The Rise and Fall of 1903-O Silver Dollar

Numismatic Interest Begins

Numismatic interest in Morgan dollars by date and mintmark varieties was almost nil, and probably not more than a dozen or more aspired to acquire “new” pieces as they were struck each year. One of these collectors was John M. Clapp, who sent a remittance to the New Orleans Mint for one each of the current silver and gold coins being struck, and received a 1903-O silver dollar by mail in October of that year.¹

In 1918 the Pittman Act provided for the eventual melting of 270,232,722 silver dollars of earlier dates, probably including most of the 1903-O mintage. In 1929, at least a few hundred bags each containing 1,000 1903-O dollars were transferred to storage at the Philadelphia Mint, as use of the New Orleans Mint building was discontinued. Thousands of bags of other New Orleans dollars were shipped as well.

Every so often it was Treasury practice to take inventory of its silver dollars, especially when political administrations changed and the Treasury Department came under the aegis of a new director. This was done in various ways, including by manually counting stored bags and sampling some of them. However at the Philadelphia Mint, the dollars from New Orleans were placed in a sealed vault, thus securing its count and removing the necessity for re-examination.

In the meantime, a few dedicated collectors sought to acquire one each of the nearly 100 different major varieties of 1878-1921 Morgan dollar dates and mintmarks. The number of such enthusiasts is not known today, but it was probably no more than a few dozen. Most who were interested in Morgan dollars were content to get just one of each date, never mind the mintmark, and Proofs filled the bill.

Newcomb’s Observation

An early appreciation of the 1903-O was printed in The Numismatist, July 1925, in this note by Howard R. Newcomb, a Detroit collector who was an avid student of silver coins by mintmark varieties:

“There seems to be something peculiar about the standard silver dollar of 1903 issued from the New Orleans Mint. Although the government records indicate a coinage of 4,450,000 pieces, I failed to locate, in the last half dozen years, any specimens either in the hands of dealers or collectors, save one in my own collection and one in a prominent collection in Washington, D.C.¹ They seem to be equally scarce even in circulation.

“Although silver dollars were not plentiful in circulation in these parts, I have enlisted the aid of the head cashiers in three of our larger stores to be on the lookout for this piece. It is customary in these stores when silver dollars are received not to give them out again in making change, but to deposit all of them. These men, for several years, have looked over thousands of silver dollars and not one has come to light. Two of our A.N.A. members, one in Los Angeles, the other in San Francisco, have also searched where the silver dollar is plentiful and they, too, have been unable to find any. The only explanation I can offer is that the government, during the late war, sold the entire mintage as bullion and the entire mintage rested in the government vault, undisturbed, until that time when so many millions of silver dollars were melted up.”

Apropos of Newcomb’s comment, the editor of The Numismatist, Frank Duffield said:

“Silver dollars are not collected extensively, but if they were, it is more than probable that other dates and mintmarks would be found to be far rarer than the recorded coinage would indicate.”

Thresher’s Quest

The same issue of The Numismatist, July 1925, also included an article by E.S. Thresher, “Coins That Can Be Found in Circulation,” of which excerpts are given below.

“On June 1919 I started an experiment to see how long it would take to find every date and mintmark of the coins of type now in circulation, that is, silver dollars since 1878, half dollars, quarter dollars, and dimes since 1892, nickels since 1883, and cents since 1864.

“I put every date and mintmark on a card which I carried in my pocket, whenever I found one I checked it off. Not being in a business where cash is handled, I had to depend on such coins as I would get for pocket money, except cents. For these I had access to the collections of about 200 “penny-in-the-slot” machines.”

Thresher lived in Kansas City. He noted that these were the dates and mintmarks of silver dollars that he had not yet found:

1878-S silver dollar with 8 tail feathers, 1884-CC, 1885-CC, 1889-S, 1892, 1893-S, 1894, 1897, 1899, 1923-D (Peace), 1925-D, 1925-S.

Thresher noted that he had found an 1895 dollar, a coin of which 880 Proofs were struck, but which to this day no Mint State piece has been confirmed. Perhaps Thresher’s 1895 was a spent Proof. The Thresher listing is extremely valuable for research today, as it shows which dates of Morgan (and a few Peace) dollars were not in widespread circulation at the time. I wish that more accounts of this type were available, as they would help numismatists figure out the circulation patterns of certain issues.

Regarding the 1903-O, Thresher had better luck than Newcomb did, for this rarity was not on his 1925 “want list.”

Neil’s Reply to Thresher

In the September 1926 number of The Numismatist, Will W. Neil, a druggist in Baldwin, Kansas, in a letter to the editor dated July 23, 1926, noted that he had been looking through coins for eight years in connection with his business:

“Of the silver dollars from 1878 to 1904 I found one complete set, all dates and mints, and several varieties.…

“I then started a second set and have it complete with the lone exception of 1903-O, which is a tough fellow to find. I suppose I have looked over 5 million silver dollars to find the ones I have. I have found most of the other pieces that he [Thresher] could not locate, with the exception of the two rarities [probably the 1895 and 1903-O].”

