Arguably the Morgan dollar is the most widely collected classic U.S. coin.
Silver’s rise over the past several years has generally strengthened
demand for Morgan dollars along with increasing supplies of the more
common issues, which the market has absorbed.
In circulated and low-grade Mint State grades, the market places a
premium on 1878 to 1904 issues versus the series-closing 1921 Morgan
dollar. However, as the price of silver has moved up, this price
differential has been shrinking. Broadly speaking, dealers sell bags
of these common dollars in several grades: culls, which are polished,
heavily worn or damaged coins; circulated, a broad range that includes
coins grading from Very Good to Extremely Fine; sliders, About
Uncirculated coins that are sometimes called “commercial
Uncirculated”; and finally, Uncirculated, which typically includes
Mint State 60 to 63 coins.
Typically, Morgan dollars finer than MS-63 need to be certified by a
third-party grading service to maximize their value, and the market
for MS-64 though MS-66 coins has been particularly volatile in the
past few years. Dealers often submit large groups of dollars to
grading services for bulk grading at steep discounts to retail grading
fees, which explains why so many common certified MS-61, MS-62 and
MS-63 Morgan dollars are in the marketplace when it would appear that
there is little financial incentive for certifying these.
The recent surge in silver brought millions of Morgan dollars to the
rare coin market, but most were generally low quality and the
population of higher Mint State coins did not increase substantially.
As a result, when the price of silver surged in 2011, so did the
prices of MS-64 through MS-66 common Morgan dollars. In April 2011, as
silver approached $50 an ounce, common MS-66 pre-1921 Morgan dollars
were trading for as much as $450. Considering that they started 2011
at the $250 level, such a rapid increase is remarkable. In February
2012, demand has declined from last year’s highs and handsome examples
may be found for $325 to $350, with low-end examples selling for as
little as $270 in some online auctions.
The Morgan dollar market continues to show a preference for either
brilliant coins devoid of toning or beautifully toned coins; off-white
or lightly toned coins are often discounted by dealers.
Today’s collectors look critically at their certified coins to make
sure that they buy coins that represent high-quality within a grade.
Auction prices and dealer comments both reflect a growing price gap
between high- and low-quality coins. Unattractive coins continue to
have a market, but the market is a step below the current retail price
levels listed by Coin World’s Coin Values. ■