An unexpected way some US gold coins were destroyed.
RogerB
Posts: 8,852 ✭✭✭✭✭
A newly located letter to a Member of Congress reveals one unusual way US gold coins were destroyed during part of the 19th century.
January 23, 1882
Hon. H. G. Fisher
House of Representatives
Sir:
As understood by the officers connected with the Mint service, the right to deposit gold bullion for payment of its value in coin or bars does not authorize the receipt at the Mints of United States gold coin in exchange for gold bars. To obtain the latter, manufacturers frequently roll out or mutilate such coin and bring it as gold bullion, which they have a right to deposit.
I have prepared and send you a bill authorizing the receipt and exchange of United States coin for bars. Please introduce and have it referred to Committee on Coinage, Weights, and Measures.
Very respectfully,
Horatio C. Burchard,
Director
RG 104 Entry 235 Vol 028, p.39.
Comments
wow!
BHNC #203
Such are technicalities. Always a way around. Thanks, Roger for the interesting info.
Jim
When a man who is honestly mistaken hears the truth, he will either quit being mistaken or cease to be honest....Abraham Lincoln
Patriotism is supporting your country all the time, and your government when it deserves it.....Mark Twain
I don't think I have this straight in my head yet, but rolled out or mutilated gold coins contain 10% copper and is not an equal exchange for gold bars? Were the gold bars purer gold?
"Keep your malarkey filter in good operating order" -Walter Breen
Bars were 0.995 or better. The mutilated coins were received as bullion, then melted assayed, etc. and the depositor paid in bars for industrial use.
It's not likely this bill passed. The reason coin was not accepted as bullion was that it could be heavily worn, filed, etc. Coin has seignorage, bullion does not.
http://macrocoins.com
Not much has changed with government, lol
Good point. A ten ounce bar of .995 fine gold has to have 9.95 troy ounces of gold in it, a known commodity.
$100 face in gold coins could have 9.675 tr. oz. of gold if uncirculated, but they could contain say 9.575 tr. oz. if worn but still within legal tender weight tolerences.
Did the bill specify that gold coins had to be of a minimum weight to be accepted in exchange for bars?
Gold coin that was within weight tolerance was required to be accepted in commerce, but as rmpsrpms noted, coins brought to the Mint for purchase of bullion might not be of full total weight equaling the gold in bullion bars. Of course, the coins could have been weighed, but even then there were dirt and oils acquired during handling that would increase coin weight.
This was also the reason that gold coins were NOT accepted for Customs payments, but Gold Certificates were OK.
PS: "Coin has seignorage, bullion does not." Gold coins did not have seignorage. Early gold was actually negative seignorage because it contained up to 0.005 silver.
Geez !!!
Interesting, did the mint charge a fee to convert bullion to coins or bars?
Good information.... did not know they exchanged coins for bars.... Cheers, RickO
RE: "...did not know they exchanged coins for bars." The mints and NYAO didn't - that was the purpose of the proposed legislation.