Imagine that—looking through five million silver dollars and finding only a single 1903-O! Amazing!

A Rarity Is Recognized

The years slipped by, and in the 1930s the collecting of rare coins became a nationwide passion. Although America was in the depths of the Great Depression, there was a boom in hobbies as a diversion from everyday cares. Jigsaw puzzles became a fad, and thousands of shops and departments were set up to sell or even rent these. Miniature golf was the outdoor game of the day, and courses were built just about everywhere.

In New York City, Wayte Raymond, a coin dealer associated with the Scott Stamp & Coin Co., made an arrangement with M.L. Beistle, of Shippensburg, Pennsylvania, a manufacturer of cardboard products. Beistle, a numismatist, was particularly interested in early American half dollars and wrote an excellent book about them. Important to the present narrative, he also devised cardboard album pages with clear cellulose acetate slides which permitted coins to be stored and displayed in orderly rows and viewed from either side.

Marketed by Raymond under the “National” name, these album pages were made in two sizes and could be fitted into leatherette notebooks. Now, for the first time, a coin collection could be stored and displayed at the same time, while an empty hole signaled “I gotta get one!”

Within the space of a few years, the National albums achieved wide distribution. Now, attention was paid to the empty holes, and rare dates and mintmarks became highly desired. Before long, every school kid seemed to know that a 1909 Lincoln cent with a tiny “S” mintmark below the date, and the initials V.D.B. (for designer Victor D. Brenner) on the reverse, the 1909-S V.D.B. cent as is was called, was rare, and, by gosh, was worth several dollars—if you could find one!

Similarly, among Liberty Head nickels, the 1885 was scarce and worth a premium. Down in Fort Worth, Texas, dealer B. Max Mehl had his own radio program about rare coins and offered $50, later increased to $500, reward for anyone finding a super-rare 1913 Liberty Head nickel.

In the meantime, in 1934, Wayte Raymond launched The Standard Catalogue of U.S. Coins, which became the only regularly-issued guide to coin values. Mintages and historical information were also given. As if this were not enough, in the autumn of 1935 a great boom market developed in commemorative half dollars—as new issues were eagerly sought and in some instances multiplied in value almost overnight.

In this milieu, the number of numismatists seeking 1878-1921 Morgan silver dollars by date and mint increased to hundreds, if not several thousand. It was soon learned that while most of the more than 95 major varieties could be obtained without undue effort, there were a few “stoppers,” and prime among these was the 1903-O. Occasionally a well-worn one would be encountered, but a Mint State example—forget it! Most dealers had never even seen one!

By any accounting, the most prominent rare coin dealer of the first half of the twentieth century was the aforementioned Mehl. From his ground-floor office on Magnolia Street in Fort Worth, he bought and sold a generous share of major rarities and collections. In June 1941 his sale of the William Forrester Dunham Collection was the brightest feather on his numismatic cap. This incredible cabinet had nearly one of everything, including an 1804 silver dollar and an 1822 $5 gold half eagle. It also had an Uncirculated 1903-O dollar, special notice of which was taken concerning its rarity. The listing was as follows:

“1903-O Unc., sharp, with full original mint lustre. Just as perfect as the day it was minted. Excessively rare so choice. Listed at $35 and worth a great deal more in this remarkable condition.”

To the modern reader the listing of a 1903-O dollar for $35 may not seem exciting. However, in 1941 it was exceedingly important. For comparison, here is what Mehl said about the 1895 dollar in the same Dunham catalogue, the 1895 being worth tens of thousands of dollars today!:

“1895 Perfect brilliant Proof. Rare. Very limited number of Proofs struck. Listed at $6.”

One success followed another with Mehl, and in March 1948 he offered the Dr. Christian A. Allenburger Collection in a catalogue that has not been well remembered since then, but which, upon close examination yields some of the most incredible early (pre-1858) Proof coins ever to be presented at public sale. Among other items in the Allenburger sale was this Morgan silver dollar:

“1903-O Uncirculated. An even beautiful lustrous mint surface. Extremely rare in any condition, but especially so choice. A similar specimen in my sale of the Roe Collection, three years ago, brought $115. Probably not more than four or five known in this remarkably choice condition.”

October 1962

Years slipped by, coin collecting became increasingly popular, and by October 1962 tens of thousands of numismatists collected silver dollars by dates and mintmarks. The standard arbiter of coin values was A Guide Book of United States Coins, which had been issued annually since 1946. In the Guide Book in 1962 the 1903-O silver dollar in Uncirculated condition listed at $1,500.

For perspective I mention that at the same time in the coin market a typical Liberty Seated dime in Uncirculated condition catalogued for about $12, an Uncirculated 1796 quarter could be bought for $2,750, and a Mint State Capped Bust half dollar of the 1820s merited a valuation of $16.

The 1903-O Morgan silver dollar was a legendary rarity in Mint State. Few dealers had seen an example, and fewer still had actually owned one. The situation hadn’t changed much.

