1804 Eagle

One of my favorite early United States gold coins is the 1804 eagle. I was recently able to purchase a nice PCGS AU55 example in the Heritage 2008 FUN auction (it’s already been placed in a specialist’s collection) and as I was preparing to ship the coin to its new owner it got me to thinking more about this interesting issue. The 1804 eagle has a reported mintage figure of 3,757 but it is believed that as many as 1,000-1,250 of these were dated 1803 so the actual number of eagles produced with this date may be more in the area of 2,500-2,750.

I believe that there are an estimated 65-75 or so known. This includes around 45-55 pieces in the VF-EF range, 10-15 or so that grade AU and maybe another half dozen that are properly graded as Uncirculated. The finest two that I am aware of are a pair of MS63’s. One of these is an NGC MS63 owned by the Pogue Family while the other is the MS63 (last seen in an NGC holder but it may now be in a PCGS holder) from the Pittman collection that was last sold as ANR 6/05: 1016. The specimen in the ANA Museum (from the Bass core holdings) is also outstanding for the issue and would probably grade MS62 to MS63 by today’s standards.

In comparing the rarity of the 1804 to the other dates in the early Eagles, it is clearly rarer than the 1795, 1797 Heraldic Eagle, 1800, 1801 and 1803. I think it is comparable to the 1796 (perhaps it is very slightly scarcer) but it is clearly less rare than the 1797 Small Eagle and both varieties of 1798.

All examples with the exception of a small number of Proofs (more on these below) are instantly recognizable by having a Crosslet 4 in the date.

Most 1804 eagles are very softly struck at the center of the obverse. This is usually best seen with considerable weakness on the face of Liberty (most specifically Liberty’s chin, lips and the tip of her nose) as well as odd ridges in the obverse fields that resemble swelling of the dies. The example which is shown below is much better struck than usual for the date and the Bass core collection example (which is illustrated in the Bass/Dannreuther early gold book on page 528) is perhaps the most fully struck piece I have ever seen.

More than most other early Eagles, this issue is exceptionally hard to locate with nice coloration and original surfaces. Most 1804 eagles that I have seen have been cleaned and processed and display virtually no originality. In addition, the aforementioned weak central obverse strike makes locating pieces with good eye appeal extremely challenging.

An extremely small number of Proof 1804 eagles were produced around 1834-1835 for use in diplomatic presentation sets. The Proof 1804 Eagles have a Plain 4 and were struck in a close collar as opposed to the coins struck in 1804 which were produced using an open collar. An NGC Proof-65 example of this issue recently sold for a record price of $5 million. It will be curious to see if this price has an effect on values of business strike 1804 eagles, as the sale of the 1933 double eagle raised the price levels on 1933 eagles after the former was sold for a record price a few years back.

After the mint struck eagles in 1804, this denomination was discontinued until 1838.

Despite some strong price increases in recent years, the 1804 remains an excellent value when compared to the more popular and better known eagles from the 18th century. I was very excited to have the chance to handle the PCGS AU55 shown above and hope that I am able to purchase other examples of this date in the near future.

2008 FUN Show Recap

After the dust settles from a major coin show and a major auction, there are always a number of things that can be learned. I learned a lot from the 2008 FUN show and, more specifically, from the Heritage FUN auction.

1. If someone is wealthy and they really want a coin, price no longer appears to be an object. Case in point: the 1805 quarter that was sold as Lot 2775 in the Platinum Night 2008 session. It was graded MS66 by NGC and it brought an absolutely incredible $402,500. What is even more incredible is the fact that this exact coin sold for $74,750 one year ago (almost to the day) in Heritage’s 2007 Platinum Night session. With the click of a mouse, even the most inexperienced collector could have determined this, thanks to Heritage’s unparalleled degree of transparency. Clearly the coin market is strong right now but a nearly-six times increase in the price of a neat but not world-class coin? Gulp. And you want to know something even more amazing about this sale? The two collectors battling it out for the 1805 quarter were bidding on line and, in all probability, never saw the coin in person or had an independent dealer look at it for them. In fact, they may not have even had a bidding strategy other than: “I want this coin and must have it no matter what it sells for.” And this was just one of many prices in this sale that I regard as absolutely amazing.

