Coin Rarities & Related Topics: News and Analysis regarding scarce coins, coin markets, and the coin collecting community, #198

A Weekly CoinWeek Column by Greg Reynolds …………

Business strike early U.S. silver dollars date from 1794 to 1803. Silver dollars dated 1804 are special strikings that could not have been made before 1834. There are three design types of such early silver dollars: 1) Flowing Hair 1794-95; 2) Draped Bust, Small Eagle 1795-98; 3) Draped Bust, Heraldic Eagle 1798-1903. Overall, the focus here is on silver dollars dated 1797, including coins meriting high grades, medium grades, low grades, and no grades.

As the astonishing Newman Collection 1797 dollars were recently ‘in the news’ and generated much excitement, I discuss them along with the subtypes of 1797 dollars in general. Many collectors find well circulated 1797 dollars to be better values than AU or ‘mint state’ 1797 dollars. Indeed, in Fine to Very Fine grades, 1797 dollars are not extremely expensive. They are available in many coin auctions and from dealers.

I. Subtypes of 1797 Dollars

All known 1797 dollars were struck from just three pairs of dies and all such die varieties are notably different. A set of all three is not too hard to assemble.

1797 dollars thumb U.S. Silver Dollars of 1797It is especially interesting that each of just three issues of 1797 dollars is of a readily apparent variation in the design. The differences are not subtle. It could be fairly argued that each of these three is a major design subtype, though I maintain that just two are subtypes and the third is a minor variety of the second.

Dollars of this year either have ten stars on the left on the obverse (front of the coin) and six stars on the right (10 by 6), or nine stars on the left and seven on the right (9 by 7). It is easy to tell these apart. A collector need not engage in research to determine which 1797 dollars are ‘Ten by Six’ and which are ‘Nine by Seven.’ A 1797 dollar has ten stars to the left of the letters of ‘LIBERTY’ or it has nine to the left.

Among those that have nine stars on the left and six on the right, there are differences in the size of the letters. There are 1797 dollars that were struck with letters in ‘UNITED STATES OF AMERICA’ on the reverse (back) that are larger than such letters are on other 1797 dollars. There are thus two reverse varieties of 1797 dollars that have ‘Nine by Seven’ stars on the obverse (front), ‘Large Letters’ and ‘Small Letters.’ For collectors of die varieties, this is a very important point, as such collectors seek representatives of all three pairs of dies that were employed to produce 1797 dollars.

My view is that the difference in obverse stars, which is readily apparent and can be identified without an explanation, defines two subtypes, while the difference in the size of the reverse letters results in two minor varieties of the ‘Nine by Seven’ subtype. Many established guides, however, list all three as subtypes or as “major varieties” that are collected ‘as if’ each is a distinct date.

The 1797 Nine by Seven-Small Letters is, by far, the rarest of the three die pairings and one of the rarest issues of early dollars that is sometimes collected as a subtype or ‘as if’ it is a distinct date. All 1797 ‘Ten by Six’ dollars have ‘Large Letters’ on the reverse (back).

Although there are a small number of extremely dedicated collectors of pre-1840 U.S. coins of all series who collect by die variety, which usually refers to a die pairing, or by so called “major varieties,” the vast majority of collectors of U.S. coins ignore such varieties.

“I personally do not collect such things as letter or die varieties. I do collect overdates and over-mintmarks,” Bruce Morelan reveals. He is one of the most famous and accomplished, living collectors. He has owned the Eliasberg 1884 and 1885 Trade Dollars, the finest known 1870-S Liberty Seated Silver Dollar, two different 1913 Liberty Nickels and an assortment of other rarities. Plus, he has completed several, landmark registry sets.

Dr. Steven Duckor has also completed many sets, including landmark registry sets. Duckor is one of the most sophisticated and influential collectors of all time. He, too, has not collected coins ‘by die variety.’ Further, Dr. Duckor has never focused on ‘letter’ or positional varieties. Dr. Duckor has collected overdates and variations in mintmarks, like the 1892 ‘Micro O’ Barber Half Dollar.

It is not my intention to discourage anyone from collecting by die variety. I know and very much respect many coin enthusiasts who do collect in this manner. For some collectors, this is the best method. An immediate point is that the vast majority of collectors ignore die varieties (and ignore most so called “major varieties”). References to die varieties or subtypes, which may seem complicated, should not discourage beginners from getting started and should not discourage anyone from collecting  ‘by date’ or ‘by design type.

