Author Topic: Are Too Many Pandas Being Graded?  (Read 17451 times)

0 Members and 1 Guest are viewing this topic.

KonaJim

  • Guest
  • Trade Count: (0)
Re: Are Too Many Pandas Being Graded?
« Reply #15 on: May 04, 2011, 10:23:50 PM »
I just want to say I have bought many fantastic coins from Germany, and Austria.  I think it is in poor taste to generalize about cultures, peoples, or practices.  My apologies to our European friends for the poor treatment by some of our members.

Offline badon

  • Trade Count: (0)
  • Hero Member
  • *****
  • Posts: 4487
  • Karma: -81
Re: Are Too Many Pandas Being Graded?
« Reply #16 on: May 04, 2011, 10:36:32 PM »
Bah, yeah, I feel like an idiot. Thanks for stepping in KonaJim. Apologies all around.

Offline dobedo

  • Trade Count: (+2)
  • Sr. Member
  • ****
  • Posts: 441
  • Karma: -2
Re: Are Too Many Pandas Being Graded?
« Reply #17 on: May 04, 2011, 10:44:54 PM »
It is indeed in poor taste to generalize about cultures and peoples. However, poor coin handling practices shall be pointed out so we may be enlightened and not to repeat them. On behalf of my European friends, I accept Jim's apologies and condamn all mistreatment to our coins.

Offline pandamania

  • Trade Count: (0)
  • Full Member
  • ***
  • Posts: 243
  • Karma: 4
Re: Are Too Many Pandas Being Graded?
« Reply #18 on: May 05, 2011, 12:41:54 PM »
Feedback on the issue from the US favors the grading process. Response from China has been limited but leans toward original packaging.

Looking at it from the viewpoint of a contrarian would it be wise to keep coins with obvious quality from grading until one has a better feel for the long term preference of Chinese and European buyers.

In other words in the long run (except for perhaps the rarer coins) will grading turn out to be a US phenomenon?


Offline badon

  • Trade Count: (0)
  • Hero Member
  • *****
  • Posts: 4487
  • Karma: -81
Re: Are Too Many Pandas Being Graded?
« Reply #19 on: May 05, 2011, 01:25:43 PM »
In other words in the long run (except for perhaps the rarer coins) will grading turn out to be a US phenomenon?

I don't think so. For example, in the USA even now, grading is really most important for the rarer coins too, so I'm sure the pattern will repeat. The coins that aren't so rare aren't worth counterfeiting, are available in any grade you want, and getting them certified at PCGS or NGC doesn't add much value. That's pretty much the way it is now in the Chinese market too.

So, I think you're right that there's a difference in the importance of grading, based on the value of the coin (rarity). But, I don't think that's just in China, or just in the USA - it's true everywhere. At the very least, it's BULKY to try to transport and store a bunch of common coins that sell just as well in a pile as they do in a fancy holders.

The importance of certification increases greatly with price, and price differences, as well as the risk due to fakes. I think that will always be true, everywhere, at all times.

For example, independent 3rd party verification is not just something that exists in coins - it exists in all markets where there is some complexity involved, and significant amounts of money. In real estate, diamonds, art, antiques of all sorts, etc. The coin market just happens to be one that's close enough to being a commodity market that it's possible for there to exist commodity-style authentication, where every holder uses the same grading system, etc.

In other words, I am absolutely 100% convinced beyond any doubt whatsoever that certification of coins is, or will become, the standard practice forever when dealing with anything of significant value or differences in value. That doesn't mean it will only apply to expensive coins, though.

For example, a recent date modern coin might cost 4 times as much in a 70 grade versus a 69 grade. And, the 69 may cost 4 times as much as a 68 grade. If the coin is only worth $10 in the 68 grade, then that's easily enough to make it profitable for a dealer to send in coins that may earn the 69 or 70 grade. With bulk pricing, it could be profitable to send in the 68 coins too, and just cut out the 67 and lower grade stuff to sell ungraded in their original packaging.

For the 67 and lower grade stuff, ungraded, one without the original packaging may be worth $2, but one with the original packaging may be worth double.

So, in short, I think it's VERY easy to make the argument that certification is the way of the future, regardless of the way things are now. But, it's not so easy to make a similar argument that says it's NOT the way of the future. I tried, a long time ago, and I very quickly became convinced that I was wrong.

It's only a matter of time before every coin of any significant interest will become "certified" in some way. It may by NGC and PCGS that continue to dominate that market, or it may be that competitors gain traction. ANACS seems to be well-liked, even though they're nowhere near as popular, for example. I would be interested to see a Chinese competitor enter the market.

