Creators Podcast
1849 Double Eagle Gold Coin
Episode #18
3.22.25
The 1849 Liberty Head Double Eagle
The more and more I learn about the most valuable rare coins, the more amazed I am at the crazy world events that were swirling all around at the exact same time a certain coin was created. And I can give you a few examples of exactly what I’m talking about.
This is what I’ve learned from my other coin episodes. The world famous 1933 double eagle was struck at the US Mint at almost the exact same time that unprecedented action was taken by President Roosevelt to save the entire financial system from a complete meltdown.
Another example, my episode on the 1794 silver dollar shows the extreme difficulty of not just writing all the rules and regulations of a new country trying to figure out how it was going to set up its financial system, but it then had to tackle the insane challenge of actually constructing a new mint building, staffing it and then trying to find people who knew how to create coins.
World History and Events in Coins
And at the exact same time the 1794 silver dollar was struck, you had George Washington himself walking around the mint building, inspecting the progress and reporting back how proud and excited he was about the new mint.
I thought this was great, but he was also running some silver through the mint presses that he brought from his own personal stash so he could create a few silver coins of his own so he could pass him out to his friends and relatives. I mean, what a sight to imagine.
So there’s just a few examples, but I think you’re getting my point. These coin stories give an insider’s look at some of the most insane and impactful events in world history. A view that you just can’t get from your typical sources. And that’s one of the reasons I love doing these episodes. One of my biggest challenges is to keep these episodes somewhat on track.
The Epic 1849 Liberty Head Double Eagle
Because I’m discovering so many new insights along the way with these coins, I could go in like 20 different directions. So that’s one of my challenges. And that brings us to the great coin that we’re going to focus on right now.
The epic 1849 double eagle, known as the Liberty Head double eagle gold coin. I love to start these episodes out with the big moment. A quote that just gets right to the heart of the matter.
And there’s no better moment for this coin than when just one year before, in 1848, gold is discovered, sparking one of the biggest events in US history, the California Gold Rush.
“Word soon spread, and before long, other workers at the sawmill were spending every available moment of spare time during daylight hours, poking in crevices and searching the American River streambed for yellow flakes and nuggets. Sutter urged them to keep the matter confidential, fearing that the sawmill, then only partially completed, would be abandoned, favoring the certainty of wages to the unknown possibility of finding gold, the workers agreed to stay with the project, limiting gold exploration to their extra hours.”
So that was an excerpt from a book I’m about to tell you about in just a minute. But what just happened in that passage I read was the very beginning of the California Gold Rush. And a very important phrase at the start of the quote was, “word soon spread.”
And we’ll look at this a little bit more and what happened when the word started spreading. But this is an amazing time to look back on.
The Gold Rush and Sutter’s Mill
Luckily for coin collectors, we have a great coin that marks all these amazing events. Like I said, it’s the 1849 double eagle. And the passage I just read was when the very first workers at Sutter’s mill realized there might be a fortune of gold in the nearby river.
And the passage says, Sutter tried to keep the workers focused on the mill, the project they were building. But after hours, the workers explored for more gold.
And you know what happens next. Just like the first phrase says from that passage, it says, “word soon spread.” So the workers went from poking around this river after hours because they had a job to do at the mill, but then very quickly word spread and it was an all out gold rush.
David Bowers and His Awesome Book
So I can’t possibly try to tell you all about one of the most famous rare coins in the world without first reading a few great books on the topic.
So I found another beauty. And you probably won’t be surprised at this point if you’ve listened to any of my other rare coin episodes, but this book was written by Q. David Bowers.
First published in 1982, the book is titled, ‘United States Gold Coins: An Illustrated History.’
And this book is amazing and I would strongly encourage you to go try and find a used copy of this book. It’s a giant book that’s full of historic photos and details of each gold coin ever produced by the US Mint.
The Full Story of Gold Coins
But it also tells the full story of how and why gold coins were produced in the United States. And from a coin collector’s perspective, and I think that’s one of the reasons I’m always returning to the books by David Bowers.
