When asked about unusual US coin compositions, a numismatist might mention 75% pure three-cent silvers, steel cents, or war nickels. The strangest coin make-up, however, is also the most common: the three-layer clad planchets we find in today’s pocket change. This metal sandwich has two copper-nickel layers as the bread and a pure copper layer as the filling. No other nation minted three-layer coins like this, so why did we?
The answer lies with vending machines. Vending machines use electrical tests such as resistance to verify the genuineness of coins. As the United States transitioned from silver to base-metal coinage in the 1960s, engineers designed a coin blank with the same electrical signature as a 90% silver coin. That is, a cigarette machine designed to accept silver quarters would also take clad quarters.
Because the United States is friendlier towards business than most other nations, the Treasury chose to incur the cost of the transition instead of requiring the owner of that cigarette machine to make costly modifications. There are parallels in other countries, such as when Britain changed the threepence from a featherweight silver coin to a sturdy brass piece in 1937 to accommodate bus and trolley fare boxes. Most coin issuers, however, change compositions and leave it up to businesses to adapt and pay for the change.
Today’s vending machines still use electrical sensors. With no need to accommodate silver and with better electronics, Coinstar and other machines now reject the occasional silver coin they encounter. The legacy of those silver coins, however, still exists in the clad sandwich coins that handle our everyday business.
The Four Key Dates in United States Coin Collecting
By David Schwager
Reprinted from COINage magazine January 2013
This article was the basis for the presentation at the March 12, 2013 meeting.
Every collector knows the experience of looking for a key date to finish a series. These coveted coins bring our sets from ordinary to extraordinary, expanding and permanently changing our collections. This article examines key dates not in US coins, but in US coin collecting. Events in these years expanded and permanently changed the way we collect coins in America.
1857 – Collectors get organized
A few Europeans began saving mint state coins as early as the Renaissance. At the time the US Mint opened its doors in 1793, however, there was almost no interest in numismatics in the United States. The Mint, for example, did not save even one specimen of its 1793 issues. Most high grade 18th century American coins existing today came from the cabinets of British collectors who visited Philadelphia and requested uncirculated examples. For the first half century or more of our nation, there were no full-time coin dealers, with only scattered records of coin sales by art or antique dealers, or as estate liquidations. The few collectors had no national organization and were likely to meet other coin enthusiasts only in the largest eastern cities.
Rising copper prices in the 1850s prompted the United States to seek an alternative to the venerable and heavy large cent. In 1857, after one month of production, the US Mint struck the last large cent and began production of the lighter and more economical Flying Eagle small cent. Having for the first time the opportunity to sell a coin to the public at well over its metal value, the government issued unprecedented numbers of coins. From 1850 to 1856, the mint issued from 1.6 million to 9.9 million cents per year, averaging about 5 million, or much less than one coin for each of the 23 million people counted in the 1850 census. Foreign coins were common and US coin collecting suffered from the lack of US coins. From 1857 to 1860, in contrast, mintages exploded to 18 million or more, peaking at 36 million cents in 1859. The government was finally making enough coins for the growing commerce of a growing nation.
1857 Flying Eagle cent
Image source: Heritage Auctions
More coins meant more coin collectors. Most enthusiasts start by saving coins from circulation. The average American now saw enough coins, and more importantly, enough new coins, that it became practical to use circulation finds to build a collection. Unlike other older coppers often seen in conditions below Good, most 1857 large cents are Extremely Fine or better. This shows that the public quickly pulled them from circulation as curiosities. The 1857 and 1858 Flying Eagle cents were also saved in large numbers and easy to find today.
Their curiosity aroused by the disappearance of the large cents and half cents, a few casual accumulators became earnest collectors, and the key date continued into the following year. In 1858, several New York City collectors founded the first national coin association, the American Numismatic Society, which still exists today. The ANS built a collection of numismatic items, but its primary mission, like other learned societies, was research and scholarship. The society publishes books and journals, supports numismatic scholarship for researchers in a variety of fields, and has what may be the most important numismatic library in the world, with more than 100,000 items.
