Over 200 Years Of Combined Numismatic Experience At Your Disposal.
|October 2016 Issue|
Thoughts About CAC
I am very happy to have the summer behind us. It’s always a challenge to go through the quiet time for the coin business. I’m glad customers get in their hard-earned time off and recharge. Yet, it really puts a wrench into the business we do.
This year, I decided to do something a little differently. We ramped up our Coin World advertising with two full page ads in August and September. Both issues surprised us. The August issue, in particular, was very well received. Not only did business from the ad exceed expectations, but we had almost 40 new subscribers sign up for our newsletter. I was very happy to have new customers give us a shot. The September ad was not as well received, but it came on strong at the end.
Something of concern was how little people knew about CAC (Certified Acceptance Corporation) or how some clients thought it was a gimmick of some kind. I guess newer clients to our company were surprised by how many CAC coins we had in our ad, so they were happy to give us their opinion when we asked what they thought about CAC-approved coins. The two main questions about CAC were, “why is it necessary?” and if I have coins that are already graded by PCGS or NGC, “why is CAC so reluctant to sticker more certified coins?”
The first question is “why is CAC necessary?” As a collector or buyer of coins, now and before I became a dealer, I wanted to learn as much about grading as possible. The better the grader I am, the better the desirability of my collection and the value of my collection becomes greater. CAC is a company that affixes a sticker to the grading holder to differentiate the high-end quality coins for the grade from the average or low-end quality coins for the grade. I have collectors that equate it to an “A” coin for grade from the “B” and “C” coins for grade. I personally see it as a necessity because I want a client to know that we want to sell the most conservative and strictly graded coins that we can find. Commercial grading is rampant in the industry. A commercially graded coin may have good eye-appeal because it is bright, but it is not original. We prefer to stick with original surfaced coins because we feel that we are stewards for future generations of collections. This subject of grading coins will be a never-ending debate. It is something on which we will touch over and over again as time goes on.
The second question is “why is CAC so reluctant to sticker more PCGS or NGC coins?” I don’t feel that CAC is reluctant to do it at all. If more coins were high-end for the grade, more coins would get a sticker for the grade. For years, dealers such as RCNH have always preached that collectors should buy the coin, not the holder. We always believed that premium quality coins would hold up better than average or below average coins for the grade, and this has always been true. I have been in the business since 1979 as a full time numismatist, and I can never think of a time when collectors assembling the best coins they could afford ever wanted to compromise and settle for low-end coins for the grade.
Keep in mind, CAC makes it very affordable, too! For coins below $10,000 in value, the charge is $12.50, plus shipping. For coins valued over $10,000, the charge is $25, plus shipping. To me, it is money well spent. A smart buyer would examine a CAC coin and compare it to non-CAC pieces of the same grade. If you cannot see a difference, find a dealer that will explain the difference to you. Once you are able to differentiate between high-end and low-end for grade, your collection and desirability for it will be greatly enhanced.
I’d like to wrap this up with a quote from the latest Rosen Numismatic Advisory. It is on page 6 of the Sept./Oct./Nov. 2016 issue. The quote is referencing the percentages of coins submitted to CAC for Proof 19th Century Type coins and the CAC sticker or pass rate for these series. They ranged from a low of only 8% of the “No Motto” quarters in Proof-67 passing the CAC muster to a high of 37% of Trade Dollars in PR-64 receiving a CAC sticker. I thought the follow-up paragraph by Maurice Rosen was very telling:
“The CAC’s low pass rate Types are a fine place to start looking for good investments. Particularly appealing pieces regularly bring big premiums. Three such coins were auctioned by Stacks-Bowers at the ANA in Anaheim. An 1864 No Motto $, PCGS PR-65 realized $28,200 ($9,500 CDN bid, + 197%). An 1870 With Motto $, PCGS PR-64 brought $18,800 ($5,250 CDN bid, + 258%). And an 1883 Trade $1, PCGS PR-65 went for $11,162 ($5,750 CDN bid, + 94%). Granted these are not your “ordinary” CAC quality coins but they do alert you to the market’s fervor for outstanding ones. CAC pieces generally fetch premiums up to about 25% - where skillful eyes will bag good deals.” CDN are the initials of the Coin Dealer newsletter.
