official journal of The Society of Paper Money Collectors Origin & Demise of 1890/91 Treasury Notes SHARE IN OUR SUCCESS Consign today to the Stack’s Bowers Galleries Global Showcase Auction in August 2022 LEGENDARY COLLECTIONS | LEGENDARY RESULTS | A LEGENDARY AUCTION FIRM America’s Oldest and Most Accomplished Rare Coin Auctioneer Contact us today about including your currency in our August 2022 Global Showcase Auction! West Coast: 800.458.4646 East Coast: 800.566.2580 Consign@StacksBowers.com  e Most Valuable United States Paper Money Collection  e Joel R. Anderson Collection for more than $40 Million Winner NLG Best Paper Money Catalog of 2018 and 2019  e Most Valuable U.S. Numismatic Collection  e D. Brent Pogue Collection for more than $140 Million, including Part VI, Masterpieces of U.S. Paper Money which realized over $9 million Winner NLG Best Paper Money Catalog of 2020 Stack’s Bowers Galleries invites you to share in our success when you consign your United States or World currency to our August 2022 auction. Our nearly 90 years of experience and our unsurpassed expertise have resulted in record breaking results and attracted numerous awards.  e robust market, our record of success, and the cutting-edge auction technology developed by Stack’s Bowers Galleries create the perfect environment for you to realize top market price for your currency, across all paper money categories and price levels. Contact us today to consign to our Global Showcase Auction in August 2022! Call 800-458-4646 to speak to a consignment specialist who can help you with all aspects of the process. Email Consign@StacksBowers.com with information about your consignment and receive a con dential reply. 1550 Scenic Avenue, Suite 150, Costa Mesa, CA 92626 • 800.458.4646 • 949.253.0916 470 Park Avenue, New York, NY 10022 • 800.566.2580 • 212.582.2580 1735 Market Street, Suite 130, Philadelphia, PA 19103 • 800.840.1913 • Philly@StacksBowers.com Info@StacksBowers.com • StacksBowers.com California • New York • Philadelphia • New Hampshire • Oklahoma • Hong Kong • Paris SBG CDN_PM AugConsign 220501 178 Origin & Demise of the 1890/91 Treasury Notes--Peter Huntoon SPMC F.U.N. Tentative Activities Merchant, Postmaster & Planter: Like Father, Like Son--Bill Gunther Second Issue Fractional Currency Progress Proofs--Rick Melamed Some Interesting Civil War Monetary Instruments--Steve Feller 193 162 179 184 198 Glass-Borah Amendment--Peter Huntoon 204 National Bank Notes with Women's Signatures--Frank Clark SPMC.org * Paper Money * May/June 2022 * Whole Number 339 157 Columns Advertisers SPMC Hall of Fame The SPMC Hall of Fame recognizes and honors those individuals who have made a lasting contribution to the society over the span of many years.  Charles Affleck Walter Allan Doug Ball Hank Bieciuk Joseph Boling F.C.C. Boyd Michael Crabb Forrest Daniel Martin Delger William Donlon Roger Durand C. John Ferreri Milt Friedberg Robert Friedberg Len Glazer Nathan Gold Nathan Goldstein James Haxby John Herzog Gene Hessler John Hickman William Higgins Ruth Hill Peter Huntoon Don Kelly Lyn Knight Chet Krause Allen Mincho Clifford Mishler Judith Murphy Dean Oakes Chuck O’Donnell Roy Pennell Albert Pick Fred Reed Matt Rothert Herb & Martha Schingoethe Hugh Shull Glenn Smedley Raphael Thian Daniel Valentine Louis Van Belkum George Wait D.C. Wismer Robert Vandevender 159 Benny Bolin 160 Frank Clark 161 From Your President Editor Sez New Members Uncoupled Obsolete Corner Joe Boling & Fred Schwan 213 Robert Gill 219 Cherry Pickers Corner Robert Calderman 222 Quartermaster Corner Chump Change Michael McNeil 225 Loren Gatch 228 Stacks Bowers Galleries IFC Pierre Fricke 157 Fred Bart 183 Bob Laub 183 Lyn Knight 191 Richard Whitmire 192 FCCB 197 Higgins Museum 203 Tony Chibbaro 203 Denly's of Boston 212 Spider Press 212 ANA 218 PCDA IBC Heritage Auctions OBC Fred Schwan Neil Shafer SPMC.org * Paper Money * May/June 2022 * Whole Number 339 158 Officers & Appointees ELECTED OFFICERS PRESIDENT rvpaperman@aol.com VICE-PRES/SEC'Y Robert Calderman gacoins@earthlink.net TREASURER Robert Moon robertmoon@aol.com BOARD OF GOVERNORS Mark Anderson mbamba@aol.com Robert Calderman gacoins@earthlink.net Gary Dobbins g.dobbins@sbcglobal.net Matt Drais stockpicker12@aol.com Mark Drengson markd@step1software.com Pierre Fricke aaaaaaaaaaaapierrefricke@buyvintagemoney.com Loren Gatch lgatch@uco.edu William Litt J. Fred Maples maplesf@comcast.net Cody Regennitter cody.regennitter@gmail.com Wendell Wolka APPOINTEES EDITOR Benny Bolin smcbb@sbcglobal.net ADVERTISING MANAGER Wendell Wolka Purduenut@aol.com LIBRARIAN Jeff Brueggeman jeff@actioncurrency.com MEMBERSHIP DIRECTOR Frank Clark IMMEDIATE PAST PRESIDENT Shawn Hewitt WISMER BOOk PROJECT COORDINATOR Pierre Fricke From Your President Robert Vandevender II From Your President Shawn Hewitt Paper Money * July/August 2020 6 LEGAL COUNSEL Megan Regennitter Megan.regenniter@mwhlawgroup.com Robert Vandevender II Billlitt@aol.com purduenut@aol.com frank_clark@yahoo.com I have some great news for everyone. At our last board meeting, we confirmed our plans to hold the next SPMC annual meeting in conjunction with the upcoming FUN show in January 2023. Planning is underway and we expect to have our annual breakfast, a membership meeting, as well as exhibit grading and award presentations. You will find more information about it in this and future issues of Paper Money magazine. In February, along with VP Robert Calderman, Nancy Purington and I had the opportunity to staff our SPMC Table at the Long Beach Exposition, The Collectibles Show. We had a great time and did sign up some new members and handed out several applications which hopefully will be submitted at a later date. Both Robert and I were able to locate a few new treasures for our collections at this show. What turned out to be a somewhat humorous story was the “case of the counterfeit bill” inquiry. I was with a dealer at the show when a customer arrived and showed the dealer a well worn 1934 $100 Light Green Seal FRN and asked if it was real or a counterfeit. The dealer examined the note and although the “paper” had a slick feel to it after having been either pressed or living in a wallet for years, decided it was in fact a real note. The dealer handed me the note and I examined it using a good magnifying glass and due to the sharpness of the print also agreed that it was a genuine note. The customer finally asked the dealer if he wanted to buy it from him for face value, so the dealer took out five $20 bills and bought the note. The customer then stated that it was a good profit because he had only paid $50 for the note from someone who thought it was a counterfeit. I have purchased postage stamps below face value before, but I have never been able to buy currency in that manner. We all got a laugh out of that one. I was looking through the various and often entertaining posts on Facebook the other day and was interested to see there were several posts about the Web-fed press $1 Federal Reserve Notes. It seems there is a renewed interest in those experimental notes. When the 1988A Series web notes started appearing, several of us became very interested in locating and assembling sets by issued districts, blocks, and plate combinations. Jim Hodgson and I compiled a list of the early printing figures of those notes that was subsequently used in the Standard Guide To Small-Size U.S. Paper Money 1928 To Date by John Schwartz and Scott Lindquist. Later, Bob Kvederas Jr. published a very comprehensive booklet on the subject covering all three series of the notes. I still have an extensive web-fed note collection. I haven’t seen one show up in circulation, or as the Facebook crowd likes to say, “in the wild” for many years. To my knowledge, the very first F-star replacement web-fed note was discovered by my friend Alan Bailey while he and I were searching through packs of singles sitting in my car in Joliet, Illinois. He found two circulated star notes in one pack and was kind enough to give me one of them. We took the notes with us to the Memphis show that year and made quite a splash. At that time, nobody had ever seen one or knew of their existence. On a closing note, I would like to thank SPMC member Peter Robin and his wife Renate for their kind donation of several years of past Paper Money magazines. I would also like to thank Past President Mark Anderson for arranging to pick up the donation. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 159 Terms and Conditions  The Society  of  Paper Money  Collectors  (SPMC)  P.O.   Box 7055,  Gainesville, GA    30504, publishes    PAPER    MONEY (USPS   00‐ 3162)  every  other  month  beginning  in  January.  Periodical  postage  is  paid  at  Hanover,  PA.  Postmaster  send  address  changes  to  Secretary  Robert  Calderman,  Box  7055, Gainesville,  GA  30504. ©Society  of  Paper Money  Collectors, Inc.  2020.  All  rights  reserved.  Reproduction  of  any  article  in whole  or  part  without written approval  is prohibited.  Individual copies of  this  issue of PAPER MONEY are available  from the secretary  for $8  postpaid. Send changes of address, inquiries concerning    non    ‐    delivery    and    requests    for    additional copies of this issue to  the secretary.  MANUSCRIPTS  Manuscripts     not     under      consideration      elsewhere and  publications  for  review should be sent  to  the editor. Accepted  manuscripts  will  be  published  as  soon  as  possible,  however  publication  in  a  specific  issue  cannot  be guaranteed. Opinions  expressed  by  authors  do  not necessarily  reflect those  of  the  SPMC.   Manuscripts should be  submitted  in WORD  format  via  email (smcbb@sbcglobal.net)  or  by  sending memory stick/disk  to  the  editor.  Scans  should  be  grayscale  or  color  JPEGs  at  300 dpi. Color  illustrations may be changed to grayscale at  the  discretion  of  the  editor.  Do  not  send  items  of  value.  Manuscripts are  submitted with copyright release of the author  to  the  editor  for  duplication  and  printing as needed.  ADVERTISING  All advertising on space available basis. Copy/correspondence  should be sent to editor.  All advertising is pay in advance.  Ads are on a “good faith”  basis.  Terms are “Until Forbid.”  Ads  are  Run  of  Press  (ROP)  unless  accepted  on  a  premium  contract basis. Limited premium space/rates available.  To keep rates to a minimum, all advertising must be prepaid  according to the schedule below.  In exceptional cases where  special  artwork  or  additional  production  is  required,  the  advertiser  will be notified  and  billed accordingly.  Rates  are  not commissionable; proofs are not  supplied.  SPMC  does not  endorse any company, dealer,  or  auction  house.  Advertising  Deadline: Subject to space availability, copy must be received  by  the  editor  no  later  than  the  first  day  of  the  month  preceding  the  cover date  of  the  issue  (i.e.  Feb.  1  for  the  March/April  issue). Camera‐ready art or electronic ads  in pdf  format are required.  ADVERTISING RATES  Editor Sez Benny Bolin This issue is late, but FUN times are here again!! First off, I want to apologize to our readers, authors and advertisers for this issue being late. Due to circumstances beyond their control, our printer, Sheridan was hit the first of April by a MAJOR cyberattack that required it to shutter all of its' plants in the U.S. and scrub and essentially rebuild almost all of their computer operations. This has been overwhelming, but they are restoring normal operations as quickly as possible. I know first-hand how difficult this is as our school system was hit and it was a major pain fixing it. But, bad new aside, in more ways than one, fun times are approaching. Shows are back and are in full swing providing that camaraderie we have all been missing for so long due to the global pandemic. Also, as announced in multiple places in this issue, the SPMC, due to the graciousness of the FUN board will be once again starting up our annual activities that were previously held in Memphis and Kansas City. While details are still being ironed out, we are aiming for these to begin again in earnest at Winter FUN, held in Orlando January 5-8, 2023. We hope to keep things pretty much as they were before, with a BOG meeting on Friday, then a presentation later that day. Then, on Saturday morning we bring back our awards breakfast and dust off our Tom Bain raffle with noted emcee Wendell Wolka. This will all be occurring at the Orange County Convention Center in Orlando, Florida in the same North Hall as last year. We are also investigating with the FUN people to do our own paper money exhibit awards as in the past, but even if this is not done, plan on placing an exhibit! In other news, it is time for a board of governor’s election. Yearly, four of our seats are up for election. More information on the process is in this issue. If you are interested in serving on the board, just follow these steps—1. Develop a biography 2. Get the support of 10 member in good standing in the society and 3. Submit these to the secretary by the stated deadline. All current members in good standing with the society are welcomed and encouraged to run for the board. The other upcoming event is voting on-line for our literary awards. This year, they will be for all articles published during the year 2021. We give awards for articles relating to National banknotes, small and large size, Confederate, World and Miscellaneous topics. We also bestow awards for the best book and column. Be thinking now and the list will be out in the summer to vote on. Reward our authors and researchers! Until next issue! Be safe, have fun and love those notes! Required file    submission format    is    composite    PDF v1.3  (Acrobat 4.0   compatible).   If   possible, submitted files should  conform to ISO 15930‐1: 2001 PDF/X‐1a file format standard.  Non‐  standard,  application,  or  native  file  formats  are  not  acceptable. Page  size: must  conform to specified publication  trim  size.  Page  bleed:  must  extend minimum  1/8”  beyond  trim for page head, foot, and front.  Safety margin:  type  and  other  non‐bleed  content must  clear  trim by minimum 1/2”.   Advertising c o p y   shall be restricted to paper currency, allied  numismatic material, publications,   and   related   accessories.    The SPMC  does  not  guarantee advertisements,  but  accepts  copy  in good faith,  reserving  the right  to  reject objectionable  or  inappropriate  material  or  edit      copy.  The          SPMC   assumes      no      financial       responsibility for  typographical  errors  in  ads  but  agrees  to  reprint  that portion of an ad  in  which a typographical error occurs.  Benny Space  Full color covers  1 Time  $1500  3 Times  $2600  6 Times $4900 B&W covers  500  1400  2500 Full page color  500  1500  3000 Full page B&W  360  1000  1800 Half‐page B&W  180  500  900 Quarter‐page B&W  90  250  450 Eighth‐page B&W  45  125  225 SPMC.org * Paper Money * May/June 2022 * Whole Number 339 160 Send dues directly to Robert Moon SPMC Treasurer 104 Chipping Ct Refer to your mailing label for when your dues are due. You may also pay your dues online at www.spmc.org. WELCOME TO OUR NEW MEMBERS! BYFRANK CLARK SPMC MEMBERSHIP DIRECTOR NEW MEMBERS 03/05/2022 15400 David Kranz, Website 15401 Larry Dreyer, Tom Denly 15402 Wesley Thompson, Rbt Calderman 15403 Daniel McKone, Website 15404 Steve Blumberg, Robert Calderman 15405 Frederick Benson, Robert Calderman 15406 Mark Olson, Website 15407 Gary Kalian, Long Beach Show 15408 Bob Jacobs, Q. David Bowers 15409 Douglas Caudle, Robert Calderman 15410 Joe Huber, Paper Money Forum 15411 James R. Barry, Tom Denly 15412 Dennis Buckelew, Robert Calderman 15413 Petru Muraritta, Website REINSTATEMENTS 12802 Patrick Perez, Robert Calderman LIFE MEMBERSHIPS None NEW MEMBERS 04/05/2022 - 15414 David Lewis, Armand Shank 15415 Ed Archer, Frank Clark 15416 Mike Maslanka, PMG 15417 Adam Lemons, Website 15418 Thomas A. Kuss, Fred Reed 15419 Jonathan Baugher, Website 15420 Chris Venner, Frank Clark 15421 Kyle Bentley, C. Regennitter 15422 Henry Morgan, Website 15423 Dave Goldfarb, Website REINSTATEMENTS None LIFE MEMBERSHIPS None The Society of Paper Money Collectors was organized in 1961 and incorporated in 1964 as a non-profit organization under the laws of the District of Columbia. It is affiliated with the ANA. The Annual Meeting of the SPMC is held in June at the International Paper Money Show. Information about the SPMC, including the by- laws and activities can be found at our website-- www.spmc.org. The SPMC does not endorse any dealer, company or auction house. MEMBERSHIP—REGULAR and LIFE. Applicants must be at least 18 years of age and of good moral character. Members of the ANA or other recognized numismatic societies are eligible for membership. Other applicants should be sponsored by an SPMC member or provide suitable references. MEMBERSHIP—JUNIOR. Applicants for Junior membership must be from 12 to 17 years of age and of good moral character. A parent or guardian must sign their application. Junior membership numbers will be preceded by the letter “j” which will be removed upon notification to the secretary that the member has reached 18 years of age. Junior members are not eligible to hold office or vote. DUES—Annual dues are $39. Dues for members in Canada and Mexico are $45. Dues for members in all other countries are $60. Life membership—payable in installments within one year is $800 for U.S.; $900 for Canada and Mexico and $1000 for all other countries. The Society no longer issues annual membership cards but paid- u p members may request one from the membership director with an SASE. Memberships for all members who joined the Society prior to January 2010 are on a calendar year basis with renewals due each December. Memberships for those who joined since January 2010 are on an annual basis beginning and ending the month joined. All renewals are due before the expiration date, which can be found on the label of Paper Money. Renewals may be done via the Society website www.spmc.org or by check/money order sent to the secretary. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 161 The origin and demise of the Treasury Notes of 1890 & 1891 Figure 1. An example of a Series of 1890 Treasury note bearing a small scalloped Treasury seal, the second seal used on the 1890 series, and the spectacular full-pallet ornate back mostly consisting of repetitive geometric lathe work, which characterized the Series of 1890 issues. Heritage Auction archives photo. Abstract The Series of 1890 and 1891 Treasury notes comprise the most curious if not the most interesting issuance of paper money by the Federal government. The notes were fathered by one of the most contentious political issues of the last half of the 19th century, the debate over the role of silver as money. The law that authorized the Treasury notes was the Act of July 14, 1890, known as the Sherman Silver Purchase Act. It was named for John Sherman, influential former Secretary of the Treasury and then Ohio Republican Senator who was serving as Chairman of the Senate Finance Committee. Ironically, Sherman was not an author of the act. It was passed without the support of Republican President Benjamin Harrison. The act was an ill-conceived compromise bill that led to a serious drain on Treasury’s stock of gold. Democratic President Grover Cleveland inherited the mess along with the blossoming of the Panic of 1893 and economic depression that ensued upon taking office in 1893 at the beginning of the second of his detached The Paper Column Peter Huntoon  SPMC.org * Paper Money * May/June 2022 * Whole Number 339 162 terms. He perceived the act to be a primary cause of the panic because it eroded public confidence in the money supply so he gave utmost priority to its repeal despite opposition from his own party. He succeeded in getting the silver purchase provision repealed in the fall of 1893. However, repeal of the reissue provision governing the Treasury notes that were backed by the silver that had been purchased had to await passage of the Gold Standard Act of 1900. Consequently, the Treasury notes authorized by the Sherman Silver Purchase Act were current from 1890 to 1900. The Pulse of the Times In order to fully understand the Sherman Purchase Act of 1890 and the resulting issue of Treasury notes, it is imperative to place the act into the context of its times both economically and politically. A good starting point for our purposes is the Coinage Act of 1837 that allowed for free coinage of silver and gold; that is, the mints would accept all the silver and gold that was brought to them and coin it into money for a seigniorage charge. The act defined the standard content of a silver dollar as containing 0.7734 ounce of silver and established the gold/silver monetary ratio for the United States at 15.987. As a result, the United States valued silver to gold at about 16 to 1 by weight. This undervalued silver relative to gold in relation to the international market at the time. Although the legislation ostensibly was framed to put the nation on a bimetallic monetary standard, gold became the dominate circulating metal going into the Civil War. The Civil War derailed things. The Treasury had insufficient gold to meet its obligations so suspended payments in coin in December 1861, after the outbreak of the war. The Treasury then resorted to the issuance of promissory notes. The first issuances of what is considered to be traditional circulating currency by the United States Treasury consisted of $60,000,000 worth of demand notes authorized by Congress after the start of the Civil War. They were immediately succeeded by legal tender notes that ultimately aggregated $450,000,000 before wars end. The demand notes were redeemable in gold coin but the legal tender notes, so-called greenbacks, were fiat money, which in fact were circulating debt instruments backed by a promise to pay money of unspecified kind at some unspecified date. National bank notes came into existence at the end of 1863. This class of currency was secured by U.S. bonds denominated in legal tender dollars so the notes were redeemable in the fiat legal tender notes. The plentiful legal tender notes and national bank notes were highly inflationary so became sharply discounted against gold. At the low point in late 1864, $1 in greenbacks traded for 38.7 cents in gold. The Treasury plan was to redeem the legal tender notes for gold coin after the war. Until this occurred, the economy operated on the inflated legal tender basis. To this end, Congress passed an act on January 14, 1875 requiring that the Treasury resume specie payments on January 1, 1879, thus forcing parity between gold and the legal tender notes. Two crushing money panics overrode the post-war economy, respectively in 1873 and 1893. Both involved the collapse of railroad investment bubbles in the United States. The 1873 crash rippling from the failure of the venerable Jay Cooke & Company on September 16, 1873, which was overextended in financing the Northern Pacific Railway. The ensuing depression marked by numerous bank failures lasted until 1877. The Panic of 1893 witnessed an oversupply of silver, the collapse of high international commodity prices, especially a crashing of the price of wheat, and collapse of another railroad bubble. The Northern Pacific Railway; Union Pacific Railroad; and Atchison, Topeka & Santa Fe Railroad went into bankruptcy. Some 500 U.S. banks failed as did innumerable companies. Unemployment peaked at 25% in Pennsylvania, 35% in New York, and 43% in Michigan. The depression that followed lasted into 1897 and was the worst experienced by the country prior to the Great Depression. In general, the period between 1873 and 1893 was one of economic stagnation for farmers and laborers characterized by rising production rates and real declines in purchasing power. The deflation was crippling to borrowers. The resulting civil unrest manifested itself in the rise of two leftist populist movements that as they gained adherents and political power strongly influenced the nation’s monetary system. