Steve Duke Presents Tradio Gems: Gold Coin Collectibles


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[audio:|titles=Gold Coin Collectibles]

Steve Duke:
If you heard me, C. C., my question I asked her was, “Baldwin and Company, Kellogg and Company, August Humbert, and Moffat and Company. What do all these have in common?”

These were some of the first territorial minters around. When I say ‘minters’ they were privately owned mints that produced gold coins and gold mintage back in California around 1849.

During the Gold Rush, there really weren’t a whole lot of coinage available for the people at that time. A lot of times, we had people that come into the Westchester Gold and Diamonds and they buy gold bullion and they buy silver bullion.

In the back of a lot of people’s minds is that our dollar is getting weaker and weaker, and maybe at some point in time we will have to buy our goods with physical silver and gold. Well, the first time this really happened was back in 1849 in a big way in the United States. This is during the California Gold Rush.

People came out here and started mining, and they needed goods and provisions. What could they possibly use? There really wasn’t a lot of paper currency available at that time because there were no real banks in the area where they were mining for gold, so they needed a medium of exchange.

They used their gold. At first they used a lot of gold dust, the very fine gold flake that they would mine. They would go to the different stores and each shop owner would have a scale. They would say what the exchange rate was for the gold today.

They would put it on the scale and weigh it. Actually, they used to weigh it with a penny. They would use a penny as the counterbalance on their scale. This is how the term pennyweight came into use. This was a unit of measurement. There were twenty pennyweights in an ounce.

The problem was that not everybody’s scale was accurate. Not everybody’s gold was fine, so they would turn around and discount a lot of the gold flake that they would get in. There was really no real unit of measurement that was standard or very uniform.

What happened first was that a lot of jewelers said, “You know what? We could make our own coins.” They began making what we call California fractional gold. They would make quarters, fifty cent pieces, and dollar pieces.

There was a law back in 1864 that was passed by the Federal Government that said states couldn’t make individual coinage, but on the other hand, individuals could as long as it didn’t look like any other kind of coin that the United States had already made.

It was kind of vague. So a bunch of different jewelers jumped in and they started to make the small coinage. A lot of these jewelers were in Philadelphia; some of them were in Oregon. They were all over across the country, but they jumped in because there was a need for this, so they made a lot of this coinage.

To this day you will still find a lot of that stuff out there. I constantly have people come in with foreign coins. In with the foreign coins you will find a lot of times California gold.

They were popular. There were over 200 different varieties because you had everybody in the world making this stuff, and there wasn’t any uniformity to it other than the fact that some of it was octagonal and some of it was round. The one thing that it all had to have on it was somewhere it had to say the word ‘dollar’ or it had to say ‘dol’.

This is one way that you can tell a lot of the reproduction because this stuff was so popular that even after the 1870s when they stopped making this stuff, they continued to make a lot of souvenir pieces like this. The one thing that you can definitely use to tell whether or not it is actual currency or not is if you look on the backside of it, it might say 25 cents or it will have a 25. Then underneath that it will have the word ‘dol.’

So it was 25 cents of a dollar. Or you might see 50 cents and it would say the word ‘dollar’ or ‘dol.’ Then on the one dollar ones you will always find ‘1’ and then it will say ‘dollar.’

If you find stuff and you think it might be real gold coins, like we talked about these California gold pieces, if you flip it over and it doesn’t say the word ‘dollar’ or an abbreviation of the word ‘dollar’ then it is definitely not. They were usually made out of brass or they were gold plated brass.

This is the one way you can really tell that. These other companies that I talked about set up in California. If a miner would come in and he had gold dust, these companies would assay their gold dust. Moffat and Company was the first official assayer for the United States Government.

The California miners would come in and bring their gold dust. It would be assayed. Lots of times it would be melted into what we call an ingot. An ingot is a rectangular bar of gold. The fineness of the gold would be marked on there. When I say ‘fineness,’ pure gold is 24 karat gold.

Some of the gold you would get was 22 karat gold and they would mark on the fineness that this was 22 karat gold. They would put the weight, how many grams generally, it would be, and what the actual value at that particular time was.

Very few of these ingots will say five dollars or ten dollars. They come in all kinds of weird denominations because this is what the miner had to work with. He came in with $16.43 worth of gold. They would melt that ingot. They would put the fineness on it, and they would put $16.43.

Now he could go out there and exchange that for goods with other merchants. This was the beginning of the real gold exchange. Some of the other companies, like Kellogg and Company or Baldwin – well, Kellogg and Company actually started making one of the first of what we would call slugs that the government would allow them to make.

They made what they called a fifty dollar gold piece. The first fifty dollar gold pieces were actually octagonal. They also made ones that were round. The octagonal ones are a little bit more difficult to find now, but at the time they were pretty cumbersome and they were just a pain in the butt.

They were big. They were gawky. People weren’t used to carrying a fifty dollar piece. They were used to carrying fives and tens and some of the smaller ingots, and some of the smaller fractional gold pieces. But they used a fifty dollar slug at the banks.

You have to understand that back in 1849 and the 1850s, fifty dollars was a lot of money. This was like having a big bar of gold. They were cumbersome. They weren’t really accepted that much. And believe it or not, it got to the point if a merchant had to take one of these fifty dollar slugs in for payment, a lot of them would discount these things as much as three percent.

Right off the bat you lost $1.50 which again was a day’s wage out there. These were the first big, big gold pieces that we saw. Kellogg and Company did these. To this day there are some out there, but they are in collectors’ hands and they are extremely expensive. When in good condition they could be $20,000 and up for the octagonal ones.

