Classic head gold

[stinkycheese1]

Well I just did a search on the forums for (I think) I remember making a thread on why classic head gold is so expensive before, but I couldn't find it. My apologies...

 

Why is classic head gold so expensive anyway? I bought a AU53 classic head $2.50 1834 gold coin from mark, and it's not even a rare coin, yet it cost me $1200. And that's not even in an uncirculated grade! Classic head gold generally isn't considered "early" gold, and it seems to be under collected, so demand seems to be low, but I don't understand what drives the price up so much. A good XF costs around $600-$700. An MS will cost you around $4000.

 

The classic head design had more mintages of the last series before it combined, and the capped head bust design before it was bigger, higher karat, and when the price of gold exceeded the face value people would melt down these early coins, but not on classic head gold. So that's why they reduced the purity of the gold from 91% to 89% gold, so people wouldn't melt them down, they also slightly reduced the size.

 

I hope that tidbit of history is a bit interesting. I found it out by reading from some books. Also they got the gold from recent discoveries in north carolina and georga, to make classic head gold coins.

 

[BillJones]

One overall answer to your question is that EVERYTHING that has any scarcity at all is expensive these days. Back in the late 1980s I bought a 1793 Chain Cent in Fine for around $3,500. Today that coin is in a VF-30 holder and it’s worth almost 10 times that much. That huge increase occurred over the last five years or so. For the first 15 years that I owned that coin the price increases were small to moderate.

 

A second answer concerns the way that the Classic Head gold coins were used. The Classic head pieces were the first gold coins that saw a lot of circulation. The reason was that their gold content was more in line with the value of the dollar than the previous gold coins had been. As a result strictly Mint State $2.50 gold pieces are quite scarce and strict Mint State $5.00 Classic Head coins are almost what I would call “rare.” I don’t throw the term “rare” around loosely. I’ve found that if you really want to get a Classic Head $5.00 in what I what I would call strict Mint State, you will have buy an MS-64 or higher graded piece.

 

The $2.50 and $5.00 gold pieces in my collection are graded MS-62 and MS-61 respectively. I don’t consider either of them to be strictly Mint State. When I bought the $2.50 in 1970 for $150.00 the dealer from whom I purchased it called it “virtually Unc.” Back then you could buy a Choice Mint State (MS-64) Liberty $5 coin for less than $100.00. The $5.00 was graded MS-61, but I see it as an AU-58.

 

Finally while the Classic Head mintages might seem high, in the context of things, they aren’t really that high. The highest annual mintage for both $2.50 and $5.00 coins is around 550,000 coins. All of the other mintages are lower. When you compare that to coins like an 1877 Indian (a little over 800,000) or a 1909-S-VDB cent (450,000) you start to see that the mintages were not large. And then you have to subtract the coins that have been melted over the years.

 

So in the end, the Classic Head gold is not “common,” especially in the grades from Choice AU to Mint State. Like everything else you have to view the market for these coins in context. If they were as popular as the coins that go into the eight and twelve piece gold type sets, their prices would much higher. In that sense they almost seem like “bargains.”

 

I hope this helps to understand a bit about the market and the supply of these coins.

 

[stinkycheese1]

Wow Bill, that really helped. Thanks!

 

PS: There's no classic head slot for the 8 and 12 piece gold type set?

Also, were these classic head gold coins exempt from melting during the 1933 when president roosevelt ordered all melting of coins, since they have numismatic value?

 

Also, although they aren't rare, would you consider classic head gold "scarce"?

 

[BillJones]

There's no classic head slot for the 8 and 12 piece gold type set?

 

No.

 

Here is the list of eight and twelve piece type coins:

 

Eight Piece:

 

$2.50, Liberty Head and Indian types

$5.00, Liberty Head with motto and Indian types

$10.00 Liberty Head with motto and Indian with motto types

$20.00 Liberty head, type 3, St. Gaudens with or without motto

 

Twelve Piece:

 

ADD:

 

One Dollar gold pieces; Type 1, Type 2 and Type 3

 

Three Dollar gold piece

 

were these classic head gold coins exempt from melting during the 1933 when president roosevelt ordered all melting of coins, since they have numismatic value?

