CoinWeek First Look at the New York Bank Morgan Dollar Hoard Pops

By Charles Morgan and Hubert Walker for CoinWeek …..
Sixteen sealed original bags of Morgan dollars aren’t something you expect to see these days, given that it’s been more than 50 years after Treasury Department vaults were emptied by silver speculators. There have been ups and downs in both the silver and the rare coin markets since that time, so there has been more than enough motivation for these original 1,000-coin bags to have been opened, rifled through, and sold.

A few months ago at the Long Beach Expo, coin dealer Jeff Garrett tipped us onto the fact that a small hoard of dollar bags might be available as he had recently been contacted by a family that had inherited a number of them. In total, the family’s holdings amounted to a little more than 16,000 coins: a handful of loose pieces and 16 unopened bags.

Jeff recounts the story in his June 28 article, “Numismatic Time Capsule – Examining a Hoard of Morgan Dollars“, where he details the work involved with removing the bags from the bank and carefully opening them so as not to harm the coins (or the bags, which are collectible in their own right). Jeff was joined by NGC Chairman Mark Salzberg on the trip, and with their approval, CoinWeek is able to provide the collecting community the first in-depth look at the New York Bank Hoard and what it means for the market.

Jeff, always upbeat, was very excited about the deal, even before seeing the coins. Upon receiving the grades, he felt that the bags yielded about what he expected. He put an estimated value of the hoard at about $1.2 million USD. CoinWeek’s own internal analysis closely mirrors that number.

Mark summed up his feelings this way:

“Every collector dreams about having the opportunity to examine un-searched and fully original bags of vintage coins. This was an incredible thrill for me, particularly because the hoard had so many high-grade pieces, including 118 that graded NGC MS 67.”

So what’s in the hoard? Let’s take a look!

Coin-by-Coin Breakdown

In the first year of issue, the San Francisco Mint struck 9,774,000 Morgan dollars. It was the first issue in a run of high-mintage years that lasted until the West Coast branch mint found itself inundated with coins and decided to greatly reduce the pace of production. By 1884, the production of S-Mint dollars had been cut to 3,200,000, and in subsequent years it was cut considerably more. It wasn’t until 1896 that San Francisco would strike coins at a level remotely approaching the early common-date issues.

Numismatist Q. David Bowers notes in his excellent Encyclopedia that roughly one third of the mintage of the 1878-S circulated in the years immediately following the coin’s production. The remainder trickled out over the years.

Thousands of bags of the coins remained intact in government storage through the late 1950s, as demand for silver dollar bags began to heat up. During the 1962-64 run on dollar coins, it is estimated that between half a million to 600,000 coins (the equivalent of 500-600 bags) were withdrawn by speculators and coin dealers.

This great release of Mint State coins made the 1878-S one of a dozen or so affordable “type coins” that proved to be a popular gateway for new collectors coming into the hobby. It’s a status that remains true more than 50 years later.

CoinWeek IQ Hoard Insights:

The overwhelming majority of 1878-S dollars certified by NGC fall within the MS63-MS64 range. Of the 48,568 grading events reported in the NGC census at the time of publication, 73% fall within this grade range. The New York Bank Hoard adds 571 coins to the pops, with 470 pieces in MS63, 97 in MS64, one in MS64+ and one in MS65. These grades are in line with what we expected to see given the issue’s established grading history, and as these are typical grades, we do not anticipate any decline in market price for the 1878-S in any of the grades represented here.

• Estimated Hoard Value by Date: 1878-S =  $63,660

Whereas the 1878-S hoard bag realized coins limited to the grade range of MS63 to MS65, the 1880-S two-bag haul fell well within the lines of what one might expect for the much better San Francisco issue. The 1881-S may be the ultimate Morgan dollar in terms of overall quality, but the 1880-S is not far behind.

It’s also an issue that is plentiful today in Mint State thanks to the fact that a sizable portion of the mintage was not distributed until the 1950s and ’60s. The New York Bank Hoard contained two unopened bags of 1880-S Morgan dollars, a typical distribution for bags from the ’60s.

