Coin Rarities & Related Topics: News and Analysis regarding scarce coins, coin markets, and the coin collecting community #212
A Weekly CoinWeek Column by Greg Reynolds ……..
Gold coins were produced at the Branch U.S. Mint in Dahlonega, Georgia, from 1838 to 1861. One Dollar Gold pieces, Quarter Eagles ($2½ gold coins), Three Dollar Gold pieces and Half Eagles ($5 coins) were minted there. The focus here is on the 1861 Dahlonega Mint Half Eagle.
It was formally reported that, after Jan. 20 and before April 8, 1861, 1597 Half Eagles ($5 gold coins) were struck at the Dahlonega Mint. Later, at least another 1000 1861-D Half Eagles were struck, while the Dahlonega Mint was under the rule of Confederate forces. There is no way of definitively separating all the 1861-D Half Eagles there were minted before Confederate forces took full control from those that were struck afterwards. The U.S. Civil War started during April 1861 and ended during May 1865.
As the general belief is that all 1861 Dahlonega Half Eagles were struck from one pair of dies, coins from later die states are more likely to have been struck under Confederate rule. Regardless of the precise times that specific coins were struck, all genuine 1861-D Half Eagles are very rare and have special historical significance.
An 1861-D Half Eagle is ‘in the news.’ On Feb. 27, at the Winter ANA Convention in Atlanta, Heritage auctioned a PCGS graded “AU-50” 1861-D, which will be discussed herein.
Because 1861-D coins are the last issues of the Dahlonega Mint and because of the historical circumstances in 1861, these are among the most famous of all U.S. coins. No Quarter Eagles were struck at the Dahlonega Mint after 1859. Only One Dollar pieces and Half Eagles were struck there in 1861. According to Doug Winter, the “entire mintage” of 1861-D One Dollar Gold pieces “was produced by the Confederate States of America” in May 1861. The combined total of all 1861-D Gold Dollars and 1861-D half Eagles is extremely likely to be less than 250!
Unfortunately, surviving 1861-D coins tend to have problems, which are often serious, and few 1861-D coins score highly in the category of originality. Indeed, in most cases, 1861-D coins have been cleaned and/or dipped to the point that their respective current color is dramatically different from their original color. Even so, many collectors love them.
In relation to the history of U.S. coinage, the history of the South, and the culture of the region, Dahlonega Mint gold coins have considerable meaning. (Please click to read a coin-oriented discussion of the ‘Southern Gold Rush’ that was published last year.) Because of the fame of the California Gold Rush, the earlier and also important Southern Gold Rush is often overlooked, even by historians who focus upon the pre-war (antebellum) South.
Even aside from the history of the South, the role of the Dahlonega Mint in the history of U.S. coinage is particularly curious. This mint was such a relatively small operation, which was limited to gold coinage, in a sparsely populated area.
From 1793 to 1837, all U.S. coins were struck at the Philadelphia Mint. In 1838, Branch U.S. Mints began operating in Charlotte, Dahlonega and New Orleans.
Not long after the U.S. Civil War began in 1861, the Charlotte and Dahlonega Mints were closed by the Confederate regime. They never re-opened. The New Orleans Mint was closed, too, though it did later re-open and was still in operation in 1909. Coins struck in New Orleans each have an ‘O’ mintmark.
In the 19th century, Philadelphia Mint coins did not have mintmarks. While some researchers argue that there are exceptions to this rule, my current belief is that there are no exceptions. If there are any exceptions, the most likely candidates would be some Special Strikings of 1876-CC dimes.
All 19th century U.S. coins with a ‘D’ mintmark were struck at the Branch Mint in Dahlonega, Georgia. A ‘C’ mintmark on a U.S. coin indicates that it was struck in Charlotte, North Carolina. As all coins with such a ‘C’ mintmark were minted from 1838 to 1861, it is unlikely that they would be confused with coins that each have a ‘CC’ mintmark, which were struck at the Carson City, Nevada Mint from 1870 to 1893.
Silver coins and gold coins were struck in Carson City and in New Orleans. Copper, ‘nickel,’ silver and gold coins were struck in the San Francisco and Denver Mints. (In regards to U.S. coinage, a ‘nickel’ is typically specified to be 25% nickel and a copper coin is at least 90% copper.) Before the 20th century, however, all U.S. copper or nickel coins were struck in Philadelphia.
The fact that the Charlotte and Dahlonega Mints just produced gold coins is historically significant and otherwise interesting. When I was collecting coins as a kid, I thought of Charlotte and Dahlonega Mint coins as being mysterious and exotic, even before I ever saw one.
The physical rarity of 1861-D coins is of central importance. Most Dahlonega Mint coins are very rare. A coin is very rare if fewer than 250 survive, of all varieties.
