Roger Burdette's Saint Gaudens Double Eagles Book 4 4

[GoldFinger1969]

On 10/21/2023 at 8:52 PM, RWB said:

I've been told of several large accumulations of dollar bags from the 1960s. The dealers and speculators cherrypicked what they got from Treasury, then refilled and returned the bags. Treasury had to open and count every returned bag, re-label it with the contents, fill, crimp/tie and seal. The Federal Reserve preferred using their own labeled bags and separate tag accounting system, so some US Mint bags were discarded. Several million dollars were removed from rotting bags in the mid-late 1890s at Philadelphia and put into wooden boxes. These were evidently the first to go in 1918.

DE and other gold coin bags were usually burned and gold dust recovered from the ashes. The Swiss were very careful to give each bag of gold a good, hearty shake before opening and consolidating the coins into $25,000 European bank standard bags. Swiss banks sold the coins as if they were always 100% full weight - which they usually were not, at least in bulk. Swiss and Swedish bankers also realized long ago that British sovereigns were not really uniform in weight, so they reweighed everything they got. The legal but light coins were passed on to others; heavy and overweight lots were melted and sold as bullion bars, thereby capturing extra profit on the excess gold from overweight coins.

(I recall there's a little about this in the SG-DE book -- I think....)

Excellent information....I will re-hit the book to see more about bags...but so far, a word search only shows that it was customary for gold sent to Brazil and Argenina to remain in the bags.

[RWB]

On 10/21/2023 at 8:52 PM, RWB said:

Treasury had to open and count every returned bag,

PS: Treasury and Fed Reserve used counting machines, which might have injured many of the coins. (The US. Mints used counting boards well into the 1920s.)

[GoldFinger1969]

On 10/22/2023 at 12:53 PM, RWB said:

PS: Treasury and Fed Reserve used counting machines, which might have injured many of the coins. (The US. Mints used counting boards well into the 1920s.)

Huh ?   I don't recall reading about that in your book or anywhere else.  I assumed it was done manually.

So they'd take 250 coins out of the bag....count them using a machine....and then re-bag them ?  I would guess the machines or even a counting "board" could add dings or marks to a soft gold coin.

I guess they couldn't weight them, not accurate enough or you'd need to weigh multiple bags and then account for the weight of the bags themselves.

Edited October 22, 2023 by GoldFinger1969

[zadok]

On 10/22/2023 at 1:23 PM, GoldFinger1969 said:

Huh ?   I don't recall reading about that in your book or anywhere else.  I assumed it was done manually.

So they'd take 250 coins out of the bag....count them using a machine....and then re-bag them ?  I would guess the machines or even a counting "board" could add dings or marks to a soft gold coin.

I guess they couldn't weight them, not accurate enough or you'd need to weigh multiple bags and then account for the weight of the bags themselves.

...there r photographs from the late '20s showing gold coins still being counted by hand n weighed if necessary....

[zadok]

[zadok]

...the above photo was taken at the philadelphia mint those r $2.50 quarter eagles....

[GoldFinger1969]

On 10/22/2023 at 2:31 PM, zadok said:

...the above photo was taken at the philadelphia mint those r $2.50 quarter eagles....

Is that a counting "board" or machine...or the end of the conveyor belt where the eagles roll off? 

[zadok]

On 10/22/2023 at 4:48 PM, GoldFinger1969 said:

Is that a counting "board" or machine...or the end of the conveyor belt where the eagles roll off? 

...there was a hopper above n another employee putting coins in hopper, individual was inspecting coins, im sure they knew exactly how many were there to start with, it was as always a two person task....

[RWB]

"Inspection" and "counting" were separate tasks. Look in From Mine to Mint for counting board info and photos. The Mints refused to use counting machines because the said the machines marred coins and made the Mint's work look inferior.

(A few posts above, I was referring to silver dollars in relation to the bag question. As a certain member demonstrates, finding a photo and understanding what is shown are not the same.)

Edited October 23, 2023 by RWB

[zadok]

On 10/23/2023 at 11:15 AM, RWB said:

"Inspection" and "counting" were separate tasks. Look in From Mine to Mint for counting board info and photos. The Mints refused to use counting machines because the said the machines marred coins and mad the Mint's work look inferior.

(A few posts above, I was referring to silver dollars in relation to the bag question. As member "zadok" demonstrates, finding a photo and understanding what is shown are not the same.)

...member Zadok stands by previous statement, individuals were "inspecting" coins in provided photo as annotated at time photo was taken...photo illustrated from private archives....

