Article Written by Dan Duncan – Pinnacle Rarities
CoinWeek Content Partner

World War I was called “The War to End All Wars.” The sad irony is that it was arguably the war to begin all wars – at least for the modern era. A couple generations (or more) removed, it’s hard for us to get inside the average man’s head from 1921. But the horrors of that war included the use of nerve gas and mass genocide for the achievement of military goals. The resulting carnage statistics are estimated at over fifteen million civilian and military deaths. With that in mind, it’s easier to understand the sentiment for peace was overwhelming, and from this passion the Peace dollar was born.

Peace

This story begins with Allied forces pushing back against German occupation. By 1918, the German forces were defeated, and the negotiations of the Allied powers on how best to “punish” Germany began in Paris. These talks originally included seventy delegates from 27 different nations. This soon proved too complex to find any common ground and the actual treaty was drafted by just the three largest nations – The United States, France and Great Britain. Even with just three nations represented, decisions and agreements to key components were tough. Each nation’s goals conflicted with the others.

Ultimately an “unhappy compromise” was reached. It was called the Treaty of Versailles, and it officially ended the war in Europe. But stateside, the battle for a declaration of peace had just begun. Congress initially bucked Woodrow Wilson’s plan and even after the Harding administration took over, Congress on several occasions rejected the League of Nations and the ratification of the Treaty of Versailles. It wasn’t until the summer of 1921 that we passed the Knox-Porter Act, and peace was officially declared between the United States and Germany.

Dollars

The cost of the war was paid in silver from melted silver dollars. As our currency at the time was backed by silver dollars in the treasury vaults, the result of this debt was a recall on circulating silver certificates. Dollar production had been on hiatus since 1904, but the Pittman Act of 1918 ordered over 270,000,000 silver dollars to be coined to relieve this debt and replenish the Treasury’s coffers. The U.S. was going through a recessionary cycle and the Pittman Act went a long way to helping the economy recover. While authorization of the coinage of silver dollars passed in 1918, it wasn’t until three years later that the Peace dollar design was implemented.

Peace Dollars

The idea behind the new dollar design was a commemorative example to serve as a reminder of the atrocities from the war and the value of peace. The path to the enactment of the design was as turbulent as the road to peace itself. The Pittman act had paved the way for new dollars. But, the design ordered was the standard dollar or today’s Morgan type. At the time, monetized commemoratives coins had begun to make waves in numismatic circles and a number of different examples and denominations had been produced since 1892. Up to 1921, all commemoratives had been sold at premiums over face value and only a few ever inadvertently went into circulation. In 1918, as the war was ending, The Numismatist ran an article suggesting a commemorative that would circulate at face value.

This idea was batted around and in 1920 Farran Zerbe submitted a workable framework to the commemorative idea. Over the following fifteen or so months, the American Numismatic Association enlisted the help of Congressmen William Ashbrook and Albert H. Vestal. Their work along with the blessing of Mint Director Raymond Baker and the Commission on Fine Arts secured a “victory” coin’s place in circulating coinage as the silver dollar. The nation had yet to officially declare peace, but the proponents of the new dollar forged on. Short on time, they held a closed competition amongst the better known medalists and Anthony de Francisci won. His works included the recently released Maine Centennial Coin of 1918. His rushed Peace design met with equal amounts of scorn as delight. And after it underwent some cosmetic alterations, it was pushed through the necessary committees and approved.

1921 Morgans were in production for most of the year and were being struck at amazing speed. Upon approval, Baker ceased Morgan production but the Peace designs weren’t struck until the last week in the year. With little preparation time, the dies had not undergone much testing. The bold devices caused the dies to break prematurely and the design elements suffered from lack of sufficient pressure. Initial strikings of the high relief 1921 were not met favorably. The devices weren’t clearly struck up, the lettering wasn’t sharp and the coins were rumored to stack improperly. With die life and production speed compromised by the stylish design, the elements were flattened creating the lowered relief examples used for the duration of the series.

Mintages continued from 1922 to 1927 in large quantities tying up the mint production and causing low mintages of the other denominations of the period. In 1928 mintage numbers decreased, and once the Mint had satisfied the requirements of the Pittman Act, coinage of the Peace dollar was halted. It wasn’t until after the recall of gold coinage that new silver dollars were authorized. The Peace design was reborn with coins struck during 1934 and 1935 to fulfill the requirements of the Silver Purchase Act of 1934.

The design makes a brief encore appearance with the authorization of several million examples in 1964. And, in 1965, Denver coined some 317,000 1964 dated examples. Shortly thereafter, the Coinage Act of 1965 prohibited the production of silver dollars. The idea of a Peace dollar was scuttled with all coins destined for the melting pots. Examples of the 1964-D Peace dollar are rumored to exist, but with recent 1933 $20 legislation, the likelihood of anything ever surfacing is virtually nil.

Today, the Peace dollar is one of numismatics most popular series. The design is rich in history, one that begins as a commemorative coin and ends up an instrument of economic recovery. The story highlights the U.S. involvement in WWI, and its efforts to fund the conflict. The dollar was later used to stabilize the economy during the Great Depression. And now, the series is popular amongst collectors because of its relative affordability, the lack of any true stoppers and mostly for its lasting beauty. The historic past is one that spans three generations and the collectible nature means the Peace dollar will be enjoyed for many more to come.

By Patrick A. Heller – Liberty Coin Service
Commentary on Precious Metals Prepared for CoinWeek.com

Even though gold and silver prices are up significantly since the beginning of 2012, that doesn’t necessarily mean that this trend will continue. Buyers and sellers modify their decisions as prices change.

When you look at who is and who isn’t actively buying or selling gold and silver right now, that can give you significant clues as to where prices head in the near term.

Ever since the price of gold surpassed $1,000 for the first time in 2008, there has been significant liquidation and recycling of “scrap” gold such as jewelry and industrial products. In many instances, people who lost jobs or experienced other financial setbacks have sold assets to generate cash flow. Investment demand in the past three years has been so strong that prices continued to rise despite the increase in recycling supplies. From now into the future, however, the amount of scrap gold that could be liquidated will be smaller than it would have been because of all the gold already recycled.

The story is similar for silver. During the 1979-1980 precious metals boom, many companies acquired equipment to recycle metals. Even though prices later fell so low that it was no longer economical to acquire such equipment, it was still profitable to continue to use existing machines since the acquisition costs had already been paid. As a result, silver recycling continued at a steady pace even when prices were far lower during the past few decades.

Therefore, there is less silver available for recycling today and in the future than there would have been. Another factor to consider is that the use of silver in photography (including x-rays) has fallen sharply in the past decade or so. This is significant because a high percentage of silver used in photography is recycled. As the amount of silver used in photography has fallen, so has the amount of silver that could be recycled.

With higher prices, there would be a strong incentive for mining companies to expand production. However, it’s not quite that simple. From discovery of a mine site until full production used to take an average of about three years. With increasing environmental and other regulations, it now takes an average of about ten years to go into full scale operation.

