Today's Coin Grading: Beauty in the Eyes of Experts
by John Devitt
In ages past, a numismatic coin's condition was a rather vague and subjective matter. When serious coin collecting emerged about the 14th century in Europe, it was tied to the Renaissance's rediscovery of classical Greek and Roman culture. The first big collectors such as the Italian poet Petrarch were interested in ancient coins as artifacts akin to the Grecian urns and Roman art that were turning up. For centuries, rare and expensive ancient coins were the heart of European numismatics (known as "the Hobby of Kings" as well as "the King of Hobbies") and a coin's relative beauty was strictly in the eye of the beholder (buyer and seller). In fact, even numismatic books of the 17th and 18th centuries seldom addressed the condition of coins. As the hobby grew in the 19th century, some general terms of a coin's condition began to be used as a gauge of value: Very Fine, Extremely (or Extra) Fine and Uncirculated. But it remained very much a subjective matter of eye-appeal.
Dr. Sheldon's Revolutionary Grading System
It was not until 1948 that the American Dr. William H. Sheldon, an ardent collector of early cents, introduced a complex grading system that would take hold in the collecting world. His precise method of assessing individual U.S. coins' condition (or grade) worked on a scale of 1-70. A Poor-1 described an almost totally worn coin whose origin could still be determined. A non-plus-ultra MS-70 grade was reserved for a precious few mint-state specimens that met almost impossibly high standards of perfection and luster. In practice in the coin trade, however, grades were generally limited to Fair (F-2), Good (G-4), Very Good (VG-8), Fine (F-12), Very Fine (VF-20), Extremely Fine (XF-40), About Uncirculated (AU-50), Average Mint-State (MS-60), Choice Mint-State (MS-63) and Gem Mint-State (MS-65). Occasionally, there might be refinements on the scale for costly rarities. Sheldon's descriptions for his grades are still followed today as a general guide for grading.
But professional graders also follow very specific guidelines for particular coin types. For example, A Guide Book for United States Coins gives these very precise criteria for VF-20 Morgan silver dollars: "Two-thirds of hair lines from top of forehead to ear visible. Ear well defined. Feathers on eagle's breast worn." The step-up to XF-40 grading requires, "All hair lines strong and ear bold. Eagle's feathers all plain but with slight wear on breast and top edges of wings." That doesn't leave much room for argument.
Argument-Breaking Consensus Coin Grading
Circulated coin grading is fairly clear-cut, as the examples above show. Disagreement about grading has been more frequent in higher mint-state rankings, where a great value gap may exist between MS-63 and MS-65. One professional grader's eye might differ from another's at least some of the time in these categories. A solution developed in the mid-1980's when consensus coin grading (by a panel of three experts) was introduced and generally accepted in the U.S. coin world as a means of settling grades for more expensive coins. The Professional Coin Grading Service (PCGS) and Numismatic Guaranty Corporation (NGC) have remained the leading practitioners of consensus coin grading. The coins are sealed in protective transparent plastic cases with the consensus grade certifications, which today even include refinements in every step from MS-61 to MS-70. Grading has come a long way over the past generation to assure the buyer of expensive coins as objective and accurate appraisals of condition as possible.
Could coin grading become even more refined and "infallible" in the future? There is talk among experts today of possible computerized grading down the road, which would match digital images of chiefly rare coins' accepted grades with those being assessed. With some practice, coin collectors develop their own sharp eyes regarding grades and learn to trust the assessments of one coin dealer over another. Very popular books that are valuable in developing a grading eye are The Official American Numismatic Association Grading Standards for United States Coins and Photograde. As in anything else, practice makes perfect and an experienced eye makes coin collecting all the more fun.