The 1856-S Eagle: A Study of Mintmark Varieties

I'd like to thank collector John Toffaletti for writing this interesting study of 1856-S eagles and contributing it to raregoldcoins.com for publication. I think you'll find it very interesting and it contains information that has never been published before. There appears to be new interest in the older gold coins from the San Francisco mint. This is especially true for the double eagles, but also for the other denominations.

In searching the eagles from this period, I have noticed that the 1856-S comes in two very different mintmarks: a large S located farther to the right between the arrow feathers and the stem of the right branch and a medium S, located to the left of these same arrow feathers and the eagle’s right claw (left claw as you view the coin).

I started searching the Heritage Auction Archives for this date and mint mark and noticed that the large S was sometimes described as “very rare” because that’s how it was described in Breen’s Complete Encyclopedia of US and Colonial Coins. To me, “very rare” means a coin that is really difficult to find, so I was puzzled when the two most recent 1856-S Eagles in the Archives for April 2011 were both large S types.

Continuing to look farther down, the Archives appeared to confirm that the large S was less common among the images that I viewed: of the first 20, 14 were medium S and 6 were large S. Still, not what I would call “very rare”. However, I was really interested by now, so I continued down the list until I got to 1999, at which point Heritage did not include images in their Archives.

All told, there were 80 1856-S Eagles sold from April 1999 to April 2011, with 55 being the medium S and 25 being the large S variety. So the large S would certainly appear to be rarer by about a 2 to 1 ratio.

Now for the “double S,” as in Steam Ship. I noticed one P55 1856-S eagle had an exceptionally high price for the grade. This was a shipwreck coin from the SS Central America. In a recent article, Doug Winter mentioned that certain shipwreck coins were selling at markedly increased prices relative to their landlubber cousins. Winter noted that the greatest differential was for such coins with low “shipwreck populations”.

As an example, the very common 1857-S shipwreck double eagle sells for a small premium in the middle Uncirculated grades, while most others would sell for a significant premium. Since the large majority of coins found at shipwreck are double eagles, eagles would certainly have low shipwreck populations. Here is a list of the 1856-S shipwrecked coins on the Heritage Archive:

April 2010 N25 SS Republic $1955.00 March 2010 P55 SS Central America $7475.00 May 2008 N50 SS Republic $2990.00 June 2008 N45 SS Republic $1610.00 January 2002 P58 SS Central America $3450.00 (typical 58s sold for around $2600 at the time)

While I much prefer an original, attractively toned coin that survived actual circulation with minimal wear and damage, it is clear that these shipwrecked coins sell for a premium.

Now back to the mintmark search. Breen states that the medium S variety has at least 2 positional varieties. As I looked at the medium S eagles, I noticed that one of the medium S mintmarks really stood out. It seemed to be much lower and to the right than the other medium S’s that I had seen (but still an obvious medium S).

I saved this image and another of the more common medium S coin with the mintmark located in the upper left area. Now able to clearly compare these two images, I confirmed that the two medium S’s were located in distinctly different locations.

The more common medium S is more toward the left and tucked up between the arrow feathers and the left claw, with a line along the right tips of the S pointing almost directly through the left bar of the “N” in “TEN” [for an example, see the coin sold in the Heritage January 2011 auction, graded P58].

On the other type, the right tips of the S point almost to the middle of the same “N” and the top of the S is no higher than the lower tip of the arrow feathers [for an example see the coin sold in Heritage’s April 2008 sale, graded P40].

Also, I felt that another of the medium S marks seemed a little different than the others. Indeed, this third type of medium S variety is somewhat between the other two: the right tips of the S point down to the right of the left bar of the “N” in “TEN” and the top of the S is just above the lower tip of the arrow feathers [for an example, see the Heritage March 2010 coin graded P58 CAC. This same coin was later upgraded to an N61 and sold in the September 2010 auction by this firm].

Breen speculated that the large S eagles may have been the last of three deliveries by the San Francisco mint: Jan 1856: 14,000; Sept: 55,000; Dec 2,500. However, the relative rarity figures of the Heritage Archives do not support this.

Since the 1854-S eagle has a large S, while the 1857-S eagle has a medium S in the lower right position, this suggests that the first shipment of 14,000 were the large S variety. Most of the 55,000 shipment (from September) were the upper left medium S, while the final shipment was the lower right medium S. These numbers are congruent with the Heritage Archive numbers.

The rarest variety appears to be the medium S in the lower right position, followed by the large S, then the upper left medium S. The center medium S is relatively scarce also, perhaps about the same as the large S type.

In closing, I have to tip my hat to Walter Breen, who amassed much useful information about a huge number of coins without the grading service population reports or the great convenience of the Heritage Archives.

How Much Do You Have to Pay to Play?

I get calls from potential new gold coin collectors nearly every day. Some of them have spent a good deal of time researching the gold coin market and have a good idea what the coins that they may be buying will cost. Others have no clue and are almost charmingly naive about what they can buy given their budget. This leads me to the topic of today's blog: how much does a collector realistically have to commit per coin to put together a nice collection of rare gold coins? I've stressed in numerous articles and blogs the importance of specializing when it comes to coin collecting. Collections that are all over the map tend to have "issues" (putting it nicely) and having a greater in-depth focus makes for a better, more productive collector. But a collector's chosen specialty needs to be in sync with his budget.

If a collector calls me and tells me he wants to put together a set of Indian Head eagles on a budget of $1,000-2,000 per coin, my first reaction is that he's not going to get far. Only a few coins in this series can be purchased in this price range and these tend to be either the generic issues like the 1926 and 1932 or relatively lower grade (Extremely Fine and About Uncirculated) versions of the slightly better dates.

This doesn't mean that a collector with a $1,000-2,000 budget can't play in the rare date gold coin market, there are some reasonably interesting coins available.

