Several issues ago we asked the following question and solicited responses from our readers: Can today’s collector of Mexican Coins, any series, determine the True Rarity of any single coin?
Now let me give you my spin on Mexican coin rarity and what it means to today’s collector.
What makes this old car worth this amount of money? First, it is Truly Rare, in fact I guess you would have to call it unique. But so what, I have an old junk-heap that I can’t give away. The what is; there were at least two people that believed this old car was worth at least a half million bucks. Therefore, at the end of a bidding war one-person won, after forking over $690,000.
I’m sure you are asking: What does this have to do with Mexican coins? It means that sometimes, perceived rarity, along with a good publicity campaign can drive up prices collectors are willing to pay for collectable items to astronomical heights. I can guarantee you one thing, the guy that bought the Pope’s clunker wasn’t a collector of Mexican coins.
Now for some bad news, in today's changing coin market it is almost impossible for the average or new collector of Mexican coins to determine the True Rarity of any Mexican coin or series! Furthermore, I hope to prove to you it has been almost impossible to do so in the past, but hopefully this formidable task will become somewhat easier after reading this article.
Let me make an important statement here-- “When collecting any old coins, especially Mexican coins, the True Rarity of a coin is the most important thing to keep in mind.”
Notice that even Webster’s relates rarity to being valuable. When dealing with coins, True Rarity is sometimes misunderstood. If a coin is one of only 100 coins existing, it could sometimes be called rare, but when dealing with Mexican coins this coin might be considered common on my rarity scale.
If there are hundreds, or even thousands of collectors of our sighted coin having only 100 specimens, most people would consider this coin rare. If this coin is rare, how would you classify a coin where there are only 10 examples known, but only five collectors? Can you really consider the second coin to be as rare as the first coin?
Therefore, when dealing with coins, and trying to establish their rarity most people also look at the condition of the current market.
Now to the big question: How does the average coin collector determine how many surviving coins there are, so that he or she can begin to determine what the True Rarity is of any single Mexican coin?
Before now this task was almost impossible without help from outside sources. There are many sources of information dealing with True Rarity and the sales of most collectables, including all coins for the U.S. coin collectors and many other foreign coins. This has simply not been the case with Mexican coins in general, and the gold coins in particular. Trying to determine the actual number of existing individual coins by any DAM (Date/Assayer/Mintmark) today is very difficult for a number of reasons.
Oh, bye the way the person, or persons who paid that $7 million plus dollars for that U.S. 1933 $20 gold piece seemed to think it might be the only one that remained out of about a half million minted in 1933. I’m sure the owner was in shock when he or she read the story in Coin World during the summer of 2005 that 10 more examples had recently been verified! The perceived rarity of this coin was totally washed down the drain with this revelation, as there now appears to be at least 13 specimens verified of the world’s only $7 Million Dollar Coin.
One problem that frequently occurs, giving coin trackers hell, is that a single Mexican coin can and will be sold several times between its first appearance on the market and its final delivery into a collection, where it may disappear for many years. It is a difficult task to keep from listing this coin as multiple coins.
Because the “Mexican Coin Collector Base” is so small, few if any, have found a commercial venture worthy of tracking sales of Mexican coins. Selling reference books and sales information to Mexican coin collectors is difficult because they are hard to find and most tend to be “skinflints” when it comes to purchasing reference books, or significant research data. In fact, the FoxLair Project appears to be the only commercial “population study” currently being attempted.
Another problem for us “coin trackers” is the many “Private Treaty Sales” that take place each year. These private treaty sales consist of sales from collector to collector, or dealers to collectors, and are nearly impossible to track. Furthermore they will be impossible to track in the future until the collectors of Mexican coins feel the need to do something about it, which seems unlikely in the near future.
However, there are collectors, both new and old, that have developed, or are trying to develop methods used in other areas of numismatics to arrive at some semblance of the rarity of Mexican coins. There are several components or data elements that most of these people use when establishing rarity for any coin. They are:
In the past it has been solely up to the individual collector, dealer or auction cataloger to determine which Mexican coins were rare and which were not using these methods. This was especially true with “Mexican Gold Coins” because the first “real” reference book for any of the gold series was published in 1986 in Barcelona Spain about the 8 Escudos of Latin America. The only other “real” reference book for Mexican gold has been Richard Long’s book on the early Republican Gold that was released in early 2005.
