Numismatics: History as Market

Most people call it “coin collecting” but numismatics is the art and science that studies the forms and uses of money. This includes stock certificates, bank drafts, military decorations and fine art medals as well as coins, which, after 2500 years, are still the most common form of money. “Coins are history you can hold in your hand,” is a common saying in numismatics.  You can own a coin struck by Philip II of Macedon and believe within reason that it might have been given to Aristotle.

 

Miletos 1/12 stater: lifetime of Thales
(0.9 cm; 1.1 grams)

Back in the 1990s, inspired by the episode “Backbone of the Night” from Carl Sagan’s Cosmos broadcasts, I assembled about 25 ancient coins from the towns and times of famous philosophers, from Thales to Hypatia. Except for the Owl of Athens and a tetradrachm from Alexandria in Egypt, none cost more than $200 and most cost less than $100 at the time.

Middlesex DH 1033a:
Sir Isaac Newton
Half Penny Token

The political leaders of the American Revolution who signed the Declaration of Independence, the Articles of Confederation and the Constitution, also signed paper money. Many of these are available in middle collector grades, Very Good to Very Fine, for less than $500, sometimes surprising less.

During the late 1700s and early 1800s, the British royal treasury was nearly empty, yet the benefits of capitalism were everywhere. Taverns and merchants issued their own bronze penny and halfpenny tokens. Hundreds of types and thousands of varieties are known. Many of them celebrate trade, commerce, peace, and prosperity.

Reverse of DH 1033a
about the size of a
US Quarter

In America, from about 1834 to about 1844, a series of economic changes brought “hard times” and Hard Times Tokens. These privately minted coins stand out as being pointedly political, for or against Jackson, Van Buren or Daniel Webster. There were even Abolitionist tokens. These all circulated in daily trade. Many are also advertising cards, for instance for Van Nostrand, which then was only a bookstore in New York.

 

Canadian tokens of the 1840s were part of the social fabric that led to The Rebellions and ultimately to the burning of the Parliament at Montreal. Other Canadian tokens from the Maritime Provinces explicitly honor Trade and Commerce, and state “Pure Copper is Preferable to Paper,” and assert, “More Trade, Fewer Taxes.” 

During the early 19th century, private banks in America often displayed vignettes of Spanish and Mexican coins.  Promising to pay "25 cents" or "50 cents" the pictures would be of one- and two-reales coins.  (See Spanish Coins on American Notes here.)

Stock certificates from the Edison Companies are always in greater demand, and certificates from the mid-1800s cost much more than those from the early 20th century. However, the Erie Railroad, the New York Central, Bethlehem Steel, and the many Edison Electric companies left us legacies that are very affordable. 

Numismatics is one of the last unregulated markets. In the USA, no government licenses or special regulations exist to define who is a numismatist.  (Specific laws do define “coins” and otherwise regulate the creation and production of money objects and money substitutes.)  The very few college courses in numismatics on American campuses are fleeting at best, though in Europe such studies are recognized. In this market, anyone can claim to be anything. Validation, such as it is, is by ad hoc standards of conduct set within the hobby by private organizations: the American Numismatic Society, the American Numismatic Association, the International Association of Professional Numismatists, and the Professional Numismatists Guild. These groups set standards far above any government laws. For instance an ANA dealer can be banned from membership for selling a single counterfeit item, and ignorance is not an excuse.

Realize that even among the oldest known examples, few types of coins are objectively rare. In fact, demand drives price.  So, an ancient Roman coin, known only from a museum catalog, will be dirt cheap compared to a so-called “rare” American coin with a certified population in the tens of thousands.  Coins, stock certificates, bank drafts, and other monetary media always were  intended to be common. Coins are easily the most common artifact of any civilization - and even so-called "primitive" societies have objects of social status that serve some of the purposes of money. 

We have a slogan in numismatics: Buy the book before you buy the coin. It is a general warning that this is a hobby where knowledge and money are identical. Numismatics is a hobby that actively rewards greed. 

