Money Musings

The Alchemist

Published March 11, 2024 | 5 min read

By Ken Bressett

Enjoy the first column in Ken Bressett’s new “Money Musings” series for free! Full Reading Room access is available to members only. To become a member, click the link below.

Listen to this article
Powered by Pinnacol Assurance

For centuries, the primary goal of the legendary alchemists was to find a way to make gold from base metals such as lead, iron, or copper. The Philosopher’s Stone of the Wise—as their magic potion was called—was said to confer the ability to create gold, prolong life, and cure all diseases. With it, the Elixir of Immortality could be produced for the benefit of humankind. 

With those lofty aspirations in mind, it is no wonder that the ancient pursuit of alchemy has persisted even into modern times—despite continual failure. There once was a single man, however, who came very close by theoretically making his gold coins out of lead. The story of his success and how everyone accepted his coins without hesitation has remained somewhat suppressed, perhaps to prevent it from ever happening again.

Sandino: The Budding Alchemist

This ingenious alchemist was General Augusto César Sandino. He was a revolutionary leader in Nicaragua who led the U.S. Marines on a merry chase up and down the country in 1928 and 1929 in his fight against the conservative government headed by Adolfo Díaz and Emiliano Chamorro. He protested against the U.S. intervention in Nicaragua in 1926 and the 1927 elections. He formed a guerrilla campaign against the occupying Marines sent there to restore order. Far from a minor character, Sandino led a sizable resistance army of jungle fighters equipped with rifles and machine guns. The battle would have continued unabated, but their forces needed financial resources to back their efforts. Then, the inventive General Sandino implemented a plan to make his own gold coins to finance the confrontation. 

As the fighting continued, the army had to be reprovisioned occasionally. They mostly resorted to raiding local stores to acquire what they needed. The general, however, felt obligated to pay for his supplies. To get the needed items, he left the frightened storekeepers with some compensation. After gaining control of the American-owned San Albino gold mines located in the northern part of the country, General Sandino hoped to make some gold coins from that source. Some say that he did, yet no examples are known to exist. What is known is that he removed many of the lead water pipes from the mine and used that base metal to make coins with the molds originally intended for gold coins.

Transmutation by Edict

The Sandino lead coin shown here is inscribed R. DE. N. 10 PESOS ORO (“gold”) on the obverse and INDIOS DE A.C. SANDINO on the reverse. A U.S. Marine colonel obtained it in Nicaragua in 1928. The coin is believed to be one of fewer than six or seven pieces that have survived. At least two different dies were used to make them. The variety shown here, which includes a retrograde dollar sign before the denomination, is unique. These pieces are slightly larger than a U.S. quarter and about three times as thick. All of them are crudely cast, with barely legible inscriptions.

While Sandino may have succeeded in making his lead coins pass for gold, the entire episode ended in tragedy. He made a practice of inspecting the villagers, and if he did not find his money in circulation, he would kill them. If the Marines or the National Guard found people with the coins, they too might kill them as suspected rebels. Sandino sought refuge by scurrying back and forth into and out of Honduras. He was never captured during his six-year battle against the U.S. Marines. He was assassinated in 1934 on orders from Anastasio García, commander of the Nicaragua National Guard, who soon after became one of Latin America’s most notorious dictators.