The "Ten Favorite Coins in Ten Weeks" Series: A Look at Some Interesting US Gold Coins

If you are a sports fan, you are probably aware of the wonderful ESPN series 30 for 30. As I watched an episode a few nights ago about the sad demise of the Big East conference, I thought about doing a blog series which looked at 30 of my favorite coins over the course of 30 days. After realizing this was waaaaay over ambitious, I tempered my initial enthusiasm to ten coins in ten weeks.

So here’s the skinny.

Every week I’m going to choose a coin which, after my nearly three decades as a professional dealer, still gives me goosebumps to buy. You’ll be surprised by some of my choices. Some won’t be gold coins but will be nostalgia-based due to my early days in the coin market (hint: I’m still intimidated by those gaping holes for the 1856 and 1877 in my circa 1968-70 Flying Eagle and Indian Head Penny set). Others won’t be rare in the true sense of the word, but will have a design or an historical element which still appeals to me. And yet others won’t be specific dates but rather types (Fat Heads!) which get me hot and bothered to this day.

While this is probably a social media pipe dream, I’d love for this series to be interactive and for you to share with me (and the readers of this series) your thoughts on the coins I select and your own "10 in 10."

Look for this series to begin next week.

I Bought a Modern Coin...and I Liked it.

Those of you who know my numismatic taste knows that it tends to run to coins dated 1890 and earlier, and coins which are truly rare. I have mostly avoided the modern coin market for a variety of reasons but one stands out: I generally don’t like the designs of modern coins (exceptions: the High Relief St. Gaudens and Buffalo revivals), and the thought of collecting them doesn’t personally appeal to me.

Confession time:

I participated in the recent offering of 2014 Baseball Hall of Fame commemorative issues, and did so in the most mercenary way: I bought them, paid extra for NGC and PCGS gimmick labels (early release or something of this ilk) and flopped them as fast as I could get my greedy little hands on them.

When I arrived at the recent Baltimore coin show, I had just barely heard that the new Hall of Fame coins were going to be released in limited quantities. Being a lifetime baseball fan, these coins appealed to me from a historic perspective. Being an art aficionado, the revolutionary new designs of these coins appealed to me as well.

I didn’t really have time to formulate a game plan, but I knew these coins were going to be winners. I also knew that there would be a decent opportunity to buy them and flip them for a decent profit. I quickly realized that given the limits of how many coins I could buy, and the fact that this would take away from my main reason for being at the show (buying and selling rare 18th and 19th US gold coins), my participation in the Great Baltimore Baseball Coin Flip was going to be modest at best. Still, for Mr. Rare Coin Snob, any sort of participation in the modern market seemed like a blog topic at the very least.

To make a long story short, my wife (who was with me at the show) got on line around 10am, somehow was third in line, and waited until 10:58am when she texted me that the line was starting to move, and to get over to the Mint booth ASAP.

We each bought our full allotment, and quickly ran the coins over to be graded. On the way there, a friend suggested that I split the coins in half to “hedge” my grading. This seemed like a pretty clever idea so while I submitted them to NGC, my wife walked them over to PCGS. A day and a half later we had them back, all in MS/PR69 and 70 holders, and looking pretty spiffy if I may say so.

Since I promised my wife the full profits from this deal as she was the one who patiently waited in line (her impatient husband doesn’t “do” lines very well…) I then asked her how she wanted to sell the coins. I gave her a few options: we could flip them immediately and make a pretty decent profit, we could hold them for a few weeks or months and see how the market for these coins played out, or we could sell them on E-Bay. She chose her own option: she decided to consign them to Great Collections where, even as we speak, they are being offered for sale.

A few quick observations about my foray into moderns:

 1. The U.S. Mint could turn me into a Libertarian.

I don’t often deal with the mint so I didn’t realize I was dealing with such a low-tech operation. When it was time for our orders to be filled, they were both done incorrectly and done without barcodes and scanners. I heard that the fulfillment issues grew worse as the line grew longer.

Some other news that might make me embrace Ron Paul: the Mint ran out of gold coins a few hours into the sale and had no contingency plans to bring more coins in; even though they could have sold hundreds if not thousands. The Mint had no idea that they were going to be so successful, and didn’t even bring stanchions for the long lines which even a Modern Coin Newbie like me knew would inevitably form. The Mint personnel at the show seemed nice and they seemed overwhelmed. Perhaps a little marketing meeting before the sale might have helped…

2. I LOVED the design of the coins.

I had vaguely followed the story about the Baseball HOF coins in the numismatic press and from the printed/online images they looked OK. In person, they were far better. The concave/convex design is unique in American numismatics and it is an impressive feat from a technological standpoint. The design was “different” without being hokey and as a collector, this is a modern coin I might actually want to own. I liked the gold coins the best and I liked them as Proofs better than I did as business strikes.

 3. Modern coins are a PITA

One of the reasons I don’t deal in modern coins is that they are extremely labor intensive. As an example, when I got them graded, I had to remove all the coins from the original packaging; taking care not to destroy the packaging or discarding the COA’s. Yes, I know this sounds very wimpy, but it was time consuming and really kind of a pain. The whole key to buying and selling modern coins is a mastery of logistics. I’m a pretty good coin dealer, but I am crappy at logistics, hence my decision to stick with what I know best.

4. The Mint hit a home run with the Baseball HOF coin.

I couldn’t write a blog about baseball with using this cliché. Just couldn’t. Sorry.

Do you buy rare gold coins?

