Two Sales, Three Coins, One Opinion: One Dealer's Quick Take on the ANA Auctions

The ANA week has never been easy for a small numismatic firm like mine to handle, and when I learned that this year’s version included not one but two companies’ auctions I let out an audible groan. This was repeated when I saw the offerings online: both Heritage and Stack's Bowers had impressive sales, and I would need to carefully view them.

I booked flights to Orange County and Dallas to view the sales in person and at my leisure. One thing I have learned about auctions is that viewing conditions have to be ideal. For me this means the following: my special coin lamp, my music played loud over headphones, no distractions, and plenty of time to take notes on the coins I’m most interested in. I can’t do this at a coin show as, by then, my nerves are frazzled and I can’t properly concentrate. And when I don’t pay full attention, I make mistakes. In my level of dealing, a small mistake can equate to thousands or even tens of thousands of dollars so I want to be cautious, careful, and critical.

The sales were very successful for me. I spent in excess of $2 million dollars including a record-setting purchase of the ultra-rare 1861 Paquet double eagle. (But that’s another story.) The tale I want to tell here is about three coins which I have chosen for what I believe to be their overall level of interest to gold coin enthusiasts.

1. The One I Got at My Price

Lot 11077, Stack's Bowers. 1804 Small 8 over Large 8 half eagle, PCGS AU55, Old Green Holder.

A good client of mine has been searching for the “right” 1804 half eagle for the better part of two years. We’ve bid on a few at auction and always come up just a hair short; on others I’ve put the kibosh to the coin due to quality issues. The above referenced coin, after I saw it in person, was exactly what this collector would want and I knew it was a coin he would be excited about.

After we discussed it on the phone, we debated the value. I told him it was a coin I would gladly bid $10,000 on to stock it for my inventory. We decided to go to $11,000 in the sale, and I was told, “Don’t let this one get away.”

The coin opened at $9,000 and another floor bidder jumped in at $10,000. I bid $11,000 and waited to see if my bid would be topped. After a long pause, it wasn’t, and the coin was mine.

The collector texted me about fifteen seconds after the lot had closed and asked, “Was that our bid?” When I told him it was, I got back a short but rewarding text: “YESSSS!!!!!!!” He was happy, I was happy, and the coin now has a great new home where it will be appreciated for years and years.

2. The One I Ripped

Lot 12010, Stack's Bowers. 1854-S double eagle, PCGS MS64, ex SS Central America.

I’m going to be honest. It took me longer to “like” the SSCA coins than most gold coin experts. I had trouble with the coins due to the conservation and the lack of “originality.” But as time has marched on, I have come to like these coins, and certain coins from this wreck really excite me. This 1854-S was one coin that truly floated my boat.

This specific coin was the single finest of only 25 examples of this date found on the S.S. Central America. In addition, the 1854-S is a condition rarity in the Type One double eagle series, and it is desirable as the first double eagle from the brand new San Francisco mint. Not to mention the fact in person this coin was outstanding; quite possibly the best 1854-S double eagle I had ever seen and clearly finer, in my opinion, than the PCGS MS65 which sold for $115,000 in the Heritage 10/08 auction.

With this information at hand, I decided that I would bid up to $80,000 hammer on this coin and I might even stretch a bit if I had to. The coin, it turned out, was reserved by the consignor at $57,500. This meant that a $60,000 bid was required for a potential sale. The auctioneer opened the lot, I bid, and in a matter of seconds, it was hammered to me at $60,000, meaning I purchased it all in at $70,500. I considered this to be an excellent purchase and I grinned quietly, waiting for my next lot to come up in a few minutes.

3. The One That Got Away

Lot 4120, Heritage. 1865-S double eagle, NGC Improperly Cleaned, Uncirculated Details.

I don’t generally buy “problem coins” and I never, ever, ever doctor said pieces, but this lot was a really big riddle to me. It was the first and only truly Gem example of this date that I had ever seen except for one big problem: it had been lightly cleaned around the date years ago. Without this cleaning, this was a slam-dunk MS65 and, as an example with original surfaces (i.e., not from the Brother Johnathan or Republic shipwrecks) it could easily be worth $50,000++.

I had a dealer friend who is smarter than I am about such coins look at this and he agreed with me that it was a “no grade” now and likely a “no grade” in the foreseeable future. Still, I was haunted by this coin, and I threw in a bid of $5,000 just for the heck of it.

The coin wound up bringing $11,162.50, and I can guess which dealer bought it even without knowing the answer. I will be on the lookout for this coin in the near future and I won’t be shocked if it is in a “regular” MS65 holder and priced at some crazy number.

