Importance of Good Pedigrees

Now, more than ever, people are beginning to realize the importance of a good pedigree when it comes to collecting coins. And the reason why people are paying big premiums for good pedigrees is surprising. Read on and I’ll give you my take on why well-pedigreed coins are suddenly selling for big bucks. As I have pointed out time after time, most of the coins that I see these days are not very nice. They have generally been scrubbed or conserved and very few are original. Which is exactly why people love coins from the great old collections like Bass, Eliasberg or Norweb.

If you know where a coin has been for the last ten or thirty or even fifty+ years (as is the case with most of the coins from the three aforementioned collections) you can state, at least some of the time, that the coin is original and that it has not been doctored. Thus, the Bass or Norweb or Eliasberg pedigree acts as a sort of semi-official “blessing” that the coin is original.

Now, it is obviously not the case that every coin with a Bass, Norweb or Eliasberg pedigree is automatically “good.” I have seen a number of coins with Bass pedigrees that clearly have had their appearance changed since they were originally sold.

If you are offered a coin from one of these sales, one of the most obvious things you should do is look at the original catalog and compare the coin to the photographic image. This may be a problem as far as the Eliasberg gold coins go since the images in this sale (which was held in 1982) are poor-quality halftones that show little detail. But the quality of the images in the Norweb and Bass catalogs are generally good enough to use for comparative purposes.

There is one “dirty little secret” about Bass pedigreed coins that many collectors do not know. When the coins were originally graded and slabbed by PCGS, they were designated as being from the Harry W. Bass Collection. If a Bass coin was broken out of the holder and regraded it would lose this designation at PCGS. That’s why some Bass coins are designated simply as being from the “Bass Collection.” These second-generation Bass coins are generally not viewed with the same enthusiasm as the coins with the original designation. The same holds true for Bass coins in NGC holders that were upgraded from the original Bass sales.

Certain pedigrees may be well known to specialists within certain collecting categories but have little significance outside of these boundaries. As an example, if you collect New Orleans gold coins you are familiar with the Pinnacle collection and would pay a premium for this pedigree. But if you collect 20th century gold, a pedigree that has greater significance to you might be the Duckor or Morse collections. One of the reasons that collectors value the Bass, Norweb and Eliasberg pedigrees so highly is that these are three of the few collections sold during the modern era that had impressive runs of coins across the board.

In the art world, the issue of pedigree has been very significant for years. Smart new collectors realize that if a painting had been in the collection of a prominent collector, it is generally a “safer” purchase that if it has been bouncing around between dealers or auctions. The same is true with coins. If , for example, a 1908-S double eagle with a Duckor pedigree is available for sale, I would generally feel that this is going to be a nicer coin than one with no prior pedigree.

Denver ANA Summary

The Denver ANA Convention can, for me at least, be described in one word: disappointing. I had said, in print, that I thought the 2006 would be a very strong show. What I forgot to factor in when I wrote this was that there would be three pre-show auctions which would siphon off well over $75 million of money that would have ordinarily been spent on the bourse floor. I have already mentioned the ANR sale, so I won’t go into greater detail. I did not attend the Superior sale (I decided to go home for the weekend and this was probably the only reason I was able to make it through a very grueling week of coin trading…) but I heard from a number of participants that coins went fairly cheaply and there were some excellent values to be had, especially on generic issues.

Heritage Platinum night was the final auction before the show began. I thought the selection of rare date gold was one of the weakest in recent Platinum night history. However, there were some interesting pieces that did extremely well. This included a lovely PCGS MS61 1796 No Stars quarter eagle that brought over $350,000. Most of the higher grade Charlotte and Dahlonega coins were bought back by consignors but a superb PCGS MS63 1856-C half eagle brought close to $50,000. Proof gold seemed strong as well which is no surprise given the fact that there was almost no notable Proof gold on the bourse floor.

The most interesting group of coins in the Platinum night sale was a run of Type One and Type Two double eagles from the Wyoming Collection. I purchased many of the higher quality New Orleans double eagles at levels that I felt were not cheap but not ridiculous. I wasn’t shocked by the prices that the 1854-O and the 1856-O brought ($287,500 and $316,250, respectively) as pre-sale Internet bidding was very strong for both of these coins. The highlight of the collection was the 1861 Paquet in PCGS MS61 which is one of just two pieces known. It sold to an Internet bidder for $1,610,000 which is a world record price for any Liberty Head gold coin at public auction.

The show itself began on Tuesday with PNG day. This is usually the slowest day of the show but even by usual standards this year’s edition was tremendously slow. In fact, the convention room was so lackluster and buzz-free that there were times I was very seriously wondering if we weren’t witnessing a Market Meltdown ala the infamous 1980 Central States show in Omaha where a roaring bull market ended with a whimper.

Things picked up somewhat on Wednesday and I thought that Thursday was fairly busy, although not nearly as much so for me as at previous ANA shows. Friday was my best day. I sold a number of expensive coins and met a few very interesting new collectors who are contemplating serious commitments in the arena of 19th and 20th century gold coinage.

For me one of the highlights was getting to see the collection of Bust Quarters formed by the Pogue family. It was on display at a dealer’s table and Brett Pogue showed me the coins individually and discussed their pedigrees. The Pogue collection is probably the single greatest collection of American coins formed during the modern era. I’ve had a chance to see a number of the coins in the collection and I can’t recall having ever seen a piece that was not exquisite. The hallmark of the collection is originality and it was amazing how evenly matched these coins were; with their wonderful coloration and complete originality.

After a week of being at a coin show, I have some observations about the market:

* There is no question whatsoever that the market is now very much a two-tier affair. There are really good coins and there is everything else. If you had really good coins at the ANA, you could ask nearly any price for them and they would sell. If you had boring coins, you had to price them at a good discount to generate any interest.

* This was the hardest buying show I can ever remember. While I did spend well north of $1 million dollars at the auctions, I was amazed at how bone dry the bourse floor was. When it came to deals, this year’s ANA was dry as well. I was offered two very interesting collections. I passed on both; one because I though the price was too high and on the other because it contained too many coins for me to deal with at one time. For better or worse, nearly all of the interesting fresh coins are going into the auctions.

