By David Thomason Alexander for CoinWeek …..
In 2016, the meteoric career of the Franklin Mint (FM) has ended in Never-Never-Land as a dusty footnote in U.S. numismatic history. Since it first burst into the headlines in 1965 until the announcement that it was ceasing production of medals, coins and collectibles early in 2003, the Franklin Mint was a worldwide marvel of merchandizing, conceived in the fertile mind of founder Joseph H. Segel and becoming an unstoppable juggernaut of collectible production and sale.
Collectors in the last decades of the 20th century would have had a hard time imagining the world without it. Accustomed to a decades-long blitz of direct mail four-color brochures, Sunday supplement ads and endless blurbs in hobby publications, collectors had come to view the Franklin Mint as a permanent, if sometimes controversial part of the numismatic landscape.
Over 50 years, the Franklin Mint’s numismatic products often generated as much debate as profit, acceptance and controversy. Books could be filled with listings of the mint’s productions, including the mint’s own catalogs entitled Numismatic Issues of the Franklin Mint, which first appeared in 1967 though dated 1965.
Sporting stiff plasticized blue covers until the volume dated 1969, this house publication was succeeded by increasingly huge editions published by Krause Publications of Iola, Wisconsin that were edited by the late Virginia Culver, past president of the Token and Medal Society (TAMS) and the American Numismatic Association (ANA).
By then the original goal of an exacting chronicle and complete listing of all FM issues had been quietly abandoned. The first editions included advertising pieces of the first years, issues struck to demonstrate new patented alloys being developed, not all of which would actually be used for medals offered for sale.
The inside story of the Franklin Mint’s beginning is unknown to most collectors today, but is familiar to me because I observed the Franklin Mint’s explosion onto the numismatic scene at first hand in 1966. My late brother, John L. Alexander (1938-1987) was a stock broker instrumental in the underwriting of the mint’s first common stock listed on the National Stock Exchange (distant third of the “big three:” New York, American and National exchanges).
John Alexander’s research in this dynamic young company interested his employers, the stock brokerage house of Hill, Darlington and Grimm, which was active in underwriting and promoting new stock issues.
FM was then only one department of a parent firm called General Numismatics Corporation (GNC), whose home town was Yeadon, Pa., not yet renamed Franklin Center. The story of the stock issue and of the beginning years of the Franklin Mint is basically the story of its founder, advertising specialties prodigy Joseph M. Segel (born 1931).
Segel was a remarkable example of the go-getting American entrepreneur, who launched GNC in 1964 with an investment of $21,000. His business experience was already extensive and uniformly successful. At the age of 13, he had launched a successful printing business before entering the prestigious Wharton School of Business administration in Philadelphia, PA.
Collectors who associate the name Franklin Mint with the cataracts of gleaming coins it struck and marketed for an array of governments or its many medal and ingot series are generally surprised to learn that most of its production in its founding year was base metal gaming tokens struck for 27 casinos, mostly located in Las Vegas and Reno, Nevada. Some of the research involved my driving all over Miami, FL, seeking examples of gaming tokens made by FM.
During 1964, silver prices began to soar, causing copper nickel-clad copper coins to come into production at the U.S. Mints and focusing avid interest on the millions of U.S. silver dollars needed to keep the casinos going “Ka-Ching!” that were vanishing overnight.
Segel watched as the clamoring public stormed the nation’s banks, eager to redeem their Silver Certificates for silver dollars from long-ignored Treasury stocks and later for silver granules from the national stockpile. Watching block-long lines form outside area banks, the young businessman was fascinated by the profits offered by coin collecting.
Segel reasoned that if fortunes were being made in selling existing coins, creating new high quality collectible coins and medals could be just as profitable. Making money by making coins was no new idea. In England, Ralph Heaton’s private mint (later called The Mint Birmingham Ltd.) struck coins by the millions for a wide variety of governments well into the second half of the 20th century. Heaton was stiffly respectable and starchy and worked with governments rather than collectors.
Segel’s first step in numismatics was actually in the field of membership-based medal series, through his National Commemorative Society (NCS). The first six NCS medals predated the creation of GNC and were struck elsewhere, but the society was Segel’s first venture in the field of “limited edition’’ collectibles. It should be noted that these six issues were omitted from future FM catalogs.
A couple of early management decisions set the tone for Segel’s NCS and later membership medal series. All were struck in Sterling silver, .925 fine, which founder Segel appeared to believe was the highest fineness available. Makers of traditional large-diameter, high-relief medals, generally chose .999 fine silver for their creations.