The collector with a $1,000-2,000 budget needs to make one immediate decision: does he care more about comparatively high grade than rarity?

If the collector with this budget is grade-oriented, there are a number of options that he can pursue.

One nice set that comes to mind are Philadelphia gold dollars struck from 1877 through 1889. This set consists of 13 coins and all of them can be found in MS63 for less than $1,500 per coin. And, if the collector in question wants to step up to MS64 examples, all the dates in this set can be found for less than $2,000.

Once this set is completed, the collector can focus on many other of the gold dollars from Philadelphia. All of the Type One issues from 1849 through 1854 can be had in MS63 for less than $1,500. And many of the Type Three issues from the mid-1850's, 1860's and early 1870's are very affordable in MS60 to MS63 grades.

If the collector on a fairly tight budget is more rarity oriented, the Liberty Head quarter eagle series offers a number of potentially interesting options. Most of the Philadelphia issues from the 1840's are scarce, and nearly all can be obtained in the lower to mid-AU grades for $1,000-1,500.

Many of the Civil War era quarter eagles--from both the Philadelphia and San Francisco mints--offer a great amount of bang for not a lot of buck. Let me pick a random example to illustrate my point. The 1867 quarter eagle has an original mintage of just 3,200 business strikes and it is likely that fewer than 125-150 are known. Yet, when available, a nice AU55 example of this date should cost $1,500-1,750.

The low mintage quarter eagles from 1880 to 1894 are intriguing. With the exception of the ultra low mintage 1881 and 1885, most of these dates can be obtained in the AU55 to MS62 for under $2,000.

There are a number of interesting half eagles that can be purchased for less than $2,000 per coin. This includes many of the No Motto Philadelphia coins in About Uncirculated and a number of the New Orleans issues as well. This includes some interesting dates, such as the 1843-O Small Letters and Large Letters, 1845-O, 1846-O and 1851-O in Extremely Fine.

Speaking of New Orleans coins, is it possible to have a budget of $1,000 to $2,000 per transaction and still purchase the popular Charlotte and Dahlonega issues? The answer is a qualified yes. I regularly handle common date C+D gold coins grading VF35 to EF45 that are priced from around $1,750 to $2,500. You aren't necessarily going to get a coin that is a candidate for beauty-prize winner at the price/grade level but you'd be surprised at the interesting lower grade issues that come available from time to time.

What about larger size coins?

At the $1,000-2,000 it is possible to buy as many as twenty to thirty different No Motto eagles in the EF40 to AU55 range. Most of these will be Philadelphia coins but there are many New Orleans eagles that can be found in EF grades for around $1,500 to $2,000.

Your dollars are going to go much further in the eagle denomination if you stick with the With Motto coins. The issues struck from 1878 to 1907 are readily available in the $1,000 to $2,000 range and you can find many of the more common dates in MS63 for $1,500-2,000. Given the fact that eagles have nearly half an ounce of gold and thus melt for around $700-800, that you can buy reasonably interesting coins for $1,000 seems like great value to me.

Since a Liberty Head double eagle has a basal value of nearly $1,500 worth of gold, your $1,000 bill isn't going to do much damage in this denomination. But if you can swing a $2,000 purchase, you'd be surprised at what you can find. Case in point: I recently sold a lovely PCGS EF45 1858-S double eagle with a CAC sticker for around $2,000. This coin isn't a great rarity but it isn't easy to find, its over 150 years old and it has a great association with the Old West.

I'm a big advocate of having a smaller collection of cool coins as opposed to a large collection of widgets. To me, the rare gold market's "sweet spot" is around $2,500 to $7,500 per coin. In this range you can start to purchase some really interesting pieces, both in terms of grade and rarity.

At this level you won't find much in the way of early gold. But you will be able to buy nice quality Classic Head quarter eagles and half eagles including some of the mintmarked coins.

There are some great values in the Charlotte and Dahlonega market in this price range. For $3,000 to $5,000 you can buy really nice half eagles in About Uncirculated from either mint and this includes some better dates from both the 1840's and the 1850's. You won't be able to buy the keys like the 1842-D Large Date or 1861-D half eagles but there are not many other dates you won't be able to afford in the price range.

Even if have around $7,500 per coin to spend, you'll probably find Proof gold to be well out of your range. But how about nice Uncirculated No Motto half eagles or eagles in the MS61 to MS62 range for around $5,000 per coin? These still exist and the quality of tends to be well superior to comparably graded C+D mint issues.

At the $5,000 price point, you can purchase some really interesting Liberty Head double eagles. Want some examples? Some of the coins that I've personally sold for five grand or so in the last 45 days include a trio of nice EF45 1851-O's, an 1855 in AU58, an 1856 in AU55, an 1864 in AU55, and an 1865 in AU58. All of these were approved by CAC, all had good eye appeal and all are "out of the ordinary" dates in above-average grades.

There is so much more to select from at the $5,000 to $7,500...the list could go on and on. Better date Three Dollar gold pieces or common dates in nice MS63 to MS64. Rare, seldom-seen San Francisco issues of all denominations. Nice common date Carson City double eagles in About Uncirculated.

New collectors are often intimidated by the better date United States gold coin market and they don't need to be. There are a tremendous amount of interesting coins out there at $7,500 or $5,000 or even $2,000.

Do you have questions about how much you have to pay to play in the rare gold market? Feel free to ask me via email at dwn@ont.com or leave your comments below.

Why the Rare Coin Market Isn't the Art Market

As much as coin dealers--myself included--try to compare the coin market to the art market, the more you look at coins, the more you realize how insignificant this market (currently) is when compared to art. Will the coin market ever "catch up" to the art market and is it fair to make any coin vs. art comparisons? I'd like to share my thoughts on this with you. If you look at art from an outsider's perspective, the prices that great objects bring seem baffling. $50 million dollar Warhols? $100 million Giacometti sculptures? And what seems all the more baffling are that prices like this are for items that not everybody agrees is a masterpiece.