So there you have it: two sales, three coins, and one very tired dealer’s opinions. I greatly enjoyed my participation in both of these sales, and thanks go to Stack's Bowers and Heritage for putting on such a great group of coin auctions.

Do you buy rare gold coins?

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

1825/4 Half Eagle

Lost amid the hoopla of the recent Baltimore ANA and the numerous auctions that accompanied this show was the sale of one of the greatest United States gold coins in existence. Even more remarkable was the fact that in this day of “ho hum, another million dollar coin just sold,” this sale received relatively little publicity and the final price realized was, in retrospect, pretty reasonable, all things considered. There are two distinct varieties known of the 1825 half eagle. The more available is 1825/4 Unevenly Spaced Date (Bass-Dannreuther 1) which, for many years, was known as the “1825/1.” Recent research has shown that the underpunched digit is, in fact a 4 as it is positioned at the same angle as found on the 1824 half eagle.

The second variety of 1825 half eagle (BD-2) has always been known as an 1825/4 overdate but it is more properly termed the 1825/4 Evenly Spaced Close Date.

For many years, the 1825/4 BD-2 half eagle was regarded as unique. The discovery piece was originally in the Col. Mendes Cohen collection and it was eventually sold to Louis Eliasberg after stints in the Earle and Clapp collections. In the 1982 Eliasberg sale, the coin was cataloged as Proof-60 and it sold for $220,000. I have never personally seen the Eliasberg 1825/4 half eagle but John Dannreuther states in his book on early gold that, in his opinion, it is not a Proof.

In 1978, a second example of the 1825/4 BD-2 half eagle turned up and this story of its discovery is almost as fascinating as the coin itself. In the early part of the 20the century, a collector named N.M. Kaufman was an active (but little known) purchaser of early gold rarities. His collection was exhibited at the Marquette County Savings Bank. Unfortunately, the curator of this exhibit was clearly not a savvy numismatist as he mounted them to a board using tacks (for those of you who just passed out after reading this, I will pause for a second...) Many of the Kauffman coins suffered rim damage from this procedure, ranging from very minor to rather severe.

The Kaufman example of the 1825/4 BD-2 half eagle was sold by RARCOA in their famous August 1978 auction where it realized $140,000. It later brought $148,500 in the B&M 3/89 auction and in 1992 it sold in another B&M auction for a very reasonable $105,600. The last time the coin sold it realized $241,500 in the Superior 2/99 auction.

The coin itself was housed in an old NGC holder and it appeared to be considerably better than its current AU50 grade. However, I’d be careful cracking it out if I were the new owner as the rim marks from the aforementioned display at the Marquette Bank will become more visible if the coin is unencapsulated (this is not intended to scare the new owner of the coin—in looking at the photo of it in the Kaufman catalog, it appears that the tack marks are minor and limited to the upper obverse and corresponding reverse. I have personally seen—and owned—coins from this collection that had significantly more visible tack marks).

Given the rarity of this coin (one of only two known) and the fact that it brought close to a quarter of a million dollars all the way back in 1999, I expected that this coin would be the object of considerable bidding and that it had a legitimately good chance to break the million dollar barrier.

The reserve for the 1825/4 BD-2 half eagle in the Heritage sale was $550,000. The coin wound up selling to a phone bidder for $600,000 plus the buyers’ fee, for a final price realized of $690,000. Why didn’t such a great coin bring more?

As I studied the history of this coin, there was something I learned that I found to be very interesting. On page 395 of his book, John Dannreuther explained the reason why Harry Bass never bought the 1825/4 BD-2 half eagle (he had at least three chances to do so between 1978 and 1992 and price, of course, was not an object for Harry...). Bass regarded this issue as a variety and he was not willing to pay an “excessive premium” for this particular variety.

The more I thought about this, the more sense it made to me. Bass realized before nearly anyone else that there was no such thing as an 1825/1 half eagle. Keeping this in mind, he already had a superb 1825/4 (the BD-1 variety that is plated in the Dannreuther book and which is regarded as a one-sided Proof). The bottom line is that he had an 1825/4 half eagle and a hell of a nice one at that. Given this fact, why pay such a large premium for what is technically a variety?

But not everyone is as sophisticated as Harry Bass and the 1825/4 BD-2 half eagle in the ANA seemed to me to be the kind of coin that would sell for “moon money.” I’m certainly not pooh-poohing $690,000 as this is a lot of money but it’s not the $1 million or so that I thought it would bring prior to the sale.

My best guess why it didn’t reach the magical million mark was the fact that it was “only” graded AU50. In order for two Masters of the Universe to go head to head in a bidding Battle of the Titans, my gut feeling is the coin would have had to have been Uncirculated.