Because they connect big time historical events with the coins themselves. And I’m finding this to be a very enjoyable way to learn about history. And if you would have told me this just a few years ago, I don’t think I would have understood it completely. But after doing it for a while now, it’s been really interesting to get this point of view.
So Bower’s books always go much further than you would expect. He goes beyond the straightforward history and he has a great way of connecting the coins with all the legendary collectors who’ve owned them over the years.
There’s Only One 1849 Double Eagle
Now there’s another important idea I found while learning all about the 1849 double eagle coin and something I didn’t know going into this story. And I should have known this but really had no idea.
There’s only one known 1849 double eagle coin to exist. That we know about. And that one coin is resting safe and sound at the Smithsonian along with so many other great coins.
The Most Valuable Coin in the World?
This one single coin produced in 1849, it was actually a pattern coin and was never in circulation. But there’s a pretty strong argument that this is, in fact, the most valuable coin in the world if it was to ever sell publicly.
So we’ll look at this debate a little later. And it’s a great debate.
It’s like if for all you baseball fans, there’s a great debate over like who’s your starting lineup of baseball legends out of all the eras and who would you put at each position? And the debate rages on about who you would include and who was left off your all time lineup.
The Great Coin Debate
And there’s the same great debate for coin collectors. It’s the greatest coins of all time list and the coin collectors will debate over maybe 10 or 15 different coins that are extremely rare and historic and rank them in order of importance or value.
And then they’ll debate why someone ranked one coin over the other. So this is one of those coins and it’s at the top of the list as I learned this week.
For many of the most well-known coin experts and collectors, many of them rank this coin right at the very top of the list. Now we need to learn a little bit about this coin before we go any further. Gold has just been discovered in California in 1848 and the gold that was discovered would eventually get shipped back to the US Mint where it would soon be used to create the very first double eagle gold coins just one year later.
The New Double Eagle $20
Up to that point, the highest denomination gold coin in the US was the Eagle coin, which was worth $10. But now, along with this gold discovery, the Double Eagle, which was worth twice the Eagle coin, so it’s worth $20.
Now the Double Eagle was ready to hit the scene. There’s some debate by politicians that there’s no need to create a Double Eagle coin. The critics in Washington DC said the Eagle coin was being doubled into a ponderous and unparalleled size, is one quote that a politician had.
But with the discovery of gold out west, nobody’s going to win that argument anymore. The government needs to make bigger gold coins because now there’s more supply of gold and the mint could process more of this gold into coins with the least amount of effort by the presses.
Basically, they could mint four times the value as the $5 half eagle, and then twice as much as the $10 Eagle coin with the same amount of effort by the Mint presses.
James B. Longacre at the Mint
So the chief engraver at the Mint is James B. Longacre and there’s a power struggle going on at the Mint between Longacre and the Mint director Robert Patterson. So Patterson and a few others nearly get Longacre fired.
But he’s able to survive this conflict at the Mint and is somehow able to keep his job and then proceeds to create the design for the new Double Eagle coin.
Now, side note on Longacre, he would go on to design several other historic coins, the Shield Nickel, the Indian Head Nickel, the Three Cent Piece, the Two Cent Piece, and the Flying Eagle Cent. So a lot of coin collectors know the name James B. Longacre from some of these other coins.
And when Longacre passed away suddenly in 1869, the guy who would replace him as chief engraver was William Barber. And that name should be familiar also because 10 years later William Barber passes away and it was his son who succeeded him as chief engraver at the Mint, a man by the name of Charles Barber.
And if you listen to my episode on the 1933 double eagle, you know who Charles Barber is. He would soon go head to head with Augustus Saint Gaudens in a classic coined creator story and the epic mint showdown of 1907, guess I could say this, it was Barber who was almost like the villain in the creator story of the Saint Gaudens double eagles.
Another Amazing Coin Creators Story
And that’s a great story if you haven’t listened to it yet, check out that episode I did and my favorite character of all time, guess you could say President Theodore Roosevelt was right there in the middle of it, battling and fighting his way through the politics of Washington DC and Charles Barber at the Mint, and trying to get a few coins redesigned.
