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Separate coin values from conditions

 (Image courtesy

(Image courtesy

Change is inevitable. Change in some form will occur to the present grading system, just as it has in the past. While I cannot be sure what it will be, the best change would be to separate a coin’s value from its actual condition of preservation, as technical graders did decades ago.

Recently there has been talk about a proposed 100-Point Grading System. According to a book in my library, Grading Coins: A Collection of Readings covering 1892 to the middle 1970s, any proposal for changing how coins are graded is a very old topic – this being the newest.

From what I know, the present 70-Point System that we use today has turned out to be the status quo for the longest period of time with only a loosening of the standards to keep up with the rising value of our coins. This system was based on a scale devised by Dr. Sheldon. When I designed the true, original Technical Grading System used only for internal records in the beginning and then applied at the first coin grading service (INSAB in Washington), I also based it on Sheldon’s System.

Don’t let anyone tell you that grading a coin’s actual condition is difficult. That’s because there are so many resources available today (in books, online, and in grading seminars) compared to the “old days” when most of us were self-taught. After learning what an original coin should look like and what factors (luster, marks, and strike) make up a particular grade, it is just a matter of combining these things and coming out with an answer. This is the subjective part of grading, and each of us has a personal opinion.

Unfortunately, putting a value on a coin (market or commercial grading and net grading) requires more knowledge and is much more difficult to do unless you are a long-time, successful professional numismatist. Thus, AUs are graded as Mint State today to reflect their present value and a strictly XF coin using a photo grading guide is Net graded as a VF due to imperfections that lower its value below the XF level. It’s a very confusing system that I believe was concocted by a collector of Large cents.

Now, I’ll comment on some of the opinions I have seen concerning the newly proposed scale:

1. Coin grading was established to allow the dealers to extract more money from collectors and investors.

This statement is so uninformed that it should be ignored, but I’m using it to add some humor into a serious discussion. Coin grading was around long before it was connected to value. Basically, it was a system to describe a coin when you could not see it. I believe Sheldon solidified the combination of a coin’s condition of preservation with an attempt to quantify its value. It’s too bad that these two goals, describing its condition and assigning a value to it, have stayed linked.

2. We should not only avoid adopting a new grading scale but also eliminate the current one altogether.

I agree with the first part. In my opinion, it is too late to change a well-established system. Unfortunately, the attempt to place a current commercial value on the changing value of a coin over the decades corrupted the system. In an ideal world, the standards of a grading system would not change. A coin graded XF in 1970 would not be graded Mint State today to reflect its changing value. It should be much easier to eliminate the faults of the present system than to throw it out and start fresh. Knowledgeable numismatists will admit with a wink that the multi-million dollar coin they just bought is not actually Mint State, but so what.

3. By making grading so difficult and complex, novice collectors are easily scared off from the hobby.

Actually, new collectors will learn and adopt any system in use. It’s the older collectors who will have difficulty adopting.

4. The only ones that would benefit from this [100-point system] are the grading services.

This is true! However, they set the standards, and they also have changed them. Whatever they decide will happen. I read that folks will quit the hobby. Perhaps we’ll lose a few. But I also remember all the dealers who were never going to sell slabs or have any third party grade their coins. They do now.

Apparently, in the proposed system, the grades below Uncirculated will remain the same. So why change the MS range that has been with us for decades? If it is so hard to differentiate what we have now, how could adding more choices make it simpler? For example, while all MS64s do not look alike, or cost the same, they are now essentially divided into low, medium, and high levels with the addition of stars, pluses, and stickers. Assigning more numbers or decimal points to these coins should not be something that could be done with any precision.

Furthermore, no change is needed at all for the PR/MS70 and PR/MS69 grades. It cannot be divided. That’s because one “imperfection” such as a spot, nick, or hairline and the coin is no longer a 70 unless leeway is allowed for a tiny mint-made “defect” such as a “lint mark.” Add another miniscule imperfection and we are closer to the 68 range. Thus, no pluses or in-between grades are needed here, either.

Perhaps the biggest wrench in the proposed new system is the way the color of a silver or nickel coin is now treated. Many coins are given a grade bump for color that conflicts with their actual technical condition. How will a new system signify the added eye appeal of color to a number? Isn’t that what a star does now?

From what I have read so far, most collectors do not favor any change to the present system. I agree, but time will tell.

This article was originally printed in Numismatic News. >> Subscribe today.

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