By Charles Morgan with Hubert Walker for CoinWeek …..
Anthony Swiatek and Walter Breen’s The Encyclopedia of United States Silver & Gold Commemorative Coins: 1892-1954 has always been one of my favorite books. Sure, the topic’s been done better, most recently by Swiatek himself. And yes, the book is hopelessly optimistic about what was then the future value of the series. But it felt like it was written by authors who really knew the series, and understood what collectors want to know.
Taking a different approach than Don Taxay and his earlier work, the Encyclopedia made you feel like you had privileged access to the always fascinating, sometimes sketchy, inside scoop on some of America’s most interesting novelty coins.
What stands out in the minds of many readers is the peculiar way in which the book is laid out. Starting from the premise that every commemorative was created by swindlers and frauds, the coins are listed beside the Latin phrase Corpus Delicti, which means “the body of the crime” and refers to the facts necessary to the existence of a crime (as in the death of a victim in a murder case). The groups and individuals behind the pieces are identified as “Suspects” or “Accessories”, and Swiatek and Breen’s description of each coin’s design process comes under the header Modus Operandi. It gives the Encyclopedia a kind of True Crime atmosphere, and makes each story seem like an episode of Dragnet. While all along, the authoritative and collegial manner in which the authors write lulls you into a great sense of trust and camaraderie.
Little did I realize, in all the times I’ve read the book, that some of the fun and games had at the expense of the original purveyors of America’s commemorative coin series was also being had on me as well. It seems that the publishers had more at stake than just selling books.
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Maybe I would’ve known better had I been in the game in 1981, when the book came out. It was published in part by First Coinvestors, Inc., a subscription-based, coin-of-the-month dealership (the Columbia House of the not-so-rare coin industry), and, despite winning the 1981 Numismatic Literary Guild (NLG) Book of the Year Award, the Encyclopedia appears to have been viewed by the company simply as one large “advertorial” to promote their business.
To what extent Mr. Swiatek was involved with that side of things, I’m not sure. I spoke with him recently about the book, and he all but dismissed it (which makes sense in light of his recent work). He had some great anecdotes, though. On Walter Breen, for example, Swiatek said that his sole contribution was the claim that the Stone Mountain doubled die was a rare coin (it’s not). He also had nothing good to say about Stanley Apfelbaum, the man whose photo appears on the inside flap of the book.
Somehow, I missed that.
Breen and Swiatek’s bios are on the back cover. Apfelbaum’s bio is much smaller and under an ad for two other FCI/ARCO books: Morgan & Peace Silver Dollars, by Leroy Van Allen and George Mallis, and The Financial Management of Your Coin/Stamp Estate, by D. Larry and Tony L. Crumbley. I thought he had something to do with those.
He didn’t. As Swiatek told me over the phone, Apfelbaum inserted himself into Swiatek’s work. Stanley Apfelbaum was a New York lawyer (eventually disbarred), life member of the American Numismatic Association (eventually expelled), and owner of the coin industry’s first publicly traded dealership. His “fingerprints” can be found not only on the dust jacket but also in the prose itself with a “Special Investment Section” seamlessly slipped into the narrative.
So seamlessly that after all these years my view of underrated coin series was affected by what he – Apfelbaum – had to say.
The story of First Coinvestors is complex, but for the sake of our story we will focus on one small aspect of that saga.
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First Coinvestors was one of the biggest distributors of coins to non-numismatists in the country, even hiring both Walter Breen and Don Taxay (Swiatek says he never had much to do with the firm).
For a time, their ads could be found in high-powered magazines like Kiplinger’s Personal Finance. One ad circa 1980 offered a free gold Mexican 2 Peso coin (with a modest .0482 ounces of gold) when you subscribed to their $50 a year Rare Coin and Stamp Advisory. The company’s own ad copy described the periodical as something that “reports trends and special limited situations”, and “offers you a chance to buy rare coins and stamps on exceptionally favorable terms”.
