In today’s economy gold is making a big come back. Today’s note is a 1905 $20 Gold Certificate.

An Executive Order that President Roosevelt issued in 1933 called in gold held by U.S. citizens. The Executive Order exempted "gold coins having a recognized special value to collectors of rare and unusual coins," but it did not define special value or collector, and certainly not collectibles.

The order was rationalized on the grounds that hard times had caused "hoarding" of gold, stalling economic growth and making the depression worse. The New York Times, on April 6, 1933 p. 16, wrote under the headline "Hoarding of Gold," "The Executive Order issued by the President yesterday amplifies and particularizes his earlier warnings against hoarding. On March 6, taking advantage of a wartime statute that had not been repealed, he forbade the hoarding 'of gold or silver coin or bullion or currency,' under penalty of $10,000 fine or ten years imprisonment or both."

Although Roosevelt's Executive Order required Americans to turn in their gold coins and gold bullion at a rate of $20.62 per oz., foreigners continued to redeem paper dollars for gold until August 15, 1971, when President Nixon closed the gold window. From the end of World War II to 1971, our gold reserves were cut in half.

It is generally believed that all the gold coins surrendered under Roosevelt's call-in were melted or refined into .999 fine bullion bars. That was not the case. It was to the government's advantage to give the foreigners gold coins of .965 fine gold instead of bullion bars.

Between 1850 and 1907, U.S. mints turned out over 100 million $20 Libertys. Between 1908 and 1933, they coined some 65 million $20 St. Gaudens. Today, no one knows how many have survived, but the number is undoubtedly in the tens of millions, with the bulk of them residing in European bank vaults.

Since 1989, PCGS and NGC, the two major grading services, have "slabbed" over two million coins rated MS-60 or higher. Now, the two services are grading 200,000 to 300,000 coins a month. Millions of lower-grade coins (VF through BU) do not even warrant being submitted.