US Coins 10 Dollar Gold Coin 1852 United States Assay Office of Gold
When Augustus Humbert was appointed United States Assayer of Gold in 1850 and came to California in 1851, his mission was to assay and strike coins in denominations no smaller than $50 (the original authorizing legislation specified up to the $10,000 denomination). However, this soon proved to be impractical as daily commerce required coins of smaller denominations. Many private firms tried to fill the need for smaller denomination gold coins, but were of inconsistent purity across coiners, a situation that came to a head with the exposés of James King in March 1851. As a result, many private issues ended up in Humbert's melting pots to be made into the $50 slugs. Even though Humbert petitioned the Treasury for permission to produce coins in smaller denominations, it was not until 1852 that they finally relented and production of $10 and $20 gold coins commenced. These found immediate use in California and were heavily used until the San Francisco Mint could produce enough gold coins of their own. No more than 75 examples of the 1852 $10 gold piece of any variety are thought to exist in all grades. All in all, a Choice example of an always popular Gold Rush survivor.
Private Gold Coins of the United States
10 Dollar Gold Coin 1852 United States Assay Office of Gold
UNITED STATES ASSAY OFFICE IN CALIFORNIA
History of the United States Assay Office
While the government’s response to the need for an adequate coinage was slow and never satisfactory, two institutions were established (the State Assay Office of California and the United States Assay Office) that did provide an unconventional and partly successful attempt to supply a frontier area with an acceptable quantity of an "official" circulating medium.
The private coinage proscription was not enforced by the public or government because the State Assay Office failed to mint enough ingots for the local demand. Ironically, an institution that was designed to replace the need for private gold minting actually preserved it (i.e., Moffat & Co.'s undebased coins from the first period continued in circulation) and in fact stimulated its resurgence (i.e., the second period of private gold coinage).
The history of the U.S. Assay Office can be broken down into three major time periods:
State of California Assay Office under F.D. Kohler (1850-1851)
The products of the State Assay Office were contemporaneous with the Second Series of private gold coins. As previously stated, the law establishing this assay office was passed along with a companion bill which would have eliminated private gold coinage, had it been enforced.
The State Assay Office of California was a unique institution in our nation’s history. It was the only mint to operate in this country under the authority of a state, after 1789. Its issues (though never challenged in the courts) may have been illegal under the United States Constitution, which forbade any state to issue coins or currency. These issues were the first ingots to be called “slugs,” a name later used to describe any private coin, particularly those used today in coin-operated machines.
As related earlier, gold dust was the principal circulating medium in California in 1848 and 1849, while talk constantly referred to the need for a standard medium of definite value regulated by the government. As early as July 22, 1848, petitions for the establishment of a State Assay Office in California had been presented to Governor Mason. With the advent of underweight private coinage, the merchants of San Francisco once again gathered to discuss how they could use the gold dust obtained by the quicksilver (amalgam) process as a circulating currency acceptable to all.
A meeting was held on March 29, 1850, to select a committee to look into this matter. When the committee delivered its report on the 5th of April, the entire gathering drafted a resolution addressed to the State Legislature refusing to receive “California Coin” (i.e., privately struck, non-governmental coins) as currency, and praying that a State Assayer be appointed who would assay and stamp ingots stating their correct fineness, weight, and United States mint value.
The next day over 400 more San Francisco citizens signed the petition asking that the state establish a State Assay Office with authority to melt and assay gold dust and issue coins (i.e., ingots) bearing the state stamp. A state institution, so it was thought, would eliminate from circulation the various undervalued private issues, standardize the price of gold fineness, and thus restore confidence in gold coinage. The proposal was approved by the Legislature and the act creating “the office of State Assayer, Melter, and Refiner of Gold” became law on April 20, 1850.
It was probably in anticipation of a State Assay Office that the state leaders on April 8 passed a bill forbidding the issue of any pieces of gold of less than four ounces troy weight, and the additional act of April 20 which made it mandatory for all private coiners to redeem their products at face value in U. S. coin on demand. Although the law initially ended the first wave (1848-50 period) of private gold coiners, it was not enforced since the need for coins in excess of the State Assay Office’s production, and especially those in denominations lower than those produced by the Assay Office, immediately became apparent.
In compliance with a petition from leading citizens of San Francisco to Governor Peter Burnett, Frederick D. Kohler was appointed State Assayer. O. P. Sutton, another former New Yorker, was appointed director of the State Assay Office.
Kohler had been associated with then State Senator David C. Broderick in an assaying and coining business (see Kohler & Co.). It is perhaps ironic that a man presumably associated with privately issued coins worth 20 percent less than face value (see Pacific Company) was later appointed State Assayer. But perhaps his past association was not revealed until later, if at all; the Pacific Company coins had not yet been either decried or publicly attributed to him.
The act provided that the State Assayer was to refine and assay gold dust and cast it into ingots weighing a minimum of two troy ounces. These pieces were to bear the state name, value, weight, and carats of the ingot. They also carried a quasi-legal status in California since the U. S. Constitution did not specifically say it was illegal for states to issue ingots. (Article I, Section 10, United States Constitution, specifically forbids states from “coining money” and issuing currency.) It is subject to debate whether the Constitution’s drafters intentionally excluded ingots from their prohibition. No states were empowered to declare anything but gold and silver legal tender, which means that they were able to confirm the (national) legal tender status of gold and silver; but as the form in which the gold and silver could be tendered was nowhere specified, this loophole neatly admitted the possibility that California could declare native gold bars or coins a legal tender. The whole operation was to be abolished upon creation of a United States provisional branch mint in California.
