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Can the prooflike grade be split?

2014 U.S. Coin Digest

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By Richard Giedroyc

How should I treat a coin that has prooflike qualities on only one side?
Some third-party certification services will only recognize a coin as being prooflike if both sides have prooflike qualities. How you consider such a coin is still up to the individual. We are all aware of coins with what we call split grades, one side being superior to the condition of the other. Why can’t prooflike coins be recognized this way as well? In general, a coin with only a prooflike obverse would likely be prized more highly than would a coin with the reverse being the only prooflike side since when displayed most of us would rather have the obverse viewable.

The General Service Administration sold off Carson City silver dollars during the 1970s. What portion of the Carson City Mint coinage production did this represent?
The Carson City Mint struck nearly $50 million in face value gold and silver coins between 1870 and 1893. There was an estimated 22 tons of Carson City minted silver dollars (about 750,000 coins) transferred from the mint vault to government facilities in the East after the coining operation closed.

Did a private bank operate within the Carson City Mint while the mint was in operation?
The Bullion and Exchange Bank was operating within the mint at the time the mint’s coining charter was suspended in 1893. The bank then took over the control of the continuing refining operations. When several individuals were accused (and convicted) of gold theft from the facility B & E Bank President Jacob Klein was too enthusiastic about defending these individuals, leading to public suspicion of the bank having been involved. Investigators never found any wrongdoing on the part of the bank, however Klein lost his job, and due to public indignation, the mint was never permitted to reopen due to the scandal.

Can you explain the gold theft at the Carson City Mint?
During 1894 Carson City Mint Chief Melter Hirsch Harris notified the US Treasury Department he had noticed trace elements of gold naturally occurring in silver was lacking in silver bars refined at the mint facility. These silver bars contained copper, which had apparently been substituted for the gold. An investigation indicated about $75,000 in gold (at 1894 values for gold bullion) had been skimmed from the mint during refining beginning in 1892. Mint employees James Heney, John T. Jones, and Henry Piper were found guilty and served time in prison for the theft.

Why did bags of silver dollars languish in bank vaults for decades rather than be melted once silver dollar manufacture ceased?
Seigniorage is the profit realized between the cost of producing a coin and its face value. If it costs five cents to strike a 25-cent quarter the government puts this 20-cent seigniorage profit on its books. Should the government recall that quarter and melt it, the profit must be removed from the books. This is not only the reason the silver dollars were simply stockpiled, but why the many unwanted Sacagawea dollar coins and others also remain stockpiled.

What was the reason no Carson City minted coins were struck after 1885 until 1889?
In a word, it was politics. Grover Cleveland, a Democrat, had been elected president in 1884. Previous Republican administrations had appointed the top Carson City Mint officials. Cleveland eventually realized these bureaucrats were fiercely loyal to the Republic Party. In September 1885 he simply fired everyone at the mint, shutting down the coining operation. The facility became an assay office the following year, complete with Democratic Party bureaucrats in all the key positions. In 1888 Benjamin Harrison, a Republican, was elected president. Harrison promptly appointed Republican supporters to these same positions. A year later the coining operation restarted following appropriate funding having been made available.

I know many of the rarest Morgan dollars are from the early 1890s? What caused this?
The Sherman Silver Purchase Act of 1890 mandated the government purchase 4.5 million ounces of silver monthly, with Treasury bonds redeemable in either silver or gold being issued to pay for the bullion. A significant number of bond holders redeemed the bonds in gold rather than in silver, depleting the Treasury’s gold holdings while creating the Panic of 1893 in the process. The Sherman act was repealed, however this in turn coupled with the closing of many of the silver mines in Nevada about the same time slowed the production of silver dollars specifically between 1893 and 1895, the key dates of which you inferred.

Is it practical to buy modern coins such as silver American Eagles that you can purchase encapsulated and graded?
The same rules apply – only when the coin is well known to be counterfeited/altered, or when the difference in grades is significant financially.

E-mail inquiries only. Do not send letters in the mail. Send to Giedroyc@Bright.net. Because of space limitations, we are unable to publish all questions.

 

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