The California Gold Rush led to the mintage of the $20 Double Eagle gold coin
When a fellow named Samuel Brannan ran up and down the streets of San Francisco shouting “Gold! Gold on the American River!”, little did he know that he would set off the greatest gold rush of the 19th century. However, he certainly did not complain, as he owned the only hardware store stocked with picks, shovels and pans between San Francisco and the newly discovered goldfields.
As gold’s mystical allure has attracted mankind for thousands of years, word of untold riches in the hills and rivers of California set off a frenzy. Men in their hundreds, then thousands and finally in their tens of thousands were arriving in California in any way they could, as this precious metal was once again calling out and stirring men’s craving for quick wealth. The migration of people was so large that San Francisco, which in 1846 was a small settlement of no more than 500 residents, grew into a booming town of about 35,000 by 1852. By 1855, it is estimated that more than 300,000 people from all walks of life, ethnicity and age had arrived in California.
There was certainly gold to be found. It was not unusual for prospectors who had arrived at the outset of the gold rush to find gold worth ten, fifteen and twenty thousand dollars within days, just by using primitive mining tools such as pans and picks. In fact, gold was so abundant that it started to inflate prices of goods and services on the entire West Coast. This was not surprising, as it is estimated that even by 1853, only five years into the Gold Rush, some 373 tons of gold had been found in California’s rivers and streams (worth $15.6 billion at September 2014 prices).
As the gold from Californian began to reach the mints, it quickly became clear that the then legal tender gold coinage, the Quarter Eagle $2.50, the Half Eagle $5 and the Eagle $10, were not sufficient for the amount of gold that was arriving. It was against this backdrop that legislation for the creation of the Double Eagle or the $20 piece was passed by Congress on 3 March 1849. Subsequently, the $20 Double Eagle, containing exactly twice the amount of gold as the $10 Eagle, was issued for the first time in 1850.
$20 Double Eagles stimulated US economic activity
From 1850 to 1933, $20 Double Eagles were minted continuously, as the new, rich gold mines of California were ceaselessly supplying this precious metal to the market. In fact, the increase in the gold supply was the largest and fastest the United States had ever seen. The infused money (gold) had an immense financial impact, serving as an economic multiplier – setting off a chain of reactions, all of which accelerated economic growth.
Food, clothing, hardware supplies, luxuries, and heavy machinery such as steamboats for river traffic, just to name a few items, came into great demand on the West Coast. When a good or a service was in short supply, ambitious migrants hastened to provide it. For example, manufacturing industry sprang to life to produce mining machinery, such as rock-crushers, mining trolleys and drills, steam engines, and dredging machines. To build these machines, lots of iron was needed and so an iron industry was created in northern California. A dozen foundries across the state developed to melt and cast the iron, powder factories were founded, and the lumber industry expanded as wood came into great demand as building material for houses and mines. By 1870, several thousand workers were manufacturing mining equipment in the area surrounding San Francisco.
To feed all the newcomers, the agricultural and food processing industries thrived. Wheatfields with accompanying flour mills, cattle ranches and slaughterhouses, vineyards and wineries became highly profitable businesses. In fact, in 1847, California had no commercial flour mills, but by 1865 more than two hundred flour mills were operating, supplying not only the local market, but exporting significant quantities to Asia, Great Britain, and parts of Europe.
The volume of trade and commerce in all sectors surged. The need for transportation increased and consequently roads, railroads and ports were constructed. Banks and financial institutions were set up to provide financing; in short, the American West boomed. As gold in the form of $20 Double Eagles flowed through the rest of the US economy, it stimulated demand and investments, leading to the establishment of thousands of businesses throughout the country. The $20 Double Eagles would contribute not only to the economy of the United States, since they had a significant impact on global trade as well.
The value of the $20 Double Eagle and world trade
Compared with other gold coins of that time, $20 Double Eagles were massive – containing nearly a full ounce of gold. In fact, they were the world’s most valuable legal tender gold coin, a commanding position retained well into the 20th century. Their large weight and corresponding value clearly had a number of advantages: they were cheaper to produce and easier to transport, and were also favoured as gold reserves by governments and financial institutions.