It can be argued, nevertheless, that the creation of the State Assay Office seems to have been a direct violation of the United States Constitution, which forbids the issuing of coins by a state (the principal difference between an ingot and a coin being their shape, not their purpose). Perhaps because California was under a military government at the time and not admitted as a state to the Union until September 1850, the Federal Government chose to overlook this issue. Besides, the State Assay Office was a temporary expedient until a branch mint could be approved. In any event, no coins were issued, only ingots of more than two troy ounces.
Evidently there was some delay in starting the operation because Director Sutton doubted whether it would be as profitable a venture as he had at first expected. He also felt that there would be time enough to start the office’s operation after the law creating the office had been publicly announced.
On the thirteenth of May 1850, the following announcement appeared in the Pacific News:
"The undersigned have opened an office in the building now occupied by Messrs. Baldwin & Co., south side of Portsmouth Square, and will be prepared to receive gold dust for smelting and assaying on Monday the 13th, in accordance with the provision of the law passed by the Legislature of the State April 20, 1850. In making this announcement, we beg leave to state that desiring to establish an office at the earliest practicable moment, our arrangements are necessarily less complete that they otherwise would have been; nevertheless, we trust that they will be found sufficient to meet the needs of the community."
O. P. Sutton, Director
F. D. Kohler, Assayer
San Francisco, May 10, 1850
The new State Assay Office met with immediate public acceptance. Five thousand ounces of gold were deposited the first day, and the establishment was forced to operate day and night to accommodate the rush of gold dust.
The law providing for the State Assay Office made provisions for branches in Sacramento, Stockton, and Sonora. The officers of the State Assay Office made plans in early June to open an office in Sacramento to position themselves closer to the gold mines.
John Bigler, who later became Governor of California, was appointed director of the Sacramento operation. Bigler’s assistant, Milton S. Latham, later served as U. S. Senator and Governor of California. Kohler evidently also moved to Sacramento, leaving a deputy in San Francisco. Formal announcement of the new Sacramento office, to be opened July 1 on Third Street near the corner of J Street, was made June 28, 1850.
The ingots of gold issued by the State Assay Office had their weight, fineness, and value stamped on them. Their value ranged from $36.55 to $150.00. The “$50 slugs” – which is what they were sometimes called at that time – were probably the most common. An account (in the Alta California for November 20, 1868) of this assaying process by a visitor to the office states: “I gazed into the Assay Office of Fred Kohler, situated on the south side of Clay Street, watching for the first time the process of converting gold dust into bars, and the clipping of the bars into $50 ingots.” To date only one $50 ingot is known.
The account continues that “the bars of gold were cut from strips into convenient sizes. From their appearance, it seems these cast bars were then beaten with hammers or rolled in order to make the final product of a desired uniform thickness.” Most likely these bars were rolled into shape.
The ingots were assayed at 1 to 1 ½ percent over the value stamped on them, but certain sectors of the business community did not condone their acceptance at face value. Gold dust had been purchased previously by bankers and dealers at below its standard value of $16 per ounce. It was to these merchants’ advantage to hold down the price of gold locally. The State Assay Office ingots prevented this and in retaliation, many prominent bankers refused to accept the assay ingots at par. This shortsighted action in turn prompted a defiant announcement by several leading Sacramento merchants reaffirming their intent to honor the State Assayer’s ingots at the value stamped on the pieces, rendering the bankers’ boycott ineffectual.
The exact number of ingots issued by the State Assay Office is not known. A statement in the Daily Transcripts of August 8, 1850, mentions that 161 deposits were made at the Sacramento branch up to that time with the total value, at $16 per troy ounce, of $59,028.80 (enough for about twelve hundred $50 ingots). At least two such ingots are known today. In all likelihood, almost all the ingots were soon remelted to recover their higher intrinsic value. The State Assay Office was discontinued on January 29, 1851, with the establishment of the United States Assay Office, which began operations February 1, upon the repeal of the act creating the State Office.
While working at the State Assay Office, Assayer Kohler carried on his duties as chief engineer of the Fire Department until he resigned from the Fire Department on August 26, 1850. After the close of the State Assay Office, Kohler evidently moved back from Sacramento to San Francisco to work with private coiners Wass, Molitor & Co., for the following advertisement appeared in the Alta Californiaon July 24, 1853:
U. S. ASSAY OFFICE
FREDERICK S. KOHLER
United States Assayer Office – at Wass, Molitor & Co.’s
Jy 24 Merchant St.
This interesting statement is suspect since nowhere else is the suggestion of Kohler being a United States Assayer corroborated. Also intriguing is the fact that this advertisement appeared just two days before the official dissolution of Curtis, Perry & Wards’ State Assay Office. What Kohler was doing from January 1851 until July 1853, and why he called himself United States Assayer, remains a mystery.
The United States Assay Office under Moffat & Co. (1851-1852)
Coins issued by Augustus Humbert as Assayer of Gold
1851 $50
1852 $10
1852 $20
The United States Assay Office under Moffat & Co. with Augustus Humbert as Assayer (1851-1852)
Most Californians were not satisfied with merely a State Assay Office and demanded a United States branch mint, which could after all make real coins in lower denominations. Throughout 1849 and 1850, several proposals were introduced in the California Legislature and United States Congress providing for the establishment of a branch mint in California.
