DWN To Sell the Northwest Collection of U.S. Gold Coinage

Douglas Winter Numismatics (DWN) is beginning 2010 with the announcement that it has acquired a small but impressive group of 19th century branch mint US gold coinage known as the Northwest Collection. This collection is being added to the DWN website (www.raregoldcoins.com) and the complete listing of coins, along with images, is anticipated by Monday January 4th, 2010. I anticipate that at least half of the coins will be listed and described (without images) by the middle of Saturday January 2nd. The Northwest Collection has just a single non-gold coin but its a desirable one: an 1877 Cent graded MS64 RB by PCGS.

A group of New Orleans gold dollars are led by a lovely PCGS MS62 example of the popular 1855-O. This is a one-year type that features the Type Two design.

There are a number of outstanding quarter eagles in the collection. Included in the group are PCGS MS62 examples of the 1840-O, 1850-D and 1855-C (the latter with CAC verification). Also featured is a PCGS MS63 1847-O and a PCGS graded AU53 example of the very rare and popular 1845-O.

The sole Three Dollar gold piece in the collection is a well struck, naturally toned 1854-O graded AU55 by PCGS.

The strength of the collection is a marvelous run of half eagles. These include a PCGS MS63 1841-D Small Mintmark, an NGC AU58 1842-O, a PCGS MS61 1845-O, an 1847-O in PCGS AU53, a stunning NGC MS64 1852-C with CAC verification and a high end 1858-C graded MS62 by PCGS.

Leading the eagles are an NGC EF45 example of the very rare 1841-O. Other nice New Orleans No Motto pieces are included as well.

The double eagles are few in number but include an 1855 in PCGS MS61.

All of the coins in the collection will be available for sale at my FUN table (520 and 522) but collectors will have first shot at them if they visit my website early and often between now and when I leave for the show next week.

For more information on coins in the Northwest Collection, please feel free to contact me via email at dwn@ont.com or you can call me at (214) 675-9897.

Condition Rarity vs. Absolute Rarity

In numismatics, there are essentially two types of coins. There are coins that are condition rarities and there are coins that are absolute rarities. A condition rarity is a coin whose value is primarily derived from its high degree of preservation. An absolute rarity is a coin whose rarity is based more on the total number known to exist than its grade. As a long-time participant in the coin market, I tend to prefer coins that are absolute rarities. Let’s take a look at a few specific coins that easily fall into one of the two categories. Then, let’s take a look at another category (and for my money the most interesting): a coin that is not only an absolute rarity but a condition rarity as well.

Most new collectors buy coins based on condition. This makes sense. They are introduced to coins through mass marketers or they buy modern coins directly from the United States mint. Mass marketers can’t sell absolute rarity for an obvious reason: there isn’t a large enough supply and mass marketing entails selling products on a large scale.

Certain mass marketed coins aren’t strictly condition rarities in the truest sense of the word. A coin that most people would consider to be a condition rarity would be a common date St. Gaudens double eagle in MS65. But this really isn’t the case. A damaged, virtually destroyed Saint has a current market value of around $1,200 while an MS65 is worth $2,500. The 2x value ratio for a Gem is low when compared to the basal value.

A coin that I would consider a classic condition rarity is an Indian Head half eagle. This is a coin that is worth just a bit over $300 in very low grades but over $15,000 in MS65. That’s a 300x value ratio. I appreciate the fact that a true MS65 Indian Head half eagle is a reasonably scarce coin. But I have a hard time attributing this much value to a high grade example, especially based on the fact that the series is not terrifically popular with date collectors.

So what is there to like and not to like about a condition rarity such as an Indian Head half eagle in MS65? What I don’t like about this coin is exactly what turns me off about condition rarity in general: a significant portion of this coin’s value is based on a subjective factor such as one grading point. In MS64, an Indian Head half eagle is worth $3,500. Most collectors would have a hard time telling an MS64 from an MS65 and a number of already-certified MS65 Indian Head half eagles might come back MS64 if they were (re)submitted for a regrade. And if certified grading were to suddenly disappear, you have a very expensive piece of plastic; in this case (pun intended) one that might be the only thing keeping a $15,000 coin from becoming a $3,500 one.

