Q. David Bowers
Introduction
An overview of the commemorative market of past decades may be of interest to readers. In my own activities as a rare coin dealer I have learned much from those who have gone before, from the philosophies and actions of dealers, collectors, and others of long ago. "Those who do not learn the lessons of history are condemned to repeat its mistakes," Santayana observed, and this aphorism is certainly relevant to coins. "The more things change, the more they stay the same," as I noted earlier.
I suggest that anyone who takes the time to read this book in detail will be in an excellent position to avoid the mistakes that have cost investors a lot of money in the past. Much of the world of commemoratives has been characterized by hype of the old-fashioned P.T. Barnum type. This started years ago with the issuing commissions themselves, when the promoters of this commemorative half dollar or that one found that statements such as "we are almost sold out," "we expect to be sold out in the first week," "we will raise the price next month on any left-over coins," "these will become very rare," etc., influenced many people and helped move merchandise. As you read excerpts from original correspondence, congressional testimony, advertisements, etc., under the specific commemorative issues described in this book, you may be surprised (and, if you have faith in the good side of human nature, disappointed) to learn that many seemingly well respected individuals were in fact liars when it came to statements used in commemorative coin promotions, particularly in the sales efforts of the 1930s.
Of course, some issues were sold out quickly and rose in price rapidly; but, in general, the more an issue was subjected to advertising puffery, the less were the actual benefits and profits to collectors and investors. By reading about what happened in the commemorative market over a long span of years , you will see that history has repeated itself numerous times (and will probably continue to do so). Everything becomes more understandable.
The commemorative market did not develop on a widespread basis until the 1930s. However, there was still a lot of activity before then. The present study begins with the year 1895.
The Commemorative Market in 1895
There really wasn't an active market for commemoratives in 1895. The only silver commemorative coins that had been minted to this point were the 1892 and 1893 Columbian half dollars, which were available from circulation (or from dealers for just a slight handling charge above face value), and the 1893 Isabella quarter dollar, which could be bought for scarcely more than its issue price of $1. The 1848 CAL. quarter eagle, truly the first coin in the commemorative series, was noticed by only a few numismatists, for collecting gold coins (except for Philadelphia Mint Proofs) would not become popular until many years later.
The Commemorative Market 1896-1900
The market in 1900 wasn't much different from that of 1895, and only one new issue had been produced in the meantime, on December 14, 1899, when 1900-dated Lafayette silver dollars were struck. The price of Isabella quarters had risen slightly, whereas Columbian half dollars remained plentiful in circulation. Commemoratives were so unimportant that very little was said about collecting them in the pages of the two leading publications of the day, The Numismatist (official monthly journal of the American Numismatic Association) and the American Journal of Numismatics (quarterly journal of the American Numismatic and Archaeological Society).
The market for commemoratives was just beginning to exist by 1905, and it wasn't a very auspicious start. Columbian half dollars and Isabella quarters were available inexpensively and, presumably, every collector of United States coins wanted one of each, but the 1900 Lafayette silver dollar was generally ignored (why, I don't know).
The first gold commemoratives, the 1903-dated Louisiana Purchase Exposition gold dollars, minted in two varieties (bearing the portraits of Jefferson and McKinley), were a drug on the market. Farran Zerbe, a numismatic entrepreneur (and the first of many individuals who would profit from or exploit commemoratives), was in charge of distributing these gold dollars. By means of optimistic news releases and articles published in The Numismatist, by advertisements, and by an exhibit at the Exposition itself, he succeeded in selling quite a few of these, probably over 10,000, for $3 each.
There were a few problems, however: First, although he had persuaded the government to mint 250,000 of the little things, after the fair had closed over 200,000 remained unsold. Worse yet, the market dropped, and in the aftermarket they could be bought for about a third less than the issue price. This brought howls of resentment from collectors who felt they had been cheated. When a new issue of commemoratives was created, the 1904 and 1905 Lewis and Clark Exposition gold dollars, also under the auspices of Farran Zerbe, the general reaction of numismatists was, "No thank you."
The Commemorative Market 1906-1910
Not much was going on in the commemorative market in 1910 (except that the furor about the 1903-dated Louisiana Purchase Exposition gold dollar debacle had died down), and by now Farran Zerbe had served two years as president of the American Numismatic Association.
Nearly all dealers maintained stocks of the 1892-1893 Columbian half dollars and the 1893 Isabella quarter, offering them for sale for slightly over face value. For the 1893 Isabella quarter there would be no standard market price during the five-year period ending in 1910. While earlier in the decade most dealers were charging $1 or more for this coin (which had been issued for $1 at the World's Columbian Exposition), by the end of 1910 the market level had dropped to the 65¢ to 80¢ range. In the meantime 1903-dated Louisiana Purchase Exposition gold dollars continued to be available for less than the $3 issue price.
Curiously, the 1904 and 1905 Lewis and Clark Exposition gold dollars were generally ignored by dealers, who had few in stock and seldom listed them for sale. It was almost as if Lewis and Clark gold dollars didn't exist. 1900-dated Lafayette silver dollars also were widely overlooked.
In numismatics nothing dampens enthusiasm more than a price drop, and, conversely, nothing spurs collectors to take out their wallets and checkbooks more than a price rise. More than just about any other area within American numismatics, the commemorative market has always had a high degree of emotion attached to it. If a coin is perceived as a good investment, it becomes "hot," and many buyers desire it. If a coin has recently dropped in value or seems to be going nowhere price-wise, buyers are fewer. In the meantime dedicated collectors keep collecting, but investors come and go. By 1910 the commemorative market looked like anything but a good investment. Apathy was the order of the day.