Making Friends With Your Coin Dealer

Most high quality specialized collections are built with strong cooperation between a collector and one or two dealers that form a close, mutually beneficial relationship. What can you as a collector do to earn the trust of a dealer who will be critical in the success of assembling the sort of collection you aspire to form? How do you become the sort of collector that dealers like to do business with? If you look at the roster of great collectors over the course of the past century you will find a number of common traits: they were keen students of numismatics, they had strong financial resources, they were not afraid to "step out" when purchasing important coins and they had intelligent numismatic advisors who were regarded as allies and not adversaries.

In today's numismatic world, too many dealer/collector relationships are based on distrust. While there are certainly dealers who cannot be trusted, there are many specialized dealers who are extremely trustworthy and whose counsel should be eagerly sought by collectors.

Here are some suggestions on behaviors to avoid:

1. Don't Expect Continual Freebies: Imagine what a doctor's reaction would be if you called him up a few times and asked for a free diagnosis. A coin dealer will feel the same way if you call him repeatedly asking for information but never buy from him. By the same token, most dealers will be very happy to provide all sort of free services to good clients. I will sometimes make "courtesy purchases" from dealers who are good guys and who provide me with information that I find helpful. I am also happy to perform a number of free services for good clients including upgrading coins, looking at auction lots, sending detailed write-ups on coins and helping to establish credit with other dealers or auction firms.

2. Don't Be A "Know It All": I greatly respect collectors who admit their shortcomings. Admitting that you do not know everything is, in my opinion, far preferable to pretending that you do. I am a professional numismatist who has intently studied the coin market for over twenty years. I should know more about it than my clients, just like they know more than I do about what they do for a living. Most dealers are pretty adept at spotting a "faker" and it is hard to shed this label once it has been applied to you.

3. Be Accessible: If you are impossible to get in touch with, a dealer is not likely to make an effort to offer you coins. Let a trusted dealer know your "secret" cell phone number or whether you prefer to be called at work or at home.

4. Pay Promptly: Unless you make prior arrangements, send payment on the coins you buy within a few days. Slow payers get a bad reputation and tend to be forgotten when interesting new coins become available. It is very important for a medium to large-sized coin dealer to have good cash flow. If you slow up this cash flow, you make the dealer unhappy. Pay promptly and the dealer is happy.

5. Be Loyal (if the dealer has earned loyalty): There are certain collectors who are known in the business as being price shoppers. They will buy from whoever has the least expensive example of what they are searching for. Most dealers greatly respect loyalty and will reciprocate. A customer who has no sense of loyalty with any dealer will wind-up purchasing lots of low-quality, cheaply priced coins.

In the same vein, do not give your want list to every major dealer in the country. When I learn that a want list I receive is also in the hands of ten other dealers (and I will generally figure this out in a few days since I'll get phone calls from the same dealers looking for coins on the list!) I become much less interested than if the list is "fresh."

6. Let the dealer make a fair profit: In an ideal dealer/collector relationship, there will be as much disclosure as possible. In many cases, I'll tell a collector where I bought a coin, what I paid for, what I am pricing the coin at to dealers and what I have bought and sold other comparable examples. Most collectors will let me make 10-20% on coins that I have assumed all of the risk on and 5-10% on coins that I have assumed no risk on.

Some collectors just can't help themselves and will try and negotiate a reduction in price even after a deal has been struck. Don't get in the habit of taking "shots" at a dealer.

7. Decide whether you are a collector or a dealer: The Internet has created a new hybrid in the numismatic world: the collector who is simultaneously a dealer. If you are a collector, you are "entitled" to certain services which a dealer does not receive. These cost more money but provide a safety net. If you want to act like a dealer, than understand that you have to make quick decisions (see below) and you have little recourse for returning a coin after you've bought it.

8. Make Quick Decisions: No dealer expects a collector to make an immediate decision on any coin, especially one that is expensive. But it is very inconvenient when a collector ties up a coin for a week agonizing over a decision. Let the dealer know up front if it will take a while to make a decision. And if the dealer asks you not to show the coin to other dealers or ask for second (or third) opinions, don't blatantly do this anyway.

9. Understand The Dealer's Terms: Know in advance what a dealer's return policies are. Don't expect to be able to return a coin for a full refund after a month if the return policy of the dealer is stated as ten days. If a coin is purchased on a sight-unseen basis (a bad idea, in my opinion...) than the collector should understand that he has no return privilege.

In my two decades in the rare coin business, I have been very fortunate to meet a number of really nice collectors. Many of these people have become good friends of mine who I see on a social basis. They know that they are being represented in their numismatic transaction by someone who genuinely cares about their best interests. I know that their word is their bond. And that's what I am looking for in a customer: an honest, sincere person who will treat me with as much respect as I will treat him.

Collecting Three Dollar Gold Pieces

Three Dollar gold pieces were produced from 1854 to 1889. This relatively short-lived type contains a number of very rare issues but is surprisingly collectible as well. While forming a complete set will exceed the budget of most people, there are a number of ways to actively purchase these popular odd denomination issues. Before examining some of the interesting "subsets" within the Three Dollar gold piece denomination, a bit of background information is in order. The origin of this issue is shrouded in controversy. It is generally believed that the Three Dollar gold piece was adopted as a direct result of the postal rate dropping from five cents to three cents in 1851. A three dollar gold issue allowed purchasers to buy large quantities of the new stamps without having to use the then-unpopular copper Large Cents or the new, tiny silver Three Cent pieces.

The Three dollar gold piece was designed by James Longacre. It features an Indian Princess on the obverse and a wreath of corn and cotton on the reverse which surrounds the date, denomination and, when appropriate, the mintmark.

Three dollar gold pieces were struck at four mints: Philadelphia, San Francisco, New Orleans and Dahlonega. There are two major types: the small letters reverse which was made only in 1854 and the large letters which was produced from 1855 until the denomination was abolished in 1889. In both cases the size of the lettering refers to the word DOLLARS.

This was not a popular denomination when it was struck and mintages were, for the most part, extremely limited. Only one date, the 1854, had a mintage figure greater than 100,000 and only four more exceeded 25,000. There are seven issues that had original mintages of fewer than 1,000.

As mentioned above, this is an essentially impossible denomination to complete. The 1870-S is unique (it is in the Bass collection and is currently on display at the ANA museum in Colorado Springs) while the 1875 and 1876 were produced in very limited quantities and only as Proofs.

Here are some suggestions on how to collect some Three Dollar gold pieces without "breaking the bank" and with the satisfaction of knowing that completion is possible.

The Two Coin Type Set

As mentioned above, there are two naked-eye types of Three Dollar gold piece. Many collectors like to assemble a basic type set that contains one of each. The first type was made only in 1854 but, fortunately, this is a common date that is easily obtainable in any grade up to and including Mint State-64. For their second coin most collectors select an 1874 or an 1878. Both are easy to find in nearly any grade and are affordable as well.

For $4,000-6,000, a collector can assemble a very nice two coin type set with both pieces grading Mint State-62 to Mint State-63.

The Four Coin Mint Set

This is a challenging and interesting set. The easiest issue to obtain is one from Philadelphia. Most collectors will select a common date such as an 1854, 1874 or 1878. The New Orleans mint produced this denomination only in 1854. The 1854-O is quite common (and very affordable) in lower grades but it becomes quite scarce in the higher About Uncirculated grades and it is extremely rare in Uncirculated. The 1854-D is another one-year type issue. Only 1,120 were struck and it is exceptionally popular. This is an issue that is a bit more available than its low mintage would suggest but it is expensive due to great demand. The collector should expect to pay at least $15,000-20,000+ for a nice 1854-D. The San Francisco mint produced Three Dollar gold pieces in 1855, 1856, 1857, 1860 and 1870. The 1856-S is the most available of these but it is very hard to find in high grades. The other dates are extremely rare in AU-55 or better.

The collector can expect to spend at least $30,000-35,000 for a nice four coin mint set of Three Dollar gold pieces. This figure could easily double (or triple) if the collector pursues higher grade examples.

The Six Coin Branch Mint Set

Not including the unique 1870-S, there are a total of six branch mint Three Dollar gold pieces: four from San Francisco and one each from New Orleans and Dahlonega. This is an extremely interesting set to collect. None of these issues is impossible to locate but all are generally seen in lower grades.

A six coin branch mint set that included coins in the Extremely Fine grade range would cost $30,000 or so. A set that included nice About Uncirculated coins would cost at least $60,000-70,000. A set that had all of the coins in Uncirculated would be a remarkable accomplishment and one that required considerable patience. It would require a commitment of at least $150,000-200,000.