* The quality of the typical Southern branch mint gold coin I saw was atrocious. There are some nice coins out there (I bought a few of them) but most of the Charlotte and Dahlonega coins I saw were overgraded and unoriginal. If you own crusty original C+D coinage, you have something really rare, regardless of date, denomination or grade.

* The market for Three Dollar gold pieces has softened. There were a number of pieces on the market. However, it should be pointed out that many of these were not nice and the really interesting dates in the series (such as the 1858, 1865, 1877 and the low mintage issues from the 1880’s) remained strong. The biggest correction was for higher grade coins (MS64 and better) in the common and semi-common category. MS66 Three Dollar gold pieces have dropped between 20% and 30% in recent weeks but are still worth considerably more than they were two years ago.

* The generic gold market is very soft right now. I would avoid speculating in this area unless you are able to follow pricing on a near-daily basis but it seems like some market areas are pretty good short-term plays right now.

* After getting a little panicky about the market at the beginning of the show, I am able to look at it with better perspective today, especially now that I’ve finally been able to sleep in my own bed for a night. I think we will see some short-term weakness in the market, especially in areas such as generic gold and “uninteresting” coins. But I think the market for really rare and really expensive coins is better now than it’s ever been. As long as the stock market remains flat (and it’s been as flat as a pancake for the last five years) you’ll see a strong market. The clear indicator of a weak coin market will be when stocks rebound and investors pull their money out of coins and go back to stocks.

The Old West Collection of Carson City Half Eagles and Eagles: An Analysis

On August 11, 2006 ANR sold the Old West Collection of Carson City half eagles and eagles. This was the single most important specialized sale of Carson City gold coinage held since the Lang Collection was auctioned by Bowers and Merena in July, 2002. This sale, thus, provided collectors with an excellent opportunity to gauge the current state of the market for high quality Carson City gold issues. On a personal note, this was also an interesting sale for me. The consignor of the Old West collection is a good customer and friend of mine and I sold him all of the eagles and a number of the half eagles in the collection. So I was participating in this sale not only as a bidder but as an interested “friend of the collection” as well.

I. HALF EAGLES

The Old West collection lacked two issues to be complete (the 1873-CC and the 1876-CC) but it did include a number of important condition rarities. My personal observation was that this was a very nice group with some great individual coins but the eagles were better matched, more original and of a generally higher overall quality.

1870-CC PCGS AU58: This was the Bass II: 1170 coin which sold for a strong $69,000 in October, 1999. It is the single best circulated example of this date I have ever seen and it certainly had the appearance of an MS61. My personal feelings about this coin was that it sold for too much in 1999 but that the market had probably risen to the point where it would sell for around the same amount as it had brought seven years ago. It realized $80,500 (note that all prices realized in this article include the 15% buyers premium charged by ANR).

1871-CC PCGS AU58: I purchased this coin out of the Richmond Collection sale in 2004 where it realized $18,400. This is not an easy coin to figure value-wise as there is no Trends above AU50 and very few high grade examples have sold in the past few years. It commanded a winning bid of $27,600 which I thought was a very solid price.

1872-CC NGC AU58: I’m not exactly sure how or why, but high grade examples of this date seem to be everywhere. I’ve seen at least a half dozen AU55 and better 1872-CC half eagles at auction in the past year or so. Some of these are undoubtedly coins that are recycling while others are overgraded examples that were formerly in lower grade holders. Regardless, this date has lost a bit of luster in my eyes but the NGC AU58 in the Old West collection is still among the highest graded. I thought it was nothing special from a quality standpoint and it brought $29,900.

1874-CC PCGS AU58: This is the most common Carson City half eagle struck during the early years of the Mint’s operation but properly graded AU55 and higher pieces are quite rare. I wasn’t all that crazy about this coin but it had a decent commercial appearance and a much better strike than usual. It opened at $12,000 but was bid all the way up to $27,600 which has to be a record price for a circulated example of this date. With AU58 Trends at “only” $25,000 I would assume that the consignor was thrilled with the prices that this coin brought.

1875-CC PCGS AU55: This was a decent coin except for the fact that it had a large, nasty reeding mark right on the jaw of Liberty. It sold for $17,250 which is a little bit more than 70% of Trends. I would assume that the consignor probably broke even on this coin or possibly made a bit of money but it clearly was not one of his best purchases.

1877-CC PCGS AU55: I thought this was a decent, fairly original coin which would bring around $10,000-11,000. But it sold for $17,250 to one of the sharpest “crackout” dealers in the business so I’m assuming that this piece will soon be a bright, shiny AU58.

1878-CC PCGS AU50: This was my least favorite half eagle in the collection. The obverse coloration was artificial and had been applied to cover an old cleaning. Despite this fact, there is no denying the rarity of this date and the Old West coin was bid to a fairly respectable $16,100 which is nearly 75% of Trends. I think if this exact coin had been offered for sale in the regular section of the ANR catalog it would have brought 15% less.

1879-CC PCGS AU58: I had purchased this coin in the Richmond collection sale in an NGC AU58 and paid somewhere in the area of $9,000 thinking it would upgrade to MS61. It never worked for me and I sold it to the Old West collection’s owner for a small profit. This time around, the coin was sold to a savvy collector who paid $12,650. I’m assuming he didn’t buy it to play the upgrade game and if he keeps it in the PCGS AU58 holder he’ll own probably the nicest “slider” example of this date in existence.

1880-CC PCGS MS62: Here was an interesting coin to ponder when considering how the market for high grade Carson City gold has fared since 2000. In May of that year, this lovely example sold in the Bass III auction for a then-reasonable $13,800. In the Old West collection auction, six years later, it sold to the same collector who purchased the 1879-CC for $29,900. While this seems like a stunning increase, I still think this was a good value. It is arguably the second finest known example of the date and it has a superb pedigree (ex: Old West, Bass, Norweb and Melish collections). In today’s market, truly rare coins with great pedigrees such as this are held in high esteem by sophisticated collectors.