There have been many earth-shaking events in the world of Mexican Gold Coins since 1984 when the Calico brothers finished their research on The Onza Main Book. These events started in May 1985 with the first sale of the unbelievable Norweb Collection in Dallas, Texas and continued with a second in November, but this wasn’t all of the Norweb collection; there were further sales in London containing much of the Norweb silver, including the majority of their 8 Reales and silver 1 Pesos. The 1990’s saw several more events that changed the world of Mexican coins forever. The first was the Sotheby’s Latin Gold Hoard that was dispersed in a series of sales of 10 or more sales in Geneva Switzerland, London England and New York City. This fabled Gold Hoard was followed by two sales of the fabulous Pablo Gerber Collection in 1995 and 1996. These events, if no others had occurred, would have changed the face of collecting Mexican coins, but there have also been many other smaller sales that have contributed many excellent coins to the World of Mexican Numismatics.
But from these events alone we can begin to see that much has changed during the years since the Calico brothers produced their wonderful book The Onza Main Book, because the number of Mexican 8 Escudos available for collectors has increased at least two-fold, and maybe even more since their book was printed. Because of these events one might assume the actual rarity of these coins should be down to tolerable levels. But as you will see in this article ... I don’t agree!
My reasoning for this is a two-day sale that occurred during April 2005. This sale contained the Louis E. Eliasberg Foreign Gold Collection and was offered by American Numismatic Rarities (ANR). Many new records were set for Mexican gold coins including a nice Mo 1823 JM Hookneck 8 Escudos, which sold for $55,200 eclipsing the old record of $36,000.
Many Mexican coin collectors and dealers couldn’t believe someone paid this unheard of price for a relatively common coin, but it proved to be just the proverbial tip of the iceberg.
Most people use a mint’s recorded production figure as their first consideration for determining a coin’s rarity: How many coins were originally produced during the mint run of these coins? Sometimes finding this “empirical” figure becomes an almost impossible task, while at other times it is very easy to ascertain from well-run mints all over the world. Until recently it was almost impossible for the average collector to know how many coins of any series were struck at any of the Mexican mints, and for many it still is.
There have been very few reliable figures of the number of actual coins struck in any of the Mexican mints because of a record keeping system that was inherited by the Mexicans from the Spanish Crown, oh so many years ago. The Spanish King was not interested in the number of coins that were minted. No, what really interested him was the total Peso count; thus the value of all coins minted in Pesos because he was due his Royal Fifth of all metals produced in not only Mexico, but in the entire Spanish Domain. Because of this, the Spaniards in-charge of record keeping at the Royal Mints throughout the world recorded all metal production in Pesos!
There has been much confusion by the term Peso and what it means today versus what it meant long ago in Mexico. Today, in Mexico, the Peso is a monetary denomination, but in the past the Peso was a particular weight of any precious metal. This created considerable problems for many early researchers and collectors when trying to unravel the mintage figures that have appeared sporadically in other books and research papers. As a case in point, most, if not all, of the individual 8 Escudo production figures shown in the Robert Harris book, Gold Coins of the Americas are overstated by 100% because of his misunderstanding of a Peso of gold.
In case you didn’t know, it took 16 Pesos of gold to make one 8 Escudo, but only one Peso of silver to make an 8 Reales. Interesting isn’t it? But it relates back to the “classic” silver value to gold ratio that for hundreds of years was a 16 to 1 ratio.
Now back to determining the rarity of Mexican coins, in the past there have been very few places where the average collector could find any gold or silver production figures, let alone the actual mintage figures of individual Mexican coins until the introduction of decimal coins. Dr. Alberto Pradeau included some mintage or/and or production figures in some of his fine works. However, the most interesting figures come from a book seldom ever seen by the average collector Mexican coin collector that was first published in Mexico during 1857! It wasn’t until 1993 that this book came to light in the Mexican numismatic circles, as the Bank of Mexico reproduced it for the Mexican Numismatic community. This book is Moneda en Mexico and was written by Manuel Orozco y Berra for the Federal Government of Mexico and was a complete “resume” of all precious metals production from the very beginning of the Mexico City Mint until 1853, and included all of the Republican mints known to Orozco. It is a treasure house of information for the early years of Mexico, but most important to us, as collectors, is the complete listing of all gold, silver, and copper production in Pesos by mint by year. Orozco y Berra later produced another book that has a cut-off date of 1879 for precious metal production. This means we now have some “Official Documentation” of precious metal production that was written while the actual production was still going on in the mints! But alas the Mexican Numismatic community, as of today, has still not recognized the historical significance of these volumes. So we will attempt to list all of these production figures for you on this website in the coming years.
There was another very important find, at least for my work, when I got a phone call from an angel in Mexico named Clyde. This angel was that most famous of all living Mexican Numismatists, Mr. Clyde Hubbard who wanted to help with my research and books. He had many interesting items that answered many questions for me. But one of the most important items was a copy of parts of another important book he had in his extensive library1. Here was another “Official Resume” of gold, silver and copper production at each mint during the Republican Period.