The Low Mintage Set

In this era of billion+ mintage figures, it is amazing to look at the original mintages of most Three Dollar gold pieces. As mentioned above, seven had mintages of below 1,000 while another nine had mintages that were less than 2,500. Despite the low mintage figures of these issues, many are surprisingly affordable. As an example, a nice About Uncirculated 1885 (original mintage figure: 910) typically trades in the $2,000-4,000 range.

In my opinion, these low mintage coins are extremely undervalued and represent excellent value. The dates that I feel offer especially good value include 1877 (1,488 struck), 1881 (534 struck), 1883 (989 struck) and 1885 (910 struck).

The Five Coin Civil War Set

Civil War-related issues are extremely popular in all areas of American numismatics. The five Three Dollar gold pieces struck during the Civil War years are low mintage coins. The rarest of these is the 1865. The 1861 through 1864 are all reasonably available and are moderately priced in About Uncirculated grades.

A five coin Civil War set would be hard to assemble in Extremely Fine grades as some of these dates are not often seen with this amount of wear. A nice About Uncirculated set would cost $12,500-17,500. Depending on quality, an Uncirculated set would cost $25,000 to $100,000+.

The value spreads between, say, About Uncirculated-55 and Mint State-61 Three Dollar gold pieces is not as pronounced as on comparable Liberty Head gold issues. The collector should carefully study price levels in Coin World Trends and CDN Quarterly to determine which issues are undervalued in high grades.

"Generic" common date high grade Three Dollar gold pieces are currently very reasonably priced compared to previous market highs. As of November 2002, common date Three Dollar gold pieces in Mint State-64 are worth $4,500-5,000 while Mint State-65 coins are worth $7,000-8,000+.

A good source for determining price levels for the rarer issues is auction records. It is a good idea for the collector to maintain a database of pertinent sales.

Many of the low mintage issues are found with highly reflective prooflike fields. This tends to enhance abrasions or hairlines. Any Three Dollar gold piece that is prooflike with clean, choice surfaces is worth a strong premium over a typical heavily abraded example.

PCGS and NGC population figures for most rare date and/or high grade Three Dollar gold pieces are inflated by resubmissions. A better test of rarity for rare date (or high grade) coins is the number of appearances at auction of a five year period.

Assembling a New Orleans Gold Coin Type Set

Due to the various denominations and designs struck at the New Orleans mint, assembling a type set of gold coins from this facility is extremely popular with collectors. This mode of collecting makes even more sense when realizes the difficulty and expense of acquiring New Orleans gold coins on a date-by-date basis. Gold coins were struck at the New Orleans mint from 1839 until 1909. Six different denominations were produced: gold dollar, quarter eagle, three dollar, half eagle, eagle and double eagle. There were a total of twelve major types produced, and these are as follows:

Type One gold dollar, 1849-1853

Type Two gold dollar, 1855 only

Classic Head quarter eagle, 1839 only

Liberty Head quarter eagle, 1840-1857

Three Dollar gold piece, 1854 only

Liberty Head half eagle, no motto reverse, 1840-1857

Liberty Head half eagle, with motto reverse, 1892-1894

Indian Head half eagle, 1909 only

Liberty Head eagle, no motto reverse, 1841-1860

Liberty Head eagle, with motto reverse, 1879-1906

Type One Liberty Head double eagle, 1850-1861

Type Three Liberty Head double eagle, 1879 only

There are a number of reasons why collecting New Orleans gold coins by type purposes is sensible for most collectors.

Affordability: High grade examples of these types can be obtained, in many cases, for $5,000-10,000. This means that a very nice twelve coin type set can be assembled for less than $100,000.

Variety: Since each major type of New Orleans gold coin has a significantly different appearance, the collector can assemble a set that is richly varied.

Distinctiveness: Five of the twelve New Orleans gold coins mentioned above are distinct one-year types, meaning that they were produced only in a single year. This adds quite a bit of historic interest to a New Orleans type set.

Completeability: None of these twelve types is so rare or expensive that the collector of average means cannot put a nice example into his or her set. With a date set, there are always issues that are so hard to obtain that they are "stoppers" for many collectors.

A brief discussion of each of the twelve major types of New Orleans gold coins should prove useful for new collectors.

1. Type One Gold Dollar: The gold dollar denomination was introduced in 1849. The first major type was produced from 1849 until 1854 and it has a small liberty head on the obverse. New Orleans produced Type One gold dollars for five years. The 1850-O is by far the scarcest of these issues but a very nice example can be purchased for under $5,000. Mint State-63 to Mint State-64 examples of the other dates (except the 1852-O) can be had for $3,000-7,000. I personally like the 1849-O as a type coin since it is a first-year-of-issue.

2. Type Two Gold Dollar: This is a one-year type that was produced only in 1855. It is relatively common in circulated grades but it is rare in the lower Uncirculated grades and very rare in Mint State-63 or better. It is extremely hard to locate a nice piece that is well struck and has original color and surfaces. For most collectors, an example in the Mint State-60 to Mint State-62 range will suffice and such a coin is valued in the $5,000 to 10,000+ range.

3. Classic Head Quarter Eagle: The Classic Head New Orleans quarter eagle of 1839 is similar in rarity and historic profile to the 1855-O gold dollar. The 1839-O quarter eagle is a popular one-year design type that is not really rare in circulated grades and can sometimes be found in the lower range of Uncirculated. It becomes rare in Mint State-62 and is very rare in Mint State-63 or better. A nice Mint State-60 to Mint State-62 is valued in the $5,000-10,000 range.

4. Liberty Head Quarter Eagle: A total of fourteen different quarter eagle issues were struck at the New Orleans mint between 1840 and 1857. This includes a Small Date and Large Date variety in 1843. The most common issues in higher grades are the 1843-O Small Date, 1854-O and 1857-O while the rarest are the 1840-O, 1842-O and the 1845-O. I would suggest that the type collector seek a coin like an 1843-O Small Date or an 1854-O in Mint State-62 for his set. When available, such a piece sells for $2,500-3,500 and is very good value.

5. Three Dollar Gold Piece: This is the third one-year type in the New Orleans set. It was produced only in 1854. The 1854-O three dollar gold piece is common in Very Fine and Extremely Fine and only slightly scarce in the lower About Uncirculated grades. It becomes very scarce in About Uncirculated-55 to About Uncirculated-58 and it is extremely rare in Uncirculated. A Mint State-60 to Mint State-61 coin, if available, will cost in the area of $20,000 and will prove to be among the most difficult pieces for the type collector to acquire. Nice About Uncirculated-55 to About Uncirculated-58 pieces range from $5,000 to $10,000+.

6. No Motto Liberty Head Half Eagle: Thirteen No Motto half eagles were struck between 1840 and 1857. This includes Large Letters and Small Letters varieties from 1843. The two most common dates are the 1844-O and the 1854-O while the rarest are the 1842-O and the 1847-O. All No Motto half eagles from this mint are scarce in Mint State-60 to Mint State-62 and all are very rare in Mint State-63 or better. An 1844-O in Mint State-60 to Mint State-62 would be a perfect type coin and would cost between $4,000 and $7,500. The only other issue that is sometimes seen in Uncirculated is the 1854-O.

7. With Motto Liberty Head Half Eagle: This type was produced for just three years: 1892, 1893 and 1894. The rarest of these is the 1892-O while the most common is the 1893-O. For type purposes, most collectors look for either an 1893-O or an 1894-O. Both are common in all circulated grades and modestly scarce in Mint State-60 to Mint State-62. They are very rare in Mint State-63 and excessively rare above this. A nice Mint State-62 example of the 1893-O or 1894-O half eagle is currently very good value in the $2,000-2,500 range.

8. Indian Head Half Eagle: The 1909-O is the only one-year half eagle type from New Orleans. It is also regarded as one of the rarest Indian Head half eagles in high grades. Most 1909-O half eagles grade Extremely Fine-45 to About Uncirculated-55. This is a scarce coin in About Uncirculated-58, a rare one in the lower Uncirculated grades and a very rare issue in Mint State-63 or better. A nice Mint State-60 to Mint State-62 example should cost in the area of $5,500 to $10,000+.

9. No Motto Liberty Head Eagle: There were twenty-one different No Motto eagles struck at the New Orleans mint between 1841 and 1860. This includes a Large Date and Small Date variety in 1854. The rarest issues of this type are the 1841-O and the 1859-O while the most available dates are the 1847-O and the 1851-O. While a number of these issues have reasonably high mintage figures, Eagles were a workhorse denomination in local commerce. This resulted in most issues being well circulated. In addition, many coins were melted. As a result, any Uncirculated no motto New Orleans eagle is very scarce. A nice Mint State-60 to Mint State-62 piece should be available in the $5,000 to $10,000 range.

