US Coins

NGC, PCGS officials discuss state of market, new

Both Professional Coin Grading Service and NGC held luncheons during the Florida United Numismatists convention in Tampa where company officials discussed the state of the market and new innovations offered at the services.

The PCGS luncheon, held Jan. 7, focused on new technologies utilized by PCGS to help detect doctored coins and fakes including the second generation of “the PCGS Coin Sniffer” machine that the firm states tracks organic material such as putty and Blue Ribbon on a coin’s surface. The presentation showed the machine barking when it finds a foreign substance on the surface.

PCGS also introduced a futuristic, $50,000 “Ray Gun” aimed at detecting inorganic substances on surfaces.

Much of the dialogue at the PCGS luncheon was focused on Secure Plus — a new service that PCGS announced in March 2010 that digitally takes a unique “fingerprint” of each coin and enters it into a permanent data base. Neither the coin’s appearance nor grade can be changed without flagging the system. It’s designed as a way to detect artificial toning and other processes used to increase a con’s grade.

David Hall, PCGS co-founder, told the filled room, “Secure Plus works if you want it to work.” PCGS President Don Willis added that he was discussing with at least one insurer a possible 10 percent discount in insurance rates for PCGS Secure Plus certified coins.

Willis said that buybacks under the PCGS grading guarantee for 2010 were about the same as 2009, despite PCGS using new technologies.

During the question and answer forum, when asked about the Chinese counterfeit problem, PCGS acknowledged that coins are coming in, but said that they did not want to publicize the diagnostics of either the coins or the false slabs, to prevent the counterfeits of both categories from becoming better. Hall said after the luncheon, “We’re not going to show our hand anymore,” and that PCGS is done explaining the details of its detection processes.

Also announced was the addition to the $1 million club of the Satin Proof 1907 Indian Head gold $10 eagle that had sold the night before at Heritage’s auction for $2.185 million, as well as the addition of “The Ten Greatest Collections of All Time and the PCGS CoinFacts Condition Census.” This will allow PCGS Registry Set participants to compete with the greatest collections of all time.

Global expansion for NGC

At its Jan. 8 luncheon, NGC’s vice president, Scott Schechter, discussed the strides that NGC has made in establishing itself as a global brand, with on-site grading in Hong Kong and increased traction for its NGC Ancients program.

NGC announced that it had graded its 20 millionth coin and showcased new developments to its Collector Society program and new functionalities to its Web site, including its partnership with NumisMedia to form a price guide and upcoming e-mails to members on the rare coin market.

NGC chairman Mark Salzberg addressed the coin doctoring problem that was central to the PCGS message, saying that it is “not as bad as the media is making out,” before adding that NGC has the problem “under control.” He asked everyone to take a broad perspective on the problem of coin doctoring by looking at the coin marketplace prior to third-party coin grading.

Salzberg clearly defined the areas in the coin doctoring debate that the firm considers wrong: lasering the surfaces of Proof gold coins to remove hairlines, adding details to the head of a Standing Liberty quarter dollar and modifying the bands on the reverse of a Winged Liberty Head dime. He characterized all three as unethical, immoral and illegal, before acknowledging that there is a large grey area that is a perception of what’s acceptable and what isn’t. Salzberg pointed to NGC’s metallurgical analysis as a valuable counterfeit detection tool used in the grading room.

The Satin Proof 1907 Indian Head gold eagle that dazzled at auction the night before was also brought up, as NGC had certified it Proof 67. Salzberg said that it is a wonderful coin and was a “privilege to grade,” adding, “We’re seeing less and less great items coming through the grading room.”

Salzberg next made some comments on a problem that he sees developing in the marketplace with the high prices achieved by common coins that are bringing huge prices because they’re the only ones certified in a certain high grade (see the “Coin Values Market Analysis,” Page 46 of this issue). ¦

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