Champions of this cause in the Thirty-first Congress were Missouri Senator Thomas Hard Benton and Senator William M. Gwin of California, who made several speeches and wrote many letters in support of a San Francisco branch mint. In one such letter (November 20, 1850) to Treasury Secretary Thomas Corwin, Gwin stated that “some Four Millions of dollars monthly or about 250,000 ounces of dust,” are extracted from the California mines. “Half of this is sent abroad at a loss of two dollars an ounce ($16 vs $18 at the U. S. Mint).”
Both Benton and Gwin’s attempts were thwarted by the insistence of the New York delegation, which felt equally entitled to their own mint. This proposal in turn was vigorously fought by the jealous and powerful Pennsylvania delegation that believed both proposed mints, especially New York’s, would be a threat to their established Philadelphia mint. Similarly, the delegations from Georgia, North Carolina, and Louisiana were not happy with the prospects of more competition to their respective United States branch mints.
A compromise bill, therefore, was passed on September 30, 1850, providing for a United States Assay Office to be established in San Francisco. This Office would have the authority to assay gold and stamp it with an appropriate seal to show its value. The California delegation agreed to the compromise bill only after being convinced that a branch mint would be authorized for California at the next session of Congress.
The original bill provided for issuances in denominations of $50 to $10,000; “They are to be struck of refined gold, of uniform fineness, and with appropriate legends and devices, similar to those upon our smaller coins, with their value conspicuously marked, and the inscriptions LIBERTY and UNITED STATES OF AMERICA.” A letter which reposes in the National Archives has “C. C. Wright” written in the upper right-hand corner. Wright was a contract engraver to the U.S. Mint at this time, and designer of the first U. S. Assay Office $50 gold coins. The letter displays the original design (later adopted) for the $50 gold coins of the U. S. Assay Office:
"50 – 100 – 250 – 500 – 1000
On the Ingots and on the bars, The Stamp will represent and Eagle in an attitude of defiance with the usual United Stated Shield resting upon a rock representing the Constitution – In the claws of the Eagle are the Olive Branch and the Arrows.
The words, “United States of America,” as in the coins of the U. S. Mint, surround the Eagle – In a scroll held in the beak the word “Liberty” – immediately over the Eagle the word "Thousandths” with a space to stamp the “degree of fineness” (see #) Upon the ingot, without the circle, the weight in pennyweights and grams – thus [. . . Dwts . . .Grs].
Around the edges of the Octagon the words Augustus Humbert United States Assayer of Gold California 1851.
The reverse side of the Octagon ingots will present an embossed surface known to mechanics as “Engine Turning” and similar to the web-like engraving of the vignette of Bank notes. The Die that produced this effect cannot be easily imitated and the machine that executes or engraves the Die is the only one in the United States."
A similar description appeared in the financial newspaper Prices Current after the first coins were issued on February 14, 1851: The larger ones of one and two hundred dollars are exactly similar to the $50 denominations except they are proportionately thicker. The reverse< side bears an impression of rayed work, without any inscription. Upon the edge is the following: “Augustus Humbert, U. S. Assayer – California Gold 1851.” Those of Five Hundred and One Thousand Dollars are in the form of parallelograms, about five inches in length, and one and three-quarters in breadth and varying in thickness, the small being about three-tenths of an inch, and larger six-tenths.
These are interesting statements since they reveal that specimens of $100, $200, $500, and $1,000 ingots were made or at least planned. The Alta Californiaof February 21 also mentions the proposed $100 and $200 coins. Records compiled by Augustus Humbert indicate, however, that only $50, $500, and $1,000 ingots were issued for general use. Only one specimen exits today of a $200 ingot evidently made for experimental purposes. The Alta Californiareport indicates that 300 pieces were struck on February 20, all bearing “50 DOLLS” at the bottom. However, there are no coins known today bearing that description. Instead, they bear the figures “50 D. C.”
The ingots of the U. S. Assay Office were accepted for all customs duties by customs officer T. Butler King upon authorization from the President, but unfortunately Congress stopped short of according them full legal tender status. As a matter of fact, Mint Director George N. Eckert clarified his office’s position on this issue by stating that, “Even these are not money, or a legal tender, and the government is under no obligation to receive them.” This was intended to evade the provisions of the Act of January 18, 1837, which prescribed fixed alloy ratios for coins.
The establishment of this new U. S. Assay Office by Congress was met with skepticism, or guarded optimism at best, by the California journalists. The editors of the Courier felt that Senator Gwin’s original bill for issuing rectangular gold coins or ingots of $100, $250, $500, $1,000, $5,000, and $10,000 to be of 980 parts gold to 20 of alloy, “may be all right – but if it is we cannot see it.” The Alta California, disappointed in Congress not authorizing a mint, said of the proposed assay office ingots:
"These ingots [actually, octagonal-shaped coins], with the U. S. authorized stamp of fineness, weight, and value, will so far have an advantage over the others, as men’s confidence in its officers exceed what they have been willing to yield to the state assayer and private companies. For our own part we do not consider that as any advantage whatsoever."
The paper went on to prognosticate that although the Assay Office coins would be accepted for custom duties, “”If these ingots and bars are not received by merchants and others in exchange for commodities, it will be a failure.” The fact is that the new issues under the auspices of the U. S. Assayer were generally received by merchants and eventually proved very successful, for the local price of gold rose two dollars to eighteen dollars – a level almost equal to gold received at the Philadelphia Mint.
