Paper Money - Vol. XLIV, No. 4 - Whole No. 238 - July - August 2005

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Table of Contents

Ty, , 0 LECTO IYA L 0115rS°Irj1/tik N Societe EMPRIINT MILLIONS tt TI I 0 1 x3us ' ,.1,-7.,',77 , Ifni! p! , ' , ifio! Ns ,s soo mazr,00 cll.° rC RESP ABILITt LINdITe tEET A LAwliww1;s; 4; Ldre PrOUR Ii'AlifOliTISSEMENT lTIONS A LOTS,DU CANAL D PANAMA, thil,SON DU 26 JUIN 1888 E 72Q PUBLIQUE DEUX MILLIONS YOBLIGATIOIVS A LO mos par an des yables reznestrfellenlent les ler Deceutbre et ler juin de cheque eandle 'sables par, Jote. ou a 400 francs deux U13 deial Ouorinatun de 99 arta 711 DE TITRES GARANTIS PAR LE GOUVERNEMENT IS DEPOT DE RENTES FR NCS ET LE PAIEMENT DES LOTS SERONT GARAATIS PAR UN 1\T ° I, 0 9 , 3 3 2oat/.477N zaratateiveiselle du Canal Interocdanique a ecaisst.;. dev-r' •itre v•e • '• • • • • , • tompagnie glei:eurxseire°31, dinss•les•• • • • • • nal Interociaietne • nt es lots ,tines du prospec Part:DENT.DIRECTEIM L Jo OIRE PORTEU FRANCA R 4lICUNE GARANT1E 011 flESPONSABILITE DE L'ET4T GOCIA . . e uere irmai qe sur chic • . • 10. • • . 300. 4 cs de tc; • • HIGhteFINA OIVFORMNENT AUX PRESCRIPTIONS OE LA 1.01 DU 21 11141 183$P4R LA LW DII 8 JU N 1888, stoE 114Y835 "CANAL OfTEROC EVIIQIIiVESDE #44/VAI\A MBINIEg REDREAMS; 1131 titigr Wrz. .SUeCESSES; Vicf KiBIG . ,.. ESdu au ro Aroveftbre FRANCS1888r+ u 7111411RE • • • lt. *0 10 CIF tieduire :/ntêrets A 4 0 . • F /, au 5 no- ont — rsernent net. . . vernbre 4888, impiess dQuits• .s c"" TIMBRE VERSEMENT DE 45 M IA's*" dry I au fl S tE)F r ESTABLISHED 1880 Our Outstanding Team of Experts Can Help You Get the Most for Your Collection 125 You've spent years putting together an outstanding collection, and now you are ready to sell. Will the people who handle the disposition of your collection know as much about it as you do? They will at Smythe! UM31D) YEARV Autographs; Manuscripts; Photographs; International Stocks and Bonds. DIANA HERZOG President, R.M. Smythe & Co., Inc. BA, University of London; MA, New York University — Institute of Fine Arts. Former Secretary, Bond and Share Society; Past President, Manuscript Society; Editorial Board, Financial History. Board Member: PADA. U.S. Federal er National Currency; U.S. Fractional Currency; Small Size U.S. Currency; U.S. MPC. MARTIN GENGERKE Author of U.S. Paper Money Records and American Numismatic Auctions as well as numerous articles in Paper Money Magazine, the Essay Proof Journal, Bank Note Reporter and Financial History. Winner of the only award bestowed by the Numismatic Literary Guild for excellence in cataloging, and the 1999 President's Medal from the American Numismatic Association. Member: ANA, SPMC. Small Size U.S. Currency; Canadian Banknote Issues; U.S. Coins. SCOTT LINDQUIST BA, Minot State University, Business Administration/Management. Contributor to the Standard Guide to Small Size U.S. Paper Money U.S. Paper Money Records. Professional Numismatist and sole proprietor of The Coin Cellar for 16 years. Life Member: ANA, CSNS. Member: PCDA, FCCB, SPMC. U.S. and World Coins. ANDY LUSTIG has been dealing in U.S. and World coins since 1975, and has attended more than 2,000 coin shows and auctions. His specialties include U.S. patterns, pioneer gold, and rarities of all series. He is a co-founder of The Society of U.S. Pattern Collectors, a major contributor to the 8th Edition of the Judd book, a former PCGS grader, and a co-founder of Eureka Trading Systems. Member: ANA, GSNA, CSNS, NBS, ANUCA, FUN, ICTA, and USMexNA. Please call for our auction schedule. Antique Stocks and Bonds; U.S. Coins; Paper Money. STEPHEN GOLDSMITH Executive Vice President, R.M. Smythe & Co., Inc. BA, Brooklyn College. Contributor to Paper Money of the United States, Collecting U.S. Obsolete Currency, Financial History, and Smart Money. Editor, An Illustrated Catalogue of Early North American Advertising Notes; Past President and Board Member, Professional Currency Dealers Association. Member: PCDA, ANA, SPMC, IBSS, New England Appraisers Association. U.S. and World Coins. NI RAT LERTCHITVIKUL has been dealing in U.S. and World coins since 1976. Area of specialties include U.S. and World coins. Nirat has been a contributor to many world coin catalogues, and has authenticated world coins for third party grading services. Founder of website. Member: ANA, FUN, NAT, PCSG, NGC, GSNA, CSNS U.S. Coins and