1881-CC NGC MS62: I regard this as one of the highlight coins in the Old West collection but it did not meet its reserve and did not sell. Shameless plug: I will have this coin available for sale at my table at the Denver ANA and I would strongly suggest that any serious collector of Carson City gold coinage who wants an unimprovable example of the rarest half eagle from the 1880’s should give this coin careful consideration.

1882-CC PCGS MS62: The 1882-CC is the most common Carson City half eagle from the 1880’s but there are not many pieces out there that compare to this example. It was the second best that I have personally seen and it brought $32,200 which I believe is a record price for this date.

1883-CC PCGS AU58: The rich orange-gold coloration that this coin displayed on the obverse made it uncommonly attractive for the grade but I don’t think anyone looked at this coin as having the potential to upgrade to MS61 if resubmitted. Thus, its price realized of $9,775 is very surprising in my opinion. Trends is $11,000 but I have seen other similar quality examples of this date trade for less money. In an auction environment, however, such considerations are often forgotten.

1884-CC PCGS AU58: Before I sold this coin to the owner of the Old West collection I tried it a number of times to grade higher at both PCGS and NGC. Someone who is better at the crackout game then I am paid $12,650 for this coin and if it works, he’ll have a nice little score. If it doesn’t work, he’ll have a problem on his hands as AU58 Trends is only $10,000.

1890-CC PCGS MS64: This is not a rare coin in this grade but I thought it was an uncommonly nice piece for the grade. It brought $9,775 which I thought was a fairly strong but not ridiculous price given the overall tone of this sale.

1891-CC PCGS MS65: I had sold this coin to the owner of the collection around a year ago for a price somewhere in the mid-$30’s. It was hard to gauge what it would bring in this sale. I thought there was actually a chance it could bring over $50,000 if two deep-pocketed type collectors butted heads, but I also could have seen it bringing in the low $30’s. It opened at $18,000 and there were numerous people bidding until two people remained at $35,000. The final price realized was $43,700 which is certainly a lot of money for an example of this common date but considering it is the only MS65 graded by PCGS I could have seen it selling for more.

1892-CC PCGS MS63: This attractive, original example was a very good value at $5,750. I have seen a few far inferior examples in MS63 holders sell for $5,000 or so and I thought this coin was really PQ for the grade.

1893-CC PCGS MS62: With Trends at $4,000 I expected this coin to sell for around $2,750-3,000. Instead, it brought a very strong $4,600.

II. EAGLES

I had sold the entire group of eagles in the Old West collection intact to its current owner around three years ago. It had formerly been known as the Orange County collection and I had assembled the collection between 1996 and 2002. It included a number of important Condition Census pieces and pre-sale buzz regarding the coins seemed very favorable.

1870-CC PCGS AU55: When I first bought this coin in June 2000, I don’t think more than a handful of people realized its importance. In a nutshell, it is the finest known example of the rarest Carson City eagle. With unattractive Extremely Fine examples of its big brother the 1870-CC double eagle now selling for close to $200,000, this coin seemed to have potential to bring a record price. When the dust cleared, it sold for $115,000; clearly a record price for the issue but still a reasonable level when one considers the big picture. If eagles ever become as popular as double eagles, I could see this coin becoming worth $200,000+ in the near future.

1871-CC PCGS AU55: I always thought this was a fairly mediocre coin for the grade but other people thought it had a shot to come back as an AU58 if it were regraded. It sold for $25,300 which means, basically, that I was wrong and maybe it was actually a pretty decent coin after all.

1872-CC PCGS AU55: I liked the originality of this coin and thought that if it were dipped it would probably windup in an AU58 holder. It sold to a crackout dealer for $34,500 and I would not be shocked to see it offered as a bright AU58 with a $50,000+ price tag in the next few weeks.

1873-CC PCGS AU50: Maybe I’m just too picky but despite this coin’s excellent pedigree, I thought it was not terribly appealing for the grade. I was clearly in the minority as it brought a very healthy $32,200 which is nearly 10% above AU50 Trends.

1874-CC PCGS AU58: Now here was a coin that I did like. A lot. It was fully original with great color and surfaces. I had hoped to place it with a major collector and bid up to $32,000 but was foiled by a dealer who bid $33,000. With its final price realized at a hefty $37,950, this means that the buyer graded this coin at least MS61. It will be curious to see if a “fresh new” MS61 appears on the market soon.

1875-CC PCGS AU53: In the past fifteen years, I’ve bought and sold this coin at least three times. Way back in 1992, I paid $12,000 for it at auction. It brought $32,200 in its most recent sale which is about 15% more than I expected it to.

1876-CC PCGS AU58: This was one of my favorite coins in the collection. I love gold coins with great color and this piece has always appealed to me due to its natural fiery orange-red peripheral hues. I purchased this coin for $39,100 and thought it was one of the better deals in the sale as I expected it to bring 10-15% more.

1877-CC PCGS AU53: I like this date very much and I really liked the coin for the grade (I thought it graded AU55). Apparently, someone else did as well as I was outbid at $27,600.

1878-CC PCGS AU55: No one other than me seemed to find this coin’s price realized of $39,100 to be extremely strong but I think this had to be a record price for a slabbed AU55 example of this date. I didn’t see the coin has having the potential to upgrade so I am assuming it was purchased by a collector as exactly what it was: a nice representative high grade example of a very scarce date.

1879-CC PCGS AU55: It’s funny how market perceptions and values change over time. As recently as five years ago, the 1879-CC sold for more money than nearly any other Carson City eagle. But after a group of really ugly, overgraded AU examples sold at auction in the last few years, Trends dropped and today the 1879-CC is now one of the most undervalued Carson City eagles from the 1870’s. This coin sold for $32,200 which is more than Trends but which still seems to be a good value relative to other less rare CC eagles from this era.

1880-CC NGC MS61: The date run of Carson City eagles from the 1880’s in the Old West collection is probably the best ever assembled. The 1880-CC was a lovely coin with great color and fresh, original surfaces. I thought it had a good shot to grade MS62 and it sold for a strong $18,400.

