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Lot
5691

1856-O $20 AU53 PCGS. Variety 1....

2014 August 5, 7 & 9 ANA US Coins Signature Auction - Chicago #1208

 
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Auction Ended On: Aug 7, 2014
Item Activity: 9 Internet/mail/phone bidders
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Location: Donald E. Stephens Convention Center
5555 N. River Road
Rosemont, IL 60018
Description:

1856-O Double Eagle, AU53
Spectacular New Orleans Rarity
The Garrett and Guth, Winter and Crum Plate Coin
1856-O $20 AU53 PCGS. Variety 1. A number of factors contributed to the rarity of the 1856-O double eagle, but the survival of even negligible quantities of the issue was seemingly doomed long before the coins were actually struck. In the early days of the California Gold Rush the massive quantities of newly mined gold had to be shipped from California all the way to the mints in New Orleans and Philadelphia for coining. The most popular route, however, was long and perilous, as the payload had to be carted across the Isthmus at Panama, and the steamships that transported it to and from that point did not fare well in the violent storms that ravaged the gulf.

The solution came in the authorization of a branch mint in San Francisco. Production of gold coins commenced at that new facility in April 1854, and as a result, bullion deposits in New Orleans and Philadelphia plummeted nearly to their pre-Gold Rush levels.

For the New Orleans Mint, this shift in the work load came just in time; structural issues within the mint building, brought about by the settling of its somewhat unstable foundation (not far from the Mississippi River levee), had progressed to the point of interfering with minting procedures (Bowers, 2014). In May 1854, the Senate authorized funding for the necessary repairs which included modifications to make the building "fireproof," an improvement that would later be imparted on the Philadelphia Mint as well.

By 1856, fresh gold strikes in California were becoming few and far between, and the high-capacity San Francisco Mint was in full production, churning out more than 1 million twenty dollar pieces by the end of the year, which left little excess bullion for the New Orleans facility and significantly limited its double eagle output that year. Additionally, high production of subsidiary silver denominations beginning in 1853 (with the reduced silver weight) flooded the economy with silver to the point where gold coins were once again becoming the preferred medium. In an effort to avoid possible hoarding of gold pieces, Mint Director James Ross Snowden declared that the Mint would no longer pay out gold coins in return for silver bullion deposits as had been done in the past, but only in return for gold deposits. Though an exception was made for the San Francisco branch, this change effectively decreased the demand for, and therefore the output of, high-denomination gold coins in the South.

The resulting decline in gold coin production at New Orleans drove the double eagle production for the year down to a paltry 2,250 pieces, the lowest mintage figure not only of any O-mint double eagle, but of any Type One issue overall. As with most Southern gold issues of the period, nearly the entire mintage was placed into circulation (save for one prooflike specimen, believed to be a presentation strike), and none were apparently saved by collectors of the period. Gold specialist, Doug Winter, in Gold Coins of the New Orleans Mint, writes:

"The 1856-O is the rarest New Orleans double eagle. There are only twenty or thirty pieces known and most are in the VF25 to XF40 range. This is a very rare coin in About Uncirculated and pieces that qualify as such are generally offered for sale only when great collections are auctioned."



Winter's survival estimate is seconded by Garrett and Guth, who suggest fewer than 25 examples are known in all grades (noting that two uncertified representatives are permanently housed in the Smithsonian Institution), though PCGS CoinFacts figures the total to be as high as 40 pieces. Having compiled a roster several years ago, Heritage has been able to confirm the existence of just 23 individual coins, which reveals the former estimates to be seemingly accurate. PCGS and NGC combined have seen 22 gradable examples (14 at PCGS and 8 at NGC), a figure that obviously reflects a number of resubmissions (6/14). Winter and Crum, writing in An Insider's Guide to Collecting Type I Double Eagles, further note:

"You can be finicky when selecting an 1856 Philadelphia or San Francisco double eagle. You cannot be finicky when selecting an 1856-O. Consider any chance to purchase an 1856-O double eagle a special opportunity."



The low survival rate, besides the meager mintage and heavy circulation, is largely due to the fact that for the first half a century after its issuance, few collectors cared about mintmarks and were content to just acquire one of the more available Philadelphia or San Francisco issues, leaving the entirety of the 1856-O mintage to slowly fade away in circulation. Even when collectors began paying attention to mintmarks around the turn of the 20th century, the high face value of the double eagle still limited collector demand for the coins in general. This may account in part for the earliest auction record we can find of any 1856-O double eagle being from Thomas L. Elder's December 1933, New York sale of the John Nickerson Collection. Elder wrote of that coin (lot 1126):

"Unpriced by Raymond in his book. Ex. Rare. May be first in these sales."



By the time of the earliest recorded auction appearance of the present coin, however, in Stack's October 1968 sale of the R.L. Miles Jr. Collection, Part I, the true rarity of the issue was more widely recognized by the numismatic world, and demand was increasing. In that catalog, Stack's described this coin as:

"The Excessively Rare 1856-O Double Eagle ... The Rarest Liberty Head Double Eagle."



Today a handful of other issues are recognized as close rivals, or in the case of the 1861 Paquet Reverse, rarer, though the 1856-O remains one of the most sought-after and rarest issues in the series, with a level of collector demand that is significantly greater than early catalogers would ever have imagined. It ranks seven points higher in Garrett and Guth's 100 Greatest U.S. Coins, third edition, than its close rival, the 1854-O, and is heralded in their Encyclopedia of U.S. Gold Coins as "a 'classic.'"

This representative is among the finer-known examples, with only slight wear over the high points of the design and rich green-gold and lemon-orange patina on each side. The overall visual appeal of this piece, aided by remnants of prooflike mirroring in the protected regions, is well above-average for the issue, as most other 1856-O double eagles have been repeatedly cleaned and exhibit large detracting marks on the surfaces; a tick in the field near star 13 and a mark near Liberty's chin, however, serve as pedigree identifiers. In any condition, an 1856-O double eagle is a sought-after prize, but this piece represents a seldom found opportunity to acquire an upper-end, essentially problem-free example of this famous New Orleans rarity.
Ex: R.L. Miles Collection (Stack's, 10/1968), lot 839; Auction '88 (Akers, 7/1988), lot 975; Auction '90 (David Akers, 8/1990), lot 1951, realized $24,200; Long Beach Signature (Heritage, 2/2001), lot 7091, realized $94,875. The Winter/Crum plate coin, and the plate coin for Encyclopedia of U.S. Gold Coins by Garrett and Guth.
From The Charles G. Wright Family Collection.(Registry values: N10218) (NGC ID# 268Z, PCGS# 8918)

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