Silver Dollars: A Complete History

Silver dollars were a part of the United States coinage system from 1794 to 1999, with several lengthy breaks interspersed. The dollar unit has always been the foundation upon which the face values of all other US coins are based. In all, there are ten different types of silver dollars to collect; some don’t cost much, while others are very expensive. What follows is a brief introduction of US silver dollar types and some key date advice for collectors seeking potential for strong value increases in the future.

The first US silver dollar was the Flowing Hair type, produced in 1794 and 1795. The 1794 is a notable rarity with a record of consistent gains. The bad news is that collector demand over a long period of time has pushed the entry level price for the 1794 to at least $40,000. The good news is that the same pressure will keep the price moving higher still. All varieties of the 1795 Flowing Hair Dollar are not nearly as rare as the 1794, cost much less ($1500), and yet are good bets for higher prices down the road.

Draped Bust, Gobrecht, and Seated Liberty Silver Dollars

The Draped Bust Silver Dollar with small eagle reverse had a short lifespan also, running from 1795 to 1798. There are many interesting varieties to study as these were the days when dies were engraved by hand. This series contains a number of issues that are more easily affordable to the buying public than the Flowing Hair Dollars, although starting at $1000, they’re by no means inexpensive. There are no outstanding key dates in the group, but all have been coveted by generations of numismatists.

The large eagle reverse type of the Draped Bust motif was struck from 1798 to 1804 (the 1804 was actually a restrike made many years later, and is one of the great stories in US numismatics). The purchasing advice for the large eagle type is nearly identical to that given for its small eagle predecessor. In buying properly graded examples at current market levels ($750 minimum), there is no way a collector with an eye toward the future can go wrong with Draped Bust Silver Dollars. At the conclusion of this series, the dollar denomination entered a period of hibernation which eventually stretched to 32 years.

The Gobrecht Dollars of 1836 to 1839 are technically defined as pattern coins because they were designed in preparation for the origination of a new dollar type Congress hoped would circulated more actively than previous types. The principal action to make this possible was a reduction of the silver standard in 1837. All Gobrecht Dollars are rare and valuable and are highly desirable as collectibles. The problems most numismatists have is finding genuine examples for sale and coming up with the $12,000 minimum required to get into Gobrecht Dollars.

The Seated Liberty Silver Dollar was patterned after the Gobrecht Dollar, although the coin’s reverse was completely overhauled before its release in 1840. The Seated Liberty Dollar saw heavy circulation until its demise in 1873. There are a few spectacular rarities in this group, priced far beyond what most collectors could contemplate spending. More attainable key dates with good promise are the 1871-CC, 1872-CC, and 1873-CC. You can get into the game for around $1000 and can reasonably expect to see higher prices someday as other collectors will want what you have.

Silver Dollars in Currency

The issuance of regular silver dollars came to a standstill in 1873 with the release of the slightly larger Trade Dollar. The plan for the Trade Dollar was to make commerce easier for United States businessmen operating in the Far Ear. For years, American coins were snubbed by Oriental merchants in favor of the Mexican peso, which contained more silver than the US silver dollar. In order to compete in the region, Americans were forced to negotiate for pesos to trade with. Mexican dealers assessed extra charges to the Americans during currency swaps. The heavier Trade Dollar was supposed to eliminate the advantages the peso held over the dollar.

On the home front, Trade Dollars were approved by Congress as legal tender in transactions up to five dollars. When the price of silver dropped a few years after the Trade Dollar was introduced, the government revoked its domestic legal tender status; in other words, it was demonetized. Because there were so many Trade Dollars circulating about, widespread confusion resulted. To compound matters, the mints kept releasing new Trade Dollars upon an already confused nation. Confronted with an angry population, the government acted to suspend the production of Trade Dollars for any reason other than proof sets after 1878. Proof examples were struck each year thereafter until 1885, with the 1884 and 1885 being ultra rare. The best affordable Trade Dollar prospects for future price hikes are the proofs of 1879-1883, worth at least $3000 today.

The restoration of the regular silver dollar was provided for the passage of the Bland-Allison Act of 1878. The new type of dollar, called the Morgan Dollar, was named after its designer, George Morgan. The powerful silver mining lobby, concerned over the decreasing value of their commodity, pressured Congress into approving the Bland-Allison Act. As part of the new law, the Treasury Department was required to purchase huge amounts of silver and convert it into dollar coins, in the hope of maintaining the price of silver at high levels. Under this plan, quantities of silver dollars became so large that they far exceeded the need, resulting in millions of unused dollars piling up in bank and Treasury vaults.