Moffat & Company petitioned for and received the contract for coining the new issues of the U. S. Assay Office and, in a letter to Treasury Secretary Corwin, Moffat made the dubious statement that his company alone was then (September 30, 1850) operating a mint in California. Augustus Humbert, a watchmaker in New York, was appointed United States Assayer with a salary of $5,000 a year, while sculptor and medalist Charles C. Wright was commissioned to engrave in New York the original dies which Humbert was to bring with him to California.
Moffat & Company immediately ceased their own operation and prepared for the increased business under their federal contract by moving from Clay and Dupont Streets to larger offices on Montgomery Street between Clay and Commercial. On January 22 the following notice appeared in the Herald:
"United States Assayer’s Office – we give notice that on or about the lst February ensuing we will be prepared to receive Gold Dust for SMELTING AND ASSAYING and forming the same into ingots and bars in accordance with our recent contract with the Secretary of the Treasury, authorized by an act of Congress approved 30th September, 1850, “under the supervision of the United States Assayer” AUGUSTUS HUMBERT, Esq., who will cause the United States stamp to be affixed to the same.
Moffat & Co.
We also announce our intention of erecting forthwith extensive Reverberatory Smelting Furnaces for the purpose of reducing ores and gold-bearing black sand.
Due notice will be given of the removal of the U. S. Assayer’s Office to Montgomery Street.
Moffat & Co."
Humbert arrived in San Francisco with the dies on January 30, 1851, and the first coins of his office were produced on January 31. A representative of the Pacific News saw a specimen the next day. Production of ingots began February 14. These first $50 specimens (i.e., coins) were made so that their value could be stamped after the die was used, by leaving space between the “D” for dollars and the “C” for cents.
The unique $50 octagonal shape soon became a symbol of California coinage and was known as a “slug.” Their reverse is an example of what machinists call engine-turning – a design of several concentric circles used on watches of that period. Wright only designed the first issues, with all later issues apparently engraved locally by Albert Kuner.
Reactions to these first pieces were mixed. A wealth of comments, both pro and con, appeared in virtually every newspaper in the area. Many of them pointed out that several immediate benefits resulted from the issuance of these Assay Office ingots. The new “government” issues forced most of the inferior privately issued gold pieces out of circulation, although the private coiners did not cease operations until March. The Mormon and Pacific Company coins especially were received at their true intrinsic value and remelted into $50 slugs. This sufficiently cleansed the business world of debased coins formerly tolerated because of necessity.
A second advantage of the new $50 gold pieces was their receivability for custom duties. Customs collector T. Butler King, after having been authorized by President Fillmore on December 2, 1850, to receive these ingots, announced in the Alta Californiathat he was “authorized to receive those bars and ingots at the Custom House.”
Because of these first two advantages, a committee of businessmen gave tacit approval to the new issues. Still, they looked upon them “as a temporary measure only, which the necessities of the country require” until a United States Mint was established. The Pacific News hailed this development as an immense public benefit. The paper acknowledged, however, that an additional resolution by the bankers agreeing not to accept any private mint issues except Moffat & Co. would cause inconveniences and losses to holders.
However, there also was dissatisfaction with the new issues. The Herald printed a series of articles condemning the Assay Office for charging citizens too high a seigniorage. The editors claimed that Moffat & Co. held a virtual monopoly on coin production, with their charge of 2 ¾ percent being excessive.
Moffat replied to these charges by stating that labor prices were higher in California than in Philadelphia and their charges reflected this. The Courier (June 28, 1851) also had a number of unfavorable comments to make concerning the United States Assay Office:
"It is no other than a huge, legalized swindling shop. The establishment of this institution, for the benefit of a few persons, who expect to make a fortune and then return home, is such a monster-atrocity that we do not see how those who aided and abetted in imposing it upon us can look an honest man in the face."
Accusations that Moffat & Co. did not redeem their coins in the then more valuable silver without a discount were even uttered on the State Senate floor, but specific charges are vague.
Another powerful vested interest that was not altogether happy with the U. S. Assay Office was the banks. As previously stated, the value of gold rose dramatically after the Government Assay Office commenced operations. The bankers were soon compelled to increase their offering price on gold dust, thus lowering their profits. In addition, the U. S. Assay Office compelled the abandonment of the private mints to which the bankers had been selling gold dust. On the whole, the charges made against Moffat & Co. were petty, vague, or unfounded and soon dissipated as a major crisis arose – an acute shortage of coins under the $50 denomination.
On March 25, 1851, the State Legislature repealed its act preventing individuals from minting coins and modified the law so that the coins could be issued if regulated by the state. But the new law insisted that issuers redeem their own coins in U. S. gold or silver upon presentation.
Although this new statute was not readily enforced, an unfavorable assay report on private gold coinage appeared three days later in the California press and, coupled with the new law and the establishment of the United States Assay Office, effectively led again to the disappearance of all private gold issues except the cumbersome United States Assay Office $50 gold pieces. On the 14th of April, Moffat submitted his March report to Treasury Secretary Thomas Corwin indicating the effects of the published assay report:
The effect was instantaneous and overwhelming; the private mints were at once compelled to suspend operations, and their issues amounting, we have reasons to believe, to a million and a half, have since been purchased at a discount of from 5 to 10 percent, and it is not at all likely that another private coin will ever be struck in California.
Moffat added that his U. S. Assay Office coins were popular and there had been a steady increase in business. But he also pointed out that the “sudden withdrawal from circulation of so large amount of private coin” of smaller denominations – almost $3 million worth – necessitated the granting of authority to issue coins of denominations less that $50.