10. With Motto Liberty Head Eagle: After the end of the Civil War, the New Orleans mint was closed. It did not resume coinage until 1879. From this year until 1906, a total sixteen different With Motto Liberty Head eagles were produced. The major rarities of this type are the 1879-O and the 1883-O while a number of issues, such as the 1903-O, 1904-O and the 1906-O, can be located in grades up to and including Mint State-63 without much effort. Any date of this type in Mint State-64 is quite rare and gems, while more available than other large denomination New Orleans gold coins, are still very rare and desirable. A common date example in Mint State-63 is currently valued at $1,500 to $2,000 and in Mint State-64 at $4,500-6,000+.

11. Type One Liberty Head Double Eagles: This type was struck from 1850 to 1861. There were a total of twelve issues produced. This includes two legendary rarities: the 1854-O and the 1856-O. For type purposes, the two most practical dates are the 1851-O and the 1852-O. These are common in lower grades, scarce in the higher About Uncirculated grades and very rare in Mint State-60 or better. A Mint State-60 to Mint State-62 examples of one of these two issues is valued at $12,500-22,500. Most other Type One double eagles from this mint are extremely rare in Uncirculated and are not practical for a type set.

12. Type Two Liberty Head Double Eagles: Only 2,325 Type Three double eagles were struck at this mint and all were produced in 1879. The 1879-O is a rare and very popular coin whose status is enhanced as a one-year type. When available, this coin is typically seen in the Extremely Fine-40 to About Uncirculated-50 range. There are only four to six known in Uncirculated and the finest of these sold at auction for $115,000 in late 2001. In most type collection of New Orleans gold coins, this will be one of the few pieces that are not Uncirculated. A nice mid-range About Uncirculated example should cost $15,000 to $20,000.

In my opinion, the basic twelve coin New Orleans type set is a very interesting option for the collector. The price ranges listed above are for high end examples, and this set could be assembled for $30,000-40,000+ if Extremely Fine-45 to About Uncirculated-55 pieces are substituted for such expensive types as the three dollar gold pieces and the Type One and Type Three double eagles.

Deconstructing Ten Popular Coin Maxims

We've all heard them a thousand times: the numismatic maxims that have been repeated enough times that they have acquired near-mythic status. So are they true or not true? 1. "Size Matters"

True. Big coins are more popular than small coins and will continue to be. While there are some small coins that are popular (most noticeably branch mint gold dollars) most others are unpopular. Double eagles may seem high priced given their mintage figures and relative availability but the demand for choice and rare pieces is increasing. In the long run, it seems likely that new collectors will prefer the heft of larger-sized gold coins than their smaller counterparts.

2. "Sets Are Worth More Than Individual Coins"

True. One of the most significant developments in the coin market in the past few years has been the PCGS Registry Set. Collectors are now able to post the grades of their coins and compete against others. So far, this has most dramatically impacted modern issues. It is likely that "classic" 19th century issues will see more competitive set building in the coming years, especially as such sets are promoted by dealers and encouraged by PCGS and their collectorsuniverse.com website.

An exception to this maxim is a meaningless set. As an example, a set of 1850-O gold coins (gold dollar, quarter eagle, eagle, and double eagle) is not worth any premium over individual price levels for each piece. But, a complete set of New Orleans quarter eagles is worth more, as a set, than the individual coins.

3. "If It's Slabbed It's Properly Graded"

False. There is a definite hierarchy when it comes to third-party graded coins. Clearly, PCGS and NGC are the two best grading companies. The next tier is occupied by ICG and ANACS who are also good but whose product is not valued as highly in the marketplace as PCGS and NGC's. The bottom rung is occupied by such firms as SEGS, PCI and Accugrade. These services grade much more liberally and allow many "problem" coins into their holders. New collectors should be careful to realize that a 1907 High Relief in SEGS Mint State-64, as an example, is typically worth far less than the same issue in a PCGS or NGC MS-64 holder.

4. "Grade Is Better Than Rarity"

False. Back in the 1980's, there was a widely-held belief that if a coin was not a "gem" than it was essentially worthless. When coin prices came crashing down in the early 1990's, it was ultra-high grade common issues that suffered the most. As the market became more sophisticated, rarity became more appreciated and in recent years it has generally outperformed grade.

The ideal coin collection features "fundamentally rare" coins in comparatively high grades stressing eye appeal and originality. By fundamental rarity, I mean a coin whose rarity and desirability is not wholly a function of its grade. As an example, a 1795 eagle is a desirable coin whether it is a damaged Very Good or a superb Mint State-65. An 1895 eagle has very little value above its bullion content in low grades and really only attains numismatic value at the Mint State-64 to Mint State-65 level. For this reason, a coin like a 1795 eagle is "better" than an 1895 eagle.

5. "All Coins Sell Best At Auction"

False. For very rare or very high grade coins, auction is an excellent selling venue. But auction is not ideal for all coins or collections.

If you have a collection that primarily features generic coins or have a large amount of coins with tight buy sell spreads (like modern proofs sets and mint sets) then it makes sense to sell these to your local coin dealer. The 10-15% that you pay to the auction company will erode your entire profit margin.

High quality, "fresh" coins sell very well at auction. In some cases, however, private treaty sales can work every bit as well or better. As an example, a specialist dealer may be a better choice to handle the sale of a small to medium sized collection than an auction house. My firm has been chosen to sell some wonderful specialized collection of branch mint gold and has, in my opinion, done a better job of getting top dollar for the owners than if the coins had been placed in auction.

6. "Buy The Book Before The Coin"

True. This hoary old maxim has been repeated to the point of triteness but it remains one of the best pieces of advice a new collector can get. All collectors should assemble a good library of basic coin books and, once they have decided on an area of specialization, assemble a comprehensive specialized library.

Once the basic books have been purchased, it may take some work to find scarce, out-of-print specialty works. The collector should contact numismatic book dealers and specialist dealers to get their input as far which books are important and which are not. If you spend thousands (or ten of thousands) or dollars per year or coins and nothing on books, you are operating under flawed logic.

7. "Quality Is Better Than Quantity"

True. Many new collectors begin with the idea that it is good to have lots of average quality coins. The best collections focus on quality over quantity. In most instances, this means that an important specialized collection will not have more than a few hundred pieces. There are, of course, exceptions to this rule. The Harry Bass collection contained thousands of American gold coins. But many of these were duplicates or they represented lower grade die varieties. Plus, Bass had the good fortune to be buying gold coins when they were reasonably priced. Today, it is not practical to assemble a collection as large as the Bass holdings; both from the standpoint of cost and availability.

I purchase (or attempt to buy) collections all the time. The ones that impress me most are "lean and mean." They contain choice, attractive, interesting coins and often number fewer than one hundred individual pieces.

8. "Non-U.S. Coins Are Good Investments"

False. There are more serious coin collectors in the United States than in all other countries combined. Because of this, it remains unlikely that non-American coins will ever show considerable price appreciation. This doesn't mean that foreign or ancient coins are "bad deals" and should not be purchased. It just means that if you are concerned with the return on your numismatic investment dollars, you should stick with American coins. Look at foreign coins as a pleasant diversion that can fill in the down time between significant purchases of American issues.

9. "Don't Be Loyal To A Single Coin Dealer"

False. If you study the buying habits of the greatest collectors, you will note one particularly significant common factor. All of these individuals had close working relationships with one or two coin dealers. This meant that they were able to purchase the best coins from these dealers at fair prices.

The worst way to assemble a collection is to buy fifty coins from fifty different dealers. By doing this you will never earn "most favored nation" status with any one dealer. You may get to speak with a lot of different people (which may not be a good thing...) but you will never get the really good service that they give to their best clients.

10. "High Grade Modern Coins Are A Time Bomb"

True. Tick, tick, tick... The sound you hear is the modern coin market getting ready to self-destruct. In the past year, prices for low population ultra high grade modern coins have skyrocketed. I personally think they are due for a major correction. The most obvious reason for this is potential supply. When price levels for a modern issue are low, there is no motivation to send in examples to PCGS or NGC. But when price levels raise to the point that there is reason to send them in, the floodgates open. Most of these modern issues have mintage figures in the hundreds of millions (or even billions!) and were carefully manufactured. In addition, they are not graded as carefully as older coins. Thus, today's low population modern coin is tomorrow's pocket change in a fancy plastic holder. Proceed with caution!!