[GoldFinger1969]

1920's Gold Exports:  It's fascinating to own some coins from this era....to read about them....and have it linked to something we all learned about in junior high school, namely the Dawes Plan to help get Germany (and Europe) back on their feet.

To think that something I read about all the time in the inter-war period was a key reason so many of the Saint-Gaudens coins survived the 1930's melting is kind of cool and fascinating. 

[GoldFinger1969]

On 10/31/2023 at 11:52 AM, GoldFinger1969 said:

1920's Gold Exports:  It's fascinating to own some coins from this era....to read about them....and have it linked to something we all learned about in junior high school, namely the Dawes Plan to help get Germany (and Europe) back on their feet.

To think that something I read about all the time in the inter-war period was a key reason so many of the Saint-Gaudens coins survived the 1930's melting is kind of cool and fascinating. 

Conversely...once the Stock Market crashed....economies fell....and the gold standard was targeted and then exited.....this explains why the 1929 Saint is pretty much the last of The Fab Five (1929, 1930-S, 1931, 1931-D, and 1932) to be exported in any quantity such that some mini-hoards could be found in Europe.  All the others are just stray foreign finds or domestic coins only.

As RWB wrote in his book:  "Out of 4,666,000 double eagles, worth $93,320,000, manufactured from 1930 through 1933, not one coin was released to a Federal Reserve Bank for ordinary circulation or international trade."

Edited November 6, 2023 by GoldFinger1969

[kreedteo]

I'm curious - what was the main reason for the gold standard to be abandoned around the time of the Stock Market Crash? I am reading a lot of books and literature about economics, but this book seems to me a special one. I have to do a few assignments based on it for my homework and I am lucky that https://ca.papersowl.com/ is the best essay writing service that I trust and get help from. So I am sure I will manage to do a complex and structured text for my academic task, but it is anyway an interesting content... Not every student will get it.

Edited November 29, 2023 by kreedteo

[RWB]

Economic expansion and innovation required increasingly large investments (and similar returns). A fixed-value asset/standard could no longer be used, Such a fixed system required constant revaluation of the standard, which made the "standard" obsolete. A little like "gradeflation" on steroids. By 1896 there was considerable speculation that a fixed price for gold could not be maintained.

[GoldFinger1969]

On 11/14/2023 at 8:46 AM, RWB said:

Economic expansion and innovation required increasingly large investments (and similar returns). A fixed-value asset/standard could no longer be used, Such a fixed system required constant revaluation of the standard, which made the "standard" obsolete. A little like "gradeflation" on steroids. By 1896 there was considerable speculation that a fixed price for gold could not be maintained.

The "panics" continued and without a central bank until the FRB/1913, any adjustment of wages and prices required an INTERNAL devaluation which mandated loss of output (GDP) and falling prices (bad for farmers, 1/2 the population).  EXTERNAL devaluations (falling currency, inflation, tariffs or subsidies) are easier to live under.

Just look at the recent UAW and Teamster strikes. 

[GoldFinger1969]

RWB, do you have a copy of the 1945 memo from Coiner Bartholomew to Helen Moore ?  If you do, please post it.  

I have the reference to it but have never seen the memo, unlike the one regarding striking of the 1933's on March 2nd.

[GoldFinger1969]

On 11/14/2023 at 4:35 AM, kreedteo said:

I'm curious - what was the main reason for the gold standard to be abandoned around the time of the Stock Market Crash?

A gold standard is like a brake on monetary policy and if you want to cut interest rates, inflate the money supply, or devalue your currency...a gold -linked currency is a hindrance.  As the economic slump deepened in 1930-32, that is when countries left the gold standard, most notably the U.K. in 1931.

You can see how many countries were on a gold standard by this chart.

[GoldFinger1969]

Coinage Act Of 1965:  Anybody an expert on this law ?  It seems to have been passed to legalize demonetized Trade Dollars.  Why was it needed ?

Also has some impact or relevance to the 1933 Saints. 

[RWB]

Do you refer to this section?

SEC. 102. All coins and currencies of the United States (including
Federal Reserve notes and circulating notes of Federal Reserve banks
and national banking associations), regardless of when coined or
issued, shall be legal tender for all debts, public and private, public
charges, taxes, duties, and dues.
 

That allows all obsolete coins and currency to be included in counterfeiting statutes.

[Henri Charriere]

But, but... who in their right mind would turn down coins that have bullion as well as numismatic value?  And then, next thing you know, silver certificates regardless of denomination were declared no longer redeemable in silver, circa 1967.

That section, 102, states, in pertinent part: "All coins and currencies of the United States....shall be legal tender..."  Where does counterfeiting fit into all this?  Were not anti-counterfeiting statutes on the books since the days of the colonies? Or am I missing something?

