Coin Rarities & Related Topics: A Weekly Column by Greg Reynolds
News and Analysis regarding scarce coins, coin markets, and the coin collecting community #177 …..
This is the seventh in a series of articles on classic U.S. coins that cost less than $500 each. The purpose is to discuss methods of forming collections of classic U.S. coins that are consistent with the traditions and evolved values in the culture of coin collecting in the U.S., without spending more than $500 per coin. It is fun and satisfying to build sets or further other collecting objectives that are considered meaningful within the rules, as opposed to whimsically buying coins that do not fit into a collection. Fortunately, for less than $500 per coin, a set of business strike Trade Dollars ‘by date’ (including U.S. Mint locations) can be almost completed, perhaps just missing two coins, or maybe even truly completed.
My research suggests that it might be almost impossible to buy an 1878-CC for less than $500, even an awful one. Warren Mills disagrees.
Mills maintains that “you probably could get an 1878-CC with moderate to serious problems for less than $500. You could definitely buy a an 1878-CC with severe problems for less than $500.” Warren, though, does not feel comfortable about coins with severe problems. He hopes that budget-minded collectors building sets of Trade Dollars are willing and able “to stretch” and buy “an original, problem-free 1878-CC,” even one in Good-04 grade, for somewhat more than $500.
The 1878-CC is the rarest business strike Trade Dollar. If Warren is correct, a set of business strike Trade Dollars can be truly completed for less than $500 per coin. He has handled a large number of Trade Dollars, including a few 1878-CC coins, over the course of his career.
Mills has been a coin collector since 1965 and a full time dealer since 1979. He is vice president and chief coin expert at Rare Coins of New Hampshire. Mills has bought and sold millions of dollars worth of classic U.S. coins of all types, including coins in all grade ranges.
I. What are Trade Dollars?
Trade Dollars are one dollar, silver coins that were first produced in 1873. Business strikes are coins produced by routine or ordinary means, not coins made via special processes. Business strike Trade Dollars were last minted in 1878. There is only one design type of U.S. Trade Dollars.
Business strike Trade Dollars were struck at the Philadelphia, San Francisco and Carson City Mints. Before 1942, Philadelphia Mint coins never had mintmarks. Trade Dollars struck at the San Francisco Mint each have an ‘S’ mintmark below the eagle on the reverse, back of the coin. A ‘CC’ mintmark below the eagle indicates that a coin was struck at the U.S. Branch Mint in Carson City, Nevada.
Although Trade Dollars and all post-1836 U.S. Silver Dollars were specified to be 90% silver and 10% copper, U.S. Trade Dollars are not U.S. Silver Dollars, even though they have the same face value, one dollar. Indeed, U.S. Trade Dollars and U.S. Silver Dollars are different denominations.
While post-1836 U.S. Silver Dollars weigh 412.5 grains (= 0.859 Troy ounce), Trade Dollars weigh 420 grains (0.875 Troy ounce) and thus contain more silver. A U.S. Silver Dollar is specified to contain 371.25 grains (0.7734 Troy ounce) of silver and a U.S. Trade Dollar, 378 grains (0.7875 Troy ounce).
U.S. Trade Dollars were not minted to circulate as dollars in the U.S., though some did. U.S. Trade Dollars were intended to be used, and most were used, for trade with people in the Orient, especially with businesses at ports in Canton and in Hong Kong.
In the 19th century, the Chinese tended to use silver items as their primary medium of exchange. Before the U.S. Trade Dollar came into existence, U.S. businessmen trading with Chinese businessmen often used silver coins of Spain, of the Spanish Empire, and/or of former Spanish colonies, especially coins of Mexico.
According to standard references, many Chinese merchants and some relevant tariff collectors in the Orient tended to prefer such ‘Spanish’ coins before U.S. Trade Dollars arrived. While I have not personally examined original, 19th century documents relating to trade in the Orient, the point that U.S. Trade Dollars were extensively used at ports in Southern China and nearby has not been seriously disputed by recognized researchers in the U.S.
