The last time before the present that coin collecting was popular in the U.S. was in the mid to late 1960s. This mid-century renaissance in numismatics was primarily driven by the impending abandonment of silver in circulating coinage. For over 125 years, the U.S. mint had used a traditional alloy of 90% silver and 10% copper for nearly all of America’s circulating silver coinage.
However, due to the Kennedy administration’s involvement in the Vietnam conflict and the subsequent inflationary “guns and butter” policy of president Linden B. Johnson, the government began over-issuing currency. This inflation naturally led the price of silver to rise in the global market. By the mid 1960s, it had become apparent that the U.S. government would need to replace the silver used in circulating coins before the intrinsic (bullion) value of the pieces exceeded their face value.
This development in U.S. coinage policy cultivated intense interest among the public. One side effect was the increased popularity of coin collecting, particularly among younger people. Although it was the twilight of circulating silver coinage in the U.S., it was a golden age for casual coin collectors.
During this period it was still possible to find desirable and rare coins in pocket change. In addition, iconic older coin designs such as Mercury dimes, Standing Liberty quarters and Walking Liberty half dollars still circulated side by side with more contemporary Roosevelt dimes, Washington quarters and Franklin/Kennedy half dollars. Children and adolescents everywhere happily sifted through rolls of coins, looking for better date examples to save.
Gresham’s Law states that “bad money drives out good money”. Consistent with this ironclad economic rule, valuable silver coinage began to be pulled from circulation and hoarded by the mid 1960s. Coin collectors were blamed as the scapegoat for the resulting shortage of circulating coins, even though it was the government’s short-sighted inflationary policies that had driven up the price of silver in the first place.
Finally, in 1964, Montana senator Lee Metcalf sponsored legislation that temporarily froze the date on U.S. coins and eliminated mint marks in a misguided attempt to make them unpalatable to collectors. As a result, even though they were dated 1964, the last circulating 90% silver coins were actually struck by the U.S. mint in 1966. During this same period, the U.S. government also introduced our current, execrable copper-nickel clad coinage.
Although it took a few years, silver coinage inexorably disappeared from circulation. Once it became impossible to find good collector’s pieces in circulation anymore, interest in coin collecting gradually faded among younger generations. Although coin collecting was still popular in the 1970s and 1980s, the hobby was a shadow of its 1960s golden age.
By the 1990s, coin collecting had fallen on hard times. A bubble in third-party certified, or “slabbed” coins in the late 1980s had burst, devastating average collectors who had been sucked into it. At the same time, high quality, rare date coins from the 19th and early 20th century relentlessly rose in value, pricing collectors of modest means out of the high end of the market.
This unfortunate state of affairs only worsened in the early 2000s. By this time, the traditional hobby of coin collecting was clearly dying. The existing collector base was rapidly aging, most having started collecting during their childhood in the golden age of the 1960s. But there were almost no young coin collectors coming into the hobby to replace their graying ranks. This was at least partially due to the fact that, since the late 1960s, it was impossible to find desirable coins in circulation.
I got my start in coin collecting in the late 1980s and early 1990s. And I did so primarily by searching through rolls of half dollars and nickels for the odd, overlooked silver coin. Even back then, it was no easy task. Gresham’s law had done its wicked work all too well over the decades. I did find a few silver pieces though – just enough to keep me coming back for more.
My entrance into the hobby of coin collecting was only possible because of the low prices of gold and silver during that time. However, in my opinion, the days of sifting through rolls of circulating coinage from your local bank in order to pick out a handful of worn silver specimens ended about 15 years ago. By the mid 2000s precious metals began to skyrocket in value, thus depriving aspiring young collectors of even this meager avenue of participation. It looked like the hobby of coin collecting was destined for extinction.
But then a funny thing happened. Precious metal stacking, the name given to systematically buying physical gold or silver bullion for investment purposes, came to the rescue. In fact, I don’t think it would be an exaggeration to say that precious metal stacking literally saved the hobby of coin collecting.
Precious metal stacking is the purchase of gold and silver purely for bullion purposes. But, a significant number of stackers inevitably became interested in the numismatic aspects of bullion coins issued by governments. This might sound like a contradiction, but some modern, government-issued bullion coins, with their beautiful designs and near-perfect strikes, really do possess great numismatic potential.
It is a short step from precious metal stacking to searching for semi-numismatic, certified MS-70 examples of American Silver Eagles or Australian Gold Kangaroos. From there, new collectors can branch out in many different directions. Some gravitate toward older proof coins with their deep mirror finishes and historical importance. Others look back to the classic early 20th century circulating U.S. coinage that inspired many of today’s most popular bullion coin designs. Some branch into foreign coin collecting, drawn there by the plethora of attractive modern bullion coins struck by foreign governments. A few even look further back in time to the origins of coinage in medieval and ancient coins.
Precious metal stacking has completely revived the coin collecting industry. Not long ago, numismatics was a slowly dying hobby dominated by older collectors who were chasing the coins they fondly remembered from their youth. Now it bustles with the activity of thousands of new precious metal stackers using gorgeous modern bullion issues as their gateway to further numismatic adventures. No, coin collecting today is not the same as it was in the 1960s, but it is still here and vibrant, thanks to precious metal stacking.
