A Weekly Column by Greg Reynolds
Coin Rarities & Related Topics: News and Analysis regarding scarce coins, coin markets, and the coin collecting community, column #183..........
The Rarities Night event of Aug. 15th was one of many sessions in the official ANA convention coin and paper money auction by Stack’s-Bowers, which totaled more than $46 million. Before the auction, I covered some of the copper and silver coins that were offered, and, after the auction, I reviewed major gold coin rarities in this Rarities Night event. Here, I focus on the famous 1878-S Liberty Seated Half Dollar that was featured.
This 1878-S is PCGS graded MS-63 (on a scale from 01 to 70) and has a sticker of approval from the CAC. It is almost certainly one of the ten finest known of fewer than fifty 1878-S halves that survive. It sold for $164,500 in Aug. 15th, a moderate price.
This 1878-S is a pleasant coin. It scores highly in the technical category. There are hardly any contact marks or hairlines on the reverse (back of the coin). There are a few hairlines on the obverse (front), though these are minor. Indeed, though its technical characteristics are that of a MS-64 grade coin, this 1878-S does not quite have enough eye appeal to grade MS-64. Even so, its grade is certainly above the midpoint of the MS-63 range and it is attractive overall.
The toning on this 1878-S half dollar is natural, mostly medium shades of brown-russet. There are also some gray tones. Miss Liberty on the obverse and the eagle on the reverse are lighter than the fields and stand out nicely.
This 1878-S is one of the better representatives of the key date in the series of Liberty Seated Half Dollars, and is one of the most famous of all half dollar issues. (Clickable links are in blue.) Liberty Seated Half Dollars were minted from 1839 to 1891.
The 1878-S half was in Richard Jewell’s comprehensive collection of Liberty Seated Half Dollars, which was offered in the Rarities Night event. Collecting Liberty Seated Half Dollars ‘by date’ is not easy, and Jewell deserves much credit for assembling an excellent set. Two years ago, this same 1878-S was part of Dick Osburn’s set of Liberty Seated Half Dollars, which was also auctioned during a Stack’s-Bowers Rarities Night event at an ANA Convention in Rosemont, Illinois.
In 2011, it brought $184,000, 11.8% more than this same coin realized in 2013. Put differently, it brought 10.6% less in 2013. There are many variables that could affect the auction price for any one coin. Therefore, it does not make sense to draw a conclusion, based on the fact that this one coin realized less in 2013 than it did in 2011.
Even so, it does make sense, for educational purposes, to discuss plausible reasons for a lower price in 2011.
- First, there are not a large number of collectors who assemble sets of Liberty Seated Half Dollars in uncirculated (‘Mint State’) grades (60 to 69). There were more collectors doing so during the period from 2006 to 2008 than there are now. There may have been more in 2011 than there are in 2013, or most of those doing so now may not have been able to afford this specific coin at this time. Alternately, they could have also been focused on other coins in Jewell’s set.
- Secondly, this coin is not currently ‘fresh.’ To be fresh, a coin must not have been openly offered, in the mainstream of the coin business, for more than five years. Usually, though not always, a fresh coin will fare better at auction, if all other factors are, more or less, equal. (Please see my article on ‘What Are Auction Prices?’).
- Third, since coin markets recovered from ‘bottom’ levels in 2009, there has been more interest overall in rare U.S. gold coins than in rare U.S. silver coins. Of course, there are exceptions to this rule. A 1794 silver dollar was auctioned for more than $10 million in January and an 1894-S dime recently sold privately for more than $2 million. These, though, are extraordinary coins. I am not implying that rare gold coins are more desirable than rare silver coins. I am pointing out that, over the last four years, the intensity of demand for rare gold coins has been greater. This was not true during the period from 2004 to early 2008.
- Fourth, values for high grade 1878-S half dollars did rise considerably from 2005 to early 2008. In Jan. 2005, ANR auctioned a PCGS graded MS-63 1878-S for $82,800. In July 2004, Spectrum-B&M auctioned one for $80,500. In March 2005, the Richmond Collection 1878-S, which was NGC graded MS-63, was sold by DLRC for $87,400. These would have been worth from $125,000 to $185,000 in the middle of 2008.
Prices for circulated 1878-S halves dramatically increased as well. In Feb. 2012, Heritage auctioned a PCGS graded Extremely Fine-40 1878-S for $86,250, which is around the value of a PCGS graded MS-63 1878-S in 2004. In Aug. 2004, Heritage auctioned an NGC graded EF-40 1878-S for $34,500. It does not make sense, though, to draw firm conclusions regarding market values without examining the coins in question. The certified EF-40 1878-S that Heritage sold in Feb. 2012 may have characteristics that are much different from those of the certified EF-40 1878-S that Heritage sold in Aug. 2004.
Surface quality, originality, and eye appeal are all factors that affect the value of a coin. Pedigrees, freshness, and the timing of offerings are factors as well.