Increasing regulations have also impacted the ability of existing mines to operate. In January, the government shut down operations at the Lucky Friday mine in Idaho, producer of about 0.5% of the world’s newly mined silver supply. Even though the mine had passed twice-a-year federal safety inspections, it was closed because of alleged problems with its state of the art mine shaft supports. The owner of the mine stated that it will take a full year to fix the alleged safety issues before the mine can resume operation.

Overall, silver mine output has been rising over the years even as global gold mine output mostly declined. Still, silver supply is just not increasing enough to match the rise in demand.

For decades, the central banks were net sellers of gold every year. That changed a couple of years ago to central banks now being net buyers of gold. The swing from being a net supplier to a net buyer has affected the supply/demand equation by about 40 million ounces a year. This is a huge impact when you consider that worldwide annual mine output may be only 70 million ounces.

Above ground inventories of physical gold and silver have dwindled over the past few decades, with supplies of both metals becoming tighter every year. Last year I received several reports of would-be buyers of multi-million dollar amounts of physical gold or silver who wanted to take immediate delivery but were unable to find sellers willing to accept their orders.

While the supply side of gold and silver is constrained, I think the largest impact on the prices of both will come from a surge in buying demand. Even though there has been an increase in demand for the two metals for industrial and investment purposes, the market has not yet experienced a sustained rush to buy physical gold and silver.

For instance, when gold and silver prices fell sharply in late 2008, there were significant delays in purchasing almost every form of bullion-priced physical gold and silver. At the most extreme, new orders for 1 ounce size silver rounds and ingots were taking three months for delivery after the buyers had paid for them. Today, in the US almost every bullion coin and bar is available for live or short term delivery. Premiums are close to as low as they have been over the past couple of years.

The recent weekly Commitment of Traders Report issued by the COMEX show that speculators have not jumped into the market. This means that the price increases have occurred without this source of demand.

China and India are the world’s two largest nations for consumption of gold and silver. What happens in those countries has a major impact on prices.

The Chinese government has been very aggressive at purchasing physical gold and silver for itself and also encouraging its citizens to accumulate precious metals. It is expanding the venues which would make it convenient for people to acquire gold and silver. There are regular stories of Chinese citizens who are unable to purchase physical precious metals because the stores are out of stock or have lines so long that it takes (literally) several hours to get service.

Demand in India is very sensitive to price. When prices fall, demand soars. When prices rise, demand tapers off until there is a sense that the market has established a base from which prices will resume climbing. Right now, buyers in India are mostly sitting on the sidelines since the price of gold broke above $1,700. So, prices rose in the second half of January without extra demand from this nation.

In Europe and the Middle East, there is strong demand for physical gold and, to a lesser extent, silver as safe havens from deteriorating currency values. Demand was especially strong in North America in March and April 2011, but is now lackluster.

Although there have been some investment funds taking positions in gold or silver, this activity has been on a minor scale.

Perhaps the most significant indicator that the rush to buy gold and silver has not started in earnest is the relatively minor importance that the two metals have in world finances. There were times in the first half of the 20^th century where the value of gold and silver mining shares and all the circulating gold and silver coins made up more than 20% of global wealth. Today that proportion of worldwide wealth is about 0.5%.

By the way, perhaps a significant indicator of where prices are headed in the near future is a decision by Endeavor Silver to inventory part of its newly mined silver output rather than sell it at current prices. I have heard that other mining companies are discussing this option, where they might only sell enough metal to fund continuing operations. It is highly unusual for mines to choose to defer cash flow in anticipation of much higher prices in the coming months.

The real rush to buy gold and silver will not be underway until there is strong demand from China and India, elsewhere in the Far East, the Middle East, Europe, and across North America. You will also see central banks and investment funds purchasing greater quantities of physical gold and perhaps silver. When fabricators and wholesalers are unable to meet demand for physical metal, prices could skyrocket. We are a long way from this position today. But it is coming and will be here surprisingly soon.

Patrick A. Heller owns Liberty Coin Service and Premier Coins & Collectibles in Lansing, Michigan and writes Liberty’s Outlook, a monthly newsletter on rare coins and precious metals subjects. Past newsletter issues can be viewed at http://www.libertycoinservice.com. Other commentaries are available at Numismaster (http://www.numismaster.com under “News & Articles). His award-winning radio show “Things You ‘Know’ That Just Aren’t So, And Important News You Need To Know” can be heard at 8:45 AM Wednesday and Friday mornings on 1320-AM WILS in Lansing (which streams live and becomes part of the audio and text archives posted at http://www.1320wils.com.

News and Analysis on scarce coins, markets, and the collecting community #93

A Weekly CoinWeek Column by Greg Reynolds

It has been a while since I have written about Liberty Seated Half Dollars. Indeed, I have not done so since August 2011, when I discussed several Liberty Seated halves that had then just been auctioned, as members of the Dick Osburn Collection. The topic here is Liberty Seated Half Dollars that were offered in the FUN Convention auction, during the Platinum Night session on Jan. 4, 2012. I have already covered many other coins that were auctioned in this same event, including bust halves last week and earlier the Eliasberg-Atwater-Jung Chain Cent that realized $1.38 million. (Clickable links are in blue.)

Liberty Seated Half Dollars are scarce and attractive coins, which are undervalued from a logical perspective. While the uncirculated and Proof coins that I discuss here are too expensive for most collectors to obtain, Liberty Seated Half Dollars are not very costly in circulated grades, and may be good values in comparison to bust halves or Walking Liberty Half Dollars. Also, 63 grade halves tend to be much less expensive than the even higher grade coins that I discuss herein.

Besides, I wish to repeat my belief that, for collectors to understand the classic coins that they own or see, there is a need to learn about coins that are not affordable. Art enthusiasts often determine that it is beneficial to learn about paintings that they cannot afford.

It is not practical to cover all of the Liberty Seated Half Dollars in this auction session. I am focusing upon ‘No Motto’ Liberty Seated Half Dollars. The motto, ‘In God We Trust,’ was added to half dollars in 1866. Liberty Seated Half Dollars were minted from 1839 to 1891.

The so called ‘No Motto’ type was minted from 1839 to 1866, and this auction featured an impressive assortment of these. Moreover, this auction contained two gem quality, 1853 ‘Arrows & Rays’ Half Dollars, a business strike and a certified Proof. These are representatives of an important one-year type.

I. 1842 ‘Small Date – Large Letters’

The run of Liberty Seated Half Dollars in this Platinum Night session began with an 1842 half that is PCGS graded MS-64. It is of the “Small Date, Large Letters” variety.

There was another 1842 ‘Small Date – Large Letters’ half sold by Heritage in a different session of this same auction extravaganza. Surprisingly, it was also PCGS graded MS-64 and it realized the exact same price, $8050! I did not see the second one.

As high grade representatives of this issue trade so infrequently, it is hard to interpret this dual $8050 result. It could be that the PCGS price guide value of $17,500 is incorrect and should be lowered.

There was also a ‘Proof’ 1842 ‘Small Date – Large Letters’ half in this auction session. All known Proof 1842 half dollars are of the ‘Small Date – Large Letters’ variety.