Medals. JAY ERLICHMAN Contributor to A Guide Book of U.S. Coins and A Guide Book of British Coins. Assembled and managed investment portfolios of U.S. coins. Employed by the Federal Trade Commission as an expert witness on consumer fraud. Member: ANA, PCGS, NGC. Ancient Coins and Medals. THOMAS TESORIERO Proffesional Numismatist for 38 years in New York. Ancient Greek and Roman coins, medieval, world gold and silver, paper money. Long time member of the New York Numismatic Society, involved with the Membership Committee. Member: ANA, ANS, AINA, FRNS. 2 Rector Street, 12th Floor, New York, NY 10006-1844 TEL: 212-943-1880 TOLL FREE: 800-622-1880 FAX: 212-312-6370 EMAIL: WEBSITE: cda “31.114711.111., Stephen Goldsmith N Scott Lindquist TERMS AND CONDITIONS PAPER MONEY is published every other month beginning in January by the Society of Paper Money Collectors (SPMC). Second-class postage is paid at Dover, DE 19901. Postmaster send address changes to Secretary Robert Schreiner, P.O. Box 2331, Chapel Hill, NC 27515-2331 0 Society of Paper Money Collectors, Inc., 2005. All rights reserved. Reproduction of any article, in whole or in part, without express written permis- sion, is prohibited. Individual copies of this issue of PAPER MONEY are available from the Secretary for $6 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 spe- cific issue cannot be guaranteed. Include an SASE for acknowledgment, if desired. Opinions expressed by authors do not necessarily reflect those of the SPMC. Manuscripts should be typed (one side of paper only), double-spaced with at least 1-inch margins. The author's name, address and telephone num- ber should appear on the first page. Authors should retain a copy for their records. Authors are encouraged to submit a copy on a 3 1/2-inch MAC disk, identified with the name and version of software used. A double-spaced printout must accompany the disk. Authors may also transmit articles via e-mail to the Editor at the SPMC web site ( ). Original illustrations are preferred but do not send items of value requiring Certified, Insured or Registered Mail. Write or e- mail ahead for special instructions. Scans should be grayscale at 300 dpi. Jpegs are preferred. . ADVERTISING • All advertising accepted on space available basis • Copy/correspondence should be sent to Editor • All advertising is payable in advance • Ads are accepted on a "Good Faith" basis • Terms are "Until Forbid" • Ads are Run of Press (ROP) • Limited premium space available, please inquire To keep rates at a minimum, all advertising must be prepaid according to the schedule below. In exceptional cases where special artwork or addi- tional production is required, the advertiser will be notified and billed accordingly. Rates are not commissionable; proofs are not supplied. Advertising Deadline: Subject to space availabil- ity copy must be received by the Editor no later than the first day of the month preceding the cover date of the issue (for example, Feb. 1 for the March/April issue). With advance approval, cam- era-ready copy, or electronic ads in Quark Express on a MAC zip disk or CD with fonts sup- plied, may be accepted up to 10 days later. ADVERTISING RATES Space 1 time 3 times 6 times Outside back cover $1500 $2600 $4900 Inside cover 400 1100 2000 Full page 360 1000 1800 Half page 180 500 900 Quarter page 90 250 450 Eighth page 45 125 225 Requirements: Full page, 42 x 57 picas; half-page may be either vertical or horizontal in format. Single-column width, 20 picas. Except covers, page position may be requested, but not guaran- teed. All screens should be 150 line or 300 dpi. Advertising copy shall be restricted to paper cur- rency, allied numismatic material, publications, and related accessories. The SPMC does not guar- antee advertisements, but accepts copy in good faith, reserving the right to reject objectionable material or edit copy. 