What is the History Behind the American Silver Eagle?

The American Silver Eagle is a beautiful coin with significant intrinsic and numismatic value. Investors the world over hold these coins in their precious metals portfolios. Coin collectors treasure them for their numismatic value. The Silver Eagle also has a fascinating history.

Why the U.S. Needed a Silver Coin in the Mid-80s
The idea for a silver U.S. coin came about as the answer a question about what to do with excess silver. The U.S. had a large stockpile of silver set aside. Yet, military leaders made it clear during the 1970s that all that silver wouldn’t be needed for defense anytime in the near future. So, Congress had a dilemma: what should be done with the stockpile?

Opposition to Silver Sales
The simplest thing to do would have been to just sell the excess silver as it was. However, there was a problem with that. Flooding the market with silver would cause a drastic drop in silver prices. Mining interests opposed such sales, of course.

Investors who stayed up to date with what was happening to the stockpile became aware that plans were being made to sell off the precious metal. As a result, silver prices started dropping even before the sales could be announced.

Balancing the Budget
The Reagan Administration had an interest in the debate over whether to sell the silver. Reagan was intent on balancing the federal budget. His administration saw the silver stockpile as an asset they could leverage in their quest for a balanced budget. They wanted to sell the stockpile immediately and add the proceeds of the sale to the government coffers.

Silver Sales Ended
Congress complied with Regan’s request and ordered the silver to be sold. In July 1981, they passed legislation to sell off 75% of the stockpiled silver. However, after an auction was announced for October 1981, Idaho silver mining companies, under the leadership of Idaho’s Senator James A. McClure, called for an end to silver sales until 1982.

Congress agreed with McClure and the mining companies. They decided that, at least for the time being, silver sales from the stockpile would be suspended. The President of the United States would determine whether there was too much silver in the stockpile no later than July 1, 1982.

Bill for a Coin
Senator McClure hadn’t forgotten about the National Defense Stockpile when the deadline for determining the fate of the silver approached. In May 1982, Senator McClure introduced a bill that would require the government to sell off the silver in a more advantageous way. McClure’s suggestion was that the silver be minted into coins. This option would give the country the best possible value from the silver without depressing the price of silver on the market.

Congress decided to delay the sale of silver until they could study the situation more. Senator McClure wasn’t finished yet. Instead, he introduced an identical bill again the next year. The bill would require the government to sell any silver it deemed necessary to offload in the form of silver coins. The 1983 bill didn’t pass either, but Senator McClure hadn’t given up. He introduced an amendment to the Statue of Liberty-Ellis Island Commemorative Coin Act two years later. His legislation finally passed, and Reagan signed it into law in 1985.

The Liberty Coin Act
Senator McClure’s amendment became known as the Liberty Coin Act. The act directed the Secretary of the Treasury to mint and issue enough $1 silver bullion coins to satisfy public demand. The act required the silver for the coins to come from the National Defense Stockpile. It also specified the size, weight and design of the coin.

The following specifications were set for the American Silver Eagle coins:
• Silver content: 0.999 troy ounces
• Total weight: 1.000 troy ounces
• Diameter: 1.598 inches
• Thickness: 0.1117 inches

Obverse Design
The obverse design of the American Eagle was to come from a new rendition of Adolph A. Weinman’s Walking Liberty design first used on half dollars in 1916. Walking Liberty is one of the most beloved coin designs in American history. Many consider it the most beautiful design ever used on American coins.
The obverse design features Lady Liberty walking confidently towards the rising sun. The Stars and Stripes are draped over her shoulder, and she carries branches of oak and laurel. The image represents the military and civil strength and glory of the United States. Inscriptions on the coin include “LIBERTY,” “IN GOD WE TRUST,” the year, and engraved in the hem of Liberty’s gown, Weinman’s initials.

Reverse Design
John Mercanti, a U.S. Mint Sculptor and Engraver, designed the reverse design depicting an American Eagle. Specifically, Mercanti’s design is a heraldic eagle design that shows an eagle with wings outstretched. In front of the eagle is a shield. The reverse image of the eagle holding an olive branch and arrows in its talons is reminiscent of the Great Shield of the United States. Thirteen five-pointed stars shine above the eagle and represent the original thirteen colonies. Inscriptions include “UNITED STATES OF AMERICA,” “1 OZ. FINE SILVER-ONE DOLLAR,” and “E PLURIBUS UNUM.” If the coin has a mintmark, it is also shown on the reverse. The bullion coins do not have mintmarks.

