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The 1854-D is Not the Second Rarest Three Dollar Gold

By Greg Reynolds for CoinLink

An 1854-D Three Dollar Gold Coin is ‘in the news’ as the firm of Ira and Larry Goldberg will be offering one at auction in May, just prior to the Long Beach (CA) Coin, Stamp and Collectible Expo. This 1854-D, which I have not seen, has been graded “AU-55” by the Numismatic Guaranty Corp. (NGC).

1854-D $3 MS62 NGC. Heritage Atlanta 2006 - Lot: 1516 Auction: 402The 1854-D is a famous rarity. Three Dollar Gold coins were minted from 1854 to 1889. The rarest date in the series is the unique 1870-S. The only one is in the “Core Collection” of the late Harry Bass, and is on display at the ANA museum in Colorado. I was fortunate to be able to view it when it was part of a short-lived exhibit at the ANS in New York in the late 1980s. It was auctioned for $687,500 at the Eliasberg gold sale in 1982.

Bass had two 1854-D Threes, one was graded “AU-55” by the Professional Coin Grading Service (PCGS). It was auctioned for $25,300 in October 1999.

The other Bass 1854-D remains in the “Core Collection,” and has an amazing strike for this date. The dentils (teeth at the borders) on 1854-D Threes tend to be very mushy in some areas, and the rims are often not well pronounced. The Bass 1854-D has incredible detail and definition for the date. Those who have seen it suggest that it might be the finest known 1854-D? It is understood, though, that striking characteristics are only one factor that is incorporated into a coin’s grade. I have not examined it. It is illustrated at the website of the Harry Bass Foundation.

The 1854-D Three is widely believed to be the second rarest business strike in the series. It is, by a wide margin, the second most expensive business strike, well ahead of the others, in terms of market prices.

Two Three Dollar Gold dates are proof-only issues, as no business strikes were made, 1875 and 1876. They are each rarer than the 1854-D. There are business strikes, in addition to the 1870-S, that are rarer than the 1854-D Three Dollar Gold piece.

I believe that 1873 Threes are rarer than 1854-D Threes? I hypothesize that there are seventy to ninety business strikes, and maybe twenty to twenty-five Proof 1873s, including both ‘Close 3′ and ‘Open 3′ varieties. My estimated total range for the date would thus be 90 to 115. It is almost certain that there are more than 115 1854-D Three Dollar Gold pieces.

In all major price guides, 1854-D Threes are valued much higher than 1873 business strikes. It is often believed that both the demand is greater and the supply is smaller for 1854-D Threes than for all other business strikes in the series, except the unique 1870-S. The supply is believed by many collectors to be smaller, because they frequently get the impression that the 1854-D is the second rarest business strike.

It is certain that the demand is greater. When coins of roughly equivalent grades are compared, 1854-D Threes consistently realize higher prices at auction than all other collectible business strikes in the Three Dollar Gold series.

Why the extra demand? The 1858, the 1865, the 1873, the 1877, the 1881 and the 1886 are all Philadelphia Mint coins. The 1854-D, in contrast, is the only Three Dollar Gold date that was minted in Dahlonega. It is also true that the 1854-O is the only date in the series that was minted in New Orleans. But, there is no doubt that more than twice as many 1854-O Threes are around today. Put differently, all recognized experts are in agreement that 1854-D Three Dollar gold pieces are much rarer than 1854-O Threes.

Much of the demand for 1854-D Threes relates to the special mystique of the Dahlonega Mint. While everyone has heard of Philadelphia, Denver and San Francisco, there are millions of Americans who have never heard of Dahlonega. Even many coin collectors, who see the Dahlonega name in auction catalogues and reference guides, do not know that it is in Georgia. The City of Dahlonega website estimates the number of residents to be “3,700.” If I never became interested in coins, then I might never have heard of the place.

The U.S. Mints at Dahlonega and Charlotte were in operation from 1838 to 1861, and they produced only gold coins. No Three Dollar Gold pieces were minted in Charlotte. There was a ‘gold rush’ in the South long before the California Gold Rush started in 1849.

