Coin Clinic: Gold terminology might be confusing

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By Richard Giedroyc

What does it mean when a medal is described on its certificate of authenticity as being layered in gold?

This is one of many ways to get around describing the medal as being gold-plated without getting into legal trouble over how the medal is being marketed.

We are in the age of computers. I can’t believe coin values are still being tracked through weekly, monthly and annual hard copy publications rather than through something similar to how the stock and commodity markets are reported electronically. Is there a reason this wouldn’t be practical, or should someone be developing some way of reporting pricing that is more up to date?

When trading stock or buying and selling commodities you have a consistent product to track. You are selling an exact number of shares of a stock of a specific company. You are selling a measurable amount of a specific commodity. Since these transactions are comparing apples to apples (the same stock or the same commodity) the value of every trade is consistent to the consistent product. The problem with coins is that not every trade of a specific denomination, date, mintmark and grade is for a consistent product. Two supposedly identical coins assigned the same grade by a certification service may not be as equal as you might like. Perhaps the toning is different. Perhaps one is a borderline piece that comes closer to the next grade than does the other. This would become a challenge to some way of reporting “live” trades. Since coin dealers are not licensed as are stock and commodity brokers and there is no stock or commodity market through which coins trade exclusively the accuracy of reporting transactions would also be incomplete and likely unreliable.

Since you are saying even two coins assigned the same grade may be significantly different as to command two different sale prices, doesn’t this indicate the hard copy values available through various publications aren’t accurate either?

Use all published coin values as a guide, not as an absolute. Even trades in bullion coins don’t’ always follow the bullion market prices. Since bullion prices change continuously a published price is an attempt to hit a moving target. Published coin values are raw data that needs to be interpreted when a transaction is about to take place. Just because a coin sold in a recent auction for a particular price doesn’t ensure your like coin can realize the same value.

Would it be helpful to have a person who can examine your coins and apply this published raw data to determine their true value?

This is what makes the coin market so fluid; the idea that the value of coins is based on their assessment by the potential buyer and seller. Of course, there is perceived value on the part of each party to the transaction. If this perception holds reasonably true based on the opinion of the both parties then negotiations follow rather than simply accepting a set price. This is what separates valuing antique items (including coins) from commodities, stocks and bonds.

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