The Coin Is Struck!
On October 29, 1986, Secretary of the Treasury James A. Baker III held a striking ceremony at the San Francisco Assay Office to celebrate the striking of the first American Silver Eagle coin. It was a joyous occasion, and Baker enthusiastically suggested that it would be the beginning of a new San Francisco silver rush.

Extending the Program
By 2002, it was clear that the silver stockpile would be depleted soon. To continue with the program, new legislation would have to be passed to allow for purchase of silver from elsewhere. That same year, Senator Harry Reid introduced a bill called the “Support of American Eagle Silver Bullion Program Act.” The bill allowed Congress to purchase silver on the open market for making the Silver Eagle coins. The bill passed and was signed by President Bush on July 23, 2002.

Types of Silver Eagle Coins
Several different types of Silver Eagle coins are produced by the U.S. Mint. These include bullion, proof, uncirculated, special issues, and variants.

The bullion coins were minted at the San Francisco Mint through 1988. The Philadelphia Mint and the West Point Mint took over their production from 1999 to 2000. Later, the San Francisco Mint began producing the bullion coins again, with help from the West Point Mint.

The bullion coins have no mintmarks. They are valuable for the intrinsic worth of their silver content rather than their numismatic worth. However, they are still attractive and desirable coins.

Proof coins, made in relatively small quantities, have more of a more reflective look than a standard coin. They’re made for collectors. Proof Silver Eagle coins were minted in the following locations and with these mintmarks:
• 1986-1992 – San Francisco Mint, bearing “S” mintmark
• 1993-2000 – Philadelphia Mint, bearing “P” mintmark
• 2001-2008 – West Point Mint, bearing “W” mintmark
• 2009 – No Silver Eagle proof coins were minted
• 2010 forward – West Point Mint, bearing “W” mintmark
• 2016-2017 – West Point, San Francisco, and Philadelphia Mints, with “W,” “S,” and “P” mintmarks respectively

The U.S. Mint issued uncirculated Silver Eagle burnished coins. They were struck at the West Point Mint from 2006-2008.

Special Issues
The following special issues included Silver American Eagle coins:
• 1993 – The Philadelphia Set
• 1995 – The 10th Anniversary American Eagle Five Coin Set
• 2000 – United States Millennium Coinage and Currency Set
• 2004 – Legacies of Freedom United States and United Kingdom Silver Bullion Coin Set
• 2006 – Reverse Proof Silver Eagle
• 2006 – 20th Anniversary Gold & Silver Eagle Set
• 2007 and 2008 – Annual Uncirculated Dollar Coin Set
• 2011 – American Eagle 25th Anniversary Silver Coin Set
• 2012 – San Francisco American Silver Eagle Two Coin Proof Set
• 2012 – Making American History Coin and Currency Set
• 2012 – 2012 United States Mint Limited Edition Silver Set
• 2013 – 2013 American Eagle West Point Two-Coin Set
• 2016 – 30th Anniversary Silver Eagles

There are only a few unusual varieties of the Silver American Eagle. The most significant is the 2008-W Silver Eagle Reverse of 2007 Variety, which happened when the reverse design was changed slightly just before 2008 minting. These coins were struck with the old 2007 reverse dies.

Later Developments
Since the Silver Eagle Program began, several factors have impacted it. These include:
• The global recession that took place between the late 2000s and the early 2010s created a dramatic rise in the demand for precious metals coins like the American Silver Eagle. Many investors, wanting a secure hedge against inflation, chose the Silver Eagle.
• What amounted to rationing of the Silver Eagles started in 2008 as the U.S. Mint began to allocate only a limited number of coins to authorized dealers. Some experts suggest this was illegal, since the legislation for the coin required the U.S. Mint to provide enough coins to meet the public demand.

Distribution Then and Now
The Silver American Eagle has been incredibly popular since it was first issued. Strict rules were set up for the distribution of these coins through banks, wholesalers, coin dealers and specified others. Only a few special issues were sold directly to the public.

If you’d like to learn more about the Silver Eagle, our precious metals advisors (https://www.gmrgold.com/) are available to help and offer guidance on this and other precious metals buying decisions. The American Silver Eagle is a great choice for first purchases, regular investment, or for adding to your numismatic collections.