Also, it could be that something entirely new takes over someday. I'm still working on the coin compendium, which will help fulfill the role of authentication at least, and maybe I can figure out a way to make it help fulfill the role of grading too. We shall see.

Wouldn't it be cool to have grades registered for a coin from more than one grader? I think the quality of grading would greatly improve that way.

Offline pandamania

  • Trade Count: (0)
  • Full Member
  • ***
  • Posts: 243
  • Karma: 4
Re: Are Too Many Pandas Being Graded?
« Reply #20 on: May 05, 2011, 02:34:59 PM »
Badon - Truth be known I agree with you, Jim and the consensus about the virtues and value of grading/conserving. However we need to always look at the contrarian viewpoint because it is very often the right call. - Pandamania

Offline badon

  • Trade Count: (0)
  • Hero Member
  • *****
  • Posts: 4487
  • Karma: -81
Re: Are Too Many Pandas Being Graded?
« Reply #21 on: May 05, 2011, 05:32:50 PM »
Yes, that's true. It's also helpful to revisit these topics from time to time, so we can discuss them to determine if anything has changed since the last time we talked about it. Also, many people reading these forums are new, so the fresh discussion will help them learn about the pros and cons of grading.

Offline Grip

  • Supporter
  • Trade Count: (+4)
  • Sr. Member
  • ****
  • Posts: 576
  • Karma: 6
Re: Are Too Many Pandas Being Graded?
« Reply #22 on: May 05, 2011, 06:38:25 PM »
I've noticed that the lower graded rare coins(67-68) sell at a significant discount to the 69's. As a collector, I want a good looking coin and am not interested in paying the huge premium to have the best grade. Many of these coins are seldom offered regardless of grade, so I think collectors can get some real bargain prices by buying the 67-68's. For this reason alone, I think the coin grading is currently helping collectors add undervalued coins to their collection. Any graded coin has established credibility and is worthy of consideration to add to your collection- look at the coin, not the grade. I just had a 2002 1 oz gold Panda grade at 66 because of a small rub spot, it's a beautiful coin! I do agree that set's are a different beast in that they are more appealing in a presentation box than a series of slabs. Graded coins have their place as do raw coins. Have a good mix and enjoy the discovery!!! 

Offline badon

  • Trade Count: (0)
  • Hero Member
  • *****
  • Posts: 4487
  • Karma: -81
Re: Are Too Many Pandas Being Graded?
« Reply #23 on: May 05, 2011, 07:24:04 PM »
I also want a good looking coin, but I have such picky taste that I notice every little flaw. I can see the difference between 69 and 70 coins in my collection, and I like my 70 coins more. I always get better looking coins on average when I buy 70 coins.

68 coins are sometimes kind of ugly to me, though there are good looking ones out there. I've seen some nice 67 coins too. I would consider owning a 68 for something special, and I do have just one of those in my collection now, only because it's so hard to replace with a 69.

Offline DiggingNorway

  • Trade Count: (0)
  • Full Member
  • ***
  • Posts: 384
  • Karma: 1
  • Gender: Male
    • Gold Source
Re: Are Too Many Pandas Being Graded?
« Reply #24 on: May 07, 2011, 03:36:35 PM »
as a European collector I am not offended by badon's, lets call it "reflecting his passion for coin preservation", comparison. I think its good that Americans can triumph in atleast one arena w.r.t to culture  :lol:   , seriously:

I have bought all my chinese coins RAW in Europe and sooner or later I will have them conserved and graded, it will be very interesting to see if they get "bashed" and get low grades... hopefully one or two might get a high grade... but considering the low price I have paid for them I will not jump off a cliff it they dont.... however, I think Badon is right: the top top coins (70s and 69s) will eventually become so expensive that it will only cater to a small part of the growing amount of people who wants to collect chinese coins.

So regardless of grade-score, coins that are graded, conserved and authenticated and in "mint state" between 64-68 will still have many people wanting them, and still be rare and still be expensive. Its simply a matter of mintage and demand. So while high graded coins are rightfully sold for high premiums today, that does not mean one should not buy raw coins at reasonalble prices and grade them, even if they get a 66 grade, they will still be rare...Thats my two cents... :thumbup:




Offline badon

  • Trade Count: (0)
  • Hero Member
  • *****
  • Posts: 4487
  • Karma: -81
Re: Are Too Many Pandas Being Graded?
« Reply #25 on: May 07, 2011, 04:12:03 PM »
Yes, I think within another 18 months or so, "investment grade" will mean 68, simply because all the 69's are already off the market. In particular, some of the top investment coins are actually available only in 68 or lower, so it's already starting to happen. The large size coins are the best example.