Segel’s series would include famous women, the history of the Catholic Church, U.S. Presidents, black Americans, international Freemasonry, space exploration and British history. Memberships were offered for relatively brief periods after which the rolls were closed, strait-jacketing all series as public entities.
NCS closed its subscriber list at only 5,249 members, issuing one 39-millimeter medal each month, which were unobtainable by frequently irritated non-members continuing to read about the series in the numismatic press. All were distinctly coin-like objects combining low relief and brilliant Proof surface.
Segel called all of these low-relief pieces “coin-medals.” The term was distinctly contrived but starkly necessary. In 1965 the vast majority of collectors in the U.S. were trained to focus on and collect coins and avoid medals at all costs. Segel resorted to this hybrid term to overcome a widely held prejudice. .
Medal series for subscribers were nothing new, but Proof-surface issues were an innovation. Traditionally, medals such as U.S. Presidential Inaugural pieces were meant to be handled and were generally supplied with artificial patination to protect their surfaces. As early as 1908, the Circle of Friends of the Medallion attracted medal collectors who received two large-diameter, high-relief fine art medals each year. In 1928 George Dupont Pratt launched the Society of Medalists that produced two high relief medals each year until 1995. These series helped make Medallic Art Company the leader in traditional medallic sculpture.
In 1961, Dayton, Ohio, coin dealer Frank Darner launched Presidential Art Medals Inc. (PAM) with its first ultra high relief 32mm medals honoring President John F. Kennedy. PAM series honored Presidents, states of the union and signers of the Declaration of Independence in this successful small-diameter format in bronze and .999 fine silver. Joe Segel was undoubtedly aware of PAM’s success, though their medals were struck in high relief by Medallic Art in New York City.
Another predecessor to NCS was Heraldic Art Company, led by Cleveland’s Robert MacNamara, who designed and built his own one story-high screw-press, worked by gravity. His medals were marketed as successors to the U.S. Half Dollar commemorative series in size, weight and general fabric. Following the “limited edition” track, some 5,000 struck of each issue for a subscription list that closed very early.
Heraldic Art made two fundamental mistakes. Serial numbers were placed on the paper envelopes housing the medals, not on the medals themselves, and the unnecessarily early cut-off left no room to expand the subscriber list after the new series attracted favorable publicity.
Another major victory for Segel’s infant CNG was the hiring of U.S. Mint Chief Engraver Gilroy Roberts, creator of the Kennedy half dollar. With remarkable courage, Roberts left a secure, if non-spectacular U.S. government civil service post to join a new and untried venture. Before his death in 1992, Roberts became a wealthy man as Chairman of the Board of the Franklin Mint.
His creative opportunities were unlimited in his new post, and in these early years great honor was paid to the Franklin Mint’s artistic staff. The name Gilroy Roberts “sold,” as in “Gilroy Roberts’ Birds,” and good use was made of it in merchandizing FM and its rapidly growing range of products.
Segel possessed limitless self confidence. Where others eased into competitive situations, testing the waters, he plunged right in. During the search for substitute metals for U.S. silver coinage, he was an active participant, distributing a cased three-piece set of dollar-size pieces called “Pattern Trial Proofs.” Designed by Roberts, these depicted historic Gardiner’s Island and its colony of fishing hawks or ospreys, located near the eastern tip of Long Island, N.Y.
Settled in 1639, the island remained in the possession of the Gardiner family into modern times. Roberts’ design featured an dramatic osprey in flight with a captured fish and the Gardiner Arms with the new F/M mintmark and the joined GR mark of the artist that had first appeared on the Kennedy half dollar.
These sets were sold nationally and their somewhat shoddy cases were a sharp contrast to later Franklin Mint packaging. The medals were struck in three composite alloys, two featuring a trace of the rare metal Columbium, which Segel hoped to sell to the U.S. Mint as a distinctive, patented proprietary alloy.
Cheap cardboard inserts in each case were a remarkable contrast to the glossy stock and lavishly colored literature of a later era. The 101 x 89 millimeter black and white card bore peculiar spellings that had seemingly not been proofread. Headed POTENTIAL SILVER SUBSTITUTES, the alloys were described as “NICON, Cupro-nickel with Columbian (sic); STERLING PLUS, `Nickel-Silver’ core sandwiched between two layers of Sterling-Silver (.925 fine); FRANKLINIUM I, Pure Nickel inpregnated (sic) with Columbian (sic).”