Another thing I don’t like about this coin is a point I touched on earlier. In theory, an MS65 Indian Head half eagle is a scarce coin. If you go to a major show, you won’t see more than a handful and it is unlikely that any will be what I would consider choice for the grade. But the demand for this coin isn't really all that high. It’s a coin that’s rarely mass marketed (there aren’t enough to go around) and type collectors of 20th century Gem gold don’t appear to be extremely plentiful right now. So while the supply is admittedly low, the demand for this type in Gem might be even lower.

A coin does not have to be expensive to be an absolute rarity. Here’s a totally random example: an 1869 half eagle. Only 1,760 were produced and given the fact that the survival rate for Philadelphia half eagles from this era tends to be around 2-3% it’s safe to assume that only 35-50 pieces are known. I’d estimate that at least half of the known coins are either damaged or well-worn, making an accurately graded EF45 to AU50 piece about as nice as most collectors are going to locate.

What’s interesting about this coin to me is the fact that its rarity is not predicated solely on its grade. You can’t buy a ratty, worn-out 1869 half eagle for $300 like you can an Indian Head half eagle. Basal value for this issue is probably around $1,000. This means that any 1869 half eagle that is gradable (i.e., not harshly cleaned or exhibiting major damage) has a value of at least $1,000 or so.

What’s even more interesting about this coin is that is value level does not skyrocket as you go higher and higher up the circulated coin ladder. You can figure that a decent quality AU55 is going to cost you around $4,000-5,000. That is a 4x to 5x ratio over the world’s worst 1869 half eagle, which seems like good relative value to me.

There is one key point that I haven’t made (yet) which is important. While the 1869 half eagle is a coin with true absolute rarity, it is also a coin with limited collector demand. At this point in time, there are few collectors attempting to assemble date sets of Liberty Head half eagles. This lack of demand, obviously, limits the upside potential of this issue.

Let’s choose another example of a coin that is an absolute rarity but one with a higher degree of collector demand. How about an 1861-D gold dollar? This is a coin that is truly rare in all grades (with fewer than 100 known) AND one with a high level of demand. It is admittedly an expensive coin but there always seems to be collectors looking for an 1861-D gold dollar; both at the low end and at the high end of the grading and price spectrum. If I were an investor looking to purchase a $30,000 U.S. gold coin with good long-term upside, I’d personally be more interested in a coin like the 1861-D gold dollar than, say, a 1907 High Relief in MS64.

As I mentioned earlier in this article, there is one final subcategory of coin: one that combines both condition rarity and absolute rarity. Coins like this are far and few between and they form the cornerstones of truly great advanced collections. Remember the 1861-D gold dollar that I just mentioned? An example that graded MS63 or MS64 and which was properly graded and cosmetically appealing would epitomize this high grade/high rarity hybrid. It would be one of the finest known examples of a coin that is rare in all grades. Given the fact that it would probably command “only” a 5x to 6x premium over a very average quality example, the upside potential is apparent.

What's my all-time favorite number one "hyrbid" rare U.S. gold coin? That's hard to say but one that clearly stands out for me is the Bass/Norweb 1864-S half eagle graded MS65 by PCGS. This coin is a classic in every sense of the word: its extremely rare in all grades, the coin itself is an amazing screaming Gem and it is the finest known by a mile. There's not many U.S. gold coins that hit a home run on three of these parameters and this one does.

Preparing Yourself for the FUN Show

Amazingly, the 2010 FUN is a scant two weeks away. If you have decided to attend the show (and I strongly suggest that if you go to just one show all year that this you consider this one) here is a short list of things to consider. 1. Bring a good lamp. Viewing conditions at the FUN show are not optimal and a good coin viewing lamp is essential. Try if possible to recreate the conditions that you use when you view coins at your home or office.

