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How Morgan Dollars Became Indian Rupees

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 Posted 01/29/2021  4:28 pm Show Profile   Bookmark this topic Add CCFPress to your friends list Get a Link to this Message
PCGS - Little thought is given by many on the previous incarnations of the metal that the coins they have once were. Yet, truth be told, the metallic content of many coins cannot be traced to their origins if their sources were previously melted coins - with some exceptions. One such exception entails the silver rupee coins from India, where many of the silver issues of George V after 1917 can trace their silver content back to the United States Morgan dollar.

1904 Morgan dollar - PCGS MS67

With the outbreak of World War I, silver coin shortages caused many issues in Europe and other parts of the world. With economies that were dependent on the silver standard, such as the British Colony of India, this was a significant problem. Because of the scarceness of silver, India was having a hard time redeeming its currency for silver upon demand. Nevada Senator Key Pittman introduced the now well-known Pittman Act in 1918, which would allow the United States to loan Great Britain silver bullion from melting United States silver dollars held in Treasury Department vaults. The Pittman Act called for not more than 350,000,000 silver dollars to be converted into bullion and sold to Great Britain at the rate of $1 (plus mint charges) per ounce. With the passage of the Pittman Act, 270,232,722 silver dollars in the Treasury Department vaults in the San Francisco and Philadelphia Mints were melted, with their silver being shipped to Calcutta to be re-coined into India Rupee coins featuring the effigy of King George V.

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 Posted 01/29/2021  7:45 pm  Show Profile   Bookmark this reply Add sel_69l to your friends list Get a Link to this Reply
Up until 1938, all Indian silver coins were made of .917 fine silver, not the slightly poorer standard of .900 fine, as are Morgan dollars.

When the Morgans were melted, a small amount of extra pure silver must have been added to the alloy, to make up to the finer standard of the Rupee.

In 1920, there was a big price spike in spot silver, then a crash followed. It was at this time that British silver coins were reduced to .500 fine, but not so for Indian silver coins.
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