So that was an amazing story. So anyway, we have to get back to these 1849 double eagles. So Longacre’s at the Mint designs the coin and the first patterns are made in 1849. This is where things get really interesting and we need to take a look at this.
I read David Bower’s line in his book about this a few times just to be sure I was reading this correctly. But there’s a handful of brand new double eagle gold coins, which were proof coins or pattern coins, and they made a few pattern coins in late 1849.
Now we already talked about the one single known coin that’s in the Smithsonian. We talked about it earlier. It’s the only 1849 double eagle to exist, making it possibly the most valuable coin ever created. But let me just read this passage from Bauer’s book. You can hear it for yourself right here –
“By the end of 1849, at least two gold impressions of the 1849 dated double-legal dyes had been preserved, one of which was sent to Secretary of the Treasury W.M. Meredith, and the other of which was placed in the Mint collection. Today, the Meredith specimen is untraced. The Mint collection piece is a featured exhibit at the Smithsonian Institution.”
Okay, hold on.
Is There A Second 1849 Double Eagle?
We need to talk about this. Bauer’s book written in 1982. He’s one of the most knowledgeable coin experts maybe ever. But David Bauer has just said that at least he said quote, at least two gold coins were minted.
One was preserved. The other was sent to secretary of the treasury W. Meredith. And that coin is untraced. That’s what Bower’s just said in his book. The other is now in the Smithsonian. So where did the other coin go?
Now it gets even better.
Where is the Other 1849 Double Eagle?
The book goes on to say that on December 25th, 1849, so on Christmas Day, 1849, the Director of the Mint, Robert Patterson, and the same guy who was trying to get Longacre fired, that guy, the book says Director Patterson, quote, “Informed Meredith that a number of 1849 double eagles have been coined by the ordinary steam press and the unhappy result has been reported to me.”
This is what Patterson is reporting to the Secretary of the Treasury, Meredith. Then this is David Bauer’s book that has this quote. says, Patterson informed Meredith. It is presumed that these specimens were destroyed.
Okay, so if you’ve listened to a few of my other episodes on the greatest coins of all time, you’re now familiar with a few of the great coin collectors.
The Greatest Coin Collectors Were Savvy
We talk a lot about these collectors and these collectors go way back almost to the very beginning of the US mint. They were busy collecting coins and they were very, very smart.
They spent lots of time on their craft and studying and locating the most rare coins ever made. And even though this is way back in 1849, it’s still after the mint cabinet was created so they could store the country’s official coin collection.
So rare coins were already a thing at this point. And we know how crafty some of these original US coin collectors actually were because of the 1804 silver dollar story.
In that episode, we talked about how a few coin collectors who also worked at the mint started restriking coins of earlier dates because they found out they were rare. And there was a market for these rare coins already.
And they actually restruck a handful of 1804 silver dollars all the way in 1834 because they realized they were in demand by collectors. So the point I’m trying to make here, guess, is after hearing some of these other coin stories, there’s some insider trading, you could say, going on at the mint even way before this double eagle story started.
So it’s not out of the question, that when you hear a mint official say that certain coins were produced and then destroyed, it’s just hard to believe that as absolute fact, I guess.
That’s my gut reaction after hearing that line in the book. So I did a little more digging on the possibility that these other 1849 double eagle coins actually survived and that they’re out there somewhere, even though officially there’s only one known coin at the Smithsonian. And here’s what I found, because this book by David Bowers is now over 40 years old.
What Do the Coin Experts Say?
So what’s the latest? I went to the PCGS website, which is one of the top coin grading companies out there. And on their website, I found the page covering this 1849 double eagle. On this webpage, it says, proof coin, population one, image courtesy of the Smithsonian. And it has a picture of the coin. Then it says, estimated value, $25 million. And then it also has some commentary.
It has a few well-known coin experts adding their thoughts on the coin. So David Hall comments on the coin, and I think he’s one of the founders of PCGS, but David Hall writes, says,
“Walter Breen has written of the 1849-20 that at least two proofs were coined on December 22nd. One of these is in the Smithsonian Institute. The other went to Treasury secretary, William Meredith. This statement seems to indicate that there may be another 1849-20 floating around somewhere. But I agree with Dave Bowers when he warned that Breen’s statement must be taken with a grain of salt. And I personally feel the existence of a second 1849-20 is beyond improbable.”