[dcarr]

On 11/14/2023 at 2:35 AM, kreedteo said:

I'm curious - what was the main reason for the gold standard to be abandoned around the time of the Stock Market Crash?

From about 1900 to 1933, the gold standard was massively cheated upon. Most of that cheating occurred during the "Roaring Twenties" when a lot of paper money creation and expanding credit lead to a lot of economic activity.

It got to the point that there was not nearly enough gold to sufficiently back all the gold-clause currency and bonds.

In 1933 When Roosevelt confiscated gold, the United States Treasury held about 6,000 metric tons of gold and the Federal Reserve had none of its own gold (other than some coins on deposit). From 1913-1933 the US Treasury issued Gold Certificates amounting to 16,000 metric tons of gold. And during the same time, the Federal Reserve bank issued gold-clause Federal Reserve Notes amounting to 54,000 metric tons of gold. And this does not even include the outstanding US Treasury Bonds that were payable in gold. Add to that all the gold-clause corporate bonds, and it is apparent that the Gold Standard had already been abandoned years earlier. It appears that entities in Europe were aware of the developing situation, and that is one reason why a lot of US gold coins were accumulated by European entities.

Here is some more details:

FDR’s 1933 Gold Confiscation was a Bailout of the Federal Reserve Bank

 

.

 

Edited November 23, 2023 by dcarr

[zadok]

On 11/22/2023 at 9:21 PM, Henri Charriere said:

But, but... who in their right mind would turn down coins that have bullion as well as numismatic value?  And then, next thing you know, silver certificates regardless of denomination were declared no longer redeemable in silver, circa 1967.

That section, 102, states, in pertinent part: "All coins and currencies of the United States....shall be legal tender..."  Where does counterfeiting fit into all this?  Were not anti-counterfeiting statutes on the books since the days of the colonies? Or am I missing something?

...its irrelevant...u can go to sleep now n not worry...much of whats posted here is of no consequence....

[RWB]

On 11/22/2023 at 9:21 PM, Henri Charriere said:

Or am I missing something?

The clause insured that a non-legal tender argument could not be made. It also confirmed that merely because a coin or paper currency was not current, it never lost its legal tender status.

Edited November 23, 2023 by RWB

[GoldFinger1969]

On 11/23/2023 at 2:08 AM, dcarr said:

From about 1900 to 1933, the gold standard was massively cheated upon. Most of that cheating occurred during the "Roaring Twenties" when a lot of paper money creation and expanding credit lead to a lot of economic activity.

I haven't seen evidence of that, if anything, new scholarship shows that countries were "too tight" monetarily.  

Can you really "cheat" on something which is not a signed, written contract ?  I'm not sure.   The "rules of the game" require everyone to observe the game the same way and buy or sell gold as needed.  Mercantalistic needs -- the desire to have large gold reserves or hoard it -- would therefore be at cross roads to easier monetary policy and economic growth.  The old "Bankers vs. Farmers" debate except played out internationally.

On 11/23/2023 at 2:08 AM, dcarr said:

It got to the point that there was not nearly enough gold to sufficiently back all the gold-clause currency and bonds.

Again, I'm not sure that really matters and I asked Robert Mundell, the father of the modern gold standards and Euro, about that once at a symposium. 

What matters is that everyone plays the game and agrees to the rules....you don't need every gold contract or Gold Certificate backed by gold anymore than a bank needs to be able to redeem every deposit at any given time.

It DOES pose a POTENTIAL problem but only in theory.  Most gold standard advocates would say that it's not the STOCK of gold and past monetary printing that matters, but the current FLOW and future monetary policy.  Flow....not stock.

On 11/23/2023 at 2:08 AM, dcarr said:

In 1933 When Roosevelt confiscated gold, the United States Treasury held about 6,000 metric tons of gold and the Federal Reserve had none of its own gold (other than some coins on deposit). From 1913-1933 the US Treasury issued Gold Certificates amounting to 16,000 metric tons of gold. And during the same time, the Federal Reserve bank issued gold-clause Federal Reserve Notes amounting to 54,000 metric tons of gold. And this does not even include the outstanding US Treasury Bonds that were payable in gold. Add to that all the gold-clause corporate bonds, and it is apparent that the Gold Standard had already been abandoned years earlier. It appears that entities in Europe were aware of the developing situation, and that is one reason why a lot of US gold coins were accumulated by European entities.  Here is some more details: FDR’s 1933 Gold Confiscation was a Bailout of the Federal Reserve Bank 

We've discussed this elsewhere, but there was no "bailout" of the Fed which could in theory print its way out of any constraints (subject to the political arena pre-1951's Treasury-Fed Accord).