2. Pull the trigger on really cool coins. My gut feeling is that really good coins are going to be in short supply at this year’s FUN show. My best advice is that if you see something that looks really great or something that you’ve wanted for a long time, don’t waffle.

3. Take an hour lunch break every day. The FUN show is huge and it can be a pretty intense experience for the collector and dealer alike. I think it’s a great idea to leave the show for an hour every day in order to eat a good lunch and take a coin break. Some of the worst purchases I’ve ever made at shows have been when I’ve been tired, cranky and hungry.

4. Have a game plan. If you’ve never been to a major show like FUN, it can be really intimidating. There are hundreds and hundreds of dealers and it’s hard to know where to start. Before you go, spend time on the FUN website (www.FUN.org) and make a list of the dealers that you want to see first.

5. Look at auction lots. Even if you aren’t planning on bidding, the chance to see some of the great coins in the major sales is very educational and rewarding. The FUN sale is traditionally among the very best held each year and this year is no exception.

6. Come as early in the week as you can. Many dealers (not me...) get to Orlando almost a week before the show starts and between the pre-shows, pre-auctions and pre-show hotel room trading, they are burned-out by the time the show opens to the public. I’d say if you aren’t getting there until Saturday you are coming too late. Try, at the very least, to be there on Friday when the show opens.

7. Be safe. There have been a number of robberies after the FUN show ends and you need to remember to be safe. Don’t travel with a lot of cash, don’t display your coins outside of the show, don’t discuss your purchases among strangers and, if possible, have your expensive new purchases shipped to your home/office after the show.

8. Call your favorite dealer(s) before the show starts. Remind them what you are looking for and to hold any important coins for you until you arrive. Speaking from experience, there are a lot of distractions at the show and a gentle prod from a collector is a good way to remind me to hold a coin.

9. If you bring your family, keep them off the bourse floor. Hey, coin buying is serious stuff. Do you really need your wife and kids tagging along? The beauty of the FUN show is that the family can spend the day at Disney World while you play in the world of rare coins.

10. Don’t forget to bring pricing notes. Bring your laptop, your specialized books, your price guides, Trends, the Greysheet, etc. You want to be ready when that special coin turns up.

The 2010 FUN show begins to January 7th and if past shows are any indication, this one should be memorable. If you have any questions about the show, visit the official website mentioned above or feel free to email me at dwn@ont.com

As the 2009 Coin Market Comes to a Close, Where Are We and Where Are We Headed?

With the year nearly over, we are heading towards a slow few weeks in the coin business followed by what is certain to be an interesting FUN Show in January 2010. As we close the year out, I thought it would be interesting to look at a few points and ask where we are and where we’re headed. I have been through some odd coin markets (1982-84 and 1992-1994 come to mind) but what we are currently experiencing is pretty much unique. We are seeing a market where coins that were considered unfavorable a few months ago (bullion and semi-numismatic) are now what everyone wants and “real” coins are as hard to find as at any time I can remember.

The demand for generic U.S. gold, especially double eagles, remains as strong as I have ever seen. The premiums are as high as I can remember. As I write this, gold spot is at $1,140 per ounce (after having broken the seemingly unreachable $1,200 barrier last week) and an average quality MS60 to MS62 Saint is trading for $1,600-1,700. This 40%+ premium over melt for a low-end Saint is easily the highest I can recall and I think it’s pretty remarkable considering that you had to beg people to buy the exact sort of coins a few months ago at a 10% premium.

I am beginning to see some profit taking in the generic market and I think this will continue for a short period, possibly evaporating the premiums. That said, with the current sad state of the American dollar and the worldwide demand for gold, I wouldn’t be stunned to see gold break $1,500 in the next few months and a lower quality Saint to be worth close to $2,000 (!)

What about the rare coin market? It is, in its own way, experiencing topsy-turvy conditions not dissimilar to generics. The big difference is that there is good supply in the generic market but very limited supply in the rare coin market.