There have been many collections assembled just of Dahlonega Mint coins. In the PCGS registry, there are separate categories for those who are assembling sets of Dahlonega Mint coins ‘by date’ and ‘by type.’

1854-D $3 MS62 NGC. Heritage Atlanta 2006 - Lot: 1516 Auction: 402The Most famous collection of Dahlonega Mint coinage was part of the ‘Duke’s Creek’ collection. Early in 2004, this collection was purchased privately and submitted to NGC for grading. A short time later, a Texas dealer, not Heritage, ended up with the Dahlonega gold coins. Many (or all?) of the ‘Duke’s Creek’ Dahlonega coins were auctioned by Heritage in 2006.

The ‘Duke’s Creek’ 1854-D Three was graded “MS-62” by NGC in February or March 2004. It was auctioned by Heritage in April 2006, for $149,500! The NGC Registry reports that it was added to the “South Texas Collection” of Three Dollar Gold coins on April 19, 2006. The “South Texas” collector really does live in Texas, or at least operated a business there when I met him. He may not wish for his name to be mentioned.

The ‘South Texas’ collector never really aimed to acquire the finest known examples of all or any dates. He was focused on finding MS-62 to MS-64 grade coins that he liked. His set is, far and away, the finest in the NGC registry. In the PCGS registry, the ‘South Texas Collection’ is way behind the ‘Great Lakes’ collection, which has many gem quality pieces. It is, perhaps, an unfair comparison, as the ‘South Texas’ collector may have never intended to acquire any gem quality Three Dollar Gold pieces.

Before the appearance of the Duke’s Creek piece, the NGC had not awarded a MS-62 or higher grade to an 1854-D, and the PCGS had to only one, the ‘Great Lakes’ 1854-D. At least since early 2003, the ‘Great Lakes’ 1854-D has been the one and only 1854-D to be PCGS graded MS-62.

1854-D $3 MS61 PCGS. Heritage Auction 336 Lot 1037 - 2004, FUNAccording to Douglas Winter, the ‘Great Lakes’ 1854-D was PCGS graded MS-61 when Superior Galleries auctioned it in January 1996 for $74,800. Winter also says that it is the same coin that was sold in Rarcoa’s session of Auction ‘81 for $72,500. This Rarcoa result is itemized by Walter Breen in his encyclopedia, published in 1988. It is the only uncirculated 1854-D that Breen mentions.

In January 2004, Heritage auctioned the ‘Green Pond’ 1854-D for a reported $92,000, to a floor bidder. It is PCGS graded MS-61.

The lone example that is PCGS graded MS-60 was unsuccessfully offered at auction in October 2000, March 2002 and July 2002. Stack’s sold it in 1999 for $52,900, then graded as “AU.” At the time, this was an extremely high price. The reason that it did not sell in subsequent auctions might be because the reserves were unrealistically high. Since 2002, markets for rare date gold have boomed. It is worth much more than $52,900 now.

The ‘Dallas Bank’ 1854-D realized $48,875 in New York in October 2001. Though graded “AU” in the catalogue, it is plausible that the high bidders regarded it as an MS-60 or MS-61 grade coin. Winter said that it was later graded MS-61 by NGC. I have no reason to think otherwise.

The five that the NGC has graded MS-61 probably represent two or three different coins. If, as Winter says, the ‘Great Lakes’ 1854-D was previously PCGS graded MS-61 before it became PCGS graded MS-62, then there might only be a single, currently PCGS graded MS-61 1854-D?

There was an NGC graded MS-60 1854-D in a June 2000 Superior auction, and another has been NGC graded MS-60. In January 1999, Heritage offered an NGC graded MS-61 1854-D. In April 2007, pictures of this coin were not available in the Heritage online archive. Could this possibly be the ‘Duke’s Creek’ 1854-D?

Of those that have been PCGS or NGC graded from MS-60 to -62, it is not clear how many are different coins, probably between five and eight. Curiously, there are a substantial number of 1854-D Threes at the other end of the grading spectrum.