CoinWeek IQ Hoard Insights:

Again, we have a Morgan dollar issue where the typical grade is in the 63 to 65 range. Out of a total of 151,545 grading events reported by NGC, 83% (125,809) earn one of these three middle Mint State grades – with the majority of this percentage grading 64 (60,626).

Among the two bags of 1880-S dated coins in the hoard, 541 pieces graded MS63. A further 607 graded MS64; seven graded MS64+; 380 graded MS65; and 13 graded MS65+. But while previous NGC populations lean towards 64 and 65, there are more 63s here than 65s. Still, the overall pattern is similar enough that one should not expect prices in the middle range to change much (if at all) due to the release of this hoard.

Higher grades are represented by 212 in MS66, 18 in MS66+, and 28 in MS67. The 18 examples graded 66+ are a higher proportion of the NGC pop report, but we’re still just talking about low single-digit percent increases in populations, so little should change pricewise.

• Estimated Hoard Value by Date: 1880-S = $192,665

By far the most attractively struck emission of the series, the San Francisco Mint’s Morgan dollar of 1881 has long served as a great popularizer for the series. It is truly the ultimate type coin.

In 1881, the Philadelphia Mint and its branch mints in San Francisco, Carson City, and New Orleans, began to struggle under the burden of Congress’s mandate to produce millions of silver dollars each year. There simply was not much in the way of demand for them, at least not in quantity.

The 1881-S, as you will find was the case with several of the New York Bank Hoard Morgan dollar bags, sat idle in Treasury vaults by the millions and were liquidated only because of the run on silver in the 1960s.

In fact, if one were a coin dealer or speculator in numismatic coins in the the 1960s, pulling a bag of 1881-S dollars might have been a non-desirable outcome as there were other, scarcer dates in bags… including seldom encountered bags of Seated Liberty dollars!

Fortunately, with the development of third-party grading, collectors and investors breathed new life into this type coin and it has since been a perennial favorite due to the high-quality look most examples exhibit.

CoinWeek IQ Hoard Insights:

According to NGC, the Mint State 1881-S is found most often in the 63 to 65 range, with not-insignificant numbers in both 62 and 66–a slightly wider spread than the previous two issues but understandable considering the date’s sizable survival rate. Of the 256,498 total NGC grading events, the 63-65 population (217,363) represents almost 85% of the whole.

At 420 new additions to the pop report, almost twice as many 63s were in the New York Bank Hoard for this issue as were 64s at 253 examples. And those are the “big” numbers; there are also six graded MS64+, 94 graded MS65, six graded MS65+, and 23 coins graded MS66. The increases in Mint State NGC populations for the 1881-S are de minimis and should not effect prices.

• Estimated Hoard Value by Date: 1881-S = $64,805

By 1883, leadership at the Mint had become apoplectic by the surpluses of silver coin it was forced to strike and store in its vaults. In a report to Congress, Mint Director Horatio Burchard continued his call for an end to dollar coin production until public demand warranted resumption.

Despite the obvious implications for the Mint, the Treasury, and the government’s coffers, there would be no change in the law that called on the government to purchase no less than two million dollars’ worth of silver per month.

Nevertheless, the New Orleans Mint had a fair record of distributing its dollar coins. It did not release them at parity with production, but it did send millions of coins out into the wild. Some of those coins circulated up the Mississippi and throughout the American interior.

Most, however, circulated very briefly and made their way back into storage. These “cup of coffee” coins were barely circulated and could pass as Mint State to the non-trained eye.

The 1883-O is one of a handful of O-Mint dates that came out in droves in the 1950s and ’60s. The presence of one bag in this hoard should come as no surprise.

CoinWeek IQ Hoard Insights:

The 1883-O is reasonably common in low-to-mid Mint State, with most graded specimens at NGC earning a grade of 63, followed by 64. Together, these grades represent over 79% of the 138,662 examples of the issue certified by NGC.

And the New York Bank bag matches up. There are 524 pieces graded MS63, one graded MS63+ Prooflike, 151 graded MS64, and three at MS65. These tiny upward increments, all less than one percent of current populations, will quickly be absorbed by the market.

