With little fanfare, the 1883-O eagle has become the coin du jour in the rare date gold market. This rare date, which for years was a cult item that was seemingly overlooked by all except for a small cadre of specialists, is suddenly a coin that is bringing big bucks. What’s behind the 83-O buzz? Let’s back up a bit and discuss some background about this issue. The 1883-O is the rarest New Orleans eagle with an original mintage of a ridiculously low 800. In my recent book on New Orleans gold, I estimate that there are three to four dozen known. This includes a single coin in Uncirculated (an NGC MS61 that I sold a few years ago) and perhaps a dozen that grade About Uncirculated.
For many years, the 1883-O eagle had sold for $10,000 to $15,000 in Extremely Fine grades when it was available. I do remember the Eliasberg coin (graded EF45 by PCGS) selling via private treaty around four years ago for $20,000 and saying at the time: “Man, that’s a lot of money for that coin!”
Things started to change for this date in the early part of 2009. The Heritage 2/09 coin, graded EF45 by PCGS, sold for an exceptional $29,388. I can remember right after the sale, a client of mine, who I had sold a lovely NGC AU58 example to a few years earlier for not much more money, said “Guess I got a good deal, no?”
Then came the Heritage 9/09: 1667 coin. It was graded NGC AU50 by NGC and, in my opinion, it wasn’t an especially nice piece for the grade. It sold for $43,125. After this lot hammered, I was really intrigued by the new levels and anxiously awaited the next auction appearance for the 1883-O eagle.
I didn’t have to wait long. The recently concluded 2010 FUN sale contained an example graded EF45 by PCGS. This coin was nice and original but (and this is a large but...) the obverse was covered with discoloration from impurities in the planchet. This was a coin that not everyone was going to like and I wondered if we’d see prices revert back to their pre-2009 level.
It sold for $25,875. Trends remains stuck at $15,000. So what gives?
I attribute the rise in prices to a few things.
1) When my book on New Orleans gold came out a few years ago, more people learned about this date’s rarity. The new information clearly drove up demand.
2) Liberty Head eagles have quietly become a popular area for collectors in the past few years. Many non-specialists are not aware of this but there are a number of new collectors building sets in this series.
3) It has become more market-acceptable to buy truly rare coins and you can’t argue with an issue that has an original mintage of fewer than 1,000.
4) Once the bar was raised in 2009 for this date, it became impossible to buy the 1883-O at old levels. In other words, the person who was brave enough to pay nearly thirty grand for an EF45 in the Heritage 2/09 sale made it numismatically acceptable for everyone else to pay close to this amount (or more in some cases) down the line. In a thinly-traded market, sometimes all it takes is one impressive auction result to make the market double or triple literally overnight.
The moral of the story? If you see other truly rare coins like the 1883-O eagle that are clearly undervalued but have compelling reasons to appreciate in value down the road, be a pathfinder/trailblazer and jump in before the masses follow.