By Tom LaMarre, Coins Magazine October 19, 2010

The U.S. Mint has struck billions of dimes in the past two centuries, from the original Flowing Hair version of the 1790s to today’s Roosevelt dime. Unquestionably, however, the greatest dime of all is the 1894-S Barber dime.

Coin dealer B. Max Mehl called the 1894-S dime “the rarest U.S. dime and probably the rarest small silver coin in the world.”

Only 24 examples were struck, for reasons which have been the subject of conjecture and speculation almost from the time they were “new.” Now there are an estimated nine survivors, any one of which is capable of selling for more than $1 million.

In July 2007, an 1894-S dime described as the finest known, graded Proof-66 by the Professional Coin Grading Service, sold for $1.9 million.

The Barber dime is named for its designer, Charles Barber. It had been around for only two years when the 1894-S dimes were struck. “The new coins out from the Mint this year have run against various objection based on aesthetic grounds, especially the dime,“ the March 24, 1892, issue of the Olean Democrat said.

The design may not have been an artistic masterpiece, but it did the job. By 1894, everyone was pretty much used to it. The novelty was gone, and so was any interest which might have been shown by hoarders.

The Barber dime, quarter and half dollar made their debut on Jan. 2, 1892. On Jan. 25, the Treasury Department ordered the Philadelphia Mint to suspend production of half dollars so it could focus on turning out more dimes. But the situation was only temporary.

The Treasury Department had millions of dimes in its vaults at the close of 1893. Demand for the coins was light, partly because of the Panic of 1893. As a result, dime production fell sharply in 1894 at all of the mints—San Francisco, New Orleans and Philadelphia.

San Francisco saw the greatest drop, even though the dime was the smallest denomination struck there. The San Francisco Mint had turned out more than 2 million dimes in 1893.

The financial panic that began late in 1893 changed everything. The Jan. 27, 1894, issue of the Woodland Daily Democrat joked, “Nowadays dimes are being drawn from circulation. At least the people who are forced into begging them report that to be the state of the money market.”

Because of the poor economy, the San Francisco Mint had 1.5 million dimes in storage at the end of fiscal 1894. That was on June 30.

In October, a newspaper reported Mint Director Preston had gone to Philadelphia to speed up the production of “fractional” silver coins—denominations smaller than the silver dollar. Demand was said to be greater than the supply available, especially in the West, which was served by the San Francisco Mint.

Nevertheless, San Francisco did not resume full-scale production of dimes until 1895, when it turned out more than 1.1 million. “Again, 10-cent pieces seem to be greatly in demand,” the New York Sun reported. Surviving 1894-S dimes have prooflike characteristics, something which is not unusual for coins struck from new dies.

The method for striking dimes had been described in a newspaper article several years earlier. First, silver bullion was melted into two-pound bars. The bars were then run through large rollers which flattened them into strips of dime thinness.

The strips were treated with tallow to prevent scratches. Planchets were cut from the strips and fed into the coinage presses by automatic machinery at the rate of 100 a minute.

The design and edge reeding were impressed at the same time, and the finished coins were dropped into a container and ready for counting.

Special trays were used to count the dimes. They had raised ridges, spaced at the exact thinness of a dime. The counter dropped coins into the tray and shook it rapidly to fill it and remove any excess dimes.

The 1894-S dimes were probably not subjected to such casual treatment. Although the two dozen examples were listed in the Mint director’s annual report, they attracted little attention. Most collectors were interested only in a coin’s date and design type, not mintmarks. There were no newsstand coin magazines or newspapers.

Some collectors did write to the San Francisco Mint, asking to purchase examples of the 1894-S dime. But they were told the coins were not available.

The question is: What happened to the rare dimes? Several theories have been suggested. One of the oldest is that when the books of the San Francisco Mint were being closed at the end of fiscal 1894, a shortage of $2.40 was discovered. Supposedly, 24 dimes were struck to make up for the deficiency.

The California Midwinter International Exposition ran from Jan. 27 to July 5, 1894, in San Francisco’s Golden Gate Park. Newspaper publisher Michael deYoung came up with the idea of the fair. It included some exhibits from the World’s Columbian Exposition held in Chicago the previous year. Is it possible the 1894-S dimes were struck as presentation pieces for visiting dignitaries?

A more widely held belief is that the superintendent of the San Francisco Mint, John Daggett, ordered the coins struck. Daggett was born in New York and moved to California in 1852 during the gold rush days. By the 1860s, he owned the Black Bear mine and was active in politics. He was superintendent of the San Francisco Mint from 1893 to 1897. Daggett retired to Black Bear, Calif., in 1897 and died there in 1919.

Daggett may have ordered the 1894-S dimes struck for himself and seven banker friends. According to the story, each of the men received three dimes. Legend has it that Daggett gave his 1894-S dimes to his daughter Hallie and told her not to spend them because they would someday be valuable. But it was a hot day, and Hallie supposedly spent one of the dimes for ice cream on her way home.

