The History Of The Morgan Silver Dollar
Morgan Dollars were ignored by most coin collectors for decades after the coin’s demise. It wasn’t until the early 1960’s that collecting Morgan Dollars started to become popular. At this point in time silver was worth around $1.29 per ounce. At this price, the silver metal value of a silver dollar was worth a dollar. Many banks still had bags and rolls of silver dollars and all you needed to do was go down to the bank and ask for them.
The Mint Act of April 2, 1792 provided for decimal coinage. The largest being the dollar, or 100 cents. Dollars were coined off and on until the coinage Act of 1873 eliminated the dollar and put in its place a slightly larger dollar called the Trade Dollar. The Trade Dollar was produced with the intent to export it for trade with China. As such very few made it into general circulation in the U.S.
In the meantime the silver mining industry in the west had fallen on hard times. The silver mining interests turned to the U.S. Government to bail them out of their situation. The idea was put forth that the U.S. government should buy silver bullion for its own account to help support the market.
Many prominent politicians jumped on the bandwagon with the idea that a strong silver market would benefit everyone west of the Mississippi. After much discussion and debate, the Bland-Allison Act was passed on February 28, 1878. The legislation was initially vetoed by President Rutherford B. Hayes, but Congress overrode his veto thus putting a new law on the books.
This piece of legislation dictated that the U.S. government would purchase $2,000,000 to $4,000,000 a month in silver bullion with the specific purpose to convert the silver into standard silver dollars (90% silver and 10% copper).
Back in 1876, the Mint Director Henry Richard Linderman anticipated that some kind of legislation would eventually be passed to create another circulating silver dollar and had Chief Engraver William Barber toy around with some possible new designs.
At the time the U.S. was without a dollar coin and much like today, there wasn’t much public demand for a dollar coin of any variety, silver or nonsilver. By 1877, it seemed like a sure bet that legislation for a new silver dollar would indeed become a reality.
A new design was needed and William Barber, Assistant Engraver George T. Morgan, and outside artist Anthony Paquet moved into high gear and produced several different designs. On February 21, 1878, Linderman selected the design.
While he thought Barber and Morgan had great artistic taste, he selected the design with the lowest relief requiring the lowest power to strike. This design had been created by Morgan. The portrait was modeled after 19 year old Miss Anna Willess Williams. Miss Williams had been used as a model for several pattern half dollars in 1877.
Within a week after the passing of the Bland-Allison Act, the first Morgan dollars were coined on March 7, 1878. After a few adjustments to the dies the Philadelphia Mint stated churning out 80 dollar coins a minute. Within a few days, several other presses would come online and dies would be delivered to San Francisco, New Orleans, and Carson City.
The purchasing power of a dollar in the 1880’s was huge! Most transactions of the day were completed in smaller denominations as large purchases were under a dollar. Additionally, many folks still bartered for goods.
As such, the supply of silver dollars far exceeded the demand for them. Incredibly the Bland-Allison Act was modified by the Sherman Silver Purchase Act which mandated that the U.S. government purchase 4.5 million ounces of silver per month.
The hitch was that these purchases were to be paid with Treasury bonds redeemable in either silver or gold which depleted the Treasury’s gold supply which triggered a financial panic through the whole country in 1893. This led to the repeal of the Sherman Silver Purchase Act. The result was a massive slowdown in silver dollar production for the years of 1993, 1894 and 1895.
Production picked up in 1896 but it would be a few years before production went back up above the 10,000,000 mark for individual mint. In 1904, the supply of silver was exhausted and the Morgan Dollar ceased production, or so it had seemed.
In 1918, congress passed the Pittman Act and recalled over 270 million silver dollars for melting. Total mintage of the entire series totaled nearly 657 million. Around 47% of the Morgan Silver Dollars dated prior to 1921 were destroyed.
These silver dollars had been sitting in Treasury vaults for years just collecting dust. One provision of the Act was for the recall of these dollars for the purpose of making new ones. So in 1921 the Morgan dollar was revived for one more year.
Later that year, the Peace Dollar would permanently replace the Morgan Silver Dollar. And with the paper dollar becoming more popular for commerce, dollar coins vanished from general circulation and piled up in bank vaults. Today, it is estimated that only 15-17% of all Morgan Dollars produced still exist today. Taking this into consideration, low mintage dates are even scarcer than their mintage would indicate making this a very desirable coin to collect.
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