Author Topic: PCGS handing out a lot of 70 grades?  (Read 14634 times)

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Offline poconopenn

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Re: PCGS handing out a lot of 70 grades?
« Reply #15 on: January 24, 2014, 03:21:12 PM »
The other day, I looked at the PCGS population report for MCC and found it interesting that PCGS has recently been awarding a lot of 70 grades.

For example:

1995 5 Yn Silver panda Small Date Frosted Gap:  PCGS population of MS 70's recently jumped from 0 to 5 (NGC has graded 0 as MS 70)

2001 10 Yn Silver Panda Small D: PCGS population of MS 70's recently jumped from 0 to 12 (NGC has graded 3 as MS 70)

2013 1 Ounce panda coin expo: PCGS MS 70 population is 7 (NGC has graded 0 as MS 70)

Has anyone else noticed this? Could the large number of PCGS 70's be due to more liberal grading at their recently-opened centers in mainland China?


Frankly, I can not see the change of MS70 in population report as evidence of PCGS has lower its grading standard, while no MS70 in NGC’s population report is an indication of more conservative grading standard. Perhaps, somebody can post pictures of the same grade coin (MS68-70) side-by-side to demonstrate the differences. Buy the coin, not the holder or label.

Here are a pictures of NGC graded 1912 Li Yuan Hung. The coin was over-graded significantly if the coin is genuine. (Imo, this is a questionable coin in a genuine NGC holder.). The pictures of PCGS genuine but ungradable also attached for comparison.

ANA definition of AU is “50% luster of silver coin still shown and no wear in design details. As shown in the picture, there is very little luster on the surface and the details, such as hair is not visible. The marked area suggests this coin may be questionable.

Please note that Imperial and Republic coins are just as liquidity as MCC inside China and PCGS is definitely being considered as favorable grading company among collectors.

Offline poconopenn

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Re: PCGS handing out a lot of 70 grades?
« Reply #16 on: January 24, 2014, 03:50:52 PM »
Missing picture from the previous post.

Offline Birdman

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Re: PCGS handing out a lot of 70 grades?
« Reply #17 on: January 24, 2014, 04:06:00 PM »
Frankly, I can not see the change of MS70 in population report as evidence of PCGS has lower its grading standard

The single example that was most compelling to me was that there was only 1 PCGS MS70 1990LD G1/20 for years, and then in one submission 8 of 9 of the 1990LD G1/20 graded MS70 (PCGS #28987759-28987767).  That, in combination with a number of other similar anecdotes, is difficult to explain outside of grade inflation.

http://china-mint.info/forum/index.php?topic=9771.0

Offline davidt3251

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Re: PCGS handing out a lot of 70 grades?
« Reply #18 on: January 25, 2014, 12:36:48 AM »
Within China both conditions 1 and 2 are satisfied. The market there is more than 1 billion people. I would call that liquid. If a grading company is successful it will be easy to sell or buy the coins they grade. If the company fails then liquidity for its products is quite limited. NPGS is a new company. So far its products are liquid. I personally believe that in the long run quality and consistency will determine the success of a grading company and the marketability of its products.

Do you know what eBay's market share in China is? Essentially zero. A decade ago they were swept away by a then much smaller Chinese competitor, Taobao, after losing $300 million. There are other measures of market share, or liquidity, than eBay.

Best wishes,
Peter Anthony
China Pricepedia
www.pandacollector.com


Peter

1 billion people isnt a market when 14% of them live on $1.25 or less a day (World Bank data, 2008). Chinese GDP (2012) is $6,000. US GDP is $50,000.

NPGS cant access 800 million people in Europe who, on average, have a GDP 10x China, the buying power of 8 billion Chinese, but they dont recognize NPGS.

I also realize there are other marketplaces than ebay in China. In Japan there is Yahoo as well. Then there are the big auctions like Heritage, Stacks, Hosane, etc.

In China on Taobao, in Yahoo Japan, and on ebay, and on those auctions, we find PCGS and NGC. But NPGS is scarcely found on ebay and Yahoo Japan. I have not seen NPGS in auctions.

If an American or European buys a collection of NPGS coins instead of PCGS or NGC, their sales avenues are a fraction of what is available for PCGS and NGC sellers.

