Andy Lustig talks about collecting U.S. coins, especially pattern coins, pre-production prototypes struck to test new design concepts. He discusses how these coins have entered the market and which are the most collectible. Based in New York, Andy can be contacted via his website, USPatterns.com, which is a member of our Hall of Fame.
I started collecting coins when I was five years old, and I started dealing when I was 13 or 14. Most kids start with coins of circulation—I had albums for Jefferson nickels, Lincoln pennies and Roosevelt dimes. I started with Morgan and Peace dollars pretty early. I came close to finishing a set of Peace dollars, I was one coin away. That’s the closest I ever got to completing a collection of anything in my life. But I quickly moved into all kinds of other coins from around the world. I bought my first pattern when I was 13.
Now I buy, sell and collect coins from the U.S. and all over the world. Most collectors specialize in coins from their own country. They might casually collect a few odds and ends from other places, but they focus on their coins. There are exceptions, but I’d say only five to 10 percent of the collectors out there pay serious attention to things other than their own countries’ coins.
I actually began collecting by necessity. I kept seeing things that I wanted to buy, but the only way I could get more money to buy them was to sell other things, so I just constantly bought and sold. It didn’t take long to figure out that it wasn’t going to be sustainable, and I wasn’t going to be able to keep on doing that unless I started to sell the coins profitably. Within about a year of dabbling in coins, I was setting up at coin shows as a full dealer. I think I had my first table at 14, maybe 15 at the latest. It was in the basement of a shopping mall, but it was a pretty good little local show.
Collectors Weekly: Could you tell us a bit about USPatterns.com?
Lustig: Three other collectors and I decided we needed to set up some sort of website to expose the world to patterns, and we decided to do it as an online club, although it didn’t really develop into as much of a club as we had hoped. We set up a page where members could list themselves and their e-mail addresses and post their want lists. There are portions of the site that we set up so that collectors could get in touch with each other and dealers could get in touch with the collectors who were serious about patterns. That developed in a small way, but what really blossomed was the site itself as an information resource. The person that gets most of the credit for that is Saul Teichman, who is probably the number-one researcher of U.S. patterns. He’s also a collector. He’s probably written 95 percent of what’s on the website. He’s also very actively involved in editing the Judd book, which is essentially a guidebook to United States pattern coins.
Collectors Weekly: What attracted you to patterns?
Lustig: When I was 13 years old, I read an article, I believe it was in COINage Magazine. It told the story of patterns and illustrated coins that I couldn’t have imagined would exist, let alone be available to collectors. But here was this article, telling me all about these coins that were extremely rare but not even that expensive. Back then, in 1973, I learned that you could buy extremely rare pattern coins for $200 to $300, which was unfathomable to me. I thought, “I have to go out and get one.” So I did, and then I bought another and another and another.
I liked the history of the piece and the idea that coins don’t just bring you back to the Mint—they bring you back to the meeting rooms at the Mint where they discussed what they were going to strike next. The designers came up with all kinds of possibilities.
The Mint always had engravers on staff who would come up with new designs. Sometimes the designs were at their own initiative, sometimes they were the result of a specific request. Some of the designs were experimental in nature, others raised artistic issues or had to do with format.
For example, in 1849, the United States Mint started striking one-dollar gold pieces for circulation. They had a very small diameter because there wasn’t much gold in them. People complained about the coins being difficult to handle and easy to lose, so the Mint had a couple different options. One of them was to increase the coin’s diameter by putting a hole in the middle, so it still contained a dollar’s worth of gold, but it would be easier to handle.
The option they ended up adopting was to make a much thinner coin with a larger diameter, which also had just a dollar’s worth of gold in it. Pattern collectors prefer the gold dollar from 1852 with a hole in the middle.
Collectors Weekly: So they would make actual patterns of coins and then choose the one they wanted to use?
Lustig: Sometimes it was a matter of putting them next to each other and picking one out. Other times it was a matter of coming up with a design and then continually tweaking it until they got it right. A lot of times they would come up with a design and then decide to do nothing like it, so the only way to collect a piece like that is to buy the pattern. In the world of patterns, if there are 30 to 50 known pieces, it’s a common pattern.
Collectors Weekly: What kind of situation would warrant 50 patterns to be made?