These new collectors also began to support professional coin dealers, the first of whom was Edward Cogan of Philadelphia, who turned from art dealing to the coin trade in 1858. Because collectors were still scattered, he conducted most of his business through mail auctions. Several newspapers reported on his November 1858 mail auction of 77 lots of US cents bringing a total of $128.63. Although the value seems low today, interest in US coppers was still a curiosity to many people and Cogan felt that the publicity established his reputation. Although he estimated that his potential customer base included only about 100 serious collectors when he opened the store, the business expanded in the following years and Cogan even issued a “store card” token, an 1860 piece similar to the Civil War tokens that would become common a few years later. In 1867, after the war ended and only 10 years after the end of the large cent, another dealer believed the United States held several hundred serious collectors.
The mint began to serve those serious collectors directly when, in 1858, it began offering proof sets to the public for the first time. Although the US Mint made proofs earlier, they were struck one by one for dignitaries, government officials, or those with Treasury or Mint connections. Now the Mint offered proofs by mail to anyone who wanted them. Three dollars bought a set from the cent through the silver dollar, a modest premium over the face value of $1.94 (adding the face values of the silver dollar, half dollar, quarter, dime, half dime, three-cent silver, and cent). Gold proofs were sold separately. Despite the bargain of this initial set, only 80 collectors chose to buy. The mint sold proofs on and off over the years, but these 80 sets were the ancestors of the millions of US proof sets now sold annually.
1934 – Collecting for the people
Technology changed immensely between 1857 and 1934. In the narrow field of coin supplies, however, collectors saw no advances. Options for coin storage were still cabinets (expensive), loose in boxes (no protection), or envelopes (can’t see the coins). Although numismatics had continued to expand in the 19th and 20th centuries, it was still somewhat of an upscale pastime practiced more often by educated people, many of whom continued to focus on Greek and Roman coins.
In 1934, an engineer named Joseph Post changed the hobby forever when he invented the coin board or “penny board.” (To picture a coin board, think of the familiar cardboard coin folder opened up into a single 11” x 14” sheet with no cover.) Post brought the prototype to Whitman Publishing to have them mass-produced, believing their expertise in jigsaw puzzles and board games made them a good candidate as a manufacturer. Instead, Whitman bought the rights from Post and published the boards themselves. Marketed as a family leisure activity, like Whitman’s other products, the boards were an immediate hit and, as David W. Lange, author of Coin Collecting Boards of the 1930s and 1940s notes,
“The introduction of coin boards priced at just 25 cents apiece is what made coin collecting a popular hobby for both adults and children of average means. The boards were for sale in so many retail and discount stores that no one could fail to see them, and the simple pleasure of filling all the holes became a challenge that took its place alongside jigsaw puzzles and similar amusements that sustained Americans during the lean years of the Great Depression. Many prominent figures in numismatics during later years were introduced to the coin hobby in this humble manner.”
The coin board, which gradually evolved into the coin folder beginning in 1940, established date and mintmark sets as the primary goals of US collectors. A board combines a set collector’s needs into a single object as storage, guide, and motivator. The board shows at a glance what the collector has and what he needs, also telling the owner what coins exist in a series and giving a mintage for each as a rough indicator for scarcity. The main item missing was a price guide and, also in 1934, coin dealer Wayte Raymond of the United States Coin Company published the first edition of the Standard Catalog of United States Coins and Currency. Earlier price guides were published irregularly, included only auction prices, or, like B Max Mehl’s Star Rare Coin Encyclopedia, were intended primarily as advertisements. The Wayte Raymond guide, however, gave collectors and dealers timely and impartial coin values including all US coinage. Every collector today owns at least one standard catalog, whether a world coin guide or the Red Book that gradually pushed the Wayte Raymond catalog off of bookshelves.
Penny board owners saved so many Lincoln cents that every Lincoln made in 1934 or later is common in circulated grades, with none over 40 cents in Good-4. The 1931-S has the second-lowest mintage of any Lincoln, but sells for less than the higher mintage 1909-S and 1914-D because more collectors were pursuing and saving cents in the mid-1930s when lightly worn 1931-S Lincolns could still be found in circulation. Even the 1909-S VDB, while costly today, is an easy-to-find coin. Nearly every coin shop in America has an example for sale, probably plucked from circulation by a collector looking to fill a board or folder.
Coin folders remain popular as an entry to the hobby. Most chain bookstores sell folders published by Whitman, Littleton, the US Mint, or other makers. For intermediate collectors, the coin folder has been replaced by the coin album, which places coins into holes in a single sheet of thick cardboard with clear plastic slides on each side. These combine the organization and storage of boards and folders with improved visibility and protection. Albums made by the Dansco company of Los Angeles have become the standard and COINage advertisers often sell complete sets of Peace dollars, Eisenhowers, and other coins in Dansco albums.
