Mass Meltings Revisited: Rick Tomaska and the 1928 Saint Gaudens
Weiss
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Was flipping through channels a couple of days ago and came across Rick's TV coin hawking. He does a pretty good presentation though of course he sells the sizzle. I can't imagine how much overhead a TV show takes to produce and distribute.
Anyway, he threw up a graphic about the percentage of pre-1933 gold coins that had been melted, ostensibly because of Executive Order 6102.
I can't find the graphic--IIRC it said pretty much 30% of all denominations were melted. I'm not doubting the figures though they can be manipulated with an asterisk. But it's a sobering revelation.
And then there's this: When I was trying to find Tomaska's graphic, I stumbled upon a somewhat hidden PCGS article ( https://www.pcgs.com/news/after-the-melts-whats-left-in-silver-coins ) about silver meltings. It says, among many other interesting things, that the mass meltings of silver coins in the late 20th century all but destroyed the "seed coins" that many young collectors with little money needed in order to shoehorn themselves into the hobby. Without an inexpensive entree into our hobby, they never entered it. The article quotes some guys who were there:
**[Silver Towne's Late Leon E.] Hendrickson calculated that during 1979 and 1980, Silver Towne alone processed "thousands of bags" of silver coins that were destined for refiners' melting pots.
The late Joel Coen of New York, a coin dealer who played a central role in the great silver melts, totally agreed with Hendrickson's assessment. In a 1985 interview, he shared his concerns with me. Coen estimated that of all the silver coins produced by the United States Mint, only about one-quarter survived the ongoing melts. He confided that he himself sold refiners $400 million worth of fabricated silver, mostly silver coins, during the one-year period from July 1, 1979 to June 30, 1980 -- "and," he commented, "other guys were doing the same thing."
"I remember one day melting 100 bags of 1963 Franklin halves," he related. "And, looking back, I'm glad I did. The most they bring today is maybe 6 bucks apiece, and I guess at that point I must have gotten 13 or 14 dollars each for them as dead items."**
I hadn't really thought about how the lack of lower end material impacts entry-level collectors. Thoughts?
--Severian the Lame
Comments
What they were melting had almost certainly been picked over, so generics, damaged coins, very low-grade coins, etc. went to the melting pot. There are still plenty of cheap starter coins. There is a B&M shop in Tucson that seems to specialize in these cheap coins and modern U.S. Mint products--I don't know how he stays in business.
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
That's what I would have thought, too. And maybe it's correct. But the article argues otherwise, anecdotally at least:
Something else seems clear regarding the melts themselves: While common-date coins and circulated pieces made up the bulk of the items that were melted, scarcer ones frequently bit the dust, as well. Although they had premium value as collector's items, many were worth even more as mere metal when bullion prices shot through the roof.
Many silver proof coins were melted, for example. So were certain semi-key silver coins in lesser grades.
--Severian the Lame
I recall even seeing Liberty Seated coins going to the melting pot in 79-80.
Yup.... And some of the coolest art nouveau and art deco sterling you could imagine.
I got a 9 oz filigree cigarette case 18K and could NOT find a buyer at the top.
The mother of a fellow dealer did save all the sterling treasures. She was smart.
That's really unfortunate. Looks like this was more serious than I thought.
RMR: 'Wer, wenn ich schriee, hörte mich denn aus der Engel Ordnungen?'
CJ: 'No one!' [Ain't no angels in the coin biz]
Yet, if you look at Junk Boxes at shows, etc. and compare prices to MS grade coins, the difference for "common" is almost nil. I am not talking about some Variety or Oddity, but say a plain jane 1963 Washington quarter. They are almost the same price, beat up or MSXX. During the last run up, a local B&M allowed by to paw through stuff he was sending to melt, with most all Washington Quarters still in their 2x2's, in Uncirculated condition, and take my album from the 1960's I had build from change, and pop out and replace for 25 cents a coin. It did not include key dates, but I upgraded probably 60% of my coins. Same with Franklins, and Roosevelts, which were already complete, and picked up a lot of Walkers and Mercurys for melt to fill holes.
I would hazard a non scientific guess that 25% of all post 1880 surviving silver coins from dime to dollar could be screened and melted and not have more than a tiny blip on the "normal" price of those coins. Yes, it would take out a bunch of beat up 1921 Morgans, and slicked out 1940's washington quarters, and reams of unloved Franklins, but the herd would be stronger, and those who wanted to "start" collecting would be, for effectively the same money, buying MS commons instead of buying VG commons for effectively the same price, and then realizing after a year, that they screwed up.
Fair and AG Barber coins used to be very common items in dealer stock. The 1979-80 and later melts changed that. Those were the coins that found their way into Whitman folders. Today they are gone. I don't miss them and doubt if many new collectors would be interested in them today.
I am sure some real treasures hit the melting pot...it was amazing the fever that hit during the run up. I saw people hitting antique shops, yard sales and even putting want ads in the paper...was crazy for a while. Cheers, RickO
Still see plenty even in G/Vg sitting in junk silver boxes. Need another good "melt" to thin the stock further.
Barbers were probably in there up to grades of F-VF.
I watch Tomaska on occasion. He points out some worth watching for but his prices are too rich for my blood. Even though some of the issues he points to appear to seem "scarce" in relation to other dates, having 2000 of a particular date and mint mark in a particular grade by TPGs does not outstrip supply/demand.
Last sentence was awkward but saying many of his "scarce" coins just aren't scarce enough.
