Author Topic: 1864 American 2-cent piece  (Read 1761 times)

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Offline villa66

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1864 American 2-cent piece
« on: April 21, 2011, 11:02:45 AM »
American coins had mostly disappeared from circulation by 1862, driven into hiding by the uncertainty of the Civil War. Even the smallest of the small—the copper-nickel cents—were being hoarded. One temporary solution to the coin shortage was to issue fractional currency (small denomination paper money). Another strategy was to alter the composition and reduce the size of the 1-cent piece in imitation of the privately-issued bronze tokens that had flooded American commercial channels.

Yet another solution to the coin shortage was the addition of a new denomination to the American coin series, the bronze 2-cent piece introduced in 1864.

The 1864-dated pieces are the most common of these coins, and another large mintage followed in 1865.  (It was more than enough, by the end of 1865, for every American to own one.) A look at this first-year example reveals what this short-lived denomination is most famous for—the first appearance on an American coin of the familiar motto “In God We Trust.”

Several versions of the sentiment were considered, among them “God And Country,” and “God Our Trust,” but it was this slightly modified phrase from The Star Spangled Banner that won out (“And let this be our motto, in God is our trust.”)

The impetus behind the addition of the new motto was—as it was for the issue of the new coin itself—the uncertainties and the horrors of the American Civil War. Wars are a hateful thing to be sure, but civil wars are perhaps especially loathsome. And so it was for the United States. The North and South together suffered more military deaths during the war years of 1861-1865 than the U.S. suffered during WWII, and that on an 1860s population of about 30M, compared with the 130M or so during the 1940s.

There had been a lot of cheering and merry-making at the outbreak of the war in 1861, but the cheering soon stopped. By 1864, for many war-weary Americans, “In God We Trust” was more prayer than motto. And then at last, early in 1865, General Grant sat down with General Lee at Appomattox Court House, Virginia, and the Civil War ended.

Production of the 2-cent piece fell off sharply after the war. Silver coins were still in short supply—and would be for about a dozen years more—but with the end of the war the small cents reappeared in circulation. Too, in 1865 America’s second “nickel”—the copper-nickel 3-cent piece—was introduced. And then the new copper-nickel 5-cent piece (America’s third—and current—“nickel”) made its debut in 1866.
 
The need for a 2-cent piece had passed. Production continued to decrease until, after the 1,100 proof-only examples dated 1873, the coin was permanently discontinued. Many were recovered by the authorities, reappearing—after melting and recoining—as Indian Head pennies.

Almost fourteen decades later, and a near miss or two not to the contrary, the 2-cent denomination has never yet been revived for American use.

 :) v.

Offline Figleaf

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Re: 1864 American 2-cent piece
« Reply #1 on: April 21, 2011, 11:55:47 AM »
My first thought was "how would a 2 cents help combat a coin shortage", but after reflection, it does make sense. If you coin at the same speed, a 2 cent piece will put twice as many cents in circulation. Yet, that doesn't solve another question.

I can understand very well why in times of war, you seek refuge to gold and silver, so that precious metal coins disappear from circulation (see this thread). What I find more difficult to grasp is why copper coins disappeared as well. If you argue that the two cents was made to counter a shortage of cents, that means the reason was not the government not issuing the coin, but the public hoarding them. I presume the price of copper had gone up, due to production of bullets and other war material, but the copper market was international, so the price could not have gone up all that much.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

Offline villa66

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Re: 1864 American 2-cent piece
« Reply #2 on: April 21, 2011, 11:07:46 PM »
My first thought was "how would a 2 cents help combat a coin shortage", but after reflection, it does make sense. If you coin at the same speed, a 2 cent piece will put twice as many cents in circulation....
Almost, but not quite. It wasn't a "cent" shortage so much as it was a "coin" shortage. And since one common-sense solution to a coin shortage is to throw coins at it, we see in the years 1864-66 (as mentioned above) the advent of the bronze cent, the bronze 2-cent, the copper-nickel 3-cent, and the copper-nickel 5-cent.