A newspaper article that was reprinted in the February 1951 issue of Numismatic Scrapbook Magazine seemed to corroborate the story of Hallie Dagget’s dimes. The article reported the sale of two 1894-S dimes. It also mentioned the legend that in 1894 “a banker in Ukiah” gave three 1894-S dimes to his daughter, who visited an ice cream parlor on the way home. Ukiah is located about 100 miles from San Francisco.

Earl Parker, a prominent San Francisco rare coin dealer, purchased the two dimes mentioned in the Numismatic Scrapbook Magazine article. Later, the inscriptions on one or more custom-made holders for the 1894-S dimes perpetuated the legend of the Daggett dimes.

Hallie was 15 years old when the 1894-S dimes were struck—hardly the “little girl” of the ice cream story. In 1913 she became the U.S. Forest Service’s first woman “fire lookout.” Assistant fire ranger M.H. McCarthy recommended her for the job. In a May 1913 letter to Klamath Forest Supervisor W. B. Rider, McCarthy wrote:

“The novelty of the proposition which has been unloaded upon me, and which I am now endeavoring to pass up to you, may perhaps take your breath away, and I hope your heart is strong enough to stand the shock. It is this: One of the most untiring and enthusiastic applicants which I have for the position is Miss Hallie Morse Daggett, a wide-awake woman who knows and has traversed every trail on the Salmon River watershed, and is thoroughly familiar with every foot of the District.

“She is an ardent advocate of the Forest Service, and seeks the position in evident good faith, and gives her solemn assurance that she will stay with her post faithfully until she is recalled.”

Hallie worked at Eddy’s Gulch Lookout Station, atop Klamath Peak, from 1913 until the late 1920s. Her annual tour of duty began in June and lasted four to seven months.

Hallie died in 1964 in Etna, Calif., never having verified the 1894-S dime legend. The “ice cream dime” story was not popularized until the early 1970s, by numismatic writer James Johnson, who owned a worn 1894-S dime often cited as the “ice cream dime.” Gimbel’s coin department had purchased it over the counter in 1957. Johnson sold it in 1981 for $27,500.

Another circulated 1894-S dime turned up in circulation in 1911 and was acquired by a collector named Romito. It sold for about $35,000 in 1990 and is now graded About Good-3.

In a letter published in the February 1949 issue of The Numismatist, a Texas collector, Louis Goodwin, said his prize possession was an 1894-S dime in “very good” condition. Goodwin said he had owned the coin for more than 20 years.

The April 1956 issue of the “Koin Klubber,” published by the Honolulu Coin Club, reported an 1894-S dime had been discovered in Hawaii. Apparently the claim was not verified, but the idea was not as far-fetched as it might have sounded. San Francisco was the departure point for Hawaii-bound travelers, and it was in 1894 the Republic of Hawaii was created.

Possibly the earliest published reference to the 1894-S dimes, aside from the listing in the Mint director’s annual report, was an article in the San Francisco Call. It was reprinted in several newspapers across the country in 1895. Among them was the Nov. 8, 1895, issue of the Kendallville (Ind.) Standard:

“A Valuable Dime. Whoever has a dime of 1894, coined by the San Francisco Mint, has a coin for which $5 has already been offered, and when all the facts are known regarding its scarcity, it is not unlikely it will command a much higher premium.

“Inquiry at the Mint elicited the information that during the fiscal year of 1894 only 24 dimes were coined at the San Francisco Mint. How this came about was told by Chief Clerk Robert Barnett.

“‘All incurrent subsidiary coins, viz., those containing other than the design now being used, when received at the sub-treasury, are not again allowed to go into circulation, but are sent to the Mint to be re-coined with the current design.

“‘In the course of the year 1894 we received a large sum in these coins, but having an ample stock of dimes on hand, it was not intended to coin any of that denomination in 1894.

“‘However, when nearly all of this subsidiary coin bullion had been utilized, we found on our hands a quantity that would coin to advantage only into dimes, and into dimes it was coined, making just 24 of them.

“‘My attention was first drawn to the matter particularly by the receipt of a letter from a collector somewhere East requesting a set of the coin 1894. In filling this order, I found there were no dimes of that date on hand. Subsequently I received quite a number of similar letters, and in each case was, of course, unable to furnish the dimes.

“‘Plenty of dimes were coined that year at the Philadelphia and New Orleans Mints, but there are many collectors who accumulate the coinage of each Mint, as each has its distinguishing mark. Those coined here bear a letter ‘S’ under the eagle. New Orleans used the letter ‘O,’ and Carson City the letter ‘C,’ while Philadelphia coins are identified by the absence of the letter. “‘We receive each year about 50 requests from coin collectors for coins, mostly for those of silver.’ ”

Actually, there was no eagle on the reverse of the dime. The “S” mintmark appears below the wreath on the reverse. Furthermore, it was the Charlotte Mint—long defunct by 1894—which had used a single “C” mintmark. Carson City used a “CC” mintmark, the only two-letter mintmark in the United States.

The San Francisco Mint’s June 30, 1894, closing report on the amount of silver bullion on hand showed a total in an exact round figure. It was an unusual occurrence, to say the least. The San Francisco Mint had received dime dies in January 1894, but had not used them. Nor were any dimes struck in the final six months of 1894 for circulation, after the 24 1894-S dimes were struck to even out the bullion account.