This paragraph is important. I caution you and will tell you that CAC is not a gimmick. Prices realized at auctions and on the bourse floor at shows will attest to the premiums they can garner. So don’t let pride get in the way of good judgement. If you submitted coins to CAC and the pass rate was very low, find out why.
Partner and owner of Rare Coins of New Hampshire, Inc. since June, 1990 and a full time coin dealer since 1979. Warren is a full member of the Professional Numismatists Guild and a life member of the American Numismatic Association. He was selected by the Rosen Numismatic Advisory as one of the ten leading numismatists in the country for twelve consecutive years. He was selected by PCGS and written up in their newsletter as handling and submitting some of the nicest coins they have ever seen.
1. What is the official name of the dime minted from 1916-1942?
2. Does the government print paper money at the Philadelphia Mint?
3. What is the design of the first dollar coin to circulate in the United States?
By Joseph Presti
Warren recently handed me a group of coins to submit to PCGS for grading. One of the coins was a choice uncirculated 1919 Buffalo nickel. Being a coin nerd, I always look at the coins going in for grading to see if there may be anything that Warren has missed, better two sets of eyes than one. As I examined the nickel, I noticed that the digits of the date had some doubling, nothing dramatic, but it was there. Initially, I thought it might be machine doubling, so I opened my trusty Cherrypickers’ Guide and there it was, a new listing for a 1919 doubled die obverse nickel. Some of you may recall that recently there was a rather dramatic 1919 doubled die obverse dime discovered, but the nickel was not nearly as doubled as the dime. So my feeling was that the nickel was probably a minor variety.
Off to PCGS my submission went. I decided to send the coin as part of an economy package since Cherrypickers’ valued the coin at $350 in MS-63. I checked off variety attribution and paid my $18 for the added service and took a chance. Two months later, the submission comes back and PCGS agreed with me and graded the coin MS-64 with the doubled die attribution.
Next step, off to CAC the coin goes and John felt it was solid for the grade and put a sticker on it. So now we have a 1919 doubled die nickel in PCGS MS-64 CAC, but what do we do with it?
I do a little research and discover that it is the first of its kind graded by either PCGS or NGC. Next question Warren and I contemplated was do we retail it or auction it? The question we then have to ask is if we decide to retail the coin how do we price it? That turned out to be an incredibly difficult question because it was the first and only 1919 doubled die nickel. Some of the sources we checked with could not venture a guess and our fear is that the coin could be esoteric or what happens if we retail it and in a few years the grading services decide that they will not recognize the variety anymore, like they recently did with the 1914/3 nickel. In the end, we decided to put the coin in auction and take our chances.
Off to Heritage the coin went and it is put into the Long Beach internet session of their sale with the following description;
1919 5C Doubled Die Obverse, FS-101, MS64 PCGS. CAC
When I saw the description I was not very happy and I called Heritage and complained. I thought the coin should have been placed in the signature portion of the sale or at the very least, been given a description worthy of its’ apparent rarity being the only one graded. My pleas fell on deaf ears and no changes were made to either sale placement or description. As internet bidding opened, I monitored the bids and it quickly rose to $900, an amazing price, we thought. A day before the sale the internet bids sat at $4600, Warren and I were dumbfounded.
It is Sunday night, the weekend of the sale and I am wasting time on my laptop, watching TV. I logged onto Heritage to check how our auction lots sold. I take a look and have to refresh the page because I thought there was a mistake. The nickel sold for $11,000 plus the buyers fee, making the total almost $13,000! I call Warren at home and tell him what the coin sold for, there was silence on the phone, I think he thought I misspoke. We are both so confused as to why this coin sold for so much other than to think that it was the first and only coin graded to date.