There are many Chinese NGC and PCGS sellers on ebay and in auctions. If NPGS was so great and so liquid, why dont they put NPGS up for sale then?

It is because there is poor price discovery. It is because the NPGS brand isnt recognized outside of China and the seler will suffer a lower realized price. So, if a Chinese person has an NPGS MCC that is say a coin that begins appreciating in many markets, the NPGS holdered coin will have difficulty identifying buyers in the markets where NPGS isnt recognized. Therefore price discovery is impaired. Therefore, the first definition of liquidity:

"The degree to which an asset or security can be bought or sold in the market without affecting the asset's price."

-is impaired, and thus the item is illiquid.

Maybe one day there will be more silver Pandas minted than ASEs, but lets not get ahead of ourselves.

-David

Offline poconopenn

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Re: PCGS handing out a lot of 70 grades?
« Reply #19 on: January 25, 2014, 01:28:06 AM »
The single example that was most compelling to me was that there was only 1 PCGS MS70 1990LD G1/20 for years, and then in one submission 8 of 9 of the 1990LD G1/20 graded MS70 (PCGS #28987759-28987767).  That, in combination with a number of other similar anecdotes, is difficult to explain outside of grade inflation.

http://china-mint.info/forum/index.php?topic=9771.0


Most long term collectors and knowledgeable dealers do not submit coin to a grading company unless the valuation of the coin is worth the trouble and the condition of the coin is good enough to make a cheap coin to become a grade rarity. IMO, those coins might be submitted by a very knowledgeable collector or dealer who specially picked the coins to make sure those coin will receive a grade at least MS69. For 1990 1/20 oz gold panda, if the coin is not MS69, you actually will not gain financially vs. OMP.

Online PandaCollector

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Re: PCGS handing out a lot of 70 grades?
« Reply #20 on: January 25, 2014, 01:50:21 AM »
David,

I wouldn't recommend to anyone to buy a coin graded by any company that has no grading or authenticity guaranty that I am aware of. I also agree that NPGS coins may be difficult to sell outside of China. However, within China I have seen quite a few NPGS slabs for sale in stores. They also sell without issue online and at auctions, albeit (as far as I can tell) at lower prices than NGC or PCGS.

I don't believe that NPGS has any interest in selling to foreign markets. There may even be some intellectual property issues that hinder them from doing so. The lack of overseas markets may be a long-term problem for the company but for the time being I doubt that they care. The China market is very valuable and that appears to be their target. If another grading company thinks a strategy of handing out higher grades and lowering standards to gain market share is the key to success in China I think they are wrong. There is already a company there (and maybe more to come!) that is already working that end of the business.

I also have to add that the idea that because China has a lower per capita income than some Western countries it's not a market is off base.  China's middle class is larger than the entire population of the USA. As for the rich there are 20 Ferrari dealerships in the country – and the cars cost 3X as much as in the USA. ‘Nuff said. A company in China doesn't need to be global to be enormous. Just look at Tencent or Alibaba.

Best wishes,
Peter Anthony
China Pricepedia
www.pandacollector.com


Offline Pandaguy

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Re: PCGS handing out a lot of 70 grades?
« Reply #21 on: January 25, 2014, 10:24:55 AM »


I also have to add that the idea that because China has a lower per capita income than some Western countries it's not a market is off base.  China's middle class is larger than the entire population of the USA. As for the rich there are 20 Ferrari dealerships in the country – and the cars cost 3X as much as in the USA. ‘Nuff said. A company in China doesn't need to be global to be enormous. Just look at Tencent or Alibaba.

Best wishes,
Peter Anthony
China Pricepedia
www.pandacollector.com




I agree. It is fact that China has many more millionaires, billionaires than USA. The Chinese are great savers of income. Many prople own multiple homes. The fancy Western cars' very high prices does not seem to deter the appetite of the wealthy. The have so much money that the high prices are of no concern to them. Yes, IMHO (and experiences) China is still Third-World in many ways, however China also most likely has the greatest amount of internal wealth created mostly illegally (by Western standards). The payoffs, bribery, blackmail, graft, and corruption that creates many (not all) wealthy Chinese, is widly accepted and common-knowledge. It's like a big club -- namely, the CCP!!!!