During 1965-1967 a variety of single medals appeared on a wide spectrum of subjects from the birth of Segel’s son Alan to the Red Rose Coin Club of Lancaster, Pa.; United Airlines first DC-8 jet flight to the Gates Mystery Car. Medal sets in albums were now offered including 45mm silver and bronze versions of the famous Thomason Medallic Bible, inspired by the 78mm originals struck in England by Sir Edward Thomason in the reign of King George IV.
Preparation of the Hill, Darlington and Grimm-directed stock issue saw Segel in super-active mode. The actual stock issue was a great success and part of the capital raised went for the purchase of a sizeable stock of silver bullion just before the metal took off toward the pricing stratosphere. Possession of this store of precious metal at an advantageous price assured the dramatic profitability of the Franklin Mint over the next several years.
Without John Alexander’s efforts this story would have taken a vastly different direction. A 39mm commemorative medal was struck for the successful listing of GNC stock on the National Stock Exchange, Feb. 1, 1967. It featured Gilroy Robert’s bust of Benjamin Franklin facing ¾ l. on its obverse, an old-fashioned glass-domed stock ticker on the reverse with the stock symbol GNC. Medals struck included 376 in Sterling and 3,750 in “Nickel-silver.”
My brother and I attended the 1967 American Numismatic Association (ANA) convention in Bal Harbour, just north of Miami Beach, Florida. The convention saw a personal-appearance blitz by an energized Joe Segel, who appeared everywhere distributing such pieces as the first Franklin Mint mini-medal, a 6mm version of Roberts’ Franklin bust and the newly adopted coat of arms of the private mint. Later mini-coins were 10mm or more in diameter but the 1966-dated pieces were “truly mini!”
Segel lost no time in cementing close relations with ANA and the Token and Medal Society. Numismatic organizations received donations of Franklin Mint stock, though one of them, the Society for International Numismatics (SIN) of Santa Monica, CA quickly sold the shares to underline and assure its continuing independence from a wealthy donor, however well-intentioned.
Scattered with a liberal hand were FM “Image Area” patterns for the gaming tokens featuring blank centers that would bear a casino logo. Such tokens still represented a significant proportion of Franklin Mint production, and VIP albums of actual gaming tokens were presented, sets of “Recommended Alloys” in Lucite holders and cased sets of assorted private issue medals by various issuers.
Segel was untiring in his search for coinage contracts from foreign governments. His company was not yet positioned to achieve this sensitive task, but he thoughtfully created 39mm crown-sized medals for well-connected charities under royal patronage, governments in exile and national resistance movements. These issues were in a sense preparations for the eventual invasion of the coinage field.
Britain’s Prince Philip, Duke of Edinburgh appeared on a medal for Variety Clubs of America in seven alloys including one piece each in platinum and gold. A “Crown of Liberty” medal honored Tibet’s exiled Dalai Lama, while Monsignor Bela Varga’s Hungarian Committee authorized a coin-like medal inscribed ESSAI, pattern, on the 10th anniversary of the 1956 uprising. Varga was the last head of government of democratic Hungary before the total Communist take-over after World War II.
Exiled King Peter of Yugoslavia and his government in exile approved a 1967 Freedom or Death medal, while the Polish government in exile produced a piece portraying Tadeusz Kosciuszko and Marshal Jozef Pilsudski. Both we inscribed ESSAI or pattern and were as close to coinage as the Franklin Mint came through 1967.
The Six-Day War between Israel and her Arab neighbors resulted in spectacular worldwide interest in Judaic numismatics. Neil Cooper’s International Numismatic Agency released Franklin Mint-struck medals of Generals Moshe Dayan and Itzhak Rabin that sold briskly. The Judaic Heritage Society of Robert Weber and Fred Betram enjoyed success with an Abba Eban medal and several ongoing series struck by the Franklin Mint but later pried from the grasp of Segel’s successors.
Many collectors were disturbed by the Franklin Mint’s excursion into pure fantasy coinage. A 1965 set of purported coins of the “Sovereign Order of Saint John of Jerusalem” attracted much debate since the authentic Sovereign Military Order of Malta (SMOM) in Rome already issued symbolic coins that were widely collected.
SMOM is the actual military and charitable Order established in the Holy Land after the First Crusade in the 12th century. The Order was later based on the island of Rhodes and subsequently on Malta until 1798. Since the early 19th century it had its headquarters on the Bocca de Leone in Rome and is a recognized sovereign entity enjoying diplomatic relations with some 30 countries. The Franklin Mint’s group was based in remote Shickshinny, Pa., and had no relation to the historic order in Rome.
