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A Look Back at the History of Grading
slabbed franklin coinBy Arlyn G. Sieber
February 22, 2010
slabbed franklin coin



In September 1888, Dr. George Heath, a physician in Monroe, Mich., published a four-page pamphlet titled The American Numismatist. Publication of subsequent issues led to the founding of the American Numismatic Association, and The Numismatist, as it’s known today, is the association’s official journal. Heath’s first issues were largely devoted to selling world coins from his collection. There were no formal grades listed with the coins and their prices, but the following statement by Heath indicates that condition was a consideration for early collectors:

“The coins are in above average condition,” Heath wrote, “and so confident am I that they will give satisfaction, that I agree to refund the money in any unsatisfactory sales on the return of the coins.”

As coin collecting became more popular and The Numismatist started accepting paid advertising from others, grading became more formal. The February 1892 issue listed seven “classes” for the condition of coins (from worst to best): mutilated, poor, fair, good, fine, uncirculated, and proof. Through the years, the hobby has struggled with developing a grading system that would be accepted by all and could apply to all coins. The hobby’s growth was accompanied by a desire for more grades, or classifications, to more precisely define a coin’s condition. The desire for more precision, however, was at odds with the basic concept of grading: to provide a concise method for classifying a coin’s condition.

For example, even the conservatively few classifications of 1892 included fudge factors.

“To give flexibility to this classification,” The Numismatist said, “such modification of fine, good and fair, as ‘extremely,’ ‘very,’ ‘almost,’ etc., are used to express slight variations from the general condition.”

The debate over grading continued for decades in The Numismatist. A number of articles and letters prodded the ANA to write grading guidelines and endorse them as the association’s official standards. Some submitted specific suggestions for terminology and accompanying standards for each grade. But grading remained a process of “instinct” gained through years of collecting or dealing experience.

A formal grading guide in book form finally appeared in 1958, but it was the work of two individuals rather than the ANA, A Guide to the Grading of United States Coins by Martin R. Brown and John W. Dunn was a break-through in the great grading debate. Now collectors had a reference that gave them specific guidelines for specific coins and could be studied and restudied at home.

The first editions of Brown and Dunn carried text only, no illustrations. For the fourth edition, in 1964, publication was assumed by Whitman Publishing Co. of Racine, Wis., and line drawings were added to illustrate the text.

The fourth edition listed six principal categories for circulated coins (from worst to best): good, very good, fine, very fine, extremely fine, and about uncirculated. But again, the desire for more precise categories were evidenced. In the book’s introduction, Brown and Dunn wrote, “Dealers will sometimes advertise coins that are graded G-VG, VG-F, F-VF, VF-XF. Or the description may be ABT. G. or VG plus, etc. This means that the coin in question more than meets minimum standards for the lower grade but is not quite good enough for the higher grade.”

When the fifth edition appeared, in 1969, the “New B & D Grading System” was introduced. The six principal categories for circulated coins were still intact, but variances within those categories were now designated by up to four letters: “A,” “B,” “C” or “D.” For example, an EF-A coin was “almost about uncirculated.” An EF-B was “normal extra fine” within the B & D standards. EF-C had a “normal extra fine” obverse, but the reverse was “obviously not as nice as obverse due to poor strike or excessive wear.” EF-D had a “normal extra fine” reverse but a problem obverse.

But that wasn’t the end. Brown and Dunn further listed 29 problem points that could appear on a coin – from No. 1 for an “edge bump” to No. 29 for “attempted re-engraving outside of the Mint.” The number could be followed by the letter “O” or “R” to designate whether the problem appeared on the obverse or reverse and a Roman numeral corresponding to a clock face to designate where the problem appears on the obverse or reverse. For example, a coin described as “VG-B-9-O-X” would grade “VG-B”; the “9” designated a “single rim nick”; the “O” indicated the nick was on the obverse; and the “X” indicated it appeared at the 10 o’clock position, or upper left, of the obverse.

The author’s goal was noble – to create the perfect grading system. They again, however, fell victim to the age-old grading-system problem: Precision comes at the expense of brevity. Dealer Kurt Krueger wrote in the January 1976 issue of The Numismatist, “Under the new B & D system, the numismatist must contend with a minimum of 43,152 different grading combinations! Accuracy is apparent, but simplicity has been lost.” As a result, the “New B & D Grading System” never caught on in the marketplace.

The 1970s saw two important grading guides make their debut. The first was Photograde by James F. Ruddy. As the title implies, Ruddy uses photographs instead of line drawings to show how coins look in the various circulated grades. Simplicity is also a virtue of Ruddy’s book. Only seven circulated grades are listed (about good, good, very good, fine, very fine, extremely fine, and about uncirculated), and the designations stop there.

In 1977 the longtime call for the ANA to issue grading standards was met with the release of The Official A.N.A. Grading Standards for United States Coins. Like Brown and Dunn, the first edition of the ANA grading guide used line drawings to illustrate coins in various states of wear. But instead of using adjectival descriptions, the ANA guide adopted a numerical system for designating grades.

The numerical designations were based on a system used by Dr. William H. Sheldon in his book Early American Cents, first published in 1949. He used a scale of 1 to 70 to designate the grades of large cents.

“On this scale,” Sheldon wrote, “1 means that the coin is identifiable and not mutilated – no more than that. A 70-coin is one in flawless Mint State, exactly as it left the dies, with perfect mint color and without a blemish or nick.” (Sheldon’s scale also had its pragmatic side. At the time, a No. 2 large cent was worth about twice a No. 1 coin; a No. 4 was worth about twice a No. 2, and so on up the scale.)

With the first edition of its grading guide, the ANA adopted the 70-point scale for grading all U.S. coins. It designated 10 categories of circulated grades: AG-3, G-4, VG-8, F-12, VF-20, VF-30, EF-40, EF-45, AU-50, and AU-55. The third edition, released in 1987, replaced the line drawings with photographs, and another circulated grade was added: AU-58. A fourth edition was released in 1991.



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More Resources:

• Subscribe to our Coin Price Guide, buy Coin BooksCoin Folders and join the NumisMaster VIP Program

2010 U.S. Coin Digest, The Complete Guide to Current Market Values, 8th ed.

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Standard Guide to Small-Size U.S. Paper Money, 1928 to Date

Strike It Rich with Pocket Change, 2nd Edition

 

 



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