The Bland-Allison Act was modified by the Sherman Silver Purchase Act of 1890. The act mandated a government purchase of 4.5 million ounces of silver each month, to be paid for with Treasury bonds redeemable either in gold or silver. Unexpectedly, most bond holders redeemed their notes in gold, depleting the Treasury’s gold reserve and throwing the entire country into a severe financial panic in 1893. The financial panic led to the repeal of the Sherman Act, which greatly slowed the production of silver dollars throughout much of the 1890’s. Coinage of the silver dollar was suspended after 1904 when the bullion supply allotted to the dollar pieces became exhausted.

Under the guidelines of the Pittman Act of 1918, over 270 million silver dollars were melted down for export and recoinage into smaller coins. The big meltdown explains why some of the Morgan dollars with reported mintages of over a million pieces are so scarce today. Some of the silver derived from the Pittman Act was used in the production of the 1921 dollars, the final year for the Morgan Dollar.

Morgan Dollars have been a major force in the numismatic market for a very long time, and still seem to be on everyone’s “Want List”. Too many inexperienced coin buyers end up disappointed when they purchase Morgan Dollars but then fail to see nice rates of return. That’s because they didn’t focus their efforts on acquiring key date Morgan Dollars. Most Morgan Dollars are fairly common whose lower grade prices are influenced by the prevailing silver market price. On the other hand, key dates have historically gained in value much faster than the common dates and don’t rise and fall with the silver spot price. Some of the Morgan Dollar dates to watch for include all issues from the “Wild West” mint at Carson City, 1893-S, 1894, 1895, 1895-S, and 1903-O. Of course, price varies greatly dependent upon date and condition, but a few hundred dollars is all it takes to get off and running.

The Peace Dollar type was commenced in 1921, the same year the Morgan Dollar was put to rest. The new dollar was belatedly issued to celebrate the end of the Great War (later renamed World War I) and dedicated to the ideal of a just and lasting peace worldwide. Production of the Peace Dollar continued until 1928, when it was suspended because of lack of demand.

More Peace Dollars were struck in 1934 to help eliminate war debt accounts, but a law passed later in the year stated that paper Silver Certificates should be backed by “one dollar in silver” rather than “one silver dollar”, as in the past. The Silver Act of 1934, as the new law was called, ended any further need for silver dollars. After the 1935 silver dollars were released, the Peace Dollar series drew to a close. The rare Peace Dollar dates of most interest to collectors are the 1921 and 1928. Expect to pay no less than $125 and $400, respectively.

The End, and Resurrection of the Silver Dollar

Silver dollar production was resumed in 1971 with the Eisenhower, or “Ike” Dollar. “Metallic” dollar is a more accurate description of an Eisenhower Dollar since all of them struck for circulation were composed of the familiar copper-nickel “clad” alloy in use since 1965. The last Eisenhower Dollar was released in 1978, making it one of the shortest series of American coins. All dates exist in abundance, but Uncirculated examples grading MS-67 and higher have proven to be few and far between. Valued at $3000 each (give or take $1500) for the 1973, 1974, 1974-D, 1978, and 1978-D, these high grade Ikes have certainly won the respect of numismatists.

The ill-fated Susan B. Anthony Dollar was minted only from 1979 to 1981, and then again in 1999. After what seemed like a good idea, the government halted production following objections the coin too closely resembled the size of the quarter. The main factor, however, in the failure of the Anthony Dollar to circulate was the public’s preference for the one dollar paper bill. As a result, hundreds of millions of “Susie B’s” languished in government vaults for many years.

The reason the Anthony Dollar was resurrected in 1999 was because the stockpile had been slowly evaporating for a number of years due to a new demand generated by modern vending machines. The Sacagawea “gold” dollar was on the drawing board for year 2000, but the Treasury Department was concerned there wouldn’t be enough Anthony Dollars in storage to stretch out until the release of the Sacagawea Dollars. The encore performance led to nearly 40 million Anthony Dollars minted in 1999. Collectors pay scant attention to the Anthony Dollar. In recent years, high grade MS-67 examples have actually decline in value.

Tips When Buying Silver Dollars

Here is an important piece of advice: Never pay big money for a rare US silver dollar (or any coin for that matter) if you’re not sure it has been graded properly. Too many collectors get burned when they buy over graded coins and then later try to sell. Fortunately, there are several third party grading services that inspire confidence among buyers and sellers.

The grading services with the best reputation are PCGS, NGC, ICG, and ANACS. You can feel good about purchasing, for example, an 1893-S Morgan Dollar in F-12 condition in a PCGS holder. Someday a potential buyer for your coin will feel the same way.

Written by numismatic expert Daniel J. Goevert.

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