July 30, 2002
There's a new King in the world of numismatics and it's the fabled 1933 St. Gaudens Double Eagle. The spectacular and controversial coin fell under the hammer on Tuesday, July 30, in New York City and obliterated the previous auction record of $4.14 million for a U.S. coin. The new standard? A remarkable $7.59 million!
The famed coin was the lone item in a special auction conducted by Sotheby's and Stack's. The sale was a special arrangement that provides for the U.S. government to keep 50% of the proceeds while the balance goes to London, England, rare coin dealer Steve Fenton. The coin has been the subject of numerous legal battles over the years regarding its legality as a numismatic item for private ownership.
A packed audience of nearly 500 coin enthusiasts, reporters, cameramen, and onlookers, jammed the 7th floor of Sotheby's building for the one coin auction. Bidding started at $2.5 million and proceeded briskly by $100,000 increments. The winning bidder at $7.59 million was a, so far anonymous, phone bidder.
Fast and furious bidding led to the Double Eagle's final hammer price of $6.6 million.
Multitudinous questions about the condition of the coin were put to rest prior to the sale when four experts from the Professional Coin Grading Service (PCGS) viewed the piece and unanimously declared it to be MS65. Because the coin is pedigreed to King Farouk and the monarch was notorious for abrasively cleaning and/or lacquering coins, there was concern that the 1933 $20 had suffered a similar fate. Fortunately that was not the case and the coin was found to be in Gem-quality condition.
The history of the 1933 $20 in general and this specimen in particular is filled with ambiguity, controversy, deceit and, ultimately, triumph. When Franklin D. Roosevelt took the United States off of the gold standard in 1933 the minting of gold coins continued intermittently for several months. Two Executive Orders (#6102 and #6260) banned the release of further gold coins for circulation, but it is not 100% clear whether a few of the $20 gold pieces of 1933 were legally released. It is known that an export license was granted for this coin during World War II.
Mint Director Henrietta Fore receives the $20 necessary to "pay" for the Double Eagle and balance the Treasury accounts.
The U.S. government set up a sting operation in New York City several years ago to get the coin back. The coin was seized and arrests were made, but as the government's case deteriorated a compromise was struck. Under the agreement this is the only 1933 $20 gold piece that can ever be legally sold (if, in fact, another example [or examples] exists in the private sector).
"This is one of the most significant numismatic events in history," said David Hall, Collectors Universe President and founder of the Professional Coin Grading Service. "The coin itself is magnificent and it bookends two extremely important numismatic events; Theodore Roosevelt's commissioning of world renowned artist Augustus St. Gaudens to breathe life into U.S. coin design in 1907, and Franklin Roosevelt's banning gold ownership by U.S. citizens in 1933. This is an incredibly positive event for the rare coin market. The market has been very hot this year, and this record-breaking sale will no doubt add fuel to the fire."
Auction photos used in this article appear courtesy John Dannreuther.