• Estimated Hoard Value by Date: 1883-O = $53,440

The coiners at New Orleans found a way to add a million more coins to its production schedule in 1884. The added burden came from the U.S. Mint’s inability to continue to strike and store silver dollars at the San Francisco branch. The Carson City Mint, which was active at the time, was too remote and ill-equipped to take on dollar coin production at a massive scale.

Millions of 1884-O dollars made their way to the melting pot after Congress passed the Pittman Act in 1918. Still, between a copious number of surviving examples worn in all grades and hundreds of thousands that survive in Mint State, the 1884-O has never been a scarce issue.

CoinWeek IQ Hoard Insights:

Mid-grade 64s and 63s are typical for the Uncirculated 1884-O, consisting of almost 81% (179,861) of NGC-certified coins (222,883). Here we see more or less proportional representation from the New York Hoard, though there are more 64s in the pop reports than 63s: 505 graded MS63, 225 graded MS64, 36 graded MS65, and 18 graded MS66. There are also a smattering of star, plus, Prooflike and Deep Prooflike grades–the only such issue from the hoard to demonstrate such broad coverage across the available grades.

All together, the hoard dollars dated 1884-O total 829 pieces… hardly a dent in an issue that NGC has certified more than 226,000 of, though the dozen-and-a-half 66s will certainly be welcomed by many collectors.

• Estimated Hoard Value by Date: 1884-O =  $52,020

1885 was an interesting year for America. Financially, it marked the end of a three-year economic panic. The public also mourned the loss of two giants of the American political scene: Civil War general and former U.S. president Ulysses S. Grant, and sitting Vice President Thomas A. Hendricks. succumbed to cancer, dying on July 23. It had been known that Grant was ill when he succumbed to cancer on July 23. Hendricks’ passing, however, was unexpected; he died in his sleep on November 25 after taking ill only the night before.

One hundred and 40 miles to the southeast, the Washington Monument was finally completed after years of cost overruns and an illegal takeover by the nativist Know Nothing Society. Meanwhile, Frédéric Auguste Bartholdi’s colossal Statue of Liberty arrived via the French steamer Isère.

1885 also marked the ninth year of Morgan dollar production. Philadelphia led the way by producing the most dollar coins for the year but was aided considerably by the large output of the New Orleans Mint, which produced just over nine million coins.

As a collectible coin, the 1885 was distributed on a regular basis throughout the 20th century and released in quantity in the 1950s and ’60s. Quality runs the gamut from dull and lifeless to attractive and superb. Prooflike and Deep Mirror Prooflike coins appear with enough regularity that they can be had for a small premium up to the gem grades, where prices drift apart significantly.

CoinWeek IQ Hoard Insights:

Repeating a pattern we’ve seen a few times by now, Mint State 1885 Morgan dollars from the New York Bank Hoard reflect NGC’s populations for each grade (with the 63s and 64s flipped around). While the 424 coins graded MS63 are the most common of the hoard specimens, MS64s are more numerous in the NGC Census. Together, though, 63 through 65 are far and away the typical Uncirculated grades for this issue, making up over 88% of NGC’s recorded population.

In addition to the MS63s and the 314 coins graded MS64s, the New York bags yielded 19 MS64+ examples, 104 MS65s, four MS65+ specimens, 25 MS66s, one 66+, and four 67s. These should enter the market peacefully, and the new 67s might actually push the market upwards a little bit.

• Estimated Hoard Value by Date: 1885 = $70,730

As we wrote above, the 1885-O’s considerable mintage of 9,185,000 was half of what the Philadelphia Mint was compelled to strike in order to remain compliant with federal law. Of course, demand for the coin in the 19th century was light, at best. By the mid-twentieth century, a significant accumulation of original bags of the issue remained in Treasury vaults. The hoard’s original investor received two bags of the issue out of his 16 bag haul.

CoinWeek IQ Hoard Insights:

With a total of 1,759 pieces, the 1885-O gives us the second-highest tally of Morgan dollars from the New York Bank Hoard. And at 218,329, the New Orleans issue has the highest total population of NGC-certified 1885 Morgan dollars in the census. This means that the 865 hoard examples graded MS63 and the 615 pieces graded MS64 will not make much of an impact on the pop reports for those typical Mint State grades (which come in at 74,294 and 93,491 grading events, respectively). For this common-in-gem issue, getting a fresh batch of coins in 66 and 67 could be an opportunity for the picky collector.

