$2.50 case of low supply, high demand

This article was originally printed in Numismatic News.
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There are lots of great coins including a number that very few collectors seem to appreciate and that may very well be the case with the 1808 quarter eagle. It is a truly special coin but one that does not get a lot of recognition.

To appreciate the 1808 quarter eagle, it helps to consider the period. Quarter eagles literally from the start of gold coin production had not been a high priority. We cannot be sure why but the best guess is that people simply did not ask for them. At the time, those who supplied gold or silver to the relatively new U.S. Mint were allowed to pick the denominations they wanted made out of their metal. People opted for upper denominations even though the Mint at times tried to convince them to take lower denominations, which were needed in circulation.

It has even been suggested that the only time a quarter eagle was requested was as a novelty. The mintage figures might support this as 1807’s quarter eagle production of 6,812 was the only instance in which the denomination’s mintage was more than 5,000. The situation changed very little in 1808. What did change was the design, which switched to John Reich’s Capped Bust design. Its mintage was just 2,710 pieces.

The price of any coin is determined by supply and demand, and the 1808 quarter eagle obviously had a very limited supply. After 1808, the U.S. went until 1821 before it produced the next quarter eagle, which meant that the 1808 quarter eagles in circulation received heavier than normal wear.

As things worked out, there was also some melting of gold coins around 1834 when their weight was reduced slightly. That was almost 30 years later, but it still could have seen the melting of some examples of the 1808 if they were still in circulation. It might have only been a few coins, but when you start with a total mintage of just 2,710, the loss of any example can have an impact. It also must be remembered that there were very few collectors around in 1808, and those who did exist were probably collecting cents and half cents, not $2.50 gold coins.

Another factor to consider is that the 1808 was the only year of the design, making it a one-year type coin. Once again, that may not make a major difference, but any added demand for what is an extremely weak supply can matter in terms of price.

The situation is perfect for making the 1808 quarter eagle an extremely tough and expensive date, and that is the case. Today it is priced at $26,500 and that is just in F-12. The current MS-60 price is at $175,000, up from $45,000 in the late 1990s. This shows that the 1808 is almost impossible in any grade.

Professional Coin Grading Service reports that a total of 65 examples have been graded, and of that total 12 coins have been called Mint State with a single MS-65 being the best. Numismatic Guaranty Corporation has seen 41 examples with 17 of those graded MS-60 or better, the best being a single MS-64.

It must be remembered that some coins might be counted more than once as there have probably been some submitted additional times in hopes of better grades. That could especially be true in Mint State and AU-58 because, in the case of the best examples, every point can have significant price implications.

What we see from these totals is that the 1808 is not very available at all as the two services’ combined total just tops 100 coins. The percentage of Mint State coins might be slightly better than we would normally expect but the numbers are still very low, especially if you factor in the possible added demand from type collectors who want upper-grade examples.

Clearly the 1808 quarter eagle is an extremely tough and very important coin. Its continuing price increases reflect a difficult situation where the supply is not strong enough to meet the demand, and that is unlikely to change. If anything, it might be worse, making the 1808 potentially better tomorrow than it is today.