1964 – We are all roll searchers
Like in 1857, rising metal prices prompted this key date. In September 1963, silver rose for the first time to $1.29 per ounce, the value at which the bullion value of US 90% silver coins equals their face value. Speculators and the general public began to pull the valuable silver coins from circulation. Some people saw hoarding their pocket change as a minor savings or investment plan, but others gathered silver certificates and began exchanging them for the Treasury’s $1,000 bags of uncirculated generations-old silver dollars in what became known as the “silver rush.” A nationwide coin shortage resulted, with the problem exacerbated by a growing population and growing economy. The mint produced unprecedented numbers of coins, operating the Philadelphia and Denver mints 24/7 through much of 1964, but could not keep up with demand.
Congress held hearings on the shortage in 1964, gave permission to continue using the 1964 date past the end of the year, and passed the Coinage Act of 1965. The act removed silver from dimes and quarters dated 1965 and later, and reduced half dollars to 40% silver. Believing coin collectors caused the shortage, the government included provisions unfriendly to the hobby. Proof set production ended temporarily and mintmarks were removed so collectors would save only one roll or bag per year instead of one per mint. (Proof sets and mintmarks returned in 1968.)
Despite these measures, coins were again in the news and the public responded by pulling even more silver out of circulation. Like at end of the large cent, the final days of circulating silver caused people to search their pockets for disappearing coins. Some writers of the time believed clad coinage spelled the end of the hobby, but instead the interest in circulation finds lead to a growth in collecting. Some of the silver hoarders turned into numismatists and the coin hobby and coin market expanded. One of the signs of the increased interest in collecting was a new magazine named COINage that began publishing in 1964.
Unrelated to silver prices but occurring at the same time, the United States issued the Kennedy half dollar in 1964. The public saved these coins as mementos of the late president as much as for their silver content. These widely-saved coins were another stimulus to collecting.
One difference between pulling silver coins from circulation and saving obsolete denominations is that silver coins were identical to current issues except for the dates. This established the still common practice of roll searching. Online coin forums teem with descriptions of coin collectors and precious metal enthusiasts who buy boxes of coins from banks and search them for silver, valuable dates, varieties, or just nice examples for their albums. Just like during the silver rush, people today go through circulated coins looking for silver. As base metals become more valuable, some roll searchers also save bronze cents or ordinary nickels. Most, however, are still looking for the same 1960s and older dimes, quarters, and halves sought during the silver rush.
1999 – We are all collectors.
Like the Kennedy halves of 1964, the next key date involves new coins that caught the interest of the public. The United States had circulating commemoratives before. The Columbian, Stone Mountain, and Monroe Doctrine classic commemoratives were released to circulation in large numbers, the Bicentennial issues of 1976 circulated widely, and every coin showing a president or other historical figure can be seen as a commemoration of that person. The 50 State Quarters program of 1999 through 2008, however, involved circulating commemoratives on an unprecedented scale.
The cent is America’s most common coin, but the quarter, among coins that commonly circulate, is the greatest store of value, the most often spent, and the largest canvas for art. The state quarters program called for five states per year for ten years (later expanded a year to add the District of Columbia and territories) with designs chosen by the governors of each state. The design process, which became quite involved and political in some states, meant that every American not only knew of the program, but potentially could help select and shape their state’s coin. Some states, for example, allowed submissions from the general public or allowed open voting on designs, with 3.5 million people participating in the design process according to Mint estimates. The general press reported on the progress of each state’s quarter and covered the launch ceremonies.
This community involvement meant that people collected coins from circulation like never before. The US Mint stated that 147 million people, or about half of all Americans, collected state quarters in some way. The Mint responded by producing huge numbers of quarters - 4.4 billion just in 1999 and 35.4 billion over the eleven year program. The coin folder experienced renewed interest, with new designs intended for casual collectors. Some folders, for example, omitted mintmarks or were maps with spaces for coins at each state. Some makers even returned to the flat design of the 1930s coin boards, an option offering less protection but suited for framing.