Lustig: They might bring a number of patterns to Congress and say, “Do you like this one or do you like that one?” For example, in 1873, the United States started production on what they called the trade dollar, which was a silver coin. It was struck to a more international weight standard than the silver dollar, and the coin was meant for circulation or for export primarily to Asia.
The Mint produced a number of designs that were seriously considered. In the end, there were six silver trade dollars, each of which they probably made 60 to 100 pieces. Some of these went into sets, which were either shown off to key people in Congress or given for presentation purposes to key people. They’d say, “These are the six designs we’re considering. What do you think?”
Then, of course, just one design goes into circulation, but the pattern coins still exists. Coins of that rarity are surprisingly affordable. You can buy one for $2,500 for an average piece, up to maybe $10,000 for a really nice one. Those numbers aren’t overwhelming to a lot of pattern coin collectors.
Collectors Weekly: Are some patterns more rare than others?
Lustig: There are lots of unique coins and many more where only two or three exist. The most valuable of all is the 1849 20-dollar gold piece. There’s only one piece that’s known to exist, which is in the Smithsonian, although there is a second piece that’s rumored to be out there somewhere. If I had to bet, I’d say it does exist, but it’s never come to market publicly. If the Smithsonian’s piece came to market today, it would probably bring $15 million. That’s probably the most expensive U.S. coin.
The second most expensive pattern is a 1907 Indian head 20-dollar gold piece struck in gold, which is also unique. It used to belong to Teddy Roosevelt, and it was designed by Augustus Saint-Gaudens. The coin last sold for $475,000, I believe, in the early to mid-1980s. After a couple of private transactions, it ended up in a major collection of 20-dollar gold pieces. If it were to be sold today, it would probably bring $8 million to $10 million.
In 1879, the United States considered making a four-dollar gold piece (see photos at top). They struck two different designs, the more common of which is the flowing-hair design. They made 415 pieces in gold. It’s an especially rare coin and extremely desirable because it’s a gold pattern and it’s a denomination that was never struck for circulation, so it’s a fun coin. The only way you can go out and find a four-dollar gold piece is to buy one of these patterns.
These coins start at $50,000 for a coin that’s barely recognizable, and they could go up to $200,000 for a nice piece, more if you found one of the finest. And they are available.
Collectors Weekly: Are new patterns still being made?
Lustig: Back in the late 1850s through 1885, the U.S. Mint made lots of patterns for sale to the collector market. They went to local dealers and insiders. They all had access to these coins. And you could go to the Mint and request not only coins and patterns of the current year but even some of the older stuff. If they had the dies lying around, the Mint would even restrike coins for you. Fortunately for collectors today—or, depending on your perspective, it might be unfortunate—there weren’t that many people playing that game back then.
“Nowadays, almost every pattern that’s made at the Mint is destroyed.”
That went on for a while, and then in 1885, a new director of the Mint came in and essentially shut down the souvenir shop. You couldn’t buy patterns out of the back of the shop anymore. Since then, very few patterns have been made available, and even fewer have made their way out of the Mint.
But there were some exceptions. There were some experimental coins in 1896 that came out, pennies and nickels that are very interesting and collectible. I don’t know how they made it out. If I had to guess, I’d say there might be a couple hundred of those 1896 coins when you consider all the varieties.
Another group of patterns was created in 1916, when the Mercury dime, Standing Liberty quarter, and Walking Liberty half dollar were designed. There were some patterns for those and between one and five of each of those got out. Again, probably not out the back door but more likely as a part of the designers’ collection, or something like that. A lot of them tend to be circulated, so they were probably carried as pocket pieces. Probably by people who knew what they had, but the coins found their way into circulation at some point.
After that, there’s basically not much that’s available. If you look through the Judd book, you’ll see a few experimental pieces in 1942. Everyone knows about the 1943 steel pennies that circulated in the United States. There was a shortage of copper during the war, and they had to come up with some other metal to strike coins with, so they ended up with a steel zinc cent that circulated.
The 1943 copper cent is a famous rarity. That’s the one you see people advertising in the back of comic books, looking to pay $10,000 to $50,000 for. I’ve been reading those ads for the last 40 years, but the 1943 copper cents are errors, not patterns. A few copper planchets somehow made it into the Mint in 1943 and got struck instead of steel. Those errors are worth a hundred to $300,000 today.