The large number of circulated and problematic 1854-D Threes is fascinating. My guess is that most 1854-D Threes have never been submitted to PCGS or NGC. Some are certified by NCS or ANACS with problems noted on the holders. Others have been certified by non-leading services. Most are probably sold by dealers to buyers who do not know that such coins have serious technical problems. Other buyers know and are glad to pay less than they would have to pay for a PCGS or NGC graded 1854-D. After all, 1854-D Threes are expensive.

An 1854-D in Very Fine grade is likely to have a retail value between $8,000 and $14,000. An Extremely fine grade 1854-D could be worth, at retail, anywhere from $18,000 to $32,000, depending upon eye appeal, pedigree and surface characteristics. An AU 1854-D may sell retail anywhere from $35,000 for a weak AU-50 to more than $57,500 for a ‘high end’ AU-58. A dealer could fairly ask more than $110,000 for a PCGS or NGC graded MS-61 1854-D. Auction prices may be higher or lower than retail prices, though often lower.

An 1854-D with some serious problems may be obtained for less than $10,000. In Nov. 2004, Heritage sold one that ANACS certified as “AU details, net VF” with notations of it having been “repaired” and “polished,” for $6325. In May 2004, Superior auctioned one that was cataloged as “VG-08” and “burnished,” for $4370. In Jan. 2002, Heritage auctioned an 1854-D that ANACS labeled as being “tooled” and “cleaned,” with a net grade of “VG-08,” also for $4370.

Most gold coins from the 1850s circulated until they were too worn to use further, and then they were melted. Why are 1854-D Threes an exception to the rule? Why does ten to twenty percent of the mintage of 1120 survive? Even if this often reported mintage figure is wrong, and it might very well be, it is still puzzling that there are so many worn and problematic 1854-D Threes. The point here is that the ratio of the number that grade below EF-45 (including problem-ridden AU’s) to the number that grade above EF-45 is high for a mid-19th century gold rarity.

The mintmark on 1854-D Threes is especially noticeable. It is a very large ‘D’ that is not far from the ‘year.’ In contrast, a mintmark on a Walking Liberty Half Dollar or on an Indian Head Half Eagle would, typically, only be noticed by people who are knowledgeable about rare coins. It is logical to assume that a large number and a wide range of people noticed the ‘D’ on the 1854 Three, and talked about what it might indicate. Many saved 1854-D Threes. They were often worn as jewelry or mounted for other purposes. There are dozens of 1854-D Threes that have been tooled, soldered, whizzed, banged, harshly cleaned, or polished by people who were not coin experts. They kept such 1854-D Threes as souvenirs, historical artifacts, or decorations.

1865 $3 AU58 PCGS. Photo Courtesy of Heritage AuctionsThree Dollar Gold coins have always been conversation pieces. Most people now have never seen one. Threes dated 1854-D are the only such pieces minted in the ‘Deep South.’ While New Orleans is in the South, New Orleans is usually thought of as a very different culture from that of the ‘Deep South.’ Dahlonega gold coins appealed to people who were (and people who still are) proud of being from the South or from Georgia in particular. The fact that Dahlonega was never really a major city is an additional curiosity factor. From the 1850s to the 1870s, people who had little, if any, interest in rare coins saved 1854-D Threes. Logic suggests that most of these same people did not save Three Dollar gold pieces of other dates.

In January 2004, Douglas Winter estimated that there are 100 to 125 1854-D Threes extant. Auction data, dealer ads and fixed-price lists, and the frequent appearances of examples (especially problematic ones) at coin shows, plus my points above, all suggest that this range is much too low. There are likely to be more than 200, most of which have never even been submitted to PCGS or NGC, and many of which have never been consigned to major auction companies. Mail-order dealers and coin shops all over the nation inventory them more often than experts realize.

Are there several dates in the series that are rarer than the 1854-D? As mentioned above, the total number of 1873s, business strikes and Proofs of both varieties, is likely to be less than the number of surviving 1854-D Threes.

The 1877 Three is almost certainly rarer than the 1854-D, and has never received the attention that it deserves. In the March 2005 ANR catalogue, Q. David Bowers refers to estimates of sixty to one hundred circulated 1877s and seven to eleven uncirculated pieces.