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 163 Figure 2. An example of a Series of 1891 Treasury note with the redesigned open-style back that allowed the holder to see the security threads in the paper. Heritage Auction archives photo. One was the Greenback Movement that agitated between 1874 and 1889. This movement had agrarian roots that attempted to forge an alliance with labor. It was successful enough to field presidential candidates under the Greenback Labor Party label in 1876, 1880 and 1884. Its ideology was anti-monopoly but its primary economic motivation was to inflate the money supply. Proponents perceived that inflation would support higher commodity prices, more equitably spread wealth and allow debtors to pay off their loans with cheapened dollars. They fought the retirement of the Civil War legal tender notes and instead favored more because the greenbacks were inflationary. They opposed the resumption of specie payments, which they viewed as a return to a gold standard and thus deflationary. Resumption was viewed as a ploy whereby reviled eastern bankers would maintain control over most of the gold supply, thereby allowing them to ration out the money at exorbitant interest rates. Both deflation and the constrained money supply worked to the Greenbacker’s disadvantage individually as well as collectively by curtailing the growth of the largely western and southern economies where the movement was the strongest. A Free Silver Movement gained traction in 1873 with much the same ideological leaning as the Greenback Movement. Adherents emerged within both major political parties and some even formed splinter parties. They saw silver rather than greenbacks as the panacea for promoting inflation. They clamored for restoration of free coinage of silver recently lost to them in an 1873 coinage act. Primary promoters of the Free Silver Movement were western miners seeking Federal price support for the 16:1 gold/silver ratio established by Sections 8 through 10 of the Coinage Act of January 18, 1837. Agrarian and labor sympathizers from the Greenback Movement got on board as well as giving the movement needed diversity. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 164 The Greenback Movement died out before 1890 as a non-issue in large part because the Act of July 12, 1882 permitted national bankers to use both gold and silver certificates for their reserves, thus diminishing the need for legal tender notes for that purpose. There was no shortage of either thus removing any potential squeeze on the expansion of national currency owing to the then fixed supply of legal tender notes. In contrast, the Free Silver Movement grained sufficient traction that its adherents took control of the Democratic Party. The party fielded William Jennings Bryant, its most articulate and passionate advocate, as its presidential candidate in 1896, 1900 and 1908. Generally, there was strong sentiment on the part of the key political players in both major parties to move toward a gold standard throughout the 19th century. However, our democratic process bent somewhat to accommodate the noisy and temporarily significant influences of the populist Greenback and Free Silver movements. Their adherents won political seats at all levels of Figure 3. John Sherman, former Secretary of the Treasury under President Rutherford B. Hayes and Republican Senator from Ohio at the time the Sherman Silver Purchase Act was passed in 1890. Ohiomemory.com photo. government up to and including Congress giving them voice. The following are some key milestones on the way to the Sherman Silver Purchase Act of 1890. A huge perturbation occurred when the Act of February 12, 1873, which reorganized the U.S. Mint, was signed into law by Republican President Ulysses S. Grant, himself a strong gold standard advocate. Gold and silver coins were authorized with the same metal contents as the Coinage Act of 1837, except silver dollars were omitted from the list. Suddenly, without silver dollars, western silver miners lost the Treasury as their primary market and the nation was thrust onto a de facto gold standard. The Free Silver Movement was born and as the flames of passion blew into furry, the 1873 law was dubbed the Crime of 1873 because it burdened the farming and working classes with deflation. Sealing their plight was the onset of the Panic of 1873 in September and stubborn depression that followed. Adding fuel to the political fire, Congress passed the Act of January 14, 1875 that required the Treasury to resume specie payment on January 1, 1879, also signed by President Grant. Republican Rutherford Hayes took office in March 1877 and appointed John Sherman Secretary of the Treasury, both pro-gold standard advocates. The House had a Democratic majority; the Senate split 38 Republicans, 37 Democrats and one independent. Democratic Representative Richard P. Bland of Missouri aligned with the silver interests in his chamber and joined with Republican Senator William B. Allison of Iowa to push through the Bland-Allison Coinage Act on February 28, 1878, overriding Hayes’ veto. The act reaffirmed the silver dollar at the 16:1 gold/silver ratio and required the Treasury to purchase between $2,000,000 and $4,000,000 dollars-worth of silver bullion each month and to coin it into standard silver dollars as fast as it was purchased. The dollars SPMC.org * Paper Money * May/June 2022 * Whole Number 339 165 could be deposited in the Treasury as security for issuance of an equal value of silver certificates. This was not a free silver act but it did provide the Silverites with a massive infusion of cheap inflationary currency. Secretary of the Treasury Sherman continued to pursue a policy to redeem the greenbacks but the Greenback faction in Congress took a potent stand against it. On May 31, 1878, Hayes signed a bill pushed through Congress requiring the Secretary of the Treasury to cease redeeming legal tender notes from circulation forthwith and to reissue those that wore out in circulation thereafter. Even Sherman supported the bill (Hepburn, 1924, p. 233). The outstanding greenbacks stood at $346,681,016 when Hayes signed the bill, a number that held until 1964 when some of that amount was written off as irretrievably lost. The legal tender notes were phased out entirely by Congress through an obscure provision signed into law by President Bill Clinton on September 23, 1994. The Act of May 31, 1878 was an important victory for the Greenbackers. Not only had they stopped the redemption of the greenbacks, they also protected the national bank note issues. At the time, the national bank note currency system rested on a legal tender foundation. Elimination of legal tender notes therefore threatened its very existence. When resumption commenced on January 1, 1879, the Treasury had $1 in gold for every $4 of legal tender notes and national bank notes then outstanding. Public confidence in the integrity of the Treasury was good at the time, so runs didn’t materialize on the Treasury. Both the Treasury and Congress wished to assure the public that by law there was gold available if they wished to redeem their legal tender notes. Thus, three and a half years after resumption, a permanent $100,000,000 gold reserve fund was established and earmarked for the redemption of the legal tender notes. This mandate was incorporated into the Act of July 12, 1882, which allowed for the continuation of the national banking system and its legal tender backed currency by allowing corporate extensions for national banks. The gold reserve fund simultaneously strengthened the integrity of national bank notes, which were redeemable in legal tender notes. The $100 million gold reserve certainly was impressive, but there were $346 million in legal tender notes and $360 million in national bank notes outstanding at the time, so only 1 in 7 dollars were covered. The $100 million gold reserve will become crucially important when we get to the Treasury notes in the 1890s. Sherman Silver Purchase Act of July 14, 1890 Agitation persisted for free coinage of silver into Republican President Benjamin Harrison’s term by both farmers desiring inflationary money and western silver interests laboring under overproduction of silver, which was seriously driving down its price. Former Secretary of the Treasury John Sherman, now Republican Senator from Ohio, served as chairman of the Senate Finance Committee and was instrumental in ironing out the differences between the Senate and House versions of a pending silver purchase bill. Ironically, although he was a gold standard advocate, his name was attached to the act when it was signed into law by Republican President Benjamin Harrison on July 14, 1890. See Appendix A for Sherman’s misgivings as the bill was wending its way through Congress. The act repealed the purchase provisions in the Bland-Allison Act and replaced them with the much larger mandate that the Treasury purchase up to 4,500,000 ounces of silver per month if offered at a price not to exceed $1 per ounce. Payment for the silver was to be made with Treasury notes of denominations of between $1 and $1000. Two million ounces of the silver was to be coined into standard silver dollars each month until July 1, 1891, and after that date as much of the silver bullion purchased as necessary to fully cover the outstanding Treasury notes. The act required that the outstanding circulation of the Treasury notes was to be maintained at a level equal to the cost of the silver bullion and silver dollars held by the Treasury that had been purchased by them. The Sherman Silver Purchase Act certainly wasn’t a free silver act allowing for coinage of all silver brought to the Treasury, but it represented a significant increase over the purchases in the Bland-Allison Act. The act contained one serious flaw, included to demonstrate the commitment of the United States to a bimetallic monetary standard that at the time was a 16:1 gold/silver ratio based on $20.67 per ounce SPMC.org * Paper Money * May/June 2022 * Whole Number 339 166 gold and $1.2929 per ounce silver. Section 2 of the act required the Treasury to redeem the Treasury notes in gold or silver at the discretion of the Secretary of the Treasury. The Panic of 1893 was beginning as Democrat Grover Cleveland assumed his second and detached term as president on March 4, 1893. Being the most fiscally conservative Democrat ever to hold the office, he was a staunch supporter of the gold standard. He had two economic priorities upon taking office: dismantle the McKinley Tariff Act of 1890 and repeal the Sherman Free Silver Act of 1890. The McKinley Tariff Act had raised import duties from 38 to 49.5 percent on average, which curtailed trade. Cleveland blamed both acts as primary causes for the panic that was rolling over the country. The gold/silver ratio on the international market was hovering at 20:1 He became particularly alarmed at the rate that gold was being drained from the Treasury, primarily for export. Repeal of the Sherman act became his priority because he felt it was destabilizing public confidence in the nation’s money. On August 8, 1893, he called on Congress to hold a special session Figure 4. President Grover Cleveland, the most conservative Democratic President in history, called a special session of Congress in 1893 to terminate the silver purchase provisions in the Sherman Silver Purchase Act of 1890. Wikipedia photo. to repeal the Silver Purchase Act. The following is a direct quote from his address (Richarson, 1908, v. 9, p, 401-405). You are going to find that Cleveland was not a man known for reeling off pithy concise quotes. Undoubtedly the monthly purchases by the Government of 4,500,000 ounces of silver, enforced under that statute, were regarded by those interested in silver production as a certain guaranty of its increase in price. The result, however, has been entirely different, for immediately following a spasmodic and slight rise the price of silver began to fall after the passage of the act, and has since reached the lowest point ever known. This disappointing result has led to renewed and persistent effort in the direction of free silver coinage. Meanwhile not only are the evil effects of the operation of the present law constantly accumulating, but the result to which its execution must inevitably lead is becoming palpable to all who give the least heed to financial subjects. This law provides that in payment for the 4,500,000 ounces of silver bullion which the Secretary of the Treasury is commanded to purchase monthly there shall be issued Treasury notes redeemable on demand in gold or silver coin, at the discretion of the Secretary of the Treasury, and that said notes may be reissued. It is, however, declared in the act to be “the established policy of the United States to maintain the two metals on a parity with each other upon the present legal ratio or such ratio as may be provided by law.” This declaration so controls the action of the Secretary of the Treasury as to prevent his exercising the discretion nominally vested in him if by such action the parity between gold and silver may be disturbed. Manifestly a SPMC.org * Paper Money * May/June 2022 * Whole Number 339 167 refusal by the Secretary to pay these Treasury notes in gold if demanded would necessarily result in their discredit and depreciation as obligations payable only in silver, and would destroy the parity between the two metals by establishing a discrimination in favor of gold. Up to the 15th day of July, 1893, these notes had been issued in payment of silver-bullion purchases to the amount of more than $147,000,000. While all but a very small quantity of this bullion remains uncoined and without usefulness in the Treasury, many of the notes given in its purchase have been paid in gold. This is illustrated by the statement that between the 1st day of May, 1892, and the 15th day of July, 1893, the notes of this kind issued in payment for silver bullion amounted to a little more than $54,000,000 and that during the same period about $49,000,000 were paid by the Treasury in gold for the redemption of such notes. The policy necessarily adopted of paying these notes in gold has not spared the gold reserve of $100,000,000 long ago set aside by the Government for the redemption of other notes, for this fund has already been subjected to the payment of new obligations amounting to about $150,000,000 on account of silver purchases, and has as a consequence for the first time since its creation been encroached upon. We have thus made the depletion of our gold easy and have tempted other and more appreciative nations to add it to their stock. That the opportunity we have offered has not been neglected is shown by the large amounts of gold which have been recently drawn from our Treasury and exported to increase the financial strength of foreign nations. The excess of exports of gold over its imports for the year ending June 30, 1893, amounted to more than $87,500,000. Between the 1st day of July, 1890, and the 15th day of July, 1893, the gold coin and bullion in our Treasury decreased more than $132,000,000, while during the same period the silver coin and bullion in the Treasury increased more than $147,000,000. Unless Government bonds are to be constantly issued and sold to replenish our exhausted gold, only to be again exhausted, it is apparent that the operation of the silver- purchase law now in force leads in the direction of the entire substitution of silver for the gold in the Government Treasury, and that this must be followed by the payment of all Government obligations in depreciated silver. At this stage gold and silver must part company and the Government must fail in its established policy to maintain the two metals on a parity with each other. Given over to the exclusive use of a currency greatly depreciated according to the standard of the commercial world, we could no longer claim a place among nations of the first class, nor could our Government claim a performance of its obligation, so far as such an obligation has been imposed upon it, to provide for the use of the people the best and safest money. Notice the dilemma the Treasury faced. Speculators were engaged in a merry-go-round of buying silver on the metals market where the price of silver was steadily decreasing, selling it to the Treasury, receiving Treasury notes, redeeming the notes for gold coin, selling the gold coin for ever increasing quantities of silver in the market, pocketing the difference and repeating the cycle. Most of the gold was exported whereas net silver imports increased during 1890 through 1893 (Carlisle, 1894). In due course, the Treasury had to dip into the $100,000,000 gold reserve fund established by the Act of July 12, 1882 to feed this frenzy. The Treasury had to sell gold bonds, mostly overseas, to restock the fund, only to repeat that cycle as well. This simply added to the national debt, which was payable in gold. The situation was unsustainable. Cleveland’s special session of Congress was convened and the purchase requirements in the Sherman Silver Purchase Act were repealed November 1, 1893 by a vote of 239 to 108 in the House and 48-37 in the Senate. Silver purchases ceased forthwith. The silver bullion that had not been coined went into storage alongside the bulky silver dollars the public didn’t want to carry around. Throughout all of this, silver certificates issued against silver dollars held in the Treasury made from silver that has been purchased under the terms of the Bland-Allison Act of 1873 continued to circulate and be replaced when worn out. Aftermath The Treasury held a large stock of bullion from the Sherman Silver Purchase Act. On June 13, 1898 Congress passed the War Revenue Act of 1898 to raise money for the Spanish-American War. Section 34 of that act required that at least $500,000 worth of silver dollars be coined each month from the remaining silver bullion purchased under the Sherman Silver Purchase Act. Those unwanted silver dollars also went into storage and Series of 1899 silver certificates were issued against them, thus providing the Treasury with additional money to help execute the war. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 168 The Sherman Silver Purchase Act providing for the Treasury notes required that when redeemed for coin they had to be reissued in order that their outstanding circulation equaled the cost of the silver bullion and silver dollars held by the Treasury that they had purchased. The Act of 1893 that repealed the purchase requirement in the 1890 act failed to repeal the reissue provision. The result was that the Treasury had to continue reissuing the notes and dealing with erosion of the Treasury’s gold stocks as people redeemed the notes for gold. This cycle was broken with passage of the Gold Standard Act of March 14, 1900. Section 2 of Gold Standard Act affirmed that Treasury notes would be redeemed for gold coin when demanded thus maintaining the integrity of the Treasury’s commitment for such redemption as per the 1890 act, but once redeemed they were to be retired. Section 5 required that the redeemed Treasury notes be replaced dollar for dollar in circulation with silver certificates backed by silver dollars coined under the 1890 act. Gold standard supporters in Congress had to tread lightly as they moved the Gold Standard Act though Congress because the Silverites who favored an inflated currency supply remained a potent constituency in both political parties in 1900. Section 5 was designed to placate them by preventing a contraction of the money supply as Treasury notes were redeemed. That money would be maintained in circulation indefinitely because silver certificates issued in their stead were reissued upon redemption. Treasury notes continued to be redeemed on demand for gold coin until gold was demonetized by the New Deal Treasury. However, some holders requested silver dollars owing to periodic shortages in the availability of small denomination notes. The Sherman Silver Purchase Act of July 14, 1890 served the Silverite’s agenda because it was inflationary and it did augment the supply of currency in circulation. To do so was carried out at a significant Figure 5. Attractive example of a Series of 1890 Treasury note carrying a large spiked seal that was used at the beginning of the series. Smithsonian Institution photo. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 169 Figure 6. Series of 1891 Treasury note with a radar serial number. The portraits on the Treasury notes were a parade of Civil War Union generals and government officials. cost to the Treasury and ultimately the public. Milton Friedman (1994), Nobel Prize winning monetary economist, attributed the defeat of Free Silver presidential candidate William Jennings Bryant’s three campaigns to invention in 1887 of the cyanide leaching process for extracting gold from low-grade ore and old mine and mill tailings. The result was a huge increase in gold production, especially from South Africa, that flooded the world’s markets. The attending inflation-induced economic prosperity helped to spread wealth to Bryant’s political constituency without requiring his intervention. Inflation of the gold supply coopted his silver message! Ultimately the nation did get free silver from Franklin D. Roosevelt’s New Deal Treasury (Huntoon and Yakes, 2012). Table 1 lists the principal legislation governing the issuance of silver backed U.S. currency. Quirks Associated with Redemptions Secretary of the Treasury John G. Carlisle explained in detail how the Treasury had to deal with redemptions after the purchase requirements in the Sherman Silver Purchase Act were suspended by the 1893 act yet the reissue provision applying to the Treasury notes remained operative (NYT, Sep 18, 1894). * * * while the law provides that redeemed Treasury notes may be reissued, it also in that same section imposes an express limitation upon the power to reissue by declaring that “no greater or less amount of such notes shall be outstanding at any time than the cost of the silver bullion and the standard silver dollars coined therefrom then held in the Treasury purchased by such notes.” When such notes are redeemed in gold, there is no obstacle in the way of their reissues, because redemption does not affect the stock of silver held in the Treasury under the act of July 14, 1890. When they are redeemed by silver coined from the bullion purchased under that act, they must be retired and canceled, for otherwise there would be, after the redemption and reissue, a greater amount of notes outstanding than the cost of the silver originally SPMC.org * Paper Money * May/June 2022 * Whole Number 339 170 purchased and then held in the Treasury, and this is expressly prohibited—by the statute. The purpose of Congress was to prevent the duplication of currency, which would be the case if the notes and the silver purchased with the notes could be outstanding at the same time. Treasury notes received in the ordinary course of business, or redeemed in gold or exchanged for silver dollars not coined from the bullion purchased under the act of July 14 1890, are not retired and canceled. All such notes are reissued. Figure 7. I’d take this deuce over any two of the silver dollars minted to back it any day of the week! Heritage Auction archives photo. * * * No Treasury note has been redeemed in silver unless silver was demanded, the policy and practice of the department having always been to redeem in the kind of money demanded by the holder of a note. The presentation of Treasury notes for redemption in silver [dollars] began in August, 1873, when there was a great scarcity of currency of small denominations, and there was redeemed during that month $1,273,267, which was the largest amount that has been presented during any one month. The redemption of Treasury notes for silver dollars is treated in more detail in a subsequent article that also provides the total value of Treasury notes that were issued against the purchase of silver bullion (NYT, Oct 7, 1895). The redemption of the Sherman legal-tender notes in standard silver dollars has been quite a feature of the demand for money of small denominations in the South and West, and has been running recently at the rate of nearly $500,000 a week. This rate of redemption is hardly likely to continue after the demand for money to pay for picking the colon crop is over, but the fact that silver dollars can be obtained for Sherman notes is coming to be understood and acted upon more than in the past. * * * The policy of retiring the notes when redeemed was inaugurated by Secretary Carlisle in the Autumn of 1893. * * * The outstanding Sherman notes have been reduced by the amount of the redemptions in silver, and the original volume of $155,931,002 issued in payment for bullion now stands at $143,426,280. Series Change The change from the Series of 1890 to 1891 backs was brought about by adoption of a new type of security paper supplied to the Bureau of Engraving and Printing from the Crane Paper Company. The new paper had two prominent vertical bands of red and blue fibers. In contrast the paper in use between 1880 and 1891 had two horizontal threads plus small red and blue fibers distributed throughout the paper. The open areas on the left and right sides of the new backs provided windows to allow users to view the vertical bands. The same innovation explains the redesigned backs found on Series of 1891 silver certificates. Conclusion – Reconning on June 30, 1915 An invaluable summary through June 30, 1915, of the grand statistics growing out of the Sherman Silver Purchase Act of July 14, 1890 and the Treasury note issues authorized in it appeared in McAdoo (1915, p. 43). That summary is reproduced here. The authority for the purchase of silver bullion under [the Act of July 14, 1890] was repealed by the act of November 1, 1893, up to which date the Government had purchased 168,674,682.53 fine ounces, at a cost of $155,931,002, for which Treasury notes were issued. The amount of Treasury notes redeemed in gold up to the close of the fiscal year 1915 was $110,712,364 and the amount redeemed in standard silver dollars was $84,556,867. Treasury notes redeemed in standard silver dollars are canceled and retired in accordance with the requirements of the act of 1890. Sections 5 and 8 of the [Gold Standard Act] of March 14, 1900, also provide for the cancellation and retirement of Treasury notes to an amount equal to the coinage of standard silver dollars and subsidiary silver from the bullion purchased with such notes. The cancellation of notes on account of coinage since March 14, 1900, was $69,120,135, so that there remained outstanding June 30, 1915 but $2,254,000. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 171 The big story associated with the Sherman Silver Purchase Act was its drain on Treasury gold and its adverse impact on the national debt (McAdoo, 1915, p. 12-13). This can be viewed through the lens of the Gold Reserve Fund. A bit of history will set the stage. The resumption of specie payments act approved January 14, 1875 directed the Secretary of the Treasury to provide for the redemption of United States notes in coin beginning January 1, 1879, and if necessary to sell bonds in order to purchase gold to redeem those notes from what became the Gold Reserve Fund. The bank act of July 12, 1882 established $100 million as the minimum size of the Gold Reserve Fund, below which it had to be replenished. Over the decades, Congress provided sources of income to support the Gold Reserve Fund. The rate of redemption of United States notes prior to 1893 was not sufficient to reduce the Gold Reserve Fund below $100 million. However, the cyclic redemptions of Treasury notes of 1890 and 1891 for gold seriously chewed into the fund. By April 1893, the minimum was reached and the drain became serious enough that in February 1894 an issue consisting of $50 million worth of 10-year 5 percent bonds was necessary to restore it. This was followed in November by another $50 million in like bonds. These two sales were called the Loan of 1904, which was the maturation date for the bonds. The hemorrhage of gold intensified, so in February 1895 the government purchased 3,500,000 ounces of gold coin, paying for it with 4 percent 30-year bonds amounting to $62,315,400. This was followed by another sale of $100 million more of the 4 percent 30-year bonds in January 1896. These comprised the Loan of 1925. By the time the Loan of 1904 matured, $72 million worth of the bonds already had been rolled over into 2 percent Consols of 1930 and $8.5 million had been redeemed with funds in the Treasury. The remaining Loan of 1904 bonds were redeemed in 1904 using funds in the Treasury. Of the $162 million in the Loan of 1925, $44 million had been redeemed by the Treasury by 1915 leaving $118 million outstanding and payable after February 1, 1925. Thus in 1915, $72 million in public debt was kicked down to 1930 in the form of the Consols of 1930, and $118 million was kicked down to 1925 in the form of the Loan of 1925. Virtually all of this represented gold that had been depleted through the operation of the Sherman Silver Purchase Act. If you are looking for a bright side to this debt, the bonds comprising the Loan of 1925 and the Consols of 1930 were largely purchased by national bankers and used to secure their national bank note issues. You also may well ask, how much of the Loan of 1925 and Consols of 1930 were rolled into bonds with future maturities, ad infinitum. And, we haven’t even considered the interest that was accruing on all this debt as time passed. Sources Carlisle, John G., 1894, Gold and silver in the Treasury of the United States, and circulation of silver & silver certificates (chart with month-end totals including insets for imports and exports of gold and silver, June 1878 through May 1894); in, Annual Report of the Secretary of the Treasury on the state of the finances: Government Printing Office, 992 p. Friedman, Milton, 1994, Money mischief, episodes in monetary history: Harcourt Brace & Company, 286 p. Hepburn, A. Barton, 1924, A history of currency in the United States: MacMillian Co., New York, 575 p. Huntoon, Peter, and Jamie Yakes, Jan-Feb 2012, New Deal changes to the legal tender status of currency: Paper Money, v. 51, p. 7-20, Knox, John J., 1884, United States Notes: Charles Scribner’s Sons, New York, 247 p. Richardson, James W., 1908, A compilation of the messages and papers of the Presidents 1789-1897, vol. IX: Government Printing Office, Washington, DC, 853 p. McAdoo, W. G., Secretary of the Treasury, 1915, Information respecting United States bonds, paper currency and coin, production of precious metals, etc.: U.S. Treasury, Government Printing Office, Washington DC, 106 p. New York Times, May 17, 1890, Sherman’s silver plan, the Senator tells what he likes and dislikes in the pending bill: page 2. New York Times, Sep 18, 1894, Getting rid of the silver, operations of the Administration under the Sherman Act: p. 1. New York Times, Oct 7, 1895, Redemption of Sherman notes: p. 11. United States Statutes, Government Printing Office, Washington, DC. Wikipedia, various web pages. https://www.longtermtrends.net/gold-silver-ratio/ https://ohiomemory.org/digital/collection/p267401coll32/id/8928 SPMC.org * Paper Money * May/June 2022 * Whole Number 339 172 Table 1. Key legislative provisions in Congressional Acts pertaining to the issuance  of notes backed by the purchase of silver bullion by the U.S. Treasury.  Act of February 28, 1878 (Bland‐Allison Act):  Sec. 1: Treasury to purchase not less than $2,000,000 or more than $4,000,000 worth of silver bullion  per month.  Sec. 1: Silver so purchased  is  to be minted  into silver dollars containing 412.5 grains  troy of silver  upon purchase.  Sec. 1: The silver dollars shall be legal tender.  Sec.  3: Silver  certificates of  denominations $10  and higher  corresponding  to  those used  for  legal  tender notes can be issued against a like amount of the silver dollars held by the Treasury for their  redemption.  Sec. 3:  The  silver  certificates  can be used  to  pay  customs  taxes  and all  public dues,  and when  so  received may be reissued.  Yielded:  Series of 1878 $10, $20, $50, $100, $500, $1000 silver certificates  Series of 1880 $10, $20, $50, $100, $500, $1000 silver certificates  Series of 1886 $10, $20 silver certificates  Series of 1891 $10, $20, $50, $100, $1000 silver certificates  Series of 1908 $10 silver certificates  Figure 9. Heritage Auction archives photo. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 173 Act of July 12, 1882:  Sec. 12: Gold certificates and silver certificates authorized to be used as part of the lawful reserve of  national banks.  Sec.  12:  U.S.  Treasury  required  to  hold  a  $100,000,000  gold  reserve  for  the  redemption  of  legal  tender notes  Act of August 4, 1886:  Sec.  1:  Silver  certificates  of  denominations  $1,  $2  and  $5  were  added  to  the  permissible  denominations that could be issued in Sec. 3 of the Act of February 28, 1878.  Yielded:  Series of 1886 $1, $2, $5 silver certificates  Series of 1891 $1, $2, $5 silver certificates  Series of 1896 $1, $2, $5 silver certificates  Series of 1899 $1, $2, $5 silver certificates  Series of 1923 $1, $5 silver certificates  Series of 1928 $1 silver certificates  Act of July 14, 1890 (Sherman Silver Purchase Act):  Sec. 1: Treasury to purchase up to 4,500,000 ounces containing 371.25 grains pure silver per month  if offered at a price not to exceed $1 per ounce.  Sec. 1: Payment for the silver to be made with Treasury notes of denominations of between $1 and  $1000.  Sec. 2: The Treasury notes were redeemable in coin and when so redeemed could be reissued as long  as the value of the outstanding notes equaled the cost of the silver bullion and silver dollars coined  therefore held by the Treasury that was purchased by them.  Sec. 2: Treasury notes were accorded legal tender status and could be held by national banks as part  of their lawful reserve.  Sec.  2:  The  Treasury  shall  redeem  Treasury  notes  in  gold  or  silver  coin  at  the  discretion  of  the  Secretary of the Treasury.  Sec. 3: Two million ounces must be coined into standard silver dollars each month until July 1, 1891,  and after that date as much of the silver bullion purchased as necessary to redeem the Treasury  notes.  Sec. 5: The silver purchase requirements in the Act of February 28, 1878 were repealed.  Sec. 7: The terms of this act are to take effect 30 days from its passage.  Yielded:  Series of 1890 $1, $2, $5, $10, $20, $50, $100, $1000 Treasury notes  Series of 1891 $1, $2, $5, $10, $20, $50, $100, $1000 Treasury notes  Act of November 1, 1893:  Sec. 1: The silver purchase requirements in the Act of July 14, 1890 were repealed.  Act of June 13, 1898 (War Revenue Act of 1898):  Sec.  34:  Required  that  at  least  $500,000  worth  of  silver  dollars  be  coined  each month  from  the  remaining silver bullion purchased under the Act of July 14, 1890.  Yielded:  additional Series of 1899 $1, $2, $5 silver certificates  Act of March 14, 1900 (Gold Standard Act):  Sec. 2: Treasury notes issued under the Act of 1890 are to be redeemed for gold coin and canceled.  Sec. 2: Increased the gold reserve to $150,000,000 to include redemption of Treasury notes  Sec. 5: Silver certificates equal to the value of Treasury notes canceled shall be issued.  Sec. 6: Only 10 percent of outstanding silver certificates can be $20, $50 and $100 notes.  SPMC.org * Paper Money * May/June 2022 * Whole Number 339 174 Yielded:  Significant increase of Series of 1891 $10 silver certificates  Major production of Series of 1899 $1, $2, $5 silver certificates  Series of 1908 $10 silver certificates  Act of April 22, 1918 (Pittman Act):  Sec. 1: Treasury authorized to melt and sell as bullion up to 350,000,000 silver dollars at $1 per ounce.  Sec. 1: An amount of the outstanding silver certificates secured by the melted silver dollars are to  be redeemed.  Sec. 2: The Treasury shall immediately purchase an amount of domestically produced silver at $1 per  ounce equal to that that represented by the silver dollars melted and sold as well as resold for the  purposes specified in Section 3.  Sec. 2: New silver dollars equal in number to those melted shall be coined and silver certificates of  equal value issued against them.  Sec. 3: Sales of silver bullion may be made for:  Conserving the existing stock of gold in the United States,  Settlement in silver of trade balances adverse to the United States,  Silver for subsidiary coinage and commercial use,  Assisting foreign governments at war with the enemies of the United States.  Sec. 5: In order to prevent a contraction of the currency, the Secretary of the Treasury can request  that the Federal Research Board issue Federal reserve bank notes, including $1 and $2 notes, not  exceeding the amount of silver dollars melted and sold as bullion.  Sec. 6: Federal reserve bank notes issued in accord with Section 5 shall be retired when new silver  dollars are coined from the silver authorized to be purchased under the terms of this Act.  Yielded:  Series of 1918 $1, $2, $5, $10, $20, $50 Federal reserve bank notes  Act of May 12, 1933 (Title III of the Agricultural Adjustment Act):  Sec. 43: Accorded legal tender status to silver certificates as follows: “Such notes and all other coins  and currencies heretofore or hereafter coined or issued by or under the authority of the United  States shall be legal tender for all debts public and private.  Sec. 45 (Thomas Amendment): Within six months of passage of this act, The President was authorized  to  accept  silver at 50 cents per ounce  in payment of debts owed the United States by  foreign  governments up to a total of $200,000,000. Silver certificates were to be issued against the silver  received and the silver was coined into silver dollars or subsidiary silver coins sufficient to redeem  the notes.  Yielded:  Series of 1933 $10 silver certificates  Act of June 19, 1934 (Silver Purchase Act of 1934):  Sec. 3: Whenever  the proportion of  silver  in  the monetary stocks of gold and silver of  the United  States is less than one‐quarter of the monetary value of such stocks, the Treasury shall purchase  silver at home or abroad at a price not in excess of its monetary value and no purchases of silver  in the continental United States on May 1, 1934 shall be made at a price in excess of 50 cents per  fine ounce.  Sec. 4: The silver purchased may be sold at home or abroad if the market price of silver exceeds its  monetary value.  Sec. 5: Silver certificates are to be issued and placed in circulation in a face amount not less than the  cost of all silver purchased under the Section 3 to be backed by an amount of bullion and silver  dollars of equivalent monetary value held by the Treasury.  Sec. 5: Silver certificates are to be redeemed for silver dollars.  SPMC.org * Paper Money * May/June 2022 * Whole Number 339 175 Yielded:  Series of 1934 $1, $5, $10 silver certificates  Series of 1935 $1 silver certificates  Series of 1953 $5, $10 silver certificates  Series of 1957 $1 silver certificates  The  terms built  into  acts  passed  June 19, 1934.  July 7, 1939,  July 12, 1943 and  July 31, 1946 adjusted  details on the Treasury’s purchase of silver and dictated the threshold price at which the Treasury would  sell silver. Those thresholds were 50, 71.11, 71.11 and 90.5 cents per ounce respectively. Prior to the late  1950s, production of  silver  usually  exceeded commercial  demand,  so  the Treasury  became  the  largest  purchaser, holder and market‐maker for silver.  Act of June 4, 1963:  Sec.  1:  Repealed all purchase provisions  in  the  various   silver  purchase  acts.  3:  Whenever  the  proportion of silver in the monetary stocks of gold and silver of the United States is less than one‐  quarter of the monetary value of such stocks, the Treasury shall purchase silver at home or abroad  at a price not in excess of its monetary value and no purchases of silver in the continental United  States on May 1, 1934 shall be made at a price in excess of 50 cents per fine ounce.  Act of June 24, 1967:  Sec. 2: Holders of silver certificates given until June 24, 1968 to exchange silver certificates for silver  bullion.  Figure 8. Gold/silver price ratio. The Sherman Silver Purchase Act was passed July 14, 1890. The silver purchase requirement in the Sherman Silver Purchase Act was repealed November 1, 1893. From www.longtermtrends.net/gold-silver-ratio. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 176 Appendix A John Sherman’s Misgivings about the proposed Silver Purchase Act of 1890 (NYT, May 7, 1890) “I do not like some of the features of the bill. I may be driven to support it. * * * If we can agree upon some measure that will furnished to the people of the United States more money, for I think we want it, and will also tend to advance silver bullion nearer and nearer and up to the standard of gold, I am willing to vote for such a measure. But I do not want to embark upon the wide sea of free coinage of silver, and I do not want Congress to pledge itself to buy all of that silver which may be offered— silver melted from the pots of India, China, and all the world. I do not want to vote for any such bill. Let those who would take the risk of such a speculation take it, not I. But anything whatever that can be done by this bill or by any other bill to give us more good paper money, based on actual deposits of gold and silver bullion or that will raise the value of silver, I will favor. I would buy every ounce of silver produced in the country, keep it in the Treasury vaults, and issue certificates upon it, based on its market value, to any extent that may be desired. And I would make them a legal tender, so that they would travel all over the world, be as good as gold, and be on a parity with gold. But this other measure, which has been debated at such voluminous length and with such fulsome eulogy, which invites us into competition with all the world in the free coinage of silver, ‘I do not want any of it in mine.’ To use a slang phrase.” [The Act of July 14, 1890 did not limit the purchase of silver bullion to U.S. production. It gave legal tender status to Treasury notes and placed them on parity with gold.] SPMC Board of Governor’s Election It is time to vote for four expiring seats on the board of governors. All governors are elected on an at-large basis for a three-year term. The governors seats whose seats will be up for election are: Gary Dobbins Matt Draiss Robert Vandevender Mark Drengson Interested parties must be members in good standing in the SPMC and must complete a short biographical sketch suitable to be published in the next issue of the journal as well as submission of written endorsements from 10 members in good standing. These should all be sent to the secretary by June 10, 2022. If enough nominations are sent in to constitute an election, voting will be carried out via the website or by mail from July 1 to July 31, 2022. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 177 SPMC Festivities are Back! Join the SPMC as we resume our normal activities at Winter FUN 2023 Our tentative schedule is as follows Friday, Jan. 6th Paper Money Seminars General Membership meeting Times TBA Saturday Jan. 7th 8a—Breakfast and 2021 Awards. Price of entry includes a newly designed & collectible breakfast ticket 9a-10a—Tom Bain Raffle featuring our jovial and always entertaining Master of Ceremonies— Wendell Wolka Big prizes, surprises, mystery boxes and we will “Mix ‘em Up!” Dates, times, and activities subject to change but make plans NOW to attend Please note that all dates, times, and activities are tentative. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 178 Merchant, Postmaster and Planter: Like Father, Like Son (The Story of Daniel Perry Gunnels of Oxford, Alabama) by Bill Gunther The majority of settlers in Alabama during the early 1800s were small farmers, a fact often dictated by their educational backgrounds and their financial situations. Many came to Alabama hoping to at least improve on their economic situation through the promise of highly productive land. They came from everywhere and by 1850, 70 percent of the state’s population was born some place other than Alabama. Georgia held the top position among all locations but even they only accounted for 7.8 percent of the total population.1 It is therefore a little unusual to find an individual who migrated to Alabama from Georgia AND was a merchant, not a famer. Just such a person was Daniel Perry Gunnels who made the journey in 1845 at the age 22 and ultimately settled in Oxford, Alabama. We were first introduced to Daniel through his scrip which was issued in 1862 from Oxford (see Figure 1). Figure 1. AO-390-$.10a2. Scrip signed D(aniel) P(erry) Gunnels, Oxford, Alabama, September, 1862. 10 cents. The Note This note was issued when Daniel Gunnels was the postmaster of Oxford. It is a plain design with no vignette and only a minor design in both the left and right margins. It states it will pay the bearer 10 cents “in Confederate Currency when the amount of five dollars or its multiple is presented.” This where the note gets more complicated. The left vertical margin states “Received for postage in Oxford,” a statement that strongly suggests that this note is a receipt for payment of 10 cents for postage. However, that interpretation is at odds with the promise on the face of the note to pay the bearer 10 cents in Confederate Currency. A strict interpretation of this wording means a person who paid the postmaster 10 cents could then redeem this “receipt” and collect 10 cents. Why such confused wording? An examination of a note from Bladon Springs, Alabama (Figure 2), also issued by a postmaster may help clear this up. Figure 2. AO-117-$.10b2. Bladon Springs, Alabama. 10 cents. May 1, 1862 The Bladon Springs note contains the vignette of a small train with one passenger car headed to the left. The right margin contains “TEN CENTS”. The left margin, however, contains the wording “Receivable for Postage and Postage Stamps. D. Partridge, P.M.” The word “receivable” means that it can be spent at the post office of Daniel Partridge or it can be redeemed for Confederate funds by the bearer. There is no conflicting wording on the Bladon Springs note. It therefore appears that either the printer or Gunnels himself made the mistake of using the word SPMC.org * Paper Money * May/June 2022 * Whole Number 339 179 “received” rather than the word “receivable” on the Oxford note. Since this is the only Gunnels note to come to public auction, it is not known if the error was discovered and corrected or just left the way it was originally printed. Oxford, Alabama The area that would become Oxford was first occupied by members of the Creek Indian tribe.3 When settlers first began to arrive in the area in the 1830s, they named the settlement “Lick Skillet”, an implied reference to the fact that the residents were so poor that they had to lick their skillets clean to obtain the last morsel of food.4 Later in the 1840s, residents thought better of their name and renamed the town Oxford after the British town. When it was first incorporated in 1852, the town was located in Benton County (1832), named for Thomas Hart Benton, Senator from Missouri. Benton was a planter and slave owner and at that time he was a good friend and ally of John C. Calhoun, Senator from South Carolina. At first, the two shared a common position with regard to slavery and secession, but gradually Benton became disenchanted with slavery and considered it and secession ill-advised. That placed Benton at odds with the residents of Benton County and they voted to rename the county Calhoun County on January 29, 1860. On February 21, 1860 the county was renamed in honor of John C. Calhoun.5 The Gunnels Family The Gunnels family trace their origin back more than five generations to Virginia in the 1600s.6 Nicholas Gunnels (1697-1796), Daniel Perry’s great-great grandfather, was a “minuteman” from Georgia and was recognized for his service with a land bounty of some 287 acres in Georgia. The minutemen were first organized in the mid- 1600s and were members of state militias who were selected because of their training, age and strength, and were ready to deploy at a “minutes’” notice.7 Daniel’s great-grandfather, (also named Daniel), was from North Carolina and a soldier in the “Continental Line” during the Revolutionary War.8 Each Colony was required to contribute a number of soldiers to the Continental Army, and that number was the state’s “line”. The Continental Line was the sum of the 13 colony’s lines. Daniel Perry Gunnels was born on October 6, 1823 near Bold Springs (now a “dead town”), in Franklin County, Georgia to Nathan Daniel and Nancy Gunnels.9 Daniel P. was one of eight children, four boys and four girls of Nathan and Nancy. He was raised on the family farm and received an “adequate education.”10 We believe that in 1840, Daniel’s father was at that time a small farmer. The 1840 Census reveals that Nathan owned only three slaves, all “employed in agriculture,” a number that would hardly be sufficient to run a large farm. Moreover, there is no record of any public land purchases made by Nathan. It seems likely that Nathan grew only food crops for his family’s consumption and perhaps some surplus for trading with local merchants. Daniel, who was age 17 in 1840, probably worked some of the family farm. Sometime after 1840 and before 1850, Daniel’s father, Nathan, made the move to becoming a merchant. The 1850 Census shows that he is now a merchant in Franklin County and now owns no slaves.11 The value of his real estate was estimated at a respectable $6,300, perhaps consistent with both a merchandise store and a home. In 1852, Figure 3 (left)    Thomas H. Benton Source: Wikipedia.com Figure 4 (right) John C. Calhoun Source: Wikipedia.com. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 180 Nathan was appointed postmaster of “Bald” Springs (Bold Springs), a natural extension since the post office was frequently located in the back of a merchandise store. He was reappointed as postmaster in 1866 but only served for about a month when it appears that the post office was discontinued.12 The nearest town to Bold Springs with a post office was Carnesville, about 5 miles to the north-east. In fact, Nathan, who died in early 1870, is buried in the “Gunnels Cemetery No. 1” in Carnesville.13 Thomas J. Caver, Mentor Returning to Daniel Perry, he probably worked with his father until 1845, perhaps as a clerk in his father’s mercantile store. In that year, Daniel relocated to Boiling Springs, Benton County, Alabama (Figure 5) where he obtained a position as a clerk in a mercantile firm owned by another Georgia native, Thomas John Caver.14 Figure 5 “Boiling Springs, Calhoun County, Alabama”. The Caver home was just up the hill to the left. Source: House on the Davis Farm (Caver-Christian House, Boiling Spring) in Oxford, Alabama. https://digital.archives.alabama.gov /digital/collection/photo/id/20712/ Daniel also was able to secure a room in the large Carver home which had just been completed (Figure 6) and having a boarder in their home would not have been a problem. It would also have allowed Thomas Caver to tutor Daniel in the ways of merchandising. Caver reported a real estate value of $8,000 for 1850, which most likely included both his new home and his mercantile store.15 While Caver was also from Georgia (Lincoln County), there does not appear to be a direct connection between the two since Daniel was from Franklin County, and the two counties were some 150 miles apart. Caver’s wife, Eliza Davis, 12 years Thomas’ junior, does not appear to have any connection to Daniel since she was from Alabama.16 Figure 6. Caver home was built between 1840 and 1850. Brick facade was added in 1950 and the home burned in 2006. Source: House on the Davis Farm (Caver- Christian House, Boiling Spring) in Oxford, Alabama, https://digital.archives.alabama.gov /digital/collection/photo/id/20712/ We do know that Daniel Gunnels “…at some time he purchased an interest with his employer, and still later, became the sole owner of the concern”.17 In 1854, Daniel was able to acquire land in Calhoun County, Alabama from the Government Land Office at Lebanon, Alabama in four different transactions. Each transaction involved the purchase of about 40 acres of land, SPMC.org * Paper Money * May/June 2022 * Whole Number 339 181 with the first purchase of 40 acres on July 15 followed by three more 40-acre purchases on October 3, 1854.18 In all four transactions, Thomas J. Caver and Daniel Gunnels are listed on the patent, presumably as partners. However, there is a different third person listed on each of the three different October 3rd purchases. These men, Moses J. Holland, Vincent Meadows, and Matthew M. Moore, could not be positively identified in either the 1850 or 1860 Census records of Benton County, Alabama. Caver did not own any slaves in 1850, but by 1960 his occupation was listed as “farmer” and he had acquired 32 slaves. He most likely planted cotton, perhaps on all four parcels of land that he co-owned.19 At that time, the value of Caver’s real estate had grown to $20,000 and his personal estate to $84,000. Since slaves were considered part of a person’s personal wealth, about half of Caver’s personal estate could have been in the value of slaves. In 1870, Caver’s real estate was still a respectable $16,860 compared to $20,000 in 1860 while his personal estate had fallen from $84,000 to $860!20 Records suggest that Caver sold his mercantile business to Daniel Gunnels, perhaps beginning as early as 1854.21 Daniel moved from Boiling Springs to Oxford around 1854 and continued in the mercantile business in Oxford which he maintained until 1872.22 However, between 1862 and 1865 he was employed by the Oxford Iron Company, a “reserved occupation” that would have exempted him from military service in the Confederate Army.23 The Oxford Iron Company (also called Oxford Furnace Co.) was organized November 1862 and mined iron ore and manufactured pig iron for the war effort. Unfortunately, Oxford Furnace was burned by Federal troops April 23, 1865, exactly two weeks after Lee surrendered on April 9th.24 At some point, Daniel Gunnels had sold part of his land holdings in Calhoun County to his employer, the Oxford Iron Company. In 1872, Samuel Noble and Daniel Tyler, purchased the ruins of the Oxford Iron Company and rebuilt the company as the Woodstock Furnace Company. The company laid out the area around the new plant as a company town and founded the town of Anniston in 1873. It was not open to general settlement until 1883.25 In 2020, Anniston and Oxford were approximately of equal population size (23,106 and 21,348 respectively).26 The towns are less than 5 miles apart. In 1857, Daniel married Susan Elizabeth Cunningham in Talladega. She was born in Alabama and was just 18 years old, while Daniel was 33, some fifteen years her senior!27 This is a family tradition it seems, when you consider that Susan’s mother, Nancy, was 16 years younger than her husband, William!28 Daniel and Susan Elizabeth began to grow their family of eight children starting in 1859, and produced four boys and four girls by 1876. The 1860 Census shows Daniel’s occupation to be that of a merchant and the value of his real estate was $2,000 and his personal estate was $12,000. By 1870, Daniel’s real estate had increased from $2,000 to $10,000 while his personal estate had fallen to $5,000. Since Daniel did not own any slaves, it is not clear what part of his personal estate had taken such a large drop in value. There is no further record of Daniel’s financial picture in any of the Census records. On July 2, 1858, Daniel continued to follow in his father’s footsteps by becoming the postmaster of Oxford, a position he held until October 18, 1865. His younger brother, Joel D. Gunnels, became the postmaster of Banksville, Georgia in 1870 and held that position until April of 1875 when his even younger brother, John H. Gunnels was appointed postmaster of Banksville. An incredible sequence where father and three sons all became postmasters.29 A fourth son, Nathan C., migrated to Palestine, Texas where he joined the 37th Texas Calvary, Confederate States, on May 8, 1863. He died in Texas on November 30, 1864 as a 1st Lieutenant.30 It is unclear if his death was related to his service in the army. Daniel died in 1895 at the age of 72 and Susan died in 1923 at the age of 84. Both are buried in Oxford, Alabama.31 The Gunnels name lives on in the city of Oxford with two roads bearing the family name: Gunnels Lane and Gunnels Street. And of course, Anniston is founded on land once owned by Daniel Gunnels. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 182 References 1 Gregory, James, “America’s Great Migrations,” https://depts.washington.edu/moving1/Alabama.shtml 2Gunther, William and Charles Derby, A Comprehensive Guide to Alabama Obsolete Notes: 1818-1885, Privately Printed, 2020. 3Maloney, Christopher, “Oxford”, Encyclopedia of Alabama, https://encyclopediaofalabama.org. 4Foscue, Virginia O., Place Names in Alabama (Tuscaloosa: University of Alabama Press, 1989), p.106 5“Calhoun County, Alabama”, https://en.Wikipedia.org/wiki/Calhoun_County,_Alabama#History 6,9,27“Gunnels, Daniel Perry,” Public Family Trees, Ancestry.com 7”Minutemen,” Wikipedia.com. (https:/en.wikipedia.org/wiki/minutemen) 8Gunnels, Sallie Francis, North America Family Histories, 1500-2000, Ancestrry.com. 10Gunnels, Nathan. Find-a-grave. Ancestry.com. 11Gunnels, Nathan. 1850 Census and Census of Slaves 12Gunnel, Daniel and Nathan Gunnels, U.S. Appointment of U.S. Postmasters, 1832-1971, Ancestry.com 13Gunnels, Nathan. Find-a-grave, Ancestry.com. 14,17,21,22”Gunnels, Daniel,” U.S. Surname Files Expanded, 1702-1981, Ancestry.com 15,19,20”Caver, T. J.”, Census of 1850, 1860 and 1870. Ancestry.com. 16”Eliza Davis Caver”, Find-a-grave, Ancestry.com 18”Gunnels, D. P.”, U. S. General Land Office Records, 1776-2015, Ancesstry.com 23”Confederate Conscription Acts: 1862-1864.” https:/en.wikipedia.org/wiki/Confederate_Conscription_Acts_1862_1864. The 1862 Act applied to men 18 to 35. Daniel Gunnels was 37 at the beginning of the war in April of 1861, but would have been 38 on his birthday in October 1863 and subject to the Second Conscription Act which extended the range from 18-45. 24“Historic Oxford,” Alabama Historical Markers, ahc.alabama.gov/historicalmarkerprogram.aspx 25 “History of Anniston, Alabama”. www.u-s-history.com. 26Anniston and Oxford, Alabama. Population estimates are from Wikipedia.com. 28”William Cunningham,” Census of 1850, Ancestry.com. 29U.S. Appointment of U.S. Postmasters, Ancestry.com. 30Gunnels, Nathan C., Find-a-grave, Ancestry.com. 31Gunnels, Susan, Find-a-grave, Ancestry.com. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 183 Some Interesting Civil War Monetary Instruments by Steve Feller Currency notes are my modal collectable, however, as I have collected for many years, ancillary numismatic items, related to my interests, have been swept into my collection. In many ways these are as interesting as the notes themselves. Here is a small sampling of some very historical items from the Civil War period of 1861-1865. A. Treasury Warrants for the Confederate States 1. 1862 (Figure 1 - below) This treasury warrant for $207.75 is dated March 24, 1862 and is from New Orleans twice (Figure 1-above). It was printed in New Orleans and it was issued there as well. Several prominent Confederates signed this fiscal document including Robert Tyler, eldest son of US President John Tyler and Register of the Treasury, Edward C. Elmore, Treasurer of the Confederate States; these signatories also signed Confederate Notes printed by the Southern Bank Note Company in 1861. Assistant Treasurer Anthony Guirot wrote vertically on the face that the note was cancelled in Mobile On October 27, 1863. The note was payable to H. A. Burton. On the back (Figure 2-left) two names appear. H. A. Burton endorsed the note and Joseph W. Hickey received the note for payment on that same day, also in Mobile. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 184 2. 1865. Figure 3. Dated March 7, 1865 this is a very late CSA Warrant for $750. John Hendren signed this warrant just over a month before the surrender at Appomatox Courth House, VA. as the second and last Treasurer of the Confederate States. According to Wikipedia: John N. Hendren (1822 — 1898) had been a Virginia attorney and judge who served as the second treasurer of the Confedferate States of America…Hendren was born in Staunton, Virginia. He was the nephew of locally prominent Presbyterian minister John Hendren. He attended The College of William and Mary, studied law, passed his bar exam, and established a prosperous legal practice in Staunton. He married, raised a family, and built a large mansion, "Selma." Secretary of the Treasury Christopher Memminger resigned his post on July 18, 1864, and was replaced by fellow South Carolinian George Trenholm. However, Edward C. Elmore initially stayed on as Treasurer under Trenholm, but resigned in the autumn. Shortly afterward, Hendren posted his bond on October 10, 1864, and assumed the role of Treasurer. He stayed in his post until the fall of the Confederacy in April 1865. Following the war, Hendren returned to Staunton and was a judge for Augusta County, Virginia. Noted Confederate research Phillip Lamb relayed to me that he knew of just two of these warrants signed by Hendren. His description of these two was: “genuine treasures.” He went on to note that both vouchers were issued in Abbeville, SC. The other one was for 1.3 million dollars! Robert Tyler also signed this warrant as Register of the Confederacy.. Figure 4. Abbeville, S.C. is the location given on the note. Abbeville was both the birthplace of secession and the site of the end of the Confederate cabinet and government. On November 22, 1860, a meeting was held at Secession Hill in Abbeville (Figure 5) to plan agitation for South Carolina's secession from the Union; one month later, on December 20, 1860 the state of South Carolina did, in fact, formally secede. It was the first state to do so. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 185 Figure 5. Secession Hill in Abbeville, SC. https://en.wikipedia.org/wiki/Abbeville,_South_Carolina#/media/File:Rock_at_Secession_Hill.jpg Confederate President Jefferson Davis held the last cabinet meeting in Abbeville at the home of his friend Armistead Burt. It was there on May 2, 1865, in the front parlor of the Burt-Stark Mansion (Figure 6) that Jefferson Davis officially acknowledged the end of the Confederate government. This was a full month after the fall of Richmond Figure 6. Burt-Stark House, Abbeville, SC https://upload.wikimedia.org/ wikipedia/commons/8/89/Burt- Stark_house.jpg SPMC.org * Paper Money * May/June 2022 * Whole Number 339 186 B. 1864 State of Ohio Warrant for “Repelling Invasion.” There were two large scale invasions of the North by General Robert E. Lee. Both led to serious Confederate losses; one at Antietam, MD in 1862 and one at Gettysburg, PA in 1863. However, there were several other incursions including the well-known raid by General John Morgan into Indiana and Ohio (Figure 8). General Morgan sought to supply his troops and disrupt the Union at a crucial time—the battles of Vicksburg and Gettysburg were raging during the raid. Ultimately the raid did not succeed. Nearly three thousand Confederates participated and many were captured or died. The state of Ohio paid out more than $200,000 in wages to the defenders of the state. Figure 7 shows a treasury warrant for $10.80 that was from the “Military Fund” of the State of Ohio. This document is a tangible part of that state payment and is a true piece of history. Figure 7. Payment to an Ohio soldier repelling Morgan’s Raid into Indiana and Ohio. Figure 8. Path of the Morgan Raid. It went over 1,000 miles. https://en.wikipedia.org/wiki/Morgan%27s_Raid SPMC.org * Paper Money * May/June 2022 * Whole Number 339 187 C. A Check from the South and a Check from the North Figure 9. Confederate Treasury check for $19,500 Major Claibourne, of the Confederate States wrote the illustrated Confederate States check for $19,500 on Saturday the 4th of January 1862 (Figure 9). At that time Confederate currency still maintained most of its value in gold (approximately 0.75 to 0.80 $ in gold according to SUPPRESSING ASSET PRICE INFLATION: THE CONFEDERATE EXPERIENCE, 1861-1865by Richard C.K. Burdekin Marc D. Weidenmier Working Paper 9230 http://www.nber.org/papers/w9230 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138 October 2002) and this check was quite a lot of money. I do not know what it was used for—perhaps to obtain supplies for his regiment as it was written to a commercial firm. Figure 10. The Cooper Shop Volunteer Refreshment Saloon served Union troops passing through Philadelphia. This is a check receipt from it for $34.62. The flag has 34 stars indicative of the admission of Kansas on July 4, 1861. Note that the flag then didn’t have a standard design. This establishment was located near the Philadelphia, Wilmington, and Baltimore Railroad station in Philadelphia and provided assistance to hundreds of thousands of soldiers traveling during the war. It opened in 1861. See the contemporary lithograph shown in figure 11-below. Several other branches opened in time. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 188 Figure 11. Chromolithography of M. H. Traubel, Philadelphia 1862 SPMC.org * Paper Money * May/June 2022 * Whole Number 339 189 D. Confederate Stamp Money from Mobile, AL Figure 12. Confederate Stamp Money note for one cent from the Mobile, AL Post Office circa 1861. Figure 13. Back of the Mobile note with two overstruck postmarks. The auction listing of this note follows; it came from the Robert Siegel philatelic auction 1073 in 2014: Mobile, Alabama 50 x 27mm thick card with printed "Post Office, Mobile. Good for 1 Cent.", manuscript name, back with two strikes of Mobile double-circle datestamp, date unclear, split vertically thru "Office" and hinged together, Fine appearance and most unusual, we have encountered examples of stamp money from New Orleans but this is the first we have offered from Mobile. While Lloyd Bowers was the postmaster of Mobile, Alabama at that time the note was signed by Assistant Postmaster Owen across the face of the note. The note is undated although the back postmark likely was dated but it is obscured today. This rare note is an example of a significant issue of stamp money by the Confederate States. Recently I wrote a detailed article of the known issues for the Confederate Philatelist (CP) magazine: Steve Feller, “Confederate Stamp Money Revisited,” CP 65 (2) 15-33 (2020). These notes were used to make small change at the various Confederate Post Offices. Figure 14. Assistant Postmaster Owen signed the Mobile postage stamp money. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 190 Lyn Knight Currency Auct ions If you are buying notes... You’ll find a spectacular selection of rare and unusual currency offered for sale in each and every auction presented by Lyn Knight Currency Auctions. Our auctions are conducted throughout the year on a quarterly basis and each auction is supported by a beautiful “grand format” catalog, featuring lavish descriptions and high quality photography of the lots. Annual Catalog Subscription (4 catalogs) $50 Call today to order your subscription! 800-243-5211 If you are selling notes... Lyn Knight Currency Auctions has handled virtually every great United States currency rarity. We can sell all of your notes! Colonial Currency... Obsolete Currency... Fractional Currency... Encased Postage... Confederate Currency... United States Large and Small Size Currency... National Bank Notes... Error Notes... Military Payment Certificates (MPC)... as well as Canadian Bank Notes and scarce Foreign Bank Notes. We offer: Great Commission Rates Cash Advances Expert Cataloging Beautiful Catalogs Call or send your notes today! If your collection warrants, we will be happy to travel to your location and review your notes. 800-243-5211 Mail notes to: Lyn Knight Currency Auctions P.O. Box 7364, Overland Park, KS 66207-0364 We strongly recommend that you send your material via USPS Registered Mail insured for its full value. Prior to mailing material, please make a complete listing, including photocopies of the note(s), for your records. We will acknowledge receipt of your material upon its arrival. If you have a question about currency, call Lyn Knight. He looks forward to assisting you. 800-243-5211 - 913-338-3779 - Fax 913-338-4754 Email: lyn@lynknight.com - support@lynknight.c om Whether you’re buying or selling, visit our website: www.lynknight.com Fr. 379a $1,000 1890 T.N. Grand Watermelon Sold for $1,092,500 Fr. 183c $500 1863 L.T. Sold for $621,000 Fr. 328 $50 1880 S.C. Sold for $287,500 Lyn Knight Currency Auctions Deal with the Leading Auction Company in United States Currency   Second Issue Fractional Currency Progress Proofs by Richard Melamed One of the more intriguing aspects of Fractional Currency are the Progress Proofs produced by the Treasury for the development of the 2nd issue. As the 1st issue of Postage Currency was being retired, the Treasury was tasked to create a new series of Fractional notes that distanced itself from the U.S. Postal Service and would be more difficult to counterfeit. What becomes immediately apparent is the very first Proofs are missing the familiar elements we associate with the regular issue (most noticeable are the non-denominational aspects and lack of a portrait). In this article we will observe how the Proofs gradually morphed into regular issue notes. Observing the step-by-step development gives us a contextual understanding of how the final design was developed. Many of these Progress Proofs were saved by Spencer Clark, who was the 1st Superintendent of the National Currency Bureau, today known as the Bureau of Engraving and Printing. These were in Clark’s possession until 1893 (Clark died in 1890) when his widow entrusted them to high profile dealer Edouard Frossard. He listed them in a fixed price offering of Fractional Progress Proofs and Experimentals. They are extremely rare – populations from one known to a couple of pieces. Lucky for the currency collecting community that Clark held onto the Proofs which are still highly sought after. The note on the left is a very early 2nd issue Progress Proof (Milton 2E5F.2e). The note on the right, is a common 2nd issue 5¢ wide margin Specimen (Fr. 1232-WM-SP-OBV) - with the final design. We highlighted the missing elements on the Proof. 1. The 4 corners are missing the denomination amount. The Specimen show four “5’s” for 5¢, while the proof has blanks where the denomination amount would eventually reside. 2. The “United” and ”States” are both printed in an Olde English font. However, on the Proof the font is hollow; on the Specimen they are shaded. 3. There is no portrait in the center of the Proof; on the Specimen, the familiar portrait of Washington is present. In later Progress Proofs, Washington’s portrait is physically pasted on. Apparently on the Proof shown above, the pasted portrait has fallen off. Note that the diagonal “SPECIMEN” overprint is interrupted where the portrait once resided. The end result is: “SPE___MEN”. 4. On the Progress Proof, Congressional “Act of July 17, 1862” is cited; which was the day that Congress approved the use of Postage Currency (1st issue). On the Specimen note, the Congressional “Act of March 3, 1863”, is cited; the day the use of Fractional Currency was authorized (2nd issue). The 1863 law moved these notes from Postage to Fractional Currency. 5. The key is missing on top of the portrait on the Proof; on the Specimen the key is present. 6. The two large “5’s” are on the left and right of the portrait are blank on the Proof. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 193 7. The "Engraved and Printed at the Treasury Department" is printed outside the boundary of the proof in a separate block rather than in its final position below the enabling date of the Specimen. These early Progress Proofs were initially focused on the obverse design. Later Negative Essays and Experimentals shifted focus on the paper, reverse colors and bronze surcharges. James Duthie, who was the first engraver of the National Currency Bureau, was responsible for creating the intricate dock scene – a steamship unloading its cargo. It is assumed the complexity of the design would help thwart the counterfeiters (it did not however). The design is the same as the proof shown above, but these examples have (3) pie wedge cancellations as opposed to the (2) half-moon cancellations we generally see. Two different color paper were tested – white and a pale yellow. Below is a Progress Proof that does include the paste-on of Washington’s portrait. This example is not punched cancelled, nor does it contain the “SPECIMEN” overprint. We excised Washington’s portrait from the Proof (left) and placed it next to the portrait from a regular issue fractional (far right). Note how Washington’s stand-alone portrait on the left has a sepia tone, while the portrait on the right is more muted – black and white. Early photographs from this era often displayed a sepia monochrome color and begs the question: was the paste-on portrait of Washington on the proof a photograph? It seems quite possible since the paste on contains no engraving lines. Further to the point, with the final design still in development, a photograph of Washington would be easier to employ than an engraving. Once the obverse design was finalized, the engravers could then move onto the task of etching our first President’s portrait onto the plate. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 194 Here are a pair of non-denomination progress proofs. Both have the paste on portrait of Washington, half-moon cancellations and “SPECIMEN” overprint. The off-white example on the left is similar to Milton 2E5F.1a. The progress proof on the right, Milton 2E5F.2a, is the same as the item above, but it’s printed on heavy yellow paper. Not all Progress Proofs have Milton Friedberg numbers. They will be identified in this article only when there is a corresponding number. From the October 11, 2007, sale of the John Ford collection by Stack’s (Part XIX) is a Progress Proof of just the George Washington portrait used on all 2nd issue Fractionals. This Proof was originally part of the F.C.C. Boyd holdings. With the obverse design set and the Treasury agreeing to the use of Washington’s portrait on the 2nd issue of Fractionals, the engraving of this portrait was commissioned. The significance of this cannot be overstated. What may seem to be inconsequential is anything but. This is the very first image of the portrait that would grace every regular 2nd issue Fractional. This was not lost to the Fractional community. The presale estimate was $300-$500; but when it when the bidding concluded, it sold for 6x the original low-end auction estimate - $1,840. We can see on the example on the left that the development is progressing. This piece is similar to several of the items in the Milton 2E5F.2 group. While it’s also a non- denominational note with the same empty cartouches, the portrait of Washington is printed rather than pasted in place. Note the wide white oval surrounding the portrait; it was only used here and was not part of the final design. Also, the “United” and ”States” are now shaded in the same manner as the regular issue. It indicates that the Treasury accepted the portrait of Washington. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 195 Here is a pair of uncut Progress Proofs likely from the same sheet as evidenced by the large margin between the notes. This pair is from the Ford XIX sale by Stacks in 2017 (pedigrees to F.C.C. Boyd). Both pairs are undated, with blank cartouches, no denomination, no “Specimen” overprint, no cancellations and no “Act of Date.” The narrow margin note above is an exact match to these pairs and is also likely from the same sheet. A very early proof, but later than the first proofs without Washington’s portrait. Like the note above, both pairs contain the wide white oval around the portrait. The “25” bronze overprint could likely be one of the very first examples of the bronze surcharge. The haphazard application of the bronze overprint is only part of story. Note below how the double line “25” on the Proof differs from the single line “25” on the reverse of the regular Fractional issue. This is the only instance of the double outline surcharge being used. The double outline was quickly dropped. Here is another note that could be mistaken for an even later Progress Proof or early Experimental. Or is it? One might think the large “50” bronze surcharge with “March 21, 1863” date indicates a later development. But strip away the surcharge and you have the empty cartouches and no “Act of Date”. Might this be an earlier Progress Proof that was subsequently stamped just after the March 21, 1863, law authorizing the 2nd issue of Fractionals was passed? The earliest examples have the July 17, 1862, date. Successive Proofs were left dateless suggesting that the Treasury knew Congress was close to approving new legislation. Once the law was passed a date could be inserted. Because of the inclusion of the bronze date, the Progress Proof might have just come after the uncut pair above. The bronze “50” surcharge on the face was very short lived. It made its way to reverse in very short order. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 196 At first glance, this pair might be mistaken for Experimentals, but these are definitely Progress Proofs - albeit ones that are further along in development. Yes, these show the first evidence of a denomination designation with the six printed “5’s” and the final Washington portrait, but there are 3 giveaways that make these a Progress Proof: 1) there is no shading behind the two large “5’s” (they are shaded in the regular issue) 2) There is no key in the disk above the portrait. 3) The “Act of Date” is still missing. The note on the left is punch cancelled with the “SPECIMEN” overprint. The note on the right has no “SPECIMEN” overprint and is not punch cancelled. Progress Proofs are of great importance since they show how the obverses of the 2nd issue of Fractional Notes were developed. With the design completed, the Treasury would progress with reverse designs. Negative Essays came next (or were concurrent) as we see different dye colors and bronze surcharges. Another phase before the regular issue is the Fractional Experimental (shown to the right) - which have a much greater population and contain the near-final designs. Thanks to Mike Marchioni and Tom O’Mara, former Fractional club presidents for their input. Also, to Heritage and Stacks Bowers for the use of the images. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 197 The Paper Column Peter Huntoon  Glass-Borah Amendment of 1932 spiked Series of 1929 Jamie Yakes  National Bank Note Circulation by a Third Purpose and Introduction The purpose of this piece is to explain how the Glass-Borah Amendment to the Federal Home Loan Bank Act of 1932 caused national bank circulation to increase by $220 million above the then outstanding $675 million. The amendment was a rider to the home loan act that was unrelated to home loans, but instead was tacked on to cause an inflation of the money supply in hopes it would help mitigate the Great Depression. The Glass-Borah amendment awarded the circulation privilege to U.S. bonds with interest rates of 3-3/8 percent or less to make it more profitable for bankers to take out circulation than the 2 percent bonds then available as security for national bank notes. This favorable provision would terminate in three year, when it was hoped the depression will have passed. Inelastic Currency The purpose of the National Bank Act was to create a new form of currency. To that end, organizers of national banks were required to purchase at least a minimum amount of U. S. Treasury bonds based on their capitalizations in order to secure their issuances of national bank notes. Curiously, despite the requirement to purchase bonds, there was no requirement that the bankers actually had to take out circulation backed by them. Prior to passage of the Federal Reserve Act of 1913, the minimum par value of bonds that the bankers were required to maintain was: (1) $50,000 for banks with a capital of $150,000 or more, and (2) one-quarter of their capital for banks with a capital of less than $150,000. The bottom line was that the National Bank Act produced a supply of national bank notes that was predicated on the combined capitalizations of all the banks in the country. Consequently, the volume of this currency was rather inflexible because the bankers couldn’t easily or quickly change their capitalizations. Thus, national currency was reviled by monetary experts as being inelastic because its volume couldn’t adjust to variable economic demands. Specifically, the supply didn’t respond to changing demands for money in the annual cyclic course of commerce. For example, when money was needed in times of increased activity, such as during crop Figure 1. The Glass-Borah Amendment caused $220 million worth of Series of 1929 type 1 nationals to be added to the existing $675 million national bank note circulation by May 1933. The primary winners were the big city banks. The officers of this New York bank increased their circulation from $8.5 to $9.9 million between October 1931 and 1933, but their capitalization remained constant at $10 million. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 198 planting season, there was a shortage of it so interest rates spiked, which hurt farmers. In times of diminished activity, such as when crops were sold, there was a surplus of it, so interest rates sank. Thus, the inelasticity exacerbated seasonal swings in interest rates. Even worse, the national bank note supply couldn’t increase rapidly during economic emergencies when cash was needed to offset hoarding. This fueled crippling money panics that came along with distressing regularity. Federal Reserve currency authorized by the Federal Reserve Act of December 23, 1913 was designed to be the desired elastic currency. It was contemplated that it would quickly supplant national currency. In fact, there were explicit provisions in the Federal Reserve Act to hasten the demise of national currency. Section 17 repealed the requirement that bankers deposit bonds to secure circulations, thus allowing them to forego issuing national bank notes. Section 18 was a provision that allowed bankers with existing circulations to sell their bonds to the Federal Reserve banks and thus get out of the currency-issuing business. All ambiguity over the matter was eliminated by Section 9 in an amendment to the Federal Reserve Act enacted June 21, 1917. That section simply reenacted the provision that national bankers were absolved of the requirement to purchase bonds to secure circulation. People rarely worried about the maximum circulation that a bank could issue. Bankers, of course, could take out more circulation than the minimum if they wished to invest in more bonds, something they did when circulation was profitable. The upper limit of circulation that a bank could subscribe for was established by Section 12 of the Gold Standard Act of March 14, 1900, which placed the maximum at 100 percent of the paid-in capital of the bank. There was a practical cap on the maximum possible total national currency supply. This was predicated by the supply of Treasury bonds that were available to back the currency. Congress accorded the so-called circulation privilege to specific bond issues. Only those bonds could be used by bankers to back their currency. The bankers would buy these bonds, deposit them with the U. S. Treasurer, and then receive national bank notes equal to the par value of the bonds. They could then press the nationals into commerce. The available bonds with the circulation privilege totaled $675 million at the beginning of 1932, virtually all of which were owned by national banks to back their national bank note issues (FR Board, 1932, p. 478). The U. S. Treasury was pleased with this cap because it limited the volume of inelastic national currency to about 12 percent of the total money supply at the time (FR Board, 1932, p. 480). Consequently, national currency no longer was a major player on the monetary stage going into 1932. The problem was that even though the available bonds used to back national bank notes earned only 2 percent interest, national bank note circulation was sufficiently profitable that the majority of the bankers held on to them and continued to maintain their circulations. In fact, the supply of eligible 2 percent bonds was insufficient for this purpose so they sold at a premium over their par value. Consequently, as the nation began to reel under the Great Depression, the inelastic national currency was not going away. By its nature, it was actually contributing to the economic woes. A Stopgap Solution Then came the Federal Home Loan Bank Act, a measure called for by Republican President Herbert Hoover to encourage home ownership by providing low-cost home mortgages. The act was signed into law by Hoover July 22, 1932. However, the form in which it passed it was a notable dud because the only people who could quality for mortgages were sufficiently well off, they didn’t need to fool with the Federal Home Loan Banks (Wikipedia). Here is where it gets interesting. Over the objections of Hoover and his Treasury officials, a rider was tacked onto the bill that became known as the Glass-Borah Amendment. This granted the circulation privilege for a period of three years from the date of passage of the act to all U. S. bonds that paid interest at 3-3/8 percent or less. The rider had nothing to do with the Federal Home Loan Banks. Its sponsors were Virginia Democratic Senator Carter Glass, former Secretary of the Treasury under Woodrow Wilson, and Idaho Republican Senator William Borah. Both were progressives. Clearly SPMC.org * Paper Money * May/June 2022 * Whole Number 339 199 their amendment was a clumsy attempt to inflate the money supply because it would make national bank note circulation sufficiently profitable it would incentivize the bankers to invest in the higher yield bonds and take out additional circulation. Far more important, it effectively blew the roof off the then current $675 million cap on total national bank note circulation by making a flood of high-yield bonds available for purchase. There were about $3 billion worth of them out there. Suddenly, instead of worrying about the nominal remaining national bank note circulation, the Treasury had to worry about the theoretical maximum amount of such currency that could be created! Not only that, they fretted about the weakening effect the move into national currency was going to have on the Federal Reserve system because the bankers would turn to the Federal Reserve banks to get the money they needed to buy the newly eligible bonds (FR Board, 1932, p. 474-476). Treasury officials quickly fathomed that the maximum theoretical national bank note circulation was the collective capitalization of all the banks in the country. They summed these and found that total national bank capitalization was $1.570 billion. A mechanism was now in place that could result in almost a billion-dollar expansion of the national bank note supply. The potential increase was almost one and half times the size of the existing national bank note supply! The rider on the FHLB act gave bankers a strong incentive to swap out elastic Federal Reserve currency for inelastic national currency, just what the Treasury and economists didn’t want. If taken to its logical conclusion, nationals would grow to 30 percent of the total money supply rather than 12 percent! Then national currency would be a major factor. Although he chaffed, President Hoover didn’t veto the bill when it crossed his desk because he rationalized that the potential spike in national bank note circulation would only last until 1935 when the Figure 2. Carter Glass (left) Democratic senator from Virginia and William E. Borah (right) maverick Republican Senator from Idaho sponsored the Glass-Borah rider to the Federal Home Loan Bank Act of July 22, 1932 giving a three-year circulation privilege to 3-3/8 percent or lower interest U.S. bonds that caused a one-third spike in national bank note circulation by 1933. Wikipedia photos. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 200 circulation privilege for the high yield bonds expired (Awalt, 1932, p. 5). Then the bankers would have to sell those bonds and their money would flow back into the Federal Reserve banks. There would be a reverse substitution of nationals back into FRNs so things would normalize. An important fact is that the FHLB Act did not increase the tax bankers had to pay on their circulation if they used the higher yield bonds. Consequently, the spread between the interest they earned and the tax they had to pay was greater than the spread with the 2 percent bonds. The result was a strong incentive for them to swap out their existing 2 percent bonds even if they didn’t increase their circulations. Impact on National Bank Circulation What actually occurred in the short term is exactly what was predicted. Of course, the bankers who had surplus cash acted in their self-interest and bought the high yield bonds and used them to inflate their circulations. Within three months of passage of the FHLB act, the national bank note supply grew by $125 million and continued to grow. It spiked to $893 million at the beginning of May, 1933, its second highest level in history (O=Conner, 1935). This peak followed the election of Roosevelt and the bank holiday. The FHLB spike amounted to $220 million more than the early 1932 national bank note circulation, a 33 percent increase. A spike of $220 million was a quarter of the worst-case scenario contemplated by the Hoover Treasury, but even so it was a significant increase. Just as you might expect, the market value of the old 2 percent bonds fell below par and the glamorous new high yield bonds started selling for a premium as the bankers competed against each other and other investors as they substituted the new for the old (FR Board, 1932, p. 479). They not only bought the high yield bonds to support increased circulations, many simply swapped out their old 2 percent bonds that were used to back their existing circulations. Type 1 national bank notes were the impacted series thanks to the $220 million increase in national bank note circulation. That many more type 1 nationals were issued than otherwise would have been the case. The rapidly rising tide also helped lift the demand for type 2s when they came along at the end of May 1933, but not by the same degree. By the time the type 2s arrived, the peak national bank note circulation already had been achieved so the type 2s were largely replacements for type 1s that were wearing out. Their numbers of course were greater than they would have been without the FHLB act simply because the total amount of nationals in circulation was greater. Figure 3. Graph showing the impact on the total outstanding circulation of national bank currency by the Glass-Borah Amendment. The tic marks on the horizontal axis represent December 31st of the years shown. If the FHLB act had not been passed, there would have been some $220 million fewer nationals in circulation during the peak of the small note era. This would have translated into a roughly 25 percentage decrease in the number of them available to you collectors! As for just which small size nationals became more common as a result of the FHLB act, it was the big city bank issues. The big city banks, simply by virtue of their size, held the overwhelming dollar value of available uncommitted capitalization, so their savvy management put it to work to their advantage (FR Board, 1932, p. 479). In economic terms, the big city banks already were basking in a surplus of cash whereas the small SPMC.org * Paper Money * May/June 2022 * Whole Number 339 201 country banks were strapped. Thus, the big city banks preferentially got to increase their circulations. After the smoke cleared, the well-intended rider on the FHLB act didn’t do the economy or the little guy any good. The Phoenix National Bank An excellent example of bankers who took advantage of the Glass-Borah Amendment were those at The Phoenix National Bank, Arizona. Their circulation was $150,000 backed by 2% bonds going into 1932, a figure that had held constant during the Series of 1929 era up to then. In August 1932 they bought $350,000 worth of the glamorous high yield bonds in four lots that bore interest at between 3% and 3-3/8%, boosting their circulation to an astronomical for them half million dollars. To order to make their investment in these bonds pay twice, they had to loan the $350,000 that their bonds bought. This was a high-risk proposition at that point in the Great Depression but they did circulate the new currency once it arrived so they somehow put it to work. In August 1933 they sold $98,000 worth of 3 percent bonds. This was followed in June 1934 by the sale of $252,000 of their remaining highest-yield bonds; specifically, $175,000 of 3-3/8 percenters and $77,000 of 3-1/8 percenters, leaving them with their original $150,000 circulation backed by their old 2% bonds. They apparently felt so cleansed in getting rid of that circulation, they unloaded the remaining $150,000 of their 2% bonds in August 1934, thus, getting completely out of the note-issuing business. In this peculiar case, the rate of bond sales beginning in August 1933 exceeded the rate at which the National Currency Redemption Agency in the Treasurer’s office could scavenge their excess notes from circulation. The result was that no type 2 notes were sent to the bank. The bank was issuing $10 and $20 type 1 Series of 1929 notes at the time the bankers ramped up their circulation to $500,000 in 1932. The Comptroller’s clerks covered most of new $350,000 using $20s; specifically, sheet serials 948-1094 sent August 12th, 1095-3047 sent August 30th, 3048-3662 sent August 31st, and 3663-3830 sent September 17th, totaling $345,960. $10 sheets 3425-3492 totaling $4,080 were included in the August 31 shipment to cover the remainder. [These shipments total $350,040, because the September 17th shipment of $20s included an extra $40 to cover worn notes redeemed from circulation.] The Comptroller’s inventory of notes for the bank at the time the bankers bought these bonds was insufficient to cover them, so shipment of most of the notes was delayed until new printings could be received from the Bureau of Engraving and Printing; specifically, $20 sheets 1095-3662 on August 30, 1932 and 3663-4702 on September 17th along with $10s 3813-5350. The last sheets sent to the bank were $10 4126 and $20 3974, both from the printing that arrived September 17, 1932. Significantly, of the 3,974 $20 type 1 sheets worth of notes issued from the bank, 73% were from the initial shipments made to cover the Glass-Borah bond purchases. Of the $20 type 1 notes Figure 4. The Glass-Borah Amendment encouraged the bankers at The Phoenix National Bank to increase their circulation from $150,000 to $500,000 in 1932 through their purchase of $350,000 worth of high-yield bonds as allowed under the amendment. This note send to the bank on August 30, 1932 was included in that increase from a printing that was received from the Bureau of Engraving and Printing that same day. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 202 reported from the bank as of 2021, 70% are from these shipments. Outcome The last gasp tilt toward keeping national currency viable was the ill-advised Glass-Borah rider to the Federal Home Loan Bank Act of 1932 that bolstered its profitability for the bankers by allowing them to use bonds with interest rates of up to 3-3/8 percent to secure their circulations. The amendment was a populist measure designed to inflate the total money supply with hopes that some would trickle down to the little guy on the bottom rung of the economic ladder during the depths of the Great Depression. In reality, it just made the big city bankers richer and temporarily burdened the economy with an increased dose of more inelastic currency. The worst fears of Hoover’s Treasury officials that the national bank note supply could inflate by $1 billion to $1.7 billion as a result of the Glass-Borah Amendment didn’t come to pass. The actual increase was $220 million above the pre-FHLB act circulation of $675 million in 1932. The circulation privilege on the high yield bonds expired on June 22, 1935. Next, the Treasury called all the remaining 2 percent bonds that carried the circulation privilege on August 1, 1935. That was the end of inelastic national currency so reviled by economists and Treasury officials. Thus, the Roosevelt’s New Deal Treasury got rid of the last of it in 1935 by executive action, not through market forces as envisioned by the framers of the Federal Reserve Act back in 1913. Sources of Information and Sources Cited Awalt, F. G., 1932, Increase in the Circulation of National-Bank Notes; in, Annual Report of the Comptroller of the Currency: U. S. Government Printing Office, p. 4-5. Comptroller of the Currency, 1863-1935, National currency and bond ledgers: Record Group 101, U. S. National Archives, College Park, MD. Comptroller of the Currency, issued annually, Annual Reports of the Comptroller of the Currency: U. S. Government Printing Office. Federal Reserve Board, Aug 1932, Review of the Month, home loan banks, p. 474-476, & Recent legislation on national bank note circulation, p. 478-480: Federal Reserve Bulletin, vol. 18, no. 8. O=Connor, J. F. T., 1935, Table 4-Authorized capital stock of national banks, circulation secured by bonds, etc.; in, Seventy-Third Annual Report of the Comptroller of the Currency for the year ended October 31, 1935: U. S. Government Printing Office, 852 p. United States Statutes, National Bank Act and amendments of various dates; Federal Reserve Act and amendments; Federal Home Loan Bank Act of Jul 22, 1932: U. S. Government Printing Office. Wikipedia: http://en.wikipedia.org/wiki/Federal_Home_Loan_Bank_Act. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 203 National Bank Notes with Women Signatures by Frank Clark I have an affinity for National Bank Notes that are different for one reason or another. This is often in the eye of the beholder, so there are no set rules. Beginning in the late 1980s, I noticed that some Nationals have women signatures. My first purchase of a note with a woman's signature was a $5 Brown Back on the National Bank of La Grange, Indiana, charter number 4972, that was pen signed by Vice President Katherine R. Williams. I started to keep track of women signers of Nationals and this listing is the result of that labor. It is now time to share my findings of more than 30 years on this subject with the SPMC membership. I did not record every denomination that I found a woman's signature on as I elected to just record by major type for a particular charter number. Nonetheless, the listing has grown far larger that I would have ever imagined. However, I am positive that this list is nowhere near complete. Abbreviations used in the listing are found at the very end. Also, included in the listing are male bank officers, who due to their names, are often mistaken for women bank officers. Initials have been deciphered as much as possible and some of these were obtained by using the U.S. Banks & Bankers database that is found on the www.spmc.org website. I also included a few facts on various officers, and these will follow immediately after an officer's listing. Every note in my listing has been observed by me or a fellow collector. I would like to thank everyone who helped me compile this listing. Special thanks go to Karl S. Kabelac who wrote articles on various women bank officers for our Paper Money journal over the years. If you have any corrections or additions, please email them to me at frank_spmc@yahoo.com. City & State Charter Series Type Officer's Name & Title Comments Prattville, AL 9055 1902 PB Mrs. (Ernestine) R(omie) M(ae) McCord - C Berryville, AR 10406 1902 PB Ruth McLuwon - AC Gentry, AR 12340 1902 PB Sadie Monroe - C Marked Tree, AR 11122 1902 PB Ruby Hastings - AC Mena, AR 7163 1902 PB Naomi Pryor - AC Pine Bluff, AR 6680 1902 PB Cora Niven - AC Springdale, AR 8763 1902 PB Clara E. Henson - AC Tombstone, AZ 6439 1902 PB Mary M(cNelis) Costello - P Mary is mother of Ruth Image courtesy of Heritage Auctions Archive SPMC.org * Paper Money * May/June 2022 * Whole Number 339 204 City & State Charter Series Type Officer's Name & Title Comments Tombstone, AZ 6439 1902 PB Ruth C. Costello - VP Tombstone, AZ 6439 1902 PB Ruth C. Costello - C Ducor, CA 10301 1929 T1 Rhoda Perkins - C Hermosa Beach, CA 12271 1902 PB Anne Meuret - AC Long Beach, CA 8870 1902 PB Naomi C. Tompkins - C Long Beach, CA 12819 1902 PB Jannitte C. Webster - AC Long Beach, CA 12819 1902 PB Naomi C. Tompkins - VP Marysville, CA 11123 1902 PB Phebe M. Rideout - P Oroville, CA 10282 1902 PB Phebe M. Rideout - P Riverdale, CA 10200 1902 PB Pauline L. Gobby - AC San Pedro, CA 7057 1902 PB Katherine R. Mahar - P Akron, CO 10901 1902 PB Mary Wenig - AC Akron, CO 10901 1902 PB Edna B. Clark - C Akron, CO 10901 1929 T1 Edna B. Clark - C Akron, CO 10901 1929 T2 Edna B. Clark - C Salmon, ID 9432 1902 PB Marie Ryan - AC Brighton, IL 9397 1902 PB Roberta L. Simmons - C Brookport, IL 6713 1902 DB Grace Butterworth - AC Brookport, IL 6713 1902 DB K(atherine) L(ukens) Holifield - C Ms. Holifield as cashier served with her husband H(enry) W(alton) Holifield as president  and earlier with her father, John F. McCartney as president  Carterville, IL 7889 1902 PB Mabel Hadfield - AC Casey, IL 6026 1929 T1 Rose Turner - C Cuba, IL 11144 1929 T1 Marie C. Harrison - C Fairmount, IL 11443 1929 T1 Shirley T. Catlett - C Male Freeburg, IL 7941 1929 T1 Susie M. Wolf - C Gilman, IL 5856 1882 VB Ella L. Row - C Gilman, IL 5856 1902 PB Marie W. Hausmann - AC Greenville, IL 9734 1902 PB Myrtle T. Bradford - P Greenville, IL 9734 1902 PB N(ancy) R(ogers) Bradford-P Kankakee, IL 1793 1863 OR Helen Clarke - C (Male - H(aswell) C. Clarke Lawrenceville, IL 5385 1929 T1 Edna E. Thorn - C Madison, IL 8457 1902 DB Elizabeth Brooks - C SPMC.org * Paper Money * May/June 2022 * Whole Number 339 205 City & State Charter Series Type Officer's Name & Title Comments Marion, IL 4502 1929 T1 Shannon Holland - P Male Princeton, IL 2165 1882 DB Pearl Lafferty - C Wilsonville, IL 12630 1902 PB Lucille Bertetto - AC Columbus, IN 1066 1929 T1 Elizabeth Lucas - P Green Forks, IN 7124 1929 T1 Elizabeth J. Ward - C Flora, IN 8014 1902 PB Blanche Wickard - C Flora, IN 8014 1929 T1 Blanche Wickard - C Green Forks, IN 7124 1902 PB Mary Hadfield - AC Green Forks, IN 7124 1929 T1 Elizabeth J. Ward - C La Grange, IN 4972 1882 BB Katherine R. Williams - VP Albia, IA 1799 1902 DB Nannie M. Mabry - P Belle Point, IA 4754 1929 T1 Laverne Clark - P Male - Melvin L. Clark Buffalo Center, IA 5154 1902 PB Bessie McDermott - AC Creston, IA 2833 1902 PB Grace S. Harsh - VP Diagonal, IA 9125 1902 PB Bessie D. Ferris - AC Fontanelle, IA 7061 1902 PB L. Bess Currie - AC Grand River, IA 9737 1929 T1 Florence E. Madison - C Strawberry Point, IA 9069 1902 PB Gertrude Opperman - AC Beloit, KS 3231 1929 T1 Josie Eresch - C Ms. Eresch was the daughter of President Peter Eresch and two of her siblings worked at the bank as well - brother was VP and a sister was a bookkeeper Beloit, KS 3231 1929 T2 Josie Eresch - C Jewell, KS 3591 1902 PB Irma L. Nixon - C Jewell, KS 3591 1929 T1 Irma L. Nixon - C Lyndon, KS 7222 1902 PB Ada Niebart - C Lyndon, KS 7222 1929 T1 Ada Niebart - C Nortonville, KS 5359 1929 T2 Bessi V. Webb - C Olathe, KS 3720 1902 PB H(olly) E. Hayes - C Male Stafford, KS 8883 1929 T1 Alice E. Simonson - C Cannel City, KY 7891 1929 T1 Bertha J. Leslie - C Cannel City, KY 7891 1929 T2 Bertha J. Leslie - C Clay, KY 8943 1902 PB Albina Hearin - VP Belfast, ME 7586 1902 PB Alberta W. Farnham - AC Fort Kent, ME 11403 1902 PB Irene Cyr - C SPMC.org * Paper Money * May/June 2022 * Whole Number 339 206 City & State Charter Series Type Officer's Name & Title Comments Limerick, ME 2785 1902 DB Frances E. Moulton - P Limerick, ME 2785 1902 PB Mildred B. Johnston - C Limerick, ME 2785 1929 T1 Mildred B. Johnston - C Medomak, ME 1108 1929 T2 Frances D. Storer - C Van Buren, ME 10628 1902 PB Alexis A. Ceyr - C Van Buren, ME 10628 1929 T1 Alexis A. Ceyr - C York Village, ME 4844 1882 DB Elizabeth B. Davidson - P York Village, ME 4844 1902 PB Elizabeth Davidson - P Elkton, MD 1236 1882 BB E(valyn) S. Tome - P Elkton, MD 1236 1882 BB E(valyn) S. France - P Port Deposit, MD 1211 1882 BB E(valyn) S. Tome - P Woburn, MA 7550 1902 PB Mary E. Godkin - AC Escanaba, MI 3761 1902 PB Leslie French - C Male Three Rivers, MI 600 1929 T2 (Miss) K.B. Weinberg - C Albany, MO 7205 1929 T1 Mrs. R(ichard) L. Whaley - P Margaret Joplin, MO 8947 1902 RS Mrs. V.F. Church - C Joplin, MO 8947 1902 DB Tillie Muller Ade - C Neosho, MO 6382 1902 PB Ruth M. Barrett - AC Perryville, MO 11402 1929 T2 Mary C. Frioux - C Purdy, MO 10122 1902 PB Mabel Fly - C Stewartsville, MO 4160 1902 PB Nell Snow - AC Stewartsville, MO 4160 1929 T1 Nell Snow - C Stewartsville, MO 4160 1929 T2 Nell Snow - C Versailles, MO 13367 1902 PB Beatrice Sherrill - C Versailles, MO 13367 1929 T1 Beatrice Sherrill - C Austin, MN 4131 1902 PB Alice Dee - AC Bricelyn, MN 6478 1902 PB Amanda B. Fosness - AC Married Melvin G. Monk - 1925 Fairfax, MN 9771 1929 T1 Gertrude O. Fiss - C Mabel, MN 9031 1902 PB A(my) T. White - VP Daughter of Betsey Tollefson - P Mabel, MN 9031 1929 T1 Betsey Tollefson - P Wells, MN 4669 1902 PB Grace B. Matthies - AC Jackson, MS 6646 1902 DB Anne R. Johnston - C SPMC.org * Paper Money * May/June 2022 * Whole Number 339 207 City & State Charter Series Type Officer's Name & Title Comments Grass Range, MT 10939 1902 PB W. Louise Davis - C Hamilton, MT 9486 1902 PB Clare Conroy - AC Male Beemer, NB 6818 1902 PB Leona Frahm - AC Elgin, NE 5440 1902 PB Carrie McBride - P Elgin, NE 5440 1929 T1 Carrie McBride - P Elwood, NE 7204 1902 PB Chrystal Shallenberger - VP Fullerton, NE 2964 1902 PB Della Fitzgerald - AC Humphrey, NE 5337 1882 BB Bey Martin - P Male Lexington, NE 3292 1882 DB Henrietta R. Temple - P Lexington, NE 3292 1902 DB Jennie M. Temple - P McCook, NE 9436 1902 PB Mrs. V(ocanses) Franklin - P Minatare, NE 13316 1929 T2 Helen M. Littlejohn - C Minatare, NE 13316 1929 T2 Helen M. Bauman - C Minden, NE 9400 1929 T1 Clara S. Hines - C Minden, NE 9400 1929 T1 Clara H. McQuillan - C Minden, NE 9400 1929 T2 Clara H. McQuillan - C Naper, NE 9665 1902 DB Vera F. Erickson - C Naper, NE 9665 1902 PB Vera F. Erickson - C Plattsmouth, NE 1914 1902 PB Anna Wanga - AC Trenton, NE 8218 1902 RS Ethyl Hall - C Peterborough, NH 1179 1929 T1 Fay Lewis - C Male Farmington, NM 6183 1929 T1 H(arriet) B. Sammons - P Farmington, NM 6183 1929 T2 H(arriet) B. Sammons - P Hagerman, NM 7503 1902 PB Ruth Lathrop - AC Lake Arthur, Ter. NM 8584 1902 DB Ida Hammond - AC Nara Vista, Ter. NM 8663 1902 DB Ruth Burns - C Argyle, NY 13521 1929 T1 Lillian J. Johnson - C Argyle, NY 13521 1929 T2 Lillian J. Johnson - C Bayside, NY 7939 1902 PB M(abel) Vaughn - C Cherry Creek, NY 10481 1902 DB N(ora) B. Lake - C Cherry Creek, NY 10481 1929 T1 Nora B. Lake - C East Rochester, NY 10141 1902 DB Kate Gleason - P Granville, NY 7255 1902 PB Anna Williams - AC SPMC.org * Paper Money * May/June 2022 * Whole Number 339 208 City & State Charter Series Type Officer's Name & Title Comments Groton, NY 1083 1882 BB W(elthea) M. Marsh - P Hornell, NY 262 1929 T1 W.L. Henry - AC Ms. Henry was known as "Nellie" Mexico, NY 5293 1882 DB Nellie T. Peck - P Mexico, NY 5293 1929 T1 Alice K. Halligan - C Mexico, NY 5293 1929 T2 Alice K. Halligan - C Montour Falls, NY 13583 1929 T1 Belle P. Cornell - C North Rose, NY 10016 1902 PB Martha A. Peck - C North Rose, NY 10016 1929 T1 Martha A. Peck - C Palmyra, NY 295 1882 BB H(arriot) H(yde) Sexton - VP Perry, NY 4519 1882 BB E(liza) D(olbeer) Page - P Roslyn, NY 13326 1929 T1 Helen A. Wood - C Roslyn, NY 13326 1929 T2 Helen A. Wood - C Scarsdale, NY 11708 1929 T1 Ann Burton - C Scarsdale, NY 11708 1929 T2 Ann Burton - C Silver Spring, NY 6148 1902 RS Addie P. Duncan - P Silver Spring, NY 6148 1902 DB Addie Duncan Monroe - P Waverly, NY 297 1929 T2 Louise C. Jones - C Westfield, NY 12476 1902 PB Lucile Lichtenwalter - C Westfield, NY 12476 1929 T1 Lucile Lichtenwalter - C Abercrombie, ND 8419 1902 PB Alma Tiveto - C Fingal, ND 7295 1902 DB L(aura) A. (Donohue) Batcheller - P Lidgerwood, ND 5772 1902 PB E(lla) C. Parizek - AC Lidgerwood, ND 5772 1902 PB M(argaret) E. Voyek - AC Lidgerwood, ND 5772 1902 PB M(ary) O(ttillie) Movius - P Ms. Ottillie was known as "Lidgerwood's Grand Old Lady" Canfield, OH 3654 1902 PB Ethel L. Fowler - AC Cleves, OH 13774 1929 T2 Ruth Firth - C Galion, OH 1984 1902 PB Mary O. Volk - C Galion, OH 1984 1929 T1 Mary O. Volk - C Garrettsville, OH 2034 1929 T1 Marie Hewitt - C Garrettsville, OH 2034 1929 T2 Marie Hewitt - C La Rue, OH 6675 1902 PB Marie L. English - C SPMC.org * Paper Money * May/June 2022 * Whole Number 339 209 City & State Charter Series Type Officer's Name & Title Comments Mount Washington, OH 9761 1902 PB Edith E. Lancaster - C Seven Mile, OH 9518 1902 PB Anna K. Bell - AC Utica, OH 7596 1929 T1 C(ora) B. Clark - P Altus, OK 6113 1929 T1 Mrs. J.A. Henry - P (Mary Elda Cobb) Anadarko, OK 5905 1929 T1 G(ertrude) M(yers) Cox - P aka Mrs. I.E. Cox who succeeded husband I(raton) E(veret) Cox in Oct. 1917 Anadarko, OK 5905 1929 T2 G.M. Cox - P Beggs, OK 6868 1902 PB Iva M. Reading - C Beggs, OK 6868 1902 PB Grace M. Watson - C Coweta, OK 6879 1902 PB Lesse Vernon - C Coyle, OK 12148 1902 PB Nora M. Fruin - C Coyle, OK 12148 1902 PB Carlotta M. Fruin - C Coyle, OK 12148 1929 T1 Carlotta M. Fruin - C Foraker, OK 10356 1902 PB Selma J. Codding - C Klamath Falls, OR 7167 1902 PB Leslie Rogers - C Male Klamath Falls, OR 7167 1929 T1 Leslie Rogers - C Male Klamath Falls, OR 7167 1929 T2 Leslie Rogers - C Male Luther, OK 8563 1929 T2 Gladys Bednar Hickok - C Daughter of the bank president Medford, OK 5796 1882 DB Luella F. Stewart - VP Pond Creek, Ter. OK 6655 1902 RS Naomi Wheatley - AC Monmouth, OR 10071 1902 PB Emma M. Parker - AC Prairie City, OR 9763 1902 PB Patsy Daly - P Male Prairie City, OR 9763 1929 T1 Patsy Daly - P Male Prairie City, OR 9763 1902 PB D(onald) J. Hughes - C Male A male, not "Miss D.E. Hughes" who is listed incorrectly as VP on page 158 of Oregon National Currency Images, Signatures, Statistics by Jim Mallard Prairie City, OR 9763 1929 T1 D.J. Hughes - C Sheridan, OR 8721 1902 DB Zella Cox - C Silverton, OR 11106 1929 T1 Olga Alrick - C Atglen, PA 7056 1902 PB Louise L. Hastings - AC Atglen, PA 7056 1902 PB Louise L. Hastings - C Atglen, PA 7056 1929 T1 Louise L. Hastings - C Atglen, PA 7056 1929 T2 Louise L. Hastings - C SPMC.org * Paper Money * May/June 2022 * Whole Number 339 210 City & State Charter Series Type Officer's Name & Title Comments Mechanicsburg, PA 326 1902 PB Ruth M. Heffelfinger - AC New Alexandria, PA 6580 1902 DB Doty Guthrie - P Male New Alexandria, PA 6580 1902 PB Doty Guthrie - P Male New Alexandria, PA 6580 1929 T1 Nora J. Dornon - C Williamsburg, PA 6971 1929 T1 Alice F. Dietrick - C Providence, RI 1007 1902 PB Shirley Harrington - C Male Providence, RI 1007 1929 T1 Shirley Harrington - C Male Bartlett, TX 7317 1929 T2 Mary A. Bartlett Brownwood, TX 9812 1902 DB Mrs. S(amueld R(ichardson) Coggin - P Deport, TX 6430 1902 PB Mrs. J(ohn) H(enry) Moore - P Mrs. Moore became president upon her husband’s death Deport, TX 6430 1929 T1 Mrs. J.H. Moore - P Gregory, TX 10241 1902 PB May M(athis) Green Watson - P Gregory, TX 10241 1929 T1 May M(athis) Green Watson - P Haskell, TX 4474 1929 T1 Mrs. M(arshall) S(amuel) Pierson - P nee Margaret Nancy Rice Haskell, TX 4474 1929 T2 Mrs. M.S. Pierson - P Mrs. Pierson became president upon her husband’s death Haskell, TX 14149 1929 T2 Mrs. M.S. Pierson - P Jacksboro, TX 7814 1902 DB Ellie Mither - C Marlin, TX 5606 1929 T1 Mrs. Emma Reed - P Mount Pleasant, TX 4722 1882 BB Mrs. Jno. R Towler - P Annie McLean Towler Valley View, TX 7731 1902 PB Della Walker - C Winnsboro, TX 5674 1902 PB Pearl James - AC Poultney, VT 2545 1902 PB Adeline L. Nieframe - AC Waco, TX 11140 1902 PB Mrs. C(harles) P(ennell) Adams - P Wolfe City, TX 3984 1882 BB Ula Bush - C Male Woodstock, VT 1133 1929 T1 Helen H. Saul - C Woodstock, VT 1133 1929 T2 Helen H. Saul - C Pearisburg, VA 8091 1929 T1 Frances E. Miller - C Kent, WA 10174 1902 PB Annie F. Morrill - P Chilton, WI 5933 1902 PB M.C(ecilia) Bosshard - C SPMC.org * Paper Money * May/June 2022 * Whole Number 339 211 City & State Charter Series Type Officer's Name & Title Comments Chilton, WI 5933 1929 T1 M.C. Bosshard - C Meeteetse, WY 6340 1902 PB Sarah L. Hogg - VP Image courtesy of Heritage Auctions Archive SPMC.org * Paper Money * May/June 2022 * Whole Number 339 212 U N C O U P L E D : PAPER MONEY’S ODD COUPLE Joseph E. Boling Fred Schwan Fancy Numbers Fred is showing MPCs with fancy serials this month. Back in the days when I was a Japan specialist, I picked up a couple of fancy number notes as well. All Festers and many YNs and former YNs know that my magic number is 8. That number has been associated with me in many ways through my life. The last two digits of my SSAN are 88. My first assignment in the Army was to the 8th Infantry Division in Germany. My third assignment was to the 88th Supply and Service Battalion in Vietnam. My original IBNS member number was 808. My original ANA member number was 80803. All of those were coincidence. I subsequently became life members #8 and #2888 of IBNS and ANA. Those were intentional. And, as additional opportunities have arisen, I have accumulated lots of 8s in my life member numbers for SPMC (388), Numismatics International (188), Seattle Numismatic Society (8), and probably a couple more that I am not remembering. So, when Fred roped me into collecting MPC by position number, he did it by selling me 4-5 cheap MPC (with a 100% discount), all from position 8. I am now the only collector known to have completed the conventional set of MPC all from one position. Fortunately for me, no position 8 notes have appeared from the two unissued series. We have only whatever Mr. 691 managed to spirit out of the destruction facility, and the crates with that number in them did not happen to fall within his grasp. As I said at the top, I also managed to pick up some Japanese notes with 8s as serial numbers. As a Japan specialist, looking for 8s was both a blessing and a curse. The numeral 8 is a lucky number in the orient, so notes with solid 8s are much sought after. This causes them to be noticed and saved, but also causes them to be expensive. It also causes fakers to alter notes to have solid 8 numbers. I have seen some of those but have not been able to acquire one. Solid 8s are also used on hell See Boling pg 215 Fancy Numbers Paper money collectors love numbers. Serial numbers in particular of course, but some others too. I cannot prove that military payment certificate (MPC) collectors are more keen than all others, but in general they are more interested than most! The most popular numbers in silver certificates, FRNs, and the like are certainly the favorites among MPC collectors too. They all love low numbers (think of Joe and his eights). Ladders, solids, palindromes, and others are very popular. The trouble is that it is extremely hard to have a collection of these because they are so terribly rare. In the MPC world only one each serial number 1, 2, and 3 (a replacement) are known. Not only are there no numbers 4 or 5, but there is also no number 8! Just to add a twist, most of these numbers exist in the unissued Series 691 and possibly Series 701. Another interesting twist is that the serial number 18 is on an otherwise rare replacement (Series 651 $10). Low number on a rare replacement Solid 1s SPMC.org * Paper Money * May/June 2022 * Whole Number 339 213 If nothing else, MPC collectors are resourceful. If we cannot find traditional fancy numbers, we will collect near fancies and even numbers that are just cute. One solid is known, but several “near solids,” that is seven (or six) of one numeral. One of the near solids is eights—Series 692 10 cents E08888888E! One eight-digit ladder is known and several partials. The real innovations came when MPC collectors could not find enough near fancies; MPC collectors have gotten very creative. They like MPC with the last three digits of the serial matching the series number. Basically, one in one thousand notes searched should yield one match. That seems about right. These matches are not rare or even extremely scarce. We are also interested in serial numbers ending in the series AND denomination, such as Dxxx10481D for either a Series 481 $10 or 10 cents. To make it easier Dxxx48110D is equally acceptable. For that matter D10481xxxD would probably be eagerly added to a collection. The problem is that no series plus denomination pieces have been reported! Doug Bell recently found a certificate with serial number E04301937E. Now that is a number that would certainly be passed by silver certificate collectors. Doug jumped on it. Why? It is the date that General Douglas MacArthur was married: April 30, 1937. Was that the reason or was it because April 30, 1937 was the date that women’s suffrage was passed in the Philippines? Both of these historical facts are true, but the reason that Doug grabbed the note was that the number was a date, any date. If you can find a date, you can find a historical event. That is what happened here. It seems like such numbers should be easily found, but they are not. This date note and the wedding picture were the subject of an April Fools prank published in the MPCGram. McArthur wedding photo Near solid 8’s The only issued full ladder known. Matching serial numbers Radar serial The only issued number 1, courtesy of Logan Talks McArthur wedding date serial. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 214 If fancies are not enough, you can compound the “problem.” Joe told you that he collects MPC by position number! He has completed his number 8 set! That is quite an achievement. Think about it, there are 84 fractional notes to a sheet. A collection consists of 48 fractional notes. How many notes do you have to search and for how long to find them all from position 8? Joe is not the only position collector. Larry Smulczenski is down to one note for his position 39 set! Jack Hunter is far advanced on his number 21 set and there are others. As with many things, it is easier for a team to accomplish than for an individual. These position collectors know which collectors are collecting which numbers and watch for them while they search for their own. I have given up on my number 1 set, but I still work a bit on my special variation—I collect MPC with the position number matching the denomination. These notes look great. The position number looks like another counter on the note. There are even harder tasks, much harder. Doug Bell decided to compound the project. He collected all 90 of the regular issues by position number! Think about that. Just for the fractional denominations that is 48 certificates by 84 positions (heck, I find 84 x 48 a rather pleasing number). That is 4032 fractionals. Eventually Doug gave up, but he “completed” several series. Harold Kroll attempted what must be the hardest ever collection. He set out to collect the highest serial number known (observed or reported) for each of the 90 issued pieces. The obvious problem with that is that it is a moving target! While Harold gave up on the overall project, collectors are looking for the highest serial numbers. The closest that I have heard is 33 from the end. The survey that I have been conducting of MPC replacements (for more than 40 years) is a kind of serial number collecting. I had not thought of that in this way until this moment. It has been a very successful endeavor, but I, as Doug and Harold above, am overwhelmed with data. We have about 4500 numbers and all but one of the issues found. Amazingly, there is even a twist here. A fellow ran a competing survey! Rather than report new finds to the published survey (mine), he ran a survey of replacements that were not known to Schwan! MPC collectors collect far more than actual military payment certificates. Allied military currency and some others are often called MPC by collectors and noncollectors alike. Other things are gathered with MPC under the broader category of military numismatics. I had intended to discuss fancy numbers in these categories, but I more than took my space (and used up my energy) with military payment certificates. Next time we will do the other fancies. If you have anything to share, now is your chance. fredschwan@yahoo.com Boling continued money and trade coupons that borrow designs from circulating notes; the printers of the coupons elect to put dummy serials on their products, saying (naturally) 88888. It has also happened to me on invoices. I collect notes of places I have lived. One of those was Englewood, Colorado (at age 4). The most reliable way to collect a biographical note in the US is to look for National Currency. Englewood notes are not easy to find. When I finally did manage to buy one, the total bill (hammer, buyer’s fee, and shipping) came to exactly $888. As I was starting to collect my position 8 notes, I told Fred I wanted to get a replacement as a representative of how they are indicated (no suffix letter in the serial number). He found one from position 8, and wonder of wonders, his invoice was $88. That isn’t a bad price for a nice MPC replacement, but it looked like a set-up to me. So here are a few 8s. Figure 1 (below) is a Japanese 5 yen note with serial number 000008—and it happens to be from block 88. I found that in a Tokyo dealer’s stock. A Japanese 1000 yen note is shown below, also with serial number 000008. It came from a Yokohama auction. Below is a Philippine 10 piso note with solid 8s. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 215 A Japanese small saver’s bond from the Sino-Japanese war period (before Pearl Harbor), with serial 088888 is show below. It came from eBay. The two notes shown below are US and Jersey notes, each with serial 888. Moving off the beaten track, a Saudi Arabian note also with solid 8s—in a different script—is shown below. Below is a piece of depression scrip with serial 0008. The Federal Reserve Bank of China specimen book shown below has serial number 0000008. I have many more examples of serial numbers composed of 8s. Moving away from single magic numerals, what else makes a fancy number? Below are a Cayman Islands note with a serial number of my birth year, and a Bermuda note with my original IBNS member number as a serial—808. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 216 For many collectors, replacement notes are a special interest, and replacements usually have some aspect of their serial number that identifies them. I already mentioned what it is for MPC—no suffix letter. Obviously that does not make a conventional fancy number, but it does add value in most cases, so it is something that a faker would be inclined to try to create. In the case of MPC, it simply means removing a character, which is easier than adding or altering one. Here is such a case. Shown below is a proper MPC replacement (that happens to be from my position 8 collection). Note the lack of an F concluding the serial number. A doctored MPC with its terminal letter removed by abrasion and re-coloring the bare paper is shown below. That note on a light box, as you can see below, shows how the paper was thinned when the letter was scraped off. The faker tried to color over the bare spot—not terribly convincingly as seen at left. Fred owns one much more skillfully altered. But even if you don’t have magnification capability in hand, you can check the serial number. The last serial for Series 651 $1 replacements is A00560000. The serial on this note far exceeds that. A Series 641 dime with an extra character (looking like a sans-serif “I”) following the serial number rests below. Who knows what the maker thought this could represent? To show that the added character is not original, the image below shows it at 20x magnification. It was applied with a lead pencil, deeply embossing the note out the other side. But at 20x magnification, its true nature is revealed. The graphite is reflecting the light from the USB microscope’s LED bulbs back into the camera. It is plain that the added character does not look anything like a legitimate printed letter. Looking at another way that a number can be misused, consider the case of a counterfeiter who does not understand the function of the position numbers on MPC (they show where the note was on the sheet before the sheet was cut up), and furthermore, does not know how many notes should have been on the sheet. In such a case, the position number used on the counterfeit may be higher than the number of notes on a sheet—a sure sign of a bogus note. I believe I have one buried in my unaccessioned materials, but I don’t know where to start looking for it to show you. Next time? Make a suggestion. joeboling@aol.com SPMC.org * Paper Money * May/June 2022 * Whole Number 339 217 The Obsolete Corner The Mount Hecla Steam Mills by Robert Gill As I write this article the world is on the verge of war, with things being in turmoil because of one country attempting to take over another. By the time you're reading it, who knows what will be happening. At least we can try to temporarily forget about what's going on by enjoying our great hobby. So, let's look at the sheet from my collection that I've chosen to share with you. In this issue of Paper Money let's go to the 1830s North Carolina and look at The Mount Hecla Steam Mills. As you look at the scan you can see that the printing plate was laid out in an unusual format, that being just three notes instead of the most common two note or four note layout. And to add to its unusualness, the printer used four note sized paper, resulting in very large selvage on top and bottom of the sheet. Although the Company name is not listed on the notes, the eventual owner's name, T.R. Tate, is, giving correct attribution to the notes. So now, let's look at the history of this enterprise that was so essential to its part of the country. Commencing its operations in Greensborough, Guilford County, North Carolina, in 1833, The Mount Hecla Steam [Cotton] Mills is recognized as the first textile factory in North Carolina to employ steam power. Founded by Henry Humphreys, an unsung trailblazer for the southern textile industry, this Company was located on the Northwest corner of Bellemeade and Battleground, now North Greene Street. Uncovered evidence has been found that Humphreys’ interest in manufacturing began earlier than Guilford County records indicate. First built in 1818, Humphrey’s Mount Hecla Mill had two distinct periods of operation. The first was from about 1818 to about 1825, and a second and more prosperous period after 1830, when plans were made for the use of steam power. The original mill was built on a stream outside Greensborough, and employed the waterpower of a dam that Humphreys had earlier constructed to operate a gristmill. The first frame structure apparently excited little interest in the 1820s, for it was listed in a newspaper article as merely “one of the four mills in the state.” But from this humble start, the second largest mill in ante- bellum North Carolina soon developed. Designing and building North Carolina’s first purpose-built, completely integrated cotton mill was a visionary quest for Humphreys, and one that would require most of his time and capital to accomplish. It appears that he began in 1828 to free up his time and money by selling his successful mercantile operations. The next order of business would have been to acquire machinery, which was built to order, and might take many months to be delivered. Humphreys somehow developed a relationship with Rogers, Ketcham and Grosvenor, one of the earliest American textile machinery manufacturers, headquartered in Paterson, New Jersey. His original machinery purchases are unknown, but an inventory of the contents of the factory in 1840, shows that it included all the equipment needed for “vertically integrated” textile manufacturing; that is, “from bale [of cotton] to bolt [of cloth]”. While the production machinery would have been extraordinarily “high-tech” to local residents, undoubtedly the star of the collection was the steam engine that was designed to power the entire operation. Using the first steam engine in the county, and what may have been the first in North Carolina, as the factory’s prime mover was a central aspect of Humphreys’ vision to bring the factory to Greensborough, a county seat without a major watercourse. Steam power was so unusual that it suggested the name of the entire operation. If the engine was the beating heart of the factory, a transmission system of iron shafts, pulleys and leather belts was the circulatory system that transferred that power to each machine. A massive brick and stone building housed the framework needed to anchor and shelter it all. A four-story, fifty foot wide by one hundred fifty-foot-long brick building, with attic and basement, was built. Space for future expansion was built in. Though just twenty-one spinning frames with two thousand ninety-six spindles operated in 1840, the building was designed to accommodate eight thousand five hundred spindles, or seventy-one spinning frames. The imposing factory was probably the largest SPMC.org * Paper Money * May/June 2022 * Whole Number 339 219 structure in Greensborough at the time, yet it was just one element of a sixteen-acre operation. The campus also included stables, lumber houses, and houses for operatives. After years of design, construction, training and practice, the risky and costly venture finally went into operation and was declared a winner. On June 30th, 1834, Humphreys proudly announced in the local newspaper, The Greensborough Patriot: The factory was a source of both public pride and consuming curiosity in the Greensborough community. When the mill was first opened, the yarns were so popular that people from the surrounding area camped all-round the factory, waiting for the yarns to come off the machinery. Much of its success was attributed to the novel, yet vital steam engine, which guaranteed constant reliable operation, while water-powered mills generally shut down for at least a month each summer due to drought. Company scrip was issued and used by mill employees, and, as described in the Arnett-Jackson book, Greensboro, North Carolina: The County Seat of Guilford, “was readily accepted as currency by all in the community.” Henry Humphreys enjoyed the success of his creation for less than ten years before he died on March 26th, 1840. The circumstances of his death are unknown, but he made a will that attempted to provide security for his children. Humphreys left his property equally divided among his three children, Absalom, Sarah, and Nancy. He made his “highly esteemed and well- beloved son-in-law, Thomas R. Tate, in whose prudence and honest I have unbounded confidence”, the executor of his will, giving him also the “superintendence and management of the cotton factory and its operations”, at an annual salary of $1,000.00. The mill continued to have good success, and in February of 1848, Tate took complete control when he purchased the factory with all its outbuildings, shops and machinery, together with the housing and associated land, for the sum of $15,845.00. Later that same year, he moved The Mount Hecla operation to a site next to the Catawba River in Gaston County. There, under the new name of Mountain Island Manufacturing, the Company continued its production. So there's the history behind this old operation that made developments in the textile industry, resulting in helping to develop this great nation of ours. As I always do, I invite any comments to my personal email address robertdalegill@gmail.com or my cell number (580) 221-0898. So, until next time, HAPPY COLLECTING. “The subscriber takes unfeigned pleasure in announcing to the public, that his splendid STEAM COTTON FACTORY is now in the full tide of successful operation; and that whether factories of this description can now be advantageously carried on in the South is no longer a matter of doubt. It has long been disputed, and not until recently given up, that an individual enterprise of the kind could succeed; but he is now making from twelve to 1,500 POUNDS of spun cotton per week… He expects to put an additional quantity of machinery in operation during the month of August, when he will be able to turn out THREE THOUSAND POUNDS PER WEEK.” SPMC.org * Paper Money * May/June 2022 * Whole Number 339 220 SPMC.org * Paper Money * May/June 2022 * Whole Number 339 221 Robert Calderman “Replacement National Spotted in Dallas!”  