The 1854-S Double Eagle: A Study

The 1854-S double eagle is one of the most interesting Liberty Head double eagles. It is widely acclaimed by collectors due to its status as the first double eagle from this mint, and the rarity of the quarter eagle and half eagle from this year makes it a famous coin as well. That said, it is an issue that is not well understood and one whose rarity profile has been made confusing by inconsistencies from NGC and PCGS.

The 1854-S has a high original mintage figure of 141,468 and one would expect it to be available in higher grades. This is not necessarily the case, despite what appears to be a decent number in Uncirculated as per the grading services’ current figures.

As of August 2013, NGC had graded a total of 48 in Uncirculated, including 23 in MS63 and another 10 in MS64. PCGS had graded a total of 55 in Uncirculated, including 17 in MS63 and another three in MS64. With a total of 103 graded in Uncirculated, we can conclude that the 1854-S is only a marginally scarce coin in higher grades and it seems more available in comparably high grades (i.e., MS63 and higher) than such contemporary non-shipwreck dates from this mint as the 1855-S, 1858-S and 1859-S.

However, this is not the case.

What the NGC and PCGS populations fail to address is the fact that virtually every Uncirculated 1854-S double eagle is a shipwreck coin. And what’s worse is that these are designated on the holder as being from a shipwreck - and both services seem wildly inconsistent with how this date is graded and why some blatantly “environmental damage” coins are in “normal” holders while others are not.

Essentially every high-grade 1854-S double eagle is from the S.S. Yankee Blade shipwreck which was found in 1977. This wreck contained approximately 200-300 coins. These were Uncirculated coins which must have been spectacular before the boat carrying them sank; the survivors tend to show very few marks but they have matte-like surfaces from exposure to seawater. Some examples have less etching in the surfaces than others; some are clearly salvaged and have oxidation as well as scratches from the process of removing crud from the surfaces.

What few collectors realize is that, as with the 1854-S eagle, the survival rate of high grade 1854-S double eagles with original surfaces is exceptionally low. I have seen exactly three with original surfaces which I grade Choice AU to Mint State by today’s standards. In comparison, I have probably owned 20 examples graded MS62 to MS64 but with “unoriginal” surfaces.

The choicest 1854-S double eagles I have seen with original surfaces include a PCGS 61 from the Bass collection (ex Bass III: 781 at $10,450; I later sold this coin to a collector on the East Coast), an NGC MS61 which I bought out of a Heritage sale around ten years ago (and can’t currently remember the exact pedigree), and a PCGS AU58 which I purchased from a New York dealer around four years ago and which was very choice for the grade. I believe that a few others are known but I can stately with reasonably strong conviction that none exist in grades higher than MS61.

There are certain diagnostics seen on the Yankee Blade coin which are not seen on the coins with original surfaces. Some of these are as follows:

1. The shipwreck coins always have an obverse die crack which runs up from a denticle at 6:00 on the obverse through the left side of the 5 in the date, terminating at the truncation.
2. The reverse has a total of three cracks. The first runs into the field (at the viewer’s left) from the base of the N in UNITED. The second crack begins between the denticles left of the first T in TWENTY up to the left tip of the letter. The third begins at the tip of the T in TWENTY and travels left into the field ending below the N in UNITED. On the late die state, these three cracks meet below the base of the right foot of the N in UNITED.
3. The shipwreck coins always show a broken crossbar in the A in STATES.

The original surface coins do not show these die cracks. They do have a similar mintmark, and all seem to have the broken crossbar. Interestingly, there are a number of small raised die dots on the obverse with two to the right of the 4 in the date, and three at the throat. There is also a small raised die dot on the neck.

I don’t believe that the original surface coins are from a different die pair than the seawater coins; just a different die state.

Breen lists four different die varieties for the 1854-S, but one of these is a Proof-only die (the unique coin in the Mint Collection) while another, described as having “extra thin numerals and letters,” is just a late state with lapped dies. He states that 8 pairs of dies were created and that the mintmark “usually…touches the tail; though on one it is free.” (He then states that on one it is “embedded.”). I have only seen one reverse and it always has a broken A in STATES and a mintmark which firmly touches the tail at its top.

