Analysis of scarce coins, coin markets, and the coin collecting community #51
A Weekly Column by Greg Reynolds
On the evening of Tuesday, May3rd, the firm of Spink-Smythe auctioned the ‘Magnolia Collection‘ in New York. A 1795 Eagle ($10 gold coin) sold for a record $379,600. This sale was a small, quaint, fun auction, much different from many of the auction extravaganzas conducted by Heritage, Stack’s-Bowers, or the Goldbergs. In my view, it is extremely important that all the coins came from one consignor, the owner of the “Magnolia Collection.”
This event is very much newsworthy in that a significant group of rare or scarce U.S. coins and patterns came from a true collection of extremely fresh material. In three recent columns, I emphasize the importance of fresh material and the fact that fresh coins, on average, tend to realize higher prices at auction than coins that have recently been ‘on the market.
A ‘fresh’ coin has been ‘off the market’ for five to seven years or more. It is not necessarily attractive nor does it have to be a coin with mostly original surfaces. The freshness of a coin is not derailed if it trades very quietly or is sold in a ‘Country auction’ of furniture that includes a few coins. By ‘off the market,’ of course, I am referring to coin markets in the mainstream. A rare or scarce coin has been ‘off the market’ if it has NOT BEEN recently offered at major coin conventions, in widely recognized coin auctions, on the websites of leading coin dealers, or openly touted to numerous dealers or collectors by other means. I will further elaborate on the concept of freshness at another time.
As the ‘Magnolia Collection’ was formed in the 1960s and 1970s, it is extremely fresh. While there were some high quality coins in the collection that grade in the middle or high end of their respective certified grades, there were some mediocre or unappealing coins as well. A central reason why freshness is important is that a rare or very scarce coin that has problems, or is ‘low end’ for its respective certified grade, may realize a strong price at auction, partly because of its freshness. On average, though not nearly always, fresh coins realize higher prices.
Of course, the freshness of a coin is not the only factor. Please see my columns of Jan. 26 and April 6th for reasons as to why some coins realize strong prices at auction. I also suggest reading my piece of the meaning of auction prices.
The firm of Spink-Smythe did an admirable job of organizing and promoting this sale. Matt Orsini meticulously catalogued the coins. Tracy Shreves is an efficient and entertaining auctioneer. Also, the food served at the event was unusually good and reasonably healthy. I will remember the barbecued pineapple strips and tortilla pasted shrimp.
The combination of a true and serious collection, comprised of coins and patterns that have significance within the traditions of coin collecting in the U.S., and the extreme freshness of the collection heavily contributed to a very successful auction. Most of the items brought substantially more than I expected.
I. The Magnolia Collection
The Magnolia collector is still alive. Matt Orsini handled the consignment. According to Orsini, the ‘Magnolia’ collector “lives in the South and is elderly” now. He was never among the most enthusiastic of coin collectors. After the 1970s, he lost interest in coins. Until recently, all of his coins were raw. Most were in custom, hard plastic holders. Orsini arranged for the coins to be sent to the PCGS for grading and encapsulation.
There were just fifty-three lots in the auction, including a few world coins. Several lots had more than one coin; three lots contained more than a dozen coins.
The Magnolia 1873 Proof Set was comprised of fourteen coins, all copper, nickel and silver denominations. It was not certified and looked cool in a plastic holder. It had been a long time since I had seen an uncertified, 19th century Proof set. Though this set was probably assembled in the 20th century, there is considerable consistency in the toning.
While I have seen many 1873 Proof coins of higher quality than the pieces in this set, viewing them altogether in one holder was an enjoyable experience. The coins are colorfully toned and it is a cool set. After bidding started in the $25,000 range, a few phone bidders battled each other before this set sold for $51,850, which is more than I thought it was worth.
The ‘Magnolia Collection’ is best recognized for pre-1813 U.S. gold coins, particularly Eagles, and especially for patterns of silver and related dollars dating from the mid to late 19th century. Many of the patterns in the ‘Magnolia Collection’ are attractive and extremely rare.