We have seen it so many times, especially in the early days of the grading service, pop one coins selling for ridiculous prices only to come down later as more get graded. I just hope this coin turns out to be truly rare and that the Buffalo nickel community appreciates it for a long time.
By Dave Carleton
We have featured our inventory in Coin World twice over the last two months and have had not only the opportunity to place some nice coins with new collectors, but to also get fresh opinions about their experiences in today’s market. One of the most common comments is the inability to find original material to complete albums and “Type” sets.
Another subject that I’m hearing a lot more these days is that many of these people are being inundated with unsolicited mailings offering myriad hard asset products. The subject comes up all the time as to whether we sell our mailing list or not (which we don’t), and I suspect that the reason these folks are receiving these offers is because they have done business with a company that sold their contact information. I have a feeling that this is just the beginning of this onslaught as more and more companies beat the drum about gold ownership. I also believe that everyone should have some gold in an amount relative proportionally to their total investment portfolio, let’s say around 10%, but that would obviously vary depending on how much faith one has in paper assets.
I also strongly believe that numismatic coins should have a place in the hard asset tier of your portfolio, too (they’re not making them anymore). Many people have voiced their concern about using bullion coins for goods and services in case of an emergency and have asked what I would recommend. The resurgence of these questions reminds me of 1999, when we were approaching the new millennium year of 2000 and the fear of Y2K. My answer is the same as it was then, and that was,” If you think you’re going to need something other than paper to pay for goods and services, then I would recommend smaller denomination gold coins like the 1/10th oz gold American Eagles.“ Back in 1999 we were selling them for $35.00 and today we’re selling them for $145.00 based on spot of $1,315 right now. That’s about a 10% premium over melt, but I think it’ll be worth it if you ever have to use them for reasons aforementioned.
This brings me back to all these unsolicited offerings. One of my customers got a piece cautioning him to “Avoid Costly Rookie Mistakes” and then they offered him a “deal” on $2.00 Australian Kangaroos for $64.99. These are ½ gram coins and there are 31 grams in a Troy ounce so there are 62 of these Kangaroos in an ounce times $64.99 equals $4,029. Unless you have a thing for kangaroos, I think that as much as I like small denomination gold, this is a rookie mistake. A 300% premium over the spot price of gold is totally unacceptable to me, especially if one intends to use them for barter or for anything for that matter. As you search the internet for information about gold, silver and hard assets, rest assured that future sidebar ads offering gold and silver will litter your computer for months. So do the math and try to avoid those “Rookie Mistakes.” Actually the best way to do that is to just call us.
David Carleton, a New Hampshire native was introduced to coin collecting by his father and Grandfather in the 50’s. Gold bullion speculation dominated the 70’s culminating in 1980 when focus on Numismatics returned. He became a life member of the ANA , met Warren Mills (his coin Guru) and they cofounded RCNH in 1990.
Two Silver Dollars, John Muir’s Countenance
And My Mount Whitney Attempt
By Paul V. Battaglia
The Owens Valley is approximately 75 miles long and rather U-shaped. The massive, eastern rampart of the Sierra Nevada range is to the west (one’s left when facing north) while the White and Inyo Mountain ranges are to the east. Interstate 395 runs down the middle and is the lifeline to all the fascinating and richly historical towns along the way. This beautiful highway stretches from the border of British Columbia all the way down to the outskirts of Los Angeles. Merely driving from one end to the other brings the traveler through more than several growing zones as in Death Valley to mountainous terrain or vice-versa.
