The Kangaroo Office. Fact Or Fantasy?

To the Forum.

to the CCF!

This Power House Museum piece is interesting.
No date and no source.
Actually looks quite contemporary.
There is a silver version as well.

Scaifes agreement states:
25th June 1853
Whereas the said Reginald Scaife is about to sail to Australia in order to settle himself there as a Merchant And whereas the said Thomas Hodgkin Peter Tindall and William Joseph Taylor are the owners of a stamping press and apparatus for the purpose of assaying and stamping gold and other metals together with dies for stamping the said gold into pieces of specific weight which have been prepared by Thomas Hodgkin Peter Tindall and William Joseph Taylor have proposed to the said Reginald Scaife that he should establish and carry on in Australia the business of purchasing Gold and Gold dust there and smelting and stamping the same by means of said stamping press and apparatus and Dies into pieces of Gold of certain specific weights and then purchasing other Gold and Gold dust by the barter of exchange of those pieces of stamped Gold for other unstamped Gold and Gold dust.....

Scaife is about to leave to become a merchant, that is the initial agreement, and enters into a further (secondary) agreement that involves buying gold, assaying it and turning it into pieces of specific weights, as well as producing other tokens.

It is curious that a few high end collectors want these gold oddities and next thing we know a token, a weight, a memento of an exhibition, the product of a hopeless business model, has become one of the most prized items, if price is our indicator, in Australian numismatics.
Not a pattern, not a coin but in the top echelon of Australian coin collecting; strange.

I am still not sold that these rather nice gold oddities, the Kangaroo Office Issues, deserve to even be considered in a coin catalogue.

The Kangaroo Office narrative from one highly reputable coin dealer goes as follows:
"Towards the end of 1852 Taylor became aware that gold could be bought from diggers on the Ballarat fields at greatly reduced prices .. The Kangaroo Office was under financial pressure right from the outset. By the time the mint was operational gold, which had been £2/15/- (55s) per ounce when the plan was hatched, had moved up to £4/4/- (84s) an ounce. And there was a glut of English sovereigns in circulation."

But how true is this?
The Kangaroo (ship) arrives in the spring of 1853. The plan was 'hatched' in 1852.
The narrative claims:
"Towards the end of 1852 Taylor became aware that gold could be bought from diggers on the Ballarat fields at greatly reduced prices. His plan was to establish a private mint in Melbourne, strike gold coins and release them at their full value in London."

Well before the Kangaroo lifts anchor The London Times reports in Jan 1853:
Victorian gold is fine and pure.N.S.W. gold sells at £3.7.6 (67.5s) oz.Victorian fields at Mt. Alexander, Bendigo and Ballarat yield at £3.10.9 (70.75s) even at Sydney.

Sir Isaac Newton, as master of the U.K. Mint, set the gold price at £3.17s. 10d. (77.8s) per troy ounce in 1717, and it remained effectively the same for two hundred years until 1914.

The Bullion Act of January 1852 set a price for gold in South Australia at 3 pounds 11 shilling (71s), a price that saw gold flowing from Victoria into South Australia.
The Victorian Legislative Assembly was at one point informed that over half a million of gold had been transferred to South Australia to fetch the premium price.
It was estimated at that over £1.6 million pounds worth of gold flowed from Victoria to South Australia between March and December 1852. (Around 14000 kilos)

Scaife, Boss Level at the Kangaroo Office, even states in correspondence:
Such a thing as Gold being bought in Melbourne from Diggers is quite an exception to the general rule, and the amount so purchased are very trifling. It is usual for the Diggers to sell their gold either to a store keeper or the Agents of the Banks at the Diggings and this latter for some time, comparatively become the sole purchasers.
(SA banks had agents in the field at Ballart and Mt Alexander)

The narrative claims a price of 84 shilling per ounce, we must believe that is a price in Melbourne as we are talking about the circumstance of the Kangaroo Office, yet we see gold moving from Victoria to South Australia in 1852/53 to fetch the premium price of 71 shillings set by the Bullion Act.