But examine the art market with a little bit more perspective and the prices that make coin dealers exclaim that MS64 Indian Head half eagles at $3,500 are a smoking value seem less relevant.

The market for seven, eight and even nine figure art objects is extensive and it is world-wide. If a Vermeer painting was discovered and authenticated, there would be a deep pool of buyers waiting to purchase it; even if the final price realized at auction was in excess of $200 million. Compare this to a famous rare coin like a 1913 Nickel or an 1804 Dollar. Sure, these are famous and desirable coins and an example of either would bring $5 to $10 million in the right market conditions. But the number of buyers who would be competing for these classic rarities is probably less than ten; maybe even as few as five.

The lack of depth in the coin market is even more apparent in thinly traded areas like Territorial gold or Patterns. A coin can be extremely rare and there might only be three examples known. But if there are only two strong buyers for that issue and both already have the coin, the thinness of the market is detrimental. This tends not to be the case in the art market which is deeper and which has institutional buyers as well.

There are hundreds of art museums in the Western world and a small but significant number of these have the money available at most times to buy great art that fits into their collection. Sadly, the Mint Museum in Charlotte has no budget (or desire) to purchase a great Charlotte quarter eagle if it becomes available. The Getty Museum, on the other hand, has been a major buyer of antiquities and photography for years and has helped to push values upwards in those areas.

The art world does a wonderful job of cultivating new buyers. In addition to museums there are active art scenes in cities like New York, London, Berlin and Los Angeles that have beautiful, high-end galleries where collectors (or potential collectors) can go to learn about new art, view exhibits and socialize with other collectors. The number of high-end coin stores in the United States is next to none, and I somehow can't imagine hedge-fund directors in New York or trust-fund kids in London spending Saturday mornings chatting with the proprietor of the local coin shop.

While I personally love rare coins and I do think the market has come a long way in the past decade or two, it still has a long, long way to go as far as self-promotion goes. Art shows are much more upscale than coin shows, and gallery exhibits introduce new works to collectors or reinforce the greatness of existing masters. When's the last time you went to your local museum to see a coin exhibit?

The rare coin market has become increasingly internet-driven and I think that's a great thing; I know that it has certainly helped my business immeasurably. But the personal interaction between dealers and collectors in the art world remains more sophisticated and "better" than in the coin world and I think the art world is healthier for this.

Another thing to remember about the art market is that it is far more international and cosmopolitan the the coin market. When a great French Impressionist painting is offered at auction, it is possible that the winning bidder might be American, British, French, German, Swiss, Russian, or even Chinese. When a great Liberty Head half eagle is made available, the chances remain very strong that it is going to sell to an American buyer.

Buying art serves an important social function that doesn't yet (and may never) apply to coins. When a billionaire Russian oligarch wants to makes a splash in the West, he does three things: buys an English Premier League soccer team, purchases a great apartment in New York, and makes a splash at the season's Christie's and Sotheby's Contemporary and Modern Art sale.

Coins are not on the radar of many big money buyers because they are too small to display and you can't impress your friends by laying out a PCGS box full of Gem rare date Saints.

But I think that the transportability and compactness of coins may ultimately appeal to big money buyers. Its a lot easier to move your coins from New York to London to Dubai than it is your art collection. As the world becomes a more complex, dangerous place the ability to quickly transport significant amounts of personal wealth gains in importance.

Would the rare coin market have a sudden transformation if coins, as a category, were suddenly included in Sotheby's and Christie's roster of sales? Probably not. There are not enough expensive coins around to keep these two firms interested in maintaining departments and both firms don't appear to want to fool with art objects that are worth much less than $25,000-50,000 and up. And even when Sotheby's and Christie's had coin departments, their sales were primarily attended by American dealers.

If anyone is going to take the coin market to an international audience, it's Heritage and I would assume that selling coins to Chinese industrialists is on their radar. And let's not forget that both PCGS and NGC have overseas offices and are focusing considerable time, energy and marketing dollars on appealing to foreign collectors and dealers.

For the United States coin market to become more like the art market, I think a few things need to happen. Some of these are possible, some are already happening, and others seem more like a pipe-dream.

1. There needs to be more and better high-quality general numismatic reference books. We are in a golden age of numismatic research but most of the books published appeal to a narrow range of specialists. We need more books like "The 100 Greatest U.S. Coins." A superb quality coffee table book on United States gold coins, for example, would be a great way to get more high net worth individuals interested in coins.

2. There needs to be a few upscale coin stores in New York. Manhattan remains the financial and social capital of the world and it is filled with superb art galleries. But there is no place a hedge fund manager can go and look at great coins for sale in comfort and privacy. Heritage has launched a New York office and Stack's-Bowers will become more retail friendly (I assume), but there is still a huge void in New York.

3. The Smithsonian collection needs to reopen and there need to be touring exhibits of great American coins at locations more accessible than coin shows. There are hundreds of places in the United States to view great American art. There are only a handful of institutional collections available to view in this country.

4. There needs to be at least one or two upmarket coin shows in New York every year. Captains of Industry aren't going to fly to Rosemont or Long Beach to go to shows. I doubt if an Armory-style show for coins would work but I'd be curious to see what happened if a coin dealer were allowed to exhibit at a fancy east coast art and antiques show.

5. The coin market needs to think with a long-term perspective. Dealers need to be thinking about the market in 2021 and 2031, not just in 2011. Coin doctoring is bad for the long-term health of the rare coin market just like scandals in the art market can hurt that industry in the long run. In a good market, coin dealers are too busy to promote numismatics and in a down market, they are too poor. There are times I wish there was a Benevolent Dictator in the coin business who told us dealers what to do and how to do it.

