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Coin Rarities & Related Topics: Bowers & Merena auction, Proof 1876-CC dime, and $150 million for the CAC

News and Analysis regarding scarce coins, coin markets, and the coin collecting community #5

A Weekly Column by Greg Reynolds

I. Today’s Theme

I will not be discussing the most expensive or the rarest coins that are coming ‘on the auction block’ this week. Rather, I have selected a few that I find to be both newsworthy and particularly interesting. Admittedly, these are expensive. I continue to insist, though, that an understanding of rare coins, and of the values in the coin collecting community, requires knowledge of coins that most collectors cannot afford.

Suppose that this column was geared towards art enthusiasts rather than coin enthusiasts. Would it then make sense to discuss only the paintings that most art collectors could afford? Collectors who cannot afford great and culturally important paintings enjoy learning about them and often learn to apply their knowledge of famous painting to their interpretations of a wide variety of not-so-famous paintings. Likewise, coin enthusiasts, in general, appreciate coins that are great, famous, very rare and/or important to the culture of coin collecting.

Please see my discussions below of the following coins. The 1851-O trime is the only Three Cent Silver issue that was not struck at the Philadelphia Mint. Indeed, it is curious that the New Orleans Mint struck this denomination, as the Branch Mints tended not to manufacture small denomination coins in the 19th century. The Hawaiian Eighth-Dollar is certainly extremely rare and extremely curious. The 1926-S nickel issue is just incredibly difficult to find in MS-65 or MS-66 grade. As I discussed one in last week’s column, I could not resist mentioning another, as B&M will auction it this week in Baltimore. Similarly, I discussed a rare and historically important King James II English gold coin last week and B&M will auction a coin of the same design type this week. Plus, the unique Proof 1876-CC dime is one of the most exciting coins of all.

II. The CAC Surpasses $150 Million Level

It is widely known that the CAC approves (or rejects) submitted coins that are already graded by the PCGS or the NGC. Approved coins receive a green sticker, or, in rare instances, a gold sticker. It is not as widely known that the CAC will make sight unseen commitments to pay competitive prices for CAC approved coins. These are not ‘low ball’ bids. As of June 15, the CAC has purchased $154 million of coins, almost all of which are CAC approved.

The CAC was founded by John Albanese in Oct. 2007. CAC purchases have thus been averaging more than $4.7 million per month. The $150 million level was reached in early June.

Albanese was the sole founder of the Numismatic Guaranty Corp (NGC) in 1987. Around Dec. 1998, he sold his shares in the NGC to Mark Salzberg, who is the current NGC Chairman. (For more discussion of the CAC, please see my articles on CoinFest, Jay Brahin’s Coins, the PCGS graded MS-68+ 1901-S quarter, the 20th Century Gold Club, and Dr. Duckor’s quarters.)

Although the CAC has acquired thousands of coins that are valued at under $5000 each, the CAC has approved and acquired some very famous coins. Among others, the Eliasberg 1870-S silver dollar and the finest known, Rogers-Madison 1796 ‘No Stars’ Quarter Eagle ($2½ gold coin) come to my mind.

III. Unique Proof 1876-CC Dime

Laura Sperber, of Legend Numismatics, acquired the unique Proof 1876-CC dime from a New Jersey dealer in early June. On Saturday, June 12, she sold it for an amount in excess of $200,000. It “went into a collection of Proof Seated Dimes,” Sperber reveals. It is certified as Proof-66 by the PCGS and has a sticker of approval from the CAC.

I have carefully examined this 1876-CC dime on four occasions, and it is one of my all-time favorite U.S. coins. It would certainly be on my personal list of the fifty most important and interesting U.S. coins. Please click here to see the article that I wrote about it in Jan. 2008. Therein, I put forth reasons as to why I am certain that this coin is a Proof, and I discuss the differences between Proofs, Specimen Strikings and business strikes.