2. The last time that coins sold for numbers like this at auction may well have been at the 1979 and 1980 Garrett sales. There is one HUGE difference between those numbers and today’s seemingly crazy auction prices. In 1979 and 1980 the end users for most of the six and seven figure coins that were selling at auction were dealers. Today it is virtually all collectors. That makes me think that the coin market of 2008 is a lot healthier than the admittedly twisted market of 1979 and 1980.

3. Heritage has created a model that rich new collectors trust and that they obviously find entertaining to use. Collectors can bid live on their computers even if they are in a hotel room in Kuala Lampur and they know the reserve and/or opening bid level for every coin in the auction. Unlike at most other coin auctions, these collectors know they aren’t going to get jerked around at a Heritage sale and that’s why we are seeing something unparalleled in numismatic history beginning to emerge in 2007 and 2008: exceedingly wealthy people who will never set foot in a coin show and whose identity will never be known to more than a small group of industry insiders are quietly dominating the high end of the market like never before.

4. Previously dormant areas of the market can turn around very quickly. As an example, Proof silver coins from the 1840’s and the 1850’s were extremely tough sales for many years. In fact, I can remember dark, overgraded coins from the Starr sale in 1992 languishing in the market for at least five to eight years and some of the less attractive coins from the Pittman sales taking years to find homes. Out of the blue, these early Proofs are now selling for huge prices. In the Platinum Night session, a group of four very rare Proof quarters (1841, 1844, 1845 and 1850) brought a remarkable $1,322,500 including $460,000 for the 1850 in NGC PR68. Before the auction I would have guessed that these four coins would have brought in the area of $750,000 collectively. From what I hear, there are now two or three deep-pocketed collectors who have suddenly started to put together date sets of business strike and Proof Seated coins. That fact, plus the availability of some very rare and really exceptional issues in the FUN sale created a Perfect Storm scenario and ignited a formerly-dead series. Which formerly dead series will be next?

5. In the area of branch mint gold, it was interesting to see the very strong performance of many issues. The strongest prices realized were for the key date or one-year type issues that have been in great demand for the last few years. In the gold dollar series, a very nice PCGS AU58 1855-D sold for $37,375 (Trends for this issue in this grade is $35,000). The fact that this piece was choice, original and well struck helped propel it to what has to be a record price for an 1855-D dollar in this grade. There were some very attractive 1861-D half eagles in the sale and this is an issue that has shown great demand in the last few years but very few pieces have been available. A PCGS AU58 sold for $43,125 (Trends is just $35,000) and a spectacular PCGS MS63 brought $207,000 which is a record auction price for any Dahlonega gold coin.

6. When I was discussing the “how to” details about the Carolina Circle collection with its owner, one of the most important decisions to make was whether to regrade the pieces that had been slabbed years ago or to leave them as is. Given how hard it is to find a fresh deal these days, I made the decision to keep them in their original holders. Was my choice right? At this early point, it’s hard to say with certainty as you can rest assured that virtually every one of the old holder coins will be broken out of the original holder and sent to PCGS or NGC to be regraded. But given the prices that many of these coins brought, I’d have to say that people are going to have to hit some pretty major Grading Home Runs. Here are just a few examples. An 1841-C $5.00 in an old PCGS AU53 holder sold for $13,800. With AU58 Trends at $12,000 this means the coin will have to grade at least MS61 to be a decent deal. An 1846-C in PCGS AU53 brought $12,650. With AU58 Trends at $14,000 this coin will need to grade at least AU58 and even at that level the dealer who purchased it won’t make any money. A very attractive PCGS AU50 1851-C sold for $12,650 which is considerably more than AU58 Trends. To be even a marginal deal for the buyer this coin will have to grade at least MS60 to MS61. One final half eagle of interest was a lovely PCGS AU58 that brought a rousing $17,250. With MS62 Trends at $15,000 this coin will have to grade at least MS63 to be a good deal. From AU58 to MS63 seems pretty optimistic to me...