1999 Delaware quarter
Image source: US Mint
Roll collecting also came back into the mainstream. From the end of World War 2 until 1964, collectors often saved and speculated in rolls of uncirculated coins, most famously the 1950-D nickel. State quarters brought back this practice. Rolls of the 1999 Delaware and other quarters traded for $80 to $100 at the peak of the market. The Mint, which once discouraged roll saving as removing coins needed for commerce, now sells bags and rolls of uncirculated coins. Some uncirculated pieces, such as recent Presidential and Native American dollars, are available, other than in mint sets, only in bags and rolls purchased from the government.
State quarters established circulating commemoratives as a permanent part of United States coinage. The 2004 – 2005 Westward Journey nickels, 2009 cents depicting the life of Lincoln, and the American the Beautiful quarters of the present day mean that every American is regularly exposed to new coin designs. State quarters, which combine treasure hunting, artistry, and a dose of national pride, are perfect for bringing new collectors into the hobby. These coins attract attention, leading people to set them aside and turning a few into collectors. Many people, for example, transitioned from pulling state quarters from circulation to seeking out certified silver proofs of the same coins. Circulating commemoratives often appear in advertisements in non-numismatic publications in which mail-order dealers offer attractive prices on state or America the Beautiful quarters to add potential new customers (and potential new collectors) to their mailing lists. The success of the US state program lead other countries to issue their own coins honoring the parts of their nations, such as the non-circulating 10-euro strikes for the 26 regions of France and circulating 500-yen pieces honoring Japan’s 47 prefectures.
What other years might be added to these key dates? The peaks of various market cycles, like today’s precious metals boom, come immediately to mind. But these cycles, such as the “coins as investments” frenzy of 1989, affected their times without leaving major and permanent marks on how we collect. Some additional key dates with lasting effects include:
1793 – Federal coinage begins. US coin collecting could begin only after US coins debuted.
1907 – The artistic revolution. Collectors today still focus on the golden age coins that began with Saint-Gaudens’ $10 and $20 gold pieces.
1987 – The slab. Third party grading has had an immense effect on the way we collect and especially how we buy, sell, and value.
A more important question to consider is the next key date. The events of each of the four years have a common element: collecting from circulation. In 1857 and 1964 coins were removed from circulation, in 1999 coins were added to circulation, and in 1934 we changed and expanded the way we collected from circulation. The next event will also involve coins we find in pocket change. It will be something of interest to the general public, not an innovation used only by more serious collectors such as slabs or registry sets.
One possibility is the end of the cent. People will save the obsolete denomination and the disappearance of the familiar penny will prompt some people to look into other coins of the past. The other likely contender is the replacement of the one dollar bill with widely-circulating one-, two-, or even five-dollar coins. Coins will be real money used for purchases, not just change to go in a jar, and they will attract new attention and new collectors. The numismatic press watches the political debates on the cent and one-dollar note closely. Collectors should follow these stories because, when a change happens, it could be our next key date in United States coin collecting.
“They were bent on profitable cruises, the profits to be counted down in dollars from the mint.”
Moby-Dick by Herman Melville is arguably the greatest work of literature ever produced in the United States. Readers will remember that a gold coin figures in the plot. Summarizing the coin’s role in the book, it first appears, referred to as a “Spanish ounce of gold” and a “sixteen-dollar piece,” when Captain Ahab nails the coin to the mainmast and offers it as a reward to the man who first spots the object of his hate, the white whale Moby Dick. Melville later devotes an entire chapter to the coin (Chapter 99, “The Doubloon”), in which eight characters examine and comment on or react to its symbols. No sailor ever earns the coin because Ahab is the first to see Moby Dick on each of the three days he appears.
Although the obverse remains facing the mast and is not visible, Melville describes the coin’s reverse in detail. With its smoking mountains, zodiac signs, and other peculiar images, the coin might seem to be a product of the author’s imagination. The careful description, however, shows us exactly to which gold piece the book refers. It is an Ecuador 8 escudos of 1838 – 1843.
Latin American coins such as this, commonly circulated in the United States at the time the novel was written in 1851. Eight Ecuador reals, like reals of Mexico or Spain, make one American dollar, and an escudo equals 16 reals. This gives the coin a US value of $16, as Melville describes. It is 21 karat or 0.875 pure gold and has an actual gold weight of 0.7614 ounce. The obverse shows a Liberty head, the motto “EL PODER EN LA CONSTITUTION” or roughly “Authority in the Constitution,” and a caption giving the purity, date, and denomination. The reverse, so well examined in the novel, shows three mountains topped by a tower, a fire, and a rooster, as well as a the sun passing through part of the Zodiac and stopping at Libra. “REPUBLICA DEL ECUADOR – QUITO M.V.” gives the issuing nation, the mint, and the initials of the assayer.
