The Silver Dollar Does It Again

The silver dollar is making a comeback in a big way. This is because, at the time of writing, demand has been so strong the US Mint has run out of silver. It cannot strike American Silver Eagles, and has issued a letter to this effect.

The United States Mint has struck proof silver coins and circulated silver dollars since its inception on April 2, 1792. This is when Congress passed the Coinage Act. This established the first national mint in Philadelphia – then the nation’s capital. Subsequently, there were four other mints established in San Francisco, New Orleans, Carson City, and Denver.

Today, the Mint’s headquarters (a non-coin-producing facility) are in Washington D.C.. The production facilities are in Philadelphia, Denver, San Francisco, and West Point, New York. Moreover, there is also the famous and ultra-secure bullion depository at Fort Knox, Kentucky.

The United States Mint is responsible for the purity and composition of the coinage it produces. Coins made of pure gold and pure silver will not survive everyday usage as circulated coins. Neither will platinum coins and Canadian Maple Leafs. In other words both metals, in their pure state, are very soft and would wear and lose their sharpness in time. The mint use alloys or amalgams for circulation coins. These strengthen them and make them tougher and more durable in use.

We can divide the series of coins produced by the US mint into bullion, or investment coins, and currency coins.

In our experience, the two most common coins people buy are of silver and gold. Platinum and palladium are far too rare and expensive to use for coinage.

Are they worth it?

The most popular coins in the US are silver dollars. For example, when compared with gold coins, a silver coin is relatively cheap. This makes them far more exchangeable as the coin values are lower.

The value of the material we make a coin of does not always reflect its monetary worth. To use a similar example, a hundred-dollar bill is not worth $100 in materials. The bill is just a few cents worth of paper and ink. Its monetary worth is way in excess of this amount. This difference in value is its perceived worth.

In the same way, they make coins today of base metals (unless they are bullion coins for investment purposes). These do not reflect their true value either.

The US Mint issued the Morgan silver dollar, the peace silver dollar and Liberty seated as legal tender. They are not pure silver bullion coins. They have a 10% copper component to harden the metal used to strike the coin. The face value of the coin does not reflect its true worth. There is a further consideration with the value of silver dollars. They have melted many of these coins down, through the years. This is to to realize the true value of the silver in them. This resulted in these coins becoming scarce. This scarcity of certain coins has increased their perceived value.

We call this their “Numismatic value.” It is the price a circulated, un-circulated or proof coin brings on the open market.

Know Your Coins

A coins value is determined primarily by the scarcity of the coin, its condition, supply, and demand. The value of these coins increases over time as they become scarcer and harder to find,

They grade such coin’s condition on a scale of 1 to 70 by experts with specialized training using a rigid set of guidelines. We consider coins with a grade of 70 flawless. The main grading service in the US is the PCGS (The Professional Coin Grading Service) and is based in Newport Beach, California. Theirs is the recognized guarantee of grading accuracy and authenticity for coin dealers throughout the United States.

Knowing the key dates, varieties, and rarities of the silver dollar coins that interest you in will give you an edge when it comes to negotiating prices, bartering with dealers, and finding great bargains at sales. The slightest variations in a coin often lead to large differences in value. The Internet is invaluable for studying photos and descriptions of coins.

Whether you are collecting an Eagle coin or a seated Liberty, researching and investigating the provenance and history of your coin will gain you hundreds, possibly thousands, of dollars.

In the same vein there are internationally recognized collector’s items. Moreover, some, such as South African Krugerrands, are individual coins like our American Eagles. Others are acknowledged series of coins like the Chinese Lunar collection which depicts the animals of the Chinese lunar calendar.

Knowledge is power when it comes to dealing in silver coins – you can never know enough about them.