7. The appearance of CAC coins in the FUN sale was of great interest to many market observers, myself included. I am planning to write an in-depth analysis of their performance in my next blog but the early results seem pretty strong with premiums ranging from a low of 10% to a high of well over 50%.

Liberty Head Half Eagle Series

Think you know the Liberty Head half eagle series pretty well? OK, then here is a test. Everyone (well, almost everyone...) knows that the extremely rare 1854-S is the rarest single issue in this long-lived series. But what is the rarest collectible date ? The answer and some interesting analysis can be found below. So have you given some thought to this question? If you answered the 1864-S, pat yourself on the back and give yourself a Gold Star because you know your Liberty half eagles! (For those of you who are about to complain and say, “Hey, Doug, how about the 1875?” my answer is that while this date is the rarest as a business strike, there are also Proofs known and the total number of 1875 half eagles is probably narrowly more than the 1864-S).

With a mintage of just 3,888 you have to figure that this is a rare coin. But there are other dates in the series with lower mintage figures, including the 1865, 1869, 1872, 1875, 1876 and 1877. As a rule Philadelphia coins were saved with greater frequency than those from the branch mints and almost no one saved any 1864-S half eagles. My best estimate is that no more than twelve to fifteen pieces are known.

As of January 2008, PCGS had graded just thirteen 1864-S half eagles including three in Extremely Fine, three in About Uncirculated and one in Uncirculated (more about this coin later) while NGC had graded ten with four in EF and three in AU.

In the last decade or so, I have personally seen a very small number of 1864-S half eagles in any grade. The last one I can recall selling at auction was a PCGS EF45 that Superior sold in May 2006 for $22,425 while an NGC EF45 brought $31,050 in David Lawrence’s July 2004 auction. Back in 2000, the Bass III coin, graded AU53 by PCGS, sold for an incredibly reasonable $23,000 and, at the time, that was one of the two best examples I had ever seen. I have also seen an NGC AU58 in the inventory of an East Coast dealer.

There is one 1864-S half eagle known that is so much better than any other survivor that it deserves special mention. I first saw this coin in October 1987 when it sold in the Norweb collection auction. The Norwebs had, in turn, purchased it in 1956 out of Abe Kosoff’s Melish sale.

This coin is in a PCGS MS65 holder but this doesn’t begin to tell the whole story about how incredible it is. The coin is essentially perfect and could easily grade MS66 or even MS67. Its only “fault” is the fact that isn’t all that well struck with some weakness visible on a few of the stars on the obverse and on portions of the upper obverse and corresponding reverse. It is by a large margin the nicest San Francisco half eagle from this era that I have ever seen and when I saw it again at the Bass sale back in 1999 I wrote the following in my catalog “world’s coolest San Francisco gold coin.”

As I was figuring my bids for this sale, the 1864-S kept popping into my mind. I badly wanted to buy this coin for myself or, at the very least, persuade one of my clients to put it away for a few years so I would have access to it when the market for coins like this would be stronger.

The coin opened for $60,000 and I bid up to $120,000 but I got cold feet and dropped out. It wound up selling for $160,000 to a Southern collector who, to the best of my knowledge, to this only owns one San Francisco gold coin—this 1864-S half eagle. And that is a hell of a San Francisco gold coin collection.

What would this 1864-S half eagle sell for today? I thought it would bring as much as $250,000 back in 1999 and had it been in a sale other than Bass II (which had FAR too many great coins for its own good...) it might have. Today, I figure it would bring at least twice this and maybe more.

Despite the obvious rarity of this coin, I think the 1864-S half eagle is still extremely undervalued. The current Trends value for an EF40 is just $14,250 in EF40 and $45,000 in AU50 with no prices listed for higher grades.

The 1864-S half eagle remains one of my favorite 19th century United States gold coins and I am confident that its true rarity will be fully appreciated in the near future.

