Shield Design Begins Nickel Series|
July 10, 2013
Ever get the urge to go back to the beginning of nickels in 1866 with the Shield design? The series has more going for it than many might suspect.
Because of its copper-nickel composition the Shield nickel quickly displaced the tiny five-cent half dime silver coin.
Sure, there was a special silver alloy for the denomination 1942-1945 during World War II, but with that exception, the nickel has maintained the same composition since the year after the Civil War ended. No other denomination has been unchanged in its composition for the same period. That alone might buy respect for the denomination and the Shield type.
There is certainly no doubt that the Shield nickel, or any nickel for that matter was high on the agenda when lawmakers back in 1792 were trying to decide on the first coins of the United States. The five-cent denomination was approved in silver. It came to be called the half dime.
People were apparently willing to use it despite its inconveniently small size of 16.5 millimeters and then 15.5mm. The current dime is 17.9mm if you need something familiar to compare it to.
But it was good silver. That was what mattered in a period not long after the Revolutionary War in which paper money had been issued by the Congress and had lost its value. Lawmakers knew that the public was not going to get burned again.
Moreover, with small silver coins of other nations in circulation, the United Stats was going to issue its own silver coins in an attempt to displace them. The reason for a change in the good silver half dime did not emerge until the Civil War.
When the Civil War began in 1861, both sides thought it would be over quickly. When that did not happen, people began to hoard coins. First gold, then silver and finally even cents were hoarded.
It did not happen overnight and it was a natural reaction to the hopeless results of the Union’s first battlefield experiences combined with the knowledge that neither side would give in to the other in any way.
Huge expenses were being incurred by both sides. Both sides resorted to printing paper money to make payments.
Coin hoarding in the North reduced the public to using stamps and then tokens as change. Fractional Currency notes were issued with denominations as low as three cents. What were desperately needed were coins of low denominations that would not be hoarded.
There is little doubt that had the war ended quickly there never would have been some of the special coins that were approved during the war. The problem was that the war simply got worse for years on end. Even in 1864, until Atlanta fell, Lincoln expected to lose the election because the North just could not seem to win a final victory.
The situation in commerce went from bad to worse even as the Union Army began to improve its position after chasing Confederate troops out of Pennsylvania after the Battle of Gettysburg in 1863.
In December of that year, the Philadelphia Ledger asked, “Where are all the cents? Being depreciated below their nominal value they are not exported and considering what a nuisance their abundance was before the suspension of specie payments, and their immense coinage since, it is a general wonder where they all can be hid.”
Why the public was hoarding what were since 1857 copper-nickel cents is a matter that is still hard to explain, but it helped to create an attempt to solve the problem other than by using Fractional Currency, which few liked. The first step was to make a change to the cent. It was decided to copy the bronze tokens that merchants had tried to use in lieu of cents but that Uncle Sam frowned on.
In 1864 the Indian cent composition was changed to a bronze alloy. A two-cent made of bronze also appeared in 1864.
The bronze issues were a start, but they were not music to the ears of Joseph Wharton. It could be said that Wharton was the first real lobbyist for mining interests, which just happened to be himself as he was the owner of the only nickel mine in the United States at Gap, Pa.
Naturally seeing the end of the copper-nickel cent upset Wharton. So in 1865 the United States adopted a three-cent nickel coin. This was followed May 16, 1866, with legislation calling for a copper-nickel five-cent coin.
In fact, the legislation went further, allowing the new coins to replace withdrawn Fractional Currency notes of the same denomination. This was brilliant. Suddenly it became a question between a copper-nickel coin as an alternative to hated paper money rather than silver. It was the unpopularity of the notes that opened the door to the new nickel.
The alloy used by both the three-cent piece and the five-cent piece was different from the Indian cent alloy. It was 25 percent nickel and 75 percent copper. The composition of the Flying Eagle and Indian cents had been 12 percent nickel and 88 percent copper.
Even the three-cent piece earned the nickname “nickel” before the Shield nickel appeared the next year.
The new Shield nickel would be the last of the Civil War inspired coins. While the coin might have had advantages, few would have suggested at the time of issue that one of them was the design. It was the work of James B. Longacre. He had prepared other designs, including one using George Washington. In most minds, the design chosen was the least interesting.
Over the years, the art critics of America have had a field day coin designs. The Shield nickel was no exception. In this case, however, even the biggest proponent of the copper-nickel five-cent piece was not pleased as Wharton commented that the new coin was a “curiously ugly device,” suggesting to anyone who would listen that the obverse resembled “old-fashioned pictures of a tombstone.”
Wharton was not alone in not liking the design. The American Journal of Numismatics called the new coin the “ugliest of all known coins.”
Even with less than enthusiastic reviews, the Shield nickel was so badly needed by merchants that its first mintage was a large one of 14,742,500 pieces. That was all the more interesting in light of the fact that silver half dimes were still be produced in small numbers.
The first 1866 nickel is available today for $29 in G-4 while an MS-60 is $280. If you would like one in MS-65, the price rises substantially to $2,050.
From the coins we see today, there is evidence the Mint was having a hard time striking the new alloy properly. Even on very nice coins we find some evidence of weak striking and possibly cracked dies.