6. The professional side of the coin business desperately needs an infusion of fresh young faces. The art market has the advantage of hundreds--if not thousands--of smart, enthusiastic Art History majors who enter the market each year from college. The coin market has a lot of the same faces who have been around for two, three, and even four decades.

That said, I still like the future of the rare coin market. I think there is real value in selected areas of American numismatics. The relative affordability of Classic American Rarities is a compelling factor for wealthy collectors used to seeing average quality artwork priced in the millions of dollars. And the fact that the $5 Indian in MS64 that I mentioned above is within the price range of most upper middle-class Americans means that coins have the potential for much more widespread appeal than great (or even good) art.

What are your thoughts about the coin market versus the art market? Leave your comments about this below.

"Stick With The Keys..."

Strategy For Collecting Rare Gold Coins

When I was a kid just beginning to get serious about coins, an older local dealer made a comment that has stayed with me for years. When discussing his buying philosophy he said, "Stick with the keys, kid, you'll never go wrong." What he meant, of course, was that if you bought the rarest, most desirable coins in a specific series, you would do well over time.

His advice was sound, and key date coins in nearly all series have performed brilliantly during the last decade. This was even further reinforced this morning by a key date that I had just purchased at a show.

I listed an 1854-D quarter eagle in PCGS AU58 CAC on my website this past weekend. Within one day I had no less than six people inquire about it (all the more impressive when you consider I was asking $18,000 for it) and this got me to thinking about a hypothetical situation involving buying key date rare gold coins.

Let's say a collector had around $100,000 to spend over the course of a few years on Dahlonega quarter eagles. Would he be better off trying to assemble a complete (or near-complete) set in the EF grades or trying to spend all the money on as many nice 1854-D, 1855-D, and 1856-D quarter eagles as he could find?

I'm not certain that there is a "right" or a "wrong" answer for this. He could spend his $100,000 on processed, over-graded examples of these three dates and have a group of coins that, while rare, will prove hard to sell when the times comes to do so. In this case, I'd rather see the collector purchase thirty nice $3,000-3,500 coins.

But assuming our collector friend was patient, savvy, and well-connected and was able to acquire a few nice key dates would he have a "better" collection? I'm not certain that a small group of key dates actually constitutes a collection per se but as someone who buys a lot of Dahlonega quarter eagles, I'd personally be more interested in a small group of rarities than an assortment of more common examples.

Let's talk about "key" dates.

There are key dates that aren't especially popular (the 1842-C Small Date half eagle comes to mind) and there are key dates that seem fully priced at current levels (some would say the 1870-CC double eagles fits this category although I wouldn't necessarily agree with this). The three Dahlonega quarter eagles that I mentioned above fall into the category of key dates that are popular and priced at levels that make sense.

What makes one specific key date more desirable than another? In the area of rare date gold, I'd list a few specific factors.

The first is the overall collectibility of the series a coin is a key in. If a series is actively collected by date (say St. Gaudens double eagles) than a key date within that series is likely to be highly prized--and priced. If a key date is part of a series that is not terribly popular (say San Francisco quarter eagles) than a key issue might not be in strong demand.

Certain key issues aren't necessarily rare but they are in strong demand due to the nostalgia factor. When you were a kid, you were probably obsessed with the 1909-S VDB Cent, right? There was that gaping hole in your blue coin folder that you knew you'd never fill and that pesky S-VDB haunted your dreams for years...until you became successful and could afford a nice one. In its own little way, for a coin geek buying a nice 1909-S VDB Cent is like becoming the starting quarterback for your high school team or dating that hot girl from your 10th grade English class who'd never make eye contact with you.

For a more sophisticated coin collector, the concept of the key date has other ramifications. Is the coin rare in all grades? What is the "right" grade to buy the specific key date? Is the issue in question historically recognized as a key or is it an issue whose rarity is recently noted?

But I digress...

Getting back to our original hypothetical question, I think I would choose the key threesome Dahlonega quarter eagles if I were presented the question I asked earlier. I'm basing this decision on the fact that whenever I do list any of these three dates on my website they get multiple orders and seem to attract collectors who don't necessarily specialize in the series.

This last point is important. A key issue is iconic if it has multiple levels of support. A coin like a 1795 half eagle or a 1907 High Relief St. Gaudens double eagle isn't truly a "key" issue from the standpoint of true rarity but both are issues that are sought by collectors or investors who aren't specialists in early half eagles or Saints.

I haven't met many gold coin collectors who focus exclusively on key issues and after thinking about this, I'm sort of confused as to why more collectors don't do exactly this. How cool would it be to see a collection of Liberty Head half eagles that contained Condition census examples of the ten rarest issues or a Liberty Head eagle collection that focused on rarities such as the 1858, 1864-S, and 1875?

What are your thoughts on key dates? Please feel free to share them with me in the comment section below.

What's Hot and What's Not: Spring 2011

One of the more popular entries in the DWN Blogospehere is the "Hot/Not" feature. Its been a while since I've written one of these, and with groundbreaking ideas not exactly teeming in my little coin brain right now, it seems as good a time as any to analyze which coins are in demand right now and which aren't. WHAT'S HOT

1. Virtually any coin that is either finest known or which appears as such according to the PCGS/NGC population figures.

There have been some really incredible auction results (and private sales) in the last few months involving United States gold coins that were "population one with none better." Obviously, there has always been a great level of demand for coins like this. But in the past the "make your mouth drop" prices tended to be for very actively collected areas like Carson City gold or New Orleans double eagles.

A recent market trend is for even esoteric coins that are indisputably great to bring big bucks. An obvious example is the $103,500 1862-S eagle that I blogged about recently. This is a coin that as recently as two years ago (or less) would have probably flown under the radar. Today nothing is "too" esoteric; as long as it is a nice coin and it has that all-important "pop top" feature going for it.