Collecting Draped Bust Silver Dollars ‘by date’ may be very enjoyable and circulated business strikes are not extremely expensive. Those who are interested in early U.S. coins and cannot afford bust dollars may wish to focus on Draped Bust Half Dollars or on those Capped Bust Half Dollars that are not very costly. Even those who cannot afford bust silver dollars, however, may benefit by learning about them.

When collecting U.S. coins, it helps to have an understanding of various denominations and time periods. In order for a collector to understand the classic U.S. coins that he (or she) can afford, there is a need to learn about the classic U.S. coins that he (or she) cannot afford.

II. Values of Circulated Coins

Except the just mentioned 1797 ‘Small Letters,’ the 1798 with fifteen stars on the reverse, and particularly rare die varieties, ballpark retail values for  PCGS or NGC certified Draped Bust, Small Eagle Silver Dollars are: Good-04 $1500, Good-06 $1800; Fine-12 $3500; Fine-15 $3900; Very Fine-20 $5300, VF-30 $6250, Extremely Fine-40 $8750.

1797 gr d U.S. Silver Dollars of 1797These retail values are very rough approximations and should not be relied upon by buyers. Coins that score particularly high in the category of originality will often sell for more. Certainly, coins that are less affected than usual by scratches and other contact marks may be worth premiums over coins that are of average for their respective numerical grade. Coins with attractive natural toning, too, tend to be worth more than otherwise equivalent coins that have less toning or have toning that may not be entirely natural. Coins that are relatively unattractive, have many mild scratches, or have noteworthy problems may sell for substantially less than prices that pertain to coins that are average for their respective grades.

W. David Perkins remarks, “knowledgeable buyers pay premiums over major price guide values for really nice EF to AU grade 1797 dollars. An average condition 1797 dollar in Very Fine can be found with some searching, for around price guide values. An exceptional VF, with natural color and nice surfaces, can be found, but you might have to look for a while.”

Perkins has collected early silver dollars since 1983 and has written many articles about them. Further, he has served as an expert consultant to auction firms when important collections of silver dollars are catalogued. It is noteworthy that Perkins was involved in the cataloguing of the bust dollars for auctions of both the Eliasberg and Newman Collections. Eliasberg’s silver dollars were auctioned by the firm of Bowers & Merena in 1997 and the Newman Collection silver dollars were just auctioned by Heritage on Nov. 15 and 16. (Clickable links are in blue.)

 Auction prices tend, on average, to be little lower than retail prices. In some cases, however, auction prices are substantially greater than retail prices. When epic collections are sold, such as those of Eliasberg and Newman, prices tend to unusually strong. Herein, I mention several auction results that have greater bearing on the purchases by typical collectors of early silver dollars.

III. ‘Ten by Six’ Stars

The PCGS CoinFacts site includes an estimate that one thousand 1797 ‘Ten by Six’ Dollars survive. In his current Encyclopedia of United States Silver Dollars, 1794-1804 (Stack’s-Bowers, 2013), Q. David Bowers (QDB) estimates, on p. 132,  that “1250 to 2,000” exist.

1797 gr a U.S. Silver Dollars of 1797W. David Perkins maintains that 501 to 1250 survive, as he rates this issue as “R.2” on the Sheldon Rarity Scale. In the Heritage catalogue of the silver coins that were in the Eric Newman Collection, it is indicated that 201 to 500 survive (via Sheldon Scale “R.3”), though that “R.3” notation could be a typographical error.

I tend to agree with QDB on the rarity of 1797 ‘Ten by Six’ 1797 dollars. I have seen a large number of these over the past quarter-century, including many that should never receive a numerical grade. I suggest that around 1400 exist, including more than a few that are ungradable.

In Nov. 2011, Heritage sold a non-gradable 1797 ‘Ten by Six’ in an NGC ‘Details holder,’ which indicates that it has the ‘details’ of a Very Good grade coin. It realized $632.50. It may not be possible to find a genuine 1797 dollar for a lower price.

Earlier, in Jan. 2011, this same firm auctioned a 1797 ‘Ten by Six’ in a PCGS ‘Genuine holder’ that, according to the Heritage cataloguer, “has the details of a Fine specimen that has been cleaned and damaged.” It brought $1725 and was one of at least three 1797 ‘Ten by Six’ silver dollars that Heritage offered on Jan. 5, 2011. A 1797 ‘Ten by Six’ dollar that has been burnished and has the details of a Very Fine grade coin then sold for $3220. Also on Jan. 5, 2011, a PCGS graded Extremely Fine-40 coin sold for $7475.