Offline davidt3251

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Re: PCGS handing out a lot of 70 grades?
« Reply #22 on: January 25, 2014, 11:04:08 AM »
Peter

"I don't believe that NPGS has any interest in selling to foreign markets"

That reduces liquidity according to the definition. The rest of the world has as many billionaires as China.

Forbes ranking of global billionaires

1. USA 442
2. China 122

http://en.wikipedia.org/wiki/List_of_countries_by_the_number_of_US_dollar_billionaires
http://www.forbes.com/sites/luisakroll/2013/03/09/mapping-the-wealth-of-the-worlds-billionaires/

'Nuff said.

-David

Offline GDG's

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Re: PCGS handing out a lot of 70 grades?
« Reply #23 on: January 25, 2014, 11:48:14 AM »
Pandaguy
>>>I agree. It is fact that China has many more millionaires, billionaires than USA. The Chinese are great savers of income. Many prople own multiple homes. The fancy Western cars' very high prices does not seem to deter the appetite of the wealthy. The have so much money that the high prices are of no concern to them.<<<

Actually that statement is not true. The United States has 3x the number of Billionaires then China and many more Millionaires also. China is also printing a huge amount of money and their real estate market is a ticking time bomb. Rose colored glasses don't cut it in China either.

Offline Pandaguy

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Re: PCGS handing out a lot of 70 grades?
« Reply #24 on: January 25, 2014, 12:53:57 PM »
Pandaguy
>>>I agree. It is fact that China has many more millionaires, billionaires than USA. The Chinese are great savers of income. Many prople own multiple homes. The fancy Western cars' very high prices does not seem to deter the appetite of the wealthy. The have so much money that the high prices are of no concern to them.<<<

Actually that statement is not true. The United States has 3x the number of Billionaires then China and many more Millionaires also. China is also printing a huge amount of money and their real estate market is a ticking time bomb. Rose colored glasses don't cut it in China either.

Please know that many of the current millionaires living in USA have recently emigrated from China for various reasons. This recent CNBC report states that "64% of (Chinese) wealthy have emigrated or plan to emigrate" and "1/3 of (Chinese) super rich have already left the country (China)". So, many of the USA millionaires you are counting are actually "Chinese millionaires". I guess it all depends on how you want to catagorize them. Also, the Chinese real estate market may be a ticking time bomb, but so is our USA stock market! The real estate building boom continues very strong in China today. I have see it every day.

http://www.cnbc.com/id/101345275

Offline poconopenn

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Re: PCGS handing out a lot of 70 grades?
« Reply #25 on: January 25, 2014, 01:03:52 PM »
Here are pictures of NPGS holder. The pictures were copied from current listing at eBay USA.

Offline SANDAC

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Re: PCGS handing out a lot of 70 grades?
« Reply #26 on: January 25, 2014, 02:20:49 PM »
... If another grading company thinks a strategy of handing out higher grades and lowering standards to gain market share is the key to success in China I think they are wrong. ...

Amen!!

Offline cloudtoground

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Re: PCGS handing out a lot of 70 grades?
« Reply #27 on: January 25, 2014, 02:52:10 PM »
Sort of funny but not so funny, I just bought an Asian coin from a dealer in China and it was graded 70, the only 70 graded by PCGS and it may have been graded recently.  It was not cheap, photos looked fine but hard to completely tell by pics.  I haven't received coin yet.

Offline cloudtoground

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Re: PCGS handing out a lot of 70 grades?
« Reply #28 on: January 25, 2014, 02:55:44 PM »
Is anyone mentioning this to PCGS outside of myself?  They may have a rogue office or a problem with a grader.  Corruption is an issue in developing nations.

Offline davidt3251

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Re: PCGS handing out a lot of 70 grades?
« Reply #29 on: January 25, 2014, 03:22:08 PM »
Here are pictures of NPGS holder. The pictures were copied from current listing at eBay USA.

You managed to find one NPGS listing on ebay. Yesterday there were 0.

There is also only one NPGS sale in completed listings on ebay. Thats my purchase :)

PCGS has 1293, NGC 2727 listings according to my search. By one measure thats 1293x annd 2727x more liquid.

NPGS isnt even close to being in the same realm.