Do you have coins to sell?

Would you like to have the world’s leading expert with you assembling a set of coins?

Contact me, Doug Winter, directly at (214) 675-9897 or by email at dwn@ont.com.

Ten Buyer's Tips for San Francisco Gold Coin Collectors

If you are a collector of San Francisco gold coins, there are a few buying tips I’d like to offer. These range from pretty basic to pretty savvy, and they can be applied (in some cases) to other series if San Francisco coins are not your particular cup of chai.

1. Don’t Pay Shipwreck Prices for non-Shipwreck Coins

It is an established fact in the market that coins from the major shipwrecks are worth a premium over non-shipwreck coins. This is especially true for S.S. Central America coins with low shipwreck populations. But this information can be misinterpreted and can cause a collector to overpay. Let me give you an example.

Recently, I was offered a decent quality AU58 1855-S double eagle by another dealer. As part of his sales pitch, he mentioned that an example had recently sold for $7,931; thus his coin, priced at $7,500, seemed like a good deal. What he conveniently failed to mention to me was that this auction price was for a coin pedigreed to the S.S. Central America and that the last non-SSCA coin had brought $5,288. Once I mentioned this, his reaction was a simple “oh…I forgot to mention that, huh?”

When you are figuring prices for S mint coins, especially Type One double eagles, the sales records for shipwreck coins have little bearing on non-shipwreck coins and vice versa.

2. Don’t Pay Full Shipwreck Prices for Re-Packaged Coins

The premiums that shipwreck coins sell for are packaging-dependent. In other words, an AU58 1855-S double eagle from the S.S. Central America is worth more (quite a bit more in fact) if it is in an original PCGS gold-foil holder than in an NGC holder. Why? Because in this instance, the coins from the SSCA were originally graded by PCGS, and collectors want them in their original packaging.

Another example: in 2013, three PCGS/CAC MS66 1857-S double eagles in their original gold-foil holders were sold at auction, and they brought $32,900, $32,900, and $33,030. Two NGC MS66 examples sold this year and they realized $17,625. Why? Because the market clearly realizes that these coins were formerly PCGS MS65’s and because they are no longer in their original holders.

3. Premium Quality San Francisco CAC Coins Can Be Worth Significant Premiums

As I have previously discussed, many San Francisco issues do not come nice, and it is likely that their CAC populations will be very low. Let me give you two quick examples.

The 1862-S half eagle is a very scarce date in all grades and it is seldom found choice and original. PCGS has graded 39, and CAC shows a current population of just two coins; an EF40 and an EF45. Now granted that many 1862-S half eagles in PCGS holders have not been sent to CAC, but the fact two only two have been approved (and none above EF45) indicates that this is an issue that is not seen with a nice, natural appearance.

As another example, let’s look at the 1862-S eagle; a date which is nearly as rare as its half eagle counterpart. PCGS has graded 45 examples and CAC shows a current population of just two: an EF45 and an AU55. Again, not all the PCGS coins have been sent to CAC, but my feeling is that the percentage of 1862-S eagles (and half eagles) with CAC approval will remain very small; probably less than 10% of the coins graded.

It seems to me that CAC approved examples of the 1862-S half eagle and eagle should be worth a fairly significant premium above their non-CAC counterparts.

4. How Do You Price Very Rare Date San Francisco Gold?

When it comes to rare/very rare San Francisco gold coinage, most published price guides are of little to no use. Auction prices are far more relevant, and this is how I price such coins. So how do you price a coin in, say, EF45 when the last auction record was in 2008?

Here are some of the factors that I take into consideration when pricing San Francisco gold. First, is the coin fundamentally rare? In the case of the aforementioned 1862-S half eagle and eagle, these are issues which are rare in all grades. Secondly, how nice is the coin which is being offered to me? Is it abraded, not terribly original and softly struck, or is it relatively free of marks, original and well impressed for the issue? If it is the former, an older auction record might have some weight with my pricing. If it is the latter, I know I will have to stretch; maybe considerably.

5. The Two Distinct Groups of San Francisco Gold

As San Francisco gold becomes more popular, we are seeing a distinct bifurcation of the market: the coins made prior to 1879 which tend to be rare in all grades, and the coins made after 1879 which tend to be rare only in high (or very high grades).

I think we will continue to see quite a bit strength in the rarity-driven market as collectors tend to be more interested in coins like 1862-S half eagles in VF than in 1892-S half eagles grading MS64. The market for condition rarities will be more hit or miss. Certain coins, including many of the “top pops” from the Saddle Ridge Hoard, will be eagerly absorbed into collections. Others may prove far harder to sell.

6. Year Sets Will Become Popular

There were six different denominations of gold coinage produced at the San Francisco mint. There were just four years in which all six denominations were made, and one of these includes a unique issue (the 1870-S three dollar). This leaves collectors with three possible choices for six-coin year sets: 1856, 1857, and 1860.

None of these three years contains an impossible rarity, and the first two years could even be completed in Uncirculated grades. The 1860-S is the most difficult set as the half eagle and the eagle are both rare in all grades, and virtually impossible to find above AU55.

I don’t think these sets are The Next Big Thing in coin collecting, but I wouldn’t be surprised if a few savvy collectors attempted to complete at least one year.