As I stated above, it is hard to buy interesting coins right now. Let me explain what I mean before this comment is misconstrued. If you collect Very Fine to Extremely Fine type coins or common date Walkers or Indian quarter eagles, locating coins is probably not a big challenge. But if you collect New Orleans gold or early quarter eagles or superb gem gold dollars you are probably finding it very, very hard right now to buy much. Sure, there are a few pieces around that are either terrifically overpriced or ridiculously overgraded (or a combination of both) but I’m guessing most serious collectors haven’t had an easy time adding to their collections in the last year.

The reasons for this appear pretty simple. There was a good deal of profit taking in 2005 and 2006, which brought quite a bit of material on the market but at very high price levels. The people who then bought in at the high levels either had to sell quickly (and at a significant loss) in late 2007/early 2008 or they have just decided to hold what they have and not sell their good coins at a loss. Another thing to consider is that many of the faux-collectors of the mid-decade have come and gone and most of the buyers for coins these days are serious collectors. They like the coins they own and they just aren’t interested in selling the cream of their holdings.

When I am able to buy interesting coins, they are selling well. I have noticed an uptick in demand for virtually all collector-oriented gold issues in the $1,000-5,000 range. Bigger coins seem to be selling better than smaller coins and nothing appears to be selling better than nice $2,000-5,000 Liberty Head double eagles. Yes, I am nostalgic for the days when I was regularly selling a $25,000+ rarities but I am happy to see many new collectors coming into the market and most of them heading towards the gold aisle in the numismatic mall.

Another issue we are seeing right now in the gold coin market is a real problem with price reporting. With bullion prices rising rapidly, price reporting is naturally lagging. This is compounded by the fact that certain rare date gold prices were unceremoniously devalued after one or two low-end examples sold cheaply at auction. Until we see some accuracy in this area, it will keep down the supply of interesting coins re-entering the market.

Speaking of auctions, it is interesting to note that the upcoming pre-FUN, FUN and post-FUN sales appear to be having a harder time attracting consignments than in years past. A few years ago, specialist dealers like me could use the excuse that auction companies were offering very strong competition when we moaned that we were having a hard time buying coins from collectors. Today, even the most formidable auction firms are extending their consignment deadlines in an attempt to gather more high-powered collections and individual coins.

I’ve heard fewer complaints from collectors and dealers about third-party grading in the last few months. Part of this probably has to do with the fact that most dealers are sending in Saints, Saints and more Saints to PCGS and NGC and the services tend to grade these pretty favorably. But I also think that the creation of CAC has helped to check some of the grading issues that existed in the past and I think the services are, frankly, being more careful with what they grade.

So what’s coming in the near future? As I mentioned above, I think the 2010 FUN will be strong but I am anticipating that I will come home with fewer coins than I’d like to. The name of the game in the early part of 2010 is clearly going to be gold and I wouldn’t be surprised if there is some spillover from the generics market into some slightly more exotic areas.

The Evaporation of the Premium Factor in the Carson City $20 Market

One of the many interesting facts about the rare coin business at this point in time is that the focus in the gold market is clearly on generics and semi-numismatic items and, at least for the time being, off many rare coins. How has this shift of focus affected the Liberty Head double eagle market and, more specifically, the market for common date Carson City issues? I look at common CC double eagles as a sort of bellwether for the dated gold market. The most common Carson City issues (such as the 1875-CC, 1876-CC, 1883-CC, 1884-CC, 1890-CC and 1892-CC) are affordable, exist in enough quantity that they are subject to occasional promotional activities and have a good enough background story that they are easy to sell to beginning collectors.

Traditionally, the price ratio for Extremely Fine and About Uncirculated Carson City double eagles versus generic common dates of this design was around two to one for XF coins and around three to one for AU coins.

A year ago, well before the current soaring gold market, a common 1904 double eagle in Extremely Fine was worth in the area of $700-800 and not an easy issue to sell. The same coin in About Uncirculated was worth just a bit more; say $750-850. At the same point in time, an 1890-CC double eagle was worth around $1,400-1,600 in EF and $2,000-2,250 in AU. This meant that the price ratio for the two issues was approximately 2x in EF and 3x in AU.