This one is PCGS certified ‘Proof-64.’ The Heritage cataloguer suggests that seven are known. I am not thrilled about this particular coin. The $43,125 result is strong, a full retail price.

The Proof 1845 half in this sale is PCGS certified ‘Proof-64 Cameo.’ It sold for $57,500, another strong price.

II. Background: Small Dates and Larger Dates

The ‘Small Date’ term refers to the size of the numerals on the obverse (front of the coin). The ‘Large Letters’ term refers to the size of the letters on the reverse (back of the coin). Liberty Seated Half Dollars minted from 1839 to 1841 feature letters that are smaller than the letters on halves that were minted after 1842.

There are 1842 dated halves with both reverses. The ‘Small Letters’ reverse is sometimes called the ‘Reverse of 1839,’ and the ‘Large Letters’ reverse likewise is sometimes called the ‘Reverse of 1842.’

There are three major varieties of 1842 halves: Small Date – Small Letters, Small Date – Large Letters, and Medium Date – Large Letters. The ‘Small Date – Small Letters’ coins are much rarer than the other two varieties, though the ‘Small Date – Large Letters’ is worth a considerable premium over the ‘Medium Date’ 1842 halves.

In the history of coin collecting, obverse varieties tend to be much more significant than reverse varieties, especially those varieties that relate to numerals. A readily apparent obverse variety that is characterized by differences in one or more numerals, such as notably smaller numerals, is more likely, than other varieties, to have the status of a distinct ‘date.’

Randy Wiley and Bill Bugert have analyzed varieties of Liberty Seated Half Dollars and incorporated their findings into a book, which was published in 1993. This Wiley-Bugert (WB) book is available online at the DLRC website. They measured the height of the numerals on Liberty Seated Half Dollars.

In relation to coins, the term ‘date’ has more than one meaning. In the context of Small Date, Medium Date and Large Date designations, the date refers to the physical numerals of the respective year that appears on each coin.

According to Wiley and Bugert, Liberty Seated Halves of 1839 to 1841, plus some 1842s, have a ‘Small Date,’ which measures from 0.056 to 0.064 inch in height. As I already noted, other 1842s have a ‘Medium Date.’ The numerals in ‘Medium Dates’ vary from 0.076 to 0.086 inch. All half dollars of the following years are said by Wiley and Bugert to each have a ‘Medium Date’: 1843-45, 1859-74, 1876-85, and 1888-91.

In contrast, a ‘Large Date,’ which is sometimes termed a ‘Tall Date,’ measures from 0.086 to 0.096 inch in height. Wiley and Bugert report that Liberty Seated Half Dollars dating from 1847 to 1857, and also those of 1875, each have a ‘Large Date.’ It is curious that the 1875 is the lone year from a different era to have a ‘Large Date.’ Halves of 1858, 1886 and 1887 are said to each have an ‘Extremely Large Date,’ which is approximately 0.1 inch in height, give or take 0.02 inch.

The 1842 ‘Medium Date’ coins are often wrongly cited as having a ‘Large Date.’ Among Liberty Seated Half Dollars, 1846 seems to be the only year for which both ‘Medium Date’ and ‘Large Date’ coins are known. ‘Large Date’ and ‘Tall Date’ 1846 halves are the same coins.

III. 1846 Halves

The 1846 ‘Large Date’ (also known as “Tall Date”) is rarer in ‘mint state’ grades than the 1846 ‘Medium Date’ issue. Indeed, the 1846 ‘Large Date’ is probably rare in all grades.

The 1846 ‘Large Date’ in this auction is NGC graded MS-66. I just glanced at it quickly. I tentatively agreed with the 66 grade.

Matt Kleinsteuber carefully inspected it. He is very enthusiastic about this ‘Large Date’ 1846. It has “beautiful russets and blues,” Matt exclaims, “a true Superb Gem, wonderful.” Kleinsteuber is the lead trader and grader for NFC coins.

This 1846 ‘Large Date’ realized $25,300. If it was an 1846 ‘Medium Date,’ it would not have sold for as much. In this case, the premium for the ‘Large Date’ is perhaps $8000.

There were two Proof 1846 ‘Medium Date’ halves in this auction. The values of these Proof 1846 halves should not be directly compared to the values of 1846 business strikes, as Proofs are much rarer and are more expensive.

Each certified Proof 1846 in this sale is PCGS graded ‘64’ and is CAC approved. The first, at $35,937.50, brought slightly more than the second, which went for $34,500. Both prices are fair, though I feel more comfortable about the first coin than about the second. While the second Proof 1846 is more sharply detailed, the toning, surface quality and overall ‘look’ of the first are better.

Importantly, this session contained six Liberty Seated Half Dollars from the 1840s that are certified as Proofs by the PCGS or the NGC. All Proof issues from the 1840s are very rare.

IV. Eliasberg 1847

The Proof 1847 half from the Eliasberg Collection was in this sale. It is NGC certified Proof-64.

Louis Eliasberg formed the all-time greatest collection of U.S. coins and he had an excellent collection of world coins. This half dollar was auctioned by B&M of New Hampshire during April 1997, in New York.

On Jan. 4, 2012, the Eliasberg Proof 1847 half did not sell. I was present when the lot was offered. My impression is that a commitment of at least $24,750 would have been required to compete for it. The reserve was too high.

Consider the Pittman-Kaufman 1847, which is also NGC certified ‘Proof-64.’ It sold for $27,600 on July 31, 2008 when coin markets were peaking, for $16,100 in April 2009, when coin markets were bottoming, and for $16,675 in August 2011, at which time it was part of the Dick Osburn Collection.

It did not make sense for the consignor to require that bidding start at nearly $25,000 for the Eliasberg 1847. Even a collector or dealer willing to pay $25,000 may have wished to ‘see’ someone else bid before committing. There is a good chance, though, no bidder was willing to pay more than $21,500 for this coin on Jan. 4, 2012.

I like the Eliasberg 1847. Proof silver coins from the 1840s tend to be somewhat dark. This is often, though not always, an important sign of originality. Furthermore, natural medium to deep toning, of expected colors, should be celebrated, not penalized as one grading service seems to do. (Please see my three part series on appreciating naturally toned coins.) In my view, this Eliasberg 1847 half is certainly a Proof, is more than attractive, has naturally toned, and merits a grade in the middle of the 64 range.

V. 1853 Arrows & Rays

The quarters and halves of 1853, with ‘Arrows & Rays,’ are among the most famous and curious of type coins. Only in 1853, quarters and half dollars featured arrows on the obverse (front) and rays on the reverse (back). These are generally determined to be one-year type coins, or at least need to be regarded as a one-year subtype of Liberty Seated Quarters and Half Dollars, respectively.

Arrows & Rays Half Dollars are thus highly demanded by collectors who are assembling type sets. This auction featured both a business strike and a Proof 1853 with Arrows & Rays!