I theorize that forty-five to fifty-five 1877 Threes have been graded by PCGS or NGC. Unlike the 1854-D, the 1877 has little souvenir or jewelry value. There are plenty of Philadelphia Mint Threes of other dates for people to wear. It is also debatable as to what extent $3 gold coins were really circulating in the late 1870s. In general, gold coins circulated more in the West and the South than in the Northeast where people used them as a store of wealth and/or for bullion purposes. Threes of this date that grade below EF-40 may not be nearly as rare as those that grade above MS-60, of which there are around ten. Even so, there are hardly any very worn examples.

Threes dated 1854-D appear at auction more than twice as often as 1877 Threes, even if Proof 1877s are included in the calculations. My impression is that there are sixty-five to eighty business strikes and fifteen to eighteen Proof 1877s, 80 to 98 overall.

Although the PCGS and NGC data show that about one-third more 1865s have been graded than 1877s, a careful examination of the data would suggest that the number of individual coins may be in the same range. One factor is that there are many more 1865 Threes, in relative terms, that plausibly grade above MS-61, and these are the most likely to be resubmitted several times. My guess is that there are thirteen to sixteen Proof 1865s, including ten to twelve different Proofs that have been certified by PCGS or NGC, and three or four that have never been submitted. Including both Proof 1865s and business strikes, probably seventy-five to ninety-one 1865 Threes exist. If I am right that only sixty-two to seventy-five business strikes exist, it could be the rarest business strike in the series, after the unique 1870-S.

The 1881 Three Dollar Gold piece is also very rare. In the March 2005 ANR catalogue, Q. David Bowers, and whoever assisted him, estimated that 100 to 150 business strikes were known. My guess would be 120 business strikes and thirty-five to forty-two Proof 1881s. There is thus a good chance that the 1881 is also rarer than the 1854-D Three.

An 1881 Three in MS-62 grade would retail for less than $15,000, one-tenth as much as the ‘Duke’s Creek’ “MS-62” 1854-D! It is important to note, however, that a MS-62 grade 1881 would not be anywhere near the finest known of that date as there are a half-dozen or more that have been certified as MS-63 or higher.

I have carefully examined many $3 gold coins over the years, and taken extensive notes, particularly regarding proofs. Before I began work on this article, four days ago (April 20), I had not thought much about the relative rarity of the various dates in the series. When I write auction reviews, I am more concerned about how auction results relate to market prices than I am about analyzing the reasons for and logic of prevailing market prices.

In all honesty, I never got around to obtaining or reading the two books that have been written on Three Dollar Gold coins. The book by David Akers came before my time, more than thirty years ago. The other is co-authored by Bowers and Winter. I refer above to an article devoted to 1854-D Threes that Winter wrote in 2004 and to Bowers’ extensive discussions in the March 2005 ANR catalogue. I have written two articles regarding that 2005 auction, one of which was focused upon Three Dollar Gold coins. Both were published in Numismatic News.

In passages above, I explicitly refer to these Winter 2004 and Bowers 2005 sources. My reasoning and conclusions regarding relative rarities, however, are clearly different from theirs.

A primary point is that the popularity and fame of the 1854-D is largely responsible for its value, rather than its rarity. I am stating that there are likely to be more than 200 1854-D Threes, and that the 1865, 1873, 1877 and 1881 are all very likely to be rarer than the 1854-D. Even if there are just 125 1854-D Threes, the 1865, 1873 and 1877 would still be rarer, in my estimation.

As far as I know, I am the only one to conclude that there may be as few as sixty-five 1877s in business strike format. Its rarity is very much unrecognized. The attention that the 1854-D receives in the coin related media and literature may lessen over time. Is it overvalued from a logical perspective, especially in contrast to these other dates in the same series? Although the 1854-D is the second most valuable business strike in the series, it may be the fifth or sixth rarest!

© 2007 Greg Reynolds

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About the Author

Greg Reynolds is a numismatic writer, researcher and analyst. Greg has examined almost all of the greatest U.S. coins and most of the finest type coins and patterns, He has extensively researched the pedigrees of important numismatic properties, and he has written about and analyzed numerous auctions, private sales and collections.

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