There is, of course, another significant difference on the original surface coins and that is a different texture from a lack of exposure to seawater and sand.

Original surface 1854-S double eagles typically show a deep green-gold or orange-gold hue. The luster doesn’t tend to be as frosty as that seen on 1855-S or 1856-S double eagles. The overall look tends to be subdued with multiple abrasions from hard circulation.

There are two distinct looks for seawater 1854-S double eagles. The first is blatantly matte-like with heavy environmental damage; some of these are slabbed as “normal” coins by NGC and PCGS while others are “details only” or “genuine.” The more familiar look on the Yankee Blade coins is bright and slightly matte-like with rich yellow-gold color and a virtual absence of circulation marks on the surfaces.

The normal surface 1854-S double eagles should sell for a significant premium in all grades due to the scarcity. This date is seen from time to time in the EF40 to AU50 range, but it becomes very scarce in AU53 to AU55, and it is very rare in properly graded AU58. As I mentioned above, I have seen only three examples with original surfaces in Uncirculated and doubt if more than five or six exist.

For more information on Type One double eagles, I invite you to look through the blog and articles archive(s) on raregoldcoins.com or email me at dwn@ont.com with specific questions.

What Do Original United States Gold Coins Look Like?

Around a year ago, I wrote a blog that discussed original 19th century United States gold coins and used photos of specific coins to illustrate the points I was attempting to make. This was one of the most popular blogs to ever appear on www.raregoldcoins.com and I was pleased to get the positive feedback it generated. At the recent FUN show, I was shown two collections of coins. One consisted of around two dozen Charlotte and Dahlonega coins while the other had around 30 early gold coins. All were graded by PCGS or NGC and in both instances the owner prefaced his show-and-tell by informing me that all the coins were sold to him by dealers who stressed their "originality."

Out of the 50 or so coins I looked at, around five were what I would describe as being "original." This made me realize that most collectors do not understand the concept of originality and that it would be a good time to dust off the old "how to tell originality" blog.

1. 1807 Bust Left $5.00 Graded AU55+ by PCGS

To me, this coin is just about the most perfect piece of lightly circulated early gold that you are likely to find. I think its an AU58 instead of an AU55+ but that's just splitting hairs; what can not be denied is this coin's exceptional color and overall originality.

There are a numbers of factors that make me believe that this piece is original. First is the depth and evenness of its color. Note the "age" of the color and how well it blends. Artificial color looks "newer" and never blends as well as old, mellow natural color. Secondly, note how the underlying luster is still undisturbed and in a perfect cartwheel pattern. This is most clear at the obverse border where there is considerable mint luster at the stars. Thirdly, note the absence of hairlines or other imperfections that might have been caused by a prior cleaning.

2. 1852-C $5.00 Graded AU53 by PCGS

I almost decided not to use this coin as an example. Its sort of like going to the gym, choosing the biggest lunkhead you can find and then holding him up as an example of a fit guy to a bunch of scrawny non-lifters. Just not fair, right?

The first sign that this coin is very original is the depth of its coloration. Note the very deep and very even hues that can be seen on the obverse and reverse. Coin doctors are never able to reproduce this deep green-gold hue and most artificial toning on gold tends to be more of a bright orange or slightly off-kilter red hue. Another sign of this coin's originality is the fact that the few marks on the surfaces are not shiny or bright. On artificially toned or processed coins, the chemical agents used to color the coins tend to break down over time and there is often discoloration or brightness within the recesses of the marks on the surfaces.

3. 1856-O $10 Graded AU53 by NGC

This attractive coin has a few things that lead me to believe that it is original. The first is its deep, even green-gold color. Note that the hues are consistent on the obverse and reverse. The second is that there is no "filminess" atop the surfaces that might be caused by it having been puttied. The third is the presence of dirt deposits in the protected areas of the obverse and reverse. Note around a number of the stars and within the reverse lettering: there are raised black dirt "chunks" which would quickly dissolve if this coin were dipped in a chemical solution or even put into a soap and water bath to lighten it.