I have always had a strong affinity for Branch Mint Proofs, which are pre-1968 Proof U.S. coins that were NOT struck at the Philadelphia Mint. As far as I know, this is the only Proof Carson City (Nevada) Mint dime, of any date. Other than a few silver dollars and possibly a couple of half dollars, no other Carson City Mint coins that are plausibly Proofs come to mind at the moment. I have never seen a Carson City Mint gold coin that any recognized expert would regard as a Proof. Please read an article, which I wrote earlier this year, about the only known Proof Denver Mint Double Eagle.

IV. Another ‘Gem’ 1926-S Nickel

The offering by B&M of an NGC graded MS-65 1926-S nickel is more interesting now than it would have been in other circumstances. In the recent Heritage Long Beach auction, it became clear that the market for gem quality better-date Buffalo Nickels is weak, certainly in comparison to the strong demand for such coins in 2007 and much of 2008. The 1926-S is one of the hardest dates to find in MS-65 or MS-66 grade. The CAC has not approved even one 1926-S nickel in MS-65 or higher grade. (Please see my discussion of auction results of 1926-S nickels in last week’s column. Also, click here to read my discussions of astounding prices that some high-grade Buffalo Nickels realized in an April 2008 auction and in earlier events.)

Though it is not a good idea to draw firm conclusions from catalogue images, this 1926-S does appear to be naturally toned. At least, it certainly does not exhibit a counterfeit rainbow or the paint-like deep-blue colors that are found on many artificially toned Buffalo Nickels. Further, it does appear to be relatively free of contact marks. Is it very impressive?

V. 12½ Cent Piece of Hawaii

There are only a few different coins that were issued by the Kingdom of Hawaii in the 19th century. A copper cent was minted in 1847 for the Kingdom by a private mint in Massachusetts.

In 1883, silver coins of several denominations were issued for circulation, and Proof sets were minted as well. The San Francisco Mint produced the business strikes and the Proofs were minted at the Philadelphia Mint, according to Walter Breen. Additionally, some patterns of Hawaiian coins were produced.

Although the Eighth-Dollar (12½ cent) piece should properly be termed a pattern, these were included along with Proofs of the regular denominations of 1883 in a small number of Proof sets. Eighth-Dollar coins, which are a Proof-only issue, tend to be collected as if these were Proofs of regular denominations. In another words, collectors seeking Proofs of the dime, quarter, half dollar and silver dollar denominations of the Hawaiian coinage of 1883 also seek a Proof Eighth-Dollar. Other collectors wish to own an Hawaiian Eighth-Dollar piece as well, as these are curious.

As there are probably fewer than fourteen in existence, most collectors who seek an Hawaiian Eighth-Dollar never manage to obtain one. The Eighth-Dollar to be offered in the upcoming B&M auction is PCGS certified Proof-63 with a designation that it has a Cameo contrast, which means that, to a large extent, the devices are frosted white and sharply stand apart from mirrored fields. According to the catalogue, it is in a PCGS SecureShield holder and was thus encapsulated in 2010.

VI. 1851-O Three Cent Silvers

Three Cent Silvers (trimes) were minted from 1851 to 1873. Yes, these are smaller than dimes. Indeed, trimes are even smaller than half dimes, which then each weighed about half as much as a dime. The 1851-O issue attracts more attention than the other trimes because it is the only trime that was minted in New Orleans. All the rest of the Three Cent Silvers were produced at the headquarters mint in Philadelphia. The 1851-O is not rare in absolute terms. It is, though, a condition rarity in MS-66 grade. The PCGS has not graded one as MS-67 or higher.

A PCGS graded MS-66 1851-O Three Cent Silver is being offered in the B&M auction that is being held this week. The mottled russet toning about the peripheries, and in the outer fields, will not dazzle. It is, though, exactly the kind of toning that is characteristic of this issue. This toning is almost certainly natural. It is in a SecureShield holder, which indicates that it was scanned with a CoinSecure CoinAnalyzer and encapsulated in 2010. Another 1851-O has been PCGS graded MS-66+. There is a picture of this “MS-66+” trime on, and, much to its credit, it has mottled russet toning like that found on the one in the current B&M auction, as best as I can tell from images. To form solid conclusions about a coin’s toning, there is a need to actually examine the coin.