In October 1962 the numismatic world was shocked by the news that a few Mint State 1903-O dollars had come to light. Telephone calls were made, dealers had conferences with each other, and it was concluded that some had trickled out of the Federal Reserve holdings, along with examples of 1898-O and 1904-O, issues also considered to be rarities. Within a week or two, the “few” coins of these three New Orleans Mint issues expanded to several million.

A treasure trove beckoned. Not often in life does anyone have the chance to buy coins listed at $1,500 in the Guide Book for face value! Banks, the Federal Reserve outlets, and others holding dollars were besieged with buyers. As the Treasury dug deeper and deeper into the vaults, more and more silver dollars of various early dates were found. Values plummeted.

It is said that the small town of Alma, Michigan was the site of some of the first 1903-O dollar discoveries. The race was on, and the silver dollar market would never be the same again. The news spread that the 1903-O and other New Orleans silver dollars had been shipped to the Philadelphia Mint in 1929, and had remained in a joint-sealed vault since that time. A generation of distinguished Philadelphia numismatists came and went, without knowledge of their existence in their very backyard! Additional coins came out from hiding in the Treasury Building in Washington, D.C., where, for some unexplained reason, they had not been noticed by coin-wise employees earlier.

Reminiscing in The Comprehensive Silver Dollar Encyclopedia, dealer Dean Tavenner said that in Helena, Montana, a banker had 1903-O dollars available in quantity by February 1963. The least Dean Tavenner remembers paying for an Uncirculated piece was $7 each, probably in the summer of 1963. He recalled that by November 1975 he sold five rolls for a banker from Dillon, Montana for $2,100—which amounted to $21 per coin.

Writing in an advertisement in The Numismatist in January 1964, Steve Ruddel told of an unspecified Kansas City dealer who “panicked…when he got a bag of ’03-Os. He soon flooded his local market and got $3 or $4 each. At the same time I had a standing offer of $15,000 a bag and couldn’t buy any.”

I was first told about the release of 1903-O (and 1898-O and 1904-O) dollars by Philadelphia dealer Harry J. Forman, who telephoned dealers and collectors around the country to alert them to the situation and also to warn them against deception. It seems that a few clever insiders obtained coins of these three formerly-rare dates, and hurried to dealers’ stores to sell them for cash—at prices based upon the old catalogue listings. One such insider flew to London, where he endeavored to steal a march on B.A. Seaby, Ltd., A.H. Baldwin, and Spink & Son, Ltd., the three leading British rare coin dealers at the time. After the news broke, I was offered a few bags for $17,000 each in late 1962 or early 1963 by a Detroit source, but I declined, as I was fearful that about four million more coins would be coming out of the Treasury; I was wrong on the four million, but time would have vindicated a purchase at $17,000 per bag.

Dozens of bags of 1903-O dollars were released in 1962-1964. Exactly how many coins were involved is not known, and guesses have ranged from 60,000 or so to over 1,000,000. Wayne Miller’s estimate is 60,000 to 100,000. Probably, the truth lies somewhere between 60,000 and several hundred thousand. I suggest 200,000 to 350,000.

Numismatic “Silver Rush!”

For decades, the Treasury Department and various banks stored hundreds of millions of 1878-1921 Morgan dollars and 1921-1935 Peace dollars. While collectors sought pieces of interest and sometimes looked through bank holdings, or laid away a bag or two for investment purposes, there were so many silver dollars that the majority remained untouched.

The 1903-O bonanza changed everything. A “silver rush” was on! As news spread, thousands of fortune seekers cleaned out the vaults of local and regional banks, which for a time were resupplied with new shipments by the Federal Reserve. In time, more former rarities came to light, some in very small quantities (only a couple dozen of the rare 1893-S, if indeed that many, and perhaps none of 1895-O at all), others by the millions.

Early Philadelphia, Carson City, New Orleans, and San Francisco issues became plentiful in numerous instances. Still, some remained rare. By March 1964, the Treasury was nearly out of silver dollars. Articles in newspapers in Montana, Nevada, and other states in which everyday use of the coins was common, bemoaned the impending day that such coins might no longer be available. Legislation was introduced to mint more silver dollars. Such articles simply increased the demand for what few million silver dollars remained in the Federal Reserve system and Treasury Building vaults.

In March 1964, visitors to Washington, D.C. were greeted with the unusual sight of long lines of people with pockets stuffed with cash, some with wheelbarrows, eager to acquire $1,000 mint bags from the payout windows in the Treasury Building (with certain Federal Reserve System employees making nice profits on the side). On March 25, 1964, the Treasury called a halt and the government took stock of the situation and held back the remaining pieces deemed to be of numismatic importance. By that time, only about three million silver dollars remained in the Treasury Building vaults. An inventory of the undistributed coins showed that Carson City issues, particularly those of the 1880-1885 years, were on hand in tremendous quantities. In fact, the larger part of the original mintages of these pieces was still held by the government! After all but several million silver dollars had been passed out at face value. These were subsequently sold in a series of seven auctions held by the General Services Administration during the 1972-1980 years.

From the preceding incredible scenario the 1903-O Morgan dollar remains as one of the most interesting mementoes. There are enough around that, unlike Howard Newcomb in 1925, you can easily (and inexpensively) buy one now.