By Bullion Shark LLC ……
Among numismatists, the American Silver Eagle is certainly popular. In November 2019, the United States Mint released a limited-edition San Francisco mint mark Reverse Proof. Collectors were so enamored, the entire 30,000 minting sold out in 20 minutes.
The Mint tried to prevent hoarding by limiting sales to one per customer. Yet, despite this limitation, the sale of the 2019-S Enhanced Reverse Proof American Silver Eagle crashed the Mint’s website.
So the Silver Eagle’s popularity is undeniable. But is it really worth the hype?
Some numismatists compare buying it to investing in the Morgan dollar. In November 2020, a rare Morgan dollar variant sold for $750,000 USD at auction. Even typical Morgan dollars are reliably valuable.
And, there are so many variants, Morgan dollar collecting has become its own numismatic specialty. Similarly, there are multiple limited-edition American Silver Eagle varieties.
Because of these similarities, the American Silver Eagle is a great bullion coin if you want to hedge against inflation. And, it might be the next Morgan dollar in terms of value.
American Silver Eagle: Ideal Bullion Coin
Bullion coins aren’t used for commerce. Instead, countries mint bullion coins as investment assets. Mints print bullion coins in precious metals and weigh them in troy ounces. In the United States, the Treasury Department might grant the coin a face value but in most cases, the appraised value is higher. Congress declared the face value of the American Silver Eagle to be one dollar. The coin contains at least one troy ounce of 99.9% pure silver.
The U.S. Treasury intends American Silver Eagle coins as investment pieces and collector’s items. The IRS allows investors to contribute these bullion coins to their Individual Retirement Account (IRA) funds.
The American Silver Eagle’s composition and utility as an IRA contribution make it a good bullion coin on its own. But its unique history makes it an even better investment than most.
Background of the American Silver Eagle Coin
U.S. Mint Director Donna Pope chose the Liberty Walking design for the face of the coin. The sculptor Adolph A. Weinman originally created the design for the Walking Liberty half dollar in 1916. She also appointed John Mercanti to design the Eagle itself. Mercanti is an American sculptor who served as the 12th chief engraver of the United States Mint from 1974 to 2010.
Mercanti’s eagle design encompasses a shield, a banner, and 13 stars.
The Liberty Coin Act (1985)
The U.S. Mint created the American Silver Eagle in response to the Liberty Coin Act. Congress passed the Liberty Coin Act in 1985. Before this act, different members of Congress proposed different strategies to sell off government-owned silver, hoping to decrease the budget deficit.
The National Defense Stockpile housed most of the silver. It secures and stores raw materials for future use in combat. It maintains these materials in the stockpile. By 1976, the Defense Department had secured more silver than necessary, which affected the economy.
Previous proposals to sell off the extra silver were defeated in Congress. In 1981, the House Armed Services Committee tried to move forward with the sale, but the price of silver dropped 11% when the sale was announced. The plan was opposed by silver miners and some military leaders and was thus shelved.
Finally, in 1985, Congress came to a workable compromise: The Liberty Coin Act. This act enabled the Department of Defense to sell off extra silver without depressing the price of silver. To do this, sold the silver in the form of coins.
The Treasury purchased the silver directly from the Defense Logistics Agency. Then, it used the raw material to mint American Silver Eagle bullion coins. Sales of these coins buoyed the federal budget.
American Silver Eagle Bullion Program Extended (2002)
The Treasury had successfully depleted the National Defense Stockpile’s silver reserves by 2002 and per the original Liberty Coin Act, the Mint would stop producing the coin. The coin had served its purpose.
But since the American Silver Eagle was so popular, members of Congress pushed to continue production. In 2002, Senator Harry Reid (D-NV) created the Support of American Eagle Silver Bullion Program Act.
This act empowered the Treasury to purchase more silver on the open market. The bill specified the Treasury was to use this new silver to mint more Silver Eagle Bullions. Congress passed the act that year.
Recession Impacts Coin Value (2008-2010)
Demand for the American Silver Eagle coin skyrocketed in 2008. The United States’ economy began to slide into a recession. To keep their portfolios from failing, investors turned to bullion coins.
Between February and March 2008, American Silver Eagle coin sales increased by 900%. In April, the Mint began rationing sales of the coin. By June, the Mint was able to increase production to keep up with demand.
No Proof editions of the coin were struck in 2009, and no Uncirculated Silver Eagles were struck in 2009 and 2010. In December 2010, the Coin Modernization, Oversight, and Continuity Act empowered the Treasury to mint enough American Eagle coins to meet demand.