7. Learn What Real Color Looks Like

There are numerous high-value San Francisco gold coins in both PCGS and NGC holders which have questionable color. I suggest you learn what original color looks like for the San Francisco issues which are of interest to you. Notice I didn’t suggest you learn how to grade; I think most of you taking the time to read this have other things to do with your few free minutes per day. But I do think it’s important to learn that, as an example, all 1862-S quarter eagles are supposed to have a certain shade of color, and if you see one which isn’t close to this shade, it’s likely been enhanced.

How do you learn what original coins look like? Look at catalogs with old time collections (Bass, Norweb, James Stack, and Eliasberg) and study the hues/patterns of color that these coins had. Go to the ANA Museum in Colorado Springs and study the Bass coins. Carefully study the raregoldcoins.com Coinapedia to see hundreds of pictures of unmolested, original coins.

8. Learn How to Differentiate Strike vs. Wear on Type One and Type Two Double Eagles

Many new collectors of San Francisco gold are thrown off by the difference between strike and wear on Type One and Type double eagles; two of the most popular series from this mint.

As you begin to learn about these coins, you will begin to determine that certain issues are always found with weakness on the hair or on the stars or even at the centers. Learn which issues are struck which way. This is reasonably easy to do as photo archives for higher grade San Francisco double eagles can be found on ha.com or on PCGS Coinfacts.

9. Best Value Grades

I have written before on Best Value Grades. As San Francisco gold coins become more popular and increase in value, I think this is an important point for collectors to consider.

10. Does Size Matter?

So far, the San Francisco gold coin renaissance has been led by large-size coins: eagles and double eagles. Will this increase in popularity carry over to smaller coins?

I can see gold dollars and three dollars from this mint becoming popular due to the possibility of these being collected by series, and the possibility of these sets being completed.

The quarter eagles from this mint I’m not as sure about. The fundamentals of these coins make sense to me. Other than the 1854-S, all the issues are obtainable and many can be purchased in Uncirculated grades for under $5,000. But with the exception of the Civil War issues, these coins have just not yet caught on with collectors.

The “wild card” series is the half eagles. These are already reasonably expensive coins and in the case of the Civil War rarities, and they are more expensive than most any southern branch mint half eagle while (currently) being far less popular. It is hard to call a moderately popular (but indisputably rare) issue like an 1862-S half eagle “undervalued” when it is already a pricey coin. But “value” is relative, especially in the rare date gold market and I think San Francisco half eagles—at least those struck prior to 1878—are destined to become very avidly collected in the next few years.

Do you buy rare gold coins?

Do you have coins to sell?

Would you like to have the world’s leading expert with you assembling a set of coins?

Contact me, Doug Winter, directly at (214) 675-9897 or by email at dwn@ont.com.

The Saddle Ridge Hoard: Some Thoughts

Unless you spent the last two weeks in deep space you have no doubt read about/discussed/dreamt about the fabulous Saddle Ridge hoard. Enough has already been written about the background of this hoard that I won’t repeat it here. (NBC News, BBC, CNN, Yahoo, etc.) The scope of this find has truly captured the fancy of the collecting and non-collecting public alike, and I have been asked about the coins dozens of times; from people ranging from good clients to my doctor to my barista who chatted  me up about the “stolen coins” while making me a pour over macchiato today at my local coffee joint. This is a story with legs.

What I find fascinating about this story is that it is the first great “treasure “ to be found in the day of Web 2.0. When the lost 1913 Nickel was rediscovered a few years ago, it certainly made the rounds on the web, but stayed mainly in numismatic circles. And when the greatest find of them all, the S.S. Central America, was discovered oh so many years ago, there wasn’t even an internet around for the story to go viral; it had to build its momentum over the course of months; not moments.

As I mentioned above, I have been asked a lot of questions about these coins; enough so that I thought it made sense to blog about them so I could just say “read my blog” the next time someone asks me the following.

Here are some thoughts about the Saddle Ridge hoard that I’d like to share.

1. As I mentioned above this is the first truly viral story involving numismatics and the all new (and not necessarily improved) interwebs.

Much of the information I read online about the source and origin of the coins was seemingly invented by reporters who never bothered to check their source(s), and some blatantly wrong numismatic information was written by “news” sources who should have known better. Stolen coins…uh, I don’t think so. Special presentation piece made to commemorate the death of President Lincoln…? Nope.

Wrong information aside, the coins provided the gold coin market was the type of exposure you’d have to spend millions of dollars to generate. It was a true viral buzz and any coin story that doesn’t involve a Long Island telemarketer swindling a little old lady for her life savings is a good story in my book.

2. I’ve known Don Kagin for a long time (he tried to hire me a billion years ago when I was a high school student) and I was glad to see this deal being handled by a firm that is both reputable and knowledgeable.

Often times, deals like this wind up with the wrong people. This time it didn’t.

David McCarthy, the senior numismatist at Kagin’s, is a close friend of mine and he deserves kudos for a host of reasons: treating the owners fairly, properly conserving the coins, making savvy marketing decisions, and just generally doing the right thing. David is one of the good guys in the business and I am really happy for him and his 15+++ minutes of fame. And damn if he didn’t clean up nicely for TV. (Sadly the Good Morning America clip is not currently available online, but CoinWeek has a nice short piece on YouTube.)

3. When I first read that much of the deal was going to be sold online at Amazon.com my first reaction was “wow, that’s ballsy.” My next reaction was “wow, that’s incredibly smart.”

Amazon.com has flirted with entering the coin market before, but for a number of reasons they couldn’t find the best way to enter the market. So why not enter the market with a deal worth millions of dollars and with scads of good publicity?

