from NUMISMATIC NEWS magazine March 4, 2003
Written by Weimar W. White
Collectors of Morgan Carson City dollars often wonder why MS-65 specimens of two dates are relatively expensive when the General Services Administration in the 1970s sold 3,949 1890-CC and 5,687 1891 -CC silver dollars to the public. Most of these coins were in uncirculated condition but were heavily bag marked from being moved around from one location to another in bags each containing 1,000 coins.
The Redfield estate (1976) also had several bags of uncirculated examples of these two dates, which were sold to collectors. They also were generally heavily bag marked.
One can purchase MS-60 examples of these two dates for about $325 each in today market. However, the price is significantly higher for MS-64 specimens, i.e., about $925 for an 1890-CC and around $625 for an 1891 -CC dollar. However, the big jump in price occurs when just one grade point higher is desired. An 1890-CC in MS-65 will cost a potential buyer about $6,750 and about $3.000 for an 1891-CC in the same grade.
The big jump in price is because these gem dollars are scarce and there are many collectors of Carson City dollars who want virtually bag mark free specimens. Just how scarce are these gem dollars? The writer estimates that only 265 +/- 40 MS-65 or higher 1890-CC dollars are available to collectors. By comparison, the 1891-CC dollar in MS-65 or higher are somewhat more available and I estimate approximately 500 +/- 70 exist. No wonder collectors will pay $3,000 for a gem.
The 1890-CC dollar in deep mirror prooflike MS-65 is a rare coin, but can be purchased for around $8,500.
Surprisingly, the 1891 -CC dollar is even rarer than the 1890-CC with mirror surfaces. A prooflike example of an 1891-CC dollar in MS-68 sold at auction in 2000 for $86,250!
The 1890-CC and 1891-CC dollars in certified MS-65 showcased in this article show no toning and have full mint luster with lots of cartwheel spin as evidenced when the coins are rotated. They look like they were just minted.
For those collectors who enjoy seeing their coins appreciate in value, let’s go back to 1932. B. Max Mehl, a well known dealer during this period, placed no premium on either of them in that year. Even in 1959, Red Book values for these two dates in uncirculated condition are listed as only $4.50 each.
If your dad gave you an 1890-CC dollar in gem condition that he acquired in 1932, the average annual rate of appreciation to date in nominal dollars would be13.22 pecent per year. For the 1891-CC dollar, if also acquired then, the average rate of return would be 11.94 percent per year.
If a collector had purchased these two dollars in gem condition in 1959 for $4.50 each, his average annual rate of return to date would be 18.08 percent per year and 15.93 percent per year, respectively.
Even after one factors out an average of 4.2 percent per year due to price inflation, the real return for these two dollars since 1959 is still in double digits per year. As such, the ownership of these two gem coins can be rewarding psychologically and financially as the data clearly shows.
While most collectors would collect for its own sake, reinforcing that behavior with solid investment performance by the coins they own doesn’t hurt either.
The most significant aspect to this price performance is that it is for coins that could have been acquired by an average collector in 1932 or 1959, or even from the General Services Administration sales in the 1970s.
Would you have purchased such high-grade pieces at any of those time periods, considering the state of grading of those past hobby eras, or the randomness of the government sale process? Perhaps not. But that is a part of collecting as well. Developing an eye for quality before others do certainly helps improve a collector’s chance to obtain something that will perform well in the future.