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Rare Money Blog

Harvey Stack Remembers: Growing Up in a Numismatic Family, Part 37

By Harvey Stack, Co-Founder

Author: Harvey Stack / Thursday, February 07, 2019 / Categories: Harvey G. Stack Remembers

For Stack's, 1965 was a very demanding year. Beginning in this year, the U.S. Mint stopped making dimes and quarters out of silver and reduced the silver content of the half dollar to 40%. All the dimes, quarters and half dollars struck in 1964 or earlier were left in circulation by the Mint. Like all things that are predicted to become scarce, the public, collectors, and investors started to buy them up. Shortly after the announcement of change in the coins' make up by the Mint, hoarding began and such coins were removed from circulation. The public awaited a rise in price, so they could sell them at a profit. In the beginning, there were so many that the price over face value did not make hoarding them worthwhile. But as in all such situations, there were many who believed the coins would become profitable and that silver in the future would be a great investment. Newspapers and other publicity  made much of this "great investment," and the public responded by further hoarding.

In addition to the shop being full of people looking to profit from silver, my time was taken up with working with our attorneys in Washington, D.C. preparing our action against the Office of Gold and Silver Operation (OGSO) because of the restrictions on importing of gold coins (to be discussed later).

The year 1964 had been somewhat lean for Stack's with regard to major public auction sales. Collectors had started to worry that the Treasury might try to change the Gold Reserve Act of 1933-1934 that restricted the ownership of gold coins, unless you were a collector. There was concern that since silver was being taken out of our coins, maybe the Treasury would want to try to gather all gold coins. As it would have required an Act of Congress, it was unlikely. But these rumors, and other factors, including the restrictions on imports, made both buyers and sellers wary of what was in the future.

Fortunately, rulings came down that the OGSO was interested only in gold coins that might be sent by counterfeiters to the United States. The goal of the Secret Service (who had seized counterfeits which were in the United States in previous years) was getting false coins out of the marketplace.

I spent days and weeks in Washington trying to find out how the OGSO determined what was a counterfeit and therefore should be seized. In general, they were not interested in numismatic, collectible coins. They had a list so their agents could more quickly determine what was to be allowed and what was to be banned. Yet they did not make that list public, so the question remained, "What was the criteria they were using to issue import licenses?" People in the coin hobby had no idea what references were being used or if the Customs House had experts who knew the difference between real and false coins.

This continued to be a problem for the collection that Stack's was trying to bring to the United States from the Netherlands: about 900 different gold coins of the world, a major collection for sure. From the inventory list we submitted, the government wanted to consider licensing only 725 pieces and restrict about 175 pieces from entry. This despite the fact that they never actually saw any of the coins in the collection. Our attorneys, on our behalf, demanded to know what was the basis for denial of these coins. That was the main question of our lawsuit.

Since Stack's had built a good relationship over the years with the Netherlands collector, he agreed to wait and see the outcome of the case, and keep the collection for auction in the future, once we got the license. He did not wish to break up the collection and appreciated that we were willing to spend the time and legal costs to get his collection into the United States. So, we proceeded. But at this point mostly we were forced to wait and wait some more!

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