But this deal could really be win-win for the owners and for Amazon. With all the publicity these coins have garnered, they are clearly worth a premium. Who better to possibly reach the ultimate audience of non-collectors who might be willing to pay the sort of premium which might (or might not) seem too high to dyed-in-the-wool collectors than a company who gets more traffic every minute than I probably do in a month? Well, you might say, the traffic you get is more established and (most) everyone on the raregoldcoins.com site is a likely buyer. But as the owners of the coins - wouldn't you rather have them exposed to millions and millions of people worldwide than an audience of a few thousand established collectors? And if doesn’t work on Amazon? The coins are still great and still can be sold through more established numismatic channels. If Amazon does well and becomes a player in the coin market, it’s great for everyone. If it doesn’t work? No harm, no foul…

4. As the World’s Most Jaded Coin Dealer (OK, maybe not the most jaded but certainly in medal contention) it takes a lot to get me excited.

When I heard that the coins were going to be on display at the Atlanta show I was skeptical. Would they be bright, shiny, and obviously conserved? Would PCGS get carried away with the grading ? Would the coins themselves mostly be common date double eagles in slightly uncommon grades?

The 50 or so coins that were on display at the show were impressive to say the least. Many were the best examples of their specific issue that I have ever seen, and they look fresh and original; not overly conserved. I think PCGS did a nice job grading them and I really liked the special gold labels which PCGS prepared for the coins. I arrived expecting to be unimpressed and left impressed. And my guess is that most collectors are going to feel the same; at least with the top 10-20% of the coins in the hoard; I can’t speak for the remaining examples.

5. How will the Saddle Ridge coins affect the market?

Ah…the $10 million dollar question. Since the majority of the coins were Type Two and Type Three double eagles from San Francisco, the scope of the hoard is narrow and series specific.  I haven’t seen a list of all the coins, but I assume that the majority of them are dated in the mid to late 1870’s and the 1880’s. One area that will be greatly impacted are slightly better date SF Type Threes, like an 1887-S or an 1888-S. If there are 100 MS63 1887-S double eagles, this date could drop in value by 20-50% . And the biggest loser is likely to be the guy who owns the current finest known 1877-S or 1879-S (to pick two random dates) who might see his $50,000+ population one/none better coin become a population two/one better coin.

The Condition Census and Finest Known coins could easily be absorbed by the market as long as they are fairly priced. From some of the preliminary numbers I’ve seen thrown around (such as “a million dollars” for the new finest known 1866-S No Motto) it feels that the asking prices might be extremely aggressive. If the coins are priced “right,” they will sell easily. My guess is that these are not the coins that will be sold on Amazon and will, instead, be offered via private treaty by Kagin’s and/or other specialist dealers or via auction.

The market for San Francisco gold coins has heated up in recent years after near-permanent dormancy. The Saddle Ridge hoard can only do good things to this area of the market. Will it make an 1859-S half eagle in AU50 more valuable? Not directly, but it will focus more attention on SF gold and it is likely that a few deep-pocketed new collectors who buy a Saddle Ridge knick-knack will be compelled to focus on other gold coins from this mint. The Type One double eagle market back in the 1990’s was jumpstarted by the availability of the SS Central America 1857-S double eagles and this market has been in hyper-demand ever since.

6. What sort of premium are these coins worth?

My gut feeling is that a less expensive (sub-$5,000) SF Type Three double eagle in average Uncirculated grades is going to have an ultimate premium of 10-30% for its saddle Ridge provenance. I would assume the original premium will be much higher and, as with the SSCA double eagles, it will evaporate over the first few years only to come back as the coins are absorbed. The numismatically significant five figure coins probably won’t be accorded a big premium.  The finest known 1877-S double eagle is a valuable, desirable coin but it won’t be worth an extra $5,000 or $10,000 because it is from this hoard.

One thing that will be interesting to see is how the collectors who focus on shipwreck coins view this hoard. As an example, “unique” coins from the S.S. Central America (i.e., coins which were one of a kind from the shipwreck) now bring a huge premium due to their collectability; something which was not the case even six or eight years ago. What sort of premium will the only Dahlonega half eagle from this hoard be accorded?  My guess is that the premium will be quite significant, and that these coins will be collected alongside the S.S.Central America, Brother Jonathan and S.S. Republic shipwreck coins.

The Saddle Ridge Hoard is certainly a topic which could be discussed endlessly, and I have the feeling that this is not the last time you will read a DWN Blog on the subject. I look forward to your comments and, hopefully, to selling a few of the neater coins from this group later in the year.

Do you buy rare gold coins?

Do you have coins to sell?

Would you like to have the world’s leading expert with you assembling a set of coins?

Contact me, Doug Winter, directly at (214) 675-9897 or by email at dwn@ont.com.

Can Coin Dealers be Coin Collectors?

A recent question from a client got me thinking: is it possible for a coin dealer to be a coin collector? My answer short and sweet: certainly yes — but with a large asterisk.

In most collectibles fields, many of the greatest collections ever formed were by dealers. This is especially true in the art world where the line between what is a “collection” and what is “inventory” is blurry; certainly far more so than in the world of coins.

Focusing on coins, I’d say that you want to buy from someone who is a coin weenie; someone who loves coins every bit as much as you do. I know I admire those dealers who really love coins more than those for whom numismatics is just a business, and who don’t really care that one 1845-O quarter eagle is choice and original while another is abraded and processed.