During the early 1870s, U.S. citizens with interests, directly or indirectly, in silver mining sought ways to export more silver. They persuaded Congressmen and various government officials that Trade Dollars should be minted. They maintained that using U.S. Trade Dollars, rather than Spanish or Mexican coins, for trade in the Orient would be beneficial for the U.S. economy. Even though those advocating the minting of U.S. Trade Dollars were self-serving, there was considerable truth in their arguments.
It was time consuming and otherwise costly for U.S. businessmen to first acquire Spanish or Mexican silver coins before buying Chinese goods or effecting other trade with Chinese businessmen. Clearly, it made more sense for U.S. businessmen to obtain Trade Dollars from the U.S. Treasury Department rather than foreign silver coins to trade with the Chinese. Additionally, it was efficient for the San Francisco and Carson City, Nevada Mints to use silver that was mined in the Western United States.
Business strike Trade Dollars were struck from 1873 to 1878. Proof Trade Dollars date from 1873 to 1885 and constitute a separate topic. Proofs are products of a different method of manufacture. Proof Trade Dollars were sold to dealers, collectors and the general public. Besides, it would be pointless to attempt to buy Proof Trade Dollars for less than $500 each.
II. Gradable Trade Dollars
A coin that does not qualify for a numerical grade because it has serious problems is often described as having the ‘details’ or ‘sharpness’ of a particular grade. If the serious problems are not terribly obvious, then a non-gradable coin will sometimes ‘fit in’ a collection that consists mostly of coins that are gradable. For example, a coin with ‘Very Fine’ details that has been damaged on the reverse (back of the coin) may easily ‘fit in’ a set of coins that grade from Fine-12 to EF-40.
Warren Mills emphasizes that “the standard” relating to coins that the PCGS and the NGC regard as gradable or not gradable “has changed” and is not clear to many collectors. “There are a lot of coins nowadays that fifteen years ago the PCGS and the NGC would not ever have put into a holder [with a numerical grade], particularly PCGS.” So, in Warren’s view, some of the same Trade Dollars that the experts at the PCGS would have refused to grade fifteen years ago “now” have been or “could be given” numerical grades at the PCGS.
In my view, it may not be practical to acquire 1873-CC, 1876-CC and 1877-CC Trade Dollars that have been or would be PCGS or NGC graded, rightly or wrongly, for less than $500 each. Mills, however, disagrees. According to Warren, 1873-CC, 1876-CC and 1877-CC Trade Dollars that the PCGS has or would determined to be gradable could be obtained for less than $500 each. Mills adds, though, that the PCGS and the NGC often assign numerical grades to coins that Warren maintains should not receive numerical grades.
My research demonstrates that, for many individual Trade Dollars, there are very much varying opinions of among experts as to whether they are gradable. There are more differences of opinion regarding the gradability of Trade Dollars than there are regarding Liberty Seated Silver Dollars or Liberty Seated Half Dollars, which were produced during the same era as were Trade Dollars. Almost all experts agree, however, that most surviving Trade Dollars do not score highly in the category of originality.
“When circulated, Trade Dollars submitted to the CAC do not pass, it is usually because of moderate cleanings,” John Albanese reveals. “I am not surprised as many circulated Trade Dollars have problems. If you check auction records, you will find that many circulated Trade Dollars sold at auction are in Genuine holders,” and thus determined to be not gradable because of serious problems. “It is hard to find nice, never cleaned, gradable Trade Dollars, especially ones below AU-50,” John emphasizes. Albanese is the founder and president of the CAC.
Generally, gradable, Carson City Mint, Trade Dollars from AG-03 to VF-30 are extremely rare. In my view, chopmarked Trade Dollars are not gradable, as oriental characters are deeply punched into the surface of such coins. Many collectors cherish Trade Dollars with oriental chopmarks, however, for their historical and cultural significance.
Also, some Trade Dollars were tested for their silver content by way of rim filings. The number of collectors who are enthusiastic about chopmarked Trade Dollars is much greater than the number who are enthusiastic about Trade Dollars that have filed rims. Nevertheless, a very scarce, naturally toned Trade Dollar that is otherwise relatively original and problem-free, yet is non-gradable because of a filed rim, may fit well into a set of naturally toned, attractive Trade Dollars.