Okay, so there you have it. That’s David Hall says it’s, “beyond improbable,” there’s another second 1849 double eagle coin out there somewhere. Now on this same page on the PCGS website, another coin expert and legend, David Akers chimes in on the 1849 double eagle.
It’s Not Clear If There’s Another Coin
So check this out. David Akers says about the second coin that was given to secretary of the treasury, William Meredith. He says the coin is thought to be in the possession of Stephen K. Nagy, the famous Philadelphia coin dealer, since there’s a photograph of it in his estate.
And then he says the late James Kelly, another well-known coin dealer, “Had firsthand knowledge of quote, the existence and whereabouts of a second specimen.”
But then David Akers goes on to say if there’s a second coin, it’s unknown to the numismatic community. Then he says this quote, “Its very existence must be considered a matter of conjecture.”
So there we go. Two very respected coin experts. One saying it’s beyond probable. The other saying it’s a matter of conjecture. Now I know there’s people out there who might be listening to this right now with better knowledge of possibly another 1849 double eagle out there. Somewhere.
And part of the fun for me in doing these episodes is hearing from a listener wherever you may be.
But if you have a better understanding of the possible whereabouts of another 1849 double eagle, I’d sure love to hear the story. And I know after learning all about the great coin collectors, I can bet there’s collectors out there who’ve been searching for these other 1849 double eagles for like the last 40 or 50 years now.
So I know you’re out there and let me know if you have the full story on any other 1849 double eagle coins. I’d love to hear about it.
Back to Sutter’s Mill and the Gold Rush
So this is still just the proof coin that we’re talking about here in 1849. Now the gold rush in California is fully underway by 1850 and that gold starts pouring back into the system. The U.S. Mint begins production of the 1850 double eagles by the millions.
Actually just over a million double eagles were struck in 1850, but then over two million double eagles were struck in 1851 and another two million in 1852.
And then there’s several very rare double eagle coins that were produced in the 1850s as well. And those coins are extremely valuable today. The 1854-O from the New Orleans Mint is one of them where only about 3000 were originally produced.
And now only about 20 or so are remaining in collections. Then there’s another double eagle from the New Orleans Mint, the 1856-O and there’s just so New Orleans Mint again, and there’s just 15 known pieces from that mintage.
So this is just another reason to love coin collecting and why collectors spend entire lifetimes tracking down and collecting rare coins. There’s intrigue here and a little mystery and there’s a chance there could be another 1849 double eagle proof coin out there. And how crazy would that be to have it surface at some point? Now we have to look at the gold.
The Gold at the Mint
Double Eagle production is underway and rolling off the mint presses in the 1850s. And gold is absolutely just pouring in from California. So David Bowers has a ton of great stories about the beginning of Sutter’s Mill and just how fast the gold rush took off.
But we didn’t talk about what started it all. I think the very first discovery of gold at Sutter’s Mill was pretty cool and that’s what lot of collectors dream of. Stumbling on a treasure or a super rare coin, or finding an amazing sports card at a thrift shop somewhere, or just finding a famous painting tucked away in the attic.
It sounds so exciting, and you would think it would be such a thrill to discover a river packed full of gold on your property.
But when you start reading into details about the gold rush and how fast it took off and what a craze it became, you can see the realization set in pretty quickly.
The Excitement and Frenzy of the Gold Rush
After that initial excitement of the discovery, there’s quickly a realization that discovering gold on your property might not be the best thing to ever happen. So let’s get into this a little bit. Here’s David Bauer’s introduction to the gold rush in his book. And I like this passage because it really sounds like a dream come true initially.
So let’s read this first. He says –
“Of the events in United States history, the California gold rush is one of the most significant and romantic. The discovery of gold in January 1848 set the stage for the westward expansion, which ultimately was to define the boundaries of the United States as we know them today.”