The Pryor-Thomas, PCGS graded “MS-64” 1878-S sold for $184,000 in April 2009, when markets for rare U.S. coins ‘hit bottom’ after peaking in Aug. 2008. Spectrum-B&M auctioned this same coin in Aug. 2004 for $92,000, precisely half as much.
While I have never seen this specific coin in a holder indicating a PCGS “MS-64” grade, it is certainly plausible that it would would have sold for more than $235,000 if Heritage had auctioned it on July 31, 2008, rather than in April 2009. Additionally, there is a good chance that it is worth $235,000 or more in the present. I would really have to examine the coin, however, in order to evaluate it.
It is relevant that the Osburn-Jewell, PCGS graded MS-63 1878-S has a sticker of approval from the CAC, and the Pryor-Thomas, PCGS graded “MS-64” 1878-S does not have such a sticker. The CAC has approved just two 1878-S halves, the Osburn-Jewell coin that Stack’s-Bowers auctioned on Aug. 15 and an 1878-S that is PCGS or NGC graded VG-10.
This exact same Osburn-Jewell 1878-S half has been in some excellent collections. Dick Osburn and Richard Jewell successfully collected Liberty Seated Half Dollars ‘by date’ (and U.S. Mint location). Reed Hawn and Douglas Noblet formed epic collections of half dollars.
Stack’s (New York) auctioned Reed Hawn’s set of half dollars, including this same coin, in 1973. B&M (New Hampshire) auctioned Douglas Noblet’s collection of half dollars in Jan. 1999. So, this half is the Hawn-Noblet-Osburn-Jewell 1878-S.
The PCGS CoinFacts site reports that this coin sold for “$63,000” in 1999. The “$63,000” amount, however, does not seem accurate. If the buyer’s commission was 15%, a $63,000 total would require a somewhat awkward hammer price of $54,782.61. Although my guess is that the buyer’s commission for B&M in 1999 was 15%, suppose that it was 10%. A $63,000 total would then stem from a hammer price of $57,272.73, which would also be an odd number to be ‘called out’ by an auctioneer or a bidder.
In any event, Noblet’s collection is legendary. Dick Osburn’s set was incredible. Although I did view a large portion of the pieces, I have not yet analyzed the depth and quality of Jewell’s set. Collecting Liberty Seated Half Dollars ‘by date’ and building a set with many choice or gem quality coins is very challenging, though such coins are good values in the current market environment.
The rarest Liberty Seated Dimes and Liberty Seated Quarters are all Carson City, Nevada Mint issues. Corresponding CC Mint Liberty Seated Half Dollars are not nearly as rare. There is just one 1873-CC ‘No Arrows’ dime and perhaps five 1873-CC ‘No Arrows’ Liberty Seated Quarters, yet there are more than 250 1873-CC ‘No Arrows’ Liberty Seated Half Dollars.
There are no 1878-S dimes and 1878-S quarters are very rare, though not nearly as rare as 1878-S halves. Although 1878-S Morgan Silver Dollars are not as common as 1881-S or 1882-S Morgans, these are plentiful; hundreds of thousands of 1878-S Morgans survive. It seems that, in 1878, the San Francisco Mint devoted a large percentage of available resources to minting silver dollars, for political reasons.
It is curious that the rarest Liberty Seated Half Dollar is the 1878-S. How rare is it?
The data published by the PCGS and the NGC includes multiple counts of some of the same coins. PCGS data indicates that eleven 1878-S halves are PCGS graded above MS-62 and the NGC census reports five as being NGC graded above MS-62. The total of sixteen may amount to only eight different coins, if that many. John Albanese suggests that there are “less than ten true mint state ’78-S halves in existence.”
Overall, 1878-S half dollars are rarer than most collectors realize. Randy Wiley and Bill Bugert are sometimes cited by auction cataloguers as estimating that forty-eight exist. When I referred to their book that was published in 1993, I found that they said otherwise. Wiley and Bugert “project a total population of at least forty-eight pieces” and “most likely at least sixty pieces”!
Their total includes some that are ‘not gradable’ by the standards of the PCGS and the NGC. Even so, there are reasons to challenge the Wiley-Bugert estimate of “at least sixty.” The PCGS has graded twenty-six and the NGC, thirteen. This total of thirty-nine probably amounts to, at most, twenty-eight different coins.
Both services are somewhat generous in terms of assigning numerical grades to famous rarities. A coin that would not be judged as being gradable if it was a non-rare date may receive a numerical grade if it is a key date or a famous rarity. The1878-S half is the key date of a whole series that lasted more than a half-century and it is extremely rare.
If a Liberty Seated Half Dollar has really severe problems, however, it is unlikely that it would receive a numerical grade from the PCGS or the NGC. Liberty Seated Half Dollars from the 1870s, however, do not usually have terrible problems. Most of those that did were melted long ago, probably by non-collectors. Perhaps twelve, at most, are certainly non-gradable. Additionally, I figure that there are three to five that are clearly gradable, yet have never been submitted to the PCGS or the NGC.
