The Silver Dollars of 1878-1935, Part Two

Posted on 2/15/2008

David Lange shares some more surprising revelations about Morgan and Peace dollars (including why the most worn coins don’t come from the mints you might expect).

Though the survival rate of uncirculated Morgan and Peace dollars is disproportionately high when compared to other United States coins of the same period, there’s no disputing that the cartwheels did circulate. There are countless worn pieces to prove it. Anyone who collects this series will come to learn, however, that the distribution of worn versus unworn coins is not at all balanced. Certain dates are often found heavily worn, while others are nearly unknown in anything less than About Uncirculated condition. Certain patterns emerge as one studies this distribution, and these include a few surprising results.

Given that silver dollars were most likely to circulate in the West, where paper money was not in general usage before World War I, it’s natural to assume that most of the heavily worn silver dollars would carry “S” or “CC” mintmarks. Surprisingly, among the silver dollars most often seen uncirculated are the San Francisco Mint coins of 1878-82 and the Carson City Mint dollars of 1878-85. Those that did enter circulation seemed to have stayed there for decades, so collectors have a broad range of grades for these issues.

One would expect the silver dollars coined at Philadelphia to all be pristine, since there was little circulation of silver dollars in the Northeast, yet dates such as 1878 through 1886 are readily found worn. Other Philadelphia issues, 1897 being an example, are rarely seen with any but the lightest wear. In the Peace series, dates that are common uncirculated but rare in well-worn condition include the “P” Mint dollars of 1925-27.

The real surprise is how many New Orleans silver dollars are quite heavily worn. This applies to nearly every “O” Mint dollar in the series, with the notable exceptions of 1898, 1903, and 1904. These three dates were very rare uncirculated until numerous bags of each began to surface among the silver dollars being distributed by the U.S. Treasury in 1962. This set off a mad dash by speculators to buy as many bags of Treasury silver dollars as possible, until their distribution was cut off altogether in March of 1964.

That episode explains in a nutshell why the degree of wear found on silver dollars has little to do with their mint of origin. Being mostly unneeded at the time of their striking, silver dollars were stored wherever space could be found for them, and they were periodically moved to other locations. When a regional demand appeared for silver dollars, such as at the December holiday season, the coins distributed to banks in a particular area may have come from any one of five mints. This is in contrast to the more useful denominations of coins that were typically distributed within the region served by a specific mint. There was no rhyme or reason when it came to which date/mint combinations were released to circulation. They also were not released on a first-in, first-out basis. Thus, now common issues such as 1923(P) and 1925(P) were once considered key dates in the Peace dollar series until many bags of them were released during the 1940s. It’s fun to look through old numismatic magazines to see how the perceived rarity and value of each issue changed in response to the latest releases.

The typical circulation of a silver dollar in the East and Midwest was quite brief. Usually given as a holiday or birthday gift, a fresh, uncirculated silver dollar may have been carried around for a few weeks before being spent, whereupon it immediately went to the bank with that day’s receipts and then languished in storage for years more.

In the West, however, silver dollars were actually used in daily circulation. I know this from firsthand accounts provided me by my mother, who used to find the receiving of silver dollars in change from the grocery store quite a nuisance during the 1950s. Silver dollars were even more common in the rural West, but they were most prevalent in the gambling casinos of Nevada. There they survived in daily use until 1964-65, when customers ceased cashing them in at the end of play and simply took them home. The casinos attempted to discourage such hoarding by filing off the dates of their dollars, but this short-lived practice couldn’t change people’s perceptions that the coins would soon be worth more than face value. Of course, this is exactly what happened, as their silver value quickly exceeded one dollar.

Among the more unusual items that collectors may encounter are silver dollars having round stickers of varying sizes applied to them. In most instances, these are advertising pieces and the stickers describe some local business. This was a more economical alternative to the older practice of counterstamping coins with the name of a particular product or business establishment. Another reason for applying stickers to silver dollars was to reveal the impact of a particular industry on the local economy. A large employer would pay its workers in silver dollars marked with the company’s name so that merchants and politicians would be impressed by how much money was being spent by that block of employees. Less often seen are dollars that have had similar messages applied to them with colored ink.

David W. Lange's column, “USA Coin Album,” appears monthly in Numismatist, the official publication of the American Numismatic Association