The Type Collectors Approach to Branch Mint Gold Coinage

Most branch mint gold collectors focus on a specific mint and then assemble a date set. As an example, a Charlotte collector often decides to specialize in quarter eagles and then attempts to assemble a complete set of twenty issues. This has become more difficult, though, due to the high price of choice coins and the relative unavailability of nice, original affordable medium grade examples. As a result, many date collectors become frustrated and abandon their specialty.

There is a solution to this problem. Collecting coins by type entails acquiring a single representative of a design or variety and supplementing it with other types. There are some variations on this theme which apply well to branch mint gold. These include the following:

I. The Basic Type Set

A basic type set includes a single example of every design that was struck at a specific mint. This will be discussed more specifically below.

II. The Denomination Set

This is one of the simplest and most affordable ways to collect branch mint gold. As an example, a denomination set of Carson City gold would include an example of a half eagle, an eagle and a double eagle.

III. The Decade Set

This set includes an example of a denomination in each decade it was struck. As an example, a decade set of Carson City double eagle would contain three coins: one each from the 1870's, 1880's and the 1890's.

IV. The Year Set

A year set contains an example of each denomination from a specific mint struck during a specific year. An example of this would be an 1878-CC year set which would contain a half eagle, eagle and double eagle from this year.

Let's look at the most popular branch mints (in alphabetical order) and see how these collecting methods apply to them.

A. CARSON CITY GOLD COINS

The prohibitive price of most high grade Carson City gold coins makes them a perfect candidate for type collecting.

A basic type set of Carson City gold coins contains the following four designs:

• With Motto Liberty Head Half Eagle (1870-1893) With Motto Liberty Head Eagle (1870-1893) Type Two Liberty Head Double Eagle (1870-1876) Type Three Liberty Head Double Eagle (1877-1893)

The basic four coin set can be completed for a very reasonable sum if a collector selects common dates in affordable grades. The more affordable coins include the 1891-CC half eagle and eagle, the 1875-CC double eagle and the 1884-CC or 1893-CC double eagle. Or, this could be a small but expensive set if rare dates in high grades are used.

A denomination set of Carson City half eagles consists of just three coins: half eagle, eagle and double eagle. As with the basic type set, this group can be assembled for a reasonable sum or it can be an "over the top" trio with very high grade (in this case, Mint State-63 and Mint State-64) examples of available issues. Another option would be to select rare dates for all three denominations and attempt to purchase them in the best available grade.

Building a decade set of Carson City gold coinage is interesting and challenging. For both the half eagle and eagle denominations, a coin from the 1870's is the most challenging, with the 1880's and 1890's issues progressively easier to obtain in higher grades. A complete nine piece decade set of Carson City gold (containing three half eagles, three eagles and three double eagles) would be a very desirable group.

There are many interesting year set options for the Carson City gold coin collector. The 1870-CC issues are all very rare and are historically important as the first gold issues from this mint. The 1893-CC issues are considerably more affordable but are also interesting as the final Carson City gold coins. Practically speaking, any year set from the 1870's will contain rare but fairly expensive coins while the 1890's issues will be more common but far more affordable. A good alternative is a date from the 1880's. The only years in which all three denominations were produced are 1882 and 1884. Both contain coins that are obtainable in higher grades (in this case up to About Uncirculated-55) but are still reasonably priced.

B. CHARLOTTE GOLD COINS

Charlotte gold coins have many more basic types than their counterparts from Carson City. This makes them an excellent choice to collect in this manner. The basic type set of Charlotte issues consists of the following eight coins:

• Type One Gold Dollar (1849-1853) Type Two Gold Dollar (1855 only) Type Three Gold Dollar (1857 and 1859) Classic Head Quarter Eagle (1838 and 1839) Liberty Head Quarter Eagle (1840-1860) Classic Head Half Eagle (1838 only) Liberty Head Half Eagle, Obverse Mintmark (1839 only) Liberty Head Half Eagle, Reverse Mintmark (1840-1861)

This eight coin set is not hard to assemble as none of the specific types is extremely rare or expensive in average circulated grades. However, this set can become very expensive (and a real challenge) if the collector wants to acquire each coin in as high a grade as possible. A pair of specific issues, the Type Two gold dollar and the Classic Head half eagle, are very rare and expensive in Uncirculated. In fact, I have only seen three or four Uncirculated Type Two Charlotte gold dollars and just two Classic Head half eagles from this mint in over twenty years of specializing in Charlotte coinage.

A three coin denomination set of Charlotte gold coins is an excellent introduction to this mint. If the collector chooses issues such as the 1851-C gold dollar, 1847-C quarter eagle and the 1857-C half eagle he can assemble a set that includes high grade pieces that are quite affordable. Or, he can pick scarcer issues to make this a more numismatically interesting group.

Charlotte coins were struck during four decades: the 1830's, 1840's, 1850's and 1860's. This means, obviously, that a decade set consists of four coins. Since gold dollars were not produced during one of these decades (the 1830's), this four coin decade set would either contain quarter eagles or half eagles; or even a combination of the two.

There were only five years in which the Charlotte mint produced coins from all three denominations: 1849, 1850, 1851, 1852 and 1855. Any one of these years would lend itself well to a challenging three coin year set. The rarity of the quarter eagles struck in each of these years would make this set extremely hard to complete in Uncirculated. A nicely matched About Uncirculated set is a more practical alternative for most collectors.

C. DAHLONEGA GOLD COINS

Dahlonega gold coins are often collected alongside Charlotte issues. As with Charlotte coins, there are a number of interesting Dahlonega types and this makes them another excellent area to collect in one of the following manners. A basic type set of Dahlonega coins consists of the following:

• Type One Gold Dollar (1849-1854) Type Two Gold Dollar (1855 only) Type Three Gold Dollar (1856-1861) Classic Head Quarter Eagle (1839 only) Liberty Head Quarter Eagle (1840-1859) Three Dollar Gold Piece (1854 only) Classic Head Half Eagle (1838 only) Liberty Head Half Eagle Obverse Mintmark (1839 only) Liberty Head Half Eagle Reverse Mintmark (1840-1861)

This nine coin set is quite a bit more expensive to assemble than the Charlotte eight coin set. This is due to the presence of the rare and popular 1854-D Three Dollar Gold Piece. A nice example will cost in the area of $15,000-25,000+ and it is far and away the most expensive single type from any of the Southern branch mints. The collector on a more limited budget might simply elect to not include this coin. The next most difficult issue to obtain in higher grade is the Type Two gold dollar. There are just three Uncirculated examples currently known (all are in tightly-held collections) and even nice About Uncirculated examples are rare and expensive. Figure spending $15,000-25,000 for a well struck, accurately graded About Uncirculated 1855-D gold dollar.

A denomination set of Dahlonega issues includes four coins. As mentioned above, the Three Dollar gold piece is an expensive piece that will constitute a good percentage of the money spent on this set. It is always an option to "forget" that this coin exists and make the denomination set consist of three issues. If a collector wishes to include coins in higher grades In this case About Uncirculated-55 to Mint State-62), he should focus on such relatively available issues as the 1849-D gold dollar, the 1843-D, 1844-D or 1848-D quarter eagles and the 1852-D, 1853-D or 1854-D half eagles.

Assembling a four coin decade set of Dahlonega coins is an interesting approach to collecting issues from this mint. However, if the collector seeks to assemble such a set using only one denomination than he must select half eagles as these were the only coin struck at Dahlonega in the 1830's, 1840's, 1850's and 1860's. This would be a very numismatically interesting set and it could be completed in grades ranging from Very Fine to Mint State-62.

There was only one year in which the Dahlonega mint produced coins in all four denominations: 1854. This would make an extremely interesting year set. The years in which three coins were produced simultaneously are 1849, 1850, 1851, 1852, 1853, 1855, 1856, 1857 and 1859. A few of these years are more practical for the collector on a budget as they do not contain a specific issue that is rare and/or expensive. These "easy" years include 1849, 1850, 1857 and 1859. In the other years, the quarter eagle tends to be the rarest and most expensive coin.