Today, this premium ratio has changed, primarily due to the fact that the price of gold has risen to nearly $1,200 per ounce and the demand for nondescript bullion-related double eagles is at an unprecedented high. Right now, a 1904 double eagle in Extremely Fine is worth around $1,500-1,600 while an AU is worth around $1,550-1,650. The market for an 1890-CC in these grades has risen as well, just not as dramatically as a seemingly mundane common date.

In Extremely Fine the current market value for an 1890-CC double eagle is around $2,000 while an AU50 is worth in the area of $2,500-2,750. This means a price ratio of about 1.3x for an Extremely Fine and in the area of 1.7 to 1.8x for an AU.

Why have the premiums for the Carson City double eagle(s) evaporated as much as they have? The answer is simple: the demand for double eagles is at unprecedented levels but the buyers of these coins tend to be unsophisticated investors who want anonymous, cheap coins with as small of a numismatic premium as possible. Even the most Carson City double eagle, like an 1890-CC, is still a numismatic coin and it is hard to convince a dispassionate investor that he should pay a 1.3 to 1.8x premium for two little “C’s” on the reverse.

If the price of gold continues to stay at its current level and demand for common issues remains as strong as it currently is, I do expect a small amount of this frenzy to spill over into coins such as Carson City double eagles. It is likely that the marketers who are selling bulk lots of 1904 double eagles in EF and AU are likely to attempt to “up sell” new investors into the rare coin market as these coins provide greater markups and more profit.

At this point in time I would have to say that common date CC double eagles are a pretty good value and if the price of gold continues to rise, it seems like they are a pretty good “double play” that incorporates the value of nearly an ounce of gold with some real numismatic scarcity. It will be interesting to see where the market premium factor for these coins are in another year.

The Rare and Undervalued 1826 Quarter Eagle

In my opinion, the 1826 is one of the rarest and most underrated early quarter eagles. Most every “fact” that is traditionally associated with this issue is incorrect. I recently purchased a lovely PCGS AU55 example (see the photo below) from the Bowers and Merena Baltimore auction acting as an agent for a collector who is attempting to put together a high quality date set of early quarter eagles. It had been quite a while since I had owned a nice 1826 quarter eagle and this inspired me to gather some facts about this issue.

For many years, the 1826 quarter eagle has been called an “1826/5” overdate. This is clearly wrong and there is a very easy way to prove this. The 1825 obverse die employs large stars while the stars on the 1826 are far smaller. In addition, there is no evidence of an overdate when the date is examined with light magnification. I believe there is either some minor recutting or a small die defect. This issue should more properly be called an 1826/6.

The mintage figure has long been reported to be just 760 coins. Given the fact that around thirty or so exist, I feel that this figure is incorrect. It is probable that some of the quarter eagles struck in early 1827 were dated 1826. The actual mintage figure is more likely in the area of 1,250-1,500; possibly as many as 1,750.

One thing that is certain about this date is its rarity. It is the third rarest early quarter struck after 1797, trailing only the extremely rare 1804 13 Stars and the 1834 No Motto. As I stated above, there are an estimated thirty pieces known. Most are in the lower AU grades, indicating that this issue did not see much actual circulation. I am aware of two or three Uncirculated pieces and none of these, with the possible exception of one coin, appears to be finer than MS61.

The finest known 1826 quarter eagle is in the Harry Bass core collection at the American Numismatic Association. It has an incredible pedigree (Garrett 2: 746, ex Appleton, Mickley) and it sold for $75,000 back in 1980 which remains an auction record for this issue. I estimate this coin’s grade to be at least in the MS61 to MS62 range. The second highest price that I am aware of is $69,000 for a PCGS AU58 sold by Stack’s in their November 2008 auction.

I have personally handled one Uncirculated example, a PCGS MS61 that I sold to a specialized early gold collector around three or four years ago. In all, PCGS has graded fifteen 1826 quarter eagles including three in Uncirculated (an MS60 and two in MS61). NGC has only graded seven in all including six in AU58. It is very likely that this includes a number of resubmissions.