In the 19^th and early 20^th century, many of the most prominent U.S. dealers were collectors as well. Lyman Low, John Haseltine, David Proskey, Ed. Frossard, M.H. Bolender, Al Overton, and others assembled great specialized collections which were sold during their lifetimes and for which they are remembered even today.

Numismatics has evolved from an esoteric hobby into a big multi-national business since World War II, and for every post-war dealer like John Ford or David Akers who owned great coins, there are dealers who either do not care to collect or who do not want to be placed in a position where they are competing with their clients.

Let me give you an example. I recently bought a beautiful PCGS AU58 1846-O half eagle. This is exactly the type of coin I’d put away if I were a collector. So here was my predicament: do I keep the coin or sell it to any one of the dozen or so collectors who I work with on Liberty Head half eagle or New Orleans gold collections? I agonized for a second or two and quickly decided to sell the coin to a good collector. It was a simple; I’m a coin dealer not a coin collector. And here is another conundrum: if I were putting together a set of Liberty Head half eagles and I needed an 1846-O, why would I sell such a coin as perfect as the aforementioned example to a “competitor?”

But I still want to collect, and I’m not going to be relegated to something totally out of numismatics in order to escape potential conflicts of interest. My solution is pretty simple: I collect paper money, coin books, cool numismatic knick-knacks, and silver coins that do not typically appear in my inventory. Once or twice a year I do buy a gold coin for myself that is so unusual (from the standpoint of appearance) or so undervalued that I put it away. Such coins usually stay in my safe deposit box for a year or two until I have a client who I feel will appreciate the coin (and will sell it back to me when he tires of it) or if the market has risen enough to motivate me to take my profit (in the case of a Civil War eagle I recently sold).

So that’s my answer. A coin dealer should be a coin collector, just not in the area in which he specializes. Your thoughts?

Do you buy rare gold coins?

Do you have coins to sell?

Would you like to have the world’s leading expert with you assembling a set of coins?

Contact me, Doug Winter, directly at (214) 675-9897 or by email at dwn@ont.com.

Some FUN-based Market Observations

The FUN show is clearly one of the two major market indicators. Symbolically, it is the beginning of a New Coin Year but it is, most of all, a huge economic event with hundreds of millions of dollars changing hands. For me, a good FUN show is a clear indicator that the first quarter—if not half—of the coin year will be strong.

This was one of the strangest FUN shows I can recall. I was constantly busy and there were people at my table from the beginning of dealer set-up on Wednesday until I was packing up to go home on Friday afternoon. It was one of the easiest selling shows I can ever recall having, and my wholesale numbers were well above average. But it was also a hugely difficult show at which to buy. If, like me, you were a dealer who buys choice, cool, rare coins there were slim pickings at best. I was able to buy a number of great coins (some of which are now posted on my website; others never made it back from Orlando) but I knew as early as Thursday morning that I was going to fall well short of my numeric goals in terms of coins bought.

Clearly, one of the facts of life about major coin shows (FUN and ANA in particular) is that the huge auctions that surround them have a profound and significant impact. I talked to numerous well-heeled collectors who roamed the floor but stated that they were “waiting until after the auction” to make purchasing decisions. Considering that the major segment of the auction was Thursday night, this left a short window of opportunity for them to buy coins.

Heritage should be credited for producing one of the all-time great FUN auctions, and although I don’t know exactly what their final numbers were, I am assuming the FUN sale set an all-time record, given that Platinum Night alone did north of $50 million dollars.

I spent a lot of money at the Heritage auction(s) but didn’t buy a lot of coins; at least not in terms of useful, “bread and butter” coins that I could turn around and immediately place into inventory. Some of the dates that I will always try to purchase were represented by coins I just didn’t like, while other areas of the market seem to have quickly jumped to new levels with which I’m not yet comfortable.

Some observations from the auction are in order:

1. Rarity is clearly in vogue right now and even off-quality examples of truly rare issues are commanding huge premiums. As an example, an NGC EF45 1864-S brought just a shade under $100,000. And other seldom-seen eagles such as the 1863, 1873, and 1876 brought what I thought were enormous prices based on their actual quality.
2. There were a number of really exceptional coins in the auction and they brought exceptional prices, as they should have. My two personal favorites were David Akers’ personal 1826 half eagle graded MS66 by PCGS which brought $763,750 (a price which I thought was strong but not at all outrageous), and the Eliasberg Proof 1889 double eagle, graded PR65 by PCGS but in an old green holder and looking more like a PR67 Deep Cameo by today’s standards, which sold for an extremely strong $352,500.
3. Speaking of exceptional, the market for Liberty Head double eagles continues to rage on. The FUN sale had a deep offering with coins ranging from off-quality and very choice for the grade and issue. But it almost didn’t matter what the coin looked like as prices were strong across the board. Type One O mints? Very strong. CC’s? Very strong, although the nice PCGS AU50 1870-CC at $329,000 seemed like a much better value than the really unappealing PCGS EF45 at $282,000. Civil War dates? Crazy strong including a record-for-the-grade prices on the 1861-S in PCGS MS62, the 1863 in PCGS AU58, and the PCGS MS62 1864. I was taken aback by prices for the Big Five late date Type Three issues. An 1881 in PCGS AU58 sold for $111,625, an 1882 in NGC AU58 realized $94,000 and perhaps most incredibly, a tooled no grade 1886—the ultimate “what a shame” coin—brought a staggering $129,250. No grades in general did very well in this sale, by the way, but that’s another story.
4. The best values in the 19^th century series are clearly in the Liberty Head half eagle series. Prices on double eagles have made this series the playground of the 1%, and the eagle series has gone from neglected to flavor of the year (smart buys still can be made in this series but proceed with caution!). Even though there were some price records set in the FUN sale for finally-recognized date rarities such as the 1863 and 1865, there are still many dates in the $2,500-15,000 range which seem very fairly priced relative to their rarity. Given the great prices that schlocky rare date coins brought in the auction, I’d like to think that DWN-quality examples are even better values.