It was three months before Moffat received a reply. On July 9, acting Secretary of Treasury William L. Hodge responded to Moffat’s pleas for minting smaller denomination coinage by flatly stating, “It is not deemed expedient at this time to authorize the assay and stamping of ingots of less denomination or value than fifty dollars.” There seems to be no apparent reason for this lack of foresight by the Treasury Department.
Upon being subjected to such cavalier treatment, the press and general public once again began decrying the sorry economic state of the area. The Alta California, calling the $50 pieces “monstrous chunks” and “a decided nuisance,” related how citizens purchased small articles just to get the large fifties changed into smaller denominations. The Alta California itself was required to change one for the sale of a twenty-five cent issue of its own paper.
The Picayune (October 21, 1851) printed the story that foreign coins (which circulated until the Coinage Act of February 21, 1857) were being used for small change and the resulting demand for silver coins had caused them to become scarce. A correspondent for the New York Journal of Commerce reported in the October issue of the Bankers Magazine that the $50 slugs were discounted by bankers by 2 percent and five-franc pieces were given as change at the rate of one dollar each (about 120 percent of their face value).
In addition, small American gold coins were being purchased at a premium of ½ to 1 percent as the situation continued to deteriorate. Sloat’s San Francisco Prices Current substantiated this report, and in December 1851 the Herald announced that the $50 slugs were being discounted from 2to 4 percent or as low as $48 each – not much of an improvement over the undervalued private coinage of several months just past.
In December, Moffat once again urged Secretary Corwin to authorize his company to issue small denomination gold coins. Business for November was only one-half that of October, Moffat explained, and the cause was “attributable to the great scarcity of coin denominations of 20 Dollars and lower,” Moffat pointed out that a 3 percent premium was now being paid for small American coins and, in his strongest statement, Moffat exclaimed that, “The inconvenience, annoyance, and actual loss the community is suffering from this state of things, brings odium upon the Assay Office.”
Accompanying this letter was a similar one from Humbert adding that bankers were restricting their depositors to writing checks for round amounts or suffering a discount. As a further encouragement for granting the new authority to issue smaller denominations, both Moffat and Humbert informed Corwin that another private coiner (Wass, Molitor & Co.) had already engraved dies for a new, smaller denomination issue.
Meanwhile, it seems that Moffat & Co. was ready to take action on its own. In January 1852, it solicited and received a favorable legal opinion from its attorney, J. H. Clay Mudd, on the question of whether “Moffat & Co.” could issue $300,000 of its own (smaller denomination) coin, independent of its government contract, to comply with an appeal to it from the principal bankers and merchants of San Francisco. There is an important endorsement at the end of this legal opinion from Customs Collector T. Butler King stating that he concurs with Mr. Mudd’s view and arguments. On or about January 12, Moffat & Co. privately issued its 1852 $10 gold pieces.
On December 9, 1851, Secretary Corwin had written to Humbert finally authorizing Moffat & Co. to issue $10 and $20 gold coins under the auspices of the U. S. Assay Office. This letter had been enthusiastically received by Humbert on January 10, 1852. Dies for $5, $10, and $20 gold coins under the auspices of the U. S. prepared in 1851 in anticipation of a favorable Treasury response were probably in the process of being altered to read “1852” when two days later, Humbert received a second letter from Corwin suspending the earlier authority.
Corwin’s explanation, dated December 10, was the introduction into Congress of a bill, “connected with a Mint and Assay Office in San Francisco.” Mentioning the limited circulation of Wass, Molitor & Co. coins (although not by name), an incensed Humbert urged Corwin to reconsider his latest position.
The next day Moffat wrote a letter similar to Humbert’s, adding that the coins of Wass, Molitor & Co. pass at a 2 percent premium to those of the Assay Office and the business of Moffat’s office had nearly ceased, not having been able to pay its expenses for the last thirty days. In this letter to Corwin, Moffat mentioned the petition sent him by several leading merchants and bankers urging him to issue $300,000 worth of private coinage of under $50 denomination.
He also included the Mudd opinion, stating that his company had not yet commenced the issue (of $10 and $20 coins) but “shall do so in a few days and will, of course, discontinue it, should the instruction of the Department of the 9th Dec. ult. (and countermanded by those of the following day) be confirmed.” This communication refers to the “Moffat & Co.” issues dated 1852 and not the Assay Office issues inscribed “1852/1.”
Either Moffat was mistaken in his dates or he deliberately misled the Treasury Secretary, for the day before he wrote Corwin that his company had not yet commenced issuing coins, the Prices Current announced, “that Messrs. Moffat & Co. and Wass, Molitor & Co. have again commenced to issue small coins.”
The inclusion of Moffat & Co. in this announcement may also have been a mistake, but that is doubtful since in its reply to the merchant’s petition, Moffat & Co. promised delivery of the new coin by “Monday next,” which was the 12th. The firm in all probability issued its 1852 $10 pieces between January 12 and January 27, 1852, with a total of $86,500 in $10 “Moffat & Co.” coins being struck within this two-week period.
On February 11, 1852, the U. S. Assay Office received a letter dated January 7 from Secretary Corwin, this time nullifying the December 10 order and again authorizing the striking of $10 and $20 gold pieces. The next day the Alta California ran an announcement to this effect, and in a letter to Corwin, Moffat & Co. principal Curtis stated, “On the same day we made our first five and ten dollar pieces for the United States Assay Office.”