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 upon prompt notification. PAPER MONEY • July/August 2005 • Whole No. 238 241 Paper Money Official Bimonthly Publication of The Society of Paper Money Collectors, Inc. Vol. XLIV, No. 4 Whole No. 238 JULY/AUGUST 2005 ISSN 0031-1162 FRED L. REED III, Editor, P.O. Box 793941, Dallas, TX 75379 Visit the SPMC web site: IN THIS ISSUE FEATURES The Financial Career of Ivar Kreuger, "The Match King" 243 By Don Rocco Financing the French Panama Canal, A Portfolio 249 By Joaquin Gil del Real Isthmian Collectors Club celebrates 30th anniversary 251 By Robert J. Karrer Smithsonian Curator calls attention to Keatinge-Ball anomaly 255 By Dick Doty About Texas Mostly: Jefferson Lottery Ticket 275 By Frank Clark On This Date in Paper Money History 276, 278 By Fred Reed Phone call results in shopping bag find 280 By Bob Andrews Series 1995 $1 "B" Star Notes 282 By Francis X. Klaes An Early Florida Advertising Note 286 By Ronald J. Benice Collecting Stock Certificates of the Panama Rail Road 290 By Albert Irizarry "The Clever Minkies" and the Pi Note 306 By Donald Noss Jr. Notes from Up North: Varied Challenges 'Down Under' 308 By Harold Don Allen The Buck Starts Here: Some Anniversaries 310 By Gene Hessler Interest Bearing Notes: What's In a Name? 311 By Dave Bowers The Paper Column: $1 FRN Intermediate Back Plate 1821 312 By Peter Huntoon SOCIETY NEWS Dealer reports major obsolete currency theft 261 Ohio National Currency Collectors Assn. takes shape 285 National Bank Note Title Project 289 President's Column 314 By Ron Horstman New Members 316 SPMC Librarian's Notes 318 SOCIETY OF PAPER MONEY COLLECTORS INC. 242 July/August 2005 • Whole No. 238 • PAPER MONEY Society of Paper Money Collectors The Society of Paper Money Collectors (SPMC) was orga- nized in 1961 and incorporated in 1964 as a non-profit organiza- tion under the laws of the District of Columbia. It is affiliat- ed with the American Numismatic Association. The annual SPMC meeting is held in June at the Memphis IPMS (International Paper Money Show). Up-to-date information about the SPMC and its activities can he found on its Internet web site . 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 member- ship; other applicants should be sponsored by an SPMC member or provide suitable references. MEMBERSHIP—JUNIOR. Applicants for Junior membership must be from 12 to 18 years of age and of good moral character. Their application must be signed by a parent or guardian. Junior mem- bership 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 $30. Members in Canada and Mexico should add $5 to cover postage; members throughout the rest of the world add $10. Life membership — payable in installments within one year is $600, $700 for Canada and Mexico, and $800 elsewhere. The Society has dispensed with issuing annual mem- bership cards, but paid up members may obtain one from the Secretary for an SASE (self-addressed, stamped envelope). Members who join the Society prior to October 1 receive the magazines already issued in the year in which they join as avail- able. Members who join after October 1 will have their dues paid through December of the following year; they also receive, as a bonus, a copy of the magazine issued in November of the year in which they joined. Dues renewals appear in the Sept/Oct Paper Money. Checks should be sent to the Society Secretary. OFFICERS ELECTED OFFICERS: PRESIDENT Ron Horstman, 5010 Timber Ln., Gerald, MO 63037 VICE-PRESIDENT Benny Bolin, 5510 Bolin Rd., Allen, TX 75002 SECRETARY Robert Schreiner, P.O. Box 2331, Chapel Hill, NC 27515-2331 TREASURER Mark Anderson, 335 Court St., Suite 149, Brooklyn, NY 11231 BOARD OF GOVERNORS: Mark Anderson, 335 Court St., Suite 149, Brooklyn, NY 11231 Benny J. Bolin, 5510 Bolin Rd., Allen, TX 75002 Bob Cochran, P.O. Box 1085, Florissant, MO 63031 Gene Hessler, P.O. Box 31144, Cincinnati, OH 45231 Ronald L. Horstman, 5010 Timber Ln., Gerald, MO 63037 Arri "AJ" Jacob, P.O. Box 1649, Minden, NV 89423-1649 Robert J. Kravitz, P.O. Box 303, Wilton, CA 95693-0303 Tom Minerley, 3457 Galway Rd., Ballston Spa, NY 12020 Robert R. Moon, 201 Baxter Court, Delmar, NY 12054 Judith Murphy, P.O. Box 24056, Winston-Salem, NC 27114 Fred L. Reed Ill, P.O. Box 793941, Dallas, TX 75379-3941 Robert Schreiner, P.O. Box 2331, Chapel Hill, NC 27515 APPOINTEES: PUBLISHER-EDITOR Fred L. Reed HI, P.O. Box 793941, Dallas, TX 75379-3941 CONTRIBUTING EDITOR Gene Hessler, P.O. Box 31144, Cincinnati, OH 45231 ADVERTISING MANAGER Wendell A. Wolka, P.O. Box 1211, Greenwood, IN 46142 LEGAL COUNSEL Robert J. Galiette, 3 Teal Ln., Essex, CT 06426 LIBRARIAN Robert Schreiner, P.O. Box 2331, Chapel Hill, NC 27515-2331 MEMBERSHIP DIRECTOR Frank Clark, P.O. Box 117060, Carrollton, TX 75011-7060 PAST PRESIDENT Frank Clark, P.O. Box 117060, Carrollton, TX 75011-7060 1929 NATIONALS PROJECT COORDINATOR Arri "AJ" Jacob, P.O. Box 1649, Minden, NV 89423-1649 WISMER BOOK PROJECT COORDINATOR Bob Cochran, P.O. Box 1085, Florissant, MO 63031 BUYING AND SELLING CSA and Obsolete Notes CSA Bonds, Stocks & Financial Items 60-Page Catalog for $5.00 Refundable with Order HUGH SHULL ANA-LM SPMC LM 6 SCNA P.O. Box 2522, Lexington, SC 29071 BRNA PCDA CHARTER MBR PH: (803) 996-3660 FAX: (803) 996-4885 FUN PAPER MONEY • July/August 2005 • Whole No. 238 243 "The Match King" -- Both Genius and Swindler The Financial Career of Ivar Kreuger By Don Rocco T HERE IS AN OLD SUPERSTITION THAT SAYS THATthree on a match is unlucky. There are those who ascribe this tooccurrences in World War I: if a match was kept lit for three ciga-rettes, the third person to light up was often killed by an enemy sniper who had spotted the light. There are others, however, who feel that the only one who could have started this superstition would be Ivar Kreuger, who did so in order to sell more matches. Does anyone have a match? Sure you do! In the United States alone the quantity of books of matches distributed free of charge is unimaginable. Add to this the output of wood- en matches, and you can easily see that control of this industry would be very lucrative. Ivar Kreuger apparent- ly realized this in 1913, and with his usual calm logic saw himself controlling the world's supply of matches. Here was a product that everyone used, in good times and bad, and Ivar Kreuger was to become the "The Match King," for at the height of his career between 1927-1930 he controlled, directly or indirectly, three quarters of the world's output of matches. How Ivar Kreuger managed to achieve this phe- nomenal financial success is the story of his life and to describe it fully would take many hours. What we can try to do is to bring out some of the highlights of his career so as to better understand this financial "giant" or some might say "swindler." Ivar Kreuger's road to financial success began at the early age or 20 when he made his first trip to America. 1 Even at this young age, Kreuger had the unusual ability to adapt himself to any type of situation. His first job was as a real estate salesman. He worked for six weeks and finally sold a small lot on which he made a $50 commission. 2 There is a story that during this period he was living with a Dutch family. Ivar Kreuger 1880-1932 A ROVE, Ivar Kreuger in 1896, Z-la lad of sixteen with a passion for cherries, a contempt for money, and no particular brilliance in the studies he had just completed at the Kalmar Grammar School in Sweden, Left, Ivor Kreuger in Brit- ish Militia uniform during his res- taurant-keeping interlude its South Africa in 1954. Below and to the left, Kreuger (seated, left) and his partner Toll (standing) during site early days of his career as a builder in Stockholm. Below and to the right Kreuger leaving the U.S. in Iggo, arriving in imp. Right, Kreuger near the end of his ranter. Left: American.Stpldtsb T.'rwt Exrbegs. It,. A71,1{4114, idirh Excbangt. I 930 (below) 244 July/August 2005 • Whole No. 238 • PAPER MONEY A quaint "Biography Written by the Kodak," photo gallery depicting the life and times of the controversial financial manipulator's career. The previous occupant of his room had been an architect and Kreuger had found in his drawer the incomplete plans for a small house. One evening, a man came to the house asking for the architect explaining that he had prepared some sketches for him for which he was willing to pay fifty dollars. Kreuger told him to come back in a few days, and he would have them ready. His engi- neering background enabled him to finish up the simple sketches and he col- lected the fifty dollars. 3 These abilities to improvise and to make quick deci- sions were to become dominant characteristics in Kreuger's career. Kreuger exhibited amoral character qualities from his youth. In addition to his seeming absence of any sense of "right" and "wrong," he was willing to adopt whatever means were available to reach his ends. 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He never appeared to feel any guilt about what he did. This was true not only as a youth, but even when he was fal- sifying the balance sheet of his huge empire. One of his schoolmates once said It isn't that Kreuger cheated more than the rest of us but that he just did it better". 