In Aug. 2010, Heritage sold a PCGS graded EF-45 coin, with a CAC sticker, for $10,925. In Sept. 2011, the Goldbergs auctioned a PCGS graded Fine-12, and CAC approved, coin for $3105.

The Eliasberg Collection 1797 ‘Ten by Six’ is NGC graded “MS-65” and is often regarded as the finest known 1797 dollar of any die pairing. The Ostheimer-Lee coin was NGC graded MS-64 when it was auctioned by Heritage in Nov. 2005. By the time it was sold by Stack’s-Bowers in their first Rarities Night event in Aug. 2011, it had been upgraded to “MS-65.” The price realized of $258,750 is hard to interpret.

If most relevant experts really concluded that this Jack Lee 1797 really merited a MS-65 grade, I maintain that it would have sold for much more than $258,750 in 2011. Is it conceivable that at true MS-65 grade Draped Bust, Small Eagle Dollar would have sold for less than $300,000 in the first Stack’s-Bowers Rarities Night event?

I have never seen the Baldenhofer-Ostheimer-Gilhousen ‘Ten by Six,’ which is PCGS graded MS-64 and could have been so graded a long time ago. The Newman-Green 1797 ‘Ten by Six’ was NGC graded MS-64+ with a CAC sticker. Bruce Morelan was the buyer, through Legend Numismatics. Within the last two weeks, this coin was PCGS graded MS-64. On Nov. 15, it realized $440,625, a strong price.

Martin Logies has “closely examined” the Eliasberg, Ostheimer-Lee and Newman-Green 1797 ‘Ten by Six’ dollars. Logies asserts that “the Newman specimen is finer than the Ostheimer-Jack Lee example” and that “the Eliasberg 1797 [‘Ten by Six’ is] the finest of the variety, with an excellent strike and exceptional luster for a 1797 dollar.”

Logies is the curator and director of the Cardinal Collection Educational Foundation. On behalf of this foundation, Logies has collected many of the most important early silver dollars that survive. The foundation’s collection of business strike bust dollars was auctioned by ANR on June 30, 2005. Additionally, this foundation was the consignor of the Carter-Knoxville 1794 dollar that Bruce Morelan acquired for more than $10 million. This foundation has also been involved in the publication of books and other educational materials relating to early U.S. coinage.

Almost all experts who I know agree that the grade of this Newman-Green coin is not in the high end of the 64 range. The $440,625 result for the Newman Collection “MS-64” 1797 ‘Ten by Six’  is further evidence that leading bidders on Aug. 18, 2011 did not regard the Ostheimer-Lee 1797 as truly meriting a “MS-65“ grade or at least three of them would have been willing to pay significantly more than $258,750 for the Ostheimer-Lee 1797.

Richard Burdick has a positive opinion of the Newman-Green 1797 ‘Ten by Six’ dollar. “Graded it 64 myself,” Richard says, “not a bad deal. It was dipped in the past [and has recovered well]. These often come with very weak breast feathers, and this one was much better struck than many of the others. There are a lot of adjustment marks on most 1797 dollars; this one had almost none. This was a pretty attractive coin,” Burdick states.

There are many other desirable 1797 ‘Ten by Six’ dollars. There is not a need to pay more than $400,000 to obtain one. Indeed, this was almost certainly an auction record for the date.

In March 2011, Stack’s-Bowers auctioned a PCGS graded AU-58 1797 ‘Ten by Six’ for $43,125. In Aug. 2011, Stack’s-Bowers auctioned a PCGS graded EF-45 for $9200. Another PCGS graded EF-45 coin realized $8884 at auction in June 2010. In that same June 2010 auction in Baltimore, a PCGS graded EF-40 1797 ‘Ten by Six’ sold for $8194. In Nov. 2012, Stack’s-Bowers sold a different PCGS graded EF-40 coin for $7590. I have not seen these and it does not make sense to draw conclusions about coins without examining them. I am here listing some prices realized to provide an idea of market prices for coins of this issue in Extremely Fine to AU grades.

