by John Feigenbaum – David Lawrence Rare Coins

Back in January 2005 I wrote an article for the cover of Coin Dealer Newsletter titled, “Are Seated & Barber Coinage Ready to Explode?” With the hindsight of two and half years, it would appear that the fuse on this explosive was longer than I had first anticipated, but I feel more strongly than ever that these, and other long-overlooked series, are a tinderbox waiting to ignite.

For starters, I wasn’t all wrong… many of the standout key dates in series from Flying Eagle cents to Morgan dollars have seen their values double and triple over the past five years. It has been no surprise to the numismatic community that these issues turned a nice profit for their owners in the past decade. There is a finite supply of such items, and their popularity appeals to collectors that have been around for decades. But the influx of new buyers in the past 10 years has provided a price tension that demand couldn’t supply.

Surprisingly, however, a number of scarce-date issues in the same series as their more famous cousins have waited patiently on the sidelines at remain at the same prices we witnessed in 1990. I refer to these as “second-tier” issue. They are much scarcer than type coins but not as rare as the key dates.

Furthermore, an examination of the true great numismatic rarities is also compelling from a value perspective. While more coins than ever are broaching the million-dollar mark, the value of such rarities in comparison to other major collectibles is still compelling.

The remainder of this article is broken down in two parts: first, an evaluation of the different value levels of coins (major rarities; Key-Date coins; and better date, or “Second-Tier” coins). The second part of this article is devoted to an analysis of the Seated and Barber coinage, as these two series are loaded with examples from all three of these rarity areas.

Major Rarities Still Undervalued

The major rarities are, of course, the most exciting aspect of numismatics to the outside world, and also the most likely to be acquired by non-collectors — dare I say the word “investors”? There has been no lull for the major rarities over the past 10 years. In fact, prices just keep rising as the greater economy experiences similar exuberance at the highest level. The hour-glass shape of the international wealth curve suggests that wealthy investors have a difficult time investing their money in a diversified manner and the rarified art market has seen explosive gains, even in the past year. Post-war art (the equivalent of our “modern issues”) is off the charts as an Andy Warhol realized an astonishing $71 million in May (Sotheby’s). As an artist, Warhol was prolific with many items regularly available for bidding. A great piece, yes. But unique, certainly not. Collectors are voting with their pocket books and the popular items with great stories are bringing unheard of results. In rare coins, we feel the same phenomenon is underway, with plenty of remaining potential.

In the month of July, we brokered the sale of the finest known 1894-S dime (PCGS Proof 66) for a record $1.9 million. This is the same coin we sold in March 2005 (DLRC Richmond Collection Auction) for $1.3 million. The buyer was undeterred by the prior result and felt strongly about this purchase as his motive part of an overall strategy to shift his assets from the stock market to hard assets.

Steve Contursi, of Rare Coin Wholesalers, announced a similar private transaction earlier this month of a gorgeous, gem 1792 half dime for $1.5 million. Even though this is a great coin, there are several hundred 1792 half dismes known – this being among the very finest. What is happening here? Clearly a case where the valuation of our greatest coins does pales to the buying power of the top consumer. I suspect we will see the few rarities that come up for sale in the next 12 months do quite well.

Key Date Coins Ready for a Second Run?

Even as I wrote my article in 2005, key date coinage had already gone through a steady round of price appreciation. Since that writing, levels on coins that had seen sharp price spikes in the years 2002-2004 tended to flatten and, in some cases, decline. 1893-S dollars haven’t gone down in price but they haven’t changed positively in quite some time, either. 1877 Indian cents, 1909-S VDB’s, 1916 Standing Liberty quarters, are all similar examples of coins that ran up quickly only to see too much exposure as collectors dumped excess inventory for big profits.

I believe now is a very good time to cherry pick through these issues for high quality coins at current levels. One can even justify a small premium for nice pieces, because I fully expect another strong demand cycle to occur in the next 6-18 months. Levels have stayed flat for too long and I can no longer find enough material to fill customer want lists. Levels will have to rise soon.

Hidden Value in the Second Tier

Examples of such items could include Carson City mint issues within the Seated series; New Orleans and San Francisco Mint issues of the Barbers; low mintage dates like 1913, 1914, 1915 (Philadelphia) half dollars; and so on. Many of the second-tier key dates within all coin series have long been neglected that they are now considerably undervalued in relation to their “key date” cousins.

In just the past two-three months I have seen an abrupt recognition of this stored value in the results of our weekly Internet Auctions. Collectors are quickly recognizing that these issues are underrated and bidding them up aggressively. In our Internet Auction ending July 23, we had a consignment of several 1914-S Barber quarters in VG-VF condition. (The 1914-S is an ideal example of a Second-Tier Key date coin because it’s a low mintage issue within the series and Barber quarter collectors are well aware of the difficulty in finding a problem free-example.) In this sale we offered two NGC-graded VF examples which were very nice, solid coins but not undergraded or otherwise mis-attributed. The reserve was a fair $210 and the winning bidder would have to pay a 15% buyer’s premium (BP). I fully expected these would bring in the neighborhood of $275-325 each, before BP. But I shocked to see over a dozen bidders compete to hammer prices of $725 and $850. CDN Monthly Supplement values these coins at $235! Something is afoot, and this phenomenon is not limited for to 1914-S quarters in VF. We’ve seen Seated coinage in the “collector” grades going nuts over the last few months. There simply isn’t enough material to satisfy collectors.