Segel’s relentless pursuit of the main chance was brilliantly exemplified in his successful bid for the contract to strike and distribute the 1973 Richard M. Nixon-Spiro T. Agnew Inaugural Medal. The late medal historian Neil MacNeil in his award-winning book, The President’s Medal described the Franklin Mint as “aggressive and almost startlingly active.” First donating $113,000 in Franklin Mint stock to the re-election committee, Segel closed in to clinch the medal deal.
Outgunning the staid and traditional Medallic Art Company, he had already prepared dies for five different portraits and struck bronze and silver medals from them to display to the overwhelmed Inaugural Committee. Medallic Art thought it could guarantee $750,000 in overall sale of medals and then then-popular collector plates. Segel guaranteed $1 million and promptly whipped out a bank check for that amount, payable immediately.
Not surprisingly, Franklin Mint and Gilroy Roberts produced the Nixon-Agnew Medal. It was marketed vigorously in both Proof and antique finishes in silver and bronze, bronze goldplate along with a dazzling Inaugural Plate with the same conjoined heads. Artistic criticism of its low relief and uninspired design went unheard as this medal was a dramatic financial success.
FM also struck most of the Inaugural medals for Jimmy Carter a few years later, designed by Georgia sculptor Julian Hoke Harris. Mintages of the Carter medals were measurably smaller that the Nixon-Agnew celebration.
Secondary market value of all Franklin Mint material emerged as a festering problem in the 1970’s. GNC had originally planned to be a force in coin dealing on several levels, but after the firm was renamed the Franklin Mint this plan was abandoned.
At the time of the 1967 convention, Segel was exploring an idea that might have created a stable after-market for Franklin Mint issues: an in-house bureau directing collectors seeking past issues to possessors willing to sell such medals. Such an agency could have fostered and directed a genuine second market for Franklin Mint material, assuring retention of both value and interest.
In an inexplicable change of heart, Segel rather off-handedly abandoned this idea. No worthwhile secondary market was ever to develop, paving the way for that catastrophic loss of value that soon made nearly all Franklin Mint sets and singles a source of despair and loss for their owners and the butt of ridicule or hostility throughout the numismatic hobby.
For a time, the Franklin Mint published a list of authorized dealers who had expressed interest in handling Franklin Mint material for its possessors. Such dealers would also sell such popular items as the beautiful FM Medallic Christmas greeting cards. These dealers were soon cut off and instructed to tell buyers to contact FM directly. Their involvement had no effect in creating or underpinning an effective secondary market and the tragedy of diminishing value was not headed off by this network.
This depressing reality was slow in being understood. In the meantime, the Franklin Mint cemented relations with the numismatic community by hiring a number of numismatic luminaries for its growing staff. Included were ANA and TAMS President Virginia Culver; token specialist Ralph A. `Curly’ Mitchell; archivist Arlie Slabaugh; dealer Ed Quagliana and others.
Segel retired from the Franklin Mint in 1973, while the first bloom was still on the rose. Observers seemed puzzled at his step but Segel still had his unerring sense of timing and the firm soon evolved in a very different direction. Its stock split repeatedly but suffered alarming loss of value amid allegations of insider trading under his successor Charles Andes (died 2006).
A kind of imperial mood now governed FM leaders. The late Robert Weber who directed the Judaic Heritage Society (JHS) with his colleague Fred Bertram, told me of a bizarre meeting to which the two were summoned by Andes. “We’re taking you over,” Andes reportedly announced, adding that he knew all about Weber’s luxurious life style and financial position.
When the JHS leaders began to argue with the imperious Andes, he announced, “I’m walking out of this meeting!” and swept out. It was of course, his building and meeting room. JHS departed and continued its medal series with different manufacturers.
FM relations with the numismatic hobby rapidly eroded and the roster of “name” luminaries on staff was eliminated. Since its founding, FM had made much of its artists and their contributions to its products’ great success. Now complaints arose from the artists claiming that they were reduced to sweat shop status and all reference to them in promotional literature was gradually eliminated.
[Editor’s Note: A number of today’s U.S. Mint artists once worked for the Franklin Mint.]
However that may have been, Segel’s dream of coinage contracts was realized on a lavish scale in the 1970’s as countries and colonies great and small turned to FM to strike commemorative and Proof coins, in most cases with a few circulating pieces thrown in to assure the ever-repeated “legal tender” claims in numismatic advertising.