III. Least Scarce Dates
The least scarce dates in the series are: 1873, 1873-S, 1874, 1874-S, 1875-S, 1876, 1876-S, 1877, 1877-S and 1878-S. Except for the 1875, all of the Philadelphia Mint and San Francisco Mint issues fall in this category of the ‘not so scarce’ business strikes in the series.
Any of these in Very Fine grade should retail for less than $250 and for less than $335 in EF-40 grade. As not many VF-20 to EF-40 range Trade Dollars have been graded by the PCGS or the NGC, collectors seeking certified coins may find it easier to acquire some of the least scarce dates in EF-45 to AU-55 grades. These will usually cost less than $500.
Warren Mills asserts that “1878-S, 1877-S and 1877 Trade Dollars are relatively available. Nice, original coins can be found without much difficulty.” For the least scarce dates, “there are a lot of Fine to Extremely Fine [gradable] Trade Dollars that have never been sent to the PCGS or the NGC,” Mills adds.
Searching for naturally toned, gradable Trade Dollars in Fine, Very Fine and Extremely Fine (‘XF’) grades may be time-consuming. Nonetheless, it is fun to search for them and satisfying to find them.
“Even the chopmarked coins are usually at least XF,” Extremely Fine details, John Albanese notes. “It is rare to see an S-Mint Trade Dollar below Very Fine,” John continues. “I do not see many gradable, CC Trade Dollars below EF-40.”
Except the 1875 Philadelphia Mint issue, the better date, business strike Trade Dollars are Carson City, Nevada Mint issues. Price guides suggest that the 1875 retails for less than $350 in Fine-12 grade and for less than $400 in Fine-15 grade.
The firm of Jack Beymer is currently offering a non-certified, Almost Good-03 1875 Trade Dollar for $193.50. Not many other, sub-40 grade 1875 Trade Dollars have been offered recently. In March 2012, Heritage auctioned an NGC graded VF-30 1875 for $460.
I am here excluding the 1875-S/CC overmintmark issue. The 1875-S/CC overmintmark is a subtle variety. The CC underneath and/or about the S mintmark is difficult to discern and is not readily apparent without magnification. Therefore, this is a variety of interest to specialists in die varieties of Trade Dollars, not an issue that is needed for a set of business strike Trade Dollars collected ‘by date’ (including Mint locations).
Of course, I am aware that there are specialists in Trade Dollars who collect them by die variety. Usually, such collectors have years of experience in buying Trade Dollars and also have a sharp interest in the scientific aspects of minting technology. Collecting Trade Dollars by ‘die variety’ is way beside the point of the discussion here, which is aimed at people who have never before seriously planned to complete a set of business strike Trade Dollars.
IV. Carson City Mint
All Carson City Mint Trade Dollars are rare or scarce. Some are much scarcer than others.
It would not be easy to find a PCGS or NGC graded 1873-CC for less than $500. In March, Heritage sold a PCGS graded Fine-12 1873-CC for $881.25. This very strong price may have been a function of the reality that few Fine grade 1873-CC Trade Dollars have been submitted to the PCGS or the NGC. The PCGS has only graded two as Fine-12 and two as Fine-15, and these four 1873-CC Trade Dollars might not be four different coins.
In the June 2013 price list of L&C coins, a “VF” 1873-CC with a “HOLE” is offered for $390 and an extremely fine details 1873-CC, also with a “HOLE,” for $440. I hope that a truly gradable, Good-04 to Very Good-10 grade 1873-CC could be found by a dedicated collector. If not, a collector who will not pay more than $500 for any one coin, may have to settle for a non-gradable 1873-CC Trade Dollar.
In my view, a collector assembling a set of business strike Trade Dollars, without paying more than $500 for any one coin, should be emotionally prepared to accept at least two non-gradable Carson City Mint dates.
The 1876-CC, the 1877-CC and the 1878-CC are all hard to acquire for a price below $500. The 1874-CC is not as scarce, in circulated grades.
In March 2013, Heritage sold an NGC graded VF-30 1874-CC for $514.65. In theory, a Fine-12 to VF-20 grade 1874-CC should sell for less than $500, though there are not recent records of any such coins selling at all.