4. 1833 Large Date $5.00 Graded MS63 by PCGS

The common theme so far in with these coins have been their deep, dark original coloration. But what about coins that are lighter in hue and higher in grade? Can a coin that is not dark still be original? In the case of this 1833 half eagle, a coin that I bought and sold at the 2011 FUN show, it certainly can. One of the first things of note about this coin is the fact that it is an old green label PCGS holder. This, of course, doesn't mean it is a guaranteed original coin. But what it does mean is that it was graded at least 15 or so years ago and nothing was placed on the surfaces by a coin doctor as a chemical or substance would have broken-down by now and become visible.

This coin is bright and vibrant but it isn't too bright or too vibrant. I'm not sure this makes sense to a new collector but long-term collectors will immediately realize the difference between a coin that is naturally bright and one that has been brightened. The luster on this coin is completely undisturbed and, as is typical for half eagles from this era, it has a sort of "pillowy" texture. Also, note that the color is a rich light yellow and green-gold. This is characteristic of original Fat Head eagles and this is something that is not seen much, anymore, on the surviving coins from this era.

5. 1814/3 $5.00 Graded MS62 by NGC

This is a tricky coin and one that would probably cause the greatest amount of dissent if I showed it to a number of experts. As you can see from the photos, it is very richly toned, in fiery reddish-gold hues. Red is often a color on early gold that has been applied. But in the case of this coin, the hue and intensity of the red is "right" and it has, to the best of my knowledge, never been duplicated by coin doctors. You can also see that the color lies nicely on the surfaces and is variegated with a number of different hues. Artificial color is more monochromatic and does not have the subtle gradations that a natural piece like this displays.

A few other facts about this coin are compelling. First, it is interesting to note that I have handled at least three 1814/3 half eagles in Uncirculated that have had reasonably similar intense reddish-based color. Having seen similar colors on other examples makes me even more certain that the color is genuine. And, the coin is housed in a very old NGC "fatty" holder which means that it was graded nearly two decades ago. If this color wasn't real, it wouldn't look so good after two decades in an NGC holder.

6. 1880 $20.00 Graded PR63 by NGC

Brilliant Proof Liberty Head gold coinage is almost never seen anymore. Most examples have been dipped and/or conserved in an attempt to generate higher grades from the third-party services and in order to receive Ultra Cameo designations.

In the 2011 FUN auction, Heritage sold a number of superb quality Proof gold coins from the Miller collection that were notable for having natural coloration. These coins were purchased in the 1970's and 1980's; back when collectors knew what original proof gold looked like and it was appreciated for what it was. This 1880 double eagle was from that sale and collection.

There are a few things that immediately show this coin is original. As simplistic as this sounds, the first is that it isn't blindingly brilliant. Note, instead, how there is rich copper-orange toning which deepens towards the borders. Also, there is a copper spot on the reverse between the two L's in DOLLARS. Proof gold that has been conserved doesn't have these spots. Finally, there is an even natural "haziness" atop the surfaces that exists on original Proof gold. Note that I did not say "filminess" as in "this coin has been puttied and is now filmy."

Hopefully, this blog has been helpful. There is, of course, no substitute for seeing original coins live and in person but in the absence of doing this, these images and descriptions should be a step in the right direction.

Coins with Character

In 2010, you will see a new slogan on the homepage of my website (www.raregoldcoins.com). Besides being catchy, “Coins with Character” represents a philosophy that guides me as a buyer and which I try to impart to collectors. Let me explain what, in my opinion, this expression means. Before the recent November Baltimore coin show, I sat down and made a list of the sort of coins I wanted to make an extra effort to purchase. These were coins that I didn’t already have in stock and given their popularity and ability to sell it made sense to me to reload.

High on this list were nice, affordable Dahlonega coins in the EF40 to AU55 grade range. My parameters were that the coins were choice, original and, in some way, “special.” In other words, I was looking for coins that spoke to me; coins with character.

After a lengthy search through the various auctions, dealer inventories and private collections that I encountered in my three days in Baltimore, I was able to acquire a whopping total of four Dahlonega coins that I felt had character: one gold dollar, one quarter eagle and two half eagles. Was I surprised that my quest would prove so fruitless? Not really. I was, of course, disappointed. But given my parameters for “coins with character” I wasn’t surprised.

I generally try to purchase coins that I believe are in the top 5% known for a particular issue. This doesn’t means that they are necessarily in the top 5% as far as grade goes. What I am looking for are coins that because of one or more reasons would rank among the most desirable survivors of a specific issue.

