colorado, new employees had no understanding of the Technical Grading System. This became apparent, when the ANA Grading Guide was published. The “Technical System” was “bastardized” when graders added the variable of “surface condition” (number of marks) into the numeric grade for circulated coins. Thus, an AU-58 coin described a “Very Choice,” virtually mark-free coin while an AU-50 or “AU Typical” coin had many more marks. By the ANA’s definitions, a sight-unseen buyer would not know what a coin graded AU-50 looked like! Tom Deaux explains that an AU-50 coin could be heavily bag marked with only a tiny amount of wear or a well-worn borderline Extremely Fine coin with fewer detractions.
Over time, the marketplace seems to have taken care of much of this problem and moved toward the solution proposed by Mr. Deaux; but I should like to see his idea fully adopted. Deaux wishes to treat the About Uncirculated grade as we do the Mint State coins. In this way the surface condition and “look” of the coin can be easily determined by a designation such as “About Mint State 64.” This system will work splendidly on the condition that we redefine the AU grade back to its original meaning.
Once, the AU grade didn’t exist. A coin’s condition went from Extremely Fine to Uncirculated. The About Uncirculated grade came about to describe coins with a slight amount of friction on their high points — the “liners” between Extremely Fine and Uncirculated. As grading evolved, the tiny segment originally carved out for the AU grade was expanded to encompass most of the former EF range.