Silver Dollars & Trade Dollars of the United States - A Complete Encyclopedia

Chapter 3: Early Dollars, Historical Background
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It is probable that many of the known 1797 dollars were actually coined and delivered on January 5, 1798, when the chief coiner brought 30,372 dollars to the treasurer. The maximum coinage from one press, per day, at this time was about 13,000 pieces (the figure is for cents and may be somewhat lower for larger coins such as the dollar), meaning that many 1797-dated coins may have been struck in 1797 but not delivered until the beginning of the new year. Struck coins were sometimes held for several weeks before delivery if there was not enough on hand to payoff the oldest unpaid bullion deposit.

As if the silver famine of 1797 was not enough of a problem, two other disasters struck the Mint during that year. The first of these was in the person of an important Philadelphia merchant and importer named John Vaughn, who had been a heavy depositor of silver in 1795. During 1796 he learned of the illegal standard in effect until October 1795 and calculated that he had been shorted about $2,300 on the payment in coin from his bullion deposits. This was a considerable sum of money in those days, and Vaughn demanded that the government pay him what was his legal and moral due. The Treasury refused to comply.

Mint Director Boudinot played a key role in this refusal to pay Vaughn the money he was owed. The director produced the novel argument that no crime against Vaughn had actually been committed because the 1792 law did not provide penalties for putting too much silver in the coinage. Boudinot noted that Vaughn had received all his silver back in the form of coins, it was just that there should have been more coins. Vaughn did not accept this bizarre argument and applied directly to Congress for relief. It was not until 1800, along with a great deal of heated debate and delay, that he was paid.

The second major problem during 1797 was the return of the yellow fever epidemic, the first serious attack of the disease since 1793. The Mint closed late in August and did not reopen until nearly the end of November. Some coins of the precious metals were apparently struck in 1797, but not delivered until early-in 1798, as noted above. There was a considerable coinage of copper cents in December 1797, however.

Director Boudinot was so concerned' about the shortage of silver bullion in particular that he searched for a reliable source and, at length, was to succeed; In April 1797 a formal agreement was signed with the Bank of the United States, a semiofficial institution, to supply foreign gold and silver coins for recoinage by the Philadelphia Mint. It was also agreed that these deposits of foreign coins would not include the Spanish dollar because of heavy domestic use; however, this prohibition was only temporary and was later abandoned.

The problem with the Bank of the United States was that during 1797 that institution had almost/no foreign silver coins to send to the Mint. In November 1797; however, the Bank of North America delivered nearly $30,000 worth of French silver, mostly in crowns of the old regime. It was not totally a blessing because this bank wanted their bullion returned only as silver dollars, as would most of the depositors during 1798 and 1799. This in turn meant that very little in the way of minor silver would be struck for the benefit of the general public.

Dollars of 1798 and 1799

Even though few of the smaller silver coins were to be made in 1798' or 1799, it was a mixed bag of complaints and benefits. The Mint could stay open because it was receiving deposits, but complaints also came its way. Yet the minor silver coinage was not always a problem because there was a great deal of Spanish silver coinage in daily use in the United States, mostly in reales (12-1/2 cents) and two reales (25 cents). The situation was complex and without a ready solution.

Despite the large November deposit, others were urgently needed, and Director Boudinot decided to put his own money into use by depositing slightly more than 9,000 French crowns (worth $1.10 each). His $10,000 worth of silver was paid off in dollars, but by this time other deposits were arriving and the director used his money in other ways. In 1800, when fresh problems arose with insufficient deposits, Boudinot was to return with his $10,000 again.

The Boudinot silver, coupled with increased deposits, especially from the Bank of the United States (which now had a surplus of foreign silver coins), signaled the end of the famine. Coinage of dollars was very heavy in 1798 and 1799 (327,536 and 423,515 pieces, 'respectively). In 1799 the only silver coinage was of dollars.

As noted above, part of the January 5, 1798, delivery of dollars was probably dated 1797, but there is no certain way of determining the actual number included in this delivery. It is entirely possible that the entire 30,000+ coins of January 5 were dated 1797. Dollars of this date are simply much too common, in a relative sense, for only 7,776 to have been made, the amount reported for the calendar year.

It is not clear precisely when the scarce 1798 Draped Bust dollars with small eagle reverse were struck. They may well have made up a small part of the January 5 delivery noted above, or perhaps they were struck in the latter part of January. The mintage was certainly small, whenever the time of striking. Oddly enough, even for this coinage, there are two obverse dies, one with 13 stars and one with 15. The latter is the scarcer of the two.

Chapter 3: Early Dollars, Historical Background
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

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