Therefore, I suggest that there are, at most, forty-five 1878-S halves. The Wiley-Bugert claim that “many coins go directly into collections without formal advertisement” would have been more convincing in 1993 than in 2013, though I would have had doubts about it in 1993 as well. Yes, there have been quiet, private sales during the last thirty years. In the vast majority of instances that 1878-S halves are offered, they will be consigned to auction, especially since market prices for these have risen so much over the last ten years.
In fairness to Wiley and Bugert, it should be repeated that their book was published in 1993. Much additional information has become available over the last twenty years. Certainly, I would not wish for Wiley or Bugert to focus on all the remarks about coins that I put forth in 1993. I have learned much in the interim and it may be true that they have as well.
Coin markets have changed and the Internet has become a dominant factor. Moreover, there are now fewer dealers who are willing and able to inventory 1878-S halves. When a collector wishes to sell an 1878-S half, he or she is likely to be at least curious as to results of a public offering.
In 2011, Stack’s-Bowers auctioned a PCGS graded Fine-15 1878-S for $51,750. Also in 2011, Heritage auctioned a PCGS graded AG-03 1878-S for $28,750. Did Wiley or Bugert imagine in 1993 that heavily circulated 1878-S halves would sell for so much in 2011?
Auction appearances of 1878-S dollars are not frequent. Furthermore, some of the same ones have appeared multiple times over the past thirty years. Is there really solid evidence of more than forty existing?
Since 1999, the Goldbergs auctioned just one 1878-S half, a PCGS graded Very Fine-30 coin. The Heritage Auction Archives indicate that, since 1993, Heritage has auctioned just eleven, not all of which are different coins.
In the PCGS registry set category of “Liberty Seated Half Dollars Basic Set,” business strikes from 1839 to 1891, the second “All-Time Finest” set, that of “WBDVII,” never had an 1878-S! This set did, however, include representatives of all of the Carson City Mint issues of half dollars.
The “current finest” in this same set category, the “Southcounty Collection,” is also the second “All-Time Finest”! It is reported to be “97.35%” complete, according to the rules of the PCGS registry. The “Southcounty Collection” is also missing an 1878-S!
Of the five “All-Time Finest” sets of Liberty Seated Half Dollars in the PCGS set registry, only the first, Eliasberg, and the fourth, “Gettysburg,” list an 1878-S. Neither Eliasberg nor his sons participated in the PCGS set registry. Eliasberg listings were added by experts at the PCGS, presumably for educational purposes.
So, if the Eliasberg listing is excluded, only one of the five “All-Time Finest” sets in the Liberty Seated Half Dollars ‘by date’ (and Mint location) category contains an 1878-S. Given the many other rarities that are included in these top five sets, often in relatively high grades, it is clear that the collectors who built these sets could have afforded to obtain a gradable 1878-S. The absence of an 1878-S in many of these registry sets is circumstantial evidence that the 1878-S is rarer than most relevant experts believe. It seems that those building registry sets have had difficulty finding 1878-S halves.
In another category, that of “Liberty Seated Half Dollars with Major Varieties,” there is an additional, highly ranked set, “RossWB,” which has a PCGS graded EF-40 1878-S. All the other sets in this “with Major Varieties” category, however, lack an 1878-S. If a collector could afford all the dates (and Mint combinations) plus the ‘major varieties,’ such a collector could, in almost all cases, afford an 1878-S.
In the NGC registry, there are sixty-five sets in the category of Liberty Seated Half Dollars ‘by date’ (and Mint location). As best as I can tell, only the top three sets include 1878-S halves. Two of these three list the same 1878-S, the specific topic coin here, which was in the now dispersed Osburn and Jewell Collections.
The third 1878-S in the NGC registry, that in the set of “YeOldOne,” was already mentioned. It is the PCGS grades “MS-64” 1878-S that was formerly in the James Pryor and “Joseph Thomas” collections. B&M (New Hampshire) auctioned it in Jan. 1996 for $70,400 and Heritage auctioned in April 2009 for $184,000.
So, among sixty-five entries for sets of Liberty Seated Half Dollars in the NGC registry, only three list 1878-S halves, two of which are the exact same coin, the main topic of the present discussion. In the PCGS registry category of Liberty Seated Half Dollars “with Major Varieties” category, only one entrant has an 1878-S. The participating collectors probably figured that there are more available than really exist and later found 1878-S halves to be more elusive than they thought 1878-S halves would be.
Of course, there are many collectors of Liberty Seated coins who do not compete in the PCGS or NGC registries. An overriding point here is that many of the collectors who do participate need an 1878-S half for their respective sets and can afford to buy one. The fact that most such registry set collectors do not have an 1878-S is additional evidence that 1878-S halves are rarer than the Wiley & Bugert book or the PCGS CoinFacts site indicate. I hypothesize that fewer than forty-five exist, maybe seven of which truly grade above MS-62.
©2013 Greg Reynolds