In 1942, before they came out with the steel cent, they considered all kinds of different compositions. They considered plastic, tempered glass, aluminum—there was a whole series of experimental patterns struck in 1942 before they came out with those 1943 steel pennies. So that’s another group of coins that’s available.
Those coins, by the way, exist in two different ways. There are coins struck from the regular Lincoln cent dies. Those were all struck at the Mint. There were also these dummy dies. The reverse said “United States Mint,” and the obverse was taken from a Columbian one-centavo piece made in 1942. Those dies happened to be at the U.S. Mint, and the Mint did strike some experimental patterns from them, but they also made them available to outside manufacturers who were being considered as possible suppliers of the planchets for the new coinage in these alternative metals. Those pieces struck at the Mint are extremely rare. As for the privately manufactured pieces, hundreds exist in plastic, but those in other compositions are all extremely rare.
Collectors Weekly: What happens to patterns that don’t get used in circulation?
Lustig: They go to the Smithsonian, they go to a collector or they get destroyed. Nowadays almost anything that’s made at the Mint is destroyed, with only a few exceptions. They’re not available to collectors, but occasional things still slip out. In 1999, in anticipation of the Sacagawea dollar coin that went into circulation in 2000, they were considering various alternative compositions of golden-type alloys that might be used, and there are some experimental pieces that came out of the Mint from that period. Again, all of those are extremely rare yet surprisingly affordable. You can buy a 1999 Washington quarter struck on one of these experimental alloys for less than $5,000, even though there are very few of them.
Collectors Weekly: What are some of the major trends you’ve noticed in coin collecting?
Lustig: I would tell you two things: First, there are coin collectors and there are coin investors, and then there are all the people somewhere in between. Coin investing has been in somewhat of a decline since the late 1980s, but coin collecting has been slowly but steadily advancing, so the people who are buying right now have much purer collector mentality about it than they did when I started in the mid-1970s and the 1980s. In my way of thinking, that’s a good thing.
The other thing I’d say is that since I’ve been in the hobby—or the business, depending on how you measure it—the average age of the collector has increased significantly. There aren’t as many kids entering the hobby in the last couple of decades, which is primarily a function of it being so difficult to find interesting coins.
Forty to 50 years ago, kids could go into the bank, buy a bag of pennies and search through it to find things to fill their albums, scarce things and things that were more valuable than the face value. You could find silver coins in circulation at the banks, but today it’s impossible for kids to do that, so the hobby isn’t as interesting to them. As a result, I’d say over the last 40 years, the average age of a collector has probably increased 25 to 30 years. It’s a big shift, and it means that the average collector today is far more sophisticated than he was 25 or 30 years ago.
It’s exciting, but we still have to wonder where we’re going to be in 20 or 30 years when these guys start dying off. I hope that we do a good job and bring more people into the hobby. There’s lots of good work being done in that direction, and we’re far from doomed, but the market could be a smaller place in 30 years.
As far as patterns go, it generally takes a sophisticated collector to seek out and appreciate a pattern, so the increasing sophistication of the coin market has been good for the pattern market. With the Internet and all the books out there and the reach of the auctions, I don’t see that changing.
In the old days, it used to be difficult for a collector to participate in more than a few auctions a year, and often they were bidding based on pictures or even just written descriptions. Today, on the Internet, you can get incredibly good pictures of anything being sold anywhere in the world. You can participate in half a dozen auctions a week, and that doesn’t even include things on eBay. The opportunities to buy coins have increased dramatically. It’s much more feasible for a collector to enter a market like patterns today than it was 30 years ago because the coins are available. Now you can be everywhere. The Internet makes it viable to collect things that previously were very difficult to find.
Collectors Weekly: Are there overall categories that people usually collect in?
Lustig: There’s a collector for everything. Some things are more popular than others. There might be a million people in the country working on sets of Lincoln pennies but there might only be a hundred working on specific sets of patterns. That number’s probably realistic. The pattern market is much bigger than that because there are a lot of collectors who will just occasionally buy this or that, but there are relatively very few pattern collectors who are actually working on a specific set of something where they know exactly which coins they need.
