Rare nickel fetches $4 million from NJ dealer

[TomG]

Liberty Nickel Sale

[HaydenTubbs]

Holy cow!They're goin to be over $5 million before long!

[BillJones]

Not that I'm ever going to own one, but the 1913 Liberty Nickel is one of my least favorite rarities. It was made illegally by or for a crooked mint employee who profited from his theft.

 

I guess the governemnt most of figured that since it was base metal coin that it was OK to own it. But collectors of other coins have been hastled about items that did not have as checked past.

 

If I owned a 1913 Liberty nickel, I'd sell it so that I could buy some REAL coins.

[TomB]

Hey Bill!

[Hoot]

Not that I'm ever going to own one, but the 1913 Liberty Nickel is one of my least favorite rarities. It was made illegally by or for a crooked mint employee who profited from his theft.

 

I guess the governemnt most of figured that since it was base metal coin that it was OK to own it. But collectors of other coins have been hastled about items that did not have as checked past.

 

If I owned a 1913 Liberty nickel, I'd sell it so that I could buy some REAL coins.

 

Perfect sense!

 

Hoot

[Morgannut]

This was a very smart play but Legend IMHO. It is a better example than the one they sold, and publicity will help show their new emphasis on the ultra expensive market, rather than the high end for the issue market. Just a few new customers in the top of the market will pay for the coin.

 

I have no love for the coin, much like the 1895 Proof Morgan Dollar, just because I can't stand the hype that drives up pricing. But at least it's a nice one, and I don't know, but it could be the Eliasberg example, which would make it very interesting.

[Tradedollarnut]

It is the Eliasberg example - one of only two with full proof surfaces. It has been graded PR66 by both services and is the finest known by two grades.

[EZ_E]

Not that I'm ever going to own one, but the 1913 Liberty Nickel is one of my least favorite rarities. It was made illegally by or for a crooked mint employee who profited from his theft.

 

I guess the governemnt most of figured that since it was base metal coin that it was OK to own it. But collectors of other coins have been hastled about items that did not have as checked past.

 

If I owned a 1913 Liberty nickel, I'd sell it so that I could buy some REAL coins.

 

 

 

Right On! I agree 100%.

[Tradedollarnut]

- wouldn't it be smarter to hold it for a bit and then sell it for an additional $1,000,000?

[Hoot]

- wouldn't it be smarter to hold it for a bit and then sell it for an additional $1,000,000?

 

You've got duck soup on that one TDN.

 

Hoot

[gmarguli]

- wouldn't it be smarter to hold it for a bit and then sell it for an additional $1,000,000?

 

You've got duck soup on that one TDN.

 

Hoot

 

Is that duck soup made with the dead dealer ducks of 1989 who were saying the same things about other coins right before the market came crashing down?

 

Sincerely,

 

Devil's Advocate

[Tradedollarnut]

Yup. BTW - how much did the 1913 go down in 1989?

[chinook]

There was a mention on CNBC today about Legend and the coin.

 

Simply marketing 101.

 

Whether it is a "true" coin or not, there are more wiilling buyers than there are coins.

[Tradedollarnut]

I'll answer my own question to Greg [out of deference to NGC, I won't post the CU graph here, tho]

 

The CU3000 shows the huge 1989 peak quite succinctly - with a 9 fold runup from 1982 to 1989 and a subsequent 75% drop from 1989 to 1994.

 

In 1985, the index was 60,000. In 1993, the index was 60,000. In 1985, the Olsen specimen of the 1913 sold for $385k. In 1993, the same coin sold for $963k. The index stayed the same [returned to the same level after the peak and crash], yet the nickel sold for almost 3 times the previous price realized.

 

Someone better than me at math can figure the annual return on that - doubling in 8 years is about 10% so tripling should be around 15% Not a bad annual return POST CRASH.

[JamminJ]

Someone better than me at math can figure the annual return on that - doubling in 8 years is about 10% so tripling should be around 15% Not a bad annual return POST CRASH.