A few other non-auction observations, based on looking at dealer’s inventories: nice quality early gold is still in very short supply, Dahlonega gold is literally nowhere to be seen (I’m embarrassed to admit this but I came home with exactly two new D mint coins…two! From the FUN show!!! How is this possible?!?), CAC premiums are really noticeable - especially from sellers who don’t typically handle nice coins, and if I had listened to myself and bought Civil War gold coins when I predicted they’d be the Next Big Thing I’d have made myself a tidy little profit.

Do you buy rare gold coins?

Do you have coins to sell?

Would you like to have the world's leading expert with you assembling a set of coins?

Contact Doug Winter at (214) 675-9897 or by email at dwn@ont.com.

Some Thoughts on Rarity

Having just published a blog about coin rarity based on grade distribution, I’ve been thinking more about the many concepts of rarity and how they apply to coin collecting. Let’s take a look at a few and discuss them. Rarity is probably one of the two or three most misused terms in all of numismatics, especially from the selling side. I consistently see coins referred to as “rare” which most definitely are not.

Collectors need to remember that rarity is a relative concept. A coin like an 1895 Morgan Dollar is always termed a “rare” coin. Within the context of the Morgan Dollar series, it is rare. But one needs to remember that there are hundreds of examples known in grades up to and including PR67 and, if compared to a coin like an 1867-S quarter eagle (which is priced at a tiny fraction of the 1895 dollar) it is common. What always needs to be remembered when analyzing rarity is context. There are, in theory, hundreds if not thousands of serious Morgan dollar collectors and this makes a coin like an 1895 contextually rare. On the other hand, there are probably less than two to three dozen serious collectors of Liberty Head quarter eagles and an issue like an 1867-S exists in enough quantity that anyone who wants a decent example should be able to find one. In other words, there are basically enough to go around; at least for now.

Rarity is both relative and series specific. It is difficult to compare absolute rarity from one series to another. As I mentioned above, a coin with 20 known in all grades can be a great rarity in a popular series, or it can be a “sleeper” if it is in a series which has the potential of being more intensely collected in the future. There are also numerous esoteric coins that have 20 known but the number of collectors is so few that 20 coins is the equivalent to hundreds of pieces known in a more popular series.

There are essentially two types of rarity. The first is overall rarity. This refers to a coin which is rare in all grades and whose rarity is not solely predicated on its grade. A coin which is rare in all grades is also called fundamentally rare.  As a dealer, these are the types of coins I like to buy and what I specialize in.

A coin can be fundamentally rare for a number of reasons. A Proof 1878 gold dollar is fundamentally rare because of its original mintage figure (a scant 20 coins). An 1828/7 half eagle is fundamentally rare because virtually every known example was melted in 1834 when the weight was changed for gold coins and old tenor half eagles were worth more than face value. An 1865 half eagle is rare not only because of a low original mintage figure (1,270 business strikes) but because of the fact that it is a well-used Civil War issue that not only saw active use in circulation was later melted.

In the area of branch mint gold, few issues are fundamentally rare. Most exist in quantities of 150-200 in all grades. But nearly all branch mint coins are grade rarities.

In nearly all series of American coins, grade rarity has become more significant to collectors than condition rarity. An 1843-D half eagle in Very Fine is a relatively available coin and within the context of Dahlonega issues it is common. But this same date in, say, Mint State-63 is very rare and it is described as a grade rarity.

But the real grade rarities in American numismatics tend to be in 20th century series. An average quality MS64 1912 St. Gaudens double eagle is worth around $5,000 in MS64 and $25,000 or more in properly graded MS65. The disparity can be far, far greater with coins from the 1940’s, 1950’s and 1960’s. As an example (and I selected this totally randomly) a 1942-S quarter is worth $300 in PCGS MS66, $2,500 in PCGS MS67 and close to $20,000—maybe more—in PCGS MS68. That’s a big difference in quality for a difference in appearance that might not be readily recognizable to more than a handful of dealers and specialized collectors.

The difference between the 1843-D half eagle and the 1942-S quarter is that the former has a reasonably significant degree of value in all grades. Even a cleaned, no-grade 1843-D is worth around $1,000; an average quality circulated 1942-S might not fetch six bucks at your local coin shop.

To my way of thinking the “best” coins are what I call dual rarities. This is a coin that is not only rare from an overall standpoint (i.e., it might have a total number known of 40-50) and it is among the best known for that particular issue. Going back to a  coin I mentioned earlier in this blog, the 1865 half eagle, a nice AU55 example would be a dual rarity as it would be among the finest known examples of a coin which is rare in all grades.

The newest category of rarity, one that dates from the 1970’s but which is probably at its height right now, is what I refer to as appearance rarity. Appearance rarity can be related to strike (Full Bands for Mercury dimes, Full Head for Standing Liberty quarters) or it can be related to coloration (Red and Brown or Red for Lincoln Cents). The newest categories of appearance rarity relate to the actual finish of a Proof coin (Deep Cameo/Ultra Cameo) or for business strikes (Prooflike or Deep Mirror Prooflike).

