Can someone tell me why slabbing make sense?

Currently, here's my take on slabbing

Quoting Mr. James Taylor of ICG in his recent post on the ccgtcc.com message board…

"Notice I said we are offering a consumer protection service. ICG will not "change" any chip. "

What consumer protection? These disclaimer's are taken directly from their website at:

http://www.icgcoin.com/terms.htm

8. The grading of coins is an exercise of professional judgment and opinion, which can be subjective and may change from time to time. As a result, ICG shall assume no liability of any kind whatsoever and makes no warranties or representations to Customer for any grade assigned by ICG to any coins.

10. Except as expressly set forth herein, ICG disclaims any and all warranties, express or implied, regarding ICG's grading service and all activities of ICG related thereto.

In another paragraph Mr. Taylor writes…

"Also please notice we are not being arrogant and saying, "You should collect slabs!", instead we are simply offering a consumer protection service to those who wish to use it."

I ask what protection?

They already have a disclaimer as noted above. Let's say you are a dealer and send in a very old chip and even you are not positive of the catalogue number as there are three varieties of this chip. Let's say ICG grades it and catalogues it but the catalogue number is incorrect (human error, grader error) and puts a catalogue number on it as the high-end chip worth $1000. The 2nd variety was worth about $200 and the third variety $50.

You sell the slabbed chip for $800 to a fairly new collector and he keeps it for several years then offers to sell it to another collector who is not so sure of it's catalogue number so the buyer takes it to a another well known collector dealer who believes it to be in reality the 3rd variety.

Who has liability in this issue? ICG will probably refer you to their disclaimers or may no longer be in the business of slabbing - excuse me grading chips anymore or may have gone out of business who knows what the future brings.

Next the chip is shown to several dealer/collector experts in the hobby and they all agree it is the 3rd variety. What now happens to the collector who relied on ICG's third-party expertise and purchased the chip from the dealer for $800?

Mr. Taylor states that the chips can be cracked out of their holder. I know this is done with coins, but coins being made of metals are not as fragile as chips. I've never cracked open a slab but I wonder how easy it is? Could it be done without damaging a chip?

Another problem is that ICG has refused thus far to publicly disclose who their third-party chip graders are. For all we know, it could be their normal coin graders. For all we know, it could be an unscrupulous collector or dealer who plans on grading their own chips at higher grades.

Are there really as many grades to a chip as ICG has on the grading list? I doubt it.

Mr. Taylor makes a very strange statement, at least in my mind.

" The chips do not melt into the slab. Anyone is free to crack them out of our holders. The chips themselves are the only thing anyone will ever be buying or selling. We would never recommend someone buying a chip they are not educated enough to purchase. If someone relies solely on crutches of "dealer trust" and/or crutches of "grading service trust", they will end up with some bad purchases because of there own lack of education."

He says the buyer should be educated before purchasing, yet touts his service as a consumer protection? He further states that if they purchase on the "crutches" of a "grading service trust" they will end up with some bad purchases. I keep seeing that this is exactly what some people who want to use the grading services want is to have the "grading services" as the sole end all in what grade their chip is… and with putting catalogue numbers on them the sole end all "exactly" what chip variety it is.

"DEALER TRUST!!! I love this one especially if I am working with a Dealer who is also a club member. At least we have the club Code of Ethics and a club liaison member to arbitrate our problems.

I ask what then does a "consumer" expect to be getting from the purchase of a slabbed chip over the exact same one that is not slabbed?

"EDUCATED BUYER!!!" Isn't this what our club is all about? And I think most of us can agree that we don't need a chip in a slab telling us "this is what this chip IS".

What does a slab have to offer for my chips and tokens?

Is it a grade that is accurate?

Is it a catalogue number (which they did not get permission from the author to use?) that is accurate?

Is it the protective holder?

My concern on using catalogue numbers on a slab is that I feel if the company is using someone else's creative works, they are implying those authors have endorsed such works or have authenticated the slabbed item is indeed the exact item as catalogued.

I just don't see where slabbing has a place in this hobby.

The only reason for the slabbing companies to enter into our realm is to make money off the people, who they can, convenience that slabbing is the best way to protect a chip, GRADING and CATALOGUING aside.

Now here is my disclaimer…

If someone wants a chip/token in a hermetically sealed coffin, I don't care. It's their right to purchase whatever they want or to do whatever they want with their chips and tokens.

It is also my choice to proclaim…

I will NOT buy any slabbed chip or token.

I will NOT have any slabbed chip or token in my collection.

I will NOT buy ANY chip or token from any dealer who sells slabbed chips or tokens.

I will NOT buy ANY chip or token from any dealer who grades chips or tokens for a slabbing service.