In May 2009, Heritage auctioned a PCGS graded MS-66 1851-O, with a CAC sticker of approval. It is not one of the coins mentioned above or below. It realized $5462.50 when coin markets were bottoming out. Coin markets were certainly at lower levels in August 1999 when another PCGS graded MS-66 1851-O was auctioned for $3680.

Although the PCGS reports fifteen as having been graded MS-66, the absence of a PCGS graded MS-67 1851-O provides a tremendous incentive for crackout artists to remove MS-66 grade coins from their respective holders in order to resubmit them in hopes of receiving a MS-67 grade. I am skeptical that this count of fifteen amounts to even ten different coins.

In this same auction, there is also an NGC graded MS-66 1851-O and an NGC graded MS-62 representative of this issue. Fourteen have been NGC graded MS-66 and three have been NGC graded MS-67. Again, I doubt that fourteen plus three equals seventeen different coins, perhaps just eleven, if that many? As the NGC and the PCGS grade Three Cent Silvers with different criteria, I will not combine population counts or attempt any kind of condition ranking here.

It is noteworthy that the CAC has approved, much to my surprise, nine MS-66 grade 1851-O trimes, which includes a combination of those graded by the PCGS and the NGC. Invariably, dealers sometimes ‘crack’ coins out of holders with CAC stickers, and, when such coins fail to upgrade at the PCGS or the NGC, the same coins in new PCGS or NGC holders may be re-submitted to the CAC. Therefore, the listing of nine CAC approved 1851-O trimes may not be indicative of nine different coins.

In Jan. 2009, Heritage auctioned an NGC graded MS-66 1851-O trime for $4255, which is less than the exact same coin realized, $4370, in a Feb. 2005 Heritage auction. It is not the same as any of the other 1851-O trimes mentioned above. It will be interesting to see how these three 1851-O trimes fare in the B&M auction.

In general, I find that high grade 1851-O trimes have been overlooked for years. Steve Deeds, the president of B&M, suggests that “the 1851-O Three Cent Silver is an underrated coin.”

Matt Kleinsteuber, of NFCcoins, has a different perspective. Kleinsteuber agrees that there is more demand for the 1851-O trimes than for the other Type 1 and for Type 2 Three Cent Silvers. Kleinsteuber observes that, as “MS-65 and -66 1851-O Three Cent Silvers are seen so infrequently, it is hard to [pinpoint] prices” for these. Moreover, Matt has always “found that there is a lot of collector interest in 1851-O Three Cent Silvers and prices for them in Good-04 to MS-63 have held up well over the last couple of years; they have not gone down at all. They are easy to sell, and prices for 1851-O Three Cent Silvers might even be rising” so far this year. Matt does “not believe that 1851-O Three Cent Silvers have been overlooked.”

VII. King James II Gold Coin

King James II ruled England for just a short time, from 1685 to 1688. The gold coins from his reign are rare. For reasons relating to democracy and religious tolerance, his policies and especially the circumstances under which his reign came to an end are of tremendous historical importance.

Last week, I wrote about a 1688 James II Five Guineas gold coin that sold for $106,375 in a recent Goldbergs auction. It is NGC certified MS-64 Prooflike and was earlier in the epic Millennia collection. (Click to see my series of articles on the Millennia collection: Part 1, Part 2, Part 3, etc.) The James II Five Guineas coin in this week’s B&M auction is dated 1687 and is not quite as illuminating. It will be, though, much less expensive. It is NGC graded Extremely Fine-40 and is estimated by B&M/Ponterio to realize from $7,000 to $10,000. Also, James II gold coins of the Half-Guinea, One Guinea and Two Guineas denominations are more modestly priced than the Five Guineas coins.

Next week, I will discuss coins to be offered in the auction to be held in conjunction with the Summer FUN Convention, July 8 to 10, in Orlando.

©2010 Greg Reynolds

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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