But like we’re talking about, this is called the gold rush for a reason.
It’s a race for gold, like a craze almost. And why did people go crazy for gold? There’s another reason in the book that I didn’t know about.
So some gold miners were not just looking for a few nuggets. And Bauer says this is in his book. There was this thought at the time that there was the mother lode was out there somewhere and this might be it. Here’s what I’m talking about.
This is from the book, “In California, as in Georgia, North Carolina and other locations in the United States, gold was discovered in the form of alluvial deposits, flakes, nuggets, dust, and lumps mixed with sand in stream beds or in loose sand or soil. It is presumed that the gold was once part of a rock formation or load which in earlier times had broken away or had become eroded. Hence following the vast discoveries in Northern California in 1848, miners working stream beds always dreamed of finding the so-called mother load, where gold was believed to exist in nearly pure form and in large quantities in the earth.”
Searching for the Mother Lode
And there you go. So the search was not just for a few gold pieces. Some people were looking for that giant rock formation of pure gold, almost like an unlimited treasure underground. They thought it was out there somewhere.
And this is what I’m talking about. It was an exciting discovery. Then as you keep reading, you see why they call it the gold rush, there were suddenly over 10,000 people on both sides of this river searching for gold and so many people that they couldn’t really even keep track of how many there were.
People Swarm to the Mill
So check this out, when Sutter discovers gold, brings it to get tested and there was no possible way to keep this a secret. He tried to keep it quiet, but this is the quote I read earlier at the beginning of the episode, words started to spread. Anyone who he talked to urged him to keep this matter confidential, please.
Like the quote said from the book, but there was no possible way to stop what would become the rush. And then here it is, even though Duterte was pleading to keep his gold discovery a secret, even Sutter himself couldn’t stop talking about the gold.
He actually wrote a letter to a friend and he said, and this is from the book as well, he wrote,
“I have made the discovery of a gold mine, which according to experiments we have made is extraordinarily rich.”
And not only that he’s telling people about his rich discovery, but it turns out he didn’t even officially own the land. So he tries to, as quickly as he could, confirm ownership of the land. So he reaches out to this Colonel R.B. Mason through a trusted messenger.
Sutter Scrambles to Secure the Land
That’s what the book calls him. So this guy Mason was the chief representative of the U.S. government in California. So the trusted messenger that Sutter sent, a guy named Charles Bennett, was specifically told to not say anything about any gold.
But Sutter instructed Bennett to secure the land of all rights for lumber milling, pasture use, and mineral privileges.
And then Sutter had this plan already that if they asked why he wanted mineral privileges, his messenger Bennett was supposed to tell them it was for lead and silver that might be in the soil. So no mention of gold. It’s lead and silver we’re after. But his secret plan was fumbled by his messenger.
When Bennett was on his way to do all this, he stopped at a store on his way to secure the land rights and he had a buckskin bag with six ounces of gold inside. And at this store that he stops at, the story goes that Bennett the messenger, “Dazzled several listeners with stories of the gold discovery, showing them physical evidence.”
So it took just a few months from the discovery to then a few dozen people showing up and the numbers grew to 800 people, then 2000. And not long after that, over 10,000 people were searching the river and it would get wild. As you can imagine, this is a party that anyone’s invited to. Any and all types of people are showing up and lots of people are finding gold, which is making things even more intense.
The Gold Rush Craze
The book describes the amount of inflation that’s going on in this area because now people are walking around with pockets full of gold all over the place. So gold is plentiful in the area, but other things that are in high demand for these 10,000 plus people, those items start to get really expensive.
Like food, supplies, horses, doctors, guns, bullets. There’s a story about a shop nearby selling lunch, and it cost $43 for two people to eat lunch, which in 1850 is a ton of money for a meal for two people.
From Dream to Nightmare
So this is not a dream that many people are experiencing. It turns into really tough conditions and it’s also super dangerous as you can imagine. There were certain people who showed up out West and they called them ruffians and the book says they were from Indiana and Missouri.