D. NEW ORLEANS GOLD COINS

The New Orleans mint was open for a far greater period of time than Carson City, Charlotte and Dahlonega and more types of gold coins were produced. A basic type set from this mint consists of the following:

• Type One Gold Dollar (1849-1853) Type Two Gold Dollar (1855 only) Classic Head Quarter Eagle (1839 only) Liberty Head Quarter Eagle (1840-1857) Three Dollar Gold Piece (1854 only) Liberty Head Half Eagle Without Motto (1840-1857) Liberty Head Half Eagle With Motto (1892-1894) Indian Head Half Eagle (1909 only) Liberty Head Eagle Without Motto (1841-1860) Liberty Head Eagle With Motto (1879-1906) Type One Liberty Head Double Eagle (1850-1861) Type Three Liberty Head Double Eagle (1879)

This twelve coin set is very interesting in that it contains no less than four one year types. Fortunately, only one of these is rare in any grade (the 1879-O double eagle) and the other three can be obtained in comparably high grades for reasonable prices. The average grade(s) should be higher than for Charlotte or Dahlonega sets due to the affordability of many of the types. In fact, even a collector with a modest budget should be able to purchase About Uncirculated examples of most of the types and Extremely Fine examples of the scarcer issues.

The denomination set from New Orleans is unique among the mints we are discussing as it contains six coins. Unlike the 1854-D Three Dollar Gold Piece, the 1854-O is an affordable issue in most circulated grades. A representative Uncirculated gold dollar, quarter eagle, half eagle and eagle from New Orleans are all very affordable. The most difficult--and expensive--denominations from this mint are the Three Dollar Gold Piece and the Double Eagle. An Uncirculated 1854-O Three Dollar Gold Piece, if available, will cost at least $12,500-15,000 while an Uncirculated New Orleans Double Eagle, most likely an 1851-O or an 1852-O, will cost as much or more than the aforementioned Three Dollar gold piece.

New Orleans gold coins were struck in no less than seven decades: the 1830's, 1840's, 1850's, 1860's, 1870's, 1880's, 1890's and 1900's. This seven coin decade set is reasonably easy to complete. The 1830's must be represented by a Classic Head quarter eagle from 1839 as this was the only gold coin produced at the New Orleans mint during this decade. Luckily, this is a relatively common and inexpensive coin. During the 1860's, coinage was limited to eagles (1860 only) and double eagles (1861). Both of these issues are scarce but are not expensive unless the collector wishes to obtain a coin that approaches the Uncirculated level. In the 1870's, coinage was, again, limited to eagles and double eagles (both in 1879 only). These are both scarce and desirable but nice quality 1879-O eagles and double eagles can be obtained in the $10,000-15,000+ range. In the 1880's, the only denomination struck at the New Orleans mint was the Eagle. The 1888-O is the most affordable of the five Eagles produced during the 1880's.

There was never a single year in which all six denominations produced at the New Orleans mint were struck simultaneously. The closest a collector can come to this is a year set containing five different denominations from New Orleans. The only year this occurred was 1851. Fortunately, none of the 1851-dated New Orleans coins are rare and most are readily obtainable in the higher circulated grades. An ambitious collector with a large budget could even assemble an Uncirculated 1851-O year set as all five denominations exist in Uncirculated grades ranging between Mint State-60 and Mint State-62.

Collecting branch mint gold coins by date is certainly not for everyone and, hopefully, some of the "type-centric" suggestions offered above will be of interest to the new or frustrated advanced collector.

Ten Undervalued U.S. Gold Coins Under $2,500

Many of the articles that I have written in the past have focused on expensive, "glamorous" issues. I may have given the unfair impression that collecting United States gold is a rich man's pursuit. This is clearly not the case. There are a number of exciting, undervalued coins that can be purchased for $2,500 or less. I have decided to focus on ten of these issues but I could just as easily made a list of twenty, thirty or even forty undervalued United States gold coins. With a little effort, a collector should be able to compile a list of similar pieces as well.

Please note that Trends prices in this article refer to those listed in the February 19, 2001 issue of Coin World. PCGS populations are based on February 2001 figures.

1856 Upright 5 Gold Dollar, MS-64 1844 Quarter Eagle, AU-50 1883 Quarter Eagle, MS-61 1881 Three Dollar Gold Piece, EF-45 1858-S Half Eagle, EF-45 1863 Half Eagle, EF-40 1844 Eagle, EF-45 1873-S Eagle, Ef-45 1863 Double Eagle, AU-53 1868 Double Eagle, AU-55

I. 1856 Upright 5 Gold Dollar, MS-64

There are two varieties of date style known on 1856 gold dollars. The more common shows a Slanted 5. The Upright 5 is a scarce and very undervalued issue in my opinion. Trends for this variety is $1,800 in MS-64 versus $1,475 for the Slanted 5. Current PCGS populations for the two varieties are forty-two with twelve better for the Slanted 5 and two with three better for the Upright 5. Even if you take into consideration that these figures are skewed by virtue of the Upright 5 being a relatively new addition to the Population Report, this is still a very undervalued coin and a great value in the $1,500-1,750 range.

II. 1844 Quarter Eagle, AU-50

The Philadelphia quarter eagles struck between 1840 and 1849 include some extremely undervalued issues. The 1844 is among the best values in this group. There were just 6,784 produced and 45-55 are known today. In high grades, the 1844 is a major rarity. I have personally only seen one example better than AU-55. In fact, in all grades of AU, there are fewer than ten known. Trends for an AU-50 is $2,250. In this grade, the 1844 is as rare or rarer than the 1844-C quarter eagle and Trends for that date in AU-50 is $6,500.

III. 1883 Quarter Eagle, MS-61

Only 1,920 quarter eagles were produced in 1883. Unlike some of the other low mintage quarter eagles of this era, not many were saved by contemporary collectors or hoarders. As a result, it is rare in all grades and is almost never seen better than Mint State-62. As of February 2001, PCGS had graded five in Mint State-61, four in Mint State-62 and none better. Trends is just $1,900 in MS-60 and $3,250 in MS-62, meaning that a nice MS-61 could be bought for $2,250 - $2,500.

IV. 1881 Three Dollar Gold Piece, EF-45

Four little words best describe the appeal of this issue: "only five hundred struck!" The problem with including this date in our list is that locating an example in Extremely Fine will be very difficult. The 1881 Three Dollar Gold Piece did not actively circulate and most survivors are in the AU-55 to MS-63 range. But with Trends for an Extremely Fine-40 example currently a mere $2,000, you'd certainly add a nice Extremely Fine-45 to your collection if one became available.

V. 1858-S Half Eagle, EF-45

This date has been a favorite of mine for many years. It is considerably rarer than any Charlotte or Dahlonega half eagle from the 1850's yet it has a current Trends value of only $3,300 for an Extremely Fine-45. There are 30-40 known and just four of five grade AU. A nice EF-45 example would be among the finest known and would set you back $2,500-3,000. Compared to other branch mint No Motto half eagles, the 1858-S is an incredibly good deal.

VI. 1863 Half Eagle, EF-40

I once made the mistake of telling another dealer I could find him a nice Extremely Fine 1863 half eagle with minimal effort. It took me over a year and I looked for one at every coin show and major auction I attended. This Civil War issue had a small original mintage of 2,442 and a high attrition rate. Today, there are probably no more than 30-40 known. Around a dozen grade Extremely Fine and six to nine are About Uncirculated. Trends is $3,500 and you might have to stretch and pay as much as $3,000 for a nice EF-40 coin. In my opinion, this would be a very prudent purchase, give the rarity of the 1863 half eagle.

VII. 1844 Eagle, EF-45

The 1844 is the rarest Philadelphia Liberty Head eagle made prior to 1858. There were 6,361 struck and an estimated 40-50 are known today. It is a major rarity in grades above About Uncirculated-50 and most of the survivors are in the VF-35 to EF-45 range. A nice EF-45 is valued at $2,500-3,000 in today's market. If you can find such a coin, you'll be the owner of a near-Condition Census quality example of a truly rare date.

VIII. 1873-S Eagle, EF-45

San Francisco eagles are among the most out-of-favor issues with collectors. But that doesn't mean that there are not some excellent values for the contrarian. There were 12,000 1873-S eagles produced and approximately fifty exist today. Nearly all of the survivors grade EF-40 or thereabouts and this issue becomes a major rarity in About Uncirculated. Current Trends for an EF-45 is $3,250, meaning that a nice EF-45 could be obtained for $2,500 or a touch more. This is a truly rare (and undervalued) coin.

IX. 1863 Double Eagle, AU-53

It is harder to find undervalued issues in the Liberty Head double eagle series that any other 19th century gold type. But the 1863 stands out as a truly underpriced coin. It is almost never seen above AU-55, making an AU-53 surprisingly close to Condition Census quality. If available, an AU-53 should cost $2,500 or a bit more. But be forewarned that you will have a lot of competition for such a coin. If I could somehow find a dozen nice AU-53 1863 double eagles, I could probably sell them all within a few hours.

