# Plunder Economics 101August 10, 2012 9:24 AM   Subscribe

The gold-coin contents of the cliche' pirate/dungeon treasure chest, how much would that be worth today? Assume a stereotypical treasure chest, knee high to an adult, filled with gold escudos in excellent condition. How much would the chest and contents sell for? Could you sell it?
posted by The Whelk to Grab Bag (9 answers total) 4 users marked this as a favorite

Are we talking about the weight of the gold times it's purity, times the going rate on the open market?

Or are we talking about some intrinsic value to having gold escudos?

I suppose a good model would be Mel Fisher's Treasure Find.

The \$450 million dollar treasure cache or "Atocha Mother Lode" would be found on July 20, 1985. Over 40 tons of silver and gold were located including over 100,000 Spanish silver coins known as "Pieces of Eight", gold coins, Columbian emeralds, silver and gold artifacts and over 1000 silver bars.

To frame it in context. Mind these are 1985 prices.
posted by Ruthless Bunny at 9:29 AM on August 10, 2012

Pennies have a packing density of roughly 60%, so let's assume it is full of gold pennies and not escudos.

Just to work with round numbers, let's assume the chest is a cube 30" on the side (people were shorter back then.) That gives you a volume of 27,000 cubic inches. Assuming 60% packing density, you have 16,200 cubic inches of gold. A cubic inch of gold weighs roughly 10.1 troy ounces and the current price of gold is \$1,620/troy ounce. So 16,200 * 10.1 * 1,620 = \$265,064,400
posted by griphus at 9:35 AM on August 10, 2012 [1 favorite]

(Also, I'm sure the chest is worth something, too.)
posted by griphus at 9:40 AM on August 10, 2012 [1 favorite]

There was an episode of Pawn Stars where some dude brought in, essentially, pirate booty.

It was gold, so you had the raw price of the gold.
It was kind of a hand-sized lump melded together by time and water, but you could still make out individual coins, which makes it an interesting piece, rather than just a sack of random coins.
It was from some famous wreck, which brought up the price even more.

I don't remember what their haggling price was, and I don't remember if the dude even ended up selling it. But I do remember that the numbers they were batting around were ridiiiiculously high.
posted by phunniemee at 9:43 AM on August 10, 2012

And I can't find the episode or much description, but I want to say (without watching this to confirm) that it might be this one.
posted by phunniemee at 9:44 AM on August 10, 2012

Genuine escudos are worth far, FAR more than the gold itself. Here's a site selling them for an average of about \$1850 apiece.

Say we use the site griphus linked to, estimate that your treasure chest is half the size of a 55 gallon oil drum, and say that each escudo is (more or less) the size of a penny. That's 150,000 escudos.

Although the sale price listed above is \$1850 each, that's not the price YOU would get for them. You would be selling them to the dealer, who would then turn around and sell them on their website. You can usually expect to get about 50% of the final sale price under that sort of circumstance.

50% of \$1850 = \$925 x 150,000 = \$138,750,000.

However, I notice on that website that each coin comes with a certificate of authenticity. If you can't provide any such information, if your transaction is - shall we say - somewhat on the shady side, then I would knock off another 50%. That would bring your haul to a mere \$69,375,000.
Sidebar: Why wouldn't you just sell the coins online yourself?

Well, you could. But it exposes you to a lot of risk and hassle. You probably also wouldn't get top dollar anyway, because you would be showing up as a random stranger without a history. The kinds of people who buy this sort of high-value collector's item are very leery of being conned. They strongly prefer to buy from dealers they have worked with in the past.

Ancient coin dealers spend years - decades - developing their presence and networks both online and off, not just on their websites but in their physical stores, at numismatic conventions, through articles in trade magazines, etc.

If you decided to sell them yourself, you probably wouldn't be able to get more than 75% of the coin's market value, and you would have to hassle with all the shipping, buyer questions, complaints, insurance issues, etc.
When you approach an ancient coin dealer (a.k.a. fence) with your trunk full of booty, the dealer probably won't have that kind of money up front. And they will want to reduce their own risk, as well as leveraging basic human impatience in their own favor.

Your fence would most likely offer to either buy it all at a reduced price right now (let's say 75% or a lump sum payment of \$52,031,250), or do some negotiating.

For example, the fence might push you to sell them on consignment, where the coins remain your property until they sell, at which point the fence takes their cut. This would mean that you would get a semi-steady stream of income over the terms of the consignment (say six months), and it would mean that the fence wouldn't have to pony up any money up front.

If you refuse to sell on consignment, the fence might counter-offer to split the deal into 4 separate purchases. From the fence's perspective, the sale of the first batch finances their purchase of the next batch.

(How you handle the taxes on this situation would be a whole 'nother Ask, I'm sure.)
posted by ErikaB at 10:28 AM on August 10, 2012 [4 favorites]

Oh, and I wouldn't expect "your" fence to sell all the escudos directly themselves. Most likely they would split the hoard into several smaller batches, and sell a lot of those batches to other dealers. (Or more likely, offer them in trade.)

The shadier the provenance of the escudos, the more likely it is that the fence will dispose of them in a, shall we say, "non-traditional fashion." Knowing that they will have to do this will cause them to knock a chunk of money off their offer to you.

Let's say I'm the fence, and originally I might be planning to offer you \$52m up front for all your coins. But I know it's going to be a huge pain to get rid of them, and I'm going to lose a lot of value on these trades, not to mention the extra hassle. I would probably offer you something like \$40m up front, take it or leave it.
posted by ErikaB at 10:35 AM on August 10, 2012

Regarding selling the items, it matters a lot where the chest is found. Not all jurisdictions would acknowledge the finder's right to such items, moreso if they were not lawfully on the land where it was found. Indeed, they may even be breaking the law by not reporting the find, never mind seeking to sell it. Further if it is pirate's booty, its origin could be identified and the owners seek to regain title. Any finder would be wise to keep the fact that they've found pirate treasure well under wraps, which would stifle attempts to sell it.
posted by Jehan at 12:07 PM on August 10, 2012

Griphus' "16,200 cubic inches of gold" would weigh more than five tons. Just so you know. May I suggest that a real treasure chest would have to be much, much smaller; or much, much emptier?
posted by Joe in Australia at 11:37 PM on August 11, 2012

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