Now all I had to do was build a chart with all of the newly found information in one place to see how much specie was produced in each mint each year. Yes, there are some problems with this data as mentioned in an earlier article, but it is still better than what we had before. So now we have at least established some basic mint production figures, but this still does not tell us exactly how many coins were produced by mint and denomination during each year.
It was now time to go to my expert sources to try to determine if there are any minor gold coins known from the Mexican mints by year. If there are none, then I make the assumption that all of the gold production was used for 8 Escudo production. I make this assumption for several reasons; gold was not normally used in the day-to-day business transactions by the general Mexican population during the Colonial and Republican Periods, because any and all gold coins including the ½ Escudo were worth more money than most citizens of Mexico saw in several months. Therefore, most gold production, in most mints was used for 8 Escudo production. I believe it was also done for another important reason: Most of the Republican mints were controlled by foreign investors wanting to extract their profits and remove them from Mexico because of the unstable political environment of the country during the Republican Period.
How do I estimate how many 8 Escudos were produced in the individual mints by year?
By taking the selected gold production figure in Pesos for that year and dividing it by 16; thus I have a total maximum number of 8 Escudos that could have been produced from that mint for that year. Simple, but not foolproof. However, if there are verified minor gold coins I take these into account by stating all production for this year was not used for 8 Escudo production.
Let’s now examine why I believe we see fewer sales of Mo 1825 JM than the Go 1862 YE. The first reason has to be that one coin was made 37 years before the other, thus allowing for more time to have been lost or melted down in commerce around the world. Another factor is probably that many of the earlier coins were shipped from Mexico by people wanting to get their profits “outta Dodge” before Mexico collapsed into another of her frequent wars and revolts. My theory is that the mint lessees transshipped many, if not most, high-value coins from Mexico to the U.S., European, and Far East countries. Many, if not most, of them were probably melted upon arriving in these foreign lands to make new coins for those countries where they ended up.
Let’s now take a look at that expensive 1732 Mexico City 8 Escudo to see why it was worth so much money. Is the coin rare? Well the Calico brothers thought so because they gave it a value of $27,600 in 1986, which is by far the highest value they assigned to any Mexican Portrait 8 Escudo. This DAM is a “classic rarity” and is highly sought after by many “Type Collectors” for several reasons:
It is the first gold issue from the Mexico City Mint that was made with a screw press
It is the first Mexico City Portrait gold coin
And because this specimen was the error version with no assayer, or denomination, it is even more desirable, especially in high-grade.
Furthermore its pedigree is top-notch; it dates back to the Col. Flanagan and the Eliasberg Collections, and this specimen hadn’t been on the public market for 61 years
Therefore one must assume that at least two collectors thought it was worth at least $75,000.
I think it is safe to assume that most old Mexican gold has disappeared into the melting pots of other nations. While many 8 Reales were also melted, many remained in commerce, especially in the Orient and even in the United States. However, many Mexican minors were used as small change all over the world, thus explaining why some non-hoard dates are so difficult to find in high-grade today.
When the second hoard sale took place, in Geneva, it was done under circumstances that provided many interesting questions and mysteries for the Mexican Numismatist, as Geneva is not known as a ‘hot-bed’ for Republican coin sales. Of course this isn’t the case with the Colonial Period of Spain because Geneva has seen more than its fair share of great Colonial Gold collections crossing the auction block there. Why did Sotheby’s select Geneva, and why did they not publicize this sale in Mexico or the United States, where the majority of the Mexico gold collectors live?
Later, during the large bulk sales of the majority of the hoard, why did Sotheby’s select London for so many of these sales? Another big question is why didn’t Sotheby’s have at least one sale in Mexico? Another puzzle is where did these coins originally come from? There were very few Americans or Mexicans at the sales and no collectors that I’m currently aware of … Why? Why was there so much secrecy about these sales? Why are there still so many questions without any answers today? But that’s another series of articles.
Oh, by the way the main difference in the price of those two 1790 Mexico City 8 Escudos is that one is a higher grade specimen, but another big difference is that the cheaper coin appeared in a three-coin lot at the Sotheby’s Geneva Sale, with no photographs. The more expensive coin was sold in the Eliasberg sale and many attending the sale believed it to be improperly graded.
New hoards of 8 Reales are still being found in Mexico, China and the U.S. and I would like to believe there are still more hoards of Mexican 8 Escudos in bank vaults all over Latin America and the world that have been held as reserves for banks and central governments. But I believe the Sotheby’s Hoard was unique because of the coins that appeared in it, and for reasons that I will document in future articles on this website to complete the series started in Issue 3. Now you can begin to see why collecting Mexican coins is so much fun for the amateur historians like me!