4 Kreuger made a second trip to America at the age of 31. This trip was more successful, and he got a job with a construction firm in New York. His main task was to go over construction plans to see if there were any errors made in calculation. For this, he was paid fifty cents an hour. He did well at this job, and soon won a promotion for discovering a vital error in a set of plans. 5 Kreuger was fascinated at this point in his life with the organization and methods of big business. He visited the stock exchange and noted its oper- ation carefully. He studied the history of the Rockefeller Oil Trust and read biographies of such men as Daniel Drew, Jay Gould and Commodore Vanderbilt. A Swedish friend, of that period, recalled that while visiting him Kreuger used to speak about the importance of winning confidence in business relation- ships. Kreuger developed an almost hypnotic influence over people, and applied it sometimes ruthlessly to gain his own ends. Yet at times, he also seemed to derive great pleasure from going out of his way to help others. Once when a position was offered to him in England, he turned it clown and got the job for a friend of his. 6 In 1903, he got a sub-contracting job in South Africa, a place he was attracted to chiefly by the romance of it, and the reports of good speculative opportunities. With the three hundred pounds that he had, he opened a restau- rant and made a success of it. He also made about 1500 pounds in a gold spec- ulation. 7 Late in 1905, Kreuger returned to America for the third time, and after several job offers was hired by the Consolidated Engineering Company. In this Kreuger & Toll stock certificate depicting Promethus stealing fire from the gods and bringing it to benefit mankind. Imprint: American Bank Note Co. B-AKTIE ( KREUGER (5( TOLL COMPANY) .copporuk1C0 ACCORDING TOME LAWS OA SWEDEN *Ammon.. iow rAnetLAI. t wL omier. A. Ma 0.0. A. 01 ,... IN TWO 0VANI OZN ...110 1 wor. Ito ...Amon. V 1.1. ANTIZA Amy Lotsrlio.t. ■ ALLA wva,■tm. 141%"cs%....;1. raW.N.: ....*:1;11.174'' :0 WM.,. AV it. ...IN. ANTI. ...irr .1. TNz 'A- a. 3.1.60.„,..... ZNA.,117 ..T .. 1.11111.„..51•011..n.r•••■•• • VIM MR MUM AL, TA. • • theopiliA,n volt elatwvws,A048 Oita 4011appit voos som tilrfu iitbetah belappet fôr 14- '2V B.aktie i Aktiebolaget Kreuger & med 100 kronor, tillfarsakras having paid in full th ONE "B" Share of 100 Swedish Crowns in the Kreuger & Toll Company 109 Swedish Crowns Holder of tlr, mPanT r 4-. • NOVAeYV bi u MA. ZOO rnlat.n.. gm"mla ms• ma *Just oaarvtnurt is NOT LIMO.... *VOW purr... NM Lawn onn• .04T RIseammusvx ww. awrAmew a* MRS IN• Mt. OM Warn-tn.. .ax IVIN 1■171.10.. sery• •ertm. sow &AN vtaaroWw.... Moms. 07.... 71. Ne7 Ni Ve. LI.. 70 ANT 0.7.4TION• TMANZI...0 • •00 NB NOT 1 WY... . T1. RRRRR TO 1.1.1701•0ZeTtN.T.M.A.0 .0 at •••••..• 7177.01 .00.110.1..•11.11/10.11 DV. .00.10 PM 01.0- July/August 2005 • Whole No. 238 • PAPER MONEY246 A stock certificate issued by Kreuger & Toll, Inc. in 1928. role, he was chief engineer in the construction of New York's Flatiron Building, as well as the Plaza and other hotels. In some of their constructions they began to use reinforced concrete, a new type of building foundation requiring a special kind of steel invented and patented by Julian Kahn. When Kreuger visited Kahn, Kahn developed a liking for him and suggested that Kreuger should explore the possibilities of applying the new building methods in Europe. 8 On May 18, 1908, Kreuger started a partnership with Paul Toll, who was also interested in introducing the new building material to Europe. The firm of Kreuger and Toll had a total capitalization of $2,500. The new building technique caught on very rapidly, and within four years Kreuger and Toll had gained a rep- utation as the best building company in Sweden. 9 From here on, the pace of Kreuger's life quickened. In 1913 after much delib- eration he accepted an offer by certain Swedish bankers to become President of the United Match factories, which con- sisted of nine match plants. Kreuger undoubtedly realized from the beginning the possibilities of gaining control of much more than just the Swedish match industry. 