The Great Silver Dollar Hoards
— Danny Freeman
Perhaps no other United States coin ever made stirs the human imagination more than the silver dollar. Images of the old west, poker tables, saloons, and bank robbers all come to mind when the silver dollar is the subject of discussion. This is part 3 of a series that examines the “Hoards” of dollars that have become famous and are known to the collector.
The U.S. Treasury/ GSA Hoard
Until early 1964, the U.S. Treasury and the Federal Reserve kept large amounts of silver dollars in reserve for any member bank who wanted to order them. Their primary purpose was to be available for anyone who wanted to redeem a “silver certificate” for a silver dollar. In late 1962, during a routine audit, the treasury discovered large quantities of “rare dates such as the 1903-O, and a number of Carson City dates” (the 1903-O was the most valuable silver dollar until this discovery, selling for much more than a 1893-S or any of the key date Carson City coins.) The coin collecting community and a large number of investors took advantage of this situation and started “crashing the banks” with requests to redeem silver certificates for the coins. After a year and a half of the feeding frenzy, in March of 1964, the Secretary of the Treasury, C. Douglas Dillon halted the exchange of the silver dollars. He ordered that the public could still redeem their paper silver certificates for silver bars or granules. (I can remember to this day my mother taking me downtown to the post office where I redeemed a silver certificate for a tiny glass vial of silver granules. This practice would also cease in 1968.)
The U.S. Treasury then began an intensive audit of their silver dollar holdings. The remaining holdings would tally to about 3,000 bags or 3 million silver dollars. Almost all of the coins left were from the Carson City Mint. The coins would lay dormant in treasury vaults for many years while the politicians and the bureaucrats decided what to do with them. Finally, in December of 1970, President Richard Nixon signed a bill allowing the dollars to be sold. The GSA (General Services Administration) was appointed to organize and conduct the sales. They would receive the coins a year later, and nearly another year would go by before the GSA was ready for the first sale. A series of five mail-bid sales were held beginning in October of 1972 and ending in June of 1974.
An audit after the sales would reveal that almost one million of the Carson City dollars remained unsold. Once again the coins would collect dust in government vaults until March of 1979 when President Jimmy Carter signed a bill authorizing that the remaining coins could be sold. In late 1979 the GSA announced the bidding process to the public with minimum bid prices. A few months later the GSA would have to “retract” the minimum bid prices due to the volatile silver market. The Hunt brothers, runaway inflation, and rising interest rates had driven the silver market to all-time highs. Bidders had to call a toll free number to get up to the minute minimum bid amounts and were limited to 35 coins, after being told earlier they could buy up to 500. The public was not pleased; and congressional hearings were held, and the GSA was “slammed” by the politicians.
For many years dealers would take the coins out of the GSA holders and submit them to PCGS, NGC, and others to get them graded and also because the large plastic holders were not easy to store. Today the grading services tag the original holders with their assigned grade. GSA holders with the original cards and boxes now bring a premium over a “slabbed” coin.
So, to sum it up, it took the government from 1964 until 1980 to get something that should have been simple done. Sound familiar? In our next series, we will begin with the Redfield Hoard.
Wall Street Journal
U.S. Government/General Services Administration