Baldwin and Company, and Humbert, were also private minters. They were assayers as well. They turned around and said, “You know what? It is a lot easier if we had a uniform type of currency.”

So they started making five dollar denominations, and ten dollar denominations. These were readily accepted. They weren’t as cumbersome. You could put these in your pocket. You could put them in a little pouch and carry them around. These are some of the earlier minters of that particular time. There were various companies that got into the minting of gold bullion and gold coins out there.

Then again the government stepped in and said, “It is time for us to jump in here and make things more uniform.” So we found that these private minters went by the wayside. The government said that you can no longer print these coins because you are starting to make them look very similar to the U.S. coins at that particular time.

If you have antique coins you may have inherited or stuff like this, there are a lot of various private mints at that particular time who were doing gold coinage. Again, you will see, as we talked about with any type of collectible, if it is worth a lot of money, then there is somebody out there counterfeiting it.

This week it was funny because somebody came in with a whole collection of various ingots. They were in nice boxes and they looked really, really good. They all had Moffat and Company, Kellogg and Company, Baldwin and Company, on them. These were some of the really high end, expensive, rare, territorial gold pieces.

They had inherited them from a grandfather. The story sounded really good. Unfortunately, the grandfather hadn’t died more than ten or fifteen years ago, and at that particular time there were companies printing these things, and selling them as territorial gold replicas.

If you noticed the word ‘replica’, well, that was also in their ad in small print. People really believed that with gold clad or gold replicas they could turn around and buy this gold for a fraction of what it should be worth and put it away and it would be a great investment.

This fellow came in and he opened up the first box and I looked at it. I knew exactly what it was because I had seen so many of these before. Then he proceeded to tell me how his grandfather had given these to him. His grandfather died when he was 103 years old. He was all fired up and he had been looking online.

He had looked up some of these companies and someone had told him that Westchester Gold deals in a lot of these really rare things, and I could give him a check for whatever this stuff would be worth, and he could take that check to the bank and not have any problems with it.

He had taken it one other place and they said, “If you leave it with us, we can check it out, and we will try to sell it for you.”

He said, “No, I want to cash these things in.” He brought them in to me and we opened them up and looked at them. I had to be the one that crushed his retirement fund for him.

I told him that they were all replicas of various private mints.

He said, “I looked them up and this one was $20,000 and this one was $50,000.”

And I said, “If these were genuine I would be more than happy to pay you those kinds of prices for them, but what you have are replicas.”

That is not to say that there is not a lot of that stuff still out there floating around, believe it or not. It was two or three years ago that someone came in with a five dollar gold Mormon piece that was mixed in with some of their foreign coins that they had inherited.

They wound up with an extremely large check for that particular coin. Their foreign coins weren’t worth a whole lot of money, but the problem is that people haven’t seen a lot of these privately printed pieces.

C. C. Brooks:
You said that it was a Mormon piece?

A lot of the various towns in the United States had privately printed gold pieces. The Mormons had a five and a ten dollar piece that they had put out. It doesn’t look anything like a coin that you have seen before. All it had was a denomination on it.

Again, it was mixed in with a lot of foreign coins. They weren’t gold, but you have to understand that a lot of times the fineness on these coins wasn’t always 24 karat. Twenty-four karat is very kind of brassy looking.

You find that if it wasn’t 24 karat, what they alloyed it with or the gold that they may have melted down to produce these coins, was a lower karat. And over a period of time it will oxidize and it will change color.

A lot of times the gold coins don’t necessarily look like they are real gold. Again, if you mix these in with a handful of old copper coins, and a little bit of silver and nickel stuff, the next thing you know, bingo bango, you have sold an extremely rare coin to these people who come into town and run these huge ads and put ridiculous prices for stuff that you will never ever have or you will never ever see.

But in the condition they are buying them, and the prices that they reflect, a lot of the coin prices reflect a brilliant uncirculated 1794 ten dollar gold piece. Certainly it is worth $14,000 or $15,000.

One coin that is not in that kind of condition is still worth $5,000 or $10,000 but a lot of people don’t know what they have. They get you in the door and a lot of these companies come into towns and just rape and pillage. That is what they are there for.

C. C.:
They can really take advantage of people.

They take advantage in a big, big way. I know a lot of them come into town, they run commercials on the radio, and they certainly can’t do anything but take their money to run these commercials.

But, again, if you are going to deal with somebody, deal with somebody who has been in town for over 30 years. Deal with somebody who is knowledgeable in what they are doing. Don’t rely on a fly by night when they come in here. They are not there to be your friend. They are there to make the very most they can in three or four days or a week, and take advantage.

This is what happens.

I am Steve Duke, the owner of Westchester Gold and Diamonds. I talked to you a little bit about early gold pieces today, and believe it or not, that stuff is still out there. With high gold prices right now, I realize that a lot of people have come in and sold their gold jewelry and things like this.

But before you just sell it for the gold weight, you might want to stop by and see us. There are a lot of gold coins that have been mounted in gold jewelry that happen to be rare gold pieces, and certainly command a large premium. Don’t sell them for the gold price; don’t make that mistake.

Stop by and see us. We are in the Baer Plaza behind ABC Liquors. Westchester Gold and Diamonds is located at 4200F Tamiami Trail, Port Charlotte, FL 33952.
Call (941) 625-0666.

Westchester Gold and Diamonds provides services including custom jewelry design, repairs, appraisals and other jewelry and antiques related services. Westchester Gold and Diamonds is open 10 a.m.-6 p.m., Monday through Friday; 10:30 a.m.-4 p.m., Saturday and by appointment at your home or bank.