To put the rarity of this issue in better perspective, the 1826 quarter eagle is a considerably scarcer coin than the 1796 No Stars or the 1808. It is clearly not a more valuable coin as both the 1796 and the 1808 are distinctive one-year types that are very desirable as such. The 1826 is clearly the rarest of the five Capped Bust Large Size quarter eagles produced between 1821 and 1827. But, the type collector is likely to select one of the more available dates (like the 1825) which means that the 1826 will probably remain undervalued for the foreseeable future.

The Very Rare 1821 Half Eagle

I recently purchased an 1821 half eagle graded AU53 by PCGS and I’d like to share some information about a coin that ranks as one of the rarer numismatic items that I have handled in some time. This piece was Lot 3684 in the recent Bowers and Merena November 2009 Baltimore auction where it realized $112,125 including the buyer’s charge. It is now owned by an East Coast specialist who is assembling a set of early gold by date.

The mintage for the 1821 half eagle is recorded as 34,461 but it seems likely that at least some of the coins struck during this year were actually dated 1820. Today, there are probably no more than 15 1821 half eagles known. Two die varieties exist with two different obverses sharing a common reverse (which is also seen on certain varieties of 1820 half eagle). The more common of the two (BD-1) has the final star on the obverse close to the back curl. The rarer (BD-2) has this star distant from the curl and placed higher up in relation to the back curl.

Why is the 1821 half eagle such a rare coin? The answer, as with virtually all half eagles of this type, lies in the fact that nearly the entire mintage was melted by 1834 after the weight of gold coins were reduced. The old tenor half eagles were suddenly worth more than their face value and this led to wholesale meltings. In the case of some dates (like the 1822) virtually the entire mintage was wiped-out. In the case of the 1821, nearly all of the coins were melted as well but a few of the survivors appear to have been set aside intentionally.

PCGS has graded a total of eight 1821 half eagles. This includes three in Uncirculated: MS62, MS63 and an amazing MS66. NGC has graded seven with three in Uncirculated as well: an MS61, an MS63 and an MS66. The PCGS and NGC populations are virtual mirror images of one another and we can assume that there are a number of duplications. Obviously, the MS66 is the same coin and I believe that the MS63 is the same as well.

There are two superb business strike 1821 half eagles known. One is in the Bass core collection at the American Numismatic Association’s museum and it is estimated to grade MS65 or better. It was obtained from Stack’s in October 1971. The other is the Amon Carter: 659 coin that last sold at auction in January 1984 for $24,200. I believe that it is the one graded MS66 by both services.

Remarkably, there are two Proofs known as well. One is in the Bass core collection and it has an impressive pedigree: Norweb I: 773, ex Farouk, Green, Newcomer, Woodin and Randall. It is estimated to grade PR63 and it brought an impressive $198,000 in 1987. The other is in the Smithsonian collection and it is part of a complete 1821 proof set that has been part of the Mint’s collection since it was placed in the Smithsonian in 1838.

The 1821 half eagle that is illustrated above, as I mentioned earlier, has been graded AU53 by PCGS. It is conservatively graded in my opinion and I regard it as at least an AU55 with some claims to an AU58. It is from the Globus collection and it was obtained by this collector via private treaty (probably from Stack’s) at least three to four decades ago. I have not had the opportunity to perform pedigree research on this 1821 half eagle but I am assuming it can be traced to an auction sale from the 1960’s or 1970’s.

The coin has wonderful coloration with rich orange-gold and medium greenish hues that are accentuated by deep coppery hues at the border. There are a few light marks visible including a small semi-circular scrape to the left of Liberty’s eye.

The all-time auction record for a business strike 1821 half eagle remains $155,250 which was what an NGC MS62 brought the Superior 5/06 sale.

It is always a pleasure for me to handle great numismatic rarities such as this 1821 half eagle in PCGS AU53.