That being said, $20 worth of gold back then was a lot of money. For example, at the turn of the 19th century the average daily salary for a carpenter was $2.30, whilst a manufacturer in the wool industry received $1.42 a day. As a consequence of their high value, the $20 Double Eagle was precluded from being used for daily transactions; instead, it was primarily used for international commerce and as backing for US dollar certificates (which would be considered today as paper dollars).
Once the San Francisco Mint was established in 1854, Double Eagles were regularly shipped to Europe, Asia and South America in exchange for goods. In this way, millions of $20 Double Eagles ended up in foreign bank vaults, becoming part of their gold reserves. In the aftermath of WWI, a considerable amount of Double Eagles were also sent to war-torn Europe as financial loans for its re-construction. The $20 Double Eagle became a trusted coin that served the global community for almost a century, becoming the most widespread US coin of all time. This trust – leading to its steadfast popularity – was based on the fact that, even though modifications were made to its design, the dimension, size, and metal constitution remained unchanged for more than eight decades.
The $20 Double Eagle design
During the eight decades of its issuance, the $20 Double Eagle coin carried two different designs. Those minted from 1850 to 1907 were embellished with the bust of Lady Liberty and the Great Seal of the United States, whilst the second, markedly different design, artfully conceived by the American sculptor Augustus Saint-Gaudens, appeared from 1907 to 1933.
Liberty Head – 1850 to 1907
The chronicle of the Double Eagles’ design begins with Robert Scot, the first Chief Engraver of the United States Mint. A silversmith by trade, he was known as a great banknote engraver and his work was held in high esteem by leading figures, such as Thomas Jefferson. Scot was responsible for the creation of the original design of the Lady Liberty bust and the Great Seal that appeared for the first time in 1795 on the $5 Liberty Cap Half Eagle gold coin. This design was later modified and applied to the new $20 Liberty Head Double Eagle in 1850.
Until 1907, the framework of this design stayed the same; however, minor tweaks were made that included the way “twenty dollars” was written and the addition of the motto “IN GOD WE TRUST” in 1866. Originally, the design did not carry any reference to God, but following America’s Civil War, it was argued that divine help was needed to heal the scars of this conflict. Therefore, the US Treasury began experimenting with different religious mottos that included “OUR COUNTRY, OUR GOD”, “GOD, OUR TRUST”, and finally IN GOD WE TRUST.
The US gold confiscation and melting of $20 Double Eagles
With the United States in the midst of severe depression, the $20 Double Eagle naturally became the asset of choice. With people seeking to exchange all forms of paper securities, including bank notes, for gold, the financial sector and the Government itself experienced a run on their gold reserves. To prevent this, in 1933 President Franklin D. Roosevelt issued the infamous executive order 6102 that mandated Americans to turn in their gold, receiving paper money in exchange. Gold coins that were stored in private or government vaults at the time of the order were confiscated and subsequently melted down by the US treasury in the coming years – millions of $20 Double Eagles perished this way. The fact that Double Eagles were extensively used in trade was an added benefit, as those coins that were tucked away in overseas vaults could not be seized.
The $20 Liberty Head Double Eagle coin was struck by five different American mints from 1850 to 1907. The mark of the mint (letter) is engraved below the tail of the eagle. Coins struck by the Philadelphia Mint are not marked.
Philadelphia Mint = No mintmark
New Orleans = O
San Francisco = S
Carcon City = CC
Denver = D
The design of the $20 Liberty Head Double Eagle coin stayed essentially the same from 1850 to 1907. However, small changes were made during this period:
From 1850 to 1866 – the coin carries no motto, and the denomination is written “TWENTY D.”
From 1866 to 1876 – the coin carries a motto, and the denomination is written “TWENTY D.”
From 1877 to 1907 – the coin carries a motto, and the denomination is written “TWENTY DOLLARS”
The combined mintage for all three versions of the $20 Liberty Head Double Eagle coin totalled approximately 105 million pieces during this period. The prevailing version we stock is from 1877-1907.