As we are poised to enter the year 2017, American numismatists may take note that the venerable Guidebook of U.S. Coins (more familiarly known as the "Red Book") is entering its 70th year of publication. With nearly three generations of history behind it, it provides at this point, one of our best vehicles to study the long-term price history of the U.S. coin market.
I took this opportunity to select 70 representative U.S. coins from across a wide spectrum of the hobby, and follow them at 10-year intervals from the first edition in 1947 to the present 2017 edition. This provided eight data points, and an excellent look at what has happened to coin values since the end of the Second World War.
While this may seem like a straightforward study, it's a bit more complicated than that. Chief among our problems is one of grading. Not only did the first edition predate the Sheldon Numerical Grading System (which did not even gain widespread use outside of early copper coins until the late 1970s), but the whole notion of "grades of Uncirculated" did not really exist before the 1960s. Even then, such descriptions as Choice or Gem BU were vague and anything but formally defined.
The 1977 Red Book was still simply using "Unc" for all Mint State grades. In contrast, the latest edition lists four MS grades for Morgan Dollars, often with substantial price differences between them. This of course begs the question – what is the equivalent 2017 price for an "Unc" 1884-S Dollar from the 1977 edition? The 2017 edition lists MS60 at $7,200, MS63 at $35,000, MS64 at $125,000, and in MS65 it's a whopping $235,000! Quite a difference! Proof coins have the same issues as Mint State coins.
Of course, the answer is it could have been almost any of the above grades. Numismatic eyes during the middle part of the last century were simply not as attuned to quality as we are today, and while all the gems of today certainly traded on the market, the price premiums attached to them were insignificant.
Another factor to consider when analyzing prices over an extended time period are the effects of inflation. While official inflation statistics have been modest over the past 10 years or so and not really significant for short-term price studies, when looked at over a 70-year period, they are substantial. In nice round numbers, the 1947 Dollar is worth just over $10 today. So a $12 price in the 1947 Red Book coincides with a price of about $125 in 2017. They both represent the same amount of money, so if the price increased from $12 to $125 over this period, there was effectively no movement at all.
Presenting all this data in one chart would be overwhelming, so I've split the coins into seven categories: Circulated Early Type (1793-1807), Key Date Coins, 19th Century type coins, Rare Date Gold, Silver Dollars, Gold Type and Colonials/Commems. We'll begin next time with a look at the Circulated Early Type coins.