In Nov. 2011, Stack’s-Bowers auctioned the George Dyer Collection, which had been assembled from around 1910 to around 1930. Dyer had a 1797 ‘Ten by Six’ that was PCGS graded Fine-12 before the auction. Although I do not specifically remember this coin, I viewed many of the coins in the Dyer Collection and I inspected the coin cabinet that was used to house this collection for decades.  Many of the Dyer Collection coins had attractive toning. This Dyer Collection, PCGS graded Fine-12 1797 silver dollar sold for $2990.

For all three die pairings of 1797 dollars, there do not seem to be recent auction records for coins that are PCGS or NGC certified as grading from Good-04 to Very Good-10. My impression is that many of these remain uncertified and trade at small coin shows.

People who collect coins in Good grades are often accustomed to holding the actual coins. I am concerned, however, that not certified, early U.S. coins that are represented as grading from Good to Fine may be non-gradable because of serious problems. In some cases, the sellers are not qualified to grade coins. In other instances, coins are deliberately mis-represented. If a collector decides to acquire a bust dollar, he or she should buy one that is PCGS or NGC certified.

IV. Nine by Seven, Large Letters

The 1797 ‘Nine by Seven’ with relatively large letters on the reverse (back of the coin) is scarcer than the 1797 ‘Ten by Six.’ Yes, I am aware that the PCGS CoinFacts site estimates “2,000” survive, twice as high as the number given on this site for the 1797 ‘Ten by Six’ dollar. I believe that this estimate of 2,000 is not accurate.

1797 gr c U.S. Silver Dollars of 1797W. David Perkins assigns a “R.3” rating to this issue, meaning 201 to 500 survive. The Newman catalogue indicates the same “R.3” rating, which is not surprising as Perkins was involved in the cataloguing of the Newman Collection.

I tentatively put forth an estimate of 875. Many early U.S. coins, especially many early silver dollars, are not gradable and are so problematic that they would not be brought to major coin conventions or consigned to major auctions. Leading specialists in early silver dollars are probably not aware of many of the problem-ridden coins that are sold at small coin shows, in coin stores, in antiques stores, by mail order from sellers who often deal in non-gradable coins, or over E-Bay.

Perkins acknowledges that he does not track many lower grade or problem-ridden 1797 dollars. “At a major show, if you can locate a 1797 dollar, it will most likely be in Fine to VF grades,” Perkins points out.

The PCGS has graded ‘Nine by Seven, Large Letters’ 1797 as MS-63 and one as MS-61. The NGC has reported grading at least three as “MS-63.” I wonder how many different pieces really merit ‘Mint State’ grades. In his encyclopedia, QDB does not list any as grading higher than MS-63 and does list two as being NGC graded MS-63. He also lists the Eliasberg and Norweb coins as each being PCGS graded “AU-58.”

The Newman-Green coin is NGC graded MS-62. Burdick remarks, “barely acceptable, but ‘Nine by Seven’ stars 1797 dollars are so important. I did grade it 62.”

I note that the Newman-Green ‘Nine by Seven, Large Letters’ 1797 has light to moderate friction, yet is very appealing in other ways. Given the criteria employed by the PCGS and the NGC, a low to mid range grade in the 62 range is probably accurate. I could understand, though, how an expert could fairly argue that a 58+ or 61 grade is more applicable. The natural toning and choice surfaces really do benefit this coin, however, and it is clearly superior to some early dollars that are PCGS or NGC graded as “MS-61.”

The price realized of $164,500 was strong, though understandable. Even collectors who assemble sets ‘by date’ often seek both a ‘Ten by Six’ 1797  and a ‘Nine by Seven’ 1797. It would be hard to find another in the AU-58 to MS-63 range. Collectors can, however, find coins of this issue in lower grades or ‘no grades’ for much more modest prices.

In Nov. 2010, Stack’s auctioned two non-gradable 1797 ‘Nine by Seven, Large Letters’ silver dollar in NGC holders. The first is said to have the details of a Very Fine grade coin. It may have been chemically altered. It brought $2760. The second is said to have the details of a Fine grade coin and the holder indicates that it has been “repaired.” That one sold for $1725.

Less than five weeks earlier in Philadelphia, at the end of the September 2010, Stack’s auctioned two others. One is NGC graded AU-53 and sold for $12,651.15.

The second that was auctioned by Stack’s in Sept. 2010 is in an NGC  holder that indicates it has the ‘details’ of a Very Good grade coin. It brought $1092.50. The exact same price was realized when Heritage sold one with a hole in July 2011. The NGC holder indicates that this holed coin has the ‘details’ of an Extremely Fine grade coin. So, 1797 ‘Nine by Seven’ dollars have recently been auctioned for less than $1100 each. Would it be fun to have one with a hole?