If you have a passion for a time and place in history, such as the American Revolution or the Golden Age of Athens, you will enjoy your acquisitions - but you may not find another buyer later.  In a previous generation, most American collectors accumulated circulating American coins.   Today, collectors tend to become specialists. 

The American Numismatic Association offers two sequential week-long seminars on its Colorado Springs campus. They also provide a range of self-study materials; and they grant a master’s certificate in numismatics.  Numismatists are autodidacts.

My interest, of course, goes back to reading Atlas Shrugged as a teenager.  But it was not until 30 years later that I became active in the hobby.  I wrote magazine articles and then joined Coin World as their international editor for a year.  After that, I stopped collecting entirely, sold off my inventory, and focused on research and reporting.  (See Forgery and Fraud in Numismatics here on Necessary Facts.)

I have been editor and webmaster for the Michigan State Numismatic Society (2004-2011) and for seven years (2003-2010), I wrote the “Internet Connections” column for The Numismatist.  Below are some of the trusted resources that will help you find your own interests in this huge, unregulated market for the material artifacts of trade and commerce.

The American Numismatic Association was founded in 1891, and chartered by Congress in 1912.  Congress declared the charter permanent in 1962.  At semi-annual ANA conventions, about 300 dealers from around the world come to meet several thousand collectors.  You also will find sales booths for private and government mints from around the world, as well as educational seminars, museum-quality educational displays and judged exhibits, various auctions, and nightly awards dinners and celebratory parties.  You can find local member dealers via the ANA website.

The American Numismatic Society  was founded in 1859 and is considered the more scholarly of the two national American organizations. The ANS is focused closely on colonial and early republic American coins and paper money, ancient coins, and similar topics. 

Eugen Böhm-Bawerk founder of Austrian economics

• The Wildwinds database of auctions of ancient coins is highly regarded.
• Coin Archives posts auction results for a small group of dealers in ancient and world coins.  These firms are members of the Professional Numismatists Guild, the ANA, and other similar societies.
• The International Banknote Society  provides a very active resource for hobbyists.
• The VCoins dealer ring was founded over ten years ago to overcome the distressing lack of trustworthy online auctions.  Their dealers are typically members of other professional societies as well.

For several years, Clinton Hollins ran classified ads selling 100 different stock certificates for $55.  After he passed, his wife took over the business.  They also sold the standard catalog for American stocks and bonds.  Scripophily is the formal name for the study of stocks, bonds, and fiduciary instruments; and specialty clubs and other resources are out there.  Find the Professional Scripophily Trade Association here. 

• Whitman Publishing  https://www.whitman.com/store
• Krause Books http://www.krausebooks.com/
• Amos Press http://www.amospress.com/
• Stanton Publishing http://www.stantonbooks.com/
• Coin World newspaper (Amos Press)  http://www.coinworld.com/
• Numismatic News (Krause Books)  http://www.numismaticnews.net/

These discussion boards are trusted places for new and experienced collectors to share information, news, and gossip.  

• Coin Talk: http://www.cointalk.com/
• Coin People: http://www.coinpeople.com/
• Numis Society: http://numissociety.com/
• Coins are Fun http://www.coinsarefun.com/

 (This article was based on a similar post for Rebirth of Reason website, Monday March 21, 2005.)

Also on Necessary Facts

Forgery and Fraud in Numismatics 

Numismatics Informs Economics 

Numismatics: the Standard of Proof in Economics

Murray Rothbard: Fraud or Faker?

Money is Speech 

Money as Speech and Peacemaking 

To Make Money 

Objectivism and the Gold Standard 

Forgery and Fraud in Numismatics

“How the West was Faked” is the title of a series of websites (none active) created by John Kleeberg and Theodore V. Buttrey Jr. Broadly, they condemn the forgeries and frauds committed by John J. Ford (1924-2005) and Paul G. Franklin (1919-2000) in the 1950s and 1960s, and extended into our time. Kleeberg and Buttrey are careful; and the narrative is compelling. What follows here is my own summary based on my own experiences touching on that story.