Collectors looking for top quality examples have in some cases sought to find them in the proofs of the period and the Shield nickel proofs make an interesting group. The mintage of 1866 proofs is put at 500, as proofs were popular at the time as a way of acquiring examples of new issues every year for a minimal price. The problem that first year was the new coin appeared too late to be included in the regular proof set. That creates confusion as to how many were sold at the time.
We know the proof 1866 is tough. It has a price of $3,450 in Proof-65, although finding one can be difficult as the problems that plagued Mint State examples were also sometimes seen in proofs though less pronounced.
The striking problems created instant concern at the Mint. The belief of officials was that the rays on the reverse were the source of many of the striking difficulties. The reason is they required a high degree of metal flow to fill all of the cavities in the die. This caused enormous die stress and they wore out or broke quickly. The rays were dropped for 1867 and later issues, though not before 2,019,000 1867 nickels with the rays were coined. That smaller total makes the 1867 with rays a better date. It is $37 in G-4, $330 in MS-60 and $3,850 in MS-65.
Unlike the 1866 there is not really a proof alternative for collectors looking for a way to avoid the striking problems seen with the issue. In fact, there were not supposed to be any proofs, yet a few exist. In research by R.W. Julian it appears that the Chief Coiner Archibald Loudon Snowden had refused to make any proofs knowing that the order to change the design was coming. He was right as the order for a change came on Jan. 21, 1867, but it appears that someone went ahead with a small number of proofs anyway.
The “with rays” proofs did not appear in any sets and the number produced would have been very low, with some estimates at 30 coins. Walter Breen estimated that perhaps 12-15 exist, but whatever the actual number, it is likely that some are impaired or have the regular problems associated with the rays reverse. The Proof-65 Coin Market price is $75,000.
Numbers from the Professional Coin Grading Service, which might include some repeat submissions, show 45 examples of which 25 were graded Proof-65 or better. Numismatic Guaranty Corporation shows 12 examples of which six are Proof-65 or better. Clearly Breen’s estimate can now be seen as too low.
One thing the removal of rays did accomplish was to seemingly spur higher mintages. Every year until 1871 saw high mintages. Less than a million were struck in 1871. The Mint had clearly caught up to demand.
Those 561,000 1871 nickels compare to 4.8 million coins of the year before. As a result, the G-4 1871 is $72. The MS-60 is $415 and the MS-65 is $2,100. Proof-65 pieces at $910 are less than half the MS-65 price. This reflects increasing proof sales over the period.
The 1873 is another date worthy of mention. It came with either an open or closed “3.” The varieties were the result of the fact that officials did not like how the “3” looked and ordered a more open look for the numeral. The open “3” is more available, with the suggestion being that it is about two-thirds of the entire mintage.
This shows in prices. In G-4 the open “3” is $29 compared to $36 for the closed “3.” In MS-60 the prices are $230 and $350, respectively, and in MS-65 the prices are $1,950 and $3,250, respectively.
The mintages of the first half of the 1870s suggest that the Shield nickel was seeing heavy use despite the presence of silver half dimes. With the end of the half dime arriving in 1873, the expectation might have been of still higher mintages, but that was not the case. In fact, in 1877 only proofs were struck. In 1878 just proofs were struck again. Mintages are pegged at 900 for the 1877 and 2,350 for the 1878, which results in Proof-65 prices of $4,850 and $2,100, respectively.
The collector seeking top quality examples would be well advised to check the proofs as the Shield nickel reflects the collecting pattern of the time, which saw many collectors acquire just a proof each year for their collection. This pattern was logical especially in lower denominations like the Shield nickel, because they were produced only at Philadelphia.
This situation is especially convenient today when it comes to finding high-grade, but lower priced examples from the late 1870s and early 1880s. From 1877 through 1881 no Shield nickel had a mintage of even 75,000.
As an example, look at the 1880. The mintage is 19,995. It is $1,800 in MS-65 but $700 in Proof-65.
The 1879 with a mintage of 29,100 is $1,900 in MS-65 and $750 in Proof-65. Certainly as value for money goes, many collectors opt for the proofs.
In 1882 Shield nickel production jumped to almost 11.5 million pieces. It was probably time to catch up after years of low mintages, but the following year the total would drop back to just under 1.5 million as the Shield nickel was only produced for part of 1883. It was replaced that year by the new Liberty Head design.
It is interesting as we find that the two final dates of the Shield nickel are surprisingly available. It appears that the collectors of the period realized it was about to be replaced and saved some in anticipation. We also see that the first 1883 No CENTS Liberty Head nickel is available. It is a good situation for type collectors or anyone wanting a nice Shield nickel as it is not unusual to see a few 1882 or 1883 Shield nickels offered in higher Mint State grades and at prices like $635 and $750 for the two dates. You have to feel like you are getting a very good deal.
In fact, with the 1883 Shield nickel and two types of 1883 Liberty Head nickels you can honestly put together an interesting 1883 nickel set in a grade like MS-60 for a very minimal investment. You can also add the one Shield nickel error that is widely recognized, the 1883/2, which is currently $18.50 in G-4, $2,000 in MS-60 and $3,750 in MS-65.
Whatever grade you select, the Shield nickel is an excellent collection and ranks as one of the few 19th century sets that most can complete.
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