The 1861 Dahlonega Half Eagle is probably the rarest Dahlonega Mint Half Eagle. The PCGS CoinFacts site suggests that just seventy-five survive. In a reference book that was published in 2003, Doug Winter estimated that sixty-five to seventy-five survive.
There are likely to be a few more than one hundred survivors. Since 1993, Heritage has offered thirty-seven at auction. The PCGS has graded seventy. The NGC has graded thirty-three. I hypothesize that the PCGS and the NGC together have graded at least sixty different 1861-D Half Eagles. I figure that at least twenty-three others have been submitted and not awarded numerical grades, some (not all) of which are now in ‘Genuine’ or ‘details’ holders
There are at least another twenty 1861 Dahlonega Half Eagles that have never been submitted to the PCGS or the NGC. Some are so obviously non-gradable that their respective owners did not even consider submitting them to the PCGS or the NGC.
“Yes, there are numerous examples that have been cleaned, some harshly, that will not grade,” responds Al Adams to an inquiry in connection with this discussion. Adams has been a specialist in Southern gold coins for decades and has an office in the Dahlonega area.
In the 1980s and 1990s, the PCGS did not put coins in ‘GENUINE’ holders and the NGC did not place coins in ‘details’ holders; genuine coins that were denied numerical grades were then returned without being certified, though grading fees had to be paid.
There are also Dahlonega Mint coins in holders issued by grading services other than the PCGS or the NGC, sometimes because other services will assign numerical grades to coins that graders at the PCGS or the NGC would not assign. I hypothesize, though, that problematic Dahlonega Mint gold coins tend to not be encapsulated as dealers often find a rare and historically significant non-certified coin to be easier to sell than a coin in a holder that suggests serious problems.
In many cases, the seller of a problematic, non-certified coin does not mention its problems to prospective buyers, or understates such problems. For example, a mis-guided or unethical dealer may refer to a damaged coin as “EF-45 with a few light marks.” Besides, when 1861-D Half Eagles are being offered by dealers, rarity and historical significance are usually emphasized, not quality.
There are dealers who sell non-certified, rare U.S. gold coins. Coincidentally, I just happen to have ready access to a PDF file of the April 2013 catalogue of a large coin firm in California, a dealer that advertises in most major coin publications.
While there was not an 1861-D in this particular retail catalogue, a “CH VF” 1845-D Half Eagle was offered for $2100. This, too, is a rare Dahlonega Mint gold coin, though not nearly as rare as an 1861-D. A non-certified “AU” 1860 Charlotte Mint Half Eagle was also offered in the same catalogue. This is not the only firm that sells non-certified, rare 19th century gold coins.
My guess is that non-gradable Charlotte or Dahlonega Mint coins are frequently offered at coin shows of various sizes, around the nation. If a collector seeks classic U.S. coins that cost more than $500 each, he or she should only consider coins that are PCGS or NGC certified (unless a better grading service is founded in the future).
It is also true that the gold coins of the Charlotte and Dahlonega Mints have been a popular collecting specialty for more than fifty years. A few, very much gradable coins have yet to be certified. There are ‘old-time’ collections containing some Southern gold coins that people have inherited and/or were assembled before 1990. “I believe most survivors have been submitted for grading by now, but I know of several nice [1861-D Half Eagles] that have never been submitted,” Al Adams declares.
In sum, if at least sixty different 1861 Dahlonega Half Eagles have been graded by the PCGS or the NGC, at least twenty-three have failed to receive numerical grades from the PCGS or the NGC, and at least twenty have never been submitted to the PCGS or the NGC, then at least 103 exist, maybe even 115. Admittedly, though, I am puzzled that I have been able to find very few records of non-gradable or sub-45 grade 1861-D Half Eagles existing. I emphasize that my estimates regarding rarity are tentative and more research should be done regarding Dahlonega Mint issues. It would make sense for researchers to carefully itemize some of the lower grade coins, not just those that are high in condition rankings.
III. Result Last Week
Is the $38,187.50 auction result, on Feb. 27, for a PCGS graded “AU-50” 1861-D Half Eagle a strong price? The PCGS price guide retail value is or was “$34,000.” The Numismedia.com retail value is $28,130.
It is also true that a PCGS graded ‘EF-40’ 1861-D was auctioned by Heritage for $41,125 on Sept. 7, 2012. On March 26, 2010, Heritage auctioned an 1861-D that experts at the NGC found to be non-gradable and to have the “details” of an AU grade coin. It sold for $32,200. Other auction results tend to be on a lower scale than these two just mentioned prices. Even so, leading price guides probably understate prevailing market levels for 1861-D Half Eagles.