Winter's Law of Numismatics

I was recently having a conversation with a long-time client about coin investing and our discussion turned to one of Winter’s Laws of Numismatics. Which basically says that the typical coin investor almost never makes money while the typical collector, often in spite of himself, tends to do just fine from a financial standpoint. At DWN, I tend to regard “investing” with a raised eyebrow. If someone who I do not know calls me up out of the blue and starts talking about coin investment, I give him a lecture which basically states that coins are not good investments and that if he insists on looking at coins strictly as investments, he probably should be dealing with XYZ Coins instead of my firm.

But this isn’t totally true. Coins CAN be a good investment. Let’s say that as a knowledgeable collector you went to the Pittman sale in 1997 and spent $50,000 on some nice lots. The chances are pretty good that you would have done just fine from a financial standpoint.

Before we go further, I suggest you re-read the last paragraph. Notice that I said if you had “gone to the Pittman sale in 1997.” This presumes at least three important points. First, that you knew enough about the coin market that you (or an advisor) were able to determine that the Pittman sale contained good coins. Second, you were able to hold on to your coins for a long period of time (hard to believe that the Pittman sale was ten years ago, isn’t it?). And thirdly that you were able to select nice enough coins for them to be “investment quality.”

The trouble with coin investing is that virtually all coin investors buy the wrong coins from the wrong people at the wrong point in time.

When I look at the typical “rare coin portfolio,” I am usually struck by a few things. The coins tend to be very common and very boring; things like common date Walkers in MS66 or common Saints in MS65. Coins like this will never be good investments because they are too common. The second thing I am struck by is that the coins in these portfolios (the very word “portfolio”, when it comes to coins, makes me cringe...) are invariably overpriced. Even coins like MS66 common date Walkers or MS65 common date Saints which have a well-known buy/sell spreads tend to be dramatically overvalued in these portfolios. Another thing I notice is that these common coins are usually bought at exactly the wrong time; usually when a common series is in the midst of a promotion.

Getting back to the point I was making earlier, collectors often make excellent investment decisions even though, many times, they don’t really know they are making them. The smartest things collectors can do are to buy coins that are pretty, coins that are rare and coins that are in demand. An investor is not likely to know which coins qualify as such and the “advisor” that he speaking to likely does not know either.

So as an investor, what can you do to improve the chances that you will actually make some money? My answer is simple: learn to think like a collector. Learn something about the coin market. Realize that coin collecting involves a lot more than checking “past performance” charts and analyzing statistics.

State of the New Orleans Gold Coin Market

I was discussing the State of the New Orleans Gold Coin Market yesterday with a collector and he pointed out something very interesting to me. In the calendar year of 2007, there were probably fewer important high grade New Orleans eagles sold than any other gold denomination from this mint. This got me thinking and the more I looked into this statement, the more I realized that it was true. 2007 began with a bang for New Orleans eagle collectors when Stack’s sold the Morgan collection. Included in this collection were coins such as the only Uncirculated example of the 1879-O (an NGC MS61 that I purchased as an agent for a California collector for a record $52,900) and the third finest known 1880-O (also graded MS61 by NGC; I purchased this for the same collector for $16,100).

After the strength of this sale, I expected the proverbial flood gates to open and a number of important, high grade New Orleans eagles to become available.

Shortly thereafter, I was able to offer the magnificent Pinnacle Collection of New Orleans gold which contained a number of Condition Census pieces in all denominations. With the exception of double eagles which were never a focus of the original owner, the eagles in this collection were probably the weakest denomination, at least from the standpoint of grade. There were some truly lovely eagles in this collection but unlike the quarter eagles and half eagles (which were virtually all MS60 and better and which included numerous coins high in the Condition Census) the eagles were mostly nice, original AU55 and AU58 coins.

After this flurry of activity in January, the New Orleans eagle market was very dry until Heritage offered a small but interesting group of pieces in the ANA sale. Of particular note were the second finest 1882-O (a PCGS MS63) that sold for a record $37,375, one of the finest known 1897-O (a PCGS MS64 that realized $14,950)and the third finest known 1899-O (an NGC MS64 that went for a reasonable $12,663). Another important piece in this sale was a very high end PCGS MS63 1892-O that sold for a record-setting $10,350.