The business strike is PCGS graded MS-66 and has a CAC sticker. It has been moderately dipped and has naturally retoned to some extent. Further, it is mildly lustrous and has very few contact marks. In my view, its grade is around the border between MS-65 and MS-66. I am less favorably inclined, though, towards very apparently dipped coins than are the graders at the PCGS, the NGC, and the CAC.

This business strike sold for $69,000, which John Albanese finds to be “a strong price.” Indeed, I did not expect this coin to realize even $57,500. It did, though, realize this exact same $69,000 price at the Jan. 2008 FUN auction, four years ago. So, it is not quite fresh. Also, market levels for rare U.S. coins in general were higher in Jan. 2008 than in Jan. 2012.

For this issue, the PCGS has graded thirteen as MS-65, four as MS-66 and two as MS-67. This total of nineteen ‘gems’ undoubtedly includes multiple counts of some of the same individual coins. The NGC reports sixteen in MS-66 and zero higher. I doubt that these sixteen are all different coins, maybe nine of them are different. I have seen other gem business strikes of this ‘Arrows & Rays’ Half Dollar issue that I prefer to the one in this auction.

Any “Proof” 1853 Arrows & Rays half is extremely important. According to Heritage cataloguers, just five or six exist. At the moment, I recollect seeing just one other of this issue.

The one in this auction is PCGS certified ‘Proof-65’ and has a CAC sticker. Bruce Morelan reveals “that this is the Nevada collection coin.” (Please click to read my article on The Spectacular Nevada Accumulation and the Morelan Collection of Type Coins. )

Bruce Morelan had included this half in his type set. For reasons apart from the present or future market prices of coins, Bruce decided to sell his half dollars and he consigned this ‘Proof’ 1853 to this auction.

The finish on the 1853 ‘Arrows & Rays’ halves that are certified as ‘Proofs’ is substantially different from the finishes on certified Proof Liberty Seated Half Dollars of most other dates from the 1840s to the 1860s. Plus, there are other significant differences. These 1853s are very interesting coins.

While these special 1853 Arrows & Rays halves (and corresponding quarters) are not business strikes, I have never felt certain that “Proof” is an appropriate term for them, though I have come to accept it. When I reflect upon many of the silver coins from the 1850s that the PCGS or the NGC has certified as ‘Proofs,’ especially those with some or most design elements (devices) that are not even close to Proof ideals, this coin and probably a few similar ‘Arrows & Rays’ Half Dollars qualify as Proofs, in accordance with the criteria employed by the PCGS and the NGC, respectively. Certainly, these are close to being Proofs, special strikings of some kind.

The Nevada-Morelan ‘Proof’ 1853 was dipped, maybe more than twenty-five years ago. It has been naturally retoning to an extent. Further, this coin has minor hairlines and contact marks, mostly on the obverse (front). In my view, this coin’s grade is in the ‘low end’ to middle part of the 65 range, somewhere between 65.25 and 65.4.

This Nevada-Morelan 1853 realized $184,000, a price that John Albanese says “is about right”! Although the PCGS price guide value is “$200,000,” I regard this $184,000 result as a strong price, well within the retail range.

In 2007, Heritage auctioned the Kaufman 1853 Arrows & Rays half for $149,500. It is NGC certified “Proof-66.”

VI. Proof 1857

The Proof 1857 half in this auction is PCGS graded Proof-65 and has a CAC sticker. “It is beautiful,” John Albanese exclaims. John reveals that he bid, or was planning to bid up to, $34,500 for this coin. It sold for $35,937.50.

This exact same coin was auctioned by Heritage on July 31, 2008, when coin markets were literally peaking. It then realized $28,750. The Numismedia.com retail guide value for this coin is “$15,310,” as of Jan. 30, 2012. Proof 1857 halves, however, are rare in all grades and are distinct condition rarities in 65 grade. Guide prices may not be even close to actual market prices as Proof-65 1857 halves do not trade very often.

In general, Proof 1857s are rarer than Proof Liberty Seated Half Dollars of the 1860 to 1865 time period, which are of the same ‘No Motto’ type. The current PCGS price guide value is $35,000 for this coin, though I did not check this guide value prior to the auction.

The PCGS has certified just two 1857 halves as ‘Proof-65’ and none have been PCGS certified at a higher level. The NGC has certified three as ‘Proof-65’ and just two higher. This is the only certified ‘Proof-65’1857 half that is CAC approved, and the CAC has not stickered one of a higher grade.

The point of citing such data here is to further demonstrate that it is very difficult to gauge the market value of and analyze the auction result for this specific coin. Overall rarity, condition rarity, individual attractiveness, place of this coin’s grade in the 65 range, number of people collecting Proof Liberty Seated Half Dollars ‘by date,’ and other factors may have contributed to the auction result.

VII. 1859 Business Strike

Business Strike 1859 halves are scarce in all grades. Further, these are extremely rare in MS-65 and higher grades. The one in this sale is NGC graded MS-66 and has a CAC sticker. While 66 is a fair grade, its grade is not even near the high end of the 66 range, in my view. The $19,550 result is very strong. I was expecting a price in the $12,500 to $15,500 range.

This 1859 business strike is one of the finest known representatives of this issue. Only two have been PCGS graded MS-66 and none have received a grade higher than MS-66 from the PCGS. Three have been graded MS-66 by the NGC and one has been graded MS-67. Not all the NGC graded MS-66 1859 halves, though, would be graded MS-66 by the PCGS.

The originality of this coin probably was a factor in its strong realization. The deep brownish-russet tones, and blue hues in some areas, are soothing. Furthermore, it has very few contact marks. This 1859 is a pleasing coin overall.

VIII. Proof 1860

The 1860 half in this auction is PCGS certified ‘Proof-67+ Cameo.’ It sold for $43,125. The PCGS price guide value is $43,500. This coin glistens.

Matt Kleinsteuber reveals that he “was the consignor” and was excited about this coin. “It is very pretty. It is devoid of hairlines. I made it,” meaning that Matt was the submitter when it was graded ‘67+.’ “It is one of the best ‘No Motto’ Proof Seated Half dollars that I have ever seen. I thought it would bring more money,” Kleinsteuber declares.

I did not expect it to realize a higher price. In my view, the $43,125 result is strong.

High quality, Proof Liberty Seated Half Dollars, in general, tend to be very attractive. I am surprised that more people do not collect them.

Collecting Proofs of the post-1866 types and/or business strikes of the pre-1866 types would be enjoyable, in my view. Furthermore, I am surprised that more people do not assemble type sets of Liberty Seated Half Dollars and/or coins of other Liberty Seated series.

Each collector may choose a grade range that matches his or her budget and tastes. Most circulated Liberty Seated type coins are not expensive. Even a type set of uncirculated Liberty Seated Half Dollars is not costly relative to prices in general for uncirculated 19th century U.S. silver coins.

©2012 Greg Reynolds

Many clients are inquiring about their self directed New Direction IRA account buying metals. If you’ve taken an interest in purchasing real precious metals with your retirement account, it’s important to know what types of metals are allowable and the qualifications that must be followed to satisfy the IRS’ guidelines. This article sheds light of many of the different options available to precious metal investors and covers some of the more specific information regarding specific types of coins and bullion products for IRA investments.