Although I very much like the piece, I was astonished by the price realized for an 1871 Indian Princess silver dollar pattern, with a regular reverse. This piece, sold as lot #16, features a seated Indian Princess on the obverse (front) with no obverse outer devices other than the date (1871). The reverse (back) design is the same as that of the regular issue Liberty Seated silver dollar of the time period.
Yes, there are just two or three known of this particular variety and this one is of higher quality than the Queller piece that Heritage sold in Jan. 2009 for $40,250. (Please read my three part series on the Queller collection of patterns – click here for part 1.)
This Indian Princess Dollar pattern is PCGS certified “Proof-64+ Deep Cameo” and a fair case could be made that it merits a 65 grade. It is very attractive. The glowing Indian Princess herself, on this particular piece, is captivating. On both sides, there is natural gray-blue toning in the inner fields and russet peripheral toning. The cameo contrast, the mirrored fields and the toning are well balanced. There exist, however, many similar patterns. Finding an Indian Princess silver dollar pattern is not hard.
Bidding started at a level above $70,000! In a matter of seconds, Laura Sperber edged a Southern California dealer with a successful bid of $86,350, including the buyer’s commission.
The auction result for another Indian Princess Dollar in the ‘Magnolia Collection’ surprised me even more. The just mentioned piece is exceptionally appealing. Another Indian Princess silver dollar pattern, also dated 1871, is different from the just mentioned pattern in that there are stars on the obverse (front) and the reverse is of a design that is unlike any that was ever adopted for regular U.S. coinage. This reverse design, though, it is not very interesting.
This pattern, sold as lot #18, is PCGS certified “Proof-61” and it could be fairly argued that it merits a 62 grade. It could also be argued that it should just grade 60, depending upon how experts interpret the effects of a moderate to heavy cleaning very long ago.
For this other 1871 Indian Princess Dollar pattern in silver, bidding began in the $25,000 range. Again, there was a battle between a Southern California dealer and Laura Sperber, with Sperber winning. The final price was $54,725!
An 1879 Goloid Metric Dollar, struck in aluminum, is a little more distinctive. It is a conceptual pattern for a new design and alloy for dollar coins. Although this particular piece was struck in aluminum, a silver-gold-copper alloy was being considered. Probably, only two representatives of this pattern issue survive. This piece has wonderful natural color and virtually zero contact marks. I enjoyed viewing it. It brought $60,475, which I take to be a very strong price.
The ‘Magnolia Collection’ will and should be recognized for featuring an outstanding group of silver dollar size patterns. Nevertheless, it would not make sense to list them all here.
III. 1795 ‘Nine Leaves’ $10 gold coin
The highlight of the Tuesday night event was a 1795 Eagle ($10 gold) that features a branch with nine leaves on the reverse (back of the coin). All 1795 Eagles are immensely popular, as Eagles were first minted in 1795. Along with Half Eagles ($5 gold coins), these were the first gold coins produced by the U.S. Mint. Copper coins, large cents and half cents, were first struck in 1793 and some silver coins, dimes and half dimes, began to be minted in 1794.
While there are several varieties of 1795 eagles, only two are collected by many people who aim to complete sets. The others are die varieties of interest to specialists in early Eagles, and to researchers. Indeed, most collectors of early Eagles probably are satisfied with a single 1795 Eagle, one of the varieties with thirteen leaves, as these are much less rare and much less expensive than 1795 Eagles with nine leaves.
By tradition, the 1795 variety, with nine leaves, is listed along with the distinct dates in this series, in widely accepted guides. The nine leaves on the eagle are readily apparent. A magnifying glass is not needed to distinguish a 1795 Eagle with thirteen leaves from one with nine leaves.
On top of the branch in the reverse (back) design, an eagle is perched. Even though this representation of a bald eagle is referred to as being ‘small,’ it is not small. It is so labeled because it was replaced by a larger ‘Heraldic’ eagle motif sometime in the middle of 1797.
