As a full time coin dealer who buys coins from the public every day, I often hear something like, "What do you mean? That's a 100 year old coin!". This is the response coin dealers sometimes get when we offer less than $10 for most common date circulated US silver dollars.

There are many good reasons why old coins, especially silver dollars are not worth big money. First of all, most of the coins have high mintages. For example, from 1880-90, 100 million silver dollars were minted just at the New Orleans branch mint. From 1878-1900 there were four separate US mints, each turning out many, many millions of (now 100 year old) silver dollars most years. Many more coins were minted way back then, than were ever put into circulation. National politics played a big part of the government policy of producing more coins than were needed.

Until about 1963, silver dollars routinely circulated as legal tender. This was a relatively unpopular coin. Except for a few western states few seemed to want them. A $20 bill was much more convenient than a pocket or purse full of heavy silver dollars. When I collected in the 1950's and 1960's I would go to banks and ask for silver dollars, and usually got all that I wanted. The banks were glad to get rid of them. I'd scan the coins for better dates, and spend the ones I didn't want.

The US Mint kept careful records of all silver dollars that were minted. The Pittman Act of 1918 required that millions of ounces of silver be sent to India. To comply, millions of silver dollars were melted. Records were not kept of which coins were melted, and as a result many coins with published high mintage's were very hard to find. For example the 1904 "O" mint dollar, made at New Orleans showed a large mintage of over 3.7 million coins minted, however these coins were scarce. Circulated coins sold for more than ten dollars, and uncirculated ones were rare, worth $100 or more. It was generally assumed that most 1904 "O" silver dollars had been melted in 1918.

The last year silver dollars were minted was 1935. Eventually the huge, excessive stockpile of minted silver dollars were all stored at a Federal depository in Washington DC. The only real demand for these stored coins was for the Las Vegas slot machines. In 1963 a Las Vegas casino trailer truck routinely pulled up to the Federal depository in DC and filled up with a big load of dollars. It was soon discovered many of the bags contained uncirculated 1904 "O" coins, theoretically worth more than a hundred dollars each. The word soon spread and it caused a huge run on dollars at the Federal depository. Anyone with a $1000 cash could go there and purchase a mint sealed cloth bag of silver dollars. The front pages of many newspapers typically showed people carrying off many bags of dollars in little red wagons. On a personal note, I was a GI stationed in the DC area at the time, and I was just drooling at the idea of taking my chances at buying a bag of potentially rare dollars. Unfortunately though, they would not break up any bags or count out any coins. Only bags of exactly $1000 were sold. I had $500 in my bank account but for the life of me, couldn't find anyone else who had any money or wanted to be partners with me.

The run on silver dollars continued for many months. The government agency was not concerned about "losing" all these dollars because at the time they were actually worth only one dollar. In fact, they were happy to get rid of them. The dollars had been stored in two huge rooms. This run on the dollars emptied out the first, bigger room and then they opened the back room. Someone noticed that this room contained dollars from the Carson City mint, a small mint in Nevada located near the silver mines. It was soon realized that these were, indeed, rare coins and the sale of dollars was ended. Later the government had a GSA sale of these back room Carson City coins, but that's another story.

Until the early 1960's our government had a policy to buy or sell silver bullion that would peg the price of silver at $1.29 an ounce. When the world price rose above $1.29 there were only buyers, therefore the government was forced to let the silver price seek its own level. In about a year silver rose to over $2 an ounce, which meant that the silver content in silver coins became worth more than the face value. People started hoarding all their silver coins when coin dealers began buying common silver coins for a small percentage over the face value. This ended forever the general circulation of those 100 year old silver dollars and eventually all common silver coins.

I hope this explains why dollars so old are worth a relatively small price. At this writing the price of silver is about $5 an ounce, thus a silver dollar contains about $3.90 worth of silver. Belleair Coins is currently (Mar 2000) buying common Peace dollars (1922-35) and 1921 Morgan dollars at $5-6 for nice circulated coins, and much more for uncirculated. We are buying older circulated Morgan dollars (1878-1904) for $6-7, and of course much more for rare dates and uncirculated coins. The market for circulated, uncirculated, and rare date dollars changes all the time. We have many collectors and investors for these coins, and we are always paying fair prices for all silver dollars.

Sept 2006:  metals have risen dramatically.  As of Sept 2006, silver is $11 an ounce and  the dollars now contain about $8.50 in silver content.  Dealers are currently buying the most average common silver dollars at about $9-10.  If a person is buying silver dollars, not for collecting pleasure but strictly as an investment, we do not recommend average circulated coins.  The rise in silver absorbs the numismatic premium on common coins, does not push it up. 

The opposite has always been true in a metals bull market for choice uncirculated, high grade silver dollars, type coins, and scarce dates. The rise in metals pushes the prices of these much, much higher than the increase in metals.