The history of the 1926 Peace dollar is an interesting one, as it shows how the availability of silver dollars depended in large part on what bags were being released at a given time.
The 1926 Peace dollar came along after the period of heaviest Peace dollar production had been completed, a time of severe pressure for the mints, as the secretary of the Treasury wanted more than 200 million silver dollars in a hurry to back a new issue of Silver Certificates.
The Pittman Act of 1918 allowed for the melting of up to 350 million silver dollars. More than 270 million were melted, but until they were replaced, there could be no new Silver Certificates.
As we see by the mintage, production was heavy in Philadelphia, where more than 51 million Peace dollars were made in 1922, followed by more than 30 million in 1923, and more than 10 million in 1924 and 1925.
In 1926, however, the total dropped to just 1,939,000. The low total indicated that the goal of producing more than 200 million silver dollars had been reached and at that point they were simply using up silver acquired for the project, as all mintages dropped, and after 1928 there would be no additional production for years.
Once made, the 1926 Peace dollar had no real purpose except to sit in vaults backing Silver Certificates. That may explain why in his book, American Coin Treasures and Hoards, Q. David Bowers points to a 1941 advertisement in The Numismatist that calls the 1926 the scarcest coin in the series. That came to an end in 1944, as bags were released. There are reports from a number of leading experts suggesting the coins in the bags were heavily bagmarked.
The 1926 would continue to emerge from the vaults, but to little interest.
There were a large number of bags released in the East prior to 1955, but they were not the cause of much interest, as much of the nation was busy collecting cents and lower denominations. Moreover, having never been melted like the Morgan dollar, most saw Peace dollars as common.
In later years, there are only reports of a few bags of the 1926 emerging from the Treasury during the great release of the early 1960s. Even then, the interest was in the Morgan dollars that were appearing. Peace dollars continued to have a reputation as being available, though no one had looked carefully to determine what dates were available and how nice they really were.
Today, the 1926 Peace dollar is priced at $17 in VG-8, actually a small premium. In fact, it could possibly be higher, as we are not certain how many examples of the 1926 there are in lower circulated grades. Remember, it was scarce back in the early 1940s. There does not appear to be a good time when the 1926 would have been in active circulation long enough to reach a grade like VG-8.
There can also be questions in Mint State, where the 1926 lists for $41.50 in MS-60 and $375 in MS-65. Those prices suggest the 1926 has fallen a long way from being the toughest Peace dollar, as it was seen in 1941, but the question may well be whether it has fallen too far.
The grading services total seem to support the current prices, but the question is how nice are the 1926 Peace dollars being called Mint State.
There is no good definition of what is heavily bagmarked and what is only lightly bagmarked, but the claims of the experts regarding the one release of the 1926 are enough to give everyone pause.