Treasury Bonds could be paid back in gold but often were paid back in new bonds because the price index hadn't moved.  The option was the key; this was the central feature of The Gold Clause Cases.

Europeans wanted American coins because they trusted our coins for content and quality and also many times their own countries would not supply them (i.e., France in the late-1920's).  It had nothing to do with abandoning the gold standard which was also run by the UK.  If anything, they feared currency debasement by their own countries not the U.S., inflation, or war.

Remember....a gold standard, like a global reserve currency, requires the dominant economic power (the U.S in each case) to print MORE MONEY than would normally be the case...to run TRADE DEFICITS and also CAPITAL ACCOUNT SURPLUSES.  That means surrendering monetary policy to follow "the rules" of the game.  With everyone else going off the gold standard, FDR decided he wanted out, too, in 1933 (see chart above on this page).

In the late-1960's, with the Great Society and Vietnam both wanting $$$, the pressure for the U.S. was to either lose gold by printing too much money OR keep the gold here with higher interest rates and endure slower GDP growth and/or a recession.  Mercantilistic thinking -- or good old fashioned hoarding instincts -- made it such that countries hated to bleed gold out of the country even if it meant faster GDP growth.  What they really wanted of course was to keep their gold and have a 100% fiat currency unshackled from precious metals restraints.

Nixon of course "quit the game" in August 1971. He wasn't going to bleed Fort Knox to win re-election in 1972.  

You should read here, DC, it will clear up many misconceptions you have about The Fed:

https://www.federalreservehistory.org/essays/treasury-fed-accord

 

 

Edited November 24, 2023 by GoldFinger1969

[GoldFinger1969]

Dcarr, that website link for the Fed "bailout" is inaccessible....full of spyware and other no-nos, do you have a safer link ?

[GoldFinger1969]

There was lots of good stuff written about the failure of the gold standard about 30 years ago for anybody who wants to read up on it (be prepared to pay up, most of the academic articles and/or books aren't free ).  Barry Eichengreen did lots of good work as did Robert Mundell from a more theoretical perspective.  For numerous reasons -- including some political (i.e., the situation in Germany) -- the gold standard NEVER worked as well in the interwar period as it did in the period before WW I:

"...(there was a) decline in its (the gold standard's) credibility and in international cooperation over it, in comparison with the prewar era. Britain joined the USA on the gold standard in April 1925, and by the end of that year, nearly three dozen countries had effectively restored convertibility; the French franc was stabilized de facto in 1926, the Italian lira in 1927, and by the beginning of 1928, the reconstruction of the gold standard system was essentially complete.

However, from the outset, it was apparent that the new gold standard was not having the beneficial effects so widely envisaged; the most glaring problem was its failure to maintain price stability, and the adjustment mechanism did not succeed in swiftly eliminating balance‐of‐payments surpluses and deficits. The obvious solution was international cooperation, but the requisite level was not forthcoming...."

Edited November 24, 2023 by GoldFinger1969

[GoldFinger1969]

The Rooster Crows:  Interesting fact I came across while reading about gold and foreign/domestic policies in the 1920's and 1930's:

"...On June 25, 1928, when the franc was legally stabilized, the gold reserve of the Bank of France was 29 billions of francs. On October 28, 1932, the gold reserve of the Bank was 83 billion." 

Seems like it wasn't the French citizenry hoarding gold, but the BoF !!! 

[dcarr]

On 11/23/2023 at 11:31 PM, GoldFinger1969 said:

Dcarr, that website link for the Fed "bailout" is inaccessible....full of spyware and other no-nos, do you have a safer link ?

It is my article and website. I wrote it. It is not "full of spyware" or "no-nos". Maybe the website certificate has expired or is invalid or something. Nobody else has reported any accessibility issues with it.

Here is the article as screen-capture images (click on the first image to see larger and then cycle through to see them all):

Edited November 27, 2023 by dcarr

[dcarr]

On 11/23/2023 at 11:27 PM, GoldFinger1969 said:

I haven't seen evidence of that, if anything, new scholarship shows that countries were "too tight" monetarily.  

Can you really "cheat" on something which is not a signed, written contract ?  I'm not sure.   The "rules of the game" require everyone to observe the game the same way and buy or sell gold as needed.  Mercantalistic needs -- the desire to have large gold reserves or hoard it -- would therefore be at cross roads to easier monetary policy and economic growth.  The old "Bankers vs. Farmers" debate except played out internationally.