This was the first large gold coin of a young nation, a fact reflected in the less-skillful quality of the engraving. Mintage figures are unknown, and in 1844 this piece was replaced with an 8 escudos coin bearing the portrait of Simon Bolivar and the national coat of arms.
As collectors, we naturally are interested in how we can own a coin of this type. The lowest value in a Krause catalog, based on an outdated gold price of $600 - $700 per ounce, is $650 for the most common date of 1841 in Very Good, or about 30% over the melt value of around $500. Examples in any grade, however, come up for sale only rarely. Searching Heritage Auctions results, for example, finds only one sale of these coins in the last few years. In January 2010, nine pieces, representing all varieties, sold for values ranging from $6,900 for an 1841 uncertified XF to $25,300 for an 1839 NGC AU58. The combination of its numismatic and literary value makes this an extraordinary coin.
Most nations use a decimal system of currency where one major unit, such as the dollar, peso, or franc, is divided into 100 minor units, such as cents, centavos, or centimes. In the coin shop or in literature, we may encounter the less-obvious British sterling system with its confusing farthings, florins, guineas and other denominations. Because the British Empire spread its system around the world, understanding this coinage scheme is useful for world coin collectors.
The sterling system is also known as “pounds – shillings – pence” after its key parts. The pound served as the major unit. Each pound was divided into 20 shillings, which was further divided into 12 pence (The singular of “pence” is “penny”). Each, pound, therefore, contained 12 X 20 = 240 pence. Amounts were written and calculated using all three units, such as “one pound, seventeen shillings, and nine pence.” Before 1971, the abbreviation for pence was “d,” so you may see a sixpence, for example, cataloged as a “6d.”
Several coins made up the sterling system. Although sizes, meanings, names, and metals changed with time, and this is not an exhaustive list, these are the 19th and 20th century issues collectors will most often encounter.
Farthing (Great Britain)
Penny (Great Britain)
Threepence (New Zealand)
Sixpence (Great Britain)
Shilling (Great Britain)
Florin (Great Britain)
We all enjoy looking at our coins, but few storage methods lend themselves to display. Prestige sets, however, invite exhibition on your bookshelf. Standing upright with the front cover of the book-like case open, they show their contents to good effect while remaining safe in the Mint’s lenses. Assuming they stay away from heater vents, sunbeams, and other sources of environmental damage, your sets will be protected and put on view at the same time.
Modern Commemoratives Likely to Appreciate
Many collectors see classic (1892 - 1954) commemoratives as a single series to be collected in its entirety. The classic series has its low-mintage issues like the 1928 Hawaiian half that command prices similar to key dates in popular circulation series. In modern commemoratives expect to pay high and increasing prices for coins, such as the uncirculated 1996 Atlanta Olympics rowing dollar, that were unpopular at the time of issue. Seen as a series, prestige sets also have t heir low-mintage years that could become valuable. High issue prices for all of the prestige sets kept production low in most years, creating several opportunities. The market recognizes the rarity of the 55,000 mintage 1996 set at $320 for example, but not the 80,000 unit 1997 set which remains affordable at $93.50.
Appreciation through Attrition
Like other silver proof sets, many prestige sets fall victim to high silver prices. I recently bought a 1986 set (the most common) for $32.50 from a dealer who was asking $36 for circulated silver dollars. He could have cracked out the 90% silver dollar, put it in a junk bag, discarded the other coins and packaging, and realized a higher price. Similarly, a collector at a recent club meeting offered several dollarless prestige sets for sale. This attrition can lower supply an d, in time, increase price.
Bargains Are Available
If I were a dealer hauling my inventory to a show, stocking a small shop, or mailing coins to customers with a fixed shipping charge, I would prefer to carry my product in a small 2” by 2” holder rather than an item of the same value in a weighty 7” by 5” box. Dealers are happy to
Precious Metal Value
Each prestige set includes a dollar with 0.77 ounce actual silver weight, giving in intrinsic value even if the numismatic premium declines.
Consider starting your prestige set collection with one of the common $35 - $45 sets with a commemorative theme that appeals to you. Show the set in your home for a few weeks and see how you feel about the display. You may find a rewarding new collecting interest.