And then...nothing. The year ended with virtually no important New Orleans eagles appearing at auction and this trend appears to be continuing into 2008. Having just reviewed the FUN offerings from Bowers and Merena, Heritage and Stack’s I noticed a virtual absence of any significant New Orleans eagles.

So where are all the coins and why are they not coming up for sale? These are good questions and while I do not have definitive answers, there are a few reasons that I suspect are the root cause.

The first is pretty obvious. Many New Orleans eagles (especially the No Motto issues) are very rare in high grades. When you are talking about a coin like an 1842-O eagle in properly graded Uncirculated, you are looking at an issue with maybe three or four known. Coins that are this rare do not trade with a great degree of frequency.

Especially when we look at reason number two. The New Orleans eagle market is still in its infancy in terms of development and the “players” in this market tend to be buyers at this point as opposed to sellers. This means that many of the really cool pieces that exist are in tightly-held collections and are not likely to be sold at any time soon.

Another not-so-obvious reason is what I call the “spillover effect.” New Orleans eagles have a number of specialized collectors and these individuals are often competing with Liberty Head eagle specialists when important coins come up for sale. I know of at least three collectors who are working on completing high grade sets of Liberty Head eagles. This means that if, for example, a high grade 1846-O eagle were to become available, the New Orleans eagle specialists would be duking it out with the Liberty Head eagle specialists (not to mention the generalists who like interesting coins) creating an unusual amount of competition.

One other reason for the lack of available coins has to do with poor price reporting. I would contend that a coin like the aforementioned high grade 1846-O eagle is worth a lot more today than it was in, say, 2003. But Trends and CDN Bid levels are essentially the same as they were five years ago. Since this very rare coin shows no “paper profit,” what motivation would its owner have to sell it unless he needed money? Until Trends and Bid show accurate values for coins such as high grade 1846-O eagles, the people who own them have no real motivation to sell.

There were a few other interesting New Orleans eagles that sold privately in 2007. I sold Condition Census examples of dates such as 1843-O, 1849-O, 1859-O, 1881-O, 1883-O, 1894-O and 1904-O. I would assume that some other pieces were sold by dealers who specialize in rare gold coins as well.

It will be interesting to see if these market conditions continue for New Orleans eagles in 2008 and beyond. I see a strong new level of demand for this denomination and expect some deep-pocketed new collectors to focus their attention on New Orleans eagles. I just wonder if they will be able to find enough coins to satisfy their hunger.

Charlotte Half Eagle Rarity

As I’ve been working on the updated third edition of my Charlotte book, I’ve had the chance to make some interesting observations regarding the rarity of Charlotte half eagles. The overall rarity of most Charlotte half eagles has changed. In nearly every instance, this has meant an increase in the total number known for a specific issue. As an example, I estimated in the second edition that 70-80 examples of the 1840-C half eagle existed. My revised estimate, in the third edition, is 80-100.

The increased populations are a result of a number of factors. After nearly twenty years of grading Charlotte coins, the PCGS and NGC populations represent significantly large percentages of the known total for every specific issue. So, these population figures carry more weight with me than they did ten years ago (and, yes, I have figured regrades/resubmissions prominently as a factor of total populations from both services).

I believe that my second edition estimates were also a bit on the low side when it comes to lower grade coins. While I knew of nearly every high grade 1840-C half eagle that exists (now or when the last edition was written) I tended to underestimate the low grade coins. My new estimates try to take into account these pieces.

There are changes in the population estimates for EF and AU half eagles because, let’s face it, the EF45 of ten years ago is, in most cases, an AU50 (or higher) today. I’ve tried to factor in gradeflation into my estimates and I tend to discount some of the slabbed AU50 or MS60/61 coins as, in my opinion, they do not meet my personal grading standards.