 

Compounded annual return = (963000./385.000.)**(1./(1993.-1985.)) = 12.14%

[gmarguli]

Someone better than me at math can figure the annual return on that - doubling in 8 years is about 10% so tripling should be around 15% Not a bad annual return POST CRASH.

 

Compounded annual return = (963000./385.000.)**(1./(1993.-1985.)) = 12.14%

 

Did you factor out inflation and the risk free rate of return?

[gmarguli]

I don't doubt that these ultra-rarities will go up in value largely independent of what the overall market does, but I just found the comment "wouldn't it be smarter to hold it for a bit and then sell it for an additional $1,000,000?" funny since it sounds very much like comments I heard 15 years ago. Lots of dealer not wanting to sell now because the market was so hot. Why sell it now for $500, it'll be worth $550 next month. And of course lots of dealers wanting to sell ASAP during this time also.

 

And honestly, when I heard this coin sold for $3M last year, I thought the buyer was buried in it.

[spy88]

I've always been slightly confounded by these 5 nickels. My problem stems from my belief that if it was a mint employee that minted them, why only 5? Was 25 cents that important to him? Or did he know they were or would become so valuable? When the first one showed up, who had it and how did they get it? If illegal, why wasn't it confiscated? A question as well for the others as they emerged.

 

I suppose if I did a little research, I'd be able to find out some of the answers, but it still nags at me that only 5 are known. Were the mints checks and balances, inventory of dies and planchets, security, etc. tight enough to have kept him from minting at least 20 or 100? Ahhhh, I bet there are others out there somewhere---lost or in private collections, sold/bought behind closed doors. Notoriety for owning the 6th or 7th known 1913 nickel would really be the last thing the owner would desire, especially if they had to paper trail their ownership! SHHH!

 

But then---thats never happened before in numismatics, has it.

[Tradedollarnut]

Well, Greg, that's not a comment I would normally make just because of the way it sounds, but I felt compelled to say something snide in response to those who would wish to be done with the coin and on to something else. The fact is that as far back as I can see, each sale of any specimen of the 1913 has met or broken the previous record for the coin in any grade. Past performance in no way guarantees future return, but I am confident in the demographics of this market - I feel there is at least 10 years left in the bull run.

 

And once the PR64 sold for $3M just one year later, his price paid on the PR66 didn't look so bad, now did it?

[Tradedollarnut]

The 1913's were not necessarily minted illegally, but most probably on the sly. There's a distinct difference.

 

Standards of today simply cannot be applied retroactively to the mint of yesteryear.

[JamminJ]

Did you factor out inflation and the risk free rate of return?

 

No need to account for that stuff, that's just money that's no longer there.

[spy88]

However, five 1913 nickels depicting "Miss Liberty" were minted illegally, possibly by a mint official.

 

TDN, this is a statement of fact not conjecture. I'm not saying they know what they're talking about, but taken at face, illegal is illegal. And I'll go further to say that any activity in the actual minting of coins for the express purpose of spiriting them out for ones own use, would of course be on the "sly" but still illegal. I doubt the mint officials of yesteryear and especially today, would consider the distinction valid when meting out punishment for the act.

 

1877--Congress passed an Act prohibiting the counterfeiting of any coin, gold or silver bar. (from the history of the Secret Service)

Is a coin considered counterfeit if made in a US mint by a mint employee but done on the "sly" and for personal profit?

 

JMHO

[Tradedollarnut]

Please prove to me the 1913's were minted illegally. You can't, because it is unknown when and how they were made.

[spy88]

TDN, you know I can't prove it anymore then you cannot. I'm simply going by the link provided and the quote I used from it. However, here is another quote from a rare coin firm were they allude to the production of the 5 coins as not being illegal. So who do you believe (rhetorical question)?

 

The coin is so valuable not only because five exist, but also because its origins are surrounded in mystery.