There’s another quote in the book from this one historian. says, “After the Missourians began to come, insecurity increased. 1850, things had reached such a path that male agents were afraid to carry gold, lest they should be murdered.”
And then David Bowers, he says this again in his book, being in the area, this gold was not for the faint of heart, for lots of reasons. Here’s his quote –
“Disregard for life and property was engendered by the miners’ lifestyle which included excessive drinking, carrying weapons day and night, and a sense of remoteness from civilization. It was literally each man for himself. It has been estimated that by 1854 there had been 4,200 murders, 1,400 suicides, and 10,000 other unfortunate deaths in the mining fields.”
So just brutal things going on around this gold rush like the books describing here. It’s remote. There’s no law enforcement. People are finding lots of gold, but then trying to survive at the same time.
So you can imagine the chaos that could break out at the drop of a hat. But they did find gold. There’s no doubt about that. And not everyone got rich from the gold rush, but they did extract an enormous amount of gold. Remember, much of that gold would be sent back to the U.S. Mint in exchange for coins.
Millions of Ounces of Gold
And the book does have some estimations on how much gold was discovered around this time. So in the year 1849, about 500,000 ounces of gold were extracted. The next year that figure quadrupled to about 2 million ounces.
Then by 1852, 3 million ounces of gold. And then roughly that amount would continue to be discovered each year all the way through 1856.
The exact amounts are disputed a little bit, but depending on the source you’re reading. But these numbers that I’m reading are from the historical statistics of the United States, which was published by the government back in the day.
But to put this into perspective, one double eagle gold coin is made from almost exactly one ounce of gold, just short of one ounce. So it’s 0.09675 ounces is what one double eagle gold coin is made out of. So almost one ounce of gold.
So this is the equivalent of millions of double eagle coins that are getting extracted out for several years in a row from this California gold rush. Now millions of ounces of gold from this gold rush are pouring back into the U.S. Mint buildings.
And then they’re using them to produce millions of double eagle gold coins. And they would distribute some of those. But $20 back then is a lot of money. So much of the newly minted double eagle gold coins would remain at the treasury or in the bank vaults.
Gold for Economic Growth
Then they could be used for large currency settlements with foreign governments. It was really nice to have all this gold in the vaults. And what happens as we get closer to the turn of the century around 1900, the fear of paper money was subsiding.
The book calls it, “Widespread fear of paper money that people had in the mid 1800s was easing.” Now, citizens no longer demanded the physical gold to make transactions.
People just began to come around to the idea of paper money. And for one big reason, was just easier to carry around paper than these big bags of gold coins. You didn’t have to carry these big heavy coins everywhere you went.
From Gold Money to Paper Money
You could just leave the coins in the bank and use paper money, knowing that the paper was proof that you own gold coins back in the bank vaults. Which leads me directly to another big idea in all of this. And I haven’t mentioned the subject or the phrase this entire episode until now, but I’m going to have to say it.
It’s the gold standard. So this is one of the main themes while learning about gold coins and gold mining and the history of the US mint. It’s the gold standard. And David Bauer’s book gets into this subject too. There’s no way around it.
The Gold Standard
And he talks about how all this gold saved in the treasury vaults was used for payment settlements by governments. And then he adds a quote. says, this concept was furthered by the so-called gold standard system, which the United States adopted in 1900, being one of the last developed nations to do so.
So learning all about the history through the creation of these amazing rare coins, there’s always talk about the gold standard. Almost all roads lead to the gold standard is what I’m finding.
So check this out, my episode on the 1933 double eagle, which was all about the crazy economic events during the great depression leading right into March of 1933, when FDR was sworn into office, and then FDR along with steady handed William Wooden, they saved the entire financial system from the brink of collapse.
Then almost immediately the US government began recalling all the gold back into the bank vaults and the treasury to shore up the system. What would really be the entire world economic system at the time and the driver of this huge effort to turn around the banking panic and get out of this great depression.
The big driver behind all of this was recalling the gold and stockpiling it back into the bank and the government vaults, melting it all down into bars and then storing it into what would become Fort Knox.