The monthly Coinvestors advisory had some 30,000 subscribers in 1980, around the time the Encyclopedia was published. Most of these subscribers, we imagine, were also participating in the firm’s coin-of-the-month program.
And if that’s the case, then how difficult was it to fill orders? The very idea of a rare coin market presupposes that the coins are actually rare. By definition it’s impossible to expect 30,000 rare coins a month to be available. Therefore, despite their own claims, they (and firms like them) weren’t really dealing with rare coins, but readily available coins sold to collectors as “investment instruments”.
Which brings us to the Booker T. Washington and Carver Washington commemorative coins (all of them!)
Booker T. and Carver Washington Half Dollars by the Thousands
There was little to no interest in the Booker T. Washington and Carver Washington half dollars by 1980, despite their historical significance and interesting backstories. The coins were overproduced and undersold. An untold number were melted. Many of the coins went into circulation, while others gathered dust in clear plastic packaging.
In fact, hoards were being saved. The Guttag Brothers had many; their stash was dispersed only a few years ago. Others, too, stored these unwanted coins by the thousands. For all intents and purposes, once silver was removed from circulation, the Booker T. and Carver Washington halves were treated more like bullion than collectibles.
Yet, in a special section of the Encyclopedia (again, according to Swiatek, inserted without his permission), First Coinvestors President Stanley Apfelbaum named the Booker T. and Carver Washington sets as the first of the “Big Six”, the best commemorative coins of the 1980s.
The spiel begins, “Want to see your investment triple within a decade? I believe that might be a conservative prediction! As rare as the Grant with Star Half Dollar is, the 1954 W/C Set is harder to obtain!”
That statement is a stretch. Outside of the 1954-S, The 1954-P and 1954-D Carver Washington halves do have a fairly low distribution (approximately 12,000 each), but the Grant with Star is considerably scarcer, with a distribution of about a third of the Carver Washingtons. Still, an argument can be made that the complete, unbroken sets (not the individual coins) were harder to come by (the lower mintage coins were sold only in sets and the higher mintage coins were sold as singles).
Apfelbaum goes on to describe how Coinvestors bought $135,000 worth of these sets at below wholesale and shipped them to their clients, adding that by the time all of the coins were dispersed, the wholesale cost had risen almost 100% and that their customers could turn a very strong profit should they choose to sell the coins now.
I asked Swiatek about the investment potential of the Booker T. and Carver Washington halves. We were curious if he still felt bullish about them, since whatever gains the series made were busted by the commemorative market collapse, and most of the coins are easy to get. We thought he might. To our surprise, Swiatek didn’t think the coins had much potential at all.
He then recalled an anecdote about how a planeload of the commemoratives was flown into New York, and how a crate filled with them spilled out onto the tarmac while handlers were unloading cargo. Who knows how many coins were scuffed beyond recognition in that calamitous event? The impression it gives us, however, is that these coins were neither scarce nor a great “investment” opportunity. Instead, it seems that Apfelbaum was promoting the coin and playing his subscribers for fools.
An Increase in Value or the Absence of Low-Hanging Fruit?
We have our doubts that these coins saw a real increase in value, as Apfelbaum suggests. To understand why let’s look at two different market factors.
The first factor supposes that there’s less supply than demand, which means that those wishing to purchase the coin after the supply runs out will have to pay more to entice owners to sell. It’s a fundamental, almost simplistic economic concept that should paint a fair picture of the coin market (what kind of market we actually have is a whole other series of articles). So, in order to figure out whether there’s enough supply to meet demand, we must figure out what the supply is and what the demand is. Simple enough, right?
In my recent interview, I asked Swiatek how many people collect the series. He was reluctant to speculate, saying it’s impossible to know. We’re sure he’s right – to an extent. You can’t know exactly how many people collect a series to the last digit, but someone in the business of selling the coins should have some idea of how big their own niche in the marketplace is.
With the acquisition of so many Booker T. and Carver Washington commemoratives, we assume that a large portion of First Coinvestors’ 30,000+ subscriber base was (for a time, at least) into the Booker T. and Carver Washington market. They were the ones for whom the coins were purchased and they were the intended audience for Apfelbaum’s encomium in the Encyclopedia. But outside of those customers, was there enough demand to truly elevate the value of the series?