I have mixed feelings about appearance rarity. If I was collecting Lincoln Cents by date, would I spend $100,000+ for a PCGS Red MS65 1926-S or $5,000+ for a mostly red MS65 Red and Brown? Easy answer for me (without a doubt I’m in for the Red and Brown coin) but, then again, I’m a fundamental rarity guy and not a condition rarity so the concepts of appearance rarity seems totally wacky to me. But there are instances I will and do pay a premium for appearance; an example would be a better date Type Three double eagle in MS63 designated as Deep Mirror Prooflike or a rare date Proof Liberty Head half eagle designated as Deep Cameo.

One of the oldest subcategories of rarity is also one of the hardest for the layman to figure. Certain series, like Large Cents and Capped Bust half dollars are avidly collected by die variety. There might not be more a few dozen very serious collectors in these two areas but they tend to be extremely passionate and often very well-heeled. For a non-specialist like me, I am often amazed at the huge prices certain early cents bring but I can appreciate them. My only caveat for a variety collector is to avoid paying premiums in series which are not avidly collected by die variety. You may collect Trade Dollars by variety but if you do you are one of probably ten or fewer collectors who do. Paying a large premium for a seemingly rare variety might not prove financially prudent down the road.

In closing, I’d like to quickly address a question which I am often asked by new collectors: how can you tell if a coin is truly rare? I think frequency of appearance at auction is an excellent guide.

• If a coin appears for sale at virtually all major sales, it is common. An example of this would be a 1901-S eagle in MS64.
• If a coin appears a few times a year at auction (say three or four times), it is at the very least scarce. An example of this would be an 1849-D half eagle in AU50.
• If a coin appears less than once per year at auction, it is rare. This is true from both an in-grade and overall rarity perspective.
• And if a coin appears at auction once every three to five years? That, in my opinion, is a coin which is very rare or even extremely rare.

Do you buy rare gold coins?

Do you have coins to sell?

Would you like to have the world’s leading expert with you assembling a set of coins?

Contact me, Doug Winter, directly at (214) 675-9897 or by email at dwn@ont.com.

Grade Distribution of Branch Mint Gold Coinage

It is interesting to study the grade distribution patterns for various branch mint gold issues. By this, I am referring to what percentage of a certain issue’s survivors exist in a specific grade range. In order to apply this to a practical numismatic situation, I am going to use the Dahlonega quarter eagle series as my lab experiment. Any assumption that I make in this blog is series specific.

By this, I mean that what applies to Dahlonega quarter eagles doesn’t apply to New Orleans half eagles or San Francisco eagles. And within the Dahlonega quarter eagle series there are differences; as an example the issues from the 1840’s are likely to have different grade distribution patterns than those from the 1850’s due to a number of factors. In the case of Dahlonega quarter eagles, the primary consideration is that of usage: these coins circulated differently in the 1840’s than they did in the 1850’s.

I think the best “base line” Dahlonega quarter eagle to use in our brief study is the 1843-D Small D. This is the most common date in this series both in terms of overall and high grade rarity. It has the highest mintage figure of any quarter eagle from this mint, and with over 500 examples known, it can be found in a variety of grades.

According to the most recent data from PCGS, there have been a total of 243 coins graded. This number, of course, is inflated by resubmissions, but it gives a good indication of the grade distribution for this issue. According to PCGS, the grade distribution is as follows:

• VF and lower: 58 coins (23.86%)
• EF: 77 coins (31.68%)
• AU: 97 coins (39.91%)
• Uncirculated: 11 coins (4.52%)

Before analyzing this, there are a few things to remember. First, there are probably more raw low grade 1843-D quarter eagles than there are high grade ones, meaning that the number at the low end of the grading scale could easily inflate if these were ever submitted. Secondly, the number of coins in very high grades (in this case AU58 and Mint State) is clearly inflated on account of the financial incentive to upgrade a coin. An upgrade from VF25 to VF30 is pretty meaningless, but an upgrade from AU55 to MS60 translates to a not inconsiderable amount of money. And lastly, the grade range that has seen the most gradeflation in the last decade is AU, meaning that a significant number of coins graded AU50 or even AU53 by PCGS would not necessarily qualify as such if broken out and submitted again.

Taking all of these caveats into consideration, this grade distribution makes sense to me. I expected at least 60-70% of all 1843-D quarter eagles to grade EF45 and below, and according to PCGS’s figures, the current percentage is 55.54%. If we were able to dismiss all the superfluous AU submissions included in the numbers above, and punt all the marginal AU50 coins that are actually EF’s, this figure might well be close to 70%.

I think that the actual number of 1843-D quarter eagles which grade AU is more likely in the 25-30% range; not all that far off from the 39.91% figure shown.

By any stretch of the imagination, Uncirculated 1843-D quarter eagles are rare. My best estimate is that 15-20 are known, and many are marginal MS60 to MS61 examples. In MS62 and MS63 there are likely no more than four to six and none finer.

The grade distribution for the 1843-D Small D quarter eagle is reasonably similar to that seen for the 1844-D, 1845-D, 1846-D, 1847-D, and 1848-D. These are six of the most available quarter eagles from this mint and they represent the Golden Age, if you will, of commercial use for this denomination in the antebellum south. Beginning in 1848, gold discoveries in California made the Dahlonega (and Charlotte) mint redundant, and by 1854, mintage figures of all C and D mint denominations except half eagles were cursory at best.