All the Gold in Fort Knox
They just had started building Fort Knox right after this crisis. So by 1936, Fort Knox is completed and all the newly created gold bars are stored there to boost the confidence of the people, knowing that their paper money is now trusted because there’s an entire huge building full of gold bars sitting in the middle of Kentucky.
The book goes into the history of the gold standard and it explains how the idea began as a way to avoid hauling around gold just because it was heavy and it wasn’t safe to carry lots of gold around.
So banks and goldsmiths would keep gold for customers and then just issue receipts as proof of your gold. And then you could always redeem the receipt, the gold if you needed it because you knew somebody was safely holding it for you.
And then banks went one step further and they realized they could issue more receipts than there was gold kept in the vaults. And nobody would know the difference or care just as long as everyone didn’t try to redeem their notes for gold all at one time.
The History of the Gold Standard
And I like this super simple description that David Bowers gives on how the gold standard was created and you can easily see the problem here, which started out as a convenient way to not have to carry gold around.
You can see how when people didn’t have their gold and they just had the note in their hand, all it took was for one little doubt to creep into your head.
Just one little thought telling you, maybe my gold locked in the vault is getting passed out to someone else, leaving me with nothing when I go to redeem my receipt. And that’s why they called them financial panics.
These financial panics would break out because everyone got fearful or had these doubts in their minds creep into their minds all at the same time and they panicked. And once in a while, certain banks didn’t actually have all the gold that they issued notes for, which was a bad deal. And there’s hundreds of years of financial panics, the same basic idea just playing out over and over and over again.
Gold Standard Evolution
And then so certain so countries actually really tried to prevent this from happening. There were legal restrictions put in place where banks, they couldn’t issue any more paper money than they had the gold to back it up. And through the entire 1800s, countries were getting on board with this gold standard system. And then the US officially joins the gold standard system in 1900.
So like Bowers said earlier in his book, countries could make big trade deals with each other because everyone had a lot of gold stored in their own vaults then all the gold didn’t have to move you could just pass these certificates back and forth and then World War one breaks out in Europe and All sorts of craziness starts and there’s no way we can get into the financial history of World War one right now I don’t understand it myself, but because it’s just wild and crazy.
But there’s actually hyperinflation and there’s stories of how in Germany people were using wheelbarrows to haul their paper money to stores just to buy a loaf of bread.
So the paper money was a big issue at some points during World War I, all the way through the early 1900s. It was wild. Then there was the roaring 20s in the US and the big stock market crash at the end of that decade, sparking the Great Depression. And of course, the amazing year of 1933, my episode on the 1933 Saint Gaudens Double Eagle was all about this exact story.
And then how FDR tackled this issue in the early days or even early hours of his presidency just after he’s sworn into office. And this is why these coins are so cool, really. There’s lots of reasons people love to collect coins. This is one of my favorite reasons. You can go through almost the entire world history by studying rare coins. Check this out.
The Gold Rush to the Double Eagle
We started this episode with the discovery of a gold nugget in California that sparks the gold rush in 1848. The very next year, the US Mint creates the first $20 double eagle gold coin, the very first of what would be millions of double eagles that would spread all around the world and sit in vaults to back paper money that people in governments were beginning to figure out was just as good as gold. But it was easier to carry and easier to make deals with.
So with all this new gold in the system, more paper notes and certificates could be created to make investments and then grow the economy.
These very first double eagles, the Liberty Head double eagles, rolled off the mint presses for over 50 years beginning in 1849. This just happens to be 50 of the wildest, craziest, and most interesting and fascinating years in American history. And these coins were right in the middle of it.
That’s why I love learning about coins. It’s an almost infinite amount of history, all beginning with one single coin. The 1849 Double Eagle. It’s incredible.
Let me give you just one more example because this just happened. And I was just thinking about this story and the great book by David Bowers. So I look up and I have my bookshelves right in front of me and my book collection is growing by the day, but there’s a few hundred books in front of me. So to prove my own point, I walk up to my bookshelf.
World History Through the Eyes of Gold
And I realized that dozens of these books I could pull off the shelf that are from this exact 50 year period from 1849 to the early 1900s. All my biographies on the big tycoons and titans. There’s Andrew Carnegie. He’s doing his thing right during all of this.