Clearly there was no demand for the series at the outset. And one or more stakeholders in the series had enough coins to sell First Coinvestors a whole airplane full of half dollars. Apfelbaum says that the firm bought the coins below wholesale. If they were bought at melt or close to it, then First Coinvestors bought about 45,000 individual coins. A fraction of the total mintage, but a surprising number not in collectors’ hands some twenty-five years after the last coin was struck.
How many more such hoards existed and how many of those could be purchased at such a price? If First Coinvestors were offered a second load of coins similar to the first, would they have bought it? And if so, would they have sold their large subscriber base the same coins a second time? If they did, how many times could someone get away with that?
In truth, First Coinvestors was creating demand that didn’t exist before. And if the wholesale value of the coins doubled, it probably had more to do with low-hanging fruit being plucked. If the remaining coins were scattered across the country in smaller lots, it stands to reason that the cost of acquisition would be higher than that of the hoarded coins. This is fairly standard in wholesale buying. The more concentrated the stock is, the less it’s worth. The less stock a seller has, the more they tend to value it. Just because First Coinvestors said the price doubled, it doesn’t mean that the new owners were going to benefit from any gains. It just means that First Coinvestors would have to spend more money to obtain large quantities of the coins.
The second factor, which gets back to our question about how many people collect the coins, is the collecting behavior of series specialists. We broke this behavior down into the following categories:
- Casual collectors who might buy the occasional piece here or there, whatever strikes their fancy. In other words, not specialists at all (but potentially so).
- Collectors attempting to assemble the 50 coin type set.
- Collectors after all 144 coins in the classic commemorative series.
We estimate, based on PCGS and NGC Set Registry rolls, that the number of collectors going for the 50 coin type set outpaces those trying to get every last commemorative issue by a factor of two to one. We also suspect (since every single issue in the series can be had at any time without much effort) that the combined total of set builders plus random coin accumulators and casual buyers doesn’t even come close to the distribution totals of any but the scarcest issues in the series.
Simply put, even if First Coinvestors had bought all of the largest stashes, and stealthily attempted to promote multi-year series like the Booker T. and Carver Washington in Swiatek’s book, the coins had nowhere to go in terms of future value. Even the lowest mintage issues of the Booker T. and Carver Washington sets were treated as type coins. There was no real push from the mostly white coin collecting public to pay premiums for these African-American-themed coins.
Mintage alone doesn’t drive demand.
The Coins Today
Typically, coin collectors are savvier than marketers. Even if they were duped once, they figure it out. The Booker T. and Carver Washington coins might not be the underrated series we thought they were when we personally started analyzing classic commemoratives, and we admit that we were taken in by the seemingly earnest “advice” inserted into an otherwise cool book.
The facts, however, don’t bear out the hype. Buyers don’t pay much mind to low-mintage, branch mint coins in nearly any type set in the classic commemorative series, and they certainly don’t for the historically besmirched, massively overproduced Booker T. and Carver Washington series.
If you bought into the coins in 1978, we hope you got out while the market was hot. Or that First Coinvestors sent you some really nice, conditionally rare pieces.
Not all of them fell off the truck… right?
With special thanks to Anthony Swiatek, without whom none of this may have seen the light of day.
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 Swiatek, Anthony. Telephone Conversation. January 2013.
 First Coinvestors, Inc. Advertisement. Kiplinger’s Personal Finance. April 1980.
 Swiatek, Anthony and Walter Breen. The Encyclopedia of United States Silver & Gold Commemorative Coins: 1892-1954. New York. ARCO Publishing/ F.C.I. Press. 1981. Page 279.
Swiatek, Anthony and Walter Breen. The Encyclopedia of United States Silver & Gold Commemorative Coins: 1892-1954. 1981. Print.
Taxay, Don. An Illustrated History of US Commemorative Coinage. ARCO, 1967. Print.