Not badly treated

I received a letter yesterday. It was from a reader who says he has collected certified Morgan silver dollars for 10 years.

As you might expect, since it was a letter to me, the writer had a complaint. He could not sell his coins for what he believed they were worth.

He wrote in his letter, “To protect my investment, I decided to pay a little more and collect only certified Mint State coins. It didn’t matter to me which grading service certified them as long as they were nice coins.”

Boy, that statement sent alarm bells ringing in my head. How can you be indifferent to which grading service you use?

He said he went to a coin show with 56 of his silver dollars.

“I can’t tell you how disappointed and shocked I was to leave the show without selling a single coin,” he wrote.

What happened?

Well, he enumerated a few things.

“Several dealers were not buying Morgan dollars, several others only wanted coins that were certified by Numismatic Guaranty Corporation or the Professional Coin Grading Service and a few offered only one-third or less of what I paid for them.”

None of those statements strikes me as unreasonable in the context of a coin show. Some dealers do not handle silver dollars and they honestly told him that.

Other dealers want to handle NGC and PCGS coins. The surprise here is that with 56 slabbed silver dollars that he had not purchased any NGC or PCGS coins in his decade of accumulation. He would have had to work very hard to avoid buying any.

The dealers offering a third of what he paid were setting a price I expect that they believed they could profitably flip them for. Since he found that to be too low, he quite rightly refused to sell.

One dealer appeared to try to help out the letter writer, but the writer does not seem to recognize it.

“One dealer told me since the coins were not NGC or PCGS slabs I should break them out of the slabs and sell them as raw coins. Why would I do that when I paid a premium to get certified coins?”

That is, indeed, an interesting recommendation.

The only reason I can think of that would motivate a coin dealer to make such a suggestion is that the holders the coins came in are perceived so badly in the commercial marketplace that the dealer thought the coins in them would be better marketed as raw coins.

I can only speculate here because I do not have a specific inventory of the coins.

The letter writer finally asks, “These are all very nice coins so what difference does it make which grading service certified them?”

Many collectors have daydreamed for many years about the lack of a real need for third-party grading services.

However, the very success of these private firms shows that people believe that a third-party grading service is a valuable one.

I cannot conclude from the limited facts offered in the letter that its writer was in any way badly treated at the coin show.

Buzz blogger Dave Harper is winner of the 2013 Numismatic Literary Guild Award for Best Blog and is editor of the weekly newspaper "Numismatic News."