1881-CC NGC MS64: What a great coin this is. It is the single finest Carson City eagle from the 1880’s, it has a glorious pedigree (ex Eliasberg, Clapp and obtained from a bank by Clapp in 1895) and it is a stunning piece from a visual perspective. I bought it out of the Lang sale in 2002 for $25,300 and upgraded it from MS63 to MS64. I really wanted to buy this coin again and bid up to $60,000 but it sold to a determined phone bidder for $74,750.

1882-CC NGC MS62: Bet you didn’t know that this date is unique in Uncirculated and that the present example, pedigreed to the Lang collection where I bought it in 2002 for $20,700 in an NGC MS61 holder, is one of the most important Carson City eagles in existence. I was able to buy this coin for $41,400 and was thrilled with my purchase as I would have paid considerably more. This great coin now resides in the finest collection of Liberty Head eagles ever assembled.

1883-CC PCGS AU58: I think I charged the owner of the Old West collection something like $6,500 for this coin. It brought $14,950 in the sale. I think he was pretty happy about this…

1884-CC PCGS MS62: Only five or six Uncirculated examples of this date are known and the present example is the second best of these. I thought its grade of MS62 was conservative and I was able to purchase it for $46,000. It, too, will be residing in the finest collection of Liberty Head eagles that has ever been assembled and it certainly will fit in well in this remarkable group of coins.

1890-CC PCGS MS62: While “only” graded an MS62, this coin has sensational color and great eye appeal. Trends is $7000 for an MS62 but this lovely coin brought $10,350 which is almost certainly a record price for the grade. I bought this coin for $3,520 in an August 1995 Bowers and Merena sale and liked it enough that I had kept it for myself for a few years until I sold it to a collector.

1891-CC PCGS MS63: This coin was nothing all that special but it had a nice pedigree (ex Pittman collection) and attractive original color. It brought over $7,000 which is a strong price for a date that typically trades in this grade for $5,000 or so.

1892-CC PCGS MS63: I’m not sure that I’ve ever seen a prettier Carson City eagle of any date or a nicer example graded MS63. Not only did this coin have nearly immaculate surfaces but it had amazing orange-gold color that gave it a “glow” that could only be appreciated if seen in person. I paid $41,400 for it and was obviously buying the coin and not the holder as Trends is all of $10,000.

1893-CC PCGS MS61: Unlike the other Carson City eagles from the 1890’s, this date is very rare in Uncirculated. The example in the Old West collection was among the finest known and I purchased it for $16,100.

The final price realized for the Old West collection was close to $950,000 and this was a significant profit for the owner. It turned out to be a win-win deal for everyone: a happy consignor and many happy collectors who now have outstanding new Carson City gold coins in their collections.

Coin Cleaning

The market’s definition of what is acceptable regarding cleaned coins has evolved considerably over the course of time. When PCGS and NGC were established, the coin market was overrun with problem coins. Whizzing, which involves using a wire brush on the surfaces of a coin to simulate mint luster, had been prevalent in the 1970’s but more sophisticated methods were beginning to emerge. Third-party grading established some basic guidelines regarding cleaning.

In the early days of the two major services, standards regarding cleaning were overly rigorous. Circulated rare date coins with light, unobtrusive hairlines were “body bagged” or were brutally net graded. What the services failed to realize was that a large percentage of circulated rare date gold coins had been lightly cleaned in the past and coins without hairlines were exceptionally hard to find. Standards were changed over the years and today, it is common to see lightly hairlined coins in holders. This does not bother me.

PCGS and NGC’s early decision to be hard on hairlines had an interesting effect on many coins. Certain dealers began using putty or other substances to cover these hairlines so that “no grade” coins could get into holders. As a result, many coins which would be considered gradable by today’s standards were covered with foreign substances. I see coins like this in most every auction and on the bourse floor. In fact, I even buy them on occasion and it is interesting how nice many of them are once the goop on the surfaces has been removed.

I don’t know if there is any scientific formula at PCGS or NGC regarding what is or what is not acceptable regarding hairlines. In my experience, I find that both services tend to be more tolerant of a coin that has light or no hairlines on the obverse coupled with more dense hairlines on the reverse. A coin with noticeable hairlines on both sides is almost certainly not going to be encapsulated unless it is a major rarity (more on this in a second). Deeply toned coins that hide hairlines are far more likely to be encapsulated than light coins on which the hairlines are clearly noted.

There are varying degrees of cleaning and generally speaking, the more harsh the cleaning, the more likely a coin is to be a no-grade. If a coin has been wire brushed or cleaned with a harsh abrasive, this is not considered to be market acceptable. If a coin has been dipped or lightly washed in soap and water, it is considered to be market acceptable and will almost always be encapsulated. (Dipping is a whole story in itself. Is it harmful to a coin’s surfaces? Probably, even if done properly. Do most dealers and collectors do it on occasion? Absolutely.)

There are coins which walk the fine line between being market acceptable and non-acceptable. As an example, many coins have been wiped with jeweler’s cloths over the years. A wiped coin is generally somewhat dull and lifeless but it may not have any actual hairlines—just a “look” that clearly indicates it was wiped. On a common, generic issue, wiping is almost guaranteed to get a coin no-graded. But on a rarer issue or on a piece of early gold, where grading standards may be more relaxed, light wiping may be considered market acceptable.

Cleaning methods have become far more sophisticated in recent years. The gold coins that were in the S.S. Central America and S.S. Republic shipwrecks underwent very sophisticated cleanings in order to make them market acceptable and to remove encrustation caused by a century of exposure to seawater. Many collectors cried foul and complained that these coins should not have been slabbed. I disagree with this. The majority of the coins that I have seen from these shipwrecks have an appearance that is totally market acceptable. And, they are clearly noted on the holder by both PCGS and NGC as coming from a shipwreck.

What I have more trouble with, from an ethical point of view, is when a grading service conserves a coin and does not indicate on the slab that this process has been undertaken. Not everyone is like me who likes dirty, original coins and there is certainly a place in the market for bright, highly reflective pieces. I would just like coins like to be noted as being “restored” so that less sophisticated buyers are made aware of what they are purchasing.