There are a number of things that give a coin “character.” These include the following:

-Attractive natural coloration. Coloration is a major factor in valuing copper and silver coins but it has been undervalued when it comes to gold coins. This has never been the case for me. I personally love gold coins with attractive natural hues; especially rich rose, green or orange shadings. Now this does not mean that I like every toned gold coin. I see dark, dirty double eagles from time to time that are unattractive and which, quite frankly, I’d probably dip or bathe them in soap and water if I purchased them.

I readily dislike bright, shiny, “processed” coins. To me, a coin that is bright and shiny lacks soul. I like attractively toned coins because of their individuality.

One of the reasons that I don’t buy as much Proof gold as I used to is the fact that most pieces have been conserved and they all look the same. Here’s what I mean. Take a coin like an 1880 quarter eagle in Proof. Only 36 were minted and this issue’s rarity and relative affordability makes it very intriguing to me. But I’ve passed on the last three that I have been offered because they were all bright, monochromatic and character-free. They were the Stepford Wives of Proof gold. Conversely, if I were offered a Proof 1880 quarter eagle with nice original hazy golden-orange color, I’d almost certainly buy it; even if it were “only” a PR63 with signs of a light old cleaning.

-Uncommonly Sharp Strikes and/or High Quality of Manufacture: As someone who buys and sells quite a bit of early gold (i.e., U.S. gold produced prior to 1834) I am pretty knowledgeable about how certain issues are supposed to look. As an example, most 1796 eagles have surfaces that appear pockmarked. This is mint-made but it means that the majority of 1796 eagles are not very attractive. So when I see a 1796 that has smooth, non-pocked surfaces I get excited. On an issue that is typically seen poorly made, a well-made example has “character” in my book.

I feel the same way about strike although I readily admit that strike is not extremely important when it comes to pre-1900 gold coins. But when I see an issue that is notorious for a poor strike with above-average detail, this imparts character as well.

-Important Provenance: The history and romance of collecting is, in many ways, just as interesting as the history and romance of coins. It means a lot to me that an 1838 eagle or a 1797 quarter eagle that I buy has an illustrious pedigree. I have owned coins that have traceable pedigrees dating back to the middle of the 19th century and I find it very exciting that I am able to add my name to the list of illustrious and not-so-illustrious individuals that might have been in a coin’s pedigree chain.

One of the reasons that I really respect collectors of early copper and Colonials is that they value pedigree more than nearly any other segment of the market. It certainly helps that there have been active collectors in these market areas dating back to the 1850’s whereas in an area like branch mint gold, specialized collection began far later.

Would I pay extra for a coin with a great pedigree? For the most part I would. Of course, a lot depends on the coin. I doubt I’d pay any extra for, say an Eliasberg quarter eagle that was an overgraded common date or even a scarcer date that had been dipped or processed after it had appeared in the Eliasberg sale and which now lacked character.

-Coins That Break the Mold: Every dealer has a list of “pet dates” that he or she just can’t resist buying. For some dealers it might be an issue that triggers a sense of nostalgia. For others it might be a date that they have traditionally bought and sold with ease in the past. A pet date for a collector is more likely to involve his perception that an issue is undervalued or it has important historical associations.

I won’t bore you with the full list of dates that I’m a sucker for (there are lots of them, I’m afraid...) but these are coins that I tend to be a little more lax about when it comes to the Test of Character. As an example, I actually bought a damaged 1864-S half eagle earlier this year. It was the first “problem coin” that I have ever listed on my website and if it wasn’t for the fact that it was so rare, I would be never bought it and listed it for sale.

-Coins with Original Surfaces: I thought I would save the best for last. I like original coins (or at least what I perceive to be original coins). When I say “original” I am referring to coins that appear to have not been dipped, processed or harshly clean in recent years. A coin that I describe as “original” could very well have been cleaned fifty or a hundred years ago but it has subsequently acquired natural second generation that might mask underlying hairlines.

Why do I like coins with this sort of look? It all goes back to the original thread of this blog: they have character. It is hard for me to get excited about a 150+ year old gold coin that is bright and shiny. It is hard for me to pinpoint the exact reason why I prefer the original look but suffice to say I do and I will continue to buy coins with character for my inventory.