Entities in the West Indies, Central and South America, Africa, Asia and the South Pacific issued sets and singles designed and struck by FM. Many were marketed by Paramount International Coin Corporation of Englewood, Ohio, leading to a decades-long struggle with the State of Ohio over demands for payment of state sales tax.
Ever the leading edge, FM struck the first gold coin that American collectors could legally buy after repeal of existing U.S. anti-gold regulations at the end of 1974. This was the .900 gold Panama 100 Balboas dated 1975 bearing the explorer’s bust ¾ l. in morion and Arms of the republic. Coin World staffer Courtney L. Coffing waited in line at midnight December 31 to obtain a Proof example.
In countries such as Belize in Central America, gold coins and handsome bird designs were struck but were generally unknown to the inhabitants who continued to use coins struck in Britain with the geometric designs of Victorian times.
Complaints of excessive issue prices and rapid loss of value on the secondary market proliferated. A peak was reached with TV journalist Morley Safer’s dramatic exposé on CBS television’s 60 Minutes partly filmed at the August 1978 American Numismatic Association convention in Houston, Texas.
Safer publicized the secondary market problem to the great loss of face of the Franklin Mint. Soon after relief of a different kind came to holders to costly FM material with the 1979 Hunt brothers’ attempt to corner the silver market, which drove silver to within hailing distance of $50 per ounce.
Endless plastic bucket loads of Franklin Mint creations headed for the nation’s refineries during that orgy of silver speculation, and a significant percentage of FM material literally flowed from the crucibles as featureless silver bars to the relief of many embittered buyers.
The only loyal outcries came from Krause Publications of Iola, Wisconsin, once publishers of the catalog of FM material. Editors Arnold Jeffcoat and Russ Rulau both demanded “a serving of crow” for Morley Safer in view of the spectacular increase in bullion value of the much-derided FM issues. The irony was that the Hunt Brothers and smelters rescued holders of the items, melt value did the trick, not numismatic value or appreciation of their designs.
The Franklin Mint’s attempts to export its private Mint concept overseas are little remembered. Satellite companies in France and Germany had minimal success, and the FM invasion of the UK had elements of farce. By quick action, the agile promoter Derek Pobjoy copyrighted the name “Franklin Mint” in Britain and demanded extortionate payment to release it. FM was obliged to do business as “John Pinches Ltd.” until finally coming to costly agreement with Pobjoy.
In all the dispute over costs and secondary markets, there were no legitimate complaints about the purity or quality of Franklin Mint products at any time. FM’s Proofs were always of the finest technical quality and the purity of silver and gold offered to Franklin Mint product buyers could not be faulted. Only the vexed question of plummeting value after the first purchase remained a running sore that never healed.
The weekly newspaper Coin World tried to protect readers from substandard Proof sets and singles in the 1970’s by barring ads for items that were not shown to be Proof “as understood by North American collectors.” A Proof Board was established to critically examine coins intended for advertising. Ad privileges were denied to issues that were not, in fact, Proof. This was in accord with the official Coin World position, “the Collector is King.”
This board never voted against any Franklin Mint product.
Nonetheless it would not grant sight-unseen license to coins from that source without first examining them. Franklin Mint Vice President for Marketing William F. Krieg arrived at Coin World’s offices one day in 1975 to demand a blanket exception to this standing ad rule. After threats of legal action if such exception was not granted, the Franklin Mint became “King” and the Proof Board was abolished.
The post-1973 FM philosophy appeared to be “slash and burn,” rapid sale was chosen over a continuing presence in a given collectible area. With medals, coins and ingots plunging in value, other areas were invaded: thimbles, spoons, porcelain and metal plates, die cast car models, dolls. Here too arose the familiar complaints of high issue prices and fast-declining value.
The situation recalled archaeologists’ explanation for the disappearance of the great Maya cities of Central America. Primitive slash and burn Milpa agriculture so eroded productivity of the land hacked from the jungle that the complex urban civilization could not be sustained. Step pyramids and all, the cities were abandoned to the returning jungle.
In the numismatic world, collectors feeling victimized by sinking secondary market values of their Franklin Mint material abandoned the field and there were not enough newcomers coming in to maintain the FM’s once-lofty position.
Some observers believe that over the years, surviving Franklin Mint coins and medals could slowly gain in value, if the supply is permanently ended. No doubt the 1979-80 melts and the end of new issues will eventually focus some collector interest on what will be a closed book. The ways of collectors are surely remarkable!