The 1989 3.3 oz silver god of war & wealth clouded claw and super clouded claw is very hard to find in any grade, but 68 and 69 grades are almost EXACTLY the same in rarity. Obviously the 69 is preferred, but if you can find a clouded or super clouded claw in a 68 grade, I think it would have to count as investment grade. Oh, but that's a "large size" coin...

For small size coins, the 1989 Chinese historical figures coins are very difficult to find in 69 grades. 68 is probably investment grade right now. Any series of silver small size coins that mostly went to Europe will be hard to get in 68 grade or higher.

Offline DiggingNorway

  • Trade Count: (0)
  • Full Member
  • ***
  • Posts: 384
  • Karma: 1
  • Gender: Male
    • Gold Source
Re: Are Too Many Pandas Being Graded?
« Reply #26 on: May 07, 2011, 04:28:59 PM »
Badon; you know I have lots of ungraded coins... and I look at them, and some of them I can tell has "markings", like... weak toning along the rim, or "die scratches", thats like small thin short lines gowing outwards from the centre and out towards the rim, my dealer told me it came from the production.

then again, some of the gold coins have obvious "cobber" staines.., but for the most part... When I examine my coins I can not find any hairlines, spots, fingermarks or other residuals, scratches what ever on them... you say that you can tell the difference between a 69 and a 70, right?

There are two sources for downgrading: 1) Production and 2) Handling afterwards, I know you say that Europeans touch their coins and play poker with them, use them under tables to straighten them up and so on... but seriously: some of the coins that were taken in by european dealers must have been from "good strikes" too, right? thus eliminating source no. 1. And if the buyer has not played around with the coin, there must be some chance that some of the coins will get a 68 or 69 grade?? I keep looking at them and honestly, 6-7 out of 10 seem like they have not been subject to source no. 2 (handling).

if grading-services are to be considered legit, "normal" people must be able to look at a 67 grade , and a 70 grade, of the same coin, and think "wow", that 70 is a beauty, and "yes - I can tell why that coin got a 67"... since I dont own any graded coins, and it is impossible to go to a coin shop in Norway and compare two equal coins with different grades, the whole grading thing is a mystery to me... can someone PLEASE post a photo of a 67 coin and 70 or 69 coin (same coin) and rationalize the grading deviation??

 :confused1: :crying: :001_rolleyes:

like this one... I cant find anything wrong with this coin... I think maybe Europeans need to be exposed to more graded coins so they can see the difference before they respect and understand the whole concept... in chinese coins that is impossible since there are no places to go and really see for your self the difference between a 69 and a 67...

Offline badon

  • Trade Count: (0)
  • Hero Member
  • *****
  • Posts: 4487
  • Karma: -81
Re: Are Too Many Pandas Being Graded?
« Reply #27 on: May 07, 2011, 04:46:55 PM »
The hairlines can be difficult to see. You can't use fluorescent lighting. The hairlines show up best in sunlight, or with clear (not white) incandescent light bulbs without a shade. When you turn the coin, you will see "streaks". When you look closely with a loupe, the "streaks" will be distinguishable as very fine parallel scratches. It can be very difficult to see hairline scratches, even for an expert. Sometimes when they're very hard to see, the graders will give the coin a 69 grade.

It's hard to find a flaw until you get to 67 grades. With a 67 grade, you should be able to easily find a scratch or other mark on the coin somewhere. The problem with grading these coins is that they're usually 64 or better. At that grade level, you can't see flaws through the plastic very easily. It REQUIRES handling outside the protective holder to find the flaws.

So, it's best to leave high-end grading to the experts, since they're also expert at handling the coins without damaging them. I have found a few coins from Europe that are not damaged, so it would not surprise me if there are some that are in good condition. I think it's about 1/3 or 1/2 that might get a good 68 or 69 grade at NGC.

Keep in mind that even of coins that have NOT been handled, many do not get the precious 69 grade. I'm starting to suspect that you have a good eye for quality, DiggingNorway. That may mean that you are selecting better-looking coins from the inventories of dealers that you buy from.

Yes, I can tell the difference between a 69 and 70 coin, but not from photos. I do NOT claim to be able to grade them, but with two coins side by side, I can find the differences, at the very least. I can usually tell when a coin is under graded or over graded too.

I have had a career in manufacturing, and many of the things I have dealt with required perfect mirror finishes. The slightest hairline scratch would cause a disaster, so the metal parts required thorough inspection for flaws. That gives me an advantage in both seeing flaws, and knowing exactly what they are.