The Sept. 12, 1895, issue of the Bucks County Gazette noted that “plenty” of dimes were struck at the Philadelphia and New Orleans Mints in 1894. But it said there were “collectors who accumulate the coinage of each Mint,” and the 1894-S dime was a rarity.

In 1900, Augustus G. Heaton bragged that he owned the only known 1894-S dime. “The San Francisco Mint takes proudly to itself the sensation of later U.S. coinage in striking but $2.40 worth of dimes, or 24 pieces in all, in the year 1894,” he wrote in the March 1900 issue of The Numismatist. “Of these, the writer possesses the only one known to the numismatic world.”

But another 1894-S dime was reportedly found in circulation later the same year. George Heath wrote in The Numismatist:

“J.C. Mitchelson of Kansas City, who has been spending much time in San Francisco, writes that he has uncovered an 1894-S dime. Mint authorities there inform him that while 24 were originally struck, only 14 went into circulation, the remaining 10 being re-struck. None remain in the Mint.”

The only corroborated information in the report was that 24 1894-S dimes had been struck and none were left at the Mint. Mitchelson bequeathed his collection to the Connecticut State Library, but apparently there was no 1894-S dime.

Writing in The Numismatist in 1928, Farran Zerbe repeated the legend the 1894-S dimes had been struck to balance the books:

“To close a bullion account at the San Francisco Mint at the end of the fiscal year, June 30th, 1894, it was found necessary to show 40 cents, odd, in the year’s coinage. The mint not having coined any dimes during the year, the dime dies were put to work, and to produce the needed 40 cents, 24 pieces were struck, any reasonable amount of even dollars over the 40 cents being readily absorbed in the account. It has been stated that at the time no thought was given by the Mint people that a rarity had been produced, it being supposed they would, as always in the past, be ordered to coin dimes before the close of the year. It so happened that no dime coinage was ordered and the unintentional error was not realized until the year’s coinage record was closed.”

Citing information he said was obtained at the San Francisco Mint in 1905, Zerbe wrote that “Mint people” obtained two or three of the coins and the rest were supposedly placed in a bag with other dimes released for circulation. The story was never verified.

Thanks to information unearthed by researchers and authors Richard G. Kelly and Nancy Oliver, it is known a total of five Special Assay 1894-S dimes were sent to Washington from the San Francisco Mint—two on June 9, 1894; two additional examples on June 25; and a last piece on June 28.

It’s possible some of the 1894-S dimes were kept as souvenirs by members of the Assay Commission, although assay coins were supposed to be melted after they were tested. Sometimes assay members substituted other coins.

Regardless of the real explanation for their existence, there was no denying the rarity of the 1894-S dime. It was the subject of an item in the Asheville Citizen, reprinted in the March 5, 1909, issue of the Greenville, S.C., Herald-Journal:

“Valuable Dimes. That dimes bearing the date of 1894 and the letter ‘S’ are indeed scarce is evident from the fact that although the Citizen some weeks ago published that a dime of this description is worth $50, no one has claimed to have located one of them.

“But sundry other dimes have been brought in by people who inquired if they were of value to coin collectors. Some showed the 1894 date but bore no S, while others were stamped with an S, but were not coined in 1894.

“The S indicates that the coin was minted at San Francisco.”

One of the earliest coin price guides to list the 1894-S dime was C.H. Shinkle’s U.S. Coin Values and Lists, a thin booklet published around 1910. Shinkle, a Pittsburgh rare coin dealer, valued the rare dime at $50 and included it in a “List of Rare U.S. Coins.”

In 1937 a reader asked The Afro American newspaper what his 1894 dime was worth. The answer? $200 or $300 if it was struck at the San Francisco Mint. However, the coin’s owner was advised that if his coin was from New Orleans or Philadelphia, it was worth only face value.

In 1949, a classified ad in the Chicago Tribune offered $500 for an 1894-S dime. Six years later, another ad offered $1,000.

Some unusual advertising campaigns in the 1960s kept the 1894-S dime in the public eye. In 1962, a car dealership’s newspaper ad said, “Find an 1894-S dime and this car is yours.” The car was a new Plymouth Valiant, and the ad stated, “This is not a contest.”

In 1965, Reno Dodge advertised a new car for only 10 cents. The catch was that it had to be an 1894-S dime.

In the long run, neither offer would have been a good deal. Today, the value of the finest 1962 Plymouth Valiant or 1965 Dodge is insignificant compared to the price tag for an 1894-S dime.

The amount of 1894-S dime information available has also increased since the 1960s. Based on the most reliable source—the chief coiner’s explanation in 1895—the 1894-S dimes were struck to use up the San Francisco Mint’s supply of silver for re-coinage.

Some 1894-S dimes were used for assay testing, refuting the theory 24 dimes were divided equally among Superintendent John Daggett and seven friends.

But it’s also certain at least a few 1894-S dimes were spent, including one that might have been Hallie Daggett’s famous “ice cream dime.”

The figures have changed—from $5 to more than $1 million—but the sums commanded by 1894-S dimes continue to make headlines.

Nothing less would be worthy of the “World’s Greatest Dime.”