In September 2013, Heritage auctioned three 1797 ‘Nine by Seven, Large Letters’ Silver Dollars that are each graded EF-45, two by PCGS and one by NGC. These realized: $9987.50, $7637.50 and $8518.75, respectively.

V. Nine by Seven, Small Letters

All relevant researchers agree that the 1797 ‘Nine by Seven’ obverse, Small Letters reverse, silver dollar is rare. Most experts regard it as very rare; fewer than 250 survive. Perkins suggests that the total known “may be as low as 150.”

1797 gr b U.S. Silver Dollars of 1797In Dec. 2011, Heritage sold one that is NGC graded Fine-12 for $3116.50 in New York. A few months later, this same firm sold another in the same city that was in a PCGS ‘Genuine’ holder for $2300.

More recently, in 2012, Heritage auctioned two different ‘Small Letters’ 1797 dollars that are each PCGS graded VF-20. In September, one that may be generously graded sold for $5287.50. Less than six weeks earlier, another brought $7,931.25.

The most exciting of all the 1797 ‘Small Letters’ Silver Dollars is the Newman-Green coin. “Just this one example remains in unquestionably ‘mint state’ condition,” states Martin Logies. “I have personally examined every known” AU grade, 1797 ‘Small Letters’ Silver Dollar, “and the Newman specimen displays a far superior strike, with superb luster for the variety. It is by far the finest known” 1797 ‘Small Letters’ Dollar, Logies emphasizes.

During the Platinum Night session of Nov. 15, 2013, I was puzzled when the Newman 1797 ‘Ten by Six’ sold for more than the Newman 1797 ‘Nine by Seven, Small Letters,’ $440,625 versus $381,875! Not only is the ‘Small Letters’ variety much rarer, there are other ‘Ten by Six’ 1797s that grade in the MS-63 to MS-65 range. Furthermore, I determined the Newman ‘Small Letters’ to be of higher quality than the Newman 1797 ‘Ten by Six.’ Some of the imperfections in the strike of this coin may give the impression that this coin has friction or disturbances that it just does not have.

Yes, numerous hairlines are noticeable under five-times magnification. Even so, these are commensurate with a 64 grade and are offset by positive characteristics. The hair of Miss Liberty naturally glows and is really cool. The orange-russet and green toning in the outer fields is pleasing. Indeed, the bright center, gray and russet inner fields, and colorful outer obverse fields all contrast well with each other.

On the reverse, shimmering luster blends well with medium gray tones. This coin is more than attractive. In my view, the grade of this coin is in the 64 range and the grade of the Newman ‘Ten by Six’ is not quite as high. This coin may to some exhibit an illusion of having friction as Miss Liberty and the eagle are weakly struck on the Newman Collection ‘Small Letters’ 1797 and are relatively more sharply struck on the Newman ‘Ten by Six’ 1797.

Four days after the sale, I felt more comfortable about my determinations when Richard Burdick stated, without any prompting or manipulation, that “I did like this one more than Newman [1797 ‘Ten by Six’ dollar]; very fairly graded, more so than the Newman ‘Ten by Six,’ one of the best deals in the auction,” Burdick exclaims.

Those who expected a much higher price over-estimated the spending power of the collectors who seek three 1797 dollars for their respective collections. I contend that most collectors of high grade, bust dollars would be satisfied with one one 1797 and some feel a need for two, a ‘Ten by Six’ and a ‘Nine by Seven.’ Almost all the collectors who seek representative of all three die pairings of 1797 dollars collect bust dollars that grade below AU-53.

Ironically, the Newman 1797 ‘Small Letters’ brought a price that was only slightly higher than the auction price this coin would have realized if, hypothetically, it had ‘Large Letters.’ I theorize that it was the striking detail and the CAC sticker that together caused the Newman ‘Ten by Six’ to realize more than the Newman ‘Small Letters’ 1797. If the latter had a CAC sticker and the former did not, the Newman ‘Small Letters’ would have sold for more than $450,000.

The grading of Draped Bust type silver coins, especially silver dollars, is so difficult that even the sharpest of graders will sometimes fail to ‘get on base.’ Such grading is sort of analogous to the best of batters facing pitchers who throw dazzling curve balls, sinkers, and sliders.

©2013 Greg Reynolds 

 

 

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