10 Kreuger made an immediate stir in the match business just as he had in con- struction. The Trust was capitalized at one million dollars. Immediately he went to work to build the trust into a smoothly operating organization. In three years he developed this company into an organiza- tion which cleared a half million and declared a 12% dividend. He then pulled off a merger with another large Swedish match combine. The new company was called the Swedish Match Company. Kreuger had been so persuasive in arguing for the merger that he had man- aged to overvalue the shares of his trust and, in effect, his smaller company swallowed the larger. This was his first big venture in inflating values, which henceforth was to become his prime tactic. His old company, Kreuger and Toll, was now split in two. Half was Kreuger and Toll construction, while the other Kreuger and Toll, Inc. became a diverse financial holding company, that in reality was a pyramid scheme which could be used any way Kreuger wanted. The capitalization of Kreuger and Toll had grown to five million. The interrelation of Kreuger and Toll and the Swedish Match Company began when Kreuger transferred 120,000 shares of Swedish Match Company (1/4 of the total) to Kreuger and Toll, crediting Swedish Match two million for them. 11 The state of disruption in the world market following World War I gave Kreuger the opportunity to expand in Europe. In Belgium, Austria, Finland, Switzerland and most other European countries, Kreuger bought control, usu- PAPER MONEY • July/August 2005 • Whole No. 238 247 ally directly, of the leading match companies. Although the profits of his main company, the Swedish Match Company, remained the same during this period, the name of Ivar Kreuger was rapidly becoming known. Almost over-night an unknown Swede of 40 had become one of the new breed of European master industrialists. During this period of his emergence as a business giant, Kreuger was also successfully speculating in many private deals. In 1918 he speculated in the dol- lar, and this brought him a two to three million dollar profit. During this same post-war period, he bought control of a German chemical concern which two years later was merged into the huge I.G. Farben Trust. Kreuger got approxi- mately fifteen times his investment in this company. 12 , 13 Kreuger's accounting practices were, to put it mildly, unconventional. His essential philosophy of accounting was that a balance sheet existed mainly to paint pictures for the public. He had an almost poetic approach to annual reports. He usually wrote them himself, and he believed that the function of figures was not to reproduce a situation as it existed but to create an impression of it as he wished to portray it. His basic theory was that neither events nor cycles should retard progress. Rising profits -- whether they existed or not --accompanied by ever soaring dividends -- even if they came out of capital -- were necessary in order to keep the customers happy and the credit coming. As part of this policy, he believed in secrecy in his operations and in the books or his company. So many of the pertinent figures relating to his operations were kept in his head that he juggled them and used them as needed. Only his phenomenal memory enabled him to get away with this practice. In line with this secrecy, Kreuger found it neces- sary to hire accountants who were unquestionably loyal to him alone. He usually selected men who were almost totally ignorant of professional accounting practices. 14 During the period of 1919-1929, Kreuger continued to expand his operations. During this time he raised roughly $650 million dollars mostly from securities he floated and partly from loans from banks. Most of the investments in these securities came from American investors who were only too happy to hop on the Ivar Kreuger bandwagon. During these booming pre-Depression years, Kreuger over- extended himself to the tune of about $200 million, for at the time or his death by suicide in 1932, the net assets of his companies came to but $200 million dollars which was half of what the statements he drew for them were claiming. The shrinkage was due in part to the low market value of 1932, but most of it was the result of Kreuger's having paid large dividends out of capital for so many years. Many of the millions he got his hands on simply disappeared and were never traced. Apparently a good part of the money he squandered by spec- ulating in the market at a time when the market was sinking to an all time low. This was one of his last futile attempts to extricate himself from the mess he had created. Finally a