 

FDR called ALL gold coins in. The exceptions were coins that were to be held in collections. There was also, for some reason, restrictions on the number of $2.50 gold coins that could be held of any one date. Despite the fact that the Classic Head coins were almost a century old, they were part of the Gold Surrender Order. It's hard to say how many might have been turned in. Probably not too many.

 

Also, although they aren't rare, would you consider classic head gold "scarce"?

 

If you include all of the low grade pieces in VF and Fine, I would not say that they are "scarce.' At a Baltimore show a year and a half ago, Heritage had over 200 certified pieces of the quarter and half eagle for sale. At one of the FUN shows, one dealer had over case full of Classic Head gold, and the coins were three and four deep. No you don't see as many of them as you do the later types, but the coins are available. It's really only in strict MInt State where the type coins get scarce.

[MarkFeld]

Kevin, here are a couple other things to consider:

 

1) In the case of the Classic Head Quarter Eagles and Half Eagles, they were only produced from 1834-1839 and 1834-1838 respectively. And in each series, the mint-marked pieces (dated 1838 and 1839) are even more costly than the common date P-mint issues. Compare that to Liberty Head gold coins of those denominations, which were made from 1840-1907 for the Quarter Eagles and 1839-1908 for the Half Eagles. So on a relative basis, there are far fewer Classic Head examples.

 

2) You mentioned "early gold" - the Capped Bust type which preceded the Classic Head design is much scarcer, but also much more costly, typically selling for multiples of the price that Classic Head gold does. As just one example, the least expensive Capped Bust Quarter Eagles list at $10,000 in AU50 in the CDN, compared to $1100 for the 1834 Classic Head.

[Desert Gold]

One overall answer to your question is that EVERYTHING that has any scarcity at all is expensive these days. Back in the late 1980s I bought a 1793 Chain Cent in Fine for around $3,500. Today that coin is in a VF-30 holder and it’s worth almost 10 times that much. That huge increase occurred over the last five years or so. For the first 15 years that I owned that coin the price increases were small to moderate.

 

 

What happens to the NGC registry points when a coin's price and popularity go up 10 fold? Does NGC also raise the scores for such coins, or were the coin scores set up a long time ago and they stay pretty much the same over time?

[BillJones]

What happens to the NGC registry points when a coin's price and popularity go up 10 fold? Does NGC also raise the scores for such coins, or were the coin scores set up a long time ago and they stay pretty much the same over time?

 

The short answer to that one is nothing. I purchased one very rare type coin (1808 $2.50 gold in PCGS AU-50, green label) for a considerable amount of money. Recently to get my non gold type to 99% complete, a goal I would like to achieve before the end of year, I purchased a 2006-S silver Proof JFK half dollar in PR-68 Ultra Cam for $30. On a dollar for dollar basis I got FAR FAR more points for that modern Proof coin that what I get for a classic rare coin like a Chain Cent or 1796 quarter in VF-25 or 30. In short the guys who buy high grade modern and 20th century coins get a lot more points for a lot less money than I do for my solid collector grade hard to find, and now very expensive classic coins.

 

To me the point system is very unfair so I spend my time trying to get 100% complete. There should be reward for that, but there isn't.

[jtryka]

Weren't most classic head coins melted long before the gold recall of 1933? I thought that since their gold content was slightly lower than the subsequent Liberty issues, but I could be mistaken.

[PerryHall]

Weren't most classic head coins melted long before the gold recall of 1933? I thought that since their gold content was slightly lower than the subsequent Liberty issues, but I could be mistaken.

 

The gold content of Classic head coins was actually lower than previous pre1834 gold coins. Later, Liberty head gold coins had the same gold content but the fineness was raised to .900.

[BillJones]

Weren't most classic head coins melted long before the gold recall of 1933? I thought that since their gold content was slightly lower than the subsequent Liberty issues, but I could be mistaken.

 

Without a doubt most of the Classic Head gold melt occurred before the 1933 Gold Surrender Order due to normal attrition. Still, some of those coins undoubtedly went into the melting pot in 1933 because many Americans were very loyal and wanted to obey the law. My mother told me that her parents and everyone else she knew turned their gold coins in for the cause. Among those coins that were turned in there had to have been a tiny percentage of these near century old pieces.