Editor's Note: This is one of three esteemed collectors whose collecting prowess is profiled in this series.
By Mike Fuljenz
Coin collecting used to be called “The Hobby of Kings” because primarily wealthy aristocrats pursued it. Today, it is better known as “The King of Hobbies” – and far from being the province of the elite, it’s a thoroughly democratic pastime enjoyed by people of all ages and socioeconomic status. Its popularity has grown so dramatically, the U.S. Mint estimated during the height of the 50 States Quarters Program that there were 140 million collectors in the United States.
A Fusion of Interests
Coin collecting combines the excitement of a treasure hunt and the thrill of discovery with healthy doses of history and romance. Coins are often described as “history in your hands,” and the term is entirely accurate. Those gold coins in today’s hobby holders might well have been retrieved from a 19th-century shipwreck – or possibly recovered from the loot of an Old West train robbery. Or they might have spent decades in one of the great collections from a bygone generation. Pure gold is impervious to corrosion. So even after centuries at the bottom of the ocean, gold coins ofen emerge looking as good as new.
Scarcer, more valuable coins seldom turn up in circulation; they have to be purchased at a premium. Through the years, however, these have often over time proven to be extremely sound investments for those who bought them wisely – particularly those who concentrated on coins of unusual rarity, exceptional quality, or both. While their owners appreciate the history and beauty they embody, these coins often appreciate in value.
In some past bull markets, coins have drawn greater interest, and brought higher prices, when sold as components of comprehensive special collections, more so than when they have been offered individually. In such cases, the whole, so to speak, has been greater than the sum of its parts. One reason for this is that fine collections often showcase the coins in the most appealing way and thus attract a broader pool of potential buyers.
The Path of Provenance
Indeed, the value of some coins can increase substantially if they have reposed in fine, well-known collections. This quality, known as their “provenance,” gives them a special aura in the eyes of many collectors, much as precious gems are considered more desirable if they once belonged to a monarch or a movie star.
Through the years, virtually all of the most famous and most valuable U.S. coins have belonged at various times to one or more of the greatest collectors in the hobby. This is partly a matter of economics. Often, great collectors have been persons of considerable means, whose wealth enabled them to buy costly coins other hobbyists couldn’t afford. But savvy and shrewdness combined with reading reliable research materials have enabled people of far more modest means to build great collections as well.
These collectors took different paths to reach their goals, but in the end they all achieved the same ultimate goal: the formation of collections that earned great admiration and rewarded them or their heirs with handsome profits. It’s instructive to see how some of these great names of collecting did it.
LOUIS E. ELIASBERG
Louis E. Eliasberg Sr. came to be known as “The King of Coins” after he accomplished a feat many thought to be impossible: Over a period of less than two decades, from 1934 to 1950, Eliasberg assembled the only complete collection of U.S. coins – the only one that contained regular-issue coins of every denomination from every date they were issued and every mint that made them in those years. News of this achievement not only electrified fellow hobbyists but impressed the nation. It was considered so significant that Life magazine, then read by millions of Americans, featured Eliasberg and his coins in a lavish photo layout.
Yet this “King of Coins” didn’t have kingly wealth. He lived comfortably on his income as a Baltimore banker. But his budget for buying coins was not unlimited. Nor was he known as a big spender: Dealers who did business with him found him to be a cautious buyer who took out his checkbook only after careful deliberation.
Unplanned Interest in Collecting
Eliasberg wasn’t even a hobbyist when he started buying coins: He did so as a way to circumvent the Gold Surrender Order of 1933, which required U.S. citizens to turn in their gold coins but exempted collectible coins.
“I realized the only way I could legally acquire gold was by becoming a numismatist,” he explained years later. “So in 1934, to the extent of my means, I started buying gold coins.”
Soon bitten by the hobby bug, he started buying other coins as well, and within a few years he had built a respectable collection. Then, in 1942, came a marvelous opportunity: He was able to purchase outright the outstanding collection of John H. Clapp, in the process acquiring many rare coins he didn’t already possess. That’s when he began thinking seriously of pursuing the impossible dream: a U.S. coin collection with “one of everything.” He prepared a list of coins he lacked and started tracking them down in auctions and in dealer inventories.
“Eliasberg struck me as a gentleman,” one prominent numismatist later recalled. “He was tall, aristocratic, a genius at finance, but he didn’t know very much about coins … He knew more about making money.” His success at making money has become the stuff of legends in the coin collecting community.
During the decade and a half it took him to complete his collection, Eliasberg spent less than $400,000. When the collection was sold, at a series of auctions between 1982 and 2005, it realized a grand total of roughly $55 million – more than 100 times what he had paid.
The gold coins he started buying in 1934 not only turned Eliasberg from a numismatic novice into a great collector, but also ended up confirming his status as a very successful investor: When his heirs put them up for sale in 1982, they brought more than $12 million. In short, even if he had never begun pursuing the seemingly impossible dream of collecting “one of everything,” Eliasberg would have made millions just through his decision to buy gold coins as collectibles.