When was gold ever the 84 shillings claimed in the narrative?
When was it ever the 55 shillings in the time frame we are looking at?

From Jan 1852 gold was 71 shilling in South Australia, from before the Kangaroo Office venture even had momentum. And as we see from UK history the gold price remained very stable for close to 200 years.

At best one was looking at something in the order of 10 shilling per ounce benefit between field price and London price. Could gold be sourced, transported, refined and sold to exploit the differential - not really.
To buy an ounce in the field and refine, assay it and then turn it into weights in Australia may have offered some margin but simply building a shop with a press out back was not going to see that advantage eventuate.

The Kangaroo Office narrative throws around numbers that do not seem consistent with actual prices and events of the times.
Why would anyone send a press to Melbourne in late 1852 when it is well known, even in England, that gold is flowing out of the Victoria colony, literally by the ton?
I think we need to look realistically at the facts and not overly embellish a fringe part of the project.

Yes,Taylors and Co had an agreement, a supplementary agreement, with Scaife to make tokens, some gold, but the idea the Kangaroo Office enterprise was driven by the idea of a profiteering mint to introduce a medium into an almost empty (coin) space is just absurd. Taylor and Co would have to be oblivious to the goings on in Australia if that was indeed their plan and to hatch such a plan with no knowledge of the market is just one for asylum dwellers. One would need to be 'nuts' to think they could send a press to Melbourne and make swags of cash on a differential that did not to exist.

As an aside: The price difference between the Bullion Act and London explain why the South Australian banks were not handing out Adelaide Pounds when colonist sought to redeem their notes for gold.

The press of the day who were at times rather critical of the Bullion Act explains this by stating: "As the banks in this small community absorb all the business transactions, the tokens will either be deposited there by private parties, or will follow the course of the ingots as previously, and be transferred direct from the Assay Office to the banks, who will take care to retain them in their coffers, and to issue sovereigns or silver in payment of their notes. The banks, it may safely be presumed, will not give the public gold tokens, at £3 11s per ounce, as long as they can give them the same article, in the shape of British coin at £3 17s 101d. The direct effect, therefore, of the present measure will be to bring into circulation, more extensively than at present, the coinage of Great Britain, and the tokens will only be met with as 'curiosities'." Containing approximately 135 grains of 22-carat gold the intrinsic value of the "coin-tokens" in South Australia under the Act was £1; whilst in England they were worth £1 is 10.8d. Only four "coin-tokens" were publicly issued in 1852.

Forty thousand pound of coin had arrived from England in December of 1852 so of course the banks were inclined to pay colonist in sovereigns once the Act wound up.

Also, consider the 4 month communication lag between Adelaide and London.
Adelaide notify London of the Bullion Act in late Jan 1852, it is maybe late May by the time London find out what is going on.
In Dec 1852 £40,000 pounds of coin arrives in Adelaide.
That was the response from London and that shipment would have left in late July early August to be in Adelaide on the 9th of December.
Between May, London becoming aware of what South Australia had done and July /Aug when London acted, London organised a problem solving shipment of coin.

It is interesting that on Nov 11 1852 the Bullion Act is amended to make the coin-tokens, as they are called (the Adelaide Pound), legal tender. Seems the Legislative Council didn't know a boat load of cash was just weeks from the dock.

The Assay Office scheme, excuse he pun, pressed the Crown to get its act together and take care of the colony. The Adelaide pound was not so much an act of rebellion but it required rebellion and kudos to all those who chose to rebel as it seems to have saved the colony from bankruptcy.

Considering what went down in Adelaide and what is claimed about the Kangaroo Office it seems we are celebrating a handful of gold tokens from a group of fools, that is if we believe the narrative that alleged reputable sources spread, spread as if it were Vegemite on their morning toast..

Thank you Santa

I would not call them "weights", as "weights" are made of base-metal; you don't make "weights" out of the precious things you're intending to weigh.

If one is reluctant to call them "private patterns", as they are traditionally designated, I would call them "bullion rounds", as they seem to have been intended to serve much the same function as bullion rounds today: readily tradable forms of refined gold.