ValueQuest 2009

I have the feeling that the Numismatic Buzzword for 2009 is going to be “value.” If you are like most collectors, your purchases in the coming year(s) are not going to be as extensive as they were in the past. If you are buying fewer coins, you’ll want to stretch your coin purchasing dollars and look for pieces that offer the biggest bang for the buck. I have a few suggestions, which are mainly conceptual in nature, to guide you along the Value Trail. Regardless of series, date or mint, coins that have a nice, original appearance are very rare. My definition of “original” is a coin that appears to not have been cleaned, dipped, processed or otherwise enhanced in recent generations. In many series, especially ones like early gold and southern branch mint gold, truly original coins probably represent less than 5% of the available population. If you don’t believe me, take a look sometime at a large auction that is held in conjunction with a major convention. Assuming that you know what you are looking for, my guess is that you’ll see coin after coin that is too bright or bleached out or bedecked with “unusual” coloration. In some sales there may be thirty or forty early gold coins and only a small handful that fit my criteria of originality.

It makes sense to me that if you are going to buy fewer coins in 2009 (or, who knows, maybe you won’t buy fewer coins, just less expensive ones...) you should be buying prettier, more aesthetically appealing ones. And one of the things that I am continually amazed about in the rare date gold market is that, when they are available, choice, original pieces tend to only bring a small percentage (10-20% at most) over the typical “schlock” that is usually offered.

Another important point to consider when purchasing coins with a newfound appreciation for value is current market price versus prices in 2002-2003. I use 2003 as the point in time that prices in many gold series began to rise significantly. As an example, many early gold coins that were worth $6,000-8,000 in 2002-2003 had been at that level for quite a few years. Today, these same coins may be worth $10,000-12,000 or even more in some cases.

If you own stocks, you are probably well aware of the fact that the drops in the market since early September have basically eroded all stock profits achieved in the last five years. While the coin market has, so far, held its value far better than I would have expected, it is certainly a possibility that today’s $10,000 coin could certainly drop to $6,000 in a fairly short period of time. By studying the past history of specific subsections of the market, the value- conscious collector should have a clearer idea of potential downside.

There are actually a number of rare date gold coins that are worth the same today as they were in 2002-2003. Examples include very high grade Charlotte and Dahlonega issues (in this case MS63 and above), many San Francisco issues from the 1850’s, 1860’s and 1870’s and even a number of New Orleans gold coins. The reasons for this range from the market being damaged by too many overgraded coins in holders (in the case of Charlotte and Dahlonega pieces) to collector indifference (in the case of the San Francisco coinage) to poor reporting of prices by Trends and CDN (in the case of New Orleans issues).

Just because a coin was worth $5,000 in 2003 and it is worth the same today does not mean that it offers the “best” value to a buyer in 2009. But, it is interesting to ponder if coins such as this might have less downside than areas of the market that have shot up considerably.

Which brings us to the third and final point to consider in our Valuequest 2009. Liquidity is likely to be a huge factor in the coin market in the coming year(s). This is probably no time to be “cute” when it comes to your coin purchases. My guess is that coins that had limited appeal and liquidity issues in the good market of 2003-2008 might have virtually no appeal and liquidity in the potentially-not-so-good market of 2009 and beyond. In other words, key dates may drop in price somewhat but they are still likely to have a lot of collector demand. And to use an analogy from the non-gold coin market, series such as Three Cent Nickels, Shield Nickels and Liberty Nickels have and will probably always be also-rans because they are just not especially interesting in the opinion of most collectors.

So, in summary, I believe that three of the key elements that will drive the market in 2009 are originality, current price levels versus pre-bull market prices and liquidity/popularity. These were obviously key elements in years past but with the market euphoria of the past not likely to be seen for awhile, I think they will be more important than ever.

