June 2010

NEW PARKS QUARTERS BEGINNING CIRCULATING

The first two coins in the latest U.S. circulating commemorative quarters program have been launched. The Hot Springs National Park quarter entered circulation in April, and the Yellowstone National Park quarter was officially released in early June. They're the first two new coins produced per the America's Beautiful National Parks Quarter Dollar Coin Act of 2008. This law requires the U.S. Mint to issue a series of 56 quarters honoring a national park or other significant site in each of the 50 states, the District of Columbia and five U.S. territories. The quarters will be issued at the rate of five coins per year in the order that the selected sites gained their national status.

The U.S. Mint has not yet announced when it will begin offering the three inch diameter versions of the new quarters called for in the authorizing legislation or what their prices will be. Since each of these coins will contain five ounces of silver and silver has been trading in the neighborhood of $18 per ounce for most of the year, we anticipate they'll be priced around $100 each. The Mint has previously reported difficulty striking the coins (partly because the legislation requires certain inscriptions on the edge) and has delayed introduction of the coins until those issues have been resolved.

We've received a number of requests for the new quarters, but because overall demand is so far significantly less than for the state and territorial quarters, we're ordering smaller quantities. Individual Hot Springs quarters are available on our web site now and will soon be joined by Yellowstone quarters. If you're interested in purchasing rolls of the new quarters, please contact us, as we plan to order only enough rolls to fill pre-orders of each issue. We do intend to offer the three inch diameter silver versions when available.

CONCLUDING THOUGHTS ON GRADING

In the previous three issues of our newsletter, we've looked at how coins and notes are graded to summarize their condition. As with other collectibles, availability is often more limited and demand greater as condition goes higher. Therefore, higher grade coins and paper money command higher prices. The price difference from one grade to the next higher grade is sometimes a factor of two or more. Independent grading services play an important role in the modern numismatic marketplace, but the collector who relies solely on their opinions may be at a huge disadvantage. We conclude this series of articles with some suggestions for improving grading skills.

Grading requires a good magnifier, a good light source, one or more references, and lots of practice. When grading, form an initial opinion without magnification. Move the coin or note around so that the surfaces are viewed at various angles to your light source, then examine it with your magnifier and form a final opinion. We recommend a 7x magnifier for coin and paper money grading, though some advanced collectors prefer lower magnification (e.g. 4x). At 7x magnification, you get a good look at the overall appearance of a coin, and any hairline scratches or other problems will be visible. Stronger magnification tends to exaggerate the significance of minor marks but is useful for authentication (when there is reason to suspect a coin may be counterfeit or altered) as well as variety attribution.

A regular lighting environment helps make one's coin and paper money evaluation more consistent. We recommend the collector have a workspace at home with a dedicated lamp for examining collectibles (this area can be shared with other activities, such as accessing the Internet). Of course, when you go to a coin shop or show, you'll have to use whatever light sources are available there. You'll see the same type of lamps with spring-loaded arms and clamped bases at many coin show tables. These lamps are sold at many office supply stores (about $15), and having one at home will provide a more consistent viewing experience. An incandescent or halogen bulb of 60-75 watts is best. Fluorescent lights are not recommended for examining coins and paper money.

Our discussion of how coins and notes are graded has necessarily been brief. A more rigorous treatment would fill a medium size book, in part because what to look for varies from one coin design to another. In fact, useful coin grading books have already been published. Some include photographs of coins from various series in multiple grades. Paper money grading is far less dependent on the design and can therefore be covered in a chapter or two in a broader paper money reference.

Grading proficiency comes with experience. In most cases persons hired by professional grading services have examined many thousands of coins over a number of years. A great exercise is to look at coins and notes graded by one of the major independent services with their grades hidden. Compare your grade to what the service has assigned. Small differences are to be expected (e.g. you may decide MS64 but the service said MS63), but if you think a coin grades MS65 and the service said AU50, you've got work to do! As you become confident in your grading skills, you can more reliably evaluate both "raw" and encapsulated coins you're considering for your collection, avoid those that may be overgraded, and cherrypick those that appear to be undergraded and may therefore be worth more than the asking price.

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