While the press reported three days later the circulation of a United States Assay Office $10 piece, no mention ever was made of a $5 specimen. It is evident that the Assay Office anticipated this permission in 1851, for there is a known $5 pattern dated 1851 that survives today. In addition, $10 and $20 specimens are known which were struck from dies whose dates visibly were altered from “1851” to “1852.” The $20 specimens were issued February 28.
It is during this time that the firm of Moffat & Co. came to an end. An announcement appeared in the Alta California on December 24, 1851, that John L. Moffat had sold out his interest to Curtis, Perry and Ward who still retained the right to use the name of Moffat & Co. On January 7, Curtis wrote to Secretary Corwin on the impending change in the partnership of Moffat & Co. effective February 14, 1852, and requested that Curtis, Perry and Ward be authorized to continue the Government contract. In a revealing paragraph, Curtis explains the reasons for the dissolution of the former partnership:
"From the commencement of the performance of the contract, January last, M. Moffat has employed himself exclusively in other pursuits, and totally neglected every duty at the Assay Office, having been chiefly engaged in Mining."
On February 11, 1852, Curtis received official authority for Curtis, Perry and Ward to continue the Assay Office contract as of February 14, 1852. Hereafter, what had been Moffat & Co. was known as the United States Assay Office of Gold, though the new partnership retained the rights to use the Moffat & Co. name. Prior to the change in ownership, this U. S. Assay Office contractor had coined $10,766,889 worth of gold for the U. S. government, with as much as $2,000,000 worth being struck in one month (approximately $65,000 a day).
The United States Assay Office under Curtis, Perry & Ward (1852-1853)
1852 $10
1852 $50
1853 $10
1853 $20
Immediately following the official dissolution of Moffat & Co. on February 14, 1852, the three remaining partners, Joseph R. Curtis, Philo H. Perry, and Samuel H. Ward, formed the United States Assay Office of Gold, and assumed the government contract to issue gold coins and ingots. Augustus Humbert was instructed by Secretary of the Treasury Corwin to continue in his capacity as U. S. Assayer while working with Curtis, Perry and Ward, while at the same time, Customs Collector T. Butler King was informed by Corwin to accept the coinage of Curtis, Perry and Ward in receipt for custom payments.
Both the Herald and Alta California of February 16 carried announcements of the newly organized firm along with a scale of “reduced rates” for coining ranging from ¾ percent for bullion to 2 ¾ percent for $10 and $20 coins. The new rates, the firm explained, were made possible through “increased facilities.” Although not mentioned in the announcement, these increased facilities were probably a reference to a move to larger offices at 608 Commercial Street.
The spring and summer of 1852 were generally uneventful in the area of private coinage. The new United States Assay Office $10 and $20 issues seemingly met the commercial needs of California. There was, however, a futile request made in April by bankers and merchants to Curtis, Perry and Ward, and from them to Secretary Corwin, for an issuance of $5 coins.
Later that summer, a newspaper revealed that for the most part the United States Assay Office coins were being taken by bankers at par and in some cases being sold in Europe for as much as a ¼ to ½ percent premium. Then in September a new crisis developed. On September 4, 1852, Assistant Secretary of the Treasury William L. Hodge wrote collector King that pursuant to the federal law passed on August 31, his authority to receive coins of the U. S. Assay Office which were under .900 fine was revoked. The effect was virtually to deprive California of all legal currency.
In a revealing article published in the Herald relative to a Congressional speech delivered by California Senator Gwin, the reasons for such a decision became apparent. In his speech, Gwin admitted that not only did he support the new measure, but vigorously fought for its passage. He had become convinced that the only obstacle to passage of the much desired bill for establishing a branch mint in San Francisco was the continued support for the United States Assay Office. The latter, only intended as a temporary measure, was precluding the establishment of a mint in San Francisco officially authorized by Congress on July 3, 1852. By prohibiting receipt of the Assay Office issues, Gwin argued, this would effectively put an end to the quasi-mint.
An additional Congressional complaint against the Assay Office included the loss of American prestige if the Assay Office issues were traded abroad. The thinking was that the Mint Act of January 18, 1837, prescribed the fineness of U. S. gold as 900 parts per thousand fine with no more than 50 parts silver per thousand, and the remainder copper. Since copper was almost nonexistent in California and parting acids for purification very scarce, it was virtually impossible for the California assayers to comply fully with the law.
Instead, the latter issued coins of a natural alloy of silver in varying fineness of 880, 884, or 887 per thousand parts gold. If these coins of less than standard purity entered world commerce, the Congressmen argued, their sub-900 fineness would damage United States prestige. What these Congressmen did not point out, and may not have known, is that Humbert had accordingly increased the weight of the United States Assay Office coins in order that they would be of full mint value, thereby having more gold per coin to compensate for the lesser fineness.
Now the United States Assay Office’s quasi-legal tender status was not even that, as a result of the “.900 fine” amendment appended to the Civil and Diplomatic Bill passed by Congress on August 31, 1852. Its coins no longer were acceptable for payment of custom duties, despite the fact that the intrinsic value of these coins (due to their greater gold content) actually exceeded their face value in many cases.
Even more strangely, this same act which forbade the United States Assay Office issues, accepted foreign gold coins of Mexico, Peru, Chile, Central America, France, Great Britain, Portugal, Spain, and Colombia without regard to their fineness! Collector King was assured, however, that the Treasury Department would try to establish a mint in California as soon as possible. Until then, he would have to abide by the new law.