• Estimated Hoard Value by Date: 1885-O = $128,865

By 1886, the United States Mint’s obligation to strike tens of millions of Morgan dollars each year had created quite a pressing problem for Philadelphia. The San Francisco branch had just about reached capacity and could store no more. The New Orleans Mint, reconstituted after the Civil War, ostensibly to take part in this bullion coin boondoggle, was pumping out coins by the millions. But with nowhere to put the surplus, it became increasingly the responsibility of the mother mint to manage the Congressional mandate.

For its part, the Philadelphia Mint struck 19,963,886 dollar coins in 1886; a high water mark for the time (that number would be eclipsed in 1887 and then again in 1889). The issue has never been scarce in Mint State as bags of this issue were distributed in number on a regular basis over the decades preceding the great Treasury releases of the 1950s and ’60s.

In a 16-bag hoard, one might expect more than one sack of 1886 Morgans as the odds of getting one was far better than 1:16 at the time this hoard was assembled.

CoinWeek IQ Hoard Insights:

The 1886 Philadelphia strike Morgan dollar is one of the most common issues of the series in general. Its Mint State representation in the New York Hoard is one of the lowest, however, with only 754 pieces graded by NGC.

As you can see from the graph above, the majority of those pieces are graded MS63 (540), with MS64 in second place at 177. In the NGC pop reports, 64 is the most common grade, with 58,031 examples, and 63 is in second, with 42,508 coins certified. Taking the Bank Hoard specimens as percentages of the typical NGC grades, we get increases of 1.3% for MS63 and 0.3% for MS64 – in keeping with the patterns we’ve seen thus far in our analysis. It effectively illustrates how 30 years of certified populations are in line with data “from the bag”.

• Estimated Hoard Value by Date: 1886 = $50,145

If you’ve only seen one 19th-century Morgan dollar in all of your life, it’s likely that it was struck at Philadelphia between 1886 and 1889. Of the four-year run, the 1887 seems to be the most common, but it’s a close contest.

We’ve heard stories from old-time dealers who would fly out to Washington, D.C. to pick up bags of Morgan dollars, only to get home and find out that the coins were from one of the more common dates. These bags were typically then sent to “dump banks” for liquidation. The dealer, with his initial investment back, would now travel back to the Treasury for another shot at scarcer date bags.

The New York Bank Hoard investor’s 16-bag haul netted four bags of this issue.

With 20,290,710 coins produced, 1887 saw Philadelphia pick up production slightly. This record level was born of necessity and not out of bragging rights. The Carson City Mint, now closed, emptied its surplus dollar coins into Treasury storage and the San Francisco Mint did not have the means to continue producing high volumes of dollar coins. That burden fell to Philadelphia and New Orleans.

CoinWeek IQ Hoard Insights:

The 1887 is the most well-represented issue among all the Mint State Morgan dollars of the New York Bank Hoard – which is understandable, as it’s an issue that commonly comes nice. And while 64 and 63 are still the typical grades for the date, NGC has also certified tens of thousands of 62s and 65s.

The 1,066 examples here graded MS63 are not quite two percent of the 66,408 reported by NGC at that level, and the 1,316 specimens graded MS64 are not even 1.5% of the 88,517 NGC grading events. But the 82 dollars graded MS67 represent an approximately 20% jump in population for NGC 67s overall. So while the low- and mid-grade Uncirculated 1887 Morgans of the New York Hoard may not affect prices on the secondary market, the 67s just might.

• Estimated Hoard Value by Date: 1887 = $354,475

19,183,832 dollar coins were struck at Philadelphia in 1888. A fair number circulated and still more were melted in 1918. As a collected issue, the 1888 was a middle-of-the-road Morgan dollar until the mid-1950s, when the public became aware of how many Mint State coins from the issue remained in Treasury vaults. In 1950, the coin was on par with the 1904 and the 1878 8 Tailfeathers; both issues are significantly more valuable in today’s market.