Will this continue? I see no reason why not. There is clearly a very strong ultra high-end segment of the market right now; investors and collectors who are seeking the best of the best and will pay virtually whatever it takes. And here's the rationale behind this: a really great finest known United States gold coin from the mid-19th century is still buy-able, from time to time, in the $50,000-100,000 range. Compare this to prices on great American art (or other collectibles) from the same era. Coins at the upper end of the market still make lots of sense when viewed from this perspective.

2. Rare Proof Gold

Another area that I've written about recently is rare Proof gold. By this I am generally referring to pre-1890 issues with mintage of fifty or less; more often than not in the eagle and double eagle denominations.

This is an area that appeals to well-heeled collectors and investors who are typically relatively new to numismatics. These coins are indisputably rare, tend to be visually impressive and are large in size; three perfect factors in determining their increased level of demand.

A coin like an 1870 double eagle in Proof was never "not hot." The fact that coins like this have actually become available in the last six months to a year is a factor in their record-setting prices at auction. A coin can't be "hot" if it is never available and before this recent mini-spate of high-profile Proof gold it had been a considerable amount of time before such coins were available.

3. Interesting Early Gold

If you are a collector of early gold, you've probably noticed a real drought of interesting pieces available in the last year of so.

This scenario is even worse at coin shows. I typically buy four or five interesting early gold coins at a major show. So far this year I've been nearly shut-out in my early gold buying at shows; even at such large events as FUN and Central States. Most of what I do see is either the same group of over-graded retreads that remain in stale inventories or semi-generic issues (1813 half eagles, 1803 eagles, etc) that just don't appeal to me unless they are fresh and lovely.

What's with this lack of product? I think it has to do with a couple of factors. First is the strength of the hands that the good stuff rests in right now. A lot of strong buyers focused on early gold during the 2005-2010 era and they aren't selling right now. Second is the fact that nice quality early gold is tougher to find than most people realize. Now I'm talking about 1821 half eagles and 1798/7 eagles here; I'm talking about relatively common coins like 1805 quarter eagles or 1803/2 half eagles. Crusty, eye-appealing and affordable gold is hard to find in any market and especially so in this quality and rarity-oriented era in which we collect.

If a sale of early gold that contained a few dozen really fresh, really appealing early gold coins were to occur (the early gold equivalent of the Miller sale held by Heritage at this year's FUN convention) I think you'd see crazy, crazy prices.

4. Solid Value Collector Coins

It doesn't matter if were talking rare date San Francisco half eagles in Fine to Very Fine or New Orleans eagles in Extremely Fine or crusty Dahlonega quarter eagles. If the coin is a solid value, if its priced in the $1,500-5,000 range and if it has something "special" about it (great visual appeal, estimated population of under 100 pieces, low mintage, etc.) it is in very high demand right now.

You'll notice that most of my first three "hot" series dealt with expensive to very expensive coins. While it is true that the very high end of the market is good right now, the same can be said with the true collector end of the market.

People are little less scared to spend money now than they were two or three years ago. I'm noticing that collectors who might have sat on the sidelines in 2009 and even 2010 are now returning to the market. But these same collectors are more particular with what they are buying.

I'm noticing that it has become harder and harder to find attractive, interesting coins in this price range. And this is even with me broadening my horizons and dealing in areas that I shunned in the past (Philadelphia and San Francisco issues come to mind here).

I'm going to limit the "hot" areas to four but there are other coins that seem really strong right now. These include but are not limited to Dahlonega quarter eagles and half eagles, Type One double eagles, Carson City double eales, rare date Liberty Head eagles and Civil War era gold.

WHAT'S NOT HOT

1. Off Quality Better Date Saints

I've discussed in detail in previous blogs as to why the St. Gaudens double eagle market has floundered in the past. Its most definitely in a floundering mode right now and the coins that seems to be in the least demand are the semi-keys in off grades. Examples of such coins would be a 1924-D in MS63 or a 1925-S in MS62.

Why are these coins that nobody wants right now? There are a host of reasons. These All these better dates are available in higher grades and with the exceptions of true rarities like the 1921, collectors don't want to settle for grades. Saints in MS62 and MS63 grades typically are not attractive and many of these coins are rubby "sliders" that have low-end eye appeal. And the populations of these faux better dates are high in these grades. A mintmarked Saint from the 1920's might have a population of well over 100 coins in the MS62 to MS63 range with another 50+ higher yet still be priced in the $5,000-15,000 range.

Unless promoted, I don't see the market for these coins getting better anytime soon.

2. Commemorative Gold

In nearly three decades of being a professional rare coin dealer, I can't recall having met anyone who actually collected gold commemoratives. I've looked at collections/holdings/portfolios that contained collections of gold commems but these were invariably sold as investments.

Every five years or so, someone promotes commemorative gold, makes a lot of money and escapes before the market deflates. I think its been at least five years since this area of the market has been promoted and I'd have to think these coins are overdue. That said, I personally hate them.

Why? Too small, too common, banal designs, no challenge for the collector; everything that as a numismatist I find boring in one small package. There are two notable exceptions: the Pan-Pac $50 Round and Octagonal issues. These seem as popular as ever and despite some drop in the price a few years ago I think these are a safe and solid "big ticket" item for the well-heeled investor.

3. Indian Head Quarter Eagles

As I've mentioned before, this series was "hot" for many years; mainly due to outstanding promotion(s) by a small group of marketers. For the most part, these firms have stopped selling Indian Head quarter eagles and there appears to be a glut of coins on the market.

Prices are down quite a bit in this series and I'm not sure if now might not be a good time for contrarians to take a position (at least a small one). If you could find real Gem common dates at current levels they seem like a fair value. The same might even hold true for the better dates (especially the 1914 and 1914-D) if you can find Gems with CAC stickers and great eye appeal.