 :) v.

Offline villa66

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Re: 1864 American 2-cent piece
« Reply #3 on: April 21, 2011, 11:27:54 PM »
...I can understand very well why in times of war, you seek refuge to gold and silver, so that precious metal coins disappear from circulation....What I find more difficult to grasp is why copper coins disappeared as well....

This too is sometimes a phenomenon of total war...one episode that comes immediately to mind was the enthusiasm for copper coins shown by individual German visitors to Sweden during WWI.

Remember too that during the American Civil War, the idea of metal as money was still prevalent--so the dynamic would be even more pronounced than in more recent times. And then there is the fact that these weren't bronze cents that had disappeared, but (again, as above) copper-nickel cents, albeit of a very low nickel content.

In the American coin-hobby they have often been called "white cents." I'll post one below so the color difference can be appreciated.

 :) v.

Offline Figleaf

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Re: 1864 American 2-cent piece
« Reply #4 on: April 22, 2011, 12:35:40 AM »
Almost, but not quite. It wasn't a "cent" shortage so much as it was a "coin" shortage. And since one common-sense solution to a coin shortage is to throw coins at it, we see in the years 1864-66 (as mentioned above) the advent of the bronze cent, the bronze 2-cent, the copper-nickel 3-cent, and the copper-nickel 5-cent.

I am not quite convinced yet. The denominations you mention are all at the lowest part of the spectrum. I am sure there was a shortage of higher denominations also, but apparently, the thought was that at least something could be done about the low values. In other words, the action taken points to a different approach for precious metal coins and base metal coins. If so, it would be logical to concentrate on the 5 cents, the highest of the low values. A 2 cents as secondary priority would be logical as well: it fits into a decimal series and see the reason above. Let's leave the three cents out of this. The story I have heard is that the reason for introducing it was to buy 3 cent stamps. If so, the US civil war comes into play only indirectly.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

Offline Ukrainii Pyat

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Re: 1864 American 2-cent piece
« Reply #5 on: April 22, 2011, 01:57:42 AM »
If you have lived in an area of the world where historically there exists a mistrust of paper money you can more easily understand.  For instance in many parts of ex-USSR there is still some mistrust of paper money and some people still prefer to save their money in coinage - like something somewhat tangible that must tug at some basic trait to have a safety net.

During the American Civil War the one unifying consequence for both sides was a serious inflation, of course we all know what happened in the Confederacy - their dollar depreciated until near the end of the war $500 Confederate could not even buy an egg.  But in the Union also there was serious inflation - from all the paper money that the Federal government issued - and a dollar's worth of gold cost much more at varying points in the war.  The US greenback was actually at it's lowest value vs. gold in early 1864 when the Confederacy had racked up several strategic victories early in that year.  The US greenback did not achieve full parity vs. gold and silver until 1878 - so until then the paper dollar traded at a discount vs the same amount in coin.

Subsidiary coins like the cents, nickels, dimes etc did not catch up and takeover again in circulation until the mid 1870's - instead a large amount of low value paper money circulated in the form of Fractional Notes:


These circulated through the 1870's but largely disappeared as the coinage caught up. 

The US Mint tried experimented with various means of creating low value coinage ie, not silver.  One of their neat little projects in 1868 was manufacturing patterns of proposed 10 cent coins in copper nickel that were minted using the hubs for the obverse of the Large cents of the 1850's:


Some of these were also minted in copper - obviously an era when the mint director made coins to order for collectors.

The 2 cent pieces were really not very popular in circulation, but they did circulate until ca. 1900 in dwindling quantities.  I have one in my collection that my grandfather gave me when he was then in his mid 80's - he had gotten it from his brother in 1897 and kept it as a curiousity for nearly 80 years.
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Offline villa66

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Re: 1864 American 2-cent piece
« Reply #6 on: April 22, 2011, 03:10:30 AM »
...Let's leave the three cents out of this. The story I have heard is that the reason for introducing it was to buy 3 cent stamps. If so, the US civil war comes into play only indirectly.