There are about 2,000 different patterns, and you could spend a lifetime of money just buying one of this and one of that without really setting any boundaries. But it’s very rare for someone to get serious and say, “I want to put together a collection of the pattern nickels from 1883.” There might only be a hundred people that are serious about working within boundaries like that, and those collectors might only have the opportunity to buy one coin every two or three years because the specific coins they need don’t necessarily come to market as readily as they’d like them to. If there are only two in existence, you have to wait for one to become available. Most people don’t have that discipline.
Collectors Weekly: Is completing a set the collector’s goal?
Lustig: It depends on the collector. If someone’s collecting Buffalo nickels, for example, the logical way to put together a set of Buffalo nickels is to fill the album, so yes, you’re looking to complete the set. There are very few people who actually take on Buffalo nickels with the idea of just buying an occasional Buffalo nickel that turns them on. It’s so easy and it’s so well-defined and achievable that doing it any other way almost doesn’t make any sense. But when it comes to something like patterns, it’s almost just the opposite. It’s so difficult to complete a set of anything that most people choose to just buy an occasional piece that turns them on.
There is one other way to collect patterns and that is to buy the patterns that complement a series of regular coins. For example, a Buffalo nickel collector might want to buy one or two Buffalo nickel patterns to go with his collection. It would greatly improve the collection and he’d have things that no one else had, and that’s exciting. Then he knows exactly what he needs, but he’s not really a pattern collector. He just wants things to go with his Buffalo nickel set.
There are multiple ways of collecting patterns. The first way is to define a set and try to complete it. You have to define the set yourself, and that can be more challenging than it might sound. You’d actually have to go through a Judd book and figure out what exists. As I said before, one could collect all of the pattern Liberty Head nickels from 1883. Another good challenge would be to collect all of the Morgan dollar patterns of 1878. In my opinion, taking on a well-defined project like that is the best way to begin collecting patterns.
The second way of collecting patterns would be to just buy an occasional pattern that turns you on. It could be anything, or nothing in particular. Then the third way is to buy patterns that complement your collection of regular U.S. coins. So if you’re collecting Morgan dollars, you might want a Morgan dollar pattern or two. You wouldn’t necessarily have to have them all.
Collectors Weekly: What is the general state of the coin market?
At this point in time, nothing is hot. There are many areas of the market that are actively collected, but none of them are fad-like in popularity and none of them are increasing rapidly in value.
Truth told, there aren’t that many people coming into the market right now. At this point in the economic cycle, all the hardcore collectors are still collecting what they were collecting as much as they possibly can. The investors, for the most part, are on the sidelines, if not liquidating.
If you had asked me the same question 10 years ago, I would have told you the hottest area of the market is the state quarters. We had 50 states issuing coins, and everyone was buying albums and filling them up with coins out of circulation. There were people buying proof sets and silver proof sets of state quarters. It was a fad, but that’s over, and there’s really nothing to replace it at this point in time. It’s probably a good thing. The U.S. Mint tried doing the same thing again with these presidential one-dollar coins, but they don’t circulate so no one pays any attention and that set never materialized.
Collectors Weekly: How important is a pattern to a non-pattern collector?
Lustig: In general, people who don’t collect patterns get excited when they see one. They generally don’t think of themselves as being potential owners of the coins, but they get excited. Occasionally someone does jump over and become an avid collector. A lot of people have only read about pattern coins or seen pictures on the Internet, but at the average major coin show, you’ll find a hundred patterns on the floor.
Collectors Weekly: What can you tell us about the famous Liberty nickel?
Lustig: You’re talking about the 1913 Liberty nickel, which isn’t a pattern. They struck Liberty nickels for circulation between 1883 and 1912, and in 1913, a Mint insider struck off five pieces for his own benefit, which subsequently became very expensive coins. Each one is a multimillion-dollar coin. It’s interesting that you mentioned that coin because on the other side of the series, they also made a Liberty nickel in 1882 of the exact same design, and there are probably 75 of those in existence.
The 1882 Liberty nickel is a very popular coin, even with non-pattern collectors. There are only 75 people who have them, but again, some people buy them to go with their collection of Liberty nickels, some people buy them for their collection of patterns, and other people buy them just because it’s a cool coin. It’s one of the coins that we call a transitional pattern, and that just means that it’s the design that was adopted for circulation in the previous year. There are 2,000 different patterns in existence and maybe 20 transitional patterns, so they’re popular for that reason.