The obvious effects of such myopic action were published in the National Intelligencer (September 14, 1852):
“Perhaps a more unnecessarily severe and wanton injury has never been committed upon an entire community by the National Legislature, than this enactment, comprised in two lines, has inflicted upon the people of California.”
The paper went on to point out that the value of the Assay Office coins was sustained by their acceptance for custom dues, and that this new law would mean the virtual end to the Assay Office, resulting in great losses to the community. The new branch mint was not scheduled for operation for two years, and the necessity for a circulation currency acceptable for custom dues until that time was quite apparent to the California merchants.
Hodge’s letter to King arrived on October 8 and the entire community was overwhelmed with shock and dismay. The Herald and Alta California called the action “reckless” and “oppressive,” especially considering that there was less than one week’s supply of “acceptable” coin available and the process involved in making .900 fine coins of the proper alloy was extremely difficult and tedious. The United States Assay Office could make .900 fine coins without much greater effort and expense, although including copper might be extremely difficult. The principal problem surrounding the “.900 fine” law was that all previously acceptable gold coin in California circulation at that time suddenly became invalid for custom duties. What would the economy do until an ample supply of newly minted .900 fine gold coins with copper replaced the millions of dollars of invalidated coinage currently in the economy? Even more importantly, what would be done if the newly minted .900 fine coins did not contain the unobtainable copper?
The local merchants held an emergency meeting in the Merchant’s Exchange on October 9 to determine what action they might take to remedy the situation. Collector King was also present and explained that since he was not only collector but also assistant treasurer for California, he was obliged to follow the directive which forbade the Assay Office ingots.
He did, however, propose that if he were relieved of personal responsibility against loss, he would be willing to accept .900 fine coins without the proper admixture of copper. The committee agreed to indemnify King against any loss and soon after the United States Assay Office began striking .900 fine coins acceptable for customs dues. Congress was informed by King of this arrangement, which lasted until the Office closed on December 14, 1853, but took no action against it.
A memo was written to Secretary Corwin outlining that in effect there was now no circulating currency in California, that the price of gold had been as low as $6 to $8 an ounce, that the citizens were forced to pay ½ to 10 percent premium for U. S. coins, and that the refusal to accept Assay Office coins would result in an acute shortage of goods. In addition, the Act of September 30, 1850, they argued, made the ingots of the Assay Office coins of the United States. Furthermore, the merchants argued, the Assay Office had effectively driven out the undervalued private gold issues and had established a fair price for gold in California.
While the citizens of California desired a United States mint, until the time when it was operating some sort of medium was needed which would be accepted by the government for payment of custom dues. In conclusion, the merchants urged the Treasury Department to support Mr. King and allow him to accept the U. S. Assay Office coins after they had been made to conform with the standard fineness of regular United States coins, disregarding the copper content requirement.
Messrs. Curtis, Perry, and Ward were requested by the merchants to prepare and strike coins of .900 fineness for the United States Assay Office. The coiners finally agreed, adding that they thought this might be done in the course of a week. Evidently, the Treasury Department acquiesced to the requests of King and the merchants, for soon after the letter was sent to Corwin, coins of 900 fineness began to appear in circulation. Many were struck from dies which had been altered from 880 thous. to read 900, with later issues being made from melted-down issues of lower fineness.
It also seems that soon after the August 31, 1852, law was passed, Curtis sent Secretary Corwin a letter offering to abandon his company’s contract, believing the law would be disastrous to the company’s interest. But on October 30, realizing that recent events such as King’s acceptance of .900 fine coins still would enable the minter to provide the United States Assay Office coinage at a profit to the Company, Curtis asked to be released from his earlier letter. In accordance with his request, Curtis’s first letter was ignored and Curtis, Perry and Ward continued serving the government contract.
Soon afterwards, the Assay Office obtained machinery for use of their minting that was almost identical to that of the Philadelphia mint. The new capacity enabled them to issue some $360,000 in $10 pieces and $720,000 in $20 pieces per day. This development further enabled the company to reduce its tariff rates as follows:
Per cent
For $20 pieces, under 400 dwts 2
For $20 pieces, from 4000 to 8000 1 ¾
For $20 pieces, over 8000 1 ½
For $10 pieces, under 8000 2 ¼
For $10 pieces, for 8000 and over 2
For melting and assaying into bars 1
For large amounts 0 ¾
It will be apparent on examining the above that the issue of [$50] ingots will for the present cease, as no person would pay the same percentage for coining them (1 ½ per cent the rate) as for $20 pieces. We may, therefore, congratulate ourselves on having soon a circulating medium without any of the objections so long and strenuously urged against the octagons."
These new tariffs, as predicted by Curtis, Perry and Ward, effectively put an end to the issuance of the $50 slugs. Few people would accept the cumbersome fifties at the same rate that they could obtain the much more convenient tens and twenties.
At this same time another severe coin shortage forced the businessmen of San Francisco to appeal again to the U. S. Assay Office of Gold to coin small denomination pieces. The minter was then out of parting acids and the shipments on order were late. Humbert made the decision to have emergency $10 and $20 dies cut imprinted at first with “.880” and then with “.884 THOUS”; an act in total defiance of the August 31, 1852, law. He hesitated as long as possible, and then commenced striking the lower fineness coins from February 23 to March 1, 1853. The new parting acids arrived before too many pieces were struck and immediately the .884 THOUS. pieces on hand were remelted and coined into .900 THOUS. coins. A very few of both the $10 and $20 pieces survive today.