One thing my updated research has reinforced is that really choice Charlotte half eagles (MS63 and better) remain genuinely rare. While many of the coins listed in the Condition Census of my second book have changed owners and, in many cases, holders, they remain coins with pedigrees that I am able to trace back to the 1990’s or earlier. I’ve also noticed that the grading services have done a good job (most of the time) at holding the line on higher grading Charlotte half eagles. While a few MS63’s have become MS64’s or MS64’s have become MS65’s, many of the coins that were grading MS64 or MS65 back in the mid-to-late 1990’s have remained consistently graded.

The Bass sales, held from 1999 to 2001, had a huge impact on the third edition of the book. Many of the coins that I speculated about in the first two editions but were unaware of their location/grades were in the Bass collection. They now appear in the third edition; complete with accurate pedigrees and current grades.

What are a few other things that I have learned about Charlotte half eagles that will be reflected in the new third edition of the book?

* I’ve learned that some of the die variety information for issues such as the 1849-C, 1850-C, 1853-C and 1854-C was wrong and it has been corrected.

* I’ve learned the value of good pictures and the crappy old black and white images that appeared in the first two editions will be replaced by useful color plates.

* I’ve learned that people generally liked the format and design of my second edition of the New Orleans gold book that I published last year and so this format will be adapted to the upcoming Charlotte book.

* Finally, I’ve learned that Charlotte coinage for me is like the numismatic equivalent of “home cooking” and when I’m feeling cranky or burned-out, nothing is more numismatically soothing than a dose of Charlotte half eagles.

The 1854-S Type One Double Eagle

One of the more interesting and most misunderstood Type One double eagles is the 1854-S. This is an issue whose seemingly high population of Uncirculated coins belies the fact that it is actually extremely rare in higher grades. Read on for some more information about this interesting issue. The 1854-S double eagle is a historically significant coin as it is the first double eagle produced at the new San Francisco mint. Unlike the quarter eagle and half eagle of this year, it is a relatively obtainable coin as one would expect from its original mintage of 141,168. PCGS has graded a total of 148 while NGC has graded a total of 158. In my book “An Insider’s Guide to Collecting Type I Double Eagles” I suggested a total population of 325-425+. I believe that this figure remains accurate.

What is especially interesting about this date, however, is its population in Uncirculated. Looking at the PCGS and NGC populations, one might think that the 1854-S is only moderately scarce. After all, PCGS has seen 52 in all grades of Mint State while NGC has recorded 68.

But the population reports fail to explain an important fact about the 1854-S double eagle: virtually every coin in a PCGS or NGC Uncirculated holder has matte-like surfaces as a result of exposure to seawater.

Seawater Uncirculated 1854-S double eagles come from no less than three sources:

The wreck of the Yankee Blade which sank off the coast of Santa Barbara in October 1854. It is believed that somewhere between 100 and “a few hundred” coins with Uncirculated sharpness were recovered.

The wreck of the S.S. Central America which sank in 1857. It is believed that 20 or so 1854-S double eagles were salvaged from this ship and this includes some with Uncirculated sharpness.

The wreck of the S.S. Republic which sank in 1865. There were eight 1854-S double eagles salvaged from this ship including five that were graded by NGC and three which were “no grades” due to problems. Seawater Uncirculated 1854-S have a matte-like surface texture due to exposure to the oceanic environment in which they rested for over a century. But there are also a few other interesting tell-tale signs that they show.

As mentioned above, the majority of the seawater 1854-S double eagles are from the Yankee Blade shipwreck. These coins (as well as the ones that I have seen from the S.S. Central America) have die cracks on the obverse and the reverse which are easily identifiable. On the obverse, there is a crack to the left of the 5 that runs from the rim to the truncation and which branches off to the right over the 4. Another crack begins at the left side of the coronet and runs up to the space between stars six and seven. The reverse shows a large crack from the first T in STATES out into the field below the UN in UNITED. I have never seen a seawater 1854-S double eagle in any grade that did not have these cracks.

What’s interesting about the non-seawater coins is that they do not show any of the cracks described above.

There are some other minor diagnostic differences between the seawater and non-seawater coins as well. On the former the 54 in the date are very close and the top of the mintmark is firmly embedded in the tail feathers. On the latter, the 54 appears to be less close and the mintmark is a bit lower.