Collectors Weekly: Was the Mint looking for something specific with the patterns or was it just whichever was the most visually pleasing?
Lustig: In some cases, yes, they are looking for something in particular, and in other cases, the designers just decided to design something new to see if they could improve what was in existence. Sometimes no one even asked them to do the work. They just had some time on their hands and they came up with a new design. They know what the composition is supposed to be, they know what the size is supposed to be, they know what the denomination is going to be, and then they just run with it.
Collectors Weekly: What are private patterns from non-Mint dies?
Lustig: Those coins came about when someone not associated with the Mint had an idea. For example, in 1849, a coin designer named Bouvet was looking for a job at the U.S. Mint, so he designed a 10-dollar gold piece. He made the dies and sent an example of his work so they could see his capabilities. Now, that’s an example of a pattern from non-Mint dies—it was made for a semi-legitimate purpose. By the way, the coin was ugly and he didn’t get the job.
There are other situations where someone might make a pattern and try to make his own dies and market it on TV as a novelty item. That’s a coin that I would say has no legitimate purpose, but it also fits the category of a pattern from non-Mint dies. When you collect patterns, it’s really important to understand why the piece was made. Was it made for a legitimate experiment? Was it made as an artistic exercise by the designer? Was it made to solve a problem? Was it made to sell to a collector? Was it made to sell something on TV?
Once you understand why the coin was made, you’re in a much better position to decide if it’s something you want to put your money into. Personally, I find it much more interesting to own patterns that were made at the Mint for the purpose of solving a problem—legitimate experimental pieces, legitimate works of innovation. I find it less interesting to buy things that were made for collectors.
For example, they might take the obverse of one coin to the reverse of another design, so you might have a three-dollar gold piece on one side and a nickel on the other. There was no reason to make that coin other than to sell it to a collector for a few bucks in the 1860s or 1870s, so to me, that’s not interesting. It’s a novelty item, but not the type of thing I’d want to spend $60,000 on. Every collector has to make his own judgments, but my advice would be to understand exactly why a coin was made.
Collectors Weekly: What are some of your favorite stories behind the coins that you have?
Lustig: In 1814, the United States Mint struck a half dollar. They took the regular dies of a half dollar and made a coin in platinum. The half dollars for circulation at the time were silver. The United States Mint had never used platinum before for circulation. There’s no record of the U.S. Mint even considering using platinum for circulating coins, yet these coins are known to have been struck in 1814, and you know that because there are silver half dollars made from the same dies.
So why were they made? No one knows, but I have a theory. To me, it’s a theory that makes the coins interesting. My feeling is that those pieces are experimental in nature and they were made in preparation for a 10-dollar platinum coin. Again, the theory is that there were no 10-dollar pieces made in the United States in 1814, so there were no dies lying around from which platinum and gold pieces could have been struck.
When you have an 1814 platinum half dollar in your hand, it’s shockingly heavy because you’re looking at this coin struck from half-dollar dies, and as a collector you know what a half dollar feels like in your hand. It’s twice as heavy or so. It’s a mind-blowing thing for a collector.
Collectors Weekly: Are there any major coin collecting clubs?
Lustig: There are thousands of coin clubs. A good place to start looking for specialized coin clubs is the American Numismatic Association’s website, which is Money.org. They have lists of all their member clubs on their website. Beyond that, you can Google your way to a thousand different coin clubs online. There are also local clubs that actually have meetings. The major clubs have conventions, and there are all kinds of meetings that take place at those shows for specialized groups. Whatever you want, it’s out there.
Collectors Weekly: What advice would you give to somebody who is entering the world of coin collecting?
Lustig: I’ll give you two pieces of advice: First, you probably won’t keep most of the coins you buy early in your collecting life. You’ll want to sell them. You’re going to make mistakes. You’ll decide to collect something else. So it’s best to spend relatively little money early on to learn what you want to collect. Then you can start spending the real money.
Second, before you decide to collect a series, do the math, by which I mean you should know what it’s going to cost you to complete the project. I’d say four out of five collectors who decide to build various sets realize sometime in the middle of the project that they they can’t afford to do it and that’s simply because they never did the math. Take on a project that you can afford to do right. The hobby is much more fun when you can actually accomplish what you set out to do.
(All images in this article courtesy of USPatterns.com)