Whether you're new to historical U.S. gold and silver coins or a seasoned collector, you may have heard that pre-1933 gold has special significance. What makes this gold special is a combination of rarity and history.
Why is Pre-1933 US Gold so special and collected? On April 5th 1933 U.S. President Franklin D. Roosevelt signed Executive Order 6102 "forbidding the hoarding of gold coin, gold bullion, and gold certificates within the continental United States." Owning and possessing monetary gold became a crime as the order required monetary gold to be returned to a Federal Reserve Bank branch for fiat paper money. The order was issued a month after Presidential Proclamation 2039 that forbid the hoarding of gold or silver coin or bullion under penalty of fine and/or imprisonment up to ten years! Thereafter, the Gold Reserve Act of 1939 codified Roosevelt's order and it imposed new civil penalties; many individuals were in fact prosecuted for possession of gold under these laws. As a result, vast quantities of gold coins were turned in, taken out of circulation, and melted. Today, collectors prize pre-1933 US Gold Coins for not only each coins beautiful design and rarity but also for its symbolism for those that retained the gold coins and rejected governmental imposed fiat money.
History of Pre-1933 Gold
In 1933, President Franklin D. Roosevelt signed an executive order limiting the private ownership of gold. The rationale given to the public was that the Great Depression was causing people to "hoard" gold, which was making the economic situation worse.
In reality, because paper currency needed to be backed by the Federal Reserve during this time according to the gold standard, private ownership of gold coins and bullion was preventing the Federal Reserve from increasing the amount of money circulating.
By this executive order, people had to return the majority of their gold coins, certificates, and bullion to the U.S. Treasury. (A gold certificate was something that people held in lieu of storing the actual coin.) The U.S. Mint also stopped producing gold coins and melted down 1933 minted coins.
Owning more than $100 in gold coins became a federal crime, punishable with a $10,000 fine or up to 10 years in prison. Roosevelt's executive order remained in effect until it was repealed in 1974.
With so much pre-1933 gold being melted down, the surviving coins became more valuable than their face denomination or even their gold content. (Value over melt worth is known as a "premium.") They are now collectible and rare. You really purchase a piece of history when you obtain one of these coins.
Today, we are accustomed to dollars and cents. From 1792 until 1933, however, the U.S. Mint also produced eagles, or $10 gold coins. From this base unit, you could also a get quarter eagle ($2.50), half eagle ($5), and double eagle ($20). Eagles were minted in three different designs over the nearly 150 years they were issued: the Turban Head until 1804, the Liberty Head, and the Indian Head.
In addition to eagles, pre-1933 gold coin denominations include the three-dollar gold coin (minted from 1854 to 1889) and the one-dollar gold coin. There is also an extremely rare four-dollar gold coin that was only minted in 1879 and 1880.
Because Saint-Gaudens Double Eagles (minted 1907 to 1933) were used by the U.S. government after 1933 -- for transactions with Europe -- they are more common. This makes them a particularly well-priced investment for the first-time collector.
There are many ways to start collecting pre-1933 gold. You may want to collect one of every design or build out a multi-date collection of just one design. Another option is to choose a single mint. For example, the U.S. Mint in Carson City, Nevada produced relatively small numbers of gold coins, and so some enthusiasts highly value owning these coins.
Many people choose a date -- such as the year a prominent ancestor was born -- and try to find coins from that year. However you decide to do it, your collection has little to no downside and the potential for great monetary appreciation.
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