There absolutely were F-VF Barbers. I have some
I was a teen when the silver boom hit and used to hang out at the LCS. He would let me and a buddy search through the silver before he shipped it out. As long as we replaced it dollar for dollar with other silver, he didn't care and was actually happy for us when we found something good. The biggest problem was coming up with enough 1964 dimes and quarters to trade for the ones I wanted. I ended up with a fair number of F-VF Barber dimes and quarters (not many halves), plus filled/upgraded most of my Mercury dime folder.
Well, rare coins are..... rare.
Attrition, loss, damage, corrosion, melting, etc.... All of it has contributed to the scarcity and value of what is left today.
If we had to sacrifice 90% of the extant Morgans and Peace dollars (to stave off enslavement by aliens, for example) it would surely come from culls, sliders, and baggy MS60-62 coins. I doubt it would move the numismatic needle much on what I collect. They made 85 million Morgans in 1921 and 83 million Peace dollars in 1922. I think I saw at least half of them still in dealer cases at the last Summer ANA show I attended.
I rescued a bag of silver dollars that was headed for melt by a family member. Still have it and some day I intend to go through it and see if there are any special dates.
It's completely expected that anything with collector value up to the silver equivalent would have been thrown in the smelter.
So it's reasonable that most of the lower grade slightly collectible material went up in dust at the time.
If we had a run today to $35-40, all of those slightly collectible Morgan dates or common Peace sliders would likely go...
I have watched his show briefly a couple times. Prices always seem
too high. Population reports should be taken with a grain of salt
He seems to use them to hype more or less fairly common coins
JMHO
His show is way overhyped with everything overpriced. That's the guy who you'll never see at a local show
I would have gone through it 100 times by now......
You might be surprised how poorly picked over it was. There just wasn't time and it was coming in in such vast quantities. Nobody tossed bags of '49-S Franklins into the furnaces but there were a ,lot of mixed bags and a roll or two here and there no doubt got lost in the shuffle.
But 75% melting is not at all realistic. The FED got about 30% in '68/'69 but later melts didn't even approach this.
$400,000,000 at an average $18 / oz is a drop in the bucket and wouldn't even wipe out the '64-D quarters.
There was a phenomenal amount of great silver being destroyed and much of this was fabricated items like old silver sets. Some was in excellent condition and should have been valuable even then. I believe most fabricated silver of this sort was never replaced so if prices rise again there will only be coin and 999 sold into any increase. A lot of this is owned by coin collectors rather than investors or the general public. There will still be plenty of junk coin to get melted though.
In the '60's there were lots of F and some VF Barbers in mixed lots. Rarely an XF would be seen. G's and VG's were typical but there were plenty of AG's and some culls. A lot of these were melted in '79 but by that time most of the higher grades had been picked out of many of the groupings. Half dollars and quarters were more heavily picked over. Yes, lots of F's and VF's were melted but most of the Barbers being melted were G's and VG's along with culls and heavily worn coins.
Typical groupings today are pretty low grade cull because nicer specimens sell at premiums. Even VG's can be sold except for common dates.
There are pretty massive quantities of industrial silver that get recycled too. A USGS report from 2003 cites around 1800 metric tons of silver being recycled per year in the US. At current spot prices, that works out to about $1.03 billion PER YEAR! The report mentions the various sources of recovered silver and includes household sources, scrap, jewelry, catalysts, photographic film, and such. Coins receive only a minor mention.
About 2500 metric tons were consumed for photography alone in 2000. This has decreased with the growing use of digital imaging, but probably not by as much as you might think. Industrial, medical, and dental x-rays still use quite a bit of old-fashioned film.
Lots of population report abuse on that show IMO.
Dave
I was speaking to a barber some collector at a recent show who filled up almost an entire Whitman album from junk bins during the last run up.
I worked part-time at a local B&M at that time period.
I can remember being given huge totes of proof sets 55-64, and just cutting them up and throwing the coins into a 5-gallon pickle bucket.
I would pull the cameos for him but of course no time to look for varieties---this was before cameos were a regular "thing".
Also many seated coins were melted.
And silver dollars....every peace dollar unless it was a 21 or 28 went into the buckets.
Morgans....pretty much everything except CC's and early 90s stuff was also melted.
Imagine how much crap would still be out there if not for this time period.
It is staggering how many coins were and still are out there.
I go to a local pawnshop probably twice a month and pick through a jug that they throw 90% in for sale. They sell it at melt and unless ya a key date, it goes in there. They buy at dirt cheap prices so they have no issue with selling at melt. They usually have like $150-200 face to choose from.
I’ve filled up several dansco albums with decent coins from that bucket. Mercs, washies, franklins, slqs and barber coinage too.
While these aren’t gems, getting barbers/full date SLQ, holed or slick dollars and even some slick seated coins for melt, i would never say no.
One day I’ll find a 1916 slq...
All original skinned and some better date Newfoundland and Canadian coinage at a few percent behind melt. They are from the local coin shop and the owner takes out the obviously better pieces before sending off the bulk coinage to trade or melt, but if these pieces don't sell then they are sent off, too. Nice Newfoundland coinage is far tougher to find, in my experience, than nice US pieces-
In honor of the memory of Cpl. Michael E. Thompson
this is a phenomenon that repeats itself every time Silver spikes high enough. most of the real gems are safe but most of the circs find their reincarnation.
Was she? What could she sell them for now relative to the $50 per ounce silver price?