Of course, Rockefeller. I pulled a few good Nile Ferguson books I have. One’s called, “Empire, How Britain Made the Modern World.” Another one was, “The House of Rothschild.”
There’s another book I have, it’s called ‘The History of Money,’ by Jack Weatherford. Almost half of the book talks about the gold standard. So I flipped to the index in the back of all these books and I went to the term gold standard.
And these books have dozens of pages referencing the gold standard. So it’s pretty crazy doing these episodes on coins now. I’ve done a handful and each episode really just opened so many more doors for discovery.
Almost half my entire library that I’m staring at right now is getting tied together by these coin stories as I learn about each new valuable rare coin. And I definitely was not expecting that to happen. But it’s been a lot of fun and I can imagine that other coin collectors might get a kick out of this exact same thing.
Half My Book Collection Talks About Gold
Let me give you another quick example. If you’re not already sold on the thrill of coin collecting, I’m pulling books off my shelf that might fall into the same 50 year period of time as these first Liberty Head Double Eagle coins. Books that might deal with the gold standard, how gold was handled in the economy back in these days.
And quickly I have a stack of a dozen books on my desk. So I stopped doing that because I don’t feel like pulling every book off my shelf. But something I haven’t mentioned yet. It’s the Civil War, which broke out right in the middle of when these Double Eagle coins were created.
From 1861 to 1865, the Civil War was raging in the United States. And I started flipping through a bunch of other amazing books on my shelf. And guess what? These double eagle coins and gold mining and the gold standard, these were all very important events during the Civil War for a lot of reasons. So I walk up to my shelf and I grab my copy of, “Grant,” by Ron Chernow.
The Civil War and the Gold Rush
This is an incredible biography on Ulysses S. Grant. So I flip to the index in the back of the book. I go to the G’s and what’s there? Gold. Gold Rush. Gold Standard. All of these things we’ve been talking about.
Probably 30 or 40 pages of information on everything we’ve just been talking about right in the middle of this amazing book on Ulysses S. Grant that now I need to reread all these pages because it’ll probably make a lot more sense to me than when I first read this book.
But anyways, like I said, this is a lot of fun for me just tying these stories together and seeing the same historical periods from all different perspectives. It’s been a ton of fun and I’ve been learning about this stuff for many years now, but it really feels like I’m just getting started.
So we need to wrap this up for now. And the wild and crazy story of the Liberty Head Double Eagles that all started with the very first pattern coin, the 1849 Double Eagle.
The Amazing 1849 Double Eagle in Washington D.C.
If you’re ever near Washington DC, this coin’s sitting in the Smithsonian, so go check it out. I’m definitely going to look for it next time I’m on the East Coast.
And remember, if you’re just getting into rare coins, some of the most respected and knowledgeable coin experts consider this very coin to be number one on their list. The most wanted coin if they could pick any one in the world.
Even JP Morgan himself tried to buy this 1849 double eagle coin and not even one of the most powerful humans on the planet could figure out a way to purchase this coin. There’s a story that he once offered the mint collection $35,000 for this coin back in 1909, but they wouldn’t sell it.
So one of my favorite takeaways from this episode is just how enjoyable it can be to look at history through the eyes of the coin collector, and then sort of triangulate a certain period of time with all these additional sources, but starting out with the classic coin like the 1849 double eagle.
The Greatest Coin Experts
And we’re really lucky to have all these great coin experts like Q David Bowers, who spent entire lifetimes documenting the crazy twists and turns of these coins. I would strongly urge you to go buy a copy of his awesome book. It’s United States Gold Coins, published in 1982. It’s a great read.
Do me a favor and share this episode with someone you who might enjoy the creator’s story of possibly the greatest coin of all time. And let me know what coin would be on the top of your list if you had to pick the one single coin to own over any other.
So have a great rest of your day and I’m hoping you can find a way to encourage someone to dig a little deeper into a subject that they’re interested in. You never know when you might uncover that gold nugget – that changes your entire way of thinking.