Dr. Sol Taylor

Coin Population Data, Part 1

By Dr. Sol Taylor
"Making Cents"
Saturday, January 17, 2009

or many years, the population of certain rare coins was well known to the serious numismatist and coin dealer.
    Such well known rarities as the 1792 dime (3 known), the 1804 silver dollar (15 known) the 1913 Liberty head nickel (5 known), 1870-S $3 gold piece (1 known), are but a few of the rarities in the catalogue of American coinage.
    Since 1985, shortly after the Professional Coin Grading Service (PCGS) started encapsulating coins and grading them, monthly reports on the population of all such graded coins was published. Shortly thereafter, the rival grading service Numismatic Guaranty Corp. (NGC) followed with its own population reports.
    These two services grade a large percentage of all coins now in the marketplace and in major collections. 
    At first, only very scarce and rare coins were in these reports. But as grading became a vital pricing element, literally millions of coins (more than 10 million as of 2008) have been submitted for encapsulation.
    Further, the original grading scale effectively limited the highest possible grade as Mint State-65 on a scale of 1-70, also known as the Sheldon scale.
    Many of the earliest graded coins that received a grade of MS-65 were reevaluated by the early 1990s. Some were obviously somewhat better than others, so the grading services, along with the American Numismatic Association (which founded the graded scale and guidelines), started defining higher grades all the way up to MS-70 and for proof coins (PR-70).
    When I published my 4th Edition of the Standard Guide to the Lincoln Cent in 1999, my book contained population data for each Lincoln cent in the series and for every grade, a few coins rated MS65 ratings (including the important color marker of "Red" versus the lesser valued "Red Brown" and least valued "Brown." The columns above MS-65 were empty except for the most modern issues after 1959.
    Since then, every column over MS-65 has various numbers ranging from a single digit to many dozens.
    For example, in 1999, only a single 1926-S cent rated an MS-65RD standing and was sold at auction for about $35,000. Today there are no fewer than 23 so-called MS-65RD 1926-S cents.
    According to Q. David Bowers in his 2008 book on Lincoln Cents, the sudden upswing in this rarity can be traced to a process commonly known as "doctoring," where a coin with a grading of red-brown can be chemically altered to appear red.
    In fact, regarding this particular issue, Bowers cites a dealer who handled a few MS-65 red-brown specimens and soon thereafter, some managed to rise to MS-65RD status. The dealer took careful notes of minor details of the red-brown coins, and according to Bowers, these same coins were doctored to make the superior red grade.
    The difference between an MS-64RB 1926-S cent, which trends about $1,500, and a MS-65RD cent is about $35,000 — or more.
    Another dealer is quoted as saying he has never seen a "real" 1926-S cent grading MS-65RD. This happened to an especially poorly made coin which had various minting and material problems, and probably few or maybe even none left the San Francisco Mint in superior MS-65RD condition.
    This is equally true of several other dates in the 1920s, where newly minted coins lacked full details and lacked fresh mint red color from the start.
    Yet, as Bowers points out, almost all population data tends to get larger with time.
    In the early 1990s, a dealer had obtained 1909-VDB cent (a very common coin in mint condition) which was graded by PCGS as MS-67RD. At the time, it was the only one graded that high. It sold to a collector as "the only one" for some $3,500. Today the same graded coin would bring one-tenth as much at auction, since dozens more have achieved this lofty status.
    In 1996 at the American Numismatic Association convention, I bought a spectacular 1943-S cent (the wartime steel cent) with a grade of MS-67. At the time, there were fewer than a dozen graded that high, and I paid $100. Today the same graded coin can be found for $20 or even less, as hundreds more have been so graded.
    Because there is a fee of no less than $10 to pay for each coin submitted to PCGS or NGC (and several other grading services), one can expect only coins valued well above $10 to be submitted for encapsulation. Thus the population data for a very common coin such as a 1955-S cent would show single digits in the lower ranges below uncirculated, since such coins are worth only 10 to 20 cents each.
    Even MS-65RD coins are worth perhaps as much as 75 cents. Thus, unless one expects to have his 1955-S cents achieve lofty ratings of MS-67, MS-68 or even MS-69, there is no incentive to submit them for grading. Yet, hundreds of 1955-S cents have been submitted and graded, and indeed some have achieved these stratospheric numbers.
    That does not mean any of them is particularly scarce or rare, as there are no doubt tens of thousands of uncirculated 1955-S cents that can be submitted in the hopes of winning the grading lottery.
    This is true of almost every coin issued since the 1940s. In fact, it is generally reported that in 1955, the late Robert Friedberg, a New York City coin dealer, had bought and stored away some seven million newly minted 1955-S cents. The hoard has been dispersed.

    Part 2 will address the origins of grading services and the impact of Set Registry on collecting and coin pricing.