Now, this column is supposed to focus on coins, exonumia, paper money and closely related subjects. You will be wondering about the “two silver dollars” that I mentioned in my title. I am neither a good will ambassador or tour guide for this area, though my wife & I have been visiting it for about five years straight. The two silver dollars come into the picture after my attempt to ascend Mount Whitney. I had been pondering what to offer for this month’s column for weeks. A writer wants to intrigue his readers, capture their attention, provide them with some education, a laugh, a point, ask their position on his subject, etc. My sixty-fifth birthday came to pass on 2nd September, which also marked my fiftieth year in rare coins “business wise”* and fifty-eight years total since I first held a coin with a collector’s mindset. You would think I could relate dozens of tales offhand, but I confess this is not to be. Most would come out dry, slightly pompous, meandering, peculiar or, seemingly, without much of a satisfying finish.
To make a long story short, I had been working out at a professional gymnasium for many months in preparation for my attempt to ascend the highest peak in the lower 48 states. My progress had been nothing short of sterling, but gold was needed in the end. I acclimatized for several days and nights prior to my ascent and felt marvelous. My partner came in from Cincinnati, OH, and turned out to be a swell, true-blue, stand-up guy of impeccable character and experience. We started out at 1:11 AM on 7th September with full, useful packs that carried only what would be needed to sustain life….no waste or super cargo tolerated! Not when you are gaining 6000+ feet in eleven miles over mostly granite and scree! (Remember, you also have to come down, too….eleven additional miles.) I caught a touch of AMS or Altitude Mountain Sickness at 12,000 feet. My stamina was great and I was in fine form, but AMS has the final word. We packed it in after a rest and headed back down as AMS is nothing to fool with, ever. This malady can strike anyone, anytime for any reason and one had best heed the warning. We still had a grand time and took many pictures in that wilderness.
Fast forward to a day later after we both hit the hay and slept like babes-in-arms that night. My partner, Chris, headed back down I-395 South to LAX….I was driving back north on I-395, carefree and filled with elation. I pulled over for a bite to eat at one of the many small, family-run eateries that take immense pride in their cleanliness and large portions to the public. A fair size roadside flea market was nearby with everything from A to Z. I love poring through “stuffe” as I refer to it and will get down and dirty hoping to locate something of use. A box with a mish-mash of stuffe was off to one side with a sign stating “$4 for any single item.” I found a weird gold coloured/plated belt buckle of an unknown maker with two U.S. Morgan Silver Dollars within….GENUINE silver dollars I might add. Plus, they were original as evidenced by their dark patina! I held it up to the owners and nearly placed it in their hands out of fairness and courtesy given the obvious error in pricing. The man waved it off from further viewing….he just wanted the payment, ok. The silver dollars were set up with the obverse of one and the reverse of the other showing. This would provide the ever-changing viewers with a look at what constituted the Morgan Silver Dollar design as the proud wearer strutted his stuff past them. Well, I must say that my heart raced when I saw the obverse dated one as being an 1879. Carson City was nearby and it was vaguely possible that the reverse might sport that coveted “CC” mintmark. The other coin was a Philly, as the reverse only was showing, but there are plenty of rare ones from that mint, too. Alas, no such luck when I released them from their screw holds. No matter, these silver dollars are a fine piece of luck and shall always remind me of my trip. I also snapped up this neat John Muir medal for fifty cents despite it being marked $4.95. I did not need it nor was I seeking one, but given my proximity to Yosemite National Park and the Tioga Pass (about fifty miles to Lee Vining from where I stood), it seemed more than fitting to have this remembrance of a true conservationist. I continued my journey back up highway I-395 North and the trip’s end in Carson City. I drove into Reno next day and headed home into New Hampshire.
I wonder how that belt buckle came to end up where it did. Who was the owner prior to the folks from whom I purchased it? Did they not realize it held two genuine U.S. Morgan Dollars? Perhaps one of their children or a relative was entrusted with the examination and subsequent pricing. Ultimately, who was the initial owner? Someone did wear the buckle as it exhibits light wear on the high points excluding the worn silver dollars. The individual who placed those silver dollars within the buckle had definite knowledge to only use worn and common date pieces. The dollars had been residing in that buckle for a long time with such dark grey patina upon their respective obverse and reverse. I ask questions to which there are no answers. I seek the simplest of clues for it is through salient indicators that we often discover the answers to greater issues. When no answers are to be had, acceptance must and will suffice….especially with this find, this little gift that shall stay in my hands for a hitherto unknown span of time.