AN EXAMINATION OF THE SEATED & BARBER SERIES
I have always been a huge fan of the Liberty Seated and Barber coin series. The ratio of scarce dates to common dates is huge. If one removes the handful of common, or “type” coins from the Barber dime series, more than half of the remaining issues are genuinely tough to rare to locate in higher grades (VF-MS67). Even some of the type coins can be elusive in higher grades as their high mintages didn’t entice collectors of the day to hoard issues.

For decades these series had enjoyed quiet anonymity among their more popular cousins (like Walking Liberty half dollars, Morgan dollars, Saint Gaudens, etc.). There are several reasons that these series have been overlooked. For starters, the Seated dime, quarter and half dollar issues spanned a long time. Depending on the issue, these coins were minted anywhere from 1837-1891, with over 110 coins each in the basic business strike sets. (Seated Half Dimes are the most accessible — with the fewest number of difficult coins — if you don’t count the unique 1870-S.)

Additionally, the coins are quite scarce, and some unknown in mint state grades, requiring the collector to have deep pockets, as well as a great deal of patience. Many of the coins do not come up for sale for years at a time. The Seated quarter series is home, among other rarities, to the 1873-CC quarter, no arrows. Only five examples are known of this issue. In the very short twenty-cent series, the 1876-CC is rare enough (with 12-15 known) to intimidate most seekers.

The Barber series are actually much more attainable in mint state than their Seated counterparts. Only the Barber quarter series has issues that require the buyer to spend five figures to complete a set in MS60 — the 1901-S. There are key dates in all three sets, but the sets are challenging and rewarding to complete. Unlike twentieth century series, like Buffalo nickels and Mercury dimes, these sets require patience over money. A collector once told me that he was taking a break from Morgans because he ran out of money too quickly. That’s a rare complaint from Barber collectors. From them, you are more likely to hear that they cannot find enough to suit their budget! We tend to consider a Barber issue “common” if the population in MS65 is 10 or more coins. In the Morgan dollar series, that would be a rarity, worthy of $100,000 or more.

Let’s compare the 1895-O Morgan dollar with the 1895-O Barber dime. There are 226 total mint state coins graded of the Morgan issue (PCGS and NGC combined) and CDN bid values range from $12,800 in MS60 to $160,000 in MS65. In contrast, the dime, has a total mint state population of 52 coins, bid values of $4,400 in MS60 and $15,000 in MS65. Collectors and investors alike are starting to appreciate the potential hidden in these other series.

Below, you will find some basic analysis for each of the Seated and Barber series discussed here, with of the pros and cons to consider before undertaking the challenge of assembling a collection.

Liberty Seated Half Dimes

Our favorite “entry level” Seated set. Very few impossible dates in this set, but still quite a challenge. Try to buy as many dates in mint state as possible, and the keys in the best grade you can afford/find.
Favorite dates: 1846, 1853-O No Arrows.
Unique coin: 1870-S

Liberty Seated Dimes

A wonderfully challenging set, with some very tough dates, but still nothing out of reach in lower grades. Don’t overpay for the overrated 1844 which has been hoarded.
Favorite dates: 1860-O, CC’s from 1871-1874, 1885-S
Unique coin: 1873-CC No Arrows

Barber Dimes

A great set for the intermediate collector who seeks a long-term challenge. Complete sets in matched grades will take a year or two to complete. We recommend that collectors seek the two major varieties of the 1893/2 and micro O as an additional and very relevant parts of the set.
Favorite dates: 1894-O, 1895-O, 1893/2 & 1905-o Micro O (for varieties)
Major Rarity: 1894-S Branch Mint Proof

Twenty Cent Pieces

A great mini-challenge, especially if you avoid the 1876-CC rarity. Most collectors assemble all issues in MINT STATE and Proof. The 1876-CC is a great rarity with a great story that transcends the series; it is one of my personal all-time favorite coins.
Favorite date: 1877 Proof only
Major Rarity: 1876-CC

Liberty Seated Quarters

Truly a set for the advanced collector – a challenge which will require patience and resources. Only a handful of complete high grade sets have ever been assembled. Many scarce and rare dates.
Favorite dates: 1842 Small Date (Proof only), 1854-O huge O, 1860-S, 1870-CC, 1871-CC, 1873-CC No Arrows & With Arrows, 1891-O (in mint state)
Major Rarity: 1873-CC No Arrows (5 known)
Unique Coin: 1866 No Motto Proof Only

Barber Quarters

A great set for the intermediate collector who seeks a long-term challenge. Like the Barber dimes, and halves, complete sets in matched grades will take a year or two to complete. No major varieties to contend with.
Favorite dates: 1896-S, 1897-S, 1901-S, 1909-O, 1913-S
Major Rarity: None

Liberty Seated Half Dollars

An endeavor for the intermediate-advanced collector who can expect to spend a few years matching a nice set. Scarce dates abound, yet completion is not as difficult as the quarter or dime sets.
Favorite dates: 1853-O No Arrows, 1855-S, 1870-CC, 1878-S
Major Rarity: 1853-O No Arrows
Unique Coin: 1866 No Motto Proof Only

Barber Halves

A great set for the intermediate collector who seeks a long-term challenge. Like the Barber dimes, and quarters, complete sets in matched grades will take a year or two to complete. We recommend that collectors seek the major varieties 1892-O micro O as an additional and highly desired of the set. It is quite rare in mint state. The 1904-S half is one of our all-time favorite value coins in numismatics.
Favorite dates: 1892-O Micro O, 1904-S
Major Rarity: None

John Feigenbaum is President of David Lawrence Rare Coins and DLRC Auctions. David Lawrence specializes in collector coinage and runs multiple Internet auctions every week. You can learn more on their web site at: www.davidlawrence.com, or call 1-800-776-0560. John can be reached by email at: john@davidlawrence.com.

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