I first learned about the rarity of high grade 1854-S double eagles with original surfaces around fifteen years ago and have searched for Uncirculated pieces for many years. The finest that I have ever seen is a piece that was recently sold as Lot 61779 in Heritage’s November 2007 sale where it brought $21,850; it had earlier been in the Bass collection and it sold for $10,925 when offered as Bass III: 781 in May 2000. The only other example I can recall having seen with claims to an Uncirculated grade was Heritage 1/05: 9473 ($5,175). This coin was in an old holder and it might grade MS60 or better by today’s standards. It is now owned by a collector in Connecticut.

So where are all of the high grade 1854-S double eagles without seawater surfaces? My guess is that a considerable number were melted. This seems more likely when one takes into account the fact that the vast majority of the 325-425+ pieces known lack original surfaces. My best estimate is that only 25-50 are (currently) known from non-shipwreck sources. It is my opinion that these should command a strong premium over seawater coins in all grades.

What Will It Take To Jumpstart The Charlotte Gold Market?

In the last few months I’ve been asked a similar question by at least three collectors: what will it take to jump start the Charlotte gold market? This is an excellent question and I’d like to raise a few points that I think will explain what possible scenarios could affect these coins and the impact that they might have. Before delving into these specific points, I think a little background is in order. Charlotte gold coinage has been in a price and popularity slump for the last five or so years. I attribute this to the following reasons:

There are a lot of really low quality coins in PCGS and NGC holders on the market. When one sells for a low price at auction it tends to drag down the nice examples of this issue along with it.

My book on Charlotte gold coins is out of date and scarce. An updated third edition should be ready by the spring of 2008.

A few of the larger marketing firms who traditionally have sold Charlotte coins (both high end and low end pieces) have shifted their focus to other areas of the rare date gold market.

There haven’t been any really interesting collections of Charlotte coins that have come onto the market for a number of years. Often times, when a neat, fresh collection is offered for sale at auction, this generates new collector interest.

Many of the long-time specialists in this field have completed their sets and are not currently in the process of upgrading. This fact, combined with a relative lack of new collectors, has caused the supply of Charlotte coins to outstrip the demand.

I do not mean to give the impression that the Charlotte market is totally dead because it isn’t. I have personally had a good amount of success selling Charlotte coinage in the past few years but I have become extremely selective with what I buy. I will only purchase choice and original coins and I am probably less willing to make a slight allowance for “off quality” as I am in a more popular area such as Dahlonega gold or New Orleans double eagles. I know for a fact that there are a number of collectors working on VF-EF date sets in all three denominations and I have had a relatively easy time selling any very high quality (MS63 or better) pieces I find which have great color and eye appeal and/or which have a great pedigree.

Now, for some answers.

There is absolutely no question that the Charlotte market is not being helped by the existence of some really piggy coins in holders. I think this problem will be helped by the CAC stickering of nice coins which will generate new interest by collectors and dealers alike. New collectors will be helped by the fact that they can determine which coins are believed to be nice for the grade.

From my experience, a new (or updated) book on any subject generates a lot of interest. I can’t imagine that an improved and easily available Charlotte book won’t get a few new collectors interested. It will probably also motivate a few marketing firms to start selling Charlotte coins as they will have a guide to send collectors and to assist their sales force in making presentations.

The combination of CAC stickers, a new book and available product would certainly be good motivation for said marketing firms to sell Charlotte coins again. This might help remove some of the lower end and very high end pieces from the market which will leave the middle to upper middle end coins for collectors. When the Charlotte market was at its healthiest stage in the 1990’s, strong interest was seen not only in the collecting segment of the market but in the mass marketing segment as well.

In their January 2008 FUN sale, Heritage is going to sell a wonderful, fresh group of Charlotte coins called the Carolina Circle collection. This will be one of the first really important groups of Charlotte coins to be offered at auction since the incomparable run of collections sold at auction between 1995 and 2002 (Pittman, Bass, North Georgia, Miller, etc) and I would not be surprised if this creates a few new collectors.

