Just a week after the passing of the Bland-Allison Act, the first Morgan dollars were coined on March 7th, 1878. After several adjustments of the dies, the Philadelphia mint cranked out the first dollar coin. After close examination of the coin, it was rejected and sent to the melting room. The press was then adjusted and 11 more coins were produced. The last was rejected and this coin was also sent to the melting room.
These first coins were struck on polished planchets, removed by hand and put in numbered envelopes with the intent to deliver the first coin to the President and the 2nd coin went to Secretary of the Treasury John Sherman and the 3rd to Linderman. After that, the press began churning out 80 dollar coins a minute. Within a few days, several other presses would come online and dies would be delivered to San Francisco, New Orleans and Carson City.
As mentioned before, the purchasing power of a dollar back in the 1880’s was huge. Most transactions were completed in smaller denominations as large purchases were under a dollar. Additionally, many people were still bartering for goods (trading pigs for chickens, etc). As such, the supply of silver dollars far exceeded demand. Incredibility, with this supply, The Bland-Allison act was modified by the Sherman Silver Purchase Act which mandated the US Government purchase 4.5 million ounces of silver per month.
The hitch was that these purchases were to be paid with Treasury bonds redeemable in either gold or silver. Since gold was seen as the more valued metal, most bond holders redeemed them for gold which depleted the Treasury’s gold supply which then caused a financial panic through the whole country in 1893. This led to the repeal of the Sherman Silver Purchase Act. The result was a massive slowdown in silver dollar production for the years of 1893, 1894 and 1895.
Not coincidently, these years also contain some of the most elusive key dates. Production picked back up in 1896 but it would be a few years before production went back above the 10,000,000 mark for any individual mint. In 1904, the supply of silver was exhausted and the Morgan Dollar ceased production, or so it seemed.
In 1918, Congress passed the Pittman Act and recalled over 270 million silver dollars for melting. Total mintage of the entire series totaled nearly 657 million. If you subtract out the high mintage 1921 dates of 86.7 million, (these were made from the melted older dollars), around 47% of Morgans dated prior to 1921 were destroyed. These silver dollars had been sitting in Treasury vaults for years just collecting dust.
The provision of the act, called for the recall of these dollars for the purpose of making new ones. So, in 1921, the Morgan dollar was revived for one more year. Barber had died four years before (February 18, 1917) and now George T Morgan was Chief Engraver who you recall designed the dollar.
The Philadelphia mint made over 44 million, the highest number it had ever made, while the San Francisco mint made over 20 million, which was more dollars in one year that it had ever made. Also, this marked the only year that the Denver mint made Morgan Dollars. The New Orleans and Carson City Mints had long ago ceased operations. Later that year, the Peace Dollar would permanently replace the Morgan Dollar.
With the paper dollar becoming more popular for commerce, dollar coins vanished from circulation and piled up in bank vaults. More meltings occurred due to the War Time Silver Act of 1942 and then in 1979-1980 when silver shot up to near $50 per ounce. No doubt millions of Morgans and Peace dollars were melted. Today, it is estimated that only 15-17% of all Morgan dollars produced still exist. Taking this into consideration, low mintage dates are even scarcer than their mintage would indicate making this a very desirable coin to collect.The English called them "pieces of eight" and gold "doubloons" and to this day these coins remain the archetype for treasure.
Vast discoveries of gold and silver by Spanish conquistadors lead to the creation of convoys of galleons to transport the treasure from the New World to Spain. Many of these overloaded ships sank in storms and it is estimated at 20% of all gold mined was lost to shipwrecks. Since the late 1960’s a number of these have been located and salvaged. Sunken treasure coins are collected by numismatists and historians and many are made into fashionable jewelry.
New World Mints
There were a number of New World mints.
* Mexico City: (OM) 1536-1821.
* Potosi: (P) 1574-1773.
* Lima: (L) 1568-89; 1684-1822.
* Cartagena: (NR) 1625-27; (C) 1627-55.
* Nuevo Reino / Santa Fe de Bogota: (NR) 1622-27: (RN) 1627-1756.
* Santo Domingo: (SP) 1542-64; 1573-78.
* Guatemala: (G)(GN) 1733-1821.
* Santiago: (Sº) 1750-1817.
* Popayan: (P) 1758-1822.
* Cuzco: (C) 1698; (C) 1824.
Maravedis, Reales, and Escudos
Whether envisioned as pirate gold or sunken treasure, these coins were the basis for a world monetary system that has survived to the modern era. The Spanish was a base-eight monetary system was based on the relative values for copper, silver, and gold. Copper coins were called maravedis, silver coins were reale, and gold were escudos. Sixteen maravedis equaled one real and sixteen reale were worth one escudo.
Copper maravedí were struck in denominations of 1, 2, 4, and 8. Silver coins were alloyed .931 fine and were called real (1), reale (2-8), and reales (more than one coin). From 1536 to 1542 reales were minted in denominations of 1/4, 1/2, 1, 2, and 3; after 1542 they were generally produced as 1/2, 1, 2, and 4-real coins. The famous 8 reale was first minted in the New World in 1572 and was commonly known as a “piece of eight” or a “Spanish dollar.” Smaller denominations were called “bitts” after the practice of cutting 8-reale coins into sections to make change. The 1/2-real coin was commonly called a “picayune” and the 1/4 real as a “cuartillos.”
By royal decree, the 8 reale was to weigh (the equivalent of) 27.3 grams or .96 troy ounces. Lesser denominations were subdivisions of this weight -1 real being 3.412 grams / .12 ounce. In practice coins were usually a little “light.”
Gold coins were alloyed .903 fine (22K). They were produced in denominations of 1/3, 1/2, 1, 2, 4, and 8. The 8 escudo was called a “doubloon.
Cob Coins
Prior to the introduction of mechanical minting equipment in Mexico in 1733, coins were made by hand. The ingots or sand-cast fingers of metal were then forged into long, thin bars of metal. The bars were cut in sizes appropriate for different denominations and then individually weighed and pieces clipped so each planchet of metal was an exact weight. These planchets were then placed in oversized copper dies that had been hand engraved by the assayer of the mint. The dies were hand struck using large hammers or mallets. These irregular-shaped coins are known as “cobs” after cabo de barra (cut from bars).
On cob coins the hammer marks from the forged bars are often quite visible, as are short, straight edges where the planchets were clipped. Because the circular dies were designed larger than necessary to facilitate placement of the odd-shaped planchets, only part of the design is visible on the coins. Special presentation coins were sometimes made by carefully making a circular disk to fit the dies: these were called “royals,” because they were only made for nobility and dignitaries.
Coin Designs
The Spanish Hapsburg kings also held the title of “Holy Roman Emperor” and therefore the reverse of most cob coins minted after 1572 bear a cross as the central image of the reverse side. Most of these were augmented with the lion for the province of Leon and a castle tower for that of Castile within the arms of the cross. Coins minted in the New World had the legend HISPANIARVM : ET : INDIARVM: REX (King of Spain and the Indies) and the date. The design of the cross often differed from one mint to another, especially those from Potosi, Mexico City, and Lima.
The design on the obverse of these coins changed over time. The earliest “Carlos & Johanna” reales showed two columns representing the Pillars of Hercules, later the Hapsburg Shield would become the central design. The mint mark, assayer’s initials, and date appear on the obverse, but in different places for different designs and different mints. The “Pillar” and “Portrait” dollars would later appear on round, reed-edged “milled” coins.