John J. Ford
from BiddlesBank.com

John J. Ford was respected within the numismatic community by just about everyone -- except Eric P. Newman.  Ford started at New York City coin shops as a youngster. After World War II and through the 1960s, Ford worked at New Netherlands and is cited as a founding member of the Numismatic Bibliomania Society at the ANA convention at Cincinnati in 1980.  Eric P. Newman served as president of the American Numismatic Society. He is the author and co-author of several important books and many significant papers, including of Early Paper Money of America, the standard reference on fiat currency of the American Revolution. Newman earned a BS at MIT in 1932 and a JD at Washington University in 1935. John J. Ford was self-educated. Newman is a scholar. Ford was a salesman. Newman long suspected Ford of dishonesty and is widely accepted as the engine behind occasional unsuccessful efforts to unmask and defrock Ford.

The Ford-Newman controversy carried over into the 21^st century. Their seconds were Michael J. Hodder for Ford and Ted Buttrey for Newman.  (Hodder is an expert in U.S. Colonial numismatics. His degrees include masters from both the City College of New York and New York University and a Candidate in Philosophy from Berkeley.  Buttrey's doctorate is from Princeton; he was chair of the Classics department at the University of Michigan.)  Hodder and Buttrey engaged in a “Great Debate” over Fake Western Assay Bars at the 1999 ANA convention in Chicago. Nothing was settled there; and Ford launched a $6 million lawsuit against Buttrey for libel.  (I filed an amicus brief with the court which was not accepted.) Meanwhile, difficult and troubled finances at the American Numismatic Society forced the release of several curators, Kleeberg among them. He was then free to join Buttrey in pursuit of Ford. Their work caused the Smithsonian to close its exhibit of American numismatics because some of their artifacts were questioned and ultimately condemned as fakes.

For twenty years, Paul Franklin made fake western assay bars which John J. Ford sold to collectors.  The pair researched old newspapers, found the names of assayers, and created punches and logotypes to match the art of the advertisements. Franklin made the bars; Ford invented the stories behind them. Then, Henry Clifford decided that he wanted to own them all and began buying them from other collectors as well as from Ford. When Clifford’s estate went on the market, all these bars (and some private coins) came together in one place at one time. The Henry H. Clifford Collection: Coins of the West was the sylloge for a public auction by Bowers and Ruddy Galleries, Inc., March 18-20, 1982. (Known as the Dean of American Numismatics, Q. David Bowers is the author of very many books and has served as president of the ANA.)  When the Clifford Catalog was published the glaring inconsistencies were impossible to ignore – except by those who never see the elephant in the room.  And American numismatics is house full of elephants.

Eagle Mining Co.

Lot 215 Henry Clifford Sale

To celebrate the Centennial of Independence in 1876, numismatist Montroville W. Dickeson created replicas of colonial coins. His fantasies remain hot items today. In 1836, President Andrew Jackson sent a Navy diplomatic mission around the world to secure ports of convenience for American ships. Among the many gifts for kings and sultans were proof sets of American coins. To complete the sets, the Mint struck a few silver dollars with unused dies from 1804, creating the eight 1804 Dollars of 1834-35. Beginning in 1859, numismatists with friends at the Mint had their own 1804 Dollars made. All of these fantasies are highly prized today. Over the holidays 1912-1913, a clerk at the Mint, Samuel W. Brown, struck off five 1913 Liberty Nickels. A few years later, he advertised that he would buy any 1913 Liberty Nickels. Since no one knew that any  existed, this drew interest. Then, he offered his for sale. These fakes attract record-setting prices at any auction. Today, despite legendary (or perhaps mythical) security instant rarities still leave the US Mint, including Sacagawea dollars “muled” with Washington quarters. (See Coin World July 18, 2011 here.) This is an historical problem. In the 1890s, the U.S. Secret Service attempted to confiscate many pattern strikes that had disappeared from the Mint, but numismatists have friends and money and the Secret Service backed off. On the other side of the ledger, Franklin D Roosevelt's first Secretary of the Treasury was numismatist Howland D. Wood. Roosevelt's Presidential Order requiring banks and citizens to deposit their gold with the Treasury explicitly did not apply to coin collectors (see here).

