Saturday, May 19, 2007
Annals of numismatics: The wreck of the "Black Swan"
Every decade or so the discovery of a new "hoard" of old coins rocks the coin collecting world. It has happened again.
In 2003, a high tech salvage recovery firm that rejoices in the name of Odyssey Marine Exploration recovered the wreck of the SS Republic, which sank off the coast of George in October 1865. That wreck contained American gold and silver coins worth hundreds of thousands of dollars in face value -- and tens of millions of dollars in numismatic value. According to published reports, "the recovered U.S. coinage include[d] 47,000 U.S. silver half dollars, 2,620 gold $20 double eagles, and 1,496 gold $10 eagles."
Unlike many "coin hoard" discoveries, the SS Republic salvage did not crush the value of coins previously thought to be rare because the Republic hoard contained a wide variety of denominations, dates and mint marks. In this regard the Republic discovery stands in stark contrast to the impact of the SS Central America hoard of 1989:
The S.S. Central America carried as cargo most of the San Francisco’s mint production of $20 Liberties for the year 1857. Embarking from Panama, the S.S. Central America sailed around Cuba on its way to New York, but tragically sank off the coast of Virginia in foul weather. The wreck was discovered in 1989, and it has taken until now to untangle the legalities of ownership and dispersal rights.
Prior to the discovery of the wreck, only about 35 coins dated 1857-S were known to exist in uncirculated condition. According to the April 2000 PCGS population report, there are now more than 3,200! One astonishing fact about the S.S. Central America hoard is the complete lack of diversity in the group. Approximately 95% of the coins recovered are 1857-S $20 gold pieces; there is no depth or real secondary choices from this incredible find.
Odyssey Marine, which is publicly traded, did a great job marketing the coins from the SS Republic back in 2004. It persuaded one of the two nationally-recognized coin grading services to designate the new grade of "shipwreck effect," which transformed silver coins chewed up by salt water into a collectible and tradeable asset of considerable numismatic value (no such designation was necessary for the gold coins, because even 140 years under the sea will not damage gold).
Now Odyssey Marine has found another wreck in the Atlantic ocean, and it has hauled away more than 17 tons of colonial-era coins with a guesstimated value of more than $500 million.
A jet chartered by Tampa-based Odyssey Marine Exploration landed in the United States recently with hundreds of plastic containers brimming with coins raised from the ocean floor, Odyssey co-chairman Greg Stemm said. The more than 500,000 pieces are expected to fetch an average of $1,000 each from collectors and investors.
"For this colonial era, I think (the find) is unprecedented," said rare coin expert Nick Bruyer, who examined a batch of coins from the wreck. "I don't know of anything equal or comparable to it."
Citing security concerns, the company declined to release any details about the ship or the wreck site Friday. Stemm said a formal announcement will come later, but court records indicate the coins might come from a 400-year-old ship found off England.
Because the shipwreck was found in a lane where many colonial-era vessels went down, there is still some uncertainty about its nationality, size and age, Stemm said, although evidence points to a specific known shipwreck. The site is beyond the territorial waters or legal jurisdiction of any country, he said.
"Rather than a shout of glee, it's more being able to exhale for the first time in a long time," Stemm said of the haul, by far the biggest in Odyssey's 13-year history.
He wouldn't say if the loot was taken from the same wreck site near the English Channel that Odyssey recently petitioned a federal court for permission to salvage.
In seeking exclusive rights to that site, an Odyssey attorney told a federal judge last fall that the company likely had found the remains of a 17th-century merchant vessel that sank with valuable cargo aboard, about 40 miles off the southwestern tip of England. A judge signed an order granting those rights last month.
In keeping with the secretive nature of the project dubbed "Black Swan," Odyssey also isn't talking yet about the types, denominations and country of origin of the coins.
Bruyer said he observed a wide range of varieties and dates of likely uncirculated currency in much better condition than artifacts yielded by most shipwrecks of a similar age.
Is there anything more fun than buried treasure?
The really interesting aspect of these discoveries is what it does to the collector value of particular denominations and mint/year coin populations. When the S.A. was found, it reset the market for previously rate 57-S coins. As I understand it, the 61-O is going to get turned on its head. Google the 61-O for more, but its historical context is that 2/3 of those minted were done "privately" at the inception of the Civil War, and the finest known to date are in the range of AU. Bet you a buck there's an MS67 in this hoard.
JT in NC
By TigerHawk, at Sat May 19, 09:06:00 AM:
JT, you collect coins?
That is so cool. It doesn't get you many girls, but it makes you a much smarter person.
I'd love to know the proportion of coin collectors who are political conservatives. I bet it is extremely high. Republican presidential candidates could do worse than to show up at big coin shows.
By D.E. Cloutier, at Sat May 19, 10:35:00 AM:
"Is there anything more fun than buried treasure?"
Yes. Unburied treasure.
By D.E. Cloutier, at Sat May 19, 10:44:00 AM:
P.S. With unburied treasure you get many girls.
Treaure is cool, but knowing more about the wreck and a commitment to the less lucrative but more historically valuable work of underwater archeology as part of the recovery effort would impress me even more. Doesn't sound like that is part of Odyssey's profile, but with a gross of 1/2 a billion, you think they might be able to do a bit for posterity with this site as well as for prosperity. Perhaps they will surprise me, but as they seem under no obligation to do so, I bet the wreck itself has been rendered historically valueless by the salvage work.
Oh, and Black Swan was a pirate ship in a Raphael Sababtini novel. Good code name for treasure hunters.
By Dawnfire82, at Sat May 19, 12:38:00 PM:
And how many more undiscovred shipwrecka are still down there in davy jones locker that remain to be found?