Silver War Nickel

Silver war nickels issued from 1942 to 1945 are a bit of an oddity in the coin community. I say beauty is in the eye of the beholder. Often war nickels are grimey looking, almost like they have been found in an automotive garage. Regardless of the way they look there is a market out there for them.  The silver melt value of war nickels is only $4.48 as they are only 35% silver, making them very affordable.

Although most Jefferson nickels, first minted in 1938, are nickel, those minted from 1942 through 1945 actually are a copper/silver/manganese composite. This was due to the fact that nickel is a key component of armor plating which was in high demand during the peak of World War II. Not only were “war nickels” important because of their silver content, but they were important as a symbol of the sacrifices necessary during war-time.

During World War II, many things were rationed and ration books allowing purchase of commodities such as gasoline, wheat and sugar on certain days were commonplace. As a way to dedicate nickel resources towards wartime efforts, Congress authorized the U.S. Mint to manufacture nickels using a 50% silver/50% copper mix but gave the Mint the final say as to production composition. Ultimately, to ensure these nickels would work properly in vending machines, the final composition of 56% Copper/35% Silver/9% Manganese weighing a total of 5 grams with the standard 21.2 millimeter diameter was settled on for production nickels.

Although there were around 900 million “war nickels” minted between 1942 and 1945, due to the short timeframe for production (ceased at the end of World War II) and the susceptibility of the composition for corrosion, war nickels today are very difficult to find in collectable condition. While any war nickel in virtually any condition is worth at least a dollar in today’s money because of the silver content, few of them command an unusually high value.

The exceptions to this are the 1943 D in Uncirculated condition and what could be perhaps one of the rarest coins on the market to date, the 1943/2 overstrike. Due to circulation losses, lack of verification until 1978 of the overstrike and due to the “silver rush” in January, 1980, as much as 85% of the entire 1943/2 run may have been destroyed. This means as few as 40,000 1943/2 overstrike Jefferson war nickels may still exist in any condition.

Seated Liberty Dollar

The Seated Liberty Dollar was minted between 1840 and 1873 in the United States.The current melt value for this coin is $61.25 although a coin of this period almost always sells for much much more.

From 1840 until the passage of the Coinage Act of 1873, Seated Liberty Dollars were the coins produced from the U.S. Mint. During this time, most silver coinage produced by the Mint were essentially “on demand” and were only struck when the Mint was presented with silver. Initial design began in 1836 but the final approval wasn’t received until mid-1840 when a trial strike of 12,400 Seated Liberty Dollars were produced in July as examples of what bullion depositors would receive as struck coinage.

The Seated Liberty Dollar was minted between 1840 and 1873 in the United States.The current melt value for this coin is $61.25 although a coin of this period almost always goes for much much more.

Until the New Orleans Mint began striking Seated Liberty Dollars in 1846, all silver dollars were produced at the Philadelphia Mint. The San Francisco Mint also struck hundreds of thousands of Seated Liberty Dollars, many of which were thought to be shipped to China to pay for trade goods. From 1870 until the abolition of silver dollar coinage in 1873, the Carson City Mint also struck the Seated Liberty Dollar as well.

The entire striking, including all mints, from 1840 until 1873 totaled just under 3.2 million Seated Liberty Dollars. The lowest production years were 1851 and 1852 when only 2,400 total Seated Liberty Dollars were produced. Some years (1851-O and 1858) are also extremely rare due to no production with only proof strikes being produced. Also, many Seated Liberty Dollars were melted down by private owners and large melts were done in the New York Sub-Treasury to be restruck as smaller denominations.

Although the initial design coins were struck in accordance of the 1792 law stating silver coin purity was to be set at .892 (89.2%), the Coinage Act of 1837 restructured silver purity to be .900 (90%) silver. Subsequent designs and the production coins all met the 1837 standards for silver purity.

The Seated Liberty Dollar weighs 26.73 grams and has a diameter of 38.1 millimeters. The remaining metal content is copper and the edge of the Seated Liberty Dollar is reeded. In 1866, the reverse design was changed to add a ribbon with the text “In God We Trust” which became the standard used until the coin was abolished in 1873.

