A couple of reasons gold dollars did not circulate 0

[RWB]

Some reasons for gold dollars not circulating freely. [See RG104 entry 216 vol. 19 available from the Newman Numismatic Portal.]

 

Mint of the United States, Philadelphia

January 11, 1859

Hon. Howell Cobb, Secretary of the Treasury

Washington City

Sir,

As requested in your favor of the 8th inst., I have considered the letter of the Asst. Treas. at New Orleans in regard to the circulation of gold dollars at that city. From the reasons stated by Mr. Guirot, the Asst. Treas., it is advisable that you should direct the Asst. Treas. at New York not to send gold dollars to New Orleans as they have a superabundance of that coinage on hand.

The discrediting of this coin by the banks is one of the faults of our [present] banking system. Whenever small notes are issued or circulated, the efforts of the banks are directed against the circulation of such of the coins of the United States as conflict with their notes. And I am sorry to say that government officers are very much disposed to avoid the labor of counting small coins, and hence to encourage the use of the double eagle only because it suits their personal convenience best.

At New York both these causes have led to the accumulation of a large amount of gold dollars in the Assistant Treasury. As we have no power to apply remedies against the ills of small note circulation, we must necessarily suit our coinage to the actual demand of depositors. The last years, the whole coinage of gold dollars at all the mints amounted only to $230,000. I will continue to restrict the coinage of other denominations to the actual demand. At present we have at the mint only $10,000, and in the Asst. Treasury here, $4,000.

I have the honor to be,

With great respect,

Your obedient servant

James Ross Snowden

Director of the Mint

Edited September 7, 2019 by RWB
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[Revenant]

The $1 bill, the mortal enemy of $1 coins since the 1850s.

[jgenn]

The underlying reason contributes to why there were mostly trade dollars vs trade 1/2 dollars or trade 1/4 dollars.  It may be the same amount of precious metal but the labor to count or assay is 2x or 4x, respectively.

[Just Bob]

When coins of all denominations disappeared just a few short years later, I imagine the people (and banks, and government officers) of New Orleans were wishing that they had not had their supplies of gold coins reduced.

Good info, Mr Burdette, as always.

[LINCOLNMAN]

These coins are awfully small and must have been frequently lost. $1.00 was a lot of money back then. Was that a factor?  

[Revenant]

4 hours ago, LINCOLNMAN said:

These coins are awfully small and must have been frequently lost. $1.00 was a lot of money back then. Was that a factor?  

That's one of the reasons I used to hear years ago.

Of course:

They try to fix it with silver dollars and people reject it for being too heavy.

They tried to fix that with the SBA dollar and people rejected them because they were confusing them with quarters.

They tried fixing it by making the SACs and the presidential dollars, and people just still wouldn't use 'em.

They worked in Europe and the UK because the small notes went away.

[Conder101]

On 9/7/2019 at 10:08 PM, jgenn said:

It may be the same amount of precious metal but the labor to count or assay is 2x or 4x, respectively.

So is the labor to make them.  That was one reason why in the early US Mint the mint encouraged depositors to take larger coins rather than the smaller denominations.  It took 5 times as much labor to make a dollars worth of dimes than a dollars worth of half dollars.  When you are using muscle power to swing the press it makes a difference.

[jgenn]

On 9/10/2019 at 10:56 PM, Conder101 said:

So is the labor to make them.  That was one reason why in the early US Mint the mint encouraged depositors to take larger coins rather than the smaller denominations.  It took 5 times as much labor to make a dollars worth of dimes than a dollars worth of half dollars.  When you are using muscle power to swing the press it makes a difference.

So when did this extend to dollars? My understanding, from a quote by John L Riddle, melter and refiner at the New Orleans mint, in his "Monograph of the Silver Dollar, Good and Bad", 1845, was that "The policy of our government has been to issue a great preponderance of halves, and the smaller denominations of coins, under the impression that they would be less likely to be exported from the country."

[CaptHenway]

On 9/16/2019 at 8:36 PM, jgenn said:

So when did this extend to dollars? My understanding, from a quote by John L Riddle, melter and refiner at the New Orleans mint, in his "Monograph of the Silver Dollar, Good and Bad", 1845, was that "The policy of our government has been to issue a great preponderance of halves, and the smaller denominations of coins, under the impression that they would be less likely to be exported from the country."

That makes sense, but logic is not always so. 

[DWLange]

In its early decades the Mint always pushed the highest denominations to get credit for as much dollar value as it could. This looked good in the annual reports, satisfied congress and, as indicated above, was much less work for the staff and for banks in counting. To remedy the situation, early Mint officers who truly cared about making its products of use to the general public would sometimes deposit silver themselves, requesting to be paid in dimes or half dimes. Third Mint Director Elias Boudinot was one who did that.

[RWB]

The first New Orleans coins were dime and half dimes. These were made in response to local demand for small change. The Mint Director wanted to show Congress production in face value not pieces, and pressured the Superintendent and coiner to switch to halves as soon as possible.

 

There'll be a small Coin World article about this soon.

[Zebo]

Can't wait to read it - thanks

[RWB]

RE: " They tried to fix that with the SBA dollar and people rejected them because they were confusing them with quarters. "

This was a really foolish decision. It was "imposed" by US vending equipment manufacturers so they did not need to change the gauge slot in their machines. The SBA dimensions were fixed before anything else and changed only once in the entire review process - even then it was a slight enlargement of diameter.

 

My opinion is that if the SBA dollar had been the diameter of the old gold eagle, it might have been successful with consumers. Today, a dollar purchase is as likely to be made with credit or debit cards as cash.