Click Here To See Enlarged Image
Click Here To See Enlarged Image
The granite spires surrounding Mount Whitney, the token remembrance of John Muir and two silver visitors from Philadelphia. We are all travelers at different speeds. Our self-imposed method of time determines our paths within Infinity.
*My first bit of rare coin business was when I was fifteen. I received a finder’s fee for locating a deal successfully purchased by that dealer, hence; I use that as my benchmark.
Paul Battaglia is the Senior Numismatist and a Life Member of the ANA. He travels with owner, Warren Mills, to the major coin shows across the country. Paul has 50+ years numismatic experience and has been with RCNH since 1990. He also cherishes reading, cooking, language, music, classic cars, lily/orchid culture, chess, economic statistics, differing viewpoints and FISHING.
Coins Changing In The Holders?
By Lou Roten
About 2 ½ years ago I bought some United States 1955 and 1956 proof sets on eBay. I discovered that a few of the 1956 sets unexpectedly had the type I Franklin. I looked for a local coin dealer to inquire about grading and found RCNH nearby. I was encouraged to have several of the 1956 proof Franklin type I halves and Washington quarters submitted to PCGS. RCNH did that for me and about 2 months later I got a call from David Carleton telling me that the Franklins returned: 1 PR-67, 2 PR-66 and 1 PR-65 – not bad. The quarters came back PR-68 cameo. Again, not bad. I did not pay Franklin type I prices.
Off these coins went into storage. Last week I took them out and noticed that a slight rusty looking spotting had developed on each of the coins around the perimeter of the surfaces, more on some than others. The rust color spotting is clear evidence that the coins were dipped for appearance to sell on eBay and for initial viewing once received. I should add that the coins were not in the original government packaging, but in Capital holders, another clue that they may have been dipped. The coins showed absolutely no evidence of dip residue when I first saw them and brought them into RCNH in April 2014. I knew nothing about dipping at the time.
Of course, eBay is a dangerous place and is often a dumping ground for problem coins as well as for coins that have that (often temporary) pristine fresh blast white look. If ever there was any doubt in my mind about the surface of coins continuing to react to a foreign substance while in TPG holders, I have none now, though the holders are not the problem.
When coins are dipped, they must be rinsed, neutralizing the acid in the dipping solution completely. But molecules are very small and any dipping solution residue is not visible after the coins are rinsed after being (almost) neutralized. Water used to rinse off all chemicals remaining on the coins needs to be distilled de-ionized water. Tap water can contain minerals, very fine suspended solids and dissolved gases that can cause more problems. The dipping is intended to remove a very thin layer of silver and copper sulfides, both of which are dark grey to black in appearance. The rusty red color on my coins is the light that is reflected back to us from the boundary layer at the surface of the silver when the oxide layer is very thin, a few nanometers (0.000025 mm)1. When the oxide layer is very thick, the coin will be various shades of dark grey and black, the color of the silver and copper oxides themselves, as no light can pass through that thick oxide layer to be reflected from a boundary layer beneath the oxide surface.
It seems clear to me that a small amount of the dipping solution had remained on my coins and has continued to react in the sonically sealed holder. An anaerobic condition does not mean safety for the coin; the pollution is on the coin’s surface and slowly continues to react with the silver. The holder will keep the damage to a minimum as the airborne source of sulfur (for the most part atmospheric H2S) has been eliminated.
I still have nice examples of the 1956 type I Franklins, however not as nice as they could be because of the unnatural spotting. It is a shame how much dipping of coins is done simply for the sake of a short term appearance. The natural patina and original flow lines of the coin are compromised.