X. 1868 Double Eagle, AU-55

Type Two double eagles are exceptionally popular. Despite this fact, the 1868 has remained a tremendously undervalued issue. It is the rarest Philadelphia issue of this type and it is almost never seen above AU-55. Current Trends for an AU-55 is $2,875 and if you find such a coin, you'll probably have to pay close to this amount. But an AU-55 1868 Double Eagle would be a great addition to any collection. PCGS has graded just seven better than this (and none of these are higher than MS-60) and I have not personally seen or sold more than a small handful that grade higher.

Conclusion: In closing, I have a word of advice. Don't try to assemble a collection that includes all of the above coins in the exact grades listed. Their lack of availability will prove frustrating. I would rather that this list inspire you to find your own "Top Ten" list of undervalued issues.

If you need help in compiling such a list, or would like to share your own "Top Ten" list with me, feel free to email me.

Classic Head Gold Coinage, 1834-1838 Part One

For the first quarter of the 19th century, production of gold coinage was sporadic. Quarter eagles were produced intermittently and in very small numbers during this era. Half eagles saw the bulk of production but they were primarily storehouses of value and traveled from bank to bank. The eagle denomination was discontinued in 1804 and would not be resurrected until 1838. Many of the reasons for this lack of gold coin production were economically related. After the War of 1812, the economy of the United States was in shambles. Things became so bad by 1815 that, for the first and only year in the history of the U.S. mint, production of the Cent was suspended. In addition, the price of gold was very low in relation to silver and demand for high denomination gold coinage was non-existent.

A number of events converged to change this scenario. The Industrial Revolution, which overtook Western Europe during the early 1820's, was quickly transported to America, where it, too, revolutionized the economy and means of production. The discovery of large amounts of gold in Western North Carolina and North Georgia in the late 1820's and the early 1830's made gold more plentiful and made its price rise on the open market. By the middle part of the 1830's, there was clearly a need for circulating gold coins in the United States.

Chief Engraver William Kneass was ordered to produce a new design for the quarter eagle and half eagle. His design, known to collectors as the Classic Head, was to last until 1839 when it was replaced by the more familiar Liberty Head design of Christian Gobrecht.

Classic Head gold coinage represents an interesting transition between the old and the new types of United States gold coinage. These were the first United States gold coins to be produced in large quantities using technological breakthroughs such as the steam press and they were the first gold coins to be struck at the new branch mints which were authorized in 1835 and opened in 1838.

Despite the inherent collectability of these coins, they tend to be overshadowed by their earlier and later counterparts. It is my opinion that the Classic Head gold coins offer the collector an excellent value and a very fertile area in which to specialize.

A number of very interesting varieties exist for many of these dates. These are not currently popular with collectors but the affordability of most Classic Head issues (especially those produced at the Philadelphia mint) make them a good candidate to develop a strong die variety collector following in the future.

Classic Head Quarter Eagles

1834: More quarter eagles were struck in this year (112,234) using the Classic Head design than in the previous twenty years combined. The 1834 is, along with the 1836, the most common issue of this denomination and it is plentiful in all circulated grades. In Uncirculated, it is relatively available in the Mint State-60 to Mint State-63 range and is even available, from time to time, in Mint State-64. Gems are very scarce but are seen more often than any other Classic Head quarter eagle. The strike is usually sharp except for the hair curl around the ear of Liberty and on the corresponding reverse. The surfaces are often semi-prooflike or even fully prooflike and the natural color is often a very pleasing deep green-gold hue. Many show mint-made planchet problems. A small number of Proofs exist including the Pittman II: 1718 coin that realized $176,000 in May 1998.

A number of varieties exist. The most important are the Small Head (identifiable by the curl below star seven being somewhat distant and the curls at the back of the head being in a straight line) and the Large Head (identifiable by the curl below star seven being close, a much larger 4 in the date than on the Small Head and uneven curls at the back of Liberty's head).

1835: Despite a mintage similar to the 1834, this is a much scarcer date. It is typically seen in Very Fine to About Uncirculated grades. When available in Uncirculated, specimens tend to grade Mint State-60 to Mint State-62 and coins grading Mint State-63 and above are rare. I have only seen one or two real gems. The strike is not as sharp as on the 1834 with most showing considerable weakness at the central obverse. The luster ranges from frosty to semi-prooflike and the natural color is most often a medium to deep green-gold. The only Proof to be sold in recent memory was the Pittman II: 1719 coin that realized $176,000 in May 1998.

There are three minor die varieties with one obverse and three reverses employed.

1836: An incredible 547,986 quarter eagles were produced in 1836; a mintage figure that would not be exceeded in the quarter eagle denomination until 1851. This date is comparable to the 1834 in terms of its overall rarity and is also readily available in the lower Uncirculated grades. It is considerably scarcer than the 1834 in Mint State-63 and Mint State-64 and it is extremely rare in Gem condition. The strike is better than on the 1834-35 issues although most show weakness at the central obverse. The luster is typically a blend between satiny frost and prooflike reflectiveness while the coloration ranges from medium orange-gold to green-gold. A Proof was sold as Lot 1720 in the Pittman II sale and it brought $110,000.

A number of interesting varieties exist. This includes two distinct styles of 8 in the date: the Script or "Fancy" 8 and the Block 8. In addition, varieties exist with the Head of 1834 (the second curl on the top of Liberty's head lies directly the seventh star), the Head of 1835 (the second curl lies below the far left side of the seventh star) and the Head of 1837 (the second curl lies below the far right side of the seventh star). There are currently eight die varieties known and this is a very fertile issue for the die variety collector.

1837: The mintage figure for quarter eagles dropped to 45,080 in 1837. This issue is far more rare than the 1834-1836 and is exceeded in rarity only by the 1839 among the Philadelphia Classic Head quarter eagles. The 1837 is usually seen in Very Fine to extremely Fine grades and it is scarce in About Uncirculated. It is rare in any Uncirculated grade and very rare above Mint State-62. The only gem I have ever seen was the Bass II: 305 coin which was graded MS-65 by PCGS and which sold for $37,950 in 1999. This date is always found weak at the centers but usually has nice satiny luster and medium to deep green-gold color. In my opinion, it is a substantially undervalued issue.

There are a total of three die varieties but, unlike the 1836, none are significant.

1838: The 1838 has a mintage figure that is similar to the 1837 (47,030 were produced) but it is much more readily available. It is typically seen in slightly higher grades than the 1837 and locating a piece in any circulated grade is not hard. In high grades, the 1838 is moderately scarce in Mint State-60 to Mint State-62, rare in Mint State-63 and very rare above this. A few really superb pieces exist with the finest of these the incredible PCGS MS-67 that sold for $69,000 in the Bass II auction conducted by Bowers and Merena in October 1999. The 1838 is usually better struck than other Classic Head issues and has nice frosty luster, medium to deep orange-gold color and a very distinctive thick border on the obverse.

Only one die variety is known.

1838-C: This is the first branch mint quarter eagle and, obviously, the first Charlotte quarter eagle. Only 7,880 were struck and around 100-125 exist. Circulated examples tend to be well worn with most in the Very Fine to Extremely Fine range. While fairly hard to locate in the middle About Uncirculated grades, choice AU and Uncirculated 1838-C quarter eagles are actually a bit more easily located than generally believed; this is probably due to a small number being saved as souvenirs. There are as many as ten-twelve known in Uncirculated with the nicest of these being the North Georgia collection/Melish coin that sold for $40,250 in the 1999 FUN sale conducted by Heritage. Most show weak strikes at the centers, heavily abraded surfaces and low quality satiny luster. The original coloration tends to be a deep coppery-gold or green-gold.

Only one die variety is known. There are a number of Die States in which varying cracks are seen on the reverse.

1839: While almost never viewed as an important issue, the 1839 is actually the single scarcest Classic Head quarter eagle. I have personally owned more Uncirculated examples of the 1838-C, 1839-C and 1839-O than I have of this supposedly common date. The 1839 is most often seen in Extremely Fine and lower end About Uncirculated grades. It is very scarce in the higher AU grades and it is very rare in Uncirculated with fewer than ten known. The best I've personally seen are a pair of MS-62's including the Bass II: 309 coin that sold for $10,925. This is generally a well struck date that shows numerous surface abrasions and inferior luster. The natural coloration seen most often is light to medium greenish-yellow gold.

The 1839 is often described as an overdate but, in my opinion, it is a repunched date. There is only a single die variety known.