So here’s a hearty congratulations to the new owner of this fantastic early half eagle. You have purchased a wonderful coin with a great pedigree and a great story and it will, no doubt, become an integral part of your collection. And if the circumstances had been just right, I’m certain that you would have had to pay a lot more for the privilege of owning your extraordinary 1825/4 half eagle!

Heritage's Charleston Collection Sale

In my last blog I wrote about the Husky sale conducted by Stack’s and how a number of early quarter eagles gave a good representation as to the strength in that market. Another recent auction, this one conducted by Heritage, contained an impressive set of Classic Head quarter eagles. This grouping, I feel, serves as a good look at the current state of the high-end market for this short-lived but increasingly popular type. The collection that was sold by Heritage was called the Charleston Collection. It was not complete (it lacked an 1838-C) and it was a little inconsistent as to grade (the common 1836 was only an MS61 and the 1839-C was an AU58 that could have easily been improved while the collector was actively buying). Nevertheless, there were some impressive coins in this group.

In higher grades (i.e. MS63 and above) the 1835 is rare and very underrated. The Charleston coin was graded MS64 by PCGS. I wasn’t totally wild about the quality but it was in an old green label holder and it is one of just two graded MS64 by PCGS with none better. The last PCGS example to sell at public auction was Superior 5/06: 996 which brought $18,975. Given the fact that the Classic Head quarter eagle seems much stronger today than it was in 2006, I expected this coin to bring around $22,500. It sold for $19,550. Had it been a better quality for the grade, I think it would have brought more.

Perhaps the most interesting Classic Head quarter eagle in the sale was an 1837 in PCGS MS64. This was a very attractive coin for the grade and a condition rarity to boot with a PCGS population of three in this grade and only one better (NGC hasn’t graded a single example higher than MS63).

This exact coin had been sold twice by Heritage within the last few years. In the 2004 ANA auction it brought $18,975 and in the January 2007 sale it realized $26,450. Given these prior records and the interest that I felt certain this coin would generate, I was expecting a very strong price; perhaps as high as $35,000-40,000. The final price realized was an exceptional $48,875; a record price for a business strike of this date. Interestingly, the finest known 1837 (the amazing PCGS MS65 Bass II: 305 coin) had only brought $37,950 back in 1999.

Another interesting Classic Head quarter eagle in the sale was an 1839 graded MS61 by PCGS. This date is a major “sleeper” in high grades and it is actually rarer in Uncirculated than such heralded branch mint issues as the 1838-C and the 1839-D. The Charleston: 1806 coin was attractive for the grade with the eye appeal of an MS62/63 but with some old wipe lines on the surfaces. The last PCGS MS61 example to sell at auction had been the B&M 6/03: 1510 coin that went very cheaply at $6,038. Given the fact that the population of the 1839 in PCGS MS61 is just two (and only one coin, an MS62, is higher) I expected that this coin would bring at least $10,000 and probably a touch more.

The 1839 quarter eagle wound-up selling for $12,650 which is a record price for a business strike of this date but which, in the big picture, is pretty cheap for a Classic Head quarter eagle that is as rare as this. The finest known remains Bass II: 309 (graded MS62 by PCGS) that sold for a very reasonable $10,925 back in 1999.

Another Classic Head quarter eagle of interest in this sale was an 1839-D graded MS62 by PCGS. This is an exceptionally popular coin given its status as the first year of issue from the Dahlonega mint and the fact that it is a one-year type. I did not care for the Charleston: 1808 coin as I thought it had funky color and a dull, lackluster appearance. Nevertheless, I anticipated that this coin would see some strong bidding. The final price realized was $34,500.

In January 2008, Heritage had offered another 1839-D quarter in MS62; this one graded by NGC. I didn’t care much for this coin either but it brought $34,500. Clearly, this is now the standard for this coin in this grade as the Charleston coin brought the exact same amount.

Lot 1809 in the Heritage sale was an 1839-O graded MS64 by NGC. This coin is tied for the highest graded with four others at NGC and four at PCGS. This was an attractive coin with good luster and color and it had been sold by Heritage as Lot 406 in their April 2006 auction for $34,500.

Given the new strength in the market for high quality New Orleans gold (as well as the interest in choice Classic Head issues) I expected that this coin would sell for at least $35,000-40,000. It brought $40,250 which is a record auction price for this date.

So what did I learn from this sale in regards to the Classic Head quarter eagle market? As I expected, the high end of the market is very strong. I thought the price realized by the 1837 in PCGS MS64 was pretty remarkable and I thought the mintmarked coins described above were strong to very strong. My guess is that we will continue to see strong prices in this series for a while although I wouldn’t be surprised if we start to see some softening for the more common dates in higher grades as the levels for these have really shot up.