Silver Eagles repeat Morgan dollar history

Are there too many silver American Eagle bullion coins?

If that seems like an idiotic question, bear with me for a few minutes.

Collectors my age and older remember the millions of old silver dollars backed up in Treasury vaults.

We watched their eventual release and even participated in the General Services Administration sales of the last of them in the 1970s and early 1980s.

The backed-up supply of silver dollars did not happen overnight.

The Treasury produced them and accumulated them over many years - 1878-1904 to be precise.

In that 26-year period, the Treasury acquired an excess supply of hundreds of millions of coins.

The surplus was so large that 270 million of them stored in Treasury vaults could be melted in 1918 under terms of the Pittman Act.

The silver was shipped to British India to stabilize its currency and economy during World War I.

The 1921 Morgan dollar issue and the entire production of Peace silver dollars 1921-1928 were made simply to replace coins that had been melted.

Our silver American Eagle has been produced now for much longer than the Morgan dollar series, 32 years compared to 26.

Annual mintages of the silver Eagle are falling as was the case with Morgans before production was suspended after 1904.

Morgan output by 1904 was approximately 589 million pieces.

So far, the U.S. Mint has struck about 477 million of the bullion silver Eagles.

I am not counting the additional millions that have been made as proofs and “W” uncirculated pieces sold exclusively to collectors.

Perhaps I should.

My point can be made with just the bullion version.

Production is falling year by year now.

Last year, just over 18 million pieces were struck.

This sounds like a lot, but just two years before, 47 million came off production lines.

So far this year, roughly 6.4 million coins have been struck.

In May, only 380,000 have been sold (with one day to go for the month).

At the present pace, mintage of 2018 silver American Eagle bullion coins will reach only 15 million.

As total mintage of the silver Eagle gets closer and closer to the 589 million total number of Morgans struck by 1904, will production continue to fall?

Is the bullion coin market now approaching saturation as the supply of Morgans reached saturation in 1904?

You have time to think about this.

Saturation won’t happen by tomorrow.

But as a flag, you might wonder how many Morgans were struck in 1904 before the plug was pulled: 8.8 million.

We aren’t there yet.

But should production fall to that number, will the Treasury decide to issue paper money backed by the silver American Eagle as was the case with Morgans over a century ago?

There are worse ideas.

Buzz blogger Dave Harper won the Numismatic Literary Guild Award for Best Blog for the third time in 2017 . He is editor of the weekly newspaper "Numismatic News."

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