For example, those radiating short lines that come from the center and go out to the edge are not actually "scratches". They're die wear, and/or grinding/polishing marks. Dies that are new usually do not have them as much as dies that are older. They do not count for grading the coin, since they are not damage to the coin. Sometimes it can be quite attractive. It's what gives American Morgan dollars their "cartwheel" luster:



On the Morgan dollars the marks are very small, and blend together to form a nice reflective pattern.

Offline DiggingNorway

  • Trade Count: (0)
  • Full Member
  • ***
  • Posts: 384
  • Karma: 1
  • Gender: Male
    • Gold Source
Re: Are Too Many Pandas Being Graded?
« Reply #28 on: May 07, 2011, 04:59:32 PM »
"Keep in mind that even of coins that have NOT been handled, many do not get the precious 69 grade. I'm starting to suspect that you have a good eye for quality, DiggingNorway. That may mean that you are selecting better-looking coins from the inventories of dealers that you buy from. "

thanks for the compliment and your answer badon, but its not entirely deserved as my strategy is to simply to buy every coin I can get my hands on as long as the price is metal-spot price, which 80% of my coins are purchased at... sometimes (after a few beers) I make some "stupid buys", like paying 70-80 USD for a raw historical, traditional or olympics (or ANY coin really), but thats just a result of pure severe draw-back symptoms after not having been able to score a bargain for a month or so...

i think (after all my rabbling) the main point for European collectors to appriciate and start to grade their coins to a higher extent must be that more graded coins must come to market so people can see the difference and that the third-party service suppliers retain their credibility and provide consistent grades. As for original packaging my approach is to keep them, and if/when I send in for grading I will keep the packaging (box, coa) and keep them separate from the slab and sell them combined.

Offline pandamania

  • Trade Count: (0)
  • Full Member
  • ***
  • Posts: 243
  • Karma: 4
Re: Are Too Many Pandas Being Graded?
« Reply #29 on: November 26, 2011, 01:56:42 PM »
It`s time to update the original question asked in this topic. This also involves a number of previous CCF topics.

I believe that it is fair to say that Ebay US is the predominant market maker in Chinese Pandas. Given this and presuming that most Panda coins were minted for export and currently reside outside China (mostly in the US):

Panda Whereabouts

http://china-mint.info/forum/index.php?topic=1421.0

then the US must be the presumed leader with regard to the Panda and grading market. These topics also enter the picture:

Are Too Many Pandas Being Graded? (This topic):

http://china-mint.info/forum/index.php?topic=2758.0

Graded Coins in China:

http://china-mint.info/forum/index.php?topic=1262.0

China Dealer Coin Supply:

http://china-mint.info/forum/index.php?topic=2176.0

This brief analysis is not intended to be a thorough research of the issues but is a quick thumbnail update of a number of previously posed questions. Any conclusions drawn from it must be viewed with a cautionary eye.

Currently on Ebay US there are about 3800 listings under the search title of "panda" in the "coins and paper money" category. We can subtract about 400 items that are not actually coins/medals i.e. COA`s, boxes, 1 gram items, replicas, art rounds etc., leaving us with approximately 3400 coins/medals.
By plugging in MS and PF designations (graded coins of which there are about 1700) we derive that 50% of the pandas appearing on Ebay US are graded. Over the past year, two years and particularly 3 years this figure has grown continually and significantly (there were few graded pandas 4-5 years ago). The predominant Ebay US dealers located in China currently are Xuhong and Naomi01225. Xuhong has about 325 pandas listed (net of non coin items and Naomi01225 has about 85. Xu`s inventory contains only 9% graded coins and Naomi has none, or a combined 7+% in inventory for Chinese dealers. If we can assume that most (if not all) of Chinese dealer`s inventory on Ebay US was acquired within China then what do the comparative percentages of 50 vs 7 mean?

Are most quality coins in the US being processed through NGC/PCGS and quickly brought to market because of the value differential? Do US panda owners presumed preference for graded coins translate into where the worldwide market is heading? Why are there only 7% graded coins in China dealers` inventory and will this increase? How many quality non graded pandas in their original packaging still exist outside China and how will this affect their future prices?

When scrolling through the new Panda listings on Ebay US the number of graded coins continue to increase and the number of ungraded coins continues to decrease (particularly pre 2000 coins) In general, the premium for graded coins over ungraded coins in OMP appears to be narrowing.

Given the changes which have occurred and the fact that these questions continue to be debated on CCF this is where we currently stand on the basic questions of "are too many pandas being graded' and "how well received are graded coins in China" All must draw their own conclusions and from the concensus the future of the market will evolve.