Expertising Stamps

At this point the market for 1930-1950 graded stamps has pretty much collapsed for a few years now, I've seen plenty of them thrown into large lots. A few of the earliest issues might still attract some attention, but most of them are just dead weight plastic.

howell1018 wrote: expertizing and grading go hand in hand......." As an example, I have a certificate of authenticity for Portuguese India #1. Why on earth would I want to get that graded? Another example: I have a nicely centered, used, copy of Mexico C61. I have reviewed it closely and consider it genuine. Again, who cares about its "grade?" Maybe if I had a perfectly centered, used, copy of USA #245, I might want a grading. Note that I said "might." I collect stamps, not grading.

revenuecollector wrote: "....the majority of the stamp marketplace has not embraced numerical grading at all....." And thankfully so.

I've always suspected that the true reason for developing grading was to support the business of selling stamps as investments, possibly as a long-term play. That is, if you're going to float an offering of an investment vehicle that is backed by allegedly valuable stamps, you need some way to endorse or objectively characterize the asset value of the stamps. If you can tell your investors that they are buying into a portfolio that only includes stamps that are PSE graded 90 or above, perhaps confidence increases, and it removes the logistical complexity and time burden that would be involved if each well-heeled investor insisted on inspecting every stamp in the basket and forming a personal opinion as to condition, quality or value. Grading then becomes like Standard & Poors' ratings for debt, an allegedly independent, objective benchmark against which the risk profile of the investment vehicle can be measured. Further, the need of the investment houses to have all their stamps graded would drive the business of the grading agencies like PSE. Dealers selling graded stamps alongside investment vehicles also would realize higher prices and so all boats, PSE, dealers and the investment offering entity, would rise with the tide. Of course, if the stamps don't appreciate and the investors lose their shirts, then they will address it the old-fashioned way, civil litigation; they'll sue PSE right along with the party that touted the investment vehicle, just as investors and the government did with S&P after 2008. Even with individual stamp buyers, eventually there will be a transaction large enough, and a loss high enough, that the buyer or his/her heirs will contend that the loss stemmed in part from deceptive grading by the grading firm, and a lawsuit will result. I wouldn't want to be PSE operating within the US litigation environment.

cjjpalermo described my perception of grading perfectly. I don't, however, agree with the idea that PSE would be held responsible for a loss in value. PSE doesn't guarantee investment worthiness, as does S & P, they only provide a description of the investment vehicle. If they were grading stamps as 90+ that turned out to be flawed then maybe an argument could be made. I also believe that grading is valuable at a much smaller level. I myself admit that I cannot count on my ability to grade, and to a much greater degree, insure that a stamp is sound and unfettered. The expertization is reassurance to me, and I assume, to the next owner of my stamp. I'm unfamiliar with the "Portuguese India #1," but if it is a valuable stamp in excess of say ....$500 then I would want it graded to ease the eventual sale to a potential buyer who, unless an expert in the area would want to know that an outside party had conferred an acceptable grade. Now if it's a $2 stamp, yes I wouldn't care.

I have no stock in PSE.