Again, I'm not sure that really matters and I asked Robert Mundell, the father of the modern gold standards and Euro, about that once at a symposium. 

What matters is that everyone plays the game and agrees to the rules....you don't need every gold contract or Gold Certificate backed by gold anymore than a bank needs to be able to redeem every deposit at any given time.

It DOES pose a POTENTIAL problem but only in theory.  Most gold standard advocates would say that it's not the STOCK of gold and past monetary printing that matters, but the current FLOW and future monetary policy.  Flow....not stock.

We've discussed this elsewhere, but there was no "bailout" of the Fed which could in theory print its way out of any constraints (subject to the political arena pre-1951's Treasury-Fed Accord).

Treasury Bonds could be paid back in gold but often were paid back in new bonds because the price index hadn't moved.  The option was the key; this was the central feature of The Gold Clause Cases.

Europeans wanted American coins because they trusted our coins for content and quality and also many times their own countries would not supply them (i.e., France in the late-1920's).  It had nothing to do with abandoning the gold standard which was also run by the UK.  If anything, they feared currency debasement by their own countries not the U.S., inflation, or war.

Remember....a gold standard, like a global reserve currency, requires the dominant economic power (the U.S in each case) to print MORE MONEY than would normally be the case...to run TRADE DEFICITS and also CAPITAL ACCOUNT SURPLUSES.  That means surrendering monetary policy to follow "the rules" of the game.  With everyone else going off the gold standard, FDR decided he wanted out, too, in 1933 (see chart above on this page).

In the late-1960's, with the Great Society and Vietnam both wanting $$$, the pressure for the U.S. was to either lose gold by printing too much money OR keep the gold here with higher interest rates and endure slower GDP growth and/or a recession.  Mercantilistic thinking -- or good old fashioned hoarding instincts -- made it such that countries hated to bleed gold out of the country even if it meant faster GDP growth.  What they really wanted of course was to keep their gold and have a 100% fiat currency unshackled from precious metals restraints.

Nixon of course "quit the game" in August 1971. He wasn't going to bleed Fort Knox to win re-election in 1972.  

You should read here, DC, it will clear up many misconceptions you have about The Fed:

https://www.federalreservehistory.org/essays/treasury-fed-accord

 

 

>>> I haven't seen evidence of that ...

Then look at it.

>>> new scholarship shows that countries were "too tight" monetarily.  

Do you really think that the "Roaring Twenties" was the result of a "too tight" monetary policy ?

>>> It DOES pose a POTENTIAL problem but only in theory.

Do you think that the Great Depression was/is only a "theory" ?

>>> We've discussed this elsewhere, but there was no "bailout" of the Fed which could in theory print its way out of any constraints ...

Yes, the FED could "print" itself out of insolvency, but only by cheating on the Gold Standard even more than they already had. So the barriers imposed by the Gold Standard were removed in 1933, so as to relieve the FED of all their gold obligations and to allow the FED to print more currency.

Here are the brief facts:

In 1933 the US Treasury held about 6,000 metric tons of gold reserves. The Federal Reserve had very little.

From about 1906-1933, the US Treasury issued Gold Certificates which were paper claims on 16,000 metric tons of gold.

From 1913-1933, the Federal Reserve issued gold-clause notes which were paper claims on 54,000 metric tons of gold.

So that is 70,000 metric tons of gold promised, but only 6,000 on hand.

And this this does not include all the Treasury Bonds that were sold prior to April 1933 and redeemable in gold.

>>> You should read here, DC, it will clear up many misconceptions you have about The Fed: https://www.federalreservehistory.org/essays/treasury-fed-accord

The 1951 Treasury-FED Accord has very little to do with the FED making massive gold promises during 1913-1933. Promises that they would never be able to honor.

 

Edited November 27, 2023 by dcarr

[dcarr]

On 11/26/2023 at 12:19 PM, GoldFinger1969 said:

The Rooster Crows:  Interesting fact I came across while reading about gold and foreign/domestic policies in the 1920's and 1930's:

"...On June 25, 1928, when the franc was legally stabilized, the gold reserve of the Bank of France was 29 billions of francs. On October 28, 1932, the gold reserve of the Bank was 83 billion." 

Seems like it wasn't the French citizenry hoarding gold, but the BoF !!! 

The last 20-Francs gold coins were minted in 1914, and they contained about the same gold content as the rare 100-Francs gold coins of 1929-1936.

So at some point between 1914 and 1929 the French Franc was devalued in terms of gold to 1/5th of what it was.

Edited November 27, 2023 by dcarr