This $38,187.50 result seems to be moderate to slightly strong. The PCGS graded EF-40 coin that sold for more in Sept. 2012 was fresh, while the coin that sold last week had been publicly offered in January. Further, the coin that sold in Sept. 2012 may possibly score higher in the category of originality and/or may have fewer contact marks. There are several variables that affect the value and overall desirability of a rare coin. In any event, I would form a more solid conclusion about the auction of an 1861-D last week if I had actually seen the coin that was auctioned.
Al Adams “did examine” this coin. “Like nearly all surviving 1861-D [Half Eagles], it is short on eye appeal and originality. I believe it is the same coin as lot#5456 from the Heritage FUN 2014 auction, that did not sell. I grade the coin as” Extremely Fine “45,” Al states. “The grading services,” Adams finds, “are fairly strict and accurate on most 1861-D fives, but I believe liberal on this particular coin.” Over the course of his career, Al has probably viewed a large percentage of the 1861-D Half Eagles in existence.
IV. The Finest
Although the PCGS lists four as being graded “MS-63,” I am not convinced that these are four different coins. The NGC lists an 1861-D Half Eagle as grading “MS-64,” which is one of the coins that the PCGS graded as “MS-63.” That NGC graded 64 and PCGS graded 63 “Duke’s Creek” coin was available as part of a set of Dahlonega Mint Half Eagles at the August 2012 ANA Convention in Philadelphia. While I did not have a chance to very closely examine this coin, my tendency is to maintain that the second Duke’s Creek 1861-D is superior, mostly because it scores higher in the category of originality. This second Duke’s Creek piece is PCGS graded MS-63. It is true, though, that the NGC graded MS-64 coin is more sharply struck.
This second Duke’s Creek coin was formerly owned by at least one of the Kagins, a family that has been very much involved in the coin business since the 1930s. I remember being very impressed by this Kagin-Creek, PCGS graded MS-63 1861-D when I examined it in Jan. 2008. For a Dahlonega Mint coin, it scores very high in the category originality. It scores well in the technical category as well. This is the finest 1861-D Half Eagle that I have ever seen, and I have seen most of those that have been certified as grading from “62” to “64.” There are none that are PCGS or NGC graded above 64.
The third finest known is probably the Farouk-Norweb-Bass-Pond 1861-D. Though it has been at least moderately dipped, lightly to moderately cleaned, and has some very noticeable abrasions, it is sharply struck and is somewhat attractive overall. At some point between 2004 and 2007, it was upgraded by the PCGS from “MS-62” to “MS-63,” which is unsurprising. Its grade is around the border of the 62 and 63 grade ranges.
Both the Kagin-Creek coin and the Farouk-Norweb-Bass-Pond coin were offered in the Jan, 10, 2008 Platinum Night event in Orlando, which I attended. The Kagin-Creek coin brought $207,000, which is still an auction record for the date. If I am correctly deciphering my handwriting, a bid of $155,250 ($135k+15%) was not sufficient to buy the Farouk-Norweb-Bass piece. It did not sell. My impression is that a bid of at least $161,000 would then have been required to buy it.
This same Farouk-Norweb-Bass 1861-D appeared again in the Stack’s sale of March 2010 The current Stack’s-Bowers website lists a price realized of “$184,000” on March 2, 2010. I believe that this listing is an error and that this coin did not sell in March 2010.
This same Farouk-Norweb-Bass 1861-D did sell in the Stack’s-Bowers Rarities Night event of Aug. 18, 2011. No pedigree information was provided in the catalogue in 2011. It brought $143,750, a fair price that is consistent with the prevailing notion that it is the third finest known.
On Jan. 9, 2014, a NGC graded “MS-62” 1861-D brought $99,875. In response to a recent e-mail of mine, Al Adams now reveals that “I purchased the NGC MS-62 1861-D, Heritage FUN 2014 auction lot #5457, a very pretty coin.” Adams estimates that “there are approximately twelve or more ‘mint state’ coins known and twenty or so AU” grade 1861-D Half Eagles.
In March 2013, Stack’s-Bowers auctioned a non-gradable 1861-D that experts at the NGC declared to have the ‘details’ of an uncirculated (‘mint state’) coin. While this 1861-D is not great, it is not bad for a non-gradable coin. I have seen many Southern gold coins that have far more serious problems. The price realized of $25,850 was hard to interpret, though could have been a good deal.
An 1861-D that truly grades AU-55 or higher would be likely to cost more than $40,000, probably more than $50,000. On Aug. 12, 2011, Heritage auctioned an NGC graded “AU-55” 1861-D for $48,875.
As far as I know, it has been a long time since a sub-40 grade 1861-D Half Eagle has sold at auction and only two or three non-gradable pieces have been offered in major auctions over the past five years. Where are the vast majority of sub-40 grade and non-gradable 1861-D Half Eagles?
©2014 Greg Reynolds