I mentioned earlier that rare dates and types are graded on a different standard than common issues. This has always been the case in the coin market and it will continue to be this way. A 1796 No Stars quarter eagle that has been lightly cleaned at one time but which still has a decent overall appearance is a very desirable coin that will invariably be encapsulated. A 1926 quarter eagle with the same degree of cleaning will most likely not be encapsulated. The former is a $100,000 coin while the latter is worth $200. It makes sense (at least to me…) that the very expensive coin is going to be treated differently than the cheaper coin.

Cleaning and its impact on grading remains one of the most controversial topics in all of numismatics. Clearly, what was acceptable to collectors and the grading services in 1986 changed greatly in 2006 and will, no doubt, be substantially different in 2026.

Importance of Timing When Assembling a Collection

When assembling a collection, timing is truly everything. This goes for when you are in the process of adding to the collection or when you are disassembling it. In this article, I’ll explain how timing will, no doubt, affect you in the assembling of your set. I can’t count the number of times I have said to collectors that their holdings need to be looked at as a long-term endeavor. One of the truly amazing phenomenons of the Internet-driven coin market is that a new generation of collectors believes it is possible to very quickly assemble a set and then, just as quickly, consign it to an auction company and make a nice profit. In a rising coin market this has (sometimes) proven to be possible. But if and when the coin market corrects, I believe that you will see a return to the “old values” of assembling a collection that worked so well for the great collectors of past generations.

If you are assembling a world-class collection, you have to look at your collection as a series of opportunities. By this I mean that you have to be prepared to buy important coins for your set when the right opportunities arise. One of these is what I call the “generational turn.”

A generational turn occurs when an older collector decides that it is time to sell and he puts his coins on the market. This may occur when the collector is alive or his estate may make the decision for him. In a situation like this, it may mean that a number of coins that have not been available for a generation or more are finally up for sale.

For a younger collector, a generational turn may represent the only chance to acquire certain high grade, rare coins. As an example, for many collectors of United States gold coins, the sale of the Harry Bass collection in a series of four auctions from 1999 to 2001 enabled them to acquire a number of very rare coins that had been off the market since the 1960’s or 1970’s. In the ensuing half decade since the conclusion of the Bass sales, many of the coins offered in those auctions have not reappeared. Clearly, these went to serious collectors who were smart enough to know that this generational turn would be their only chance to acquire specific rare issues in high grades.

One reason that it is very important to stay on top of the developments in your field of specialization is to know, in advance, when a generational turn might occur. If you are, for example, very plugged into the demimonde of St. Gaudens double eagle collectors, you might know that Collector X is going to be selling his set of coins in the next six months and that there are at least three or four important rarities in this set that you would really like to own. Having this lead time to prepare yourself financially and mentally to acquire these coins is far preferable to simply picking up a copy of Coin World one day and seeing that this collector’s set is suddenly going to be sold at auction by Heritage or ANR.

Looking at the concept of the generational turn from the other point of view, as an older collector it is always important to pick a time in the market when there are younger, newer collectors clamoring for your fresh material. Now, obviously, no one knows exactly the right time to sell. But common sense dictates that it makes a lot more sense to sell when your area of specialization is “hot” than when no one really cares.

If you go back and study the coin market in the past few decades there are numerous points in time when a seller clearly made a bad decision to liquidate his holdings. An example that comes to mind is the Chestatee collection of Dahlonega gold that was sold in the 1999 ANA auction. There had already been two huge collections of Dahlonega gold sold at auction earlier that year (in the FUN and February Long Beach sales) and by the time the Chestatee coins became available, the market was clearly saturated. As a result, these coins sold very cheaply and the Dahlonega market entered a downward spiral that took a number of years to recover from.

If you have the luxury of deciding on an orderly schedule of dispersal for your collection, choose a point in time when your collection will be appreciated by a younger generation of specialists.

As a buyer, keep your powder dry and make certain that you are ready to be aggressive at the points in time when you are accorded unusual opportunities to acquire rare and/or exceptional items.

Four 20th Century Gold Rarities and the Stories Behind Them

All four of the 20th century American gold types that were produced contain key issues that are very popular with collectors. This article takes a look at four of these: the 1911-D quarter eagle, the 1909-O half eagle, the 1920-S eagle and the 1921 double eagle. What do these four coins have in common? More than you would think. With the exception of the 1921 double eagle, each has a comparatively low mintage figure and is recognized as a key issue within its respective series. Each is very popular with collectors. And all four are relative “late discoveries” among collectors that have only recently been recognized as rarities within their series and have shown price appreciation befitting this status.

I. 1911-D Quarter Eagle

The Indian Head quarter eagle has proven to be one of the more popular of the four 20th century United States gold types. It is a short-lived set with just fifteen coins. Unlike its three counterparts, this series does not contain any impossible rarities and it can be completed in nice Uncirculated grades by a collector of reasonably average means. Because of this series brief duration and its relative ease of completion, it was a natural to be promoted on a large scale. And, unlike with other 20th century coinage, Indian Head quarter eagles have always been available in large enough quantities to make promotion readily feasible.

As soon as the first coin dealer realized that Indian Head quarter eagles were a great set to promote, the status of the 1911-D rose dramatically. Here was a coin that was an obvious candidate to be the superstar of the set. It had the lowest mintage figure by a huge margin and it was a legitimately scarce coin. As the Indian Head quarter eagle series became more and more popular, price levels for the 1911-D ran amuck. Today, many observers (including myself) feel that this is now among the more overvalued United States gold coins.