Buying Silver

Let’s take a look at silver bullion:

On the whole, silver bullion, whether in 1oz., 100oz. or 1000oz. bars is pretty much directly tied to current silver prices. This means if the spot price for silver drops some 15% as it did over a 2 day period in April, 2013, the value of your silver drops as well. It doesn’t much matter if your bar has the basic hallmarks for purity and actual weight or if your bars were made by a mint or a private firm, silver bullion is only going to be worth what the silver market says it is. If you’re looking at silver from a very strict investment standpoint, this could well be the answer you’re looking for as the buy-in is relatively inexpensive and storage and transport is fairly straightforward.

However, when you take a look at silver coinage, especially coins that were not designed to be a “replacement” for silver bullion, the investment angle takes on a whole new perspective. When you take a look at coins such as the Morgan silver dollars and half dollars, Mercury dimes, Canadian silver coins and a variety of other silver coins from other countries, the investment angle shifts from a strict silver value to the age of the coin, the rarity of the coin and the condition of the coin.

As an example, the current melt value for a common Morgan silver dollar in poor to fair condition is running right at $17 (give or take a few cents). This is based on current silver prices and the fact that a Morgan dollar is actually 90% silver. However, as a coin, a quick scan of eBay shows you’re not going to get one in pretty much any condition for less than $25. To complicate that even further, when you start looking at the rarity of the coin, especially when you’re trying to track down those with a CC (Carson City) mint mark, the price jumps dramatically with some coins in “perfect” condition running over $800 each.

Overall Bullion Vs. Coins

Granted, the buy-in for coins will be higher than purchasing straight bullion bars. However, since coins are valued by far more factors that strictly spot silver market prices, your money is actually somewhat safer since coin prices do not fluctuate nearly as significantly as metal prices. This not only gives you a safer investment but, as most trends show, coin prices rarely drop. As a matter of fact, with the exception of price spikes during the mid-1980s, the price for a MS65 Morgan silver dollar has remained pretty much in the $100-150 range, especially over the last decade. If you’re looking for a great way to conserve capital while keeping a solid investment portfolio, silver coinage definitely has a much more solid platform than bullion.

Morgan Silver Dollar (img)

Where Did The Morgan Silver Dollars Come From?

Back in the 1870s, the Comstock Silver Lode produced a huge oversupply of silver while the unemployment rate in the US was significant. The US Mint struck a deal with Nevada silver producers to generate a large amount of Morgan silver dollars. This provided an outlet for the oversupply of Comstock silver while providing employment to workers all over the country. Morgan silver dollarswere produced in 5 different mints and while the immediate goal of providing employment was met, so many Morgan silver dollars were produced that millions of them had to be placed in storage to prevent negative effects on the overall US economy.

The Move Of The Century

With so many millions of Morgan silver dollars in storage, the US government decided something had to be done. In 1917-1918, the Pittman Act was passed which made provision for some 300 million Morgan silver dollars to be melted down and the silver reused for other coins and purposes. The coins that were melted were from multiple years and from multiple mints which means that some years and mintages were virtually wiped out. This created a collectable coin market which made the Morgan silver dollar a very popular coin to collect as well as to invest in.

A Reprieve?

Since so many Morgan silver dollars were produced, even after the melt-off in 1918, the US Mint still had several large stockpiles in hidden away in storage. Finds were being made as late as the early 1960s at which time a large cache of Morgan silver dollars were discovered. This brought to light thousands of uncirculated coins, some of which were considered to be rare years and even rarer mintages. In the 1970s, the US Mint held a sale of uncirculated Carson City Morgan silver dollars, introducing a new generation to high value coins at an easily affordable price.

The Morgan Silver Dollar Today

Today, while it does depend on the condition and the rarity of the coin, Morgan silver dollars have become arguably the most popular coin for both collecting and investing. Coin prices rarely drop and with so many Morgan dollars available, the buy in for even the novice coin collector or a beginning investor is easily affordable. If you’re looking for a great way to start a coin collection, a great way to expand your coin collection or you want to find a great investment coin to enhance your portfolio and protect your investment dollars, going with Morgan silver dollars is definitely a great way to go.