The inflation of the 1970s and early ‘80s alarmed many Americans, and gold coins were increasingly seen as the most reliable buffer against the falling dollar. This trend only accelerated with the speculative run-up of precious metal prices early in 1980. While these high figures soon came crashing down, there were many who had become convinced that owning gold was the only way to ensure their financial futures.
The most popular gold bullion coins of that time were South Africa’s Krugerrand (which contained one ounce of fine gold) and its various fractions. That nation’s internal politics, however, were so unpopular on the world scene that many in Congress were insisting on an American substitute for the Krugerrand.
Since the suspension of gold coinage in 1933 and its demonetization shortly thereafter, the United States had been opposed to its reintroduction in any form. As an alternative to calls for gold bullion coins, Congress approved the American Arts Gold Medal program. This offered gold commemorative medals in one-ounce and half-ounce sizes that honored American individuals in the arts and letters. Since they had no legal tender value these medals, issued 1980-84, were in keeping with the suspension of gold coinage, but this also lessened their perceived value to collectors and investors. They were given reeded edges and beaded borders beginning in 1982, which made them visually more coin-like, but this did not boost their poor sales. The appearance of actual gold commemorative coins in 1984 made the nation’s longstanding prohibition meaningless, and Congress decided to move ahead with a gold bullion coin program.
The law of December 17, 1985, created the Gold American Eagle bullion coin series. Included were issues containing one ounce, one-half ounce, one-quarter ounce and one-tenth ounce of pure gold. To provide protection under existing counterfeiting laws and to add to their collector appeal, these units were given legal tender values of $50, $25, $10 and $5, respectively. The fact that these divisions were disproportional to their relative gold values was a bit awkward, but it mattered not a bit in the long run, as the coins were too valuable intrinsically to ever circulate at those face values. By law the bullion for these coins is to come from newly-mined, domestic sources, though this requirement may be waived when such supplies are not available.
For the obverse of the Gold American Eagle coins the U.S. Mint revived a popular image from the past. The striding figure of Liberty seen on circulating twenty-dollar pieces of 1907-33, a design originally created by the brilliant sculptor Augustus Saint-Gaudens, was re-interpreted by the Mint’s current staff (Saint-Gaudens’ elaborate monogram appears above the rock outcropping at four o’clock). Though trimmed of a few inches at her waistline, Miss Liberty emerged as a close enough copy to please collectors. Unlike the original 1907-33 coins the bullion pieces carry their mintmarks, if any, below the date. All other features of the original obverse remained the same, with the exception of two more stars added to the circle of stars around the border signifying the number of states in the Union.
The common reverse for the one-ounce coin and its fractions was designed by Dallas artist Miley Busiek. It shows the "Family of Eagles," in which an adult eagle carrying the olive branch of peace is about to land in a nest containing the other adult and their two hatchlings (this theme was an apparent reference to the one-ounce coin and its three fractions). In addition to the usual statutory legends required of all United States coins, the inscription "1 OZ. FINE GOLD" is added along the lower border to establish this coin’s bullion content. Finally, the initials ‘MB’ of the designer and ‘JW’ of Mint Sculptor-Engraver Sherl Joseph Winter are seen below the nest at left and right, respectively.
The standard of each Gold American Eagle is the same as that of the Krugerrand pieces, .9167 fine. The balance of their composition is comprised of almost equal amounts of silver and copper. This awkward fineness was then already falling out of favor, as other nations had begun introducing gold coins of nearly pure gold without alloy. Though the Gold American Eagle series continues to maintain its original composition, the competitive demand for pure gold coins is now being met with the Gold American Buffalo series.
The first Gold American Eagle coins were dated 1986 and debuted in the fall of that year. They have been steady sellers ever since, though one very visible change has been made since their inception. In adapting Saint-Gaudens’ design from 1907 the Mint copied his usage of Roman numerals for the date. While quite elegant in appearance, the simple fact is that very few people today know how to read these numerals, and those who do don’t care to be squinting their eyes to date a bullion coin. The Roman dates were supplanted with modern ones beginning with 1992’s mintage.
The uncirculated editions of these coins are sold in bulk by the U.S. Mint at slight mark-ups over their bullion values to approved distributors who have the means to purchase very large quantities. These coins are then distributed to other wholesalers in increasingly smaller parcels, each vendor taking a profit that is small by the single coin but which is made up in quantity. Ultimately, the coins find their way to retailers who then provide them to collectors and investors.
Gold American Eagle coins are struck at the West Point Mint, though the uncirculated pieces do not normally carry mintmarks. An exception occurred in 1999, when one-tenth ounce and one-quarter ounce proof dies bearing the ‘W’ mintmark were prepared for uncirculated coinage by mistake. These 1999-W uncirculated pieces are very scarce and remain in high demand from collectors.
While the original intent of the Gold American Eagle coinage was to provide a convenient means for investors to set aside gold as part of their portfolios, interest on the part of coin collectors was immediate. The Mint anticipated that collectors would desire proof pieces, so these were offered from the outset for the $50 coin and introduced incrementally for the other denominations over the next two years. Each proof coin carries a mintmark to indicate its place of manufacture. Proofs of the $50 coin have all been struck at West Point since 1986, while the $25 issue was coined at Philadelphia 1987-93 and at West Point since 1994. The $5 and $10 proofs did not appear until 1988, at first being coined in Philadelphia through 1993 and at the West Point Mint thereafter.
One thing that the U.S. Mint did not expect was the great collector interest shown in the ordinary, or uncirculated, Gold American Eagles. Though they have from the beginning been handled and delivered with greater care than circulating coinage, these pieces are nonetheless highly prized in the top grades. Several condition rarities have emerged, and these are keenly sought for placement in online certified registry collections.
For the 20th anniversary of the American Eagle program in 2006, the U. S. Mint offered what were apparently one-time-only commemorative issues. Though bearing their familiar designs, these coins had some unique features that made them enormously popular with collectors. An uncirculated edition of each denomination was offered bearing the ‘W’ mintmark normally seen only on proof coins, while a special "reverse proof" was also produced for the $50 coin alone. Instead of the brilliant fields and frosted devices of normal proofs, the reverse proofs displayed frosted fields and brilliant devices. All of these anniversary emissions were quick sell-outs and added more fuel to the already hot market for Gold American Eagle coins.