1839-C: The 1839-C is a much more available issue than the 1838-C. There are as many as 200-250 known and it is not hard to locate an example in Very Fine to Extremely Fine. There are more known in About Uncirculated than generally realized but many of these are enthusiastically graded. Uncirculated 1839-C quarter eagles are extremely rare and I have seen fewer than I have of the 1838-C. The finest known is the Miller/Bareford/Boyd coin, currently in an NGC MS-63 holder, that was last offered as Lot 6137 in Heritage's February 1999 sale. Most 1839-C quarter eagles are better struck than the 1838-C but tend to show weakness at the centers. The luster is usually not especially good and the natural color ranges from orange-gold to a medium green-gold hue.

There are three varieties known. An 1839-C recut date exists as does an 1839/8-C overdate. The overdate is found with two reverse varieties (one uses the reverse of 1838-C while the other is a reverse seen only on 1839-C quarter eagles).

1839-D: The 1839-D is the first quarter eagle produced at the Dahlonega mint and the only issue that has the Classic Head design. It is, in addition, the only quarter eagle from this mint with the mintmark on the obverse. It is quite comparable to the 1839-C in terms of its overall rarity and, like its Charlotte counterpart, it can be located in the lower to middle About Uncirculated grades without a great deal of effort. In Uncirculated it is more comparable in rarity to the 1838-C and less rare than the 1839-C but far rarer than the 1839-O. Some examples are very softly struck at the centers although a few exist that are reasonably well detailed. The surfaces are often abraded and the luster is better than average with a frosty texture most often seen. The natural color is a medium to deep orange-gold. The best piece I have ever seen is the James Stack coin, sold by Stack's in October 1994 for $55,000. It is now in a PCGS MS-64 holder.

1839-O: The 1839-O is the first gold coin produced at the New Orleans mint, the only quarter eagle that employs the Classic Head design and the only New Orleans gold coin with the mintmark on the obverse. These factors combine to make it extremely popular. More survive than the original mintage figure of 17,781 suggests and this is actually not a hard coin to locate in any grade up to and including About Uncirculated-58. There are a few dozen Uncirculated pieces known including a number in the Mint State-63 to Mint State-64 range. I have seen three or four accurately graded MS-64's and one that I consider a Gem by today's standards. Some show a good strike while others are weak at the centers; the luster is typically frosty and the natural coloration is often a pleasing orange-gold or deep green-gold hue. Many have been cleaned or dipped and original, problem-free pieces are desirable.

There are two varieties known. The more common has a high date with the 3 lower than the 89 and a widely spaced fraction; the scarcer has a lower date with the 839 more closely in line and a closely spaced fraction. These varieties are significant enough that I believe they will be collected side-by-side some day.

NOTE: Part Two will feature an analysis of Classic Head half eagles and will appear next month.

The Concept of "Best Value Grade"

Unless you are Bill Gates, the chances are good that you have a coin buying budget. It is my contention that every United States coin has a price point above which it no longer makes economic sense to purchase it; unless you are an avid specialist within a series or you are totally compelled to have the best of every coin and/or type you collect. I refer to this price point as the "Best Value Grade." There are a number of applications of the Best Value Grade theory (heretofore referred to as the BVG) and these are directly related to the classification in which a specific coin falls.

In my opinion, coins can be classified in two distinct classes: absolute rarities (coins that are rare and desirable in all grades) and condition rarities (coins whose rarity is predicated solely on a high level of preservation). Using Type Three double eagles as the series to examine some coins, we find a number of perfect examples.

The 1891 double eagle is an absolute rarity. Fewer than 50 examples are known from the original mintage of just 1,390 business strikes. This is truly a coin that can be described as rare and desirable in any grade. Coin World Trends (dated 2/28/00) shows the following price information for this date:

EF-40: $4000 EF-45: $5000 AU-50: $7750 AU-55: $11750 No Trends values are listed for this date in any grade above AU-55.

Population data on this date is interesting as well. As of 2/00, PCGS had seen a total of just 25 examples in all grades (quickly confirming that it is a true rarity) with the breakdown as follows:

EF-40: 2 coins EF-45: 1 coin AU-50: 7 coins AU-55: 5 coins Five coins have been graded higher than AU-55 (all AU-58) with none in Mint State.

This data shows that the 1891 double eagle is seldom available and when it does come up for sale, it is most likely to be found in the AU-50 to AU-55 range. Assuming that your budget allows for a purchase in the $7500-15,000 range, the question you must now ask is: "at what point does the 1891 double eagle become overpriced?"

It could be said that there is no real point that the 1891 becomes overvalued as this is a truly rare coin that seems quite undervalued when compared to other more famous but less rare double eagles. But let's say that a collector has a choice between an AU-50 example at $6500 and an AU-55 at $10,000. In my opinion, I think the higher grade coin makes sense. It is priced at less than double the level of an AU-50 but is considerably scarcer, quite close to being the finest available quality (remember that the highest recorded grade level for this date at PCGS is only AU-58) and, from a cosmetic standpoint, a nice AU-55 should be considerably more appealing than an AU-50.

The 1891-S double eagle is a good example of a condition rarity. Nearly 1.3 million were struck and thousands of examples exist in the lower to medium levels of Uncirculated. Coin Dealer Newsletter bids for this date, as of 12/99, are as follows:

MS-60: $390 MS-63: $2,040 MS-64: $6,100 MS-65: No Bid (Note: While there is no published bid for this date in MS-65, we can establish a hypothetical value level of $15,000-17,500, based on other comparable issues of this era).

The 2/00 PCGS Population report shows that 1,840 1891-S double eagles have been graded in all grades with the majority of these in the MS-60 to MS-63 range. The breakdown is as follows:

MS-60: 164 MS-61: 459 MS-62: 784 MS-63: 217 MS-64: 23 MS-65: 0

This data shows that the 1891-S is easily obtainable in MS-63, somewhat scarce in MS-64 and extremely rare in MS-65.

If a collector were to ask my advice what the BVG is for the 1891-S I would unhesitatingly advise him to pursue a nice, high end MS-63.

To my way of thinking, there is nothing especially exciting about this date. If you are collecting Type Three double eagles by date, you need an 1891-S to complete your set but it is unlikely that I will be called by a single collector this year who just happens to be looking for an example. So, right off the bat, this issue lacks the "sex appeal" factor that the 1891 double eagle has.

A look at the price levels for this date are interesting. An MS-63 can probably be bought in the $1750-2000 range, an MS-64 would be at least three times that amount and an MS-65 (if available) might cost ten times the amount of an MS-63.

The population data above tells me that this coin is available enough in MS-64 that I would not want to pay $6000+ for one. And the possibility always exists that one or more of the coins currently graded MS-64 could be upgraded to MS-65. The first PCGS MS-65 example that is graded will, no doubt, command a strong price from a collector or investor who is sold on its status as a "finest known" piece. But what happens to the value level of this coin when two or three other MS-65's are graded?

I also believe that there are certain coins which it always makes sense to stretch for. A good friend of mine has a theory that the most desirable issues are those whose essence can be summed up in fifteen words or less.

An example of this is the 1861-O double eagle. Here's how I would distill the essence of this coin to a new collector: "A rare, historic issue with a strong possibility of having been struck by the Confederacy."

A little background research shows that the 1861-O double eagle is rare in all grades with an original mintage figure of just 5,000. It is probably unknown in Mint State and very scarce in all AU grades. Most interestingly, a number were produced by the Confederacy in the Spring of 1861, after the New Orleans mint had been seized.

According to the 2/28/00 issue of Coin World Trends, the price levels for better quality 1861-O $20's are as follows:

AU-50: $6,500 AU-55: $13,800 No trends value is listed for any grade higher

As of 2/00, PCGS had graded seven examples of this date in AU-50, seven in AU-53, three in AU-55, two in AU-58 and none better.

Now let's say a collector of this series is suddenly offered the chance to purchase two really nice 1861-O double eagles. One is an AU-55 that is priced at $12,000 while the other is an AU-58 that is priced at $17,500. Which coin is the better value?

In this case, I would strongly advise him to purchase the AU-58. To me, this is an easy choice. The price spread between the AU-55 and the AU-58 is not unreasonable. There should be a discernible difference in quality between the two coins. The AU-58 would be tied with just one other coin as the finest graded by PCGS. And, this is a very desirable, truly rare issue with a level of demand that extends beyond specialists within the series. All of these factors combine to make this a logical purchase.