The key 1911-D has taken quite a beating price-wise and bid has dropped down to $54,000. I'm guessing that a CAC-approved Gem would bring a lot more than this if one were available. I've mentioned before that I find this to be one of the most overpriced American coins of any date/size/shape but....

4. Off Quality Material

Looking through many cases and boxes at coin shows, I'm amazed at the large number of really awful coins that are still around. I almost never price this sludge but sometimes, just for grins, I'll pull out an especially nasty coin and ask for a price; just for educational purposes, of course. Sometimes, the answer sounds almost desperate: "I dunno; what will you pay?"

Since the advent of CAC and with the scrutiny given coin doctoring by the grading services, perceived quality has become fashionable among collectors. (Note that I say "perceived" since I think many collectors who think they are buying quality coins do not really know what a quality coin is). This has increased the demand for "A" quality coins and "B" quality to an extent while making "C" quality very illiquid; especially in the $5,000 and up category.

I see no change in this. Collectors will continue to seek nice (or at least nicer coins) and this will increase the spread between these and blatantly unoriginal, low end pieces.

Other areas in the market that seem "not hot" to me but which didn't make the List of Shame include PR70/MS70 moderns, generics, MS64 and MS65 Indian Head half eagles, many Indian Head eagles and faux-scarce date Type Three Liberty Head double eagles.

The Eliasberg 1858-O $20.00

I'd like to share a photo and some information about a really interesting coin that I recently bought and sold. It's a lovely 1858-O double eagle, graded AU55 by PCGS. What makes this coin really special, in my opinion, is its fantastic pedigree. To the best of my knowledge it has the oldest continual pedigree of any 1858-O double eagle, and certainly the best. The 1858-O is the 8th rarest of 13 double eagles produced at the New Orleans mint. You'd think this meant it was a common coin, but this is far from the case. There are an estimated 200 or so known with most in the EF40 to AU50 range. This date becomes quite rare in the medium to higher AU grades and it is extremely rare in Uncirculated with just six or seven known to me.

The finest known 1858-O double eagle is a PCGS MS62 owned by a prominent Midwestern collector. It came from the Bass III sale (May 2000) where it sold for $50,600. Harry Bass obtained it from the Merkin 10/66 sale.

There were four Uncirculated 1858-O double eagles found in the S.S. Republic treasure and this swelled the number of Uncirculated examples. The best of these four was an MS63 (graded by NGC).

I love the freshness of this coin and I think a quick study of it will prove helpful to rare gold coin collectors. It has wonderful soft, frosty luster, and pleasing natural yellow-gold coloration on the obverse and the reverse. This coloration is exactly "right" for the issue and the few 1858-O double eagles that I have seen that haven't been dipped or processed displayed a similar hue.

This date is not generally seen with a sharp strike and this example is about as well detailed as any I can recall. Note the full radial lines in the obverse stars and the nearly complete detail on Liberty's hair. In both instances, this is very unusual.

The surfaces of this coin are clean for the grade. There are a few scattered scuffs in the fields, which is to be expected from an AU55. That said, I think this coin is as clean as other Type One double eagles that I have seen in AU58 holders.

This coin last appeared as Lot 1948 in Stack's November 2009 auction where it sold for $27,600. Before this it was in the October 1982 Eliasberg sale where it brought $2,640. It was obtained by Eliasberg in the famous Max Mehl June 1946 sale of the Atwater collector where it realized $105.

The Eliasberg 1858-O double eagle is now owned by a Southern collector who specializes in New Orleans gold coinage. He already owns a number of impressive New Orleans double eagles, but I'm willing to bet that this coin will become one of his favorites.

Are you interested in adding coins like the Eliasberg 1858-O double eagle to your collection? If so, please feel free to speak to me at 214-675-9897 and let me know how I can be of assistance to you and your collection.

The $103,500 1862-S Eagle

Lost in the hubbub surrounding the recently-concluded Central States coin show and the Heritage auction held with it was a sale that I think ranks as one of the more remarkable in the rare gold coin market all year. The coin of which I speak is an 1862-S eagle graded MS61 by NGC. Unless you are pretty knowledgeable, this coin probably doesn't seem like anything too impressive. But to those of us who know and love the Liberty Head eagle series, this is a coin that is impressive; downright impressive, in fact.

According to information from the cataloger, this coin showed up at the March 2011 ANA show in Sacramento where it was graded and encapsulated by NGC. The cataloger went on to add "the coin was apparently preserved by a single family for many years and we can find no previous auction appearances for it." Now that's a fresh coin!

The 1862-S, as a date, is sort of overlook-able. It is not even close to the 1864-S in terms of overall rarity and it is overshadowed by the 1865-S Normal Date as well. A total of 12,500 were struck of which an estimated 75 or so are known. This date is actually not all that hard to find in the lower grades (in this case, VF and EF) but it is very rare in properly graded AU and extremely rare in the higher range of this grade. It was previously unknown in Uncirculated and I have never seen one better than AU55.

As of the middle of 2011, PCGS hadn't graded any examples of this date higher than AU55. NGC had graded two in AU58. The previous auction record for an 1862-S eagle was $25,300 set all the way back in May 1994 by a PCGS EF40 in the Bowers and Merena sale that would grade at least AU50 by today's standards. The best coin that I can remember having seen prior to this newly-discovered piece was Bass III: 653, a PCGS AU55, that sold for a very reasonable $8,050.

When I examined the coin in person, I was impressed. I'm not certain that the coin would "cross" to a PCGS MS61 holder but I thought the coin was really Uncirculated with nice surfaces and a great overall look for the date. I was particularly impressed with the coin's luster. Considering what the typical 1862-S looks like (very worn and usually very abraded), this was clearly a special coin.