It is interesting to look at the numbers of 1911-D quarter eagles graded by PCGS and price levels. As an example, PCGS and NGC have graded over 1,200 1911-D quarter eagles in MS63 and MS64. Even assuming that a number of these are resubmissions, that is still somewhere in the area of 600-800 coins. According to the most recent Coin Dealer Newsletter, dealer bids for this date are $20,500 and $29,000, respectively, in MS63 and MS64. By the most optimistic standards, let’s say that there are currently 200 or so collectors and investors assembling high grade sets of Indian Head quarter eagles. That still means that the supply of these coins is generally more than enough to meet the demand. The bottom line is that while I think this coin has a great story behind it, it is wildly overvalued in the middle Uncirculated grades. (In MS65, the 1911-D is a truly rare coin and I think its current value of $80,000++ is legitimate). When and if the firms that are actively promoting Indian Head quarter eagles wind-down their marketing efforts, I can see MS63 and MS64 examples of this date losing a significant amount of their value.

II. 1909-O Half Eagle

The 1909-O has long been recognized as a key issue in the Indian Head half eagle series but its true scarcity in Uncirculated grades was not always recognized. This is true, of course, with most dates in this series. Before grading became as specialized as it is today, collectors who focused on Indian Head half eagles were unlikely to know—or care—if a coin was an MS63 or an MS64 or an MS65. The rarity of these coins in Gem really only became apparent once modern grading standards were applied to United States gold issues in the late 1970’s - early 1980’s.

The 1909-O has the lowest mintage figure of any Indian Head half eagle. In fact, it is one of just three issues in the series with an original mintage of less than 100,000 coins. There were 34,200 struck and this issue was clearly used in commerce as most of the survivors are in the EF40 to AU55 grade range. What is very surprising about this issue is that almost no examples were saved as souvenirs by local collectors or wealthy New Orleans residents who clearly must have found the 1909-O half eagle to be an interesting coin; after all, it was the first example of this denomination to be struck at New Orleans since 1894 and it was the first with the novel new incuse Indian Head design.

By the 1960’s, it was clear that this date was very rare in Choice to Gem Uncirculated and looking at auctions from this era, one sees some comparatively high prices realized for examples of the 1909-O half eagle that were described as Choice. But prices for this date really came into their own in the mid to late 1970’s when high grade rarities reached price levels that went unequalled for many years.

Today, specialists know that the 1909-O is rare in properly graded MS62, very rare in MS63 and extremely rare in MS64. The population figures for this issue appear to be very inflated as witnessed by the current PCGS population of 21 coins in MS64 (in my opinion, it is unlikely that there are more than four or five accurately graded MS64 examples known). There are two or three Gems known including the Eliasberg coin which is now in a PCGS MS66 holder and which is, without a doubt, the single most valuable business strike Indian Head half eagle in existence.

Is the 1909-O half eagle overvalued? I think the current prices that this issue fetches in AU55 to MS61 seem too strong, given the relative availability of such coins and the fact that most are dramatically overgraded. In MS62 and higher I don’t think this coin is overvalued. My reasoning behind this is the fact that the 1909-O is the only Indian Head half eagle that has multiple levels of demand. It is considered desirable by New Orleans gold collectors, one-year type coin specialists and Indian Head half eagle aficionados. These multiple levels of demand ensure that the 1909-O is likely to continue to be one of the key 20th century American gold coins.

III. 1920-S Eagle

Between 1916 and 1929, only one eagle was produced at the San Francisco mint: the 1920-S. This is a coin which is far rarer than its original mintage figure of 126,500 would suggest. It appears that virtually all of these coins were melted and that almost none of the 1920-S eagles that were struck were released into circulation. I can’t recall having seen more than three or four that showed signs of actual circulation (and these were, in all probability, pocket pieces that had been carried as souvenirs).

There are a number of features that are unusual about the 1920-S, besides the fact that it is the only San Francisco eagle of this design struck in over a decade. Most Indian Head eagles are exceptionally well struck and show very strong fine detail at the centers. The 1920-S is the most poorly produced Indian Head eagle of any date. It is the only issue that typically shows pronounced weakness of strike. Many examples are weak on the hair below the word LIBERTY and on the corresponding portion of the reverse. In addition to this, the luster is often inferior and the overall level of eye appeal is inferior to that seen on other San Francisco eagles of this type. I presume that the reason for this is the fact that the people making these coins at the San Francisco mint hadn’t had much practice on any eagles, given the fact that none had been struck since 1916.

The price history of the 1920-S is interesting as well. This was a relatively expensive coin in the 1940’s and 1950’s but its price flattened in the 1960’s and early 1970’s. It became popular again the 1970’s and early 1980’s but when the Indian Head eagle series dropped in popularity in the late 1980’s and early 1990’s, the 1920-S flattened. In fact, prices for this date in almost all grades were remarkably stagnant throughout the 1990’s. It has only been during the past few years that prices have risen, especially in higher grades. As an example, in Heritage’s July 2006 auction, a high end PCGS MS64 example sold for a remarkable $172,500. As a mater of comparison, the last two PCGS MS64 1920-S eagles offered by Heritage brought $41,400 and $55,200, respectively, when sold at auction in 2002 and 1999.

Today, the 1920-S is recognized as the third rarest issue in the series, trailing only the 1907 Rolled Edge and the 1933. Interestingly, the 1920-S has proven to be a far scarcer coin than the 1930-S; a date with which it was historically paired. But third-party grading has shown that the 1920-S is actually not the rarest San Francisco eagle in Gem Uncirculated. This honor belongs to the 1913-S. And another date in the series, the 1911-D, is comparable in rarity to the 1920-S in Gem, if not even a bit rarer.

IV. 1921 Double Eagle

The fourth and final coin in our discussion of 20th century gold issues is the rarest, although it is not necessarily the best known. Although some experts might disagree, I would rank the 1921 as the rarest Philadelphia double eagle of this design. Unlike its closest competitor the 1932, the 1921 is most often seen in the AU55 to MS61 range and it is extremely rare in MS64 and above.

The true rarity of this date was not known to the early generation of St. Gaudens double eagle collectors. Back in the day, the issues that were most actively sought were the mintmarked coins from the mid-1920’s. But hundreds of these were eventually located in Europe and in all grades below MS64; most of these coins are now only moderately scarce. Unlike dates such as the 1924-D, 1925-S and 1926-S, the 1921 was not exported to Europe. The “story behind the story” of the 1921 is very interesting and the true rarity of this date can be better understood when this is discussed.