The current consensus seems to be that there exist between twenty and thirty 1795 Eagles, with nine leaves, though I am not convinced that this is so. Back in 2007, I estimated that the number of surviving 1795 Eagles, with thirteen leaves, is probably between 175 and 225, including at least a dozen that have never been submitted to the PCGS or the NGC. I still have a strong degree of confidence in this estimate, though I now state between 185 and 235.
The Magnolia 1795, with nine leaves, is PCGS graded MS-61 and is thus one of the highest certified of this variety. The PCGS lists three as having been graded MS-63, but I doubt that these are three different coins. Someone probably re-submitted the same coin in hopes of receiving a MS-64 grade.
Andy Lustig regards the Magnolia 1795 “as the second most desirable of the nine leaves Eagles. The most desirable was in one of the apostrophe auctions in the mid 1980s. It was later graded 63.” This “second most desirable” one has been in a leading, private collection for many years, maybe since the 1980s, according to Andy.
Lustig adds that, other than “the most desirable” one, the Magnolia 1795 “is the only high grade example of the nine leaves issue that was struck on a perfect planchet. Others look like they were struck through rocks!”
“By current standards,” Lustig continues, “this is a nice 61” grade coin, with “beautiful original color.” I, too, was extremely impressed by the quality of the strike and the color of the Magnolia 1795 Eagle. Miss Liberty and the eagle exhibit a wonderful natural mint frost. The texture of the fields is just incredible for a coin of this issue. While I have not seen as many as Andy, I have examined a handful of 1795 ‘Nine Leaves’ Eagles and none of the others has anywhere near the eye appeal of this one.
The price of $379,600 must be an auction record for this issue. I was stunned. A price of $265,000 would not have surprised me. The PCGS retail price guide value is $240,000 and auction results are often less than retail prices. “The price was very strong,” Andy says, “but completely understandable.”
IV. Heraldic Eagle $10 Coins
The ‘Magnolia Collection’ featured five Eagles with the relatively large, heraldic eagle reverse, the most extensive representation of any one gold coin type in the whole collection. This type of $10 gold coin dates from 1797 to 1804. Eagles were not minted again until Proofs were made for special presentation sets in the mid 1830s. (Please see my column of July 28th for a discussion of a Proof 1804 Eagle that was struck in 1834 or ’35.)
The Magnolia 1797 Eagle is PCGS graded AU-55. It is acceptable as a 55 grade coin, though it is not ‘high end.’ There is nothing really special about this specific coin. The issue is rare, possibly very rare. Relatively high grade representatives are not that difficult to find, and I have seen better 1797 Eagles.
The PCGS price guide values this 1797 Eagle at $33,000 and the Numismedia.com retail price is $28,750. In August 2009, Heritage sold one with the same certified grade for $29,900. In Jan. 2011, DLRC sold one that is NGC graded AU-58, in an Internet Sale, also for $29,900.
Tuesday evening, bidding for this coin started above $25,000. Andy Lustig bid $26,500. A Southern California dealer bid nearly $28,000, including the buyer’s commission that would have been paid had his bid been successful. Next, a telephone bidder chimed in at $30,000. Laura Sperber indicated $33,450. A telephone bidder was then successful for a price of $34,600, which is more than I expected.
The Magnolia 1801 Eagle is PCGS graded Extremely Fine-45 and is of average quality, at best, for an 1801 Eagle of this grade. In my view, $16,200 is a strong price. This same coin would have brought a higher price had it been auctioned in 2007 or early 2008. This is a high price for it in 2011.
There are two 1803 Eagles in the Magnolia collection, one is of the ‘Small Stars Reverse’ variety and the other is of the ‘Large Stars Reverse’ variety. Most collectors of early Eagles would be happy to own a representative of one or the other.
The Magnolia ‘Small Stars Reverse’1803 is PCGS graded AU-55. This coin brought $32,300, a retail level price, which higher than values listed by PCGS, Numismedia.com, and other guides.