“The Red Book” (A Guide Book of United States Coins by R. S. Yeoman), has been issued annually since 1947. It is arguably the single basic book on US numismatics owned by any and every serious hobbyist or collector. Material later condemned was catalogued in The Red Book for many years. In 1965 under “Private and Territorial Gold” the Red Book inventoried a “Blake and Agnell” bar and coin.  The bar was perhaps the easiest of all to question as the assayer’s name was really Agrell.  But the 1913 catalog by Edgar H. Adams, Private Gold Coinage of California, (New York: American Numismatic Society) carried the typographical error, the r for n, (an easy blunder in the days of lead and ink) and the forgers repeated it.  As late as 1981, the Red Book carried bars by F. D. Kohler, some of which also have been condemned (though most proved genuine).

I believe that cause of this apparent waffling - an unwillingness to condemn the entire body of putative offerings - is the close working relationship between Kenneth Bressett and Eric P. Newman.  Newman was president of the ANS; and Bressett served as an ANA president.  The two co-authored, The Fantastic 1804 Dollar (Whitman, 1962). Long wary of Ford, Newman would have helped Bressett clean the spurious material from Yeoman’s venerable handbook when Whitman turned to Bressett to continue the annual book. I have never met Eric P. Newman, but I have met Ken Bressett and I trust him implicitly to hold to the highest ethical standards.  

Be all that as it may, the fakes in the Clifford Collection survived for 20 years after publication of the catalogue. 

In April 1999 I joined Coin World as a senior staff writer and their international editor just at the Great Debate was developing. The co-worker I was closest to was Stuart Segan, their “Trends” (pricing) editor. Stuart’s degree is in physics from Berkeley. He encouraged me to approach the problem like a scientist. We examined the Clifford Catalog, and argued out between ourselves the internal inconsistencies in the artifacts. To be fair, I only spoke to John J. Ford on the telephone while working for Coin World. He told me that if I could not tell 19th century die work from 18th, I did not deserve my chair as an editor.  I took his advice to heart and improved my knowledge.  But clearly, Ford was a bully which is corroborated by common knowledge that he called collectors "boobs."

Then the Brother Jonathan and the .S.S. Central America were salvaged. Those ships carried gold coins and bars from the California gold rush. The Central America was called “the ship of gold;” and its loss is cited as a contributing factor in the Panic of 1857.  Generally, none of the recovered remains from those wrecks match the work of Paul Franklin sold by John J. Ford. (See Treasures from the S.S. Central America: Glories of the California Gold Rush, June 20-21, 2000, by Sotheby’s.)

When John J. Ford sold his lifetime numismatic collection through Stack’s numismatic auction firm of New York City the catalogs ran 21 volumes. He did know a bargain; and he pursued items which others passed over, such as Indian Peace Medals. He owned a world class library. The final sale and volume of the sylloge covers Western Assay Bars.  Many pieces that were anticipated did not appear.  (See Kleeberg in The E-sylum October 14, 2007 here. The E-sylum is the weekly email news from the Numismatic Bibliomania Society, whose journal is The Asylum.) Among the historical remains not offered was a bar allegedly made for Wells Fargo by Wass Molitor in 1854 and overstruck in 1864 with a U.S. Revenue stamp. The bar is illustrated in Private Gold Coins and Patterns of the United States by Donald H. Kagin, Ph.D. (Kagin’s doctorate is in numismatics. His website is here.)  The Holabird-Kagin website of Americana is here. 

ALSO ON NECESSARY FACTS:
William Sheldon: Psychologist, Numismatist, Thief
Murray Rothbard: Fraud or Faker?
Numismatics: History as Market
Industrial Medals as the Currency of Fame