First, let’s cover the basics. Your self directed IRA can only invest in Gold, Silver, Platinum and Palladium. The keyword here is “invest”. Your IRA cannot buy collectibles – your IRA is only investing in the metal itself, not rare or attractive coins. The metal must be in a certain form (usually coins or bars) and/or of certain purity. The purity or fineness of the metal is how the quality of the metal will be measured for your IRA.

When most of us hear about gold investment we picture the 400 ounce gold bars we have seen in movies. Extraordinarily heavy (about 25 pounds), those bars are also quite the expensive items, particularly with the recent price increases in gold. IRAs are often priced out of the gold bar market, but, fortunately, other options exist. One other option is smaller units of bullion, provided they meet the fineness, or purity level, requirement. Another option is coins.

Initially, the IRS deemed all coins to be collectable and disallowed IRA investments in coins.

In the mid-1990s, after realizing that a 400 ounce gold bullion bar would be prohibitively expensive for most IRAs, Congress revised the rules and allowed IRAs to own certain coins in addition to bullion.

Generally these IRA allowable coins fall into two categories:

Category #1: Coins specifically listed in the Internal Revenue Code, and defined as NOT being collectable. These include only the American Eagle coins minted by the US Mint. Specific coins include:

• American Gold Eagles – Proof and Non-Proof

These coins are issued by the US Mint in both Proof and Uncirculated (non-proof) form. Because the coins are specifically listed as NOT being collectables, they are allowed in your IRA. Prices for Proof and Non-Proof Gold Eagle coins vary due to a number of factors including the availability, original production, and date.

Interestingly, these US minted coins are not of sufficient purity to classify them as bullion. They are only approximately 91% pure gold. The other material in the coin off sets the softness of the gold and makes the coin more durable. Gold Eagles arrive in one of 4 forms: 1/10, ¼, ½ and 1 full ounce coins.

• American Silver Eagles. – Proof and Non-Proof

These coins are issued by the US Mint in both Proof and Uncirculated form. Because the coins are specifically listed as NOT being collectables, they are allowed in your IRA in proof and non-proof form. Prices for Proof and Non-Proof Silver Eagle coins vary due to a number of factors including the availability, original production, and date. Silver Eagles land in only one form: 1 full ounce coin. They are of bullion fineness, but are only .999 (three nines) due to the addition of a touch of copper for added durability.

• American Platinum Eagles. Proof and Non-Proof.

These coins are issued by the US Mint in both Proof and Uncirculated form. Because the coins are specifically listed as NOT being collectables, they are allowed in your IRA in proof and non-proof form. Prices for Proof and Non-Proof Platinum Eagle coins vary due to a number of factors including the availability, original production, and date. The rarest of birds, the Platinum Eagles are minted in 4 forms: 1/10, ¼, ½ and 1 ounce coins. These are of .9995 fineness.

Any of the above coins which have been graded for condition by certification organizations and placed in tamper-proof plastic containers called “slabs”, will generally fall into the collectible category and thus are not allowed for IRAs. Recently a national certification service has initiated an authentication service for bullion coins. Authentication provides a guarantee as to the purity of the metal and the weight of the coin. While the authentication process does place the coin in a tamperproof container and give it a unique serial number, it is intended for verification only and does not move the bullion into the collectable category.

If you’re not sure about this, ask your self directed IRA provider or metals dealer. All US minted coins have nominal face values, but the true value is based on the value of the metal in the coin.

Category #2: Some coins meet the minimum fineness requirements but are not rare enough to receive collector attention.

• American Gold Buffalo coins. Non-Proof Only

First minted in 2006, they are of bullion fineness, .9999 fine (known as four nines). Note that the specially processed proof version of this coin is NOT acceptable, due to the treatment raising the value of the coin beyond the value of the metal.

• Gold Coins – .995+ note that gold is a soft metal (although heavy) and thus most typical minting includes other alloys to harden the coin. Therefore most minted gold coins intended for use as currency do not meet the fineness requirement.

• Silver Coins – .999+

• Platinum – .9995+

• Palladium – .9995+

Non-coin forms of metal, such as smaller gold bars, must be manufactured to meet specific weight specifications for the amounts of metal included and meet the above fineness requirements.

In addition to these American options, there are some coins issued by mints of other nations that do meet the fineness requirements:

• Australian Nugget (Kangaroo) Gold coins .9999 fine

• Australian Kangaroo and Kookaburra Silver coins .999

• Australian Koala Platinum coin .9995 fine

• Austrian Philharmonic Gold coins .9999 fine

• Austrian Philharmonic Silver coins .999 fine

• Canadian Maple Leaf Gold coins .9999 fine

• Canadian Maple Leaf Silver coins .9999 fine

• Canadian Maple Leaf Platinum coins .9995 fine

• Canadian Maple Leaf Palladium coins .9995 fine

• Mexican Libertad Silver Coins .999 fine

• Isle of Man Noble Platinum coins .9995 fine

Some examples of coins that don’t meet the fineness requirements are: Austrian Corona and Ducat, Belgian Franc, British Sovereign and Britannia, Chilean Peso, Columbian Peso, Dutch Guilder, French Franc, German Mark, Hungarian Korona, Italian Lira, Mexican Peso and Ounza, South African Krugerrand, Swiss Franc, and any coin that falls into the “Rare”, and thus collectible, category.

Again, if you’re not sure about the fineness, ask your metals dealer to verify it.

Next time, we will talk about the process of getting metals into your IRA or other tax sheltered account. Note that Health Savings Accounts, another plan that can be self directed, is also eligible to be self directed and purchase metals.

by Ross W. Bailey, From The E-Gobrecht – 2012 Volume 8, Issue 1
The Electronic Newsletter of the LIBERTY SEATED COLLECTORS CLUB

This article distills the lessons gleaned from my ten years of experience as an active buyer and collector of rare coins on eBay. Over that period of time, I’ve made many mistakes, and you, the reader, will benefit from this by hopefully avoiding making these same mistakes. My goal is to help you have a better buying experience on eBay, by buying as many coins as possible that are genuine, original and worth the prices paid. Also, although the target environment is eBay, these strategies can be easily adapted to other auction venues – Heritage, Stack’s-Bowers, etc.

Some Expertise

I am assuming that you know how to use the eBay search facility to locate listings of coins that are of interest, that you know how to track these listings using the “Watch this Item” facility within “My eBay,” that you are familiar with the mechanics of bidding, and that you have at least some rudimentary ability to grade the types of coins that are of interest to you. However, if you need any help with any of these features, contact me thru the E-Gobrecht editor and I will try to help you out.

Terms of Art

One term used to describe a rare coin is that it is “Original.” In U.S. numismatics, “original” means that the coin has not been cleaned, tooled, re engraved or messed with in any way, and that any departure of the coin from its mint state has happened naturally, in the form of circulation wear and toning. Buying a coin that is original and problem free should always be your goal.