1841-D Quarter Eagle Graded MS63 by PCGS

As a leader in the area of rare United States gold, I get to handle some pretty interesting coins on a regular basis. But every now and then there is a piece that comes into my inventory that is so truly exceptional that it gives me pause and makes consider keeping it instead of selling it. The most recent of these was an 1841-D quarter eagle graded MS63 by PCGS that is not only the finest known example of the date but one of the most aesthetically attractive Dahlonega gold coins of any date or denomination that I have seen. I rank the 1841-D as the fifth rarest of the twenty quarter eagles produced at this mint. There were a total of 4,164 struck of which an estimated 75-100 exist. When available, the typical 1841-D grades VF to EF and is characterized by poor eye appeal and extensively abraded surfaces. There are probably fewer than fifteen properly graded AU’s known as well as four in Uncirculated.

The four Uncirculated examples are as follows:

1. Kansas Collection, ex: Doug Winter, Wexford Collection, Doug Winter, Heritage 1/04: 1017 ($40,250), Green Pond Collection, Doug Winter, Bowers and Merena 11/98: 2076 ($46,000; as PCGS MS62), Heritage 2/90: 1264 ($15,000), Vintage Auctions 8/89: 286 (unsold), David Akers’ session of Auction ’89: 859 ($22,000). Graded MS63 by PCGS.

2. Private collection, ex: Heritage 4/06: 1496 ($46,000), Duke’s Creek Collection (as PCGS MS62), Hancock and Harwell, William Miller collection, Heritage 1993 ANA: 5508 ($25,300). Graded MS63 by NGC.

3. Georgia Collection, ex: Larry Jackson, David Akers 5/98: 1735 ($35,200), John Pittman collection, Stack’s 10/60: 3192 ($270), Milton Holmes collection. Graded MS61 by NGC.

4. Kansas Collection (duplicate), ex: Doug Winter 4/00, Mark Hurst collection, Heritage 1999 FUN: 7627 ($21,850; as PCGS AU58), North Georgia Collection, Stack’s 10/94: 867 ($22,000), James Stack Collection. Graded MS60 by NGC.

As you can tell from this list, I have had the good fortune to handle two of the four Uncirculated 1841-D quarter eagles and I have handled the finest known on three different occasions.

Let’s take a look at the coin itself. Here is a superb quality photo of the finest known 1841-D quarter eagle. Study the obverse and reverse for a few moments and then let me take you on a “tour” of it and explain why I think it is such a great piece.

What grabs me first about this coin is its coloration. You will note that the obverse and reverse both show deep brownish-gold coloration. If you ever wondered what exactly does a 160+ year old gold coin with completely original color look like, the answer is “like this.”

You will also note a bit of light haze on the surfaces. “Haze” often has the connotation of a coin having had a chemical applied to its surfaces in order to hide hairlines but on this coin, the haze comes from the way that it had been stored in the past; probably in an old coin cabinet or in a manila coin envelope. Before the era of extensive coin doctoring it was not uncommon to see choice, high quality gold coins with this sort of natural haze on the surfaces.

Next, look at the strike. The 1841-D quarter eagle is generally seen with a pretty good strike but this example was absolutely hammered with complete details on both the obverse and the reverse. If anyone doubts that the Dahlonega mint was capable of producing a product on the par with the Philadelphia mint from time to time, take a look at this coin and re-think your answer.

You will probably also note a thin, winding die crack on the obverse and a major bisecting crack on the reverse. This is the late die state of Winter Variety 2-C.

The depth of the coloration makes it hard to see the luster in its entirety but it is abundant. The texture is frosty and semi-prooflike, the blending of which creates a really unique look that I have not seen on more than a handful of Dahlonega gold coins.

The surfaces show a few light marks (mostly in the right obverse field) but they are very clean. When comparing this coin to the few MS63 and better Dahlonega quarter eagles that exist, I would certainly call this 1841-D a very high end example and I think it has claims to an MS64 grade.

In my experience, quarter eagles are among the hardest of the four denominations produced at this mint to find in high grade and it is exceptionally hard to find any coins that grade MS63 or better. I can only think of one true Gem Dahlonega quarter eagle (the Duke’s Creek 1847-D that was graded MS65 by NGC) and probably not more than three to five single coins that, by my standards, grade MS64.

If you are collecting Dahlonega quarter eagles by date or if you are a type collector looking for a single very high grade piece, my advice is to be aggressive on the very rare occasions that a coin like this 1841-D become available. Many years may pass before a comparable—or better—piece become available again.