Two things conspired to make the 1921 double eagle a rare coin. The first was that most of the mint’s production capacity and efforts in 1921 went towards silver dollars. Millions of Morgan Dollars were produced after a near-two decade hiatus and these were followed by the new Peace Dollar which was a complex, hard to produce High Relief design. Secondly, the United States economy in 1921 was going through a post-World War One slump which would continue until the middle part of the decade. Few gold coins were circulating in the early 1920’s and there was not a great deal of demand for double eagles in 1921. As a result, many of the 528,500 1921 double eagles that were struck were melted.

In addition to being rare because of mass meltings, this issue is rare because of the way it was produced. The 1921 is among the worst struck St. Gaudens double eagles and it is generally seen with poor luster. This shoddy level of workmanship meant that most examples were of inferior quality before they were produced. Coupled with the fact that the survivors tend to show heavy marks from rough handling and copious hairlines from numismatic abuse, the 1921 is among the rarest dates of this type in the higher Uncirculated grades.

It is likely that somewhere in the area of 60-80 examples are known. The PCGS and NGC population figures are both inflated with the AU58 and MS62 numbers showing the greatest number of resubmissions due to attempts to garner upgrades. The 1921 becomes an extremely rare coin in MS63 and above. There are probably no more than four to six known that grade MS63 or higher.

In 2005, I had the honor of handling the finest known 1921 double eagle. At Heritage’s Morse sale, my ex-partner and I purchased a PCGS MS66 example for $1,092,500. At the same sale, an MS65 example sold for $805,000 while and MS64 realized $402,500. Today, all three of these coins have been placed in prominent collections where they will, no doubt, remain for many years.

If any other high grade 1921 double eagles become available for sale, I would expect to see them sell for record prices. This is one 20th century issue whose rarity can not be disputed and it seems highly unlikely that any hoard or accumulations of this date are going to appear at any time in the future.

Misc. Reader Questions

was recently asked a few interesting questions by a reader and thought it might be interesting to answer them. In no order, here they are: Q: In auction catalog descriptions, are there certain giveaways that lead you to think the cataloger doesn’t like the coin?

A: A good auction cataloger is like a good journalist: impartial and able to state facts without imposing personal prejudices. That said, catalogers are only human and it is possible to “read between the lines” and figure out subtle hints that catalogers don’t like the coins they are describing. I’ve always thought a good clue was when the cataloger talks about every possible thing except the coin itself. In other words, he mentions the coin’s rarity, its history and its contextual significance but “forgets” to mention what the coin itself looks like. There are other little clues like describing a circulated coin as “bright” or referring to coloration as “unusual” or “smoky” or “hazy.” I’d also beware of instances when a readily visible mark isn’t mentioned. If a mark is mentioned, it generally isn’t that bad. If it is “overlooked” than it is often so bad that the cataloger can’t find a way to nicely mention it.

Q: Why are different gold coins different colors?

A: There are actually two different answers to this question: the classic, “old school” answer and the “today’s market” answer. In the classic sense, a gold coin is a certain color because of the alloy used in its production. As an example, early Charlotte and Dahlonega gold often used Appalachian gold which had a considerable amount of silver included in the alloy. As a result, these coins often display a green-gold color. San Francisco coins used gold from California which had a high copper content which gave the gold a reddish or rose-gold tint. Unfortunately, few circulated gold coins remain that have not been dipped or which have not been recolored. Today’s color gradations are often more a result of the chemical that was used in recoloring the surfaces. As an example, many gold coins are seen with an unnatural tangerine-orange hue which is the result of a certain type of chemical used to recolor the surfaces.

Q: Why are NGC gold coin populations so much higher than PCGS populations?

A: I think there are two answers. The first and more politically correct is that NGC simply grades more rare date gold coins than PCGS does. Many of the major submitters of these coins send the majority of their coins to NGC and, thus, more have been graded. This is especially true with Liberty Head issues. For 20th century gold coinage, PCGS has actually graded a fairly comparable number of coins and, in the case of certain generic issues, they have actually graded more than NGC. I notice a huge difference between populations on rare dates in AU58. I think the reason for this is the combination of the fact that NGC is looser with this grade than PCGS and PCGS has done a better job, especially of late, in cleaning up their population report.

Do you have any interesting questions? Please send me an email and, if possible, I will answer them at some point in the future.

Heritage August Signature Sale Preview

I recently returned from Dallas where I was viewing auction lots for Heritage’s August Signature Sale. Heritage never seems to run out of coins to sell and, as usual, their catalogs were massive. In fact, I am thinking of charging them for a chiropractic visit as a result of a throbbing shoulder courtesy of having to schlep the catalogs through DFW and Portland airports in my now-deformed briefcase. Now that I’m back home, I’ve had a chance to analyze the Heritage sales and thought I’d share my thoughts about the coins that are being sold.

For the most part, I was more impressed with the non-gold in the sale than the gold. One item that really caught my eye was Lot 5055, which is an amazing NGC MS67 1862 Indian Cent die cap. For the most part, I am not a really big fan of errors but this was the error to end all errors. A die cap is caused when a planchet gets stuck in the die and the planchet is repeatedly struck. As a result, this die cap shows amazing detail on the coin itself and a stunning fan-shaped pattern with no less than eight distinct tabs. If I am not mistaken, this piece was in an ANR sale around three years ago but, for whatever reason, it really caught my attention this time. I would not be surprised to see this spectacular piece break the $50,000 mark.

Another coin that was pretty remarkable was Lot 5264, a 1906-S half dollar graded MS69 (!) by NGC. This is the only business strike barber half dollar ever graded this high by either service and the coin was awfully nice. Did NGC get carried away a little with the grade? Probably. Does a finer business strike Barber half dollar exist? Possibly. But, man, was this a seriously lovely coin!

Enough of this non-gold chit chat. You are reading this blog to know my thoughts on the gold coins in the sale. My overall impression was that the quality was spotty. There were some great single coins here and there and a nifty collection of Liberty Head double eagles but I did not find this to be one of Heritage’s more impressive offerings of gold.