Spring began in style this year with a brand new tradition in Dallas Texas! A very select group of elite collectors met for the first annual National Bank Note Collectors Conference hosted by Heritage Auctions. I attended the early April gathering and can say first- hand, “This is an event you must attend if you are a true fan of national bank notes!” Diehard collectors carved time out of their demanding schedules to spend a couple of days exhibiting extraordinary pieces from their unbelievable collections! Many from the group gave impromptu presentations discussing the origin story of their collecting career and ongoing collecting goals, while passing around jaw dropping rarities in a show-and-tell style roundtable. It was an intense and awe inspiring experience hearing stories detailing the lifelong pursuits and accomplishments that were achieved by my fellow collecting brethren. The journey we take as individuals can be so vastly different while in the same instance, as collectors, our goals are so strikingly similar. The Monday/Tuesday event was further highlighted by a VIP behind the scenes tour of the new and massive Heritage HQ SPMC.org * Paper Money * May/June 2022 * Whole Number 339 222 facility! With over five hundred employees and over two-hundred-and-fifty thousand square feet, it was like stepping into a collectors dream akin to the magical world of Narnia! Our group was treated like royalty with two days of superb catered lunches and an evening steak house dinner that would’ve impressed the likes of James Bond himself! The first annual National Bank Note event was capped off by an exclusive opportunity to see a prototype preview of the not yet printed Central States Auction Catalog, including a chance to lot view all of the notes from the upcoming sale! It was a much more relaxed and enjoyable atmosphere lot viewing in style without the added pressure and time constraints of a hustle bustle coin show. My want list expanded significantly once I’d held such a large portion of the treasures that will be hitting the auction block here in the near future. If this vividly accurate description sounds like something you’d enjoy, make plans to attend next year’s NBN event tentatively scheduled for April 2023. One of my newest and favorite national bank notes featured on display in Dallas, from my personal collection exhibit, was this impressive large size 1902 $5 Date Back on The Crocker National Bank of San Francisco. At first glance, this rather common second title note doesn’t appear to be a life changing trophy example. Charter #3555 was a large only bank that issued millions of notes and nearly 500,000 five dollar date backs alone! This note featuring treasury serial number T71984 and bank serial number 24820 with stamped signatures of Cashier W. Gregg Jr. and President William Henry Crocker clearly has treasure written all over it. Only the most advanced National Bank Note students will likely hold the skills required to cherry pick a note like this. It just so happens that this is exactly what took place when this San Francisco note sold at auction back in 2016 for a miniscule $129.25! Then housed in a PCGS-Currency VF30 Apparent holder the future of this note seemed very dim. Fortunately an eagle eyed sleuth picked this note and subsequently sent it in to PMG for proper attribution. Now it lives a new life as a glorious and ever so scarce Large Size Replacement National Bank Note!!! It was a lucky day for this collector when such a cool note was offered to me at the recent Spring ANA National Money Show in Colorado Springs! Sorry, but this note is now unavailable and deeply buried in my California collection; you will have to go and hunt for your own example my friends. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 223 Do you have a great Cherry Pick story that you’d like to share? Your note might be featured here in a future article and you can remain anonymous if desired! Email scans of your note with a brief description of what you paid and where it was found to: gacoins@earthlink.net “News Flash! – This Just In…” If you cannot wait until next year to break bread with your fellow paper money enthusiasts, there is another brand new event on the horizon that is rapidly sending an audible buzz across bourse floors throughout the country! If you can believe it, the last all paper money show was held way back in June 2019. For many of us, the truly dedicated collectors, our annual paper money show is unquestionably the ultimate highlight of our collecting year! With such a lengthy hiatus, it has been absolutely excruciating having nothing scheduled on the horizon to scratch our itch! Thankfully a bold and adventurous man from Texas has risen to the occasion to save us!!! I am proud to announce it is finally official; Jim Fitzgerald has an upcoming all paper money show scheduled October 20th-22nd 2022 in Tampa Florida! If you crave more paper and the joyous camaraderie of hunting notes with your fellow collectors, book your trip immediately! There will be no better place to be this fall than in Tampa! I for one have already reserved four tables! Don’t miss out; get your tables booked ASAP before they are all gone. For More Information:  Large Size Replacement National Bank Notes, 1903 - 1920  R.  Shawn  Hewitt (Presentation can be found on: www.spmc.org)  National Bank Note Conference Photos courtesy Heritage Auctions. Visit: www.ha.com 224 The front of the Type-40 Treasury note endorsed by Benjamin Bloomfield, Chief Quartermaster. image: Randall Smith Maj. Benjamin Bloomfield Chief Quartermaster, District of Texas The endorsement of Maj. Benjamin Bloomfield can be found with some perseverance (rarity R11), and with only one known exception, it is always endorsed with the place of issue at Houston, Texas. Although we encounter Bloomfield most often as the Chief Quartermaster for the District of Texas, New Mexico, and Arizona, he began his career in the eastern theater of the war where he reported to Gen’l John Bankhead Magruder in the Department of the Peninsula. Magruder and Bloomfield were later reassigned to Texas. A Wikipedia article on Magruder gives some context for Bloomfield’s history: en.wikipedia.org/wiki/John_B._Magruder. Bloomfield is important not only for his contributions to Texas but because he literally wrote the manual for quartermasters. This rare manual can be found online and it is a goldmine of information about the duties of a quartermaster. The title page and index is illustrated to show the variety of these duties. The illustrated treasury note was endorsed in April of 1863 when Bloomfield was assigned to Houston. The endorsement reads: “Houston Texas April 3/ 1863 by B Bloomfield Maj &c” The Quartermaster Column No. 24 by Michael McNeil The endorsement of Benjamin Bloomfield, Maj. &c. The term “&c” is commonly used in these endorsements to mean “and et cetera,” which in this case would include “Chief QM.” The blue ink is rare. image: Randall Smith SPMC.org * Paper Money * May/June 2022 * Whole Number 339 225 1861 There are 145 documents in Bloomfield’s file in the National Archives on the Fold3.com website. Benjamin Bloomfield was appointed on April 27th as Capt. & AQM reporting to the 2nd Louisiana Regiment. On December 24th Bloomfield was appointed as Maj. & QM reporting to Gen’l J. B. Magruder. Bloomfield initially served in Virginia with Gen’l Magruder, and at one point served under the command of Robert E. Lee. Bloomfield was stationed at Yorktown, Virgina, for the last half of 1861, and his audited balance sheet at that location showed cash flows of $696,130.74. He sometimes signed vouchers as “Chief Quartermaster of the Peninsula.” 1862 During the Seven Days Battle of June 25th to July 1st, Gen’l Magruder mentioned Bloomfield as the Chief QM of his Corps, Army of Northern Virginia. On July 16th Gen’l Magruder filed a report with Adj. & Inspector Gen’l S. Cooper in Richmond, Virginia, in which he wrote: I cannot express too strongly my estimate of the services by my Chief Qr Mr Major Bloomfield. Soon after he took charge he introduced order, promptness and economy in the management of his department, the scarcity of supplies and materials was so great as to make it impossible to expect them, the Genius, Energy and extraordinary industry of Major Bloomfield, however, overcame all obstacles and enabled the Army of the Peninsula to move, to march and to fight with the regularity of a machine. This statement is made in justice to Major B. Bloomfield who is absent on account of sickness at the time that I write. After the Seven Days Battle Bloomfield followed Magruder to Houston, Texas, when Magruder was given command of that district on November 29th. It is from Bloomfield’s post in Houston that we find treasury notes with his endorsement. 1863 In September of 1863 Bloomfield relieved Maj. Minter of duty at San Antonio, Texas. Bloomfield was sent on a special assignment by Gen’l Magruder in October of 1863, in which he was engaged in expediting the sale of cotton. Bloomfield was a careful businessman and spotted ambiguities in military contracts which would lead to civilian graft. Here is his letter of November 5th to Lt. S. D. Yancy, A. A. Gen’l in Houston: Permit me respectfully to call your attention to the ambiguity of Special Order No 289 & the construction [interpretation] that may be placed upon it. As I understood the contract with Major Russell and Mr. Lavenburg – Mr. Lavenburg was to transport (2000) Two thousand bales of cotton for a/c [account] of Major Russell on behalf of the Govt. As the order now reads it gives clearly the privilege to Mr. Lavenburg to transport & export two thousand (2000) bales of cotton for his own a/c and from his antecedents [past behavior] I should judge he will be the man to avail himself of the interpretation to transport (2000) Two Thousand bales for himself in addition to the number required by Major Russell. The previous Quartermaster Column featured Edward C. Wharton, a quartermaster who reported to Bloomfield, and who complained bitterly about civilian graft and corruption. With this letter from Bloomfield we see a concrete example. 1864 Bloomfield was paid $162 per month as a Major and Chief Quartermaster on June 3rd. To put this pay into perspective, women signers of Treasury notes in Columbia, South Carolina, were paid $250 per month for signing 2,000 Treasury notes per day, significantly more than an army Major. Some of this discrepancy in pay is probably explained by local costs of living. A letter of March 1st from Bloomfield stated that quarters in the city of Houston were difficult to obtain “according to the high prices now prevailing,” and that “...quarters cannot be obtained at less than twenty dollars per month for each room in Houston.” The Treasury note signers in Columbia, by comparison, faced hotel room rates of $80 per day, or eight times their daily salary; they were housed in dormitories. 1865 The ultimate fate of Bloomfield is unknown and there are no records of his surrender or parole in 1865. ◘ Carpe diem SPMC.org * Paper Money * May/June 2022 * Whole Number 339 226 An endorsement by Bloomfield on a document in which he signed as “Major & Chief Qr master.” image: Fold3.com Benjamin Bloomfield literally wrote the manual for quartermasters. The index illustrated at the right lists the complex duties of a quartermaster. Quarterly reports were submitted to the Quartermaster General’s Office in Richmond, and the forms for those reports are shown in this manual. In practice the quartermasters did not have printed copies of these forms, but they were carefully drawn to imitate the forms shown in the manual. Even Bloomfield’s quarterly returns show these hand-drawn forms. images: licensed in the Public Domain SPMC.org * Paper Money * May/June 2022 * Whole Number 339 227 Chump Change Loren Gatch Book Note Roger Lowenstein, Ways and Means: Lincoln and his Cabinet and the Financing of the Civil War (New York: Penguin Press, 2022). Behind every single piece of currency are the stories of all the people who ever used it. Likewise, behind every type of currency are origin stories of those historical junctures that gave rise to new forms of paper money. Roger Lowenstein’s Ways and Means provides a very accessible account of how America’s experiment with legal tender paper money, the “Greenback”, came about. While not a numismatic book in any sense, Ways and Means sketches out the financial and monetary measures undertaken, particularly by the Union government, to underwrite the deadliest war ever fought by the United States. To defend the Union, Lincoln and his Administration needed to mobilize the nation’s resources on an unprecedented scale. This had to be done in three ways: raising taxes, borrowing money, or printing money. None of these three things the government had much practice in doing. Up until then, the national government was tiny, and its capacity to do such things was minimal. Key to Lincoln’s attempt to finance the Civil War was his Treasury Secretary, Salmon Portland Chase, the most important figure to hold that office since Alexander Hamilton. Secretary Chase was a complicated man: capable and moral, but also ambitious, and somewhat devious, especially when it came to his rivalry with Lincoln, whom he sought to replace as President with himself! Lincoln valued Chase for his administrative abilities, but kept his rival close, outmaneuvering him when he had to. Chase was not a fan of government paper money, but circumstances forced his hand. War bonds proved hard to float. Desperate for something to pay the soldiers and their suppliers, Chase issued the first $50m of a new instrument in July of 1861, called “Demand Notes” because holders could redeem them for gold coin on demand. When these ran out, Congress voted to issue a second batch in February 1862. These, called “United States Notes”, were really the first Greenbacks ever issued. Unlike Demand Notes, they were made a legal tender and weren’t redeemable in gold. More followed. By the end of the Civil War, some 450 million dollars’ worth of this new currency was issued. Greenbacks ended up financing about 15% of the war effort. The rest came from taxes and borrowing. Greenbacks were a controversial and imperfect monetary instrument. Wartime inflation was severe, but hardly as bad as what afflicted the South. The Greenback’s value fell steeply against gold during the Civil War, moving up and down depending on how well the conflict was going for the Union. Nonetheless, they did the job. On the back of the notes are important clues as to what made Greenbacks work. The new notes were legal tender for all debts, public and private. But there were three crucial twists to their legal status. First, duties on imports into the United States had to be paid in gold coin—Greenbacks couldn’t be used to do this. This assured the government a fresh supply of specie flowing into public coffers. Second, Greenbacks couldn’t be used to pay interest on the public debt—that had to be paid in gold coin too. This backstopped the value of that debt, as long as investors had some confidence that the Union government would be around to pay it back at some point. Finally, Greenbacks “were receivable in payment of all loans made to the United States.” This meant that the government was willing to borrow back the same Greenbacks that it was printing and spending. And indeed, it was willing to pay gold coin on the interest. So, for whatever reason, anyone wishing not to hold (depreciated) Greenbacks could always trade them in for bonds that paid regular interest in (appreciated) gold coin. The result, as Lowenstein suggests, was “an alchemy machine, a device for turning paper into specie.” At the end of the War, questions of law and financial propriety came to the fore. Even if Greenbacks were necessary to win the war, should they be continued in peacetime? By 1864, Lincoln had dealt with his troublesome rival by making Salmon P. Chase Chief Justice of the Supreme Court. There, he was in a position to pass legal judgment on the very currency that he brought into existence. And, remarkably, Chase the jurist opposed as unconstitutional the very money he had created (and had put his own portrait on) as Treasury Secretary! In the case of Hepburn v. Griswold from 1870, Chase disowned his own monetary progeny. Briefly, it seemed, legal tender paper currency might be made illegal. But, thanks to appointments by President Ulysses S. Grant of two pro-Greenback judges, that decision was reversed the following year. The Greenback was here to stay. SPMC.org * Paper Money * May/June 2022 * Whole Number 339 228 OUR MEMBERS SPECIALIZE IN NATIONAL CURRENCY They also specialize in Large Size Type Notes, Small Size Currency, Obsolete Currency, Colonial and Continental Currency, Fractionals, Error Notes, MPC’s, Confederate Currency, Encased Postage, Stocks and Bonds, Autographs and Documents, World Paper Money . . . and numerous other areas. THE PROFESSIONAL CURRENCY DEALERS ASSOCIATION is the leading organization of OVER 100 DEALERS in Currency, Stocks and Bonds, Fiscal Documents and related paper items. PCDA To be assured of knowledgeable, professional, and ethical dealings when buying or selling currency, look for dealers who proudly display the PCDA emblem. For further information, please contact: The Professional Currency Dealers Association PCDA • Holds its annual National Currency Convention in conjunction with the Central States Numis- matic Society’s anniversary convention. Please visit our Web Site pcda.com for dates and location. • Encourages public awareness and education regarding the hobby of Paper Money Collecting. • Sponsors the John Hickman National Currency Exhibit Award each June at the International Paper Money Show, as well as Paper Money classes and scholarships at the A.N.A.’s Summer Seminar series. • Publishes several “How to Collect” booklets regarding currency and related paper items. Availability of these booklets can be found on our Web Site. • Is a proud supporter of the Society of Paper Money Collectors. Or Visit Our Web Site At: www.pcda.com James A. Simek – Secretary P.O. Box 7157 • Westchester, IL 60154 (630) 889-8207 • email: nge3@comcast.net Heritage Numismatic Auctions, Inc. LSM0818768, Paul Minshull LSM0605473. BP 20%; see HA.com. 63441 DALLAS  |  NEW YORK  |  BEVERLY HILLS  |  CHICAGO  |  PALM BEACH LONDON  |  PARIS  |  GENEVA  |  BRUSSELS  |  AMSTERDAM  |  HONG KONG Always Accepting Quality Consignments in 40+ Categories Immediate Cash Advances Available 1.5 Million+ Online Bidder-Members To consign alongside these rarities, contact a Heritage Consignment Director today. 800-872-6467, Ext. 1001 or Currency@HA.com Fr. 2230-E $10,000 1928 Federal Reserve Note Fr. 2220-F $5,000 1928 Federal Reserve Note Now Accepting Consignments to Our Official Long Beach Signature® Auction U.S. CURRENCY SIGNATURE® AUCTION Long Beach | October 5-7