But here's the rub. While "special," this coin is as esoteric as all get-out. Its the sort of coin that, if it had been offered to me by the owner, I would have had the following conversation with myself:

Doug Winter's Adventurous Side: "This is a great coin! Its unique in Uncirculated! You love coins like this! You have to buy it!"

Doug Winter's Practical Side: "But who cares? Its a very expensive S Mint Ten and coins like this are unsaleable. The two biggest collectors for this series already have decent coins and they might not want to upgrade. If they pass, there might be no one else who cares. Cool, cool coin but I pass."

Usually, the DWPS is smarter than the DWAS and Mr. Practical wins. But in this case, Mr. Adventurous was right.

I don't know who bought this coin or who the under-bidder was. I was guessing before the sale started that the coin would bring in the area of $50,000-60,000. CDN Quarterly Bid was $31,000 in MS60 (which is a totally arbitrary number since none existed before this coin was slabbed in March but it was the basis that most buyers were going to operate from). I did make the statement to a fellow dealer a few hours before the sale began that this was a coin that I could put in my case at a major coin show, price at $60,000 and not get so much as a bite.

The price realized of $103,500 is remarkable for a variety of reasons. The first is that this price is further proof that the Liberty Head eagle series, after years and years of neglect, has really come into its own. The second is that it shows that great coins, no matter how "esoteric" they appear, are capable of bringing startling prices in today's quality and rarity driven market. The third is the fact that a coin like this even exists and how it came onto the market with no prior history. It proves that there are great coins out there, still awaiting discovery.

Why is Proof Gold Suddenly a Hot Commodity?

Without a lot of fanfare, Proof gold coins have become a strong area of the market. In this blog, I'd like to postulate as to why Proof gold coins have become so avidly desired, which Proof coins are currently in greatest demand and what the short-term outlook is for Proof gold. To understand the current Proof gold market, it is important to understand the market over the past decade. The years from 1995 to 2000 represented the greatest period of availability for rare Proof gold in modern numismatic history. The sale of the Childs, Bass, Pittman and other collections made very rare issues seem almost common. I can remember there being multiple examples of issues from the 1860's and 1870's available simultaneously. This availability was coupled with a lack of demand for expensive coins once the Bass sale(s) were finished in 2001.

I think dealers who were around for this period (including myself) got a little spooked by expensive Proof gold coins. We remembered owning great, great pieces in 2000-2003 and not being able to sell them. Even when the coin market started getting very strong around 2004 and expensive coins were suddenly in vogue, I can remember that Proof gold seemed to lag the market. Everyone suddenly wanted great business strikes but formerly in-demand Proof gold just seemed harder to sell.

(Side note: Proof gold had been actively marketed in the 1980's and early 1990's. During the go-go investment years of the late 1980's I can remember Coin World ads touting Proof gold as "real coins for real men." But the coin market goes through cycles of demand and it seemed that many of the biggest dealer advocates of Proof gold in 1988 were no longer buyers of such coins in 1998).

This seems to have changed.

What are the major reasons for the sudden surge in demand (and increased prices) in Proof gold? The first answer has to do with supply. In the last year or so, there have been some really interesting Proof gold coins available. The Miller collection, which was featured in the Heritage 2011 FUN Platinum night sale in January, contained many coins that I think will be looked at in the future as truly significant. The quality of these coins was amazing and it was one of the few "time capsule" groups of Proof gold that still exist(ed). By this, I mean the coins hadn't for the most part been conserved. Proof gold with original surfaces is exceedingly hard to find in 2011, and the Miller sale had coins that were not only rare, they were magnificent.

The second reason has to do, obviously, with demand. There was a low level of demand for Proof gold as recently as a few years ago. Oh sure; there were a few people collecting Proof gold by date and when something really rare and really cool appeared at auction it would sell for a strong price. But since late 2007/early 2008 there has been a new breed of collector-investor that has suddenly made a beeline towards Proof gold.

These individuals are wealthy, sophisticated, and generally operate well under-the-radar. They tend to like U.S. gold coins that are very rare, very beautiful and historically significant. For a number of reasons, Proof gold is especially well-suited to them.

But not all Proof gold.

In the coin run-up of 2004-2007, super-grade Proof gold coins were in demand. Investors liked coins like PR68 Liberty Head quarter eagles and PR67 Type Three gold dollars. Now don't get me wrong; these are great coins and they are certainly rare in the grand scheme of things. But their value is derived more from grade than absolute rarity.

Case in point: a perfectly wonderful common date PR65 Deep Cameo quarter eagle from the early 1900's is worth around $17,500. The same coin in PR69 Deep Cameo is worth around $90,000. The quarter eagles from the turn of the 20th century are comparatively available (by the standards of Proof gold) and these sophisticated collectors, many of who have made a lot of money in the stock market by value investing, just don't see the need to own a $90,000 common date Proof 69 Liberty Head quarter eagle.

What does appeal them are Proofs that are very old (in this case, pre-1880) or very rare. And if the coin is large-size (ten dollar or twenty dollar) so much the better.

There are a few other parameters that seem to be important with this new breed of collectors. Off-quality coins won't fly so the baseline for grade seems to be at least PR64. Coins with great eye appeal are in demand and this means that Ultra Cameo or Deep Cameo pieces are commanding more significant premiums than in the past.

With the exception of the Miller coins, originality doesn't appear to be as much of a factor as I would have thought. My unscientific reasoning for this is that there are so few original Proof gold coins left that a premium is hard to place on them. And, most of these collectors really don't like the deep, cloudy natural toning that might be found on an unmessed-with proof double eagle. Big and bright is better and this is the market reality, for better or worse.

The quality of the coins in the Miller sale were an anomaly and you can't necessarily use them as a barometer of the market. There were a number of very rare Proof gold coins in the recent Heritage that sold for very strong prices and were apt metaphors for the entire thesis of this blog. Let's peek at a few.