I also had been buying what I thought were AU to UNC Morgan dollars for a few months before the Proof set purchase. It being pre-RCNH, I sent several of the Morgan dollars to be graded. I think I recall 6 or 7 of 10 came back details – cleaned. I thought they all looked pretty good at the time, of course, before my education here at RCNH. Most of those raw Morgan silver dollars are now showing the familiar rust color in the reeded edges – an area difficult to rinse completely. The coins once looked OK to me when I bought them, but now have no “life” when compared to the original coins I see here. Lesson learned.
- “Coin Chemistry, Including Preservation and Cleaning.”, Third Edition, 2012, Weimar W. White.
Lou Roten - current adjunct instructor - mathematics / physics, Franklin Pierce University; environmental scientist; fiddler; life-long interest in collecting coins and stamps with some interruptions; very interested in the evolution of the coin making process.
Questions From The Mail Bag
By Warren Mills
This month’s question was posed in different ways by a few of our clients. It specifically pertained to reviewing auction lots for our customers in conjunction with a major show. We are happy to offer, as a service to our clients, a review of any auction lots in which they are interested. We do it free of charge, too! All we ask is that if they have us bid for them, we will charge a nominal fee for bidding. Just the protection alone of preventing our customers from purchasing inferior coins for their collection should be worth it. Here is the gist of the questions.
I appreciate the fact that you look at auction lots for me. I just can’t figure out why you reject so many of the coins for me to bid on?
The answer is that you are asking a professional for help to assemble your set of a collection of top quality graded coins. We put our name on the line to do our best to try and select the top-end graded coins for your consideration. If we are asked to examine ten or twenty coins and we feel they are low-end for the grade, we do not want you to bid. We just examined a $40,000 lot for a customer and my recommendation was not to bid on it. I was not sure about the coin being a true business strike! To me, it was a proof.
Auctions are frequently a dumping ground of marginally graded material. Yes, there are great collections that come to the market and the coins are wonderful. However, the majority of auction coins are pieces that we feel are overly commercial or low-end for the grade, not to mention altered surface and problem coins.
Today, you may not care about the strength of the grade. If the hole in the collection is filled, that may be good enough. However, the time may come that you may want to have your coins examined for future sale or CACing or anything else that may lead to enhancing the value. If that day comes, we do not want to be responsible for a client holding marginal quality. I’m not saying that another numismatist may look at a coin and feel it is great and I may think it is marginal or vice versa. I’ve seen plenty of CAC coins that I feel did not deserve the sticker, and I’ve seen coins rejected by CAC that I thought were great. That’s the subjective element of grading.
The bottom line is that your collection will be nicer if you adopt strict grading standards to each coin that you buy. In addition, if we examine 10 coins in an auction and feel that two are ones on which it is not worth bidding, this is a high percentage for us. We are not interested in the money for bidding on coins; we are more interested in protecting our clients.
Thanks again and please keep those questions coming. We welcome your questions. So please send them to me directly or emailfor future newsletters, and if you prefer, I will answer them for you privately.
October Highlighted Coin
1776 Colonial PCGS XF-45 Currency, Pewter CAC - $52,000
Click Here To See Enlarged Image
Click Here To See Enlarged Image
These coins were issued in copper, brass, silver and pewter, with the latter being the most collectable. The coin features a radiant sun shining on a sundial with the phrase “Mind Your Business” underneath, a popular theme at the time. The reverse has 13 circles with the name of each colony surrounding an inner circle spelling out “American Congress” with “We Are One” in the central circle.
This particular coin is a lightly circulated example exhibiting an above average strike, not showing the typical weakness evident on some examples. Being made of pewter one would expect some pitting of the metal, especially for something almost 250 years old, but this coin is very clean and does not show any pitting.
This historic piece is graded PCGS XF-45 with claims to AU and comes with a CAC sticker, priced reasonably at $52,000.
Coin Trivia Answers
1. The Winged Liberty Head, better known as the Mercury dime.
2. No, it is printed at the Treasury department in Washington, D.C.
3. It was actually the Spanish Milled Dollar, commonly called the Pillar Dollar and was legal tender until 1857.