The act granted the Treasury once again the ability to mint American Eagle bullion coins in silver as well as gold. It also enabled the Treasury to mint more Proof and Uncirculated versions of the coin.
Despite the 2010 act, demand for the American Eagle bullions surpassed supply in 2013. Once again, the Mint rationed the coins.
In July 2015, the Mint produced a new swath of American Silver Eagle coins. These sold out in one week.
COVID-19 Halts Production (2020)
COVID-19 interrupted American Silver Eagle coin production in 2020. At the time, only the West Point Mint minted American Silver Eagle bullions. Federal regulators shut down the West Point Mint when an employee contracted the COVID-19 virus. They reopened the mint on April 1, but on April 15, the U.S. Treasury closed its West Point facility indefinitely over safety concerns.
The Philadelphia Mint attempted to recoup the loss. It produced 240,000 American Silver Eagle coins in April 2020. Evaluators label these coins “Emergency Eagles”. These emergency editions generated controversy, with collectors bought them at four times the price of West Point Mint coins.
The CDC cleared the West Point Mint to resume production at the end of April 2020.
Reverse Side Re-Design (2021)
In 2021, the U.S. Mint retired John Mercanti’s Eagle design. The new American Silver Eagle coins feature an eagle landing on a branch on the reverse side. U.S. Mint Director David J. Ryder chose Emily Damstra to create the design. Damstra’s work is biologically accurate rather than symbolic.
American Silver Eagle Value
The face value of the American Silver Eagle coin is $1.00, but most buyers appraise American Silver Eagle coins by their value in an investment portfolio.
As of 2020, the average American Silver Eagle coin is worth $30. This is slightly more than the melt value of the coin. The silver in the American Eagle is worth approximately $24.
That said, many varieties are prized by collectors. You might sell these versions of the American Silver Eagle for considerably more than $30 at an auction.
Select Silver Eagle Variants and Rarities
Silver Eagle variants and rarities have a higher numismatic value than their melt value. Here are six out of several American Silver Eagle coins that attract special interest from collectors.
In 2018, an auctioneer sold a 1990 American Silver Eagle coin for $13,000. This bullion coin has no mintmark.
The typical numismatic value of these coins ranges from $37 to $12,925. The median range for MS-70 variants hovers between $1,000-$3,000. Collectors generally sell 1990 Silver Eagles in lower grades for less than $200.
In 2013, auctioneers sold a 1994 American Silver Eagle coin for $11,163. This was unusual. Most collectors have sold MS-70 1994 Silver Eagles for $1,000-$6,000.
The value of this 1994 silver bullion shot up in 2000. It hasn’t regressed towards the mean yet. But, so far, auctioneers have only sold lower-rated versions of this coin for less than $200.
2008-W Reverse of 2007 Variety
In 2007, the U.S. Mint abruptly altered the intended design for the 2008 Silver Eagle coin. As a result, the Mint accidentally struck some 2008 coins with the reverse 2007 die.
These reverse-strike error coins are comparably rare. Numismatists estimate only 45,000 of these coin variants exist.
Very few collectors have auctioned these variant coins. In 2013, one collector sold a reverse-2007 Silver Eagle variant for $3,190. Numismatists estimate the typical value of these variants ranges from $475 to $1900.
1993 Philadelphia Set Variant
To celebrate its bicentennial in 1993, the U.S. Mint released a special edition set of Silver Eagles. The Philadelphia sets included an American Silver Eagle Proof, an American Gold Eagle Proof, and a U.S. Mint Bicentennial medal.
In 2013, a collector sold a Silver Eagle Proof from this set for $7,638. Notably, this coin is rare because it is Uncirculated and MS70.
The 1999 American Silver Eagle bullion coin holds the auction record. In 2013, auctioneers sold an MS-70-rated American Silver Eagle for $13,000.
While there isn’t a clear reason numismatists value this 1999 variant so highly, we can make a few guesses. 1999 was the only year the West Point Mint and Philadelphia Mint produced this bullion coin.
The bullion version bears no mintmark. While there are plenty of Uncirculated 1999 Silver Eagles, high-end versions are rarer.
Evaluators estimate over seven million of these coins survive. But few of them are MS70.
You’ll typically find 1999 American Silver Eagle coins selling from $33 to $9,899. The median range hovers between $100-$200.
Will the Silver Eagle Coin Be Worth More Later?
Interest in Silver Eagle coins is growing worldwide. New buyers in Hong Kong, Singapore, and China have only pushed demand upward. As the U.S. Mint continues to produce new mintings, the coin’s popularity seems contagious.
No one can predict the exact value of a coin in the future. But, as a bullion coin with a unique heritage, the American Silver Eagle is shaping up to be a wise investment.