It was interesting to compare the coins in old holders (i.e., the ones that were “fresh”) versus the ones that were “maxed out.” An example of a lovely fresh coin was Lot 5417, a PCGS MS61 1796 No Stars quarter eagle. Unlike most of the examples of this celebrated date that have been offered in recent years, this piece wasn’t stripped of its original color and had a lot of luster below its attractive color. But just so you don’t think that I automatically go ga-ga over any coin in an old green label PCGS holder, the next lot, a PCGS AU58 1796 With Stars quarter eagle showed an old cleaning on its obverse and, even by today’s inflated standards, was not really high end for the grade.

I have to mention the NGC PR67 1879 Flowing Hair Stella because I can’t resist writing the following: it was one Helluva Stella. If I were in the market for a killer example of this type, I’d buy this coin. It was superb.

I was fairly underwhelmed by the rest of the early gold and much of the branch mint issues although a few treasures did poke their little plastic heads up from time to time. You have to begin to wonder, are there any original Charlotte and Dahlonega coins left? Have the coin doctors gotten to every last piece? It was interesting looking at the high grade Philadelphia coins, which had original surfaces and comparing them to their doctored branch mint counterparts. One coin I did love was Lot 5507, an 1856-C half eagle in PCGS MS63. It was easily the finest example of this rare date that I have ever seen.

And, believe it or not, there were some Proof gold coins in the sale with original hazy surfaces (!) I was beginning to wonder if any of these had survived the dipping trays and chemistry sets of America’s coin dealers… If you’d like to know what a piece of original Proof gold looks like, study Lots 5514 and 5516.

For me, the most interesting deal in the sale was the Wyoming Collection of Liberty Head double eagles. I had sold some of the coins in this set to the owner and was excited when I heard his collection was for sale.

The star attraction of the collection is the 1861 Paquet reverse double eagle (Lot 5623). While not really widely known outside of the gold collecting community, this is actually the second rarest regular issue American gold coin, trailing only the 1870-S Three Dollar. Only two examples are known and it will be very interesting to see what this piece will bring. I predict it will bring between $1.5 and $2 million.

The sale includes a full run of New Orleans double eagles including the very rare 1854-O and 1856-O. Both are graded AU50 by PCGS and it will be interesting to see if prices for these two coins continue the amazing upwards march that they have shown for the past five years.

I will be attending the Heritage sale on August 13th and August 14th and would be pleased to provide you with auction representation service. If you are interested, please contact me immediately.

Pricing MS61 Gold Coins

Coin World Trends lists prices for every Uncirculated grade between MS60 and MS65 with the exception of MS61. So, how does one go about figuring a price for a coin graded MS61 by PCGS or NGC? This depends on a numbers of factors: what is the price differential between MS60 and MS62? How rare is the coin in MS61 and in the grades above this? How strong a level of demand is there for the specific date in this grade? And, of course, you must consider that old favorite: what does the coin look like? In other words, is the fact that it’s in an MS61 holder make any difference regarding its appearance versus if it were graded MS60?

The obvious solution to pricing an MS61 would be to take the MS60 and MS62 Trends values for a coin, add them together and then divide this number in half. Let’s pick a coin and try this and see what happens.

I am going to randomly select an 1857-C half eagle in MS61 for this experiment. The Trends value of this coin is $10,000 in MS60 and $20,000 in MS62. Add these two numbers together and you get $30,000, divide this in half and you get $15,000. Assuming that this coin is worth around 70% of Trends, our formula states that this coin should have a retail value of around $10,500.

Now let’s go on the Heritage Auction Archives and see what the last few MS61 examples of this date have sold for at auction. Between January 1998 and the present date, this firm has sold three PCGS MS61 examples for $7,130, $7,188 and $8,912 respectively as well as an NGC example for $8,970. So much for our MS61 value formula and its premise that an MS61 1857-C half eagle should be worth $10,500.

So what is this coin worth? Well, in MS60 Trends is $10,000. Assuming an MS60 is worth 70% of Trends (and I think this figure is high, given the assumption that most MS60 Charlotte half eagles are not very nice coins from the standpoint of appearance), we can state that this coin is worth around $7,000 in MS60. Even though Trends jumps significantly in MS62, there are enough coins graded in MS60 and MS61 to satisfy the admittedly limited demand for this date. My feeling is that an MS61 example of this particular coin should only command a premium of 10-15%, giving it a fair retail value of around $7,700-8,050. And the market seems to agree with this, using the four action appearances cited above as reference points.

Now that we know this formula is a dud, what is a good way to determine the value of an MS61 rare date gold coin? As I mentioned above, there are a lot of factors at hand.

What if a coin has very little difference in rarity between an MS60 and an MS61? An example of this would be an 1887-S double eagle. Now this is a fairly scarce and fairly popular date in a very widely collected series. But it shows a current PCGS population of 39 coins in MS60 and 126 in MS61. The current Trends value for this date is $1,500 in MS60 and I would be a seller in the $1,100-1,300 range. I don’t think an MS61 would command much of a premium at all; possibly a few hundred dollars at most.

What’s an example where a one point increase from MS60 to MS61 could make a significant price increase? Let’s look at a rare coin in a popular series.

The 1856-O eagle is a truly rare coin in Uncirculated grades. PCGS has a population of just one coin in MS60 with none better while NGC shows a population of three in MS60 and none above this. There is no Trends value listed for this issue in MS60 while CDN Quarterly Bid is $13,500. I would be a very willing buyer of the PCGS MS60 example of this date for $15,000; possibly even more if I thought it were nice for the grade. But what would this issue be worth in MS61? Assuming that the coin was solid for the grade, I think it would be a $30,000+ item. Why the huge price increase between MS60 and MS61? It would be a finest known example of a truly rare coin in a series in which there are enthusiastic, deep-pocketed buyers.

I have suggested to the Editor of Coin World Trends that they eliminate the Fine-12 column for gold coins (a grade that many issues do not even exist in) and, instead, add values for the more popular and more often seen MS61 grade. But until this is actually done, the collector will have to use some creativity in determining what an MS61 is actually worth.