Conversely, in European numismatics, and occasionally in the U.S., the term “Original” is used as a synonym for “Authentic.” I always use “original” in the U.S. sense. To convey authenticity, I use either “authentic” or “genuine.” When you come across an eBay listing of a coin that is described as original, it is important to understand which meaning applies. Sometimes, but not always, the seller’s meaning is clear from the context. If it isn’t clear, you can ask him.

Why Original?

Why is it important to stick to original coins when at all possible? Because the rare coin market says they are worth more. They are the only coins that PCGS and NGC will grade and encapsulate
.
All other things being equal, an original coin is simply worth more than one that has been cleaned or has some other problem. PCGS (Professional Coin Grading Service) will encapsulate a coin that is genuine but not original. However, they won’t grade it. NGC will only encapsulate it under their NCS service. ANACS will grade a coin that is not original, and will assign it a “Details” grade.

Getting Started

So let’s assume you have located an eBay listing of a coin that you are interested in. How should you approach it? First, you want to know if the coin is original and problem free. If the coin has been certified by PCGS or NGC, you know it was the grading service’s opinion that the coin is original. That counts for a lot.

If the coin was graded by ANACS (not a details grade), you know that ANACS thought the coin is original. This counts for something, but less than if the coin was graded by PCGS or NGC, as I have seen too many ANACS graded coins that have been cleaned.

But suppose the coin is raw. How do you tell if it is original, assuming the seller says nothing about originality in the item description? Unfortunately, even with a very good photograph under natural light, it is unlikely you will be able to tell if the coin is completely original and problem free. So your first step should be – ask the seller! The way I like to ask the question is as follows: “Has this coin been cleaned or had anything else done to it that would prevent it from being certified by PCGS or NGC?”

I ask the question this way regardless of whether or not I intend to get the coin certified. Note that what you are asking for is an opinion, not a guarantee that the coin will slab. How the seller responds to this question has a very important bearing on whether I will bid on the coin or not. Here are some of the responses I have gotten in the past.

1. I have no idea, I’m not an expert.
2. I didn’t clean it. I don’t know what happened to it before I bought it.
3. It may have been cleaned, I’m not sure.
4. It’s been cleaned. PCGS won’t certify it.
5. It hasn’t been cleaned and doesn’t have any problems. It should certify.

If the seller states point blank that the coin has been cleaned or has some other problem, I move on and look for another coin. You might be surprised how many sellers know about a coin’s problems, won’t mention them in the auction listing, but will cheerfully disclose the problems when asked. If the seller says the coin hasn’t been cleaned and will certify, I make my plans to bid, however I seldom get this response.

You will often get responses #1, #2, or #3 above, because many sellers are not professional numismatists, and simply don’t know what to look for to determine originality. Characteristics of cleaned coins include (1) the coin has a washed out, pasty look; (2) the coin is below AU in grade but is “white”, i.e. has no tone; (3) the coin has odd, unnatural looking tone (also a characteristic of artificial toning); (4) the coin has hairlines, indicating a cleaning. Unfortunately, it is very difficult to tell from a typical auction listing photograph whether or not a coin has any of these characteristics, which is why it is so important to have a return privilege.

Return Privilege and Photos

In U.S. numismatics, many if not most professional coin dealers offer an unconditional return privilege of from 3 to 30 days when they sell on eBay. (Sometimes, a return is not offered on coins that are certified.) The theory behind the return option is that, even with a photograph, you can’t really tell what a coin looks like until you get it in your hand.

For this reason, when I buy coins on eBay, I usually try to avoid coins where the seller does not offer a return privilege. Only when I am relatively certain about exactly what I am buying (for example the coin is certified), do I depart from this rule.

Having a return privilege is a powerful way to control your risk. When offered, a return option limits your risk to a round trip of shipping expenses. It allows you to bid in situations where you wouldn’t dream of bidding without it.

Have you ever seen a listing of a coin with a photograph that was so bad that it was like having no photograph at all? Your initial reaction might be not to bid, but if a return option is offered, and the coin seems from the description to be just what you are looking for, go ahead and bid. You are likely to win it for a lot less than if it had a good photograph, because a bad photo inhibits other bidders. The converse of this principle is also true. That is, when the coin’s photo is really good, showing all of the detail and the natural color of the coin, then bidding is likely to be very heavy. I sometimes find myself avoiding these listings simply because the bid price gets too high.

As far as the number of days for the return option, even one day is long enough for me in most instances, because I usually know within a few minutes of receiving a coin whether I want it or not. In those instances in which I decide to return a coin, as a courtesy I notify the seller immediately by email of my intent, and I put the coin back in the mail the same day I receive it.

Getting Coins Certified

I get most of the raw coins I buy certified by PCGS, or occasionally by NGC. Although I would like sellers to guarantee that their coins will certify, few sellers are willing to do so. However, if the return period on the coin is 30 days, that is long enough for me to submit the coin to PCGS under the “regular” service, receive it back from PCGS, and, if it doesn’t certify, return it to the seller.

This issue is most important to me when we are talking about very expensive, raw coins. In this case, when the return period stated in the listing is less than 30 days, I try to negotiate with the seller (before I bid) an extension of the return period to 30 days.

Also, I’ve found it best to be completely up front about what I am doing. That is, I tell the seller that I plan to submit the coin for certification, and return it if it doesn’t certify. I also tell the seller that my return is contingent on the coin grading or not grading, not on the numerical grade that PCGS assigns.

In other words, if PCGS grades it, I keep it, regardless of whether it comes back, for example, a VF35 or an XF40. I do this because I feel that the major risk is of the coin not grading at all, much more than the risk of getting a grade other than what I expected. I find that sellers are more apt to go along with me if the contingency is constructed this way.

Besides cleaning, there are other things that will prevent PCGS from grading a coin, for example artificial toning, rim bruises, scratches or any other type of damage. These problems are usually obvious from a decent photo, unless they are very minor. And if they are very minor, PCGS may go ahead and grade the coin.

Other problems include re-engraving (where someone tried to reestablish detail that had been lost from circulation wear), and tooling, usually performed in an attempt to “fix” a scratch or other problem. These latter two problems I find very difficult to identify. But fortunately, my experience has been that they don’t occur all that often.

Bidding – the Hidden Reserve

One of the more irritating things that sellers do is to place a secret reserve on a coin’s listing, with the opening bid some lower amount. Instead of a reserve of $500, you would think that they could simply make $500 the opening bid amount. The theory is that allowing bidders to bid below the reserve stimulates bidding activity. My suspicion is that just the reverse is true, that is, I believe that hidden reserves tend to inhibit bidding.

There is however a simple solution, which can actually turn this situation to your advantage. That is to simply ask the seller what the reserve amount is. My experience is that 80% to 90% of the time, sellers will respond to an email by disclosing the reserve amount. This is particularly true if the listing has run for a while with little or no bidding.

Once armed with the reserve amount, you can plan your bidding strategy. If the reserve amount seems to be reasonable, you can bid it. If it seems to be too high, you can plan to let the listing end, and then, if no one has won the coin, you can make the seller an offer at some price below the reserve amount.