Peter
The 3-cent piece you’re thinking about is the tiny silver coin introduced in 1851. The copper-nickel piece introduced in 1865 is quite a different animal, and very much a product of the Civil War.

 :) v.

Offline villa66

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Re: 1864 American 2-cent piece
« Reply #7 on: April 22, 2011, 03:15:45 AM »
I am not quite convinced yet. The denominations you mention are all at the lowest part of the spectrum. I am sure there was a shortage of higher denominations also, but apparently, the thought was that at least something could be done about the low values. In other words, the action taken points to a different approach for precious metal coins and base metal coins. If so, it would be logical to concentrate on the 5 cents, the highest of the low values....
It’s useful to remember that both the 3-cent and 5-cent (half dime) began the Civil War as silver coins, so the pre-war demarcation between base metal and precious metal actually occurred at the 1-cent/3-cent level.

The U.S. began its issues of “fractional currency” (mentioned in the original post above) at the 3-cent denomination—again as a solution to the war-induced coin shortage. Additional issues of paper currency helped cover the shortages of silver dollars and the several gold denominations, of course.

Shortages of the penny, as mentioned above, were successfully addressed by the replacement of the “white cent” by the “copperhead”-mimicking bronze cent in 1864.

:) v.


Offline villa66

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Re: 1864 American 2-cent piece
« Reply #8 on: April 22, 2011, 03:36:06 AM »
...Subsidiary coins like the cents, nickels, dimes etc did not catch up and takeover again in circulation until the mid 1870's....
True for dimes, quarters and halves; but bronze cents and copper-nickel 5-cent pieces were immediate successes in circulation from about 1864 and 1866, respectively.

Thanks for the great images, scottishmoney, and the good information--particularly about how very long it took the dollar to recover from the Civil War.

About the unpopularity of the 2-cent piece in circulation, I take your point, but do note that I have seen many, many survivors in a most worn and deplorable state of preservation. (How the 2-cent piece in your collection came to be in your possession I think is one of those things that makes coin collecting so fascinating--thanks!)

 :) v.

Offline Ukrainii Pyat

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Re: 1864 American 2-cent piece
« Reply #9 on: April 23, 2011, 11:39:40 PM »
The 2 center I have has a whole story behind it, my grandfather got it as a boy in 1897 - he had lost a pinkie finger in a corn shucker out on the farm.  After he returned home the next day from the doctor - it was about a 10 mile journey, his brother gave him the coin to use when they went into town on a shopping trip soon afterwards.  He was touched that his brother gave him the coin that he had been saving for candy in town - and he kept it for most of the rest of his long lifetime until he gave it to me when I was a little kid.  He lived to be 96 years old.  I still have other coins he gave me, like old silver dollars etc.  But nothing is as precious as that 2 cent piece.  So obviously they were still circulating to some extent then.  My maternal grandmother remembered getting Indian cents and even the flying eagle cents of 1857-8 in change as a girl in the 1930's - but she never saved them - candy was far more important.
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Offline villa66

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Re: 1864 American 2-cent piece
« Reply #10 on: April 24, 2011, 05:03:35 PM »
Would you mind very much if I asked the date of your 2-cent piece?

 :) v.

Offline Ukrainii Pyat

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Re: 1864 American 2-cent piece
« Reply #11 on: April 25, 2011, 12:06:25 AM »
1867.
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Offline villa66

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Re: 1864 American 2-cent piece
« Reply #12 on: April 25, 2011, 05:44:41 AM »
Thanks, scottishmoney, for fleshing out the story of your 1867 2-cent piece. Must be a nice coin just to sit and stare at once in a while.

 ;) v.

Offline villa66

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Re: 1864 American 2-cent piece
« Reply #13 on: December 11, 2012, 06:38:37 AM »
Because of Quant.Geek's post on the American 2-cent piece, I though I'd bring back this old post on the subject.

 :) v.