Partner Samuel Ward died in April, and Curtis and Perry may have suspended coining operations soon after. They did make, however, one final issue. Until now, the 1853 MOFFAT & CO. $20 gold pieces have been a mystery since Moffat & Co. had ceased operations in February, 1852. The following announcement appearing in the Herald on July 26, 1853, reveals that in accordance with the dissolution contract, Curtis, Perry and Ward could use the name “Moffat & Co.,” thus explaining who issued 1853 dated coins with the abolished company’s name on them:
CARD – Curtis & Perry, survivors of Curtis, Perry and Ward, having for the present discontinued operations under their contract with the Secretary of the United States Treasury, for Smelting and Assaying Gold in California, announce to the public that they will continue to receive deposits of gold for melting and assaying into bars and ingots on the same terms as heretofore.
Their BARS will be stamped “CURTIS, PERRY & WARD”, “AUGUSTUS HUMBERT, ASSAYER,” together with their weight and fineness. Their issues of TENS and TWENTIES will be stamped on the obverse: “MOFFAT & CO” and on the reverse, “SAN FRANCISCO, CALIFORNIA,” and will be nine hundredths thousands fine. The weight of the former will be 258 grains, and of the latter 516 grains.
The name of the old firm, “Moffat & Co.” is retained in accordance with the articles of dissolution.
Augustus Humbert, Esq., will continue his connection with the establishment, and superintend, as formerly, the Assaying department.
CURTIS & PERRY, SURVIVORS & CO.
There is no present locatable explanation for why Curtis & Perry suddenly would issue private coins in light of the state’s law forbidding it and of their association with the United States Assay Office, which did not seem to terminate until November 1853. The line in their announcement (“Present discontinued operations under their [Assay Office] contract”) does not appear to be verified elsewhere.
Evidently the new coins were released that day, as the Alta California of the same date (July 26, 1853) stated that the coins were “attracting much admiration for their beautiful workmanship.” None of the $10 issues or any of the bars of “CURTIS, PERRY & WARD,” are known ever to have been issued.
In July, Treasury Secretary Corwin suggested to Director of the Mint Snowden that on November 1, 1853, the U. S. Assay Office of Gold should cease operations in preparation for the arrival of the branch mint. Officially, however, the United States Assay Office did not cease operations until December 14, 1853.
Curtis and Perry took that contract to furnish both building and machinery for the new United States Branch Mint. Curtis attended to the expansion of the building and Perry to the making of all arrangements for the machinery. Their offices on Commercial Street near Montgomery were expanded by some twenty feet, and it was there that the San Francisco Branch Mint began operations on April 15, 1854, by striking a number of $20 gold pieces. No plans were made to retain Humbert as assayer, nor did he indicate that he wanted the position. Agoston Haraszthy became the U. S. Mint Assayer, having obtained useful experience with Wass, Molitor & Co., a private minter functioning during the closure of the United States Assay Office and the opening of the United States branch mint.
WAS THE U.S. ASSAY OFFICE A BRANCH MINT?
There is considerable support for the belief that the U. S. Assay Office should be regarded as a provisional branch United States mint. The Act of September 30, 1850, provided for the establishment of an assay office under the supervision of the United States assayer, “Who shall cause the stamp of the United States . . . to be affixed to each bar or ingot of gold.” The assayer was directly responsible to the Secretary of the Treasury, an even higher authority than the Director of the Mint to whom the Superintendents of the Philadelphia, Dahlonega, and Charlotte mints were responsible.
In addition, Humbert used the same form for his monthly reports to the mint director in Philadelphia as did the other branch mint superintendents; these are preserved at the National Archives. In effect, the United States Assay Office seems to qualify at least as a Provisional Mint of the United States Government as it operated in many ways as the four United States Mints did.
USE OF PAPER MONEY
One may wonder why, with such a meager amount of small denomination currency, the state did not resort to issuing paper money, as did the Mormons (see Utah and the Mormons). The California State Legislature wrote into its Constitution that it would “prohibit by law any person or persons, association, company, or corporation from creating paper to circulate as money.”
Quite simply, it was not legal. State issues of paper currency were unconstitutional; private issues of paper currency were outlawed by the California state constitution. But neither was private gold coining legal – at least it certainly was not authorized by the Federal Government. The difference was that the public was prone to accept gold coins, sometimes even those that were debased, whereas there existed a nationwide aversion to paper money, probably arising from the disastrous effect of the 1837 paper money speculation elsewhere in the United States. While some states and their cities issued scrip bearing interest to fund public debts, little private or public currency was issued in the western United States prior to 1858. Vain attempts, however, were made by enterprising companies in California to relieve the dearth of small denomination currency in the West.
Sometime in 1850 the banking house of F. Argenti & Co. planned an issue of $50, $100, $500, and $1,000 notes. No signed notes are known, however.
According to historian Ira B. Cross, on December 31, 1851, the firm of F. Marriott & Co., loan, land, scrip, mining, and money agents in San Francisco, lithographed one thousand $1 and three hundred $5 “cash orders” to be used as currency. The company first claimed that the orders would be redeemed by them and the banking house of B. Davidson, but the latter ran a disclaimer for almost a month cautioning the public against receiving any of the notes.
Practically every newspaper printed editorials against the currency issue citing its unconstitutionality, the possibility of setting a dangerous precedent, and the deceit of Marriott & Co. by its unauthorized use of a banker’s name to sell its currency. It can be seen by this abortive attempt at a paper currency why the experiment was not tried again for several years.