The economics of any market are very simple. If the demand exceeds the supply, prices go up. Prices for nice EF40 and EF45 Charlotte coins have doubled in the past five or so years because there is a strong collector demand for these. Prices for overgraded, unattractive AU55 and AU58 coins have actually dropped (in some cases considerably) in the past five years because collectors do not want them and demand is—rightfully—very low for said items.

Personally, I think the sweet spot of the Charlotte market right now is nice AU55 and AU58 coins. These are, in most cases, very scarce but premiums are much lower than in the past. As an example, around five years a common date Charlotte half eagle in EF was worth around $800-1,000 while a common date in AU55 was worth $3,000-4,000 (or approximately 4x the price of an EF). Today, the EF is worth around $2,000-2,500 while the AU55 is still worth $3,000-4,000 (or approximately 1.5-2x the price of an EF).

How are problem coins valued?

I’ve discussed many times the process in which how nice coins are assigned price levels. But how are problem coins valued? This is an interesting question and one which is becoming a bit easier to answer since NCS coins have become a well-accepted part of numismatics. (Before I begin, I should state here that NCS or Numismatic Certification Service is a division of NGC that certifies and encapsulates “problem coins” which NGC does not see fit to put in their regular holders. This includes coins that are harshly cleaned, polished, heavily scratched, rim filed, etc. NCS only uses adjectival grades—i.e., they would call a coin “AU details” as opposed to “AU55 details.”)

The reason why non-problem coins are easier to value than problem coins is, well, because they don’t have problems. There is a greater degree of consistency of appearance between an 1830 half eagle in PCGS AU55 (or NGC AU55) than there is with this same issue when it has the details of an AU55 but it has been cleaned.

Let me explain what I mean by this. If you were to call me up and offer me an 1830 half eagle in PCGS AU55, I would have a decent idea of what to expect. I’m figuring that it has light wear, a decent amount of remaining luster, maybe a few scattered marks in the fields and probably a pretty good overall appearance. But if you call me an offer me an 1830 half eagle in an NCS holder that states the coin has “AU details” but has been “cleaned,” I’m not sure what to expect. Has it been lightly cleaned or harshly cleaned? Does it have an acceptable appearance or does it look overly shiny from having been polished or perhaps whizzed?

From my experience with viewing NCS coins, there is a very wide range of coins in these holders.

I’ve seen coins that NCS has called “cleaned” that look pretty acceptable to me; not very different, in fact, from coins encapsulated by both NGC and PCGS. I’ve also seen coins placed in NCS holders that had planchet flaws or mint-made surface that, in my opinion, could just as easily be in “normal” NGC or PCGS holders.

But back to cleaned coins and how to value them. As a general rule of thumb, I think that if a coin has been lightly cleaned it is worth around half of what a non-cleaned example would be worth. The NGC or PCGS AU55 1830 half eagle that I mentioned above is a $60,000 coin if it has a decent, original appearance. In an NCS “AU details—cleaned” holder it’s more likely worth $30,000 or so. And if it’s a very harshly cleaned AU coin with some damage as well it is more likely worth in the area of $15,000-20,000.

This brings me to a philosophical question. Would I, as a collector, want to own a very rare but very ugly coin that costs $20,000 or $30,000? I do not personally like problem coins even though I can understand their value and why certain collectors would want, say, an “affordable” example of a desirable coin like an 1808 quarter eagle. But I would rather spend my $20,000 or $30,000 on a coin that was less rare and more aesthetically pleasing. If my budget for a very rare coin like an 1808 quarter eagle was only $20,000-30,000 I would re-examine the “need” for this issue to be in my collection and would spend the money on something nicer.

Remember what I said above about the varying degrees of “cleanedness” or damage seen on NCS coins? I might actually not mind owning an NCS encapsulated 1808 quarter eagle with VF or EF details that had been lightly cleaned and which had a good appearance. The thing to consider, though, is that many other collectors feel the same way and such a coin might actually sell for a value level not much less than a VF or EF that was in a regular NGC or PCGS holder. The real question is would I want to own an 1808 quarter eagle that looked like it was run over by the proverbial train. And if I did, what would I pay for it?