Coins with Character

In 2010, you will see a new slogan on the homepage of my website (www.raregoldcoins.com). Besides being catchy, “Coins with Character” represents a philosophy that guides me as a buyer and which I try to impart to collectors. Let me explain what, in my opinion, this expression means. Before the recent November Baltimore coin show, I sat down and made a list of the sort of coins I wanted to make an extra effort to purchase. These were coins that I didn’t already have in stock and given their popularity and ability to sell it made sense to me to reload.

High on this list were nice, affordable Dahlonega coins in the EF40 to AU55 grade range. My parameters were that the coins were choice, original and, in some way, “special.” In other words, I was looking for coins that spoke to me; coins with character.

After a lengthy search through the various auctions, dealer inventories and private collections that I encountered in my three days in Baltimore, I was able to acquire a whopping total of four Dahlonega coins that I felt had character: one gold dollar, one quarter eagle and two half eagles. Was I surprised that my quest would prove so fruitless? Not really. I was, of course, disappointed. But given my parameters for “coins with character” I wasn’t surprised.

I generally try to purchase coins that I believe are in the top 5% known for a particular issue. This doesn’t means that they are necessarily in the top 5% as far as grade goes. What I am looking for are coins that because of one or more reasons would rank among the most desirable survivors of a specific issue.

There are a number of things that give a coin “character.” These include the following:

-Attractive natural coloration. Coloration is a major factor in valuing copper and silver coins but it has been undervalued when it comes to gold coins. This has never been the case for me. I personally love gold coins with attractive natural hues; especially rich rose, green or orange shadings. Now this does not mean that I like every toned gold coin. I see dark, dirty double eagles from time to time that are unattractive and which, quite frankly, I’d probably dip or bathe them in soap and water if I purchased them.

I readily dislike bright, shiny, “processed” coins. To me, a coin that is bright and shiny lacks soul. I like attractively toned coins because of their individuality.

One of the reasons that I don’t buy as much Proof gold as I used to is the fact that most pieces have been conserved and they all look the same. Here’s what I mean. Take a coin like an 1880 quarter eagle in Proof. Only 36 were minted and this issue’s rarity and relative affordability makes it very intriguing to me. But I’ve passed on the last three that I have been offered because they were all bright, monochromatic and character-free. They were the Stepford Wives of Proof gold. Conversely, if I were offered a Proof 1880 quarter eagle with nice original hazy golden-orange color, I’d almost certainly buy it; even if it were “only” a PR63 with signs of a light old cleaning.

-Uncommonly Sharp Strikes and/or High Quality of Manufacture: As someone who buys and sells quite a bit of early gold (i.e., U.S. gold produced prior to 1834) I am pretty knowledgeable about how certain issues are supposed to look. As an example, most 1796 eagles have surfaces that appear pockmarked. This is mint-made but it means that the majority of 1796 eagles are not very attractive. So when I see a 1796 that has smooth, non-pocked surfaces I get excited. On an issue that is typically seen poorly made, a well-made example has “character” in my book.

I feel the same way about strike although I readily admit that strike is not extremely important when it comes to pre-1900 gold coins. But when I see an issue that is notorious for a poor strike with above-average detail, this imparts character as well.

-Important Provenance: The history and romance of collecting is, in many ways, just as interesting as the history and romance of coins. It means a lot to me that an 1838 eagle or a 1797 quarter eagle that I buy has an illustrious pedigree. I have owned coins that have traceable pedigrees dating back to the middle of the 19th century and I find it very exciting that I am able to add my name to the list of illustrious and not-so-illustrious individuals that might have been in a coin’s pedigree chain.

One of the reasons that I really respect collectors of early copper and Colonials is that they value pedigree more than nearly any other segment of the market. It certainly helps that there have been active collectors in these market areas dating back to the 1850’s whereas in an area like branch mint gold, specialized collection began far later.

Would I pay extra for a coin with a great pedigree? For the most part I would. Of course, a lot depends on the coin. I doubt I’d pay any extra for, say an Eliasberg quarter eagle that was an overgraded common date or even a scarcer date that had been dipped or processed after it had appeared in the Eliasberg sale and which now lacked character.