What if the same collector were suddenly confronted with a fantastic, newly discovered 1861-O double eagle that had been graded MS-62 by PCGS and was clearly the finest known by a mile? Would this be a coin that he should stretch for?

It is always very hard to determine a value for coin such as this. But let's say that after careful reasoning, the collector and the dealer who owned the coin agreed that it should be priced at $45,000.

Clearly, $45,000 is a lot of money to pay for an 1861-O double eagle. It would represent a world record price for this date. In my opinion, this would be an instance where a stretch would make sense.

As discussed above, the 1861-O is an issue that passes the "fifteen word test" with flying colors. The finest known example of this date would be a coin that would appeal not only to specialists but to any collector of rarities as well. The price level of $45,000 is not way out of line with the value for an AU-58. And, presumably, this MS-62 coin would be vastly more attractive than the aforementioned AU-58.

There are circumstances that might make this coin a bad deal. For example, its overzealous owner might originally price it at $85,000. At five times the price of an AU-58, this would not make sense. Or, the coin in question might be unappealing and, in the opinion of the collector, not all that much better than the AU-58 he already owned. In this case, the coin should be passed on at the inflated price and maybe even at the more realistic price of $45,000.

The Best Value Grade theory can be applied to all issues of United States coins. Every time I purchase a coin for my inventory, I do a quick BVG calculation. The immediate questions I ask myself are: does the value that this specific coin make sense to me and does this coin offer good value for my clients? I would strongly suggest that before you decide to specialize in an area of make any significant coin purchase that you make your own BVG calculations.

If this theory intrigues you and you'd like to know my thoughts on the Best Value Grade for the coins that you collect, please e-mail me at dwn@ont.com.

The Ten Rules of Successful Coin Collectors

If you do not learn how to become a good coin collector, you will not enjoy this hobby. This will become quickly apparent; especially the first time you have your rash, uninformed purchases looked at (and, probably, summarily dismissed) by a knowledgeable dealer or collector. There are a number of rules that all coin collectors should remember every time they make a purchase. Here are ten that I feel are especially important. 1. Education

The most successful coin collectors take time to learn as much as they can about numismatics. They not only study coins but the dynamics of the market as well. To learn about coins, I strongly suggest that you buy and read as many books as possible. You can supplement these books with specific catalogs that relate to your chosen field of specialization. A serious collector might even go as far as creating a database of prices that relate to his specialty. Other suggestions for new collectors include subscribing to periodicals such as Coin World and Numismatic News. You should join the American Numismatic Association and use their library (they will send books by mail to members). Become friendly with other collectors and communicate with them by phone or e-mail. And don't be afraid to ask questions.

2. Specialization

It is too hard to begin a coin collection without having goals and boundaries. I have always been a strong believer that it is better to view numismatics with a "micro" perspective as opposed to a "macro" perspective. As an example, if you start by collecting Charlotte gold coinage, your "world of focus" becomes 52 specific issues. It is realistic to assume that an intelligent individual who is willing to commit time to this area of study could become relatively knowledgeable within a year or two. To become similarly knowledgeable in a larger field of study (such as all branch mint US gold coins produced between 1838 and 1907) requires many more years. Becoming a well-versed specialist will allow you to level the playing field between you and dealers and it should enable you to make better purchases.

3. Patience

We live in an era of immediate gratification. New collectors often have the urge to jump in very quickly and complete their sets as fast as they can. The best coin collections are built over the course of many years. Sometimes, it is possible to purchase a number of great coins in a very short period of time. But most times, the opportunities to purchase great coins are few and far between. The new collector should avoid the temptation to buy the "wrong coin" just because he needs it for his set and he does not want to wait. Impetuous decisions are invariably incorrect and usually prove costly over the course of time.

4. Connections

It amazes me how many serious collectors get their "meatiest" information on topics such as pricing, market conditions and future trends from such third-hand sources as newsletters, coin magazines and coin brokers. This information is almost always well out of date and totally biased. (Remember that most newsletters which recommend specific coins are written by dealers who have taken a position in what they are touting). The only way to get real information about the coin market is from a dealer or collector who regularly attends shows and auctions. This discounts most coin brokers/salesmen as they get diluted information from their superiors and then pass on these half-baked "truths" to the masses. I personally view it as my duty to pass on accurate information to good clients. Conversely, I will not willing pass this information onto "tire kickers." The best way to get good information is to establish a good working relationship with a well-connected, reliable dealer.

5. Thinking Like A Collector

Anyone who approaches numismatics with a dispassionate attitude is a virtual certainty to lose money. Conversely, most pure collectors make money; often times in spite of themselves. This is because they buy coins for the right reason: they love them. They what interests them and they carefully research their purchases. They know for example, that a coin similar to one they just purchased sold for 10% more at a major auction. They know that they are not buying overhyped coins at the height of a promotional period. They are not buying coins just because a voice at the other end of the phone told them to and they are not buying them because this person told them their new coins would "increase in value 50-75% over the next three years." Remember this rule because it may be the most important one of the ten listed here: learn to think and act like a true collector and you will have more fun now and have a better chance to expect a reasonable profit on your purchases over the course of time.

6. Connoisseurship

I define connoisseurship as the ability to discern true quality in a specific field. In numismatics, the connoisseur is able to determine which coins have the most aesthetic eye appeal and which, literally, stand apart from the "typical" piece. A numismatic connoisseur, for instance, is able to appreciate a truly original gold coin with rich, "crusty" coloration. He is able to innately sense that 150 year old coins do not have to be big and bright in order to be desirable. Connoisseurship is a natural ability. You either are able to naturally determine the "best" or you are not. If you are not a born connoisseur (and very few people are) then you should find a dealer who has this ability to assist you with your purchases. I would estimate that less than 5% of all coin collections are "connoisseur quality" and those that are typically the ones that show the greatest financial appreciation over the course of time.

7. Learning to Grade

I have seen people spend millions of dollars on rare coins without having the slightest idea how to grade. They put their complete trust in dealers and in third-party grading. Frankly, this attitude leaves me baffled. If I do not feel very comfortable grading a specific type of coin, I do not buy it. As an example, I think Indian Head half eagles are extremely hard to grade. To be totally honest, I can't grade the damn things. My solution? I don't buy them. By the same token, I feel that I am a world-class grader of Liberty Head half eagles. So I buy a lot of them. There are some simple rules when it comes to grading. First--and foremost--you need to view as many coins as possible. I would recommend that you attend shows and auctions and carefully look at coins. Secondly, I would take one of the grading classes offered by the American Numismatic Association at their annual Summer Seminars. Thirdly, I would make the decision to specialize, so that you have fewer types of coins to learn to grade. Fourthly, I would try to learn grading tips from the dealer(s) that I buy the majority of my coins from. Finally, I would always remember that while third-party grading is a great safety net for the beginner, there is nothing like your own knowledge.

8. Thinking Long Term

Coins are a terrible short-term investment. Even if you buy coins at a fair "retail" mark-up, you are still paying at least 10-20% over typical wholesale prices. This means that any coins that you purchase has to go up at least 10-20% for you to break even. When coins were heavily touted as investments in the 1980's, the common logic was that you needed to hold at least three to five years. I would suggest that you should plan to hold your coins at least ten years and preferably more. The greatest collections (Eliasberg, Pittman, Norweb, etc.) were built over the course of fifty+ years.

9. Quality Not Quantity

Let's say that you have a coin budget of $20,000 per year. I would suggest that you purchase four or five really nice $4000-$5000 coins each year than twenty $1000 pieces. The coin market of the future will be even more predicated on quality than it already is. High quality coins will become harder to find and, consequently, more expensive. The decision to purchase the best coins you can afford will prove to be very intelligent over the course of time. A few years ago, another dealer had an advertising campaign that basically said that your entire collection should be able to fit into a PCGS shipping box (i.e., it would be twenty coins). While this never really caught on, I think his idea actually has some merit. If you have decided to be more of a "generalist" buyer than a "specialist," I like the concept of having a small collection of great coins instead of a large collection of nondescript coins.

10. Buying the Best You Can Understand

If you are new to coin collecting and you know next to nothing about coins and the coin market, you have no business purchasing $10,000+ items. I would strongly suggest that you start small and take at least three to six months to study the market. Once you feel more comfortable, you can take a bigger plunge into the coin market.

Conclusion:

The regimen that I have discussed above is not easy to follow. Most people are not willing (or able) to follow this approach as it requires considerable discipline and a major commitment of time. If some of these steps seem practical to you and others do not, then I suggest you follow what you can and keep the other steps in the back of your mind as you become better acquainted with numismatics.