Lot 5435 was a PCGS PR64 DCAM example of the 1860 eagle. Despite a seemingly high mintage of 50, this is a very rare coin with an estimated ten or so known. The example in the Heritage sale was decent for the grade with a nice naked-eye appearance. It sold for $161,000. The exact same coin sold for $69,000 back in June 2004; its last appearance at auction. More tellingly, a similarly graded but different coin brought $83,375 in January 2009.

An even more interesting coin was Lot 5492; an 1860 double eagle graded PR64 Cameo by NGC. This exact coin had last sold for $94,875 (as a PCGS PR63) back in September 2004. It brought $230,000; exactly the same amount as a similarly graded example (but much nicer, in my opinion) just sold for in the Miller auction.

I was certain that the next lot (5493) was going to be a big-ticket item as it had all the Big Bright and Rare factors going for it. The 1870 double eagle, one of around ten or so known from an original mintage of 35. Another factor was that the coin was actually nice; it was stickered by CAC and I thought it was solid for the grade. In the Miller sale, graded PR64 DCAM, this exact coin brought $189,000. Despite being freshly upgraded (kudos to Heritage for pedigreeing it...) this coin brought a solid $345,000.

Just to let you know that not everything that was big, bright and rare sold for a ton in the Heritage sale, Lot 5496 was an interesting study. Graded PR64 Cameo by NGC, the 1878 double eagle sold for $69,000. This is a very rare coin with no more than ten known from the original mintage of only twenty. Why did it sell for "just" $69,000? Probably because it really wasn't very nice. Also, this is an overlooked date that doesn't have great auction records despite its great rarity. Heritage 1/09: 4135, graded PR64 DCAM by PCGS and nicer than the coin referenced above brought $74,750 in a weaker market.

My guess is that we'll see some more big-ticket Proof gold coins on the market this summer during the ANA sales. Anyone who bought very rare Proof double eagles around 2004 to 2006 has seen them double or even triple in price and this will motivate some collectors to sell. I'm not certain that the market can sustain this price movement but a coin like an 1870 double eagle in Gem Proof at $500,000 or even $600,000 might not seem as impossible as it sounds as you are reading this right now.

Is it a Widget?

One of the newer catch-all coin terms that's been making the rounds is "widget." This is a derogatory term meaning a coin that is common, boring, and lacking in character. I would primarily characterize a widget as something that is generic in nature. No one goes out and says "I'm putting together a collection of widgets," but then again, the definition of this term seems a bit vague to me. I thought it might be helpful to take a random array of United States gold coins, describe them and posit as to if they qualify as widgets or non-widgets.

1. 1905 Quarter Eagle Graded MS65 by NGC. Even though this is in theory a relatively scarce coin, I think it qualifies as a widget. It has no real character to speak of and it is a coin that lacks any real collectors as end-users. I think that in order for a coin to be considered as a non-widget it has to have a solid collector base as opposed to being an investor-dominated type or series.

The exact same coin with some cool mint-made copper spots or extremely deep Prooflike fields becomes more interesting. A 1905 quarter eagle in MS65 with exceptional multi-hued color or one that is designated by NGC as being DMPL is actually not a widget.

2. The same coin but in MS63, raw and enclosed in an old presentation box with a note that reads "To Son, with love from your father Xmas 1905." The presentation box makes this a unique item and gives it character. So, I'd have to say that this coin, even though it is worth less than the coin mentioned above, is not a widget.

3. 1859-D Quarter Eagle, Graded VG-8 by PCGS. Yes, its a low grade coin. But it is scarce in any grade and the fact that it is a Dahlonega quarter eagle that somehow circulated for years makes it (at least to me) fascinating. It is clearly not a widget.

4. 1859-D Quarter Eagle, Graded MS61 by PCGS. Sounds like a cool coin, right? But what if said coin is covered with deep artificial color and it looks like the Deep Southern first-cousin to a Cheeto? Is it a widget? This is a tough question to answer. I would personally say that it is not a widget but at the same time it is not a coin that a connoisseur would want to own. It may actually look nice after being conserved. But I would have a hard-time calling this coin a widget.

5. 1927 St. Gaudens Double Eagle, Graded MS66 by NGC. High grade, pretty coin, etc. etc but still the ultimate widget.

6. Same coin, same grade but now with a CAC sticker. Here's another tough call. The CAC sticker shows it is a nice coin for the grade and I doubt if 10% of all the 1927 Saints that have been sent to CAC have been approved. But its still a widget, albeit an accurately grade one.

7. Same coin, same grade, same CAC sticker but now in an old green label holder. I'd vote that the coin while "witget-y" is no longer a widget. The old PCGS holder gives it some character and, all of a sudden, a level of demand that wouldn't exist if the coin were in a fresh, new holder.

8. An 1861-D gold dollar with a hole at 12:00. I'm not a fan of damaged coins and a gold dollar with a hole in it ranks pretty low on my list of coins to buy for inventory. But the rarity of the 1861-D makes it deisrable in virtually any grade. If the hole were small and not not overly crude and I could still see the date and mintmark, I'd buy this coin (as long as it were reasonably priced). It is most definitely not a widget.

9. A recently conserved PR66 Indian Head half eagle. Even though this is an expensive ($40,000+) coin, it is a coin whose value is predicated more on its appearance than on its grade. I would rather own a PR63 Indian Head half eagle with nice original color but a few shiny spots than a PR66 with no semblance of originality.

One of the points I'm trying to get across here is that a coin can be worth $50 and be a cool, numismatically desirable item while another coin can be worth $100,000 and be an expensive widget.

What are some coins that are expensive that you feel are widgets? And what are some inexpensive coins that you find to be very interesting and far from widgethood? Leave some comments below and let's talk widgets!