-Coins That Break the Mold: Every dealer has a list of “pet dates” that he or she just can’t resist buying. For some dealers it might be an issue that triggers a sense of nostalgia. For others it might be a date that they have traditionally bought and sold with ease in the past. A pet date for a collector is more likely to involve his perception that an issue is undervalued or it has important historical associations.

I won’t bore you with the full list of dates that I’m a sucker for (there are lots of them, I’m afraid...) but these are coins that I tend to be a little more lax about when it comes to the Test of Character. As an example, I actually bought a damaged 1864-S half eagle earlier this year. It was the first “problem coin” that I have ever listed on my website and if it wasn’t for the fact that it was so rare, I would be never bought it and listed it for sale.

-Coins with Original Surfaces: I thought I would save the best for last. I like original coins (or at least what I perceive to be original coins). When I say “original” I am referring to coins that appear to have not been dipped, processed or harshly clean in recent years. A coin that I describe as “original” could very well have been cleaned fifty or a hundred years ago but it has subsequently acquired natural second generation that might mask underlying hairlines.

Why do I like coins with this sort of look? It all goes back to the original thread of this blog: they have character. It is hard for me to get excited about a 150+ year old gold coin that is bright and shiny. It is hard for me to pinpoint the exact reason why I prefer the original look but suffice to say I do and I will continue to buy coins with character for my inventory.

What Does An Original Early Gold Coin Look Like?

As you no doubt know, I am pretty obsessive when it comes to "original" gold coins. I like coins that have an appearance that suggests that they haven't been fooled with. I recently bought and sold an early gold coin that, in my opinion, was the epitome of an original piece and I'd like to share a photo and some descriptive information. The coin in question was an 1814/3 half eagle graded MS62 by NGC and later approved by CAC.

There are a few things about the color of this coin that are a give-away for its originality. The first is the glow that this particular hue of coppery-orange shows. It is the result of over a century's worth of toning and mellowing of the surfaces. This sort of color just can't be reproduced by artificial means. When chemicals are applied to gold coins in an attempt to recapture a reddish-orange hue, the result is usually a shade that I refer to as "Cheeto Orange." In other words, the orange is just too intense to look real and there is no gradiation or seperation of the hues.

You may also note that the coloration is different in hue in terms of configuration and intensity on the obverse and reverse. On this early half eagle, there are areas in the obverse fields that are dark and somewhat discolored. I'm not exactly certain what caused this but if I had to guess it would be contact with another source like a coin album or some other sort of sulphur-impregated display. Most recolored coins look similar on the obverse and reverse.

Another thing that I have noticed on original early gold coins is that the color seems to become deeper towards the edges. This isn't always the case but this color scheme is hard to reproduce and many of the coin doctors who play with early gold are not sophisticated enough to know that this is the sort of color that develops of a long period of storage in an album. If you pay particular attention to the reverse of this coin, you will note that the golden-orange hue at the center changes to a deeper reddish-orange at the border. If you experienced at looking at early gold you will recognize this pattern as being "right."

Note as well the underlying surfaces on both sides. There is a good deal of luster and the luster still exists in a circular pattern. When a coin has been cleaned, the luster is generally broken and the natural cartwheel that is found on unadulterated coins disipates. When this 1814/3 half eagles is rotated, the luster swirls and it does not "break up" like it would on a coin that has been cleaned and later recolored. A good giveaway for artificial color is when there is a splotch of deep color in a specific area on the surfaces. This is often applied in an attempt to hide a problem in this specific area.

How unusual is it to find an early gold coin with color like this 1814/3 half eagle? Obviously if this were an everyday experience, I would not be writing a blog about it and showing the image of the coin as a textbook illustration for originality. There are an estimated 100-125 known examples of this date and if I had to guess, I'd say there are maybe ten known that fit my standards of "originality." The number of coins with the degree of eye appeal that this shows is another story and I'd be surprised if more than two or three existed.