 

The five nickels are believed to have been produced at the Philadelphia Mint in early 1913 just before the nickel design was about to change from the Liberty Head, produced from 1883 to 1912, to the Indian Head that was minted from 1913 to 1938.

 

Because these coins were struck before the official adoption of the Indian Head design, producing the five Liberty Head coins with a 1913 date was not illegal even though no other Liberty nickels with that date were ever produced. Speculation is that an employee of the Philadelphia Mint struck the five 1913 Liberty Head nickels in January or February of that year. Although not illegal, the production was probably unscrupulous. Samuel W. Brown, a numismatist and an assistant curator of one of the collections in the Philadelphia Mint, definitely was involved, and he eventually produced the nickels.

 

The collector world first learned of the nickels existence in 1919 when Brown advertised in the Numismatist, the coin association’s magazine, offering to buy the rare Liberty Head nickels. By then, he was no longer a Mint employee.

 

Later, Brown made it known that he had five of the coins and took them to the 1920 ANA convention, which was the first time anyone had seen them.

 

Some historians speculate that Brown may have waited until 1919 to disclose the coins’ existence because he wanted to make sure the person who actually struck the coins had died. Others observe that 1920 was the year that the seven-year statute of limitations would have expired for prosecution of anyone removing government property from the Mint. As is the case with so much of the nickel’s history, the real story will probably never be known.

 

Blanchard and Company, Inc.

 

The simple fact that the 5 known examples are still in public and private hands undermines the illegality of them. The government has made no effort to seize them (as the 1933 $20 double eagle) and made no provision for punishment of ownership. As you say, you cannot retroactivate the laws of then to now and I agree. But the technicality of Brown having some roll in their mintage, even if between design changes, was IMO, more then just "unscrupulous".

[Tradedollarnut]

I don't disagree with your current post, I thought the discussion was why does the government not sieze them as they are 'obviously illegal' as evidenced by your statement: TDN, this is a statement of fact not conjecture. I'm not saying they know what they're talking about, but taken at face, illegal is illegal.

 

The fact remains that the exact circumstance of their mintage is unknown. If the government were to try to sieze them, would they not have to prove they are illegal?

 

There is precedence for the number 5 being produced for a rarity on the sly - the 1885 trade dollar. There is also ample precedence for the mint making instant rarities and novelties for sale to collectors.... tons of them!

[cpm9ball]

If the government were to try to sieze them, would they not have to prove they are illegal?

 

On the contrary, the government can seize anything they want, any time they want. It is up to you to prove they are wrong. The IRS, FBI, ATF and DEA do it every day.

 

Chris

[spy88]

I reiterate that my statement was strictly in reference to TomG's link where it unequivocally stated they were "illegal". My personal belief is that were they "illegal", the Secret Service would have considered them as such back in 1919 when Brown first brought them out and confiscated them post haste. If I led you to think my belief was otherwise, I apologize.

 

The fact remains that the exact circumstance of their mintage is unknown. If the government were to try to sieze them, would they not have to prove they are illegal?

 

I agree. However your question is moot as so much time has passed that I think they (the Secret Service who would have jurisdiction) would never attempt to do so this late after the fact. This applies to Chris post also.

[Tradedollarnut]

Agreed.

 

Apparently, the 1965 Coinage act provides for Legal Tender status for all coins previously minted except those the Treasury has decided to challenge. Someone says there's a list and it includes such things as the 1933 $20, the 1964-D Peace $1 and the 1974 Aluminum cent ... but not the 1913 Liberty nickel.

 

Whew!

[Morgannut]

Yep, Miss Daggett is free to buy an icecream cone with her 1892S dime, and TDN can buy her a popsicle too with his 1913 nickel, because coins are now both legal tender as of 1965. I bet Legend will hold on to theirs for awhile though, even though it's summer!!

[EVillageProwler]

That's either a very expensive popsicle or a very cheap one. In any case, morgannut, for a Legend-hater you sure do stalk 'em a lot.