The Magnolia ‘Large Stars Reverse’ 1803 is PCGS graded AU-53. I find it to be a better coin than the just mentioned ‘Small Stars Reverse’ 1803 Eagle. Though a little unnaturally bright from a dipping long ago, it does exhibit an appealing natural green color. Furthermore, this coin was well struck. Moreover, it has the sharpness of a grade higher than 53. Despite some hairlines, it is better than most such early Eagles. Laura Sperber battled a California dealer and two telephone bidders before capturing this coin for $28,850.
V. Bust Left $5 gold coins
The Bust Left Half Eagle type was minted from 1807 to 1812. The ‘Magnolia Collection’ had three. An 1807, PCGS graded AU-58, sold for $10,450, to Sperber. This is a moderately strong price for a ‘low end’ to mid range coin. An 1810, with the same PCGS grade, sold to telephone bidder #29 for $12,175, a very strong price. This 1810, though, is hard to interpret.
An 1809/8 overdate is one of the stars of the ‘Magnolia Collection.’ It is PCGS graded “MS-64+.” I like the coin. It has nice natural toning, mostly a pale green color with very light russet outer fields. Andy Lustig likes it more than I do, “beautiful original coin, premium quality 64,” Andy says.
Lustig bid on this 1809/8 Half Eagle, though he did not come close to winning it. Laura Sperber was the underbidder, at $69,100. The Magnolia 1809/8 sold to telephone bidder #29 for $71,975, which is curiously very close to the PCGS retail price guide value of $70,000.
VI. Gobrecht Dollars
Ever since Walter Breen and R. W. Julian put forth a case that some 1836 and 1839 Gobrecht Dollars were minted for circulation, and were thus regular issues rather than patterns, these have been extremely popular. Many type sets include a Gobrecht Dollar.
There were two 1836 Gobrecht Dollars in this auction, both have the starless obverse and starred reverse. It is not practical to discuss the technical differences between these two Gobrecht Dollars here. Importantly, likewise, I am not raising the issue of which Gobrecht Dollars are “originals” and which are “restrikes.”
The first Magnolia Gobrecht Dollar, sold as lot #12, is PCGS certified Proof-55 and the second is PCGS certified “Proof-62+.” The first went to a telephone bidder, #24, for $19,650. Other than having been moderately cleaned, this coin did not seem to have any issues. This Gobrecht is very brilliant and flashy. The gray toning is typical for such a coin. I found ’55’ to be a very fair grade. The auction result is reasonable.
As for the second one, I am not completely comfortable with the “62+” grade, though I understand the probable reasoning of the PCGS graders who evaluated it. In any event, this Gobrecht Dollar has full mirrors and a nice look overall.
For the second Magnolia Gobrecht Dollar, a Southern California dealer was the successful bidder for $28,850, a somewhat strong price. Coin business veteran Scott Mitchell informs me that he “was the underbidder,” though I was not looking in his direction as this coin was going ‘under the hammer.’ The Magnolia collector focused on regular issue and pattern, silver and related dollars, including Trade Dollars.
VII. Trade Dollars
The Magnolia Collection contained a significant run of Trade Dollars, most of which are Proofs. These brought very strong prices overall, unless the demand for Proof Trade Dollars has recently shifted considerably upwards.
An 1876 that is PCGS certified “Proof-63+” garnered a seemingly very high price of $5275. An 1880, “Proof-63+ Cameo,” sold for $4700, another high price. An 1881, PCGS certified “Proof-63,” sold for $3837.50 and an 1882, “Proof-63+ Cameo,” went for a surprising price of $5275!
Most of the other coins in the ‘Magnolia Collection’ are not particularly newsworthy. Much more could fairly and logically be said, however, about the silver dollar patterns in this auction. The ‘Magnolia Collection’ featured an astonishing group of these. It is exciting when a collection, with many rarities, that has been forgotten, or is unknown to the active coin collecting community, surfaces.
©2011 Greg Reynolds