In the latter situation, I will typically make the offer (using “Ask the Seller a Question”) a few minutes before the listing ends, due to the fact that eBay makes it difficult to contact the seller for an expired listing. If the seller likes your offer, it is simple enough for him to re list the coin with a “Buy it Now” at your price.

Bidding – to Snipe or not to Snipe

There are at least three schools of thought when it comes to bidding strategy.

The first is a “one-bid” strategy, and it is to bid as early as possible with the absolute highest amount you are willing to bid for the coin, and then to sit back and wait for the auction to end.

The second strategy is to bid early and low, then if you are outbid, bid a little more, and if you are outbid again, bid a little more, etc., etc. I find this to be a common strategy with novice bidders (i.e. low feedback score).

The third, also a one-bid strategy, is to bid the highest amount you are willing to go a few seconds before the listing ends. This strategy is referred to as “Sniping.” After ten years of experience, I can state unequivocally that sniping is the best strategy, because it affords you the maximum chance to win the coin, and at the lowest possible price.

The key aspect of sniping is that because your bid is made with only a few seconds left on the listing, nobody has a chance to bid in reaction to your bid. Thus sniping protects you against bidders employing bidding strategy number two. If you bid at any time other than a few seconds before the auction ends, bidder number two will see your bid and decide he can go a little higher, which can only have two possible results, both of them negative. Either you will be outbid, or else you will not be outbid, but will end up paying a higher price for the coin.

Conversely, sniping prevents bidder number two from reacting to you because he has no time in which to do it. Sniping also protects you against some of the bidders employing strategy number one. That bidder thought he was bidding his highest possible bid, and expected his bid to prevail. When he sees your bid, however, he decides he can go a little higher. Again, the key to sniping is that it prevents anyone from reacting to your bid by bidding again.

Bidding -

What Price to Offer or How High to Bid There is no hard and fast rule about how high to bid or offer for a rare coin. Part of the answer is very personal (How badly do you want it?). But even if you desperately want a particular coin for your collection, and you are willing to pay some premium, you still want to know that you haven’t paid substantially too much.

For U.S. coins, there are retail pricing guides that provide some guidance. These include the Red Book, PCGS Price Guide, and Numismedia. The only price guide I am aware of for World coins is Krause, but I find Krause’s prices to be out-of-date most of the time and therefore of limited use.

For U.S. coins there is a good bidding strategy that relies on the pricing guides. This is to use the guides to determine what a coin is worth, and then bid 10 to 20 percent above this value. You can feel better about this strategy if you try to limit it to coins which you feel for some reason (e.g. outstanding toning, pedigree) are worth a premium over retail.

The reason this strategy works is that there are a substantial number of bidders out there who adhere to the price guides pretty strictly, and won’t bid above them. So by going 10 to 20 percent above the retail price, you eliminate a lot of the bidding competition.

You will notice that I refer to retail pricing guides and have not mentioned wholesale guides like Greysheet. My experience has been that most bidders use retail guides, and not wholesale guides, to base their bidding strategy. Consequently, if you base your bidding on Greysheet, you will likely be outbid most of the time.

For gauging how high to bid for world coins, I am afraid there is no substitute for experience. I rely on Krause not to decide how much to bid but to establish a ballpark or an order of magnitude, i.e. is this a $300 coin or a $3,000 coin. To decide how much to bid on Russian rubles, I rely on my years of experience, and auction records. I also rely on one dealer and three or four other collectors for advice, all of whom know much more about rubles than I do.

Avoiding Counterfeit Coins

Although there is no absolutely foolproof way of avoiding bogus coins, there are a few things you can do to protect yourself. First, in the case of coins sold within the U.S., the Hobby Protection Act requires any non-genuine coin to be stamped “Copy” on either the obverse or reverse. In my ten years of collecting and bidding on eBay, I have only been stuck with one counterfeit U.S. coin that I know of, a bust dollar, and I didn’t know it was counterfeit for five years after I bought it. When it came time for me to sell it, ANACS gave me the bad news.

Since I had bought the coin from a reputable U.S. dealer, and since virtually all reputable U.S. dealers offer a lifetime guarantee of authenticity, I was able to recoup my purchase price from the dealer from whom I bought it. However, I lost all of the profit from the increase in price that the coin would have generated had it been genuine, which was thousands of dollars.

The key to avoiding most counterfeits is to always consider the source. Thus, there is a dealer from China selling Russian rubles (which I collect). He has recently listed five 18th century rubles, all of them rare issues worth thousands, each with an opening bid price of $49.95, each offered with no reserve. Red flag? Of course, this is an easy one. Think to yourself, “where could he have gotten them?”

There is no good answer. Even without the knowledge that there is a flood of well made counterfeit coins emanating from China, this is an easy one to detect. I’ve gotten to the point that I simply will not bid on any coins listed by sellers located in China. It simply isn’t worth the risk. Thus my key for avoiding counterfeits is to try to avoid high-risk sellers. This is because I don’t have the skill to detect a well made counterfeit coin after I have it in hand. That’s the job of the grading services. I know you can weigh it and do other things, but I prefer to rely on a strategy that keeps you from buying likely counterfeits (consider the source), rather than a strategy that detects counterfeits after you have already purchased them.

Despite the strategy of “consider the source,” there may come a time that you purchase a coin whose authenticity is in question. This happened to me a couple of years ago when I purchased a ruble for about $900 from a seller in Romania. I should have simply not bid on the coin because I was somewhat suspicious concerning authenticity, but it was a date I really wanted, so I bid anyway, and won the coin.

However, before I bid I contacted the seller and told him that if I won the coin, I would be submitting it to PCGS and would be returning it if it turned out to be a fake, and without his agreement to accept these terms I would not bid. Of course the seller assured me that the coin was genuine (based on what?). PCGS however, ruled the coin was counterfeit, so I returned it, and thus limited my loss to two round trips of shipping expenses – not a small amount, but nowhere near $900.

Then there is the seller in Germany selling on the German eBay web site, www.ebay.de. He sells rubles which he claims he found in his garage, so he knows nothing about them and therefore cannot guarantee their authenticity. What a story!

Of course I believe he knows darn well his coins are bogus, and tries to prey on buyers who will buy his coins in the hopes that they are genuine. It is a cardinal rule that I will not bid on or buy a coin from a seller who will not guarantee authenticity.

Negotiating the Price

Whenever a seller lists a coin that I want with an opening bid amount or a reserve that is substantially above the market price, I see an opportunity for negotiation. When I see this situation, I expect the coin not to sell during the auction process. Some-times I will wait until the listing has almost run out of time (See Bidding – the Hidden Reserve above), or sometimes I will send an immediate email to the seller, which states “If this coin does not sell, I would like to offer X for it”.

Both the substance of my lowball offer, and the fact that the offer is made early in the listing sends a message to the seller, without stating it explicitly, that I consider his Opening bid price/Reserve price/Buy-it-now price to be way too high for the market, and that he shouldn’t expect to realize much more than I am offering. Of course someone may still bid and make me look a little silly, but more often than not no one bids, and the negotiation begins.