There is a Dahlonega quarter eagle whose grade distribution is complete different than the 1843-D; enough so to be a complete anomaly within the series. This is the 1857-D; let’s look at the PCGS figures.

A total of 70 1857-D quarter eagles have been graded by PCGS. The by-grade breakdown is as follows:

• VF and lower: 4 coins (5.71%)
• EF: 6 coins (8.57%)
• AU: 45 coins (64.28%)
• Uncirculated: 15 coins (21.42%)

The 1857-D is the second to last quarter eagle from this mint with an original mintage of only 2,364 with an estimated 125-150 known. As long as I have specialized in Dahlonega coins, I’ve noted that the 1857-D is almost never seen in VF or EF grades, and most of the survivors are in the AU53 to AU58 range.

What is most interesting about this date is that so many of the survivors have a similar look. The typical example in AU55 to AU58 has an “Unc-ish” appearance with many of the hallmarks of a Mint State coin but with either light friction or soft hairlines suggestive or a gentle old cleaning. And, on most of the high grade coins, the color and quality of luster are similar.

These facts combined with the PCGS grade distribution lead me to believe that the 1857-D is a hoard coin. I can’t prove this—and even if it is true I know nothing specific about the so-called hoard. But the fact that 85% of all 1857-D quarter eagles graded by PCGS are AU or Uncirculated is interesting and is completely different in pattern than for any other date in this series.

There is one final Dahlonega quarter eagle with a grade distribution pattern which varies from the norm but for a different reason: the 1856-D.

The 1856-D is not only the rarest quarter eagle from this mint; it is the rarest single issue of any denomination. Only 874 were struck and around 45-55 are known in all grades.

The distribution by grade is very interesting; let’s take a quick peek at how the PCGS has graded the 35 they have recorded:

• VF and lower: 5 (14.28%)
• EF: 8 (22.85%)
• AU: 21 (60%)
• Uncirculated: 1 (2.85%)

There are many interesting things about these numbers, but two points need to be mentioned first. The 1856-D is an extremely poorly produced coin which is exceptionally hard to grade. I have seen 1856-D quarter eagles which could be graded VF30 just as easily as they could be graded AU50. It is also important to remember that as a rarity within the series, PCGS (and NGC as well) tend to push the grade on the 1856-D quarter eagle. Because it is such a rare coin, a nice EF45 example is typically graded AU50 or AU53 with little complaint from specialists.

I think the PCGS grade distribution for the 1856-D is skewed way too far towards AU and I very, very seriously doubt if “60%” of all known examples grade AU50 to AU58. But given the difficulty of grading this issue, I can understand how this is the case.

As I mentioned at the beginning of this blog, the grade distribution for each series depends on a number of factors. Age and the original mintage figure are obvious and important, but there are less subtle factors at play such as perceived rarity, appearance of the coin, whether or not a hoard exist(ed), and if examples were expatriated to Europe and are now returning to the American market.

Do you buy rare gold coins?

Do you have coins to sell?

Would you like to have the world’s leading expert with you assembling a set of coins?

Contact Doug Winter at (214) 675-9897 or by email at dwn@ont.com.

The 1863 Eagle: An Unheralded Rarity

One of my favorite American coins is the 1863 eagle. I had a lovely NGC EF45 pass through my hands recently and it inspired me to write a blog about what I think is one of the absolute rarest Liberty Head eagles. Production of this issue was limited to a scant 1,218 business strikes, and I rate the 1863 as the third rarest Liberty Head eagle after the 1875 and the 1864-S. There are probably fewer than 30 known in all grades, with most in the EF40 to AU50 range. There are very likely as few as six or seven known in AU grades and two in Uncirculated; more about these a little further down the page.

A quick search of auction records shows that no problem-free 1863 eagles have sold since October 2010, and only seven records exist for problem-free coins in the last decade. My records show that I have handled exactly two pieces in the last five years: an NGC EF45 and a PCGS AU53.

When available, the 1863 tends to be bright from having been cleaned or dipped and it is invariably very heavily abraded. This piece shown above is one of the very few circulated pieces that I have seen with natural color. There are a few small abrasions on the surfaces, but they are much cleaner than usual.

There are two high-grade 1863 eagles known. The finest is the Bass IV: 683 coin which sold for $52,900 in 2000; a price which, at the time, I thought represented possibly the single biggest bargain all of the three Bass sales which featured gold coins. Bass had, through an agent, bought this exact coin in August 1991 for $104,500. Harry didn't lose money on many coins but he got spanked — and good — on this one; all the more remarkable considering that it is the finest known example of a truly rare issue and it is exceptional for the grade. Today, it would bring considerably more than in either of its previous auction appearances.

The other Uncirculated 1863 eagle is an MS62 that was found as part of the S.S. Republic treasure. I have never personally seen this coin, but it is in the collection of a western specialist along with many other finest known or Condition Census pieces from this shipwreck.

Civil War gold coins have been very popular in recent years as a result of the sesquicentennial of the war plus promotions/popularization by dealers such as myself. While it is not well-known outside of the specialist community, it is my belief that there are currently many collectors who would appreciate a nice 1863 eagle in their holdings.

Do you buy rare gold coins?

Do you have coins to sell?

Would you like to have the world's leading expert with you assembling a set of coins?

Contact Doug Winter at (214) 675-9897 or by email at dwn@ont.com.