CoinWeek IQ Hoard Insights:

Of the 16 bags of the New York Bank Hoard of Morgan dollars, only 582 Mint State examples are dated 1888. The second-lowest total from the hoard, the issue is nonetheless a common date. Therefore, the impact of the relatively small tally of newly graded 63s, 64s and 65s from the hoard is bound to be minimal. However, unlike similarly common dates (e.g., 1886 or 1887), NGC records smaller numbers of mid-to-high Mint State specimens for this date.

Still, 482 coins graded MS63 isn’t quite 3% of the NGC population report for the grade, and so we do not believe that they will hurt the price of the issue overall.

• Estimated Hoard Value by Date: 1888 = $59,975

The 1889 Morgan dollar’s massive mintage of 21,726,811 would stand as a series record until the Mint was forced to resume production of the type in 1921. According to research prepared by Q. David Bowers in his fantastic Encyclopedia, large numbers of 1889 dollars circulated and a significant number were melted under the Pittman Act in 1918. The coin was scarce enough in Mint State to trade for about as much as an 1892-CC at the start of the 1950s.

When the Treasury vaults were cleared out, this perception of scarcity changed in a big way. Today, an 1892-CC in MS63 is worth about $2,300. The 1889? About $55.

Gems are scarce for the issue, as quality was not an apparent priority for the Mint over the course of their record-setting production run. As a result, seldom will you encounter an example of the issue with a great strike or flashy luster.

CoinWeek IQ Hoard Insights:

The 1889 is the highest mintage, of course, of the entire series. So when we see the same numbers for low Mint State specimens from the New York Hoard as every other issue we’ve discussed, the math isn’t really necessary. Suffice it to say that, once again, 63 and 64 are typical for the issue, and the hoard coins about to come to market represent single-digit percent increases in the certified populations. Not even the five MS66 examples represent a substantial jump in the numbers – and the 1889 does not usually come in higher Mint State grades.

• Estimated Hoard Value by Date: 1889 =  $63,615

Putting the Hoard in Context

The Redfield, Binion, and Continental Bank hoards, perhaps three of the best-known post-1964 Morgan dollar hoards, contained tens of thousands to upwards of one hundred thousand Morgan dollars. But even these popularly marketed private hoards pale in comparison to the GSA sale of over a million Carson City Morgan dollars conducted over a period of several years starting in the 1970s.

The New York Bank Hoard, in contrast, yielded just 16 bags. Still, it is the largest hoard of un-searched Uncirculated silver dollars to turn up in the last two decades.

For collectors of high-end material, fresh unsearched bags of Mint State dollars present the potential for the upper ends of population reports to take on a flood of new coins. Yet after 30 years of third-party coin grading, one would expect that new coins coming into the market would follow familiar trend lines. But this is not always the case.

On the side for the perpetuation of the top end of the certified census is the fact that Treasury bags were not handled or stored with kid gloves. These bags, as would have been the case with any bag taken from the Treasury in the 1960s, have been moved around, stored one on top of the other, and treated with absolute indifference for the preservation or condition of the coins inside.

The two dates/issues here that present us with truly outstanding yields of high-end coins are 1880-S and 1887. The new 1880-S dollars in MS67 will be easily absorbed into the market. The 1887 dollars, however, account for a nearly 20% increase in the population in MS67. This may account for a slight decline of the $1,500 market value of the coin, but then again, it might not. More choice and the allure of fresh coins likely means there will be continued interest in the date in high grade at present pricing levels. In this situation, you better be sure that you have a nice example for the grade. Coins with high eye appeal tend to hold their own over time.

Another aspect to this discovery will be the excitement generated amongst members of the general public. What may be old hat to experienced coin collectors is still something new and full of wonder to the non-initiated. In the 1950s and ’60s, when the hobby was experiencing its most explosive period of growth, regular people could still find cool coins in change or at their local bank. The immediate results of acquiring coins that were beautiful, scarce and old spawned a generation of collectors, serious and non-serious alike. In today’s hobby, one really needs to look for coins worth collecting; our present relationship with the coins in our change is not magical enough to create the spark that it once did. Having the public hear about these wonderful Morgan dollars over the weeks and months that it will take to sell through all 16,000 coins will be worth more to the industry in the long run than the $1.2 million plus dollars the coins will bring at auction.

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