US Coins

Monday Morning Brief for October 15, 2018

This 1929-D Walking Liberty half dollar in PCGS MS-67+ with a green CAC sticker brought $82,250, an improvement on the $44,400 it sold for earlier this year at auction when it was graded by PCGS as “just” MS-67.

Original images courtesy of Legend Rare Coin Auctions.

Try explaining the modern concept of coin grading to a noncollector and you are likely going to be faced with bewilderment.

From time to time, I get a phone call from someone who has a coin and a price guide, and who is certain that their coin is extremely valuable. When I ask them the condition of the coin, they invariably will say that it is in “good” condition, which — as most readers of this column understand — means something entirely different than a coin in “Good” condition under current standards. For collectors, Good means “well worn,” placing it at the very bottom of the 1–70 grading scale, generally Good 3 or Good 4. Since most of these callers have no experience in judging wear on a coin, they also have no clue as to where their coin would rank on the grading scale.

Being optimistic, many of these callers will look to the far-right columns in whatever price guide they have, in the regions occupied by grades at the upper range of that scale. Explaining that it is entirely possible that the same coin could be worth, say a few tens of dollars in the lower grades and tens of thousands of dollars or more in the upper grades — well, that is difficult. They might ask, how can an 1887-S Morgan dollar, for example, be worth less than $25 at the bottom of the scale and bring upwards of $6,000 at the upper range? 

It gets especially difficult when you explain that a difference in grade by a couple of points in those upper ranges can mean the difference between an 1887-S Morgan dollar worth $275 in Mint State 63 and $600 in MS-64 and $6,000 in MS-66. Add the concept of deep mirror prooflike to the equation, where a regular MS-65 1887-S Morgan dollar might be worth $1,800, while one in the same numerical grade but bearing deep mirror prooflike surfaces might sell for $27,500 — well, I have been in this business for more than 40 years and I still do not know if I fully get all of this. I know many collectors would agree with me.

That is because grading has become increasingly complex over the years. In that 70-point grading scale, grading services now recognize 11 different levels of Mint State from MS-60 to MS-70, whereas a few decades ago, MS-60, MS-63 and MS-65 were “good enough” for most.

Today, unsatisfied with 11 levels of Mint State, services might also award a coin a + or a ? following the numerical designation. 

Then there are the certification firms that certify certified coins, that place a sticker on a coin signifying that the new certifier agrees with the original certifier’s opinion on the grade. The stickers might even be of a different color, with green meaning one thing and gold meaning something else. (The whole concept of firms certifying certification would probably have been judged outlandish when the original grading services were founded in the 1970s and 1980s, but today it is widely embraced.)

Readers question a lot of these changes to grading. Josh Cook, in his letter on Page 15, questions some these aspects of third-party grading. He references a hypothetical coin graded Mint State 66 by one of the major services. Cook notes that it might or might not have a sticker from the Certified Acceptance Corp., one of the companies that certifies third-party certified coins, with the firm attesting that the coin was graded accurately. 

He furthermore notes that some MS-66 coins might bear a + sign after the numerical grade, an indication that the coin is especially nice for the stated grade. An MS-66+ coin, like the one lacking the + sign, might or might not bear a CAC sticker.

In a not-so-hypothetical situation, last week, in his Market Analysis in the Oct. 22 issue of Coin World, editor-at-large Steve Roach wrote about a 1929-D Walking Liberty half dollar that has sold at auction at least twice this year. In April, the coin was in a PCGS slab with a grade of MS-67, with a green CAC sticker affixed to the slab; it sold for $44,400. The same coin resurfaced in September in another auction, this time bearing an MS-67+ grade from PCGS (and a green CAC sticker); in this second outing, the same coin sold for $82,250, surpassing its upper estimate by more than $10,000.

Now, various factors could have been at play in the coin’s two 2018 auction appearances, but the most likely explanation is that in its second outing, bidders thought that the addition of a + sign made the coin worth almost double its earlier result. In April, the coin was one of two graded MS-67 by PCGS; with the addition of the + sign, it became the finest known example, and bidders were willing to pay accordingly.

Ultimately, though, we have to remember that grading is subjective. The same coin can be submitted multiple times to the same grading service, until it comes back with a higher grade than it received in earlier submissions. But it can also come back with a lower grade.

Grading is important. But I understand why so many collectors are wary of today’s grading system. 

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