5th National Silver Dollar Convention
St. Louis, Missouri
November 8 – 11, 1984
MS Grading System: Type Coins and Silver Dollars
By John W. Highfill
This article has a primary purpose of trying to educate, philosophize, and/or define the complex nature of the mint state (MS) grading system. To somewhat limit the complexity of this discussion, I will speak toward silver dollars only.
The majority of the difficulties in today’s grading of coins comes from the MS coins. Practically all collectors, either novice of advanced, have some degree of knowledge in grading circulated coins. There are very explicit books with photographs that are available to help determine the grades of G-4 thru AU-55. Two such books are Photograde by Brown and Dunn, and the ANA’s (American Numismatic Association) Official Grading Guide. There are many other commercial books which have been written within the past five to ten years; this being the time frame that inflation has paved the way for investors to enter the marketplace in a very serious manner. Many of these investors were collectors at one time; therefore, they have minute problems in the area of grading. However, those prudent investors that are very serious-minded are careful to protect themselves with expert and knowledgeable dealers or ANACS papers. The numismatic industry has shifted from the collector-oriented base to those more investment-minded. Therefore, when the money is on the line, the grading had better be accurate!
Now that we have the basics behind us, we will proceed to mint state grading. There are extreme price differences between the MS-60, MS-63, and MS-65. Especially between the MS-63 and the MS-65 grades in the Morgan and Peace silver dollar series. There are a few auction companies that have recently begun to install and implement the MS-64 grade in their respective auctions. One author has gone to print advertising the price projections for MS-60, MS-63, MS-65 and the MS-64 grade.
We hear the argument, that if you start grading a coin MS-60, MS-63, MS-64, MS-65 and MS-67, then what about MS-61, 62, 66, 68, 69? At some point, we have to get serious about the value versus the grade of a coin. I believe that most knowledgeable and professional dealers agree that there are different grades of uncirculated coins. Thus, we have a base for MS-60, MS-65, and MS-67.
When the MS-63 was first introduced in a 1982 C.D.N. there was a lot of controversy at that time. We all agreed that there was a lot of silver dollars that are better than MS-60 and not good enough for MS-65. Thus, the birth and installation of the MS-63 grade. We are at the same crossroads once again. Enter the argument for the MS-64 grade. There are many silver dollars that are better than MS-63 and not good enough to be classified as MS-65s. With this philosophy in mind, an MS-64 grade would likely be “a good candidate for grading, and defining a value for investment grade silver dollars that are not as good as an MS-65 and better than roll quality MS-63 silver dollars.” Currently, they are referred to as MS-63+ dollars.
Now we will enter into another argument. Currently, we have low inflationary times and moderately stable market conditions. A silver dollar under those conditions will have to be almost perfect to bring the historical high MS-65 prices. Those coins “not quite there” will not bring the MS-65 grade. Now comes the main idea of this entire series of events. Are we paying MS-65 prices for MS-67 coins? Many dollar experts believe that to be the case. If so, are the “not quite there” coins really MS-65s and the so-called near perfect coins MS-67s? It seems to this writer that MS-60, MS-63, MS-65 and MS-67 are the categories that we should work within.
Instead of MS-64 being worth less than MS-65 and more than MS-63, we are really in essence saying that MS-64s are actually MS-65s and MS-65s are truly MS-67s. After all, if a coin is near perfect, it should be classified as an MS-69 or even MS-70 (God forbid!). It would be nice to be able to read columns that have price guides that are realistic in direct proportion to their value. An example is: 1884-O Morgan Dollar MS-60 – $42, MS-63 – $55, MS-65 – $150, and MS-67 – $275. The MS-60 being the most common and sold frequently in roll form is valued at $42. The MS-63 would most likely be a nice BU coin with a minimum amount of bag marks and a good to above average strike. All mint state coins are just what they are stated “mint state.” They must all exhibit full mint luster. The MS-65 silver dollar should have a full strike, full mint luster and a very minimum of bagmarks that are strategically located and not at all unsightly. In other words, three or four small marks distributed in the high relief areas that go unnoticed are better than a dollar that has two or three small marks on the cheeks or in the immediate fields. The MS-67 silver dollar must have a full mint bloom, full complete strike and almost no visible marks. Last, but not least, MS-69 would almost resemble a branch mint proof. It would literally be flawless. MS-70 must be entirely perfect. Classifications of grades of “most” silver dollars are: MS-60 common, MS-63 common to scarce, MS-65 relatively scarce, MS-67 very scarce, MS-69 rare, and MS-70 virtually unknown. The above classifications are for most dates but are definitely not the entire dollar index. There are some dates and mints that are unknown in MS-65 and MS-67. These dates may not have ever been available from their respective mints in any grade above MS-65. Prooflikes are scarce to rare to unknown in some issues.
In summary, we will find that in today’s marketplace, we are dealing with more investors than collectors. With that in mind, the emphasis is on the storage of value coins, (mostly mint state coins), an absolute necessity. We are currently using the pricing guides for the categories of MS-60, MS-63, and MS-65. The MS-67 grade is not frequently published at present. This causes the MS-65 coins to be the highest price that is knowledgeable to the novice collector and/or investor. Therefore, the prices of MS-65 silver dollars are at their highest levels in history. Those dollars must be close to MS-67 quality in order to obtain those levels. If there were MS-67 price levels established, then MS-65 prices would reflect new levels. Then there would not be a need for MS-64 grades or MS-61, 62, 66, 68, etc. If this is attained and the quality matches the pricing, then your investment will be a sound one.
Good luck with your numismatic portfolios and remember that accurate grading is a must.