Capped bust design... In my view ranks among the most majestic of all images emblazoned on US coinage. So, riddle me this.... Flowing hair dollar design... 1794-1803 No further dollars minted until 1836 when the Seated Liberty design was introduced. Capped Bust halves were minted through 1839. The entire series of Capped Bust half dimes, dimes & quarters ran through 1838. Why then would we not kick-off minting dollars in 1836 with the same design that was prominent on all other denominations? Jeez, that design would have made for a spectacular dollar.... Where's my time machine? I need to go have a talk with somebody..
Could it have had something to do with the prevalence of the Mexican dollar (peso?) in American commerce? Edit: found the answer here: The early dollars from the United States Mint were not instantly embraced by the public, which had become accustomed to the dollar's predecessor, the Spanish-American Piece of Eight. That coin contained slightly more silver than its new competitor. Then some entrepreneurs made an interesting discovery. They could buy American dollars, send them to the West Indies, and exchange them there at par for Spanish-American Pieces of Eight. Then they could bring the pesos home, turn them in to the Mint for melting, and make a profit by getting paid back in shiny new dollars. When the scheme was uncovered, it resulted in a thirty-year halt in dollar production, beginning in 1805.
During that time period there was no real use for a dollar sized coin for commerce. Silver was also a tough commodity, so foreign coins were being bought up by the Mint, melted, and re-coined. Dollar sized coins were never popular in America anyway, so when dollars were finally re-introduced, they were mostly used for foreign trade, and in later years, with the discovery of the Comstock load, only circulated in the western states.
In regards to post #2, how much of a difference could there be in order for this scheme to be profitable? How many dollars would they have to buy, switch and redeem as well as going back and forth from the West Indies? What is the weight difference between the coins, the price of silver at that time, etc. Let's say you invest $1000. You could probably get that many silver dollars, (assume you are in NYC or other area with a lot of banks) go to a few banks and convert the cash into silver dollars. Now, you have to ship them? or take them with you to the West Indies. How easy is it, to scramble around and switch these for Spanish 8 reales? Then you have to ship/ transport them back to the US, turn them into the mint, and get paid for the silver weight. How much more than $1000 are you receiving? Is it worth all the time and trouble?
I guess I was not clear enough. Sorry! IMO, if blown up to dollar size the coin would look comical!! Now, if the artwork was extremely detailed as seen on many European Thalers, I might change my opinion.
Thomas Jefferson, by presidential order, ended the striking of silver dollars in 1806. This discontinuance lasted until 1836, by which time efforts were already being undertaken within the mint "to redesign the U. S. coinage to" make it more attractive" using the work of Christian Gobrecht based on designs by Thomas Sully. These efforts had been underway since late 1835. In 1836 authorization to create dollar coins was once again received and it was decided to start the new coin design with those. The experiments resulted in the Gobrecht dollars of 1836, 38, and 39. The 1836 is struck to the 416 grain standard current at the time, the 1838 and 39 are struck to the 412 1/2 grain standard adopted in 1837. When the seated liberty dollar as we normally think of it was adopted in 1840 the flying Eagle reverse was discarded in favor of the standing Eagle we are familiar with. Dollar coins were used in America before the 1840s, the Spanish milled Dollar was in common use during that entire period. The mint did NOT buy up foreign silver and recoin it. They had no authorization to buy silver in the open market until the bullion fund was created in the coinage act of 1837. Before that time they were dependent upon people and businesses to deposit silver at the mint for coinage. If no deposits were brought in, the mint stood idle except for production of copper coinage, which was struck on government account.
This concept and the practice of people depositing silver, and gold, at mints so it could be minted into coins that Conder pointed out is something a lot of folks aren't aware of. And it wasn't just the US that did this, mints worldwide did it. It was never allowed in the US, but for centuries in Europe the way that mints even came to be was that an individual, usually a Noble, would pay the Crown a sum of money, often a large sum, for the right to mint coins. Then that Noble had to come up with all his own money to fund the mint, he had to pay for everything on his own. And his only source of precious metals were what he could either buy on his own or what individual people and or local merchants brought to his mint and deposited with him so he could mint it into coins for them. The mint owner then had to melt the metal, no matter what form it came in, refine it to the required fineness, form it into large sheets, cut out planchets, and then strike the coins. And all of it was done by hand. That's just the simplest basics, there's a whole lot more to the story. But is the where and why of how seigniorage came to be.
Sadly, the Smithsonian is dead wrong on this. They would export the dollars, and trade them for 8 reales weight for weight, which means they would get like 110 8 reales in exchange for 100 US silver dollars. They would bring them to the US where they could trade the 110 8 reales for 110 US silver dollars in commerce. Rinse and repeat, and that is how the US lost a lot of money. That is how the profit was made. Sad how even the Smithsonian cannot be relied on for accurate information anymore.
