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Building a World Class Numismatic Gold Coin Collection: The Josiah K. Lilly Collection, Pt. 11

Josiah K. Lilly Collection - Feature Graphic

By Harvey StackFounder, Stack’s Bowers ……
CoinWeek continues to post Harvey Stack’s wonderful series of blogs on not only the building of one of the all-time greatest coin collections but also how the relationship between Josiah K. Lilly and the Stack family grew over time. This week’s entry compiles parts 19 and 20, available on the Stacksbowers.com blog. If you’re new to the series, you can start here at Part 1. Or if you just need to catch up, here’s a link to the most recent issue, Part 10

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Among his many collecting interests, Mr. Lilly was an advanced stamp collector who approached this discipline with the same spirit as he did coins. He told me how he waited over a decade to add the famous “2 Cent Black” (the first stamp used in England) to his collection. Like the 1822 half eagle, when it became available, he did not hesitate.

He also told me about knowing that Col. E.H.R. Green owned the sheet of 24-cent postage stamps with the airplane printed upside down on it – the only known sheet. After Col. Green died the sheet of 100 stamps was dismantled, and taken out of it was a block of four with a plate number. This became a prize sought by many collectors. Mr. Lilly waited for two decades for a chance to buy this desirable rarity. When it came up for sale, he pursued it and got it. This stamp was known as the “Jenny,” the first plane to fly the mail.

To explain his collecting philosophy: he wanted to acquire many great rarities and, as he would say, “The opportunity might not happen again,” at least while he was alive.

The desire for completeness and to have world-class collections of the different collectibles he desired was a great motivator. He was fortunate to have been able to afford important acquisitions. As he built the various accumulations he had great pride in what he was able to accomplish.

Of course, few have the virtually unlimited funds to pursue their hobbies that Josiah Lilly enjoyed. But, one of the benefits of collecting is that pride and satisfaction can come not only from a collection of the very finest and rarest items, but also from building a small circulated coin collection of any type. Searching for, choosing, and purchasing the best possible coins (or other collectibles) within a budget can also bring a great sense of accomplishment.

It is this satisfaction and accomplishment that drives collecting at any level and makes a true collector. Over the years I have had the good fortune to know and serve many such true collectors and it has greatly affected my love and devotion to numismatists and to numismatics.

Sometimes forces interfere with a collector’s desires and plans that are not in the collector’s control or even in the control of the hobby. It was while serving the interest of Mr. Lilly and other collectors in the 1960s that Stack’s came up against certain regulations that discouraged collectors from pursuing their goals. During the post-World War II years and beyond, some gold coins issued were found to be counterfeits.

Counterfeiting has been done almost from the first day metal was used for coinage. There was always someone willing to make a quick profit by adding base metal such as copper or even silver to gold, copying a coin design and making something that looked like the “real thing”.

Coins from the Lilly Collection at the Smithsonian InstitutionDemand for gold for various reasons led to an industry developing overseas after the Second World War. Places like Milan and Florence in Italy, and Beirut in the Middle East, copied the designs of many popular gold coins and sold them to unknowledgeable collectors, tourists and the jewelry industry at a substantial profit above the intrinsic value of the coin. As the demand increased, so did the shipments made to the United States; the supply seemed endless. The American market was being ripped off because many buyers did not know the difference. The designs were so well reproduced that the coins were bought and sold as if they were genuine. Thousands of people were being fooled. Since the United States Secret Service was busy with counterfeit paper currency and received complaints only after the false coins were discovered, enforcement was difficult.

To help stop the importation of counterfeit coins, in 1960 the Office of Gold & Silver Operations (OGSO) was empowered to try to stop the false coins before they entered the United States. The OGSO required a license to import gold coins, issued by the Treasury Department. Before a gold coin could be carried into the United States or received in this country by mail, it had to receive a license. From day one the procedure caused delays and loss of sales, but it was somewhat effective in stopping the importations. However it was burdensome and restrictive to all involved.

Buying a gold coin from overseas became a much more difficult project. Collectors needed to know if they could get a license to bring their purchases into the United States before they bought the coins. If they purchased coins before having a license, they could be denied and the coins could not be brought into the country. How could buyers know what would be admitted? Hand-carried packages were examined and sometimes confiscated and held at customs houses if there was not an appropriate license. Items that came by mail could be held at the post office. While the importation of counterfeits was slowed — a good thing for all — the burden on collectors and the numismatic hobby was great. A collector, seeing a coin in a price list or auction, had to ask the seller to hold it until a license could be acquired. It was virtually impossible to get a supply into the country.

This made it difficult to add to a collection such as the one that J.K. Lilly was trying to build. In one particular instance Stack’s ran up against these licensing difficulties when a large numismatic gold coin collection was offered to the firm in 1962. The collection, comprising over 900 different coins of the world, would require months to get the appropriate license. Stack’s finally lost the opportunity to offer it at public auction, since the consignor was sick and would not wait.

The loss of this overseas collection, together with other business problems resulting from the license requirement caused Stack’s to sue. The problem was that the rules defining what could or would be licensed were never revealed by the OGSO, but the decisions were made at their sole discretion. Stack’s sued that the OGSO licensing requirements were Arbitrary and Capricious because they kept their rulings to themselves. Being a government agency the OGSO made the determinations on their own. It took until 1967 to win the case. A member of the Treasury announced the removal of the licensing requirements at a PNG (Professional Numismatists Guild) meeting, explaining, “the intent of the law had been satisfied”.

The restrictions did great harm to coin collecting and even to jewelers. However, at Stack’s we always did our best to meet the needs of our clients, including Mr. Lilly.

Stack's Bowers
Stack's Bowershttps://stacksbowers.com/
Stack's Bowers Galleries conducts live, internet, and specialized auctions of rare U.S. and world coins and currency and ancient coins, as well as direct sales through retail and wholesale channels. The company's 90-year legacy includes the cataloging and sale of many of the most valuable United States coin and currency collections to ever cross an auction block — The D. Brent Pogue Collection, The John J. Ford, Jr. Collection, The Louis E. Eliasberg, Sr. Collection, The Harry W. Bass, Jr. Collection, The Joel R. Anderson Collection, The Norweb Collection, The Cardinal Collection, The Sydney F. Martin Collection, and The Battle Born Collection — to name just a few. World coin and currency collections include The Pinnacle Collection, The Louis E. Eliasberg, Sr. Collection of World Gold Coins, The Kroisos Collection, The Alicia and Sidney Belzberg Collection, The Salton Collection, The Wa She Wong Collection, and The Thos. H. Law Collection. The company is headquartered in Costa Mesa, California with galleries in New York, Boston, and Philadelphia. Offices are also located in New Hampshire, Oklahoma, South Carolina, Virginia, Hong Kong, Paris, and Vancouver.

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