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SS Central America Gold – Valor and ValueSS Central America gold coins have been on the market since March, 2000. Discovered in 1986, the wreck of the SS Central America and its breath taking cargo of gold coins, ingots, nuggets and gold dust attracted a lot of attention – not only in the numismatic press, but in the mass media as well.Small wonder. This is a story with some fascinating angles, including: a tragic maritime disaster with over 400 lives lost, lost gold -- mined in California and sunk in the Atlantic, a role in the Panic of 1857, the historical snapshot – the SS Central America gold wreck is a time capsule. Where to Start?-- With three tons of Gold Rush gold.The SS Central America gold story opens with the California gold discovery of 1848. Moving west had appealed to some in the eastern United States for several decades. But the “Gold Rush” made international headlines that caught the fancy of nearly anyone not fully committed to his current lot in life. Excited would-be gold miners piled in from all over the world. By 1857, increasing production produced a steady flow of gold in various forms to the US East Coast. Gold was shipped down the West Coast to the Isthmus of Panama, offloaded to the railroad at Panama City, then carried to Colon (called Aspinwall by Anglos) on the Caribbean side. There it was moved onto ships sailing for New York and other ports on America’s eastern seaboard. SS Central America was one of a number of ships in regular service from New York to Panama. She was known to be a sound vessel, a side wheel steam ship commanded by a US Naval officer, which was required for any ship carrying US Mail. Captain William Lewis Herndon was an experienced navigator, well known at the time for a recent exploration of the Amazon River. Ship, People, and GoldIn September of 1857 Herndon loaded over three tons of gold at Aspinwall. Included were more than five thousand yet to be circulated twenty dollar gold coins from the recently opened San Francisco Mint. Along with the coins were ingots – cast blocks – of gold from various San Francisco assayers. Each ingot was stamped with values for weight and fineness (purity). One in particular weighed over 80 pounds.The SS Central America gold was accompanied by 578 passengers and crew, and 38,000 pieces of mail. Sailing on September 3rd, the ship called on the port of Havana, then continued up the Atlantic Seaboard on a course for New York. Many ships have been lost in hurricanes off the North Carolina Coast before and since SS Central America’s final voyage -- the area is known as “the Graveyard of the Atlantic.” Soon wind and waves began to build, and what we would call a Force 2 hurricane mauled the ship. SS Central America, a well built, steam powered vessel, also had sails – which, if they held, would help stabilize the ship by heading into the wind. The steam powered paddlewheels could keep the ship moving forward, and all would be well. But it was not to be… Even the small but heavy storm sails were ripped from the rigging by the shrieking wind. The ship heeled over nearly to the point of capsizing. The wheelbarrows used by the engine crew to carry coal from the bunkers to the boilers were useless in the narrow slanting corridors deep inside the hull. Soon the engine was silent, and the paddlewheels ceased to turn. The ship was as helpless as the Spanish treasure galleons of centuries past. It was at this juncture that the captain’s leadership was eloquently manifested. Though the ship did not have lifeboat capacity for everyone aboard – the usual arrangement in those days – Captain Herndon adhered to the tradition of “women and children first.” Firing the ships guns as a signal of distress attracted another ship, the brig Marine, which maneuvered close enough to receive lifeboats. Herndon personally supervised loading the boats, saving 152 people. He was last seen at the helm in his dress uniform, head bowed in prayer, as the ship foundered. Economic Impact – The Panic of 1857The loss of SS Central America gold did not cause the Panic of 1857. But it certainly exacerbated it.The California Gold Rush produced a strong injection of gold to a gold based economy. Commodity prices, based on gold, moved substantially higher. Improvements in mining and ore processing technology in the gold fields increased the flow of gold, which continued to heat the economy. This exuberance resulted in a financial bubble of growing fragility. A recession had been building throughout the year, drawing down the gold reserve of currency issuing banks. (In those days, banks were legally authorized to issue, and back, their own currency.) The cargo of SS Central America gold was equal to one-fifth of all the gold on Wall Street – gold eagerly anticipated by the banks. Although the Panic of 1857 was in retrospect short lived, the sinking was a strong negative to the health of the economy. A New York banker named William Tecumseh Sherman (yes, the future general) put it best when he said, “the absolute loss of this treasure went to swell the confusion and panic of the day." SalvageThe prime mover in the salvage of the SS Central America gold was Thomas G. Thompson, an entrepreneurial scholar with an engineering background. Thompson’s treasure hunting strategy was to target a shipwreck whose cargo was rich enough to attract front money investors, and of significant historic value to drive post-salvage marketing of recovered gold and other artifacts.Thompson also planned to advance the technology of remote recovery. SS Central America gold would satisfy all of these objectives. The search for the wreck was aided by thorough research of contemporary accounts of the sinking – survivor interviews published by newspapers. This produced a store of data that Thompson and his associates modeled to narrow the geographic area to be searched. Meanwhile, the Columbus-America Discovery Group, organized by Thompson to plan and execute the salvage, developed an undersea remotely operated vehicle (ROV) capable of actually recovering the cargo – a step beyond mere observation. Cargo as Time CapsuleThe multiple forms of the SS Central America gold recovered suggest the chaos of mercantile exchange in 1850’s California. Numismatists and coin collectors were dazzled by the treasure coins recovered. And economic historians found the presence of gold in other forms – ingots, nuggets, and dust – especially informative.SS Central America gold shipped to augment banking reserves consisted of coins and ingots. Ingots were found from many of the well known San Francisco assayers, but in sizes hitherto unseen. Gold dust and nuggets were the personal holdings of passengers – and were found scattered throughout the wreckage. Gold in these forms was sacrificed in the last moments, dropped on deck by those hoping to swim clear, in a final bid for survival. The twenty dollar gold pieces, dated 1857-S (San Francisco), were of astonishing quality. But as artifacts of a significant and colorful event, their arrival on the collector market, if anything, stimulated demand for these coins. Coins of gold always command attention. Coins of gold – with an exciting story attached – are of enduring value.
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