In this situation, you should never be afraid to make a lowball offer for fear of insulting the seller. And it is this initial offer that is critical to a successful negotiation. Likewise, the seller’s initial response to your offer will tell you pretty clearly if you have gauged the situation correctly, and whether or not the negotiation is going anywhere. If the seller responds with a counter-offer that is only a token amount below his initial price, then either he has not given up on getting a huge profit, or else he paid way too much for the coin himself, and is now stuck. (There is a third possibility, namely that you do not have as firm a grip on the market as you had thought.) Whatever, the negotiation is now over.

If on the other hand, the seller counters with a price that is substantially below his initial price, you have basically won the negotiation. It is now only a matter of either accepting the counter offer, or countering yourself to try to get the price even lower. I just completed a negotiation for a ruble being offered by a seller in Luxembourg for a buy-it-now price of $650. My sense was that this coin was worth somewhere in the $300-$400 range, so I made an offer of $325, exactly half of asking price. The seller countered $440, I countered $350, the seller countered $415, I countered $375 (my last offer, since eBay for some curious reason will not allow you to make more than three offers), the seller countered $390, and I accepted. That’s 40% below the initial buy-it now price.

by Louis Golino for CoinWeek

Late last year the 25th anniversary American silver eagle sets that were released at the end of November dominated the modern U.S. coin market.

There was literally a frenzy of interest in these sets. Thousands of opened, unopened, and graded sets traded on e-Bay and elsewhere, and for a while prices were rising almost daily, as is the usual pattern following the sell-out of a hot Mint item.

Interest in the sets remains high, and many were bought and sold at the recent FUN show held in early January in Florida, but the frenzy seems to have cooled a little bit, as collectors turn to other issues and prices begin to stabilize.

Price performance

Graded sets, especially those with a perfect MS/PF-70 grade for each of the five coins in the set, have been eagerly sought by collectors. But as I suggested would happen last fall, prices for 70 sets have fallen dramatically from what they were bringing when the sets were first released.

Raw sets have been bringing approximately $750, but many retail coin dealers charge $850-$1,000. I have noticed that many sell out quickly of their stock of sets.

Sets graded MS/PF-69 are now trading at the same levels, or just above, what raw sets bring. Not long ago they sold for a premium of a couple hundred dollars over a raw set.

Prices for 70 sets vary quite a bit. NGC sets sell for $1100-1300 on e-Bay, while PCGS sets are bringing $1400-1500 typically.

With all the sets being graded it will be interesting to see how many fresh, original raw sets remain in several years.

Prices for the 2006 20th anniversary sets recently saw a nice bump. I suspect this is because newer collectors who bought the 25th anniversary sets found out about the earlier sets and decided to get them too.

With more buyers and the same supply of sets (250,000 total but with no estimates of how many raw sets remain), prices went higher. Raw sets are now fetching close to $500, whereas before the release of the 25th anniversary sets they could be had for $400 or less.

I predict that unopened 25th anniversary sets, which are eligible for submission to the grading services, will be remain a hot commodity, and prices for them may eventually reach almost the same level as 70 sets. An unopened box of five sets recently sold for $4600, or $920 per set.

The Mint and grading companies

Meanwhile, tempers remain flared among many collectors, especially towards the Mint, but also to a lesser degree towards the leading third party grading companies, especially because of their requirement to ship the entire unopened box and then pay a special fee to have it returned.

Because so many sets are getting 70 designations values for 70 sets and singles have dropped significantly from initial levels.

On the other hand, since we can not check the quality of unopened sets prior to submission to the grading companies, it is a real gamble to submit them in hopes of getting the top grade. If one receives 69′s or less, it is hardly worth the considerable expense and trouble of sending them in.

Another important point is that the percentage of sets that have been graded 70 by NGC vastly exceeds those graded 70 by PCGS even though retail prices are not always different for the two.* For example, at Modern Coin Mart (http://www.moderncoinmart.com) the NGC and PCGS sets both sell for $1450. Eventually, prices for PCGS 70 sets should be much higher than NGC sets.

The U.S. Mint continues to be the subject of almost constant criticism from collectors who were unable to order a set from the Mint, or who did, but who feel the Mint botched the release of these sets.

There is a broad consensus that a household limit of five was too high for a set that appealed to so many collectors. Views are more diverse on whether more sets should have been made. But I think we should also give the Mint credit for producing a beautiful set that should perform well in the coming years.

2012-S

A major development that emerged from the recently released U.S. Mint Annual Report for 2011 is that the Mint is considering releasing another San Francisco burnished coin, a 2012-S eagle. The report says the Mint officials look forward to expanding the burnished eagle “S” series this year.

Some collectors were upset by this news because it means only one coin, the 2011 reverse proof, is now unique to this set. Moreover, if there are more “S” mint coins, and since there was a reverse proof in 2006, no coin in the set would be totally unique.

But first of all, it is not a done deal that the Mint will issue more “S”mint eagles. And second, what really matters is the mintage levels rather than the uniqueness of coins, at least in my view.

Since the mintage of the 2011-S remains at 100K it will still be the lowest mintage non-proof silver eagle issued. Unless the Mint issues something later with a lower mintage, this coin will remain a major key.

I would recommend holding on to any sets you own for the long haul if you can, and don’t worry if they start an S mint series. If there is a 2012-S, it will undoubtedly sell several hundred thousand. Besides, who knows what they will do for the 30th anniversary, though I doubt it will have a mintage lower than 100K after all the flack about the 25th anniversary sets.

One key factor that should help support higher prices for the 25th anniversary sets is the fact that so few people own the entire mintage. The Mint has indicated that the average order was for 3.7 sets. Factors in the dealers and e-Bay entrepreneurs who managed to get far more than 3.7 sets, and this means that something like 20,000, or more likely even fewer people, own all 100,000 sets.

A significant number of them appear to be owned by collectors who plan to hold on to their sets for the long haul, even if they bought multiples, and an ever-expanding number of silver eagle collectors, should mean higher price levels in the coming years.

Finally, there is the issue of possible new varieties and error coins from this set, which I will address in a separate article soon.

*To illustrate the point I examined the population information on the PCGS and NGC web sites for two of the coins in the 25th anniversary sets. At NGC 72% of the 2011-W coins received MS-70, whereas at PCGS only 54% were given the top grade. For the 2011 bullion coin, the NGC number was 70%, and the PCGS figure was 52%. The figures vary from coin to coin in the set, but the pattern is there. It is clear that PCGS gave out the top grade much less often than NGC.

Louis Golino is a coin collector and numismatic writer, whose articles on coins have appeared in Coin World, Numismatic News, and a number of different coin web sites. His column for CoinWeek, “The Coin Analyst,” covers U.S. and world coins and precious metals. He collects U.S. and European coins and is a member of the ANA, PCGS, NGC, and CAC. He has also worked for the U.S. Library of Congress and has been a syndicated columnist and news analyst on international affairs for a wide variety of newspapers and web sites.