Spectacular and Rare 1891 Proof Double Eagle, NGC Proof 68 Ultra Cameo1891 $20 PR68 Deep Cameo NGC. This coin is the single finest known example of any proof Liberty double eagle of any date certified at either NGC or PCGS. Besides its phenomenal condition, this is an exceedingly rare date, with a total mintage of 1,390 business strikes and 52 proofs. Q. David Bowers' A Guide Book of Double Eagle Gold Coins notes that this date "has long been recognized as a rarity in any grade." The history of bimetallism (or the lack thereof) and its relationship to the present coin is worth exploration. In 1837 the U.S. government pegged the ratio of gold to silver at 16 to 1. During the War Between the States (1861-1865), little silver was mined, and there were no major discoveries of the metal. An immediate consequence of the aftermath of the Civil War had to do with the circulation of $450 million in "greenback" notes that were unbacked by gold or silver reserves. Farmers and other debtors supported the issuance of increased numbers of greenbacks, which would spur inflation and lessen in absolute terms their ultimate debt repayments. Farmers supported inflation because they incurred debts in the spring and discharged them in the fall. Lenders and the wealthy, on the other hand, wanted to eliminate the circulating greenbacks and to return to a gold-backed currency, which would reduce inflation and ensure that they were paid, or repaid, in "hard currency." In 1873, silver was demonetized and the nation adopted the gold standard, leading the farmers and debtors to band together with Western silver-mining interests to rally against what they termed the "Crime of '73." By 1877 debate raged regarding "Free Silver," with advocates, generally Western silver miners and the aforementioned debtors, endorsing the unlimited coinage of silver dollars, while Easterners and creditors generally preferred gold's stability. The "Free Silver" forces won a partial victory with the 1878 passage of the "fatally stupid" Bland-Allison Act, as Walter Breen called it. The Bland-Allison Act required the U.S. Treasury to buy between two million and four million dollars' worth of silver bullion monthly at market prices to be coined into silver dollars, which were made legal tender for all debts, even though there were no demands for such coins in commerce. Indeed, millions of Mint State silver dollars went into bank vaults in bags, there to remain for decades. However, despite passage of the Bland-Allison Act the government notes were still backed only by gold. True bimetallism would have backed the notes with either metal, ratios fixed and predetermined by the government. The Bland-Allison Act heightened overseas fears that the nation might eventually abandon the gold standard. In the early 1880s farm prosperity lessened the urgency of "Free Silver," but in 1887 a downturn in the agrarian economy again brought the issue to the fore, with farmers and miners demanding a return to bimetallism and unlimited silver coinage at the previous ratio of 16 to 1.
Those Western silver interests were stronger than before, with the addition to the Union in 1889 and 1890 of North Dakota, South Dakota, Montana, Washington, Idaho, and Wyoming, in that order. The Sherman Silver Purchase Act, passed in 1890, not only required the government to purchase more silver than ever before in amounts that nearly equaled the Western silver mines' entire output, but it also greatly increased the amount of currency in circulation. Against this backdrop of ever-increasing silver dollar output for more than a decade, European bankers and private creditors became increasingly fearful that the United States might abandon the gold standard, thus eliminating the possibility of debt repayments in gold coins or bars. While central banks preferred gold bars, private banks and merchants preferred gold coins, specifically double eagles, which contained a known quantity of gold. The gold content of bars could be determined only by independent assay. (While domestic accounts could mostly be settled with paper currency or gold or silver, international commerce largely demanded hard currency). All this uncertainty regarding the United States' commitment to gold versus silver meant that for many years in the 1870s through the 1890s, and continuing until 1900, when the nation again adopted the gold standard, there were enormous net outflows of gold bars and double eagles outside of the country.
All of this history does much to explain why this particular date is so rare, both as a business strike and as a proof. But besides macroeconomic issues unique to 1891, there were also microeconomic ones at play: twenty dollars was a lot of money in 1891, and two years later, during the Panic of 1893 when times got harder, it was even more money. Perhaps a significant portion of the original proof mintage was spent for one reason or another. There are certain diagnostics that distinguish proofs from business strikes. The date on proofs is higher than on business strikes, and level, while on business strikes it slants downward slightly. The rays below TE on the reverse are thinner than the other rays.
This example, as the grade suggests, is virtually flawless. Every hair on Liberty's head is sculptural in detail. The problem-free devices have heavy frost that provides a startling black-on-gold contrast against the profoundly deep and incredibly pristine fields. Lengthy scrutiny under a 16x magnifier reveals only a tiny reverse round dot indentation to the right of the topmost serif of the F in OF. Not only is this coin the highest graded at either NGC or PCGS, its appeal is so phenomenal that NGC has awarded its most coveted "Star" designation to this example, and quite a star it is. NGC has graded a total of 22 proof examples, with this being the highest graded specimen, followed by one coin in Proof 67. PCGS has graded a total of 21 proof specimens, the highest being a Proof 66 Deep Cameo. Both of those figures assuredly include numerous resubmissions and crossovers (11/05).
From The Clausen Family Collection.(Registry values: P3) (NGC ID# 26EC, PCGS# 99107)
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