Because of this “Type Coins”, in ultra high-grades, even if not Truly Rare tend to bring much higher prices than Mexican coins of higher rarity and grade that don't fit into one or more Type Coin sets. One only has to look at the aforementioned Mexico City Mo 1823 JM Hookneck 8 Escudos to see this trend.
However, there are also many coins that fit into what I call “classic rarities” that also bring above average prices when one compares their rarity and grade to other Mexican coins. I consider a Mexican coin to be a “classic rarity” when several conditions occur. The first one is when modern catalogs show values much higher than those of similar coins in a series. Sometimes coins shown with higher values are not Truly Rare because by some fluke modern catalogers have picked up an “abnormal” price and continued to use it for many years without looking at current auction prices. Other times a coin will be a difficult to find “Type Coin” and thus it becomes another “classic rarity”.
Many individual Mexican coins are normally unheard of in high-grade, so when a nice Extra Fine or better shows up, most advanced collectors of that series know it, and are willing to “pay the piper” the money required. We then see a bidding war begin, even when all of the catalogs show the coin to be worth much, much less.
This brings up another problem we have when trying to put a single rarity classification on some Mexican coins. There are Mexican coins that are very common in low grades, but are unknown to exist in grades above Very Fine. While not a normal “classic rarity” they are extremely rare in grades of Extra Fine or better, but very few collectors know this. This causes these coins to become what I call “hidden rarities”. A “hidden rarity” may be well known to the few advanced collectors of a particular series, but the general collecting public, including many “Type Collectors” may be completely in the dark about them.
When all of these conditions; the overall number of collectors, “Type Collectors”, “classic rarities” and “hidden rarities” come to a head in a single auction the fireworks begin. This occurred in the Eliasberg sale and to a lesser degree in a couple of recent Ponterio & Associates sales, resulting in record setting prices for some Truly Rare coins. The two above mentioned Chihuahua minor reales were in one of these Ponterio sales and both brought record prices for Chihuahua minors. In fact, these may be record prices for both denominations sold at public auction or through private treaty?
Today’s market for nice, ultra high-grade (almost Uncirculated or better) Mexican gold coins that are not “Type Coins” seems to range in price from $1,500 to very expensive. But when you compare these prices for Mexican gold to the prices for gold coins of the same age, rarity, and grade from many other foreign or American series, these coins are still found at bargain prices, or so it seems to me!
These bargain prices are in direct proportion to the number of collectors for a particular Mexican coin series that are currently in the market for these coins. I have to agree with Richard Long who has been saying, “Mexican coins, in almost all series, are still undervalued. A smart collector shouldn’t put off beginning a collection, because it shouldn’t be too long before the market changes, and then it will be too late”.
Now let me tell you about the above-mentioned Hermosillo 10 Pesos. Most Mexican mints 10 pesos, like the 4 Escudos, are at least rare on my rarity scale. But several mints’ 10 Pesos are seldom, if ever offered publicly, and Hermosillo is one of those. In fact I have recorded only six total sales for all Hermosillo 10 Pesos. Furthermore, the last offering I have recorded for a Ho 1881 A 10 Peso before the Eliasberg sale occurred in 1954 at the King Farouk Palace Sale in Cairo, Egypt. Attending this sale was an astute Dallas, Texas collector, who bought six 10 Pesos in one multi-coin lot for only $58. The pent-up desire for a Hermosillo 10 Peso fueled a bidding war between several collectors and dealers, and the winner was willing to pay $34,500, which is a record price for any publicly sold 10 Peso that I have found.
One last thought; beware of any Mexican coin touted as being Unique.
I personally believe it is impossible to conceive that a Mexican Mint; Colonial, War of Independence, Republican or Revolutionary War, ever made only one coin from any set of dies produced. No, those “unique” Mexican coins are like the U.S. 1933 $20 Gold Piece and the Mexican C&J 8 Reales, there are others lurking out in the weeds just waiting to be found. And as soon as the prices reach a “threshold” that the current owners believe is “a-fair-price”, we will surely see more, and possibly even a few new “unlisted” DAMs unseen before now.
Enough for now; I don’t want to bore you any more. Hopefully our readers can now begin to see how and why I think the Golden Age of Mexican Coins is just around the corner. I believe the higher prices we are now seeing will bring many more Truly Rare and beautiful high-grade coins to the market in the near future, sometimes from places where they have been hiding for over 50 years.
Happy coin hunting until next time, when we are going to investigate an even more controversial issue than Determining True Rarity. This topic: Is there Price Stabilization, or even worse Price Fixing going on in Today's Public Auctions of Mexican Coins?