“You do not see nice Fine to Extremely Fine, CC Trade Dollars being offered often because knowledgeable collectors will quickly pay a big premium over listed prices,” Warren Mills explains. Auction records do not tell the whole story about these. “They are snatched up pretty quick” in private sales, Warren insists. There are “knowledgeable buyers [who] have a love for these kinds of coins and may keep them in collections for more than a decade. [While] you see so few of them in the marketplace,” considerably more exist than are seen, Mills reveals.
An 1875-CC is less difficult to find than some other Carson City dates. At the Summer FUN Convention in Orlando, Heritage just auctioned, on July 13, a PCGS graded VF-25 1875-CC, with a CAC sticker, for $470. On June 9, at the Long Beach Expo, Heritage sold a PCGS graded Extremely Fine-40 1875-CC for $499.38. In Nov. 2011, Stack’s-Bowers auctioned a PCGS graded EF-40 1875-CC for $460.
In his price list of July 2, Jack Beymer lists a non-certified “F12” 1875-CC for $391.50 and a non-certified “F15” for $441.50. In the June price list of L&C coins, a non-certified ‘Very Fine’ 1875-CC is priced at $400. I have never seen the Trade Dollars offered by Beymer and L&C, respectively. These are being mentioned here to illustrate the relative availability of 1875-CC Trade Dollars. Individual coins are not being recommended in this discussion.
The PCGS price guide suggests that a PCGS graded VF-20 1877-CC has a retail value of “$425” and that a PCGS graded Fine-12 1877-CC retails for “$375.” Even if these values are accurate, they are misleading. The PCGS has graded just one 1877-CC Trade Dollar as Fine-12, just two as Fine-15 and only five as VF-20! In all grades, the 1877-CC is a rare coin.
The 1878-CC is even rarer than the 1877-CC. Someone at the PCGS CoinFacts site estimates that 350 survive. I suggest that there are fewer than 275!
It would be a challenge to assembling a set of business strike Trade Dollars for less than $500 per coin. Such a quest may take years and would be enjoyable for most people who appreciate classic U.S. coins. In the culture of coin collecting, a set of business strike Trade Dollars is very important and is a noteworthy achievement for a collector who is not extremely wealthy.
©2013 Greg Reynolds
Readers who are interested in other types of classic U.S. coins, and do not wish to spend more than $500 for any one coin, may wish to click to read earlier parts of this series:
5) Liberty Seated Half Dollars
It does sould challenging to collect Trade Dollars for under $500. I can accept some problem coins as long as the problem isn’t too conspicuous. I would stretch and pay a little more for a better grade of coin, than keep all the coins under a certain price. On inexpensive Trade Dollars, I like the AU50 to AU58 range the best.
“He hopes that budget-minded collectors building sets of Trade Dollars are willing and able “to stretch” and buy “an original, problem-free 1878-CC,” even one in Good-04 grade, for somewhat more than $500.”
This comment just goes to show how apparently far removed from reality many professional numismatists are. And it also goes to show just how unaffordable a disproportionate percentage of US coins are as well.
The fact of the matter is that, unless this is the only or one of a few sets (however defined) a collector chooses, most “budget collectors” cannot afford it. $500 per coin is “cheap” by US standards but I will venture a guess that even at this price level, that most collectors collections do not consist of coins of this value. I collect world coins exclusively (which are much better than any US coin at this price level) and I have only paid over $1000 twice and over $500 maybe two dozen times.
The lack of affordability of an increasing number of US coins I see as a problem for the long term health of the hobby but itseems to be mostly ignored, especially on sites like this one.
Disproportionately, the focus appears to be on the high end which is doing well (measured in financial terms) while the “typical” collector is increasingly relegated to sift through the “left overs” which they are supposed to believe are somehow “compelling”.
I do not know how many US collectors buy classic coins at this price level and in these grades. In absolute terms, I expect it is still quite a few. And while the financial prospects are much better than with most world coins because of the demand, I would still expect most who do so to lose money over longer periods of time which I is why I believe fewer and fewer will do so in the future.