The Market for and Rarity of 1854-O Double Eagles
By Greg Reynolds for CoinLink
During one of the auctions preceding the recent ANA convention, an 1854-O Double Eagle ($20 gold coin) sold for a record $494,500. Bowers and Merena (California), a division of Spectrum Numismatics, auctioned this 1854-O along with a wide variety of other U.S. coins on August 4. Herein, I will discuss the supply and demand of 1854-O Double Eagles, and I will put forth my findings regarding the pedigrees (ownership histories) of three of them.
The ‘O’ mintmark on the reverse (back of the coin) stands for New Orleans. All New Orleans Mint Double Eagles struck from 1854 to 1861 are very rare. The 1856-O is probably the rarest, and the 1854-O is the second rarest New Orleans Mint Double Eagle ($20 gold coin). Aside from an 1861 Philadelphia issue with a stylistically different reverse die, the 1854-O and the 1856-O are the two rarest business strike Liberty Head Double Eagles (1850-1907).
Back in March, this same auction firm, Bowers and Merena, auctioned an 1856-O Double Eagle for $356,500. It was from the collection of the late Jack Bains. That was the last time that an 1856-O has sold at auction.
This 1854-O and the Bains 1856-O are both certified, graded and encapsulated by the Professional Coin Grading Service. The PCGS and the Numismatic Guaranty Corp. (NGC) are the two leading grading services. This 1854-O is PCGS graded AU-55 and the Bains 1856-O is graded AU-53.
In my CoinLink article on 1856-O Double Eagles, which was published just prior to the sale of the Bains piece, I estimated that fifteen or sixteen 1856-O Double Eagles exist. The 1854-O is not as rare as the 1856-O.
There are no 1854-O Double Eagles that grade MS-60 or higher. Many of those that currently grade AU were previously thought to grade Extremely Fine, when standards were stricter. There are four AU grades 50, 53, 55 and 58.
The PCGS reports grading two as AU-53 and three as AU-55, including the one that just sold. The NGC reports twelve that grade from AU-53 to AU-58, plus four in the EF-45 to AU-50 range. It is likely that the 29 that PCGS and NGC together report really amount to twelve to seventeen different coins. Consider, as an important example, that the Harry Bass 1854-O was PCGS graded AU-55 in 2000 and was NGC graded AU-58 by 2004.
For an 1854-O, the difference in value between grade increments may be anywhere from $15,000 to more than $100,000. “Probably the finest example known,” say Jeff Garrett & Ron Guth in their gold coin encyclopedia (2006, p. 428), is the 1854-O that was found in the shipwreck of the S.S. Republic, which is NGC graded AU-58. According to Garrett & Guth, “it was sold by private treaty in late 2004 for $675,000.” Monaco Financial purchased a large number of gold coins from the firm that salvaged the S.S. Republic, including the 1854-O. Did Adam Crum, the head of Monaco’s rare coin division, sell the Republic 1854-O for $675,000?
A price of $675,000 for an 1854-O is above the values listed in most price guides. In late 2004, the prevailing auction record was the $304,750 paid for the Richmond 1854-O, NGC graded AU-53, at a DLRC auction in New York in July 2004. If it is true that the S.S. Republic 1854-O is the finest known, then it would be unsurprising that it sold for a dramatic premium over the values of the second and third finest 1854-O Double Eagles.
The NGC graded AU-58 1854-O that Heritage sold at the FUN auction of January 2002 is the same as the 1854-O that Heritage sold at the January 2004 FUN auction. This point is explicitly put forth in the Heritage catalogue of January 2004. It is also evident from a comparison of the images of the two offerings. In 2002, it brought $92,000, and almost exactly two years later, it garnered $189,750. Its value thus more than doubled! If it had been auctioned again in Jan. 2006, would its price have doubled again, and realized $380,000?
The collection of Double Eagles that Heritage auctioned, at the 2002 FUN convention, was assembled by Brett B. I will thus call the 1854-O that was auctioned in Jan. 2002 and Jan. 2004 the Brett 1854-O. It may be true that the finest Double Eagles of this date are the Brett 1854-O, the Republic 1854-O, and the Dallas Bank-Browning 1854-O, and the Bass 1854-O. Three of the four are NGC certified AU-58, and the Dallas Bank 1854-O may be the fourth so certified?
The Dallas Bank-Browning 1854-O was auctioned in October 2001 for $160,000. It was uncertified. At the time, coin markets were weak, and there was not much interest in rare date gold coins that grade less than 60. It is certainly true that bidders were thinking of this coin as one of the top two or three, if not the finest. The S.S. Republic 1854-O had yet to be discovered.
Bowers and Merena (New Hampshire) auctioned most of the coins from the Harry Bass collection in New York, during 1999 and 2000. On May 26, 2000, the Bass 1854-O sold for $103,500, which was then an astounding price for an 1854-O. During the 1990s, 1854-O Double Eagles were auctioned for prices ranging from around $20,000 to $46,000 in Jan. 1999. In May 2000, the Bass piece was the only 1854-O to be PCGS graded AU-55. Now, there are three listed, at least one of which is a lower graded 1854-O that was upgraded. The Bass 1854-O is no longer PCGS graded AU-55, though it still may be one of the three listed in PCGS reports.
I have identified the NGC graded AU-58 1854-O that Heritage auctioned in July 2005 as the Harry Bass piece. There is no pedigree information regarding this 1854-O in the Heritage catalogue. In July 2005, the Bass 1854-O sold for $431,250, more than four times the price the exact same coin realized a little more than five years earlier!
Before the B&M-Spectrum auction on August 4, this $431,250 result was the auction record for an 1854-O Double Eagle. The $494,500 record for a PCGS graded AU-55 1854-O is further evidence that the market for rare pre-1880 gold coins is very hot. (Please read some of my other recent articles on CoinLink and find additional evidence.)
My research demonstrates than several auction events are repeat appearances of the same 1854-O Double Eagles. This date is thus much rarer than a list of auction appearances might suggest.
In Jan. 2005, Heritage auctioned a PCGS graded AU-53 1854-O for $368,000. The Heritage cataloguer stated that it is from the “Cincinnati Collection.” I have identified it as the same 1854-O that David Akers auctioned in July 1990 for $23,100, a small fraction of its 2005 price. Akers’ graded it as â€œEF-45â€ in 1990. I saw it. I believe that ‘AU-53′ is a fair grade. Plus, it is a really attractive coin.
I have determined that the PCGS graded AU-50 1854-O that the Goldbergs auctioned in October 2000 is the same 1854-O that Heritage auctioned at the Long Beach Expo during the winter of 2004. It realized $81,650 in 2000 and $161,000 in 2004. If it were offered in 2007, would it sell for more than $300,000?
As for the 1854-O that B&M just auctioned for $494,500, I strongly believe, though I am not completely certain, that it is the same 1854-O Double Eagle that Heritage auctioned in February 2001, for $87,400. If so, the PCGS has jumped its grade from EF-45 to AU-55! It is true that, in Feb. 2001, $87,400 was in the price range for an AU grade, not an ‘EF’, 1854-O. Was it graded “EF-45″ by PCGS years earlier, when standards were more stringent? A price increase from $87,400 to $494,500, in 6 ½ years, is another example of the increased demand for Type 1 Double Eagles (1850-1866), and for circulated rare date gold coins.
In August 2006, Heritage auctioned a PCGS graded AU-50 piece, from the “Wyoming” collection, for $301,875. Before DLRC sold the Richmond 1854-O in July 2004 for $304,750, a price of more than $300,000 for an 1854-O was almost unthinkable.
How rare are 1854-O Double Eagles? David Akers, probably the nation’s foremost expert in gold coins, has, as recently as October 1997, estimated that twenty to twenty-five 1854-O Double Eagles are around today. Winter estimates twenty-five to thirty-five.
The number of auction appearances may have led some experts to over-estimate the number of 1854-O Double Eagles that survive. In addition to the point put forth above that many auction appearances are repeats of the same coins, I hypothesize that an extremely large percentage of known 1854-O Double Eagles have been auctioned over the last quarter century. Some came from some of greatest collections of all time, which happened to be auctioned over the past quarter century or so, including the Eliasberg and Pittman collections.
From the mid-1980s to the mid-1990s, there was very little interest in circulated, rare date gold coins. Advanced collectors of gold coins were focused on coins that graded MS-64 and higher. So, as old-time collections, and collections built in the 1960s and 1970s, were sold, the emerging 1854-O Double Eagles were traded among dealers and speculators, and repeatedly consigned to auctions. So, observers of coin markets could certainly get the impression that there are more than twenty-five 1854-O Double Eagles in existence.
I am not asserting that all known 1854-O Double Eagles were traded during the last quarter-century, just an extremely large percentage of them. I am aware of the PCGS graded EF-40 1854-O Double Eagle that B&M auctioned in July 2005, for $241,500. It was in the same family since early in the 20th century. It is difficult to estimate how many such coins may be locked away somewhere. Could there be many families that just keep an 1854-O Double Eagle, which may be worth from $200,000 to $600,000, after the collecting family-member has long been deceased? I suspect that there are only one or two such 1854-O Double Eagles.
There are also some collectors, particularly of lower grade examples, that may never submit their coins for certification. Coins owned by such collectors, however, were often submitted at earlier or later times by dealers or other collectors. After all, both the PCGS and the NGC were founded in the mid 1980s. How many never certified 1854-O Double Eagles could there be? Garrett & Guth report that the Smithsonian has only one, and they do not mention 1854-O Double Eagles in any other museums.
I suggest that there are twelve to seventeen different 1854-O Double Eagles that have been graded by PCGS or NGC, and five to seven others. My estimate of seventeen to twenty-four is in line with Akers’ estimate of twenty to twenty-five, which should probably stand, for now. There does not seem to be any evidence that there are more than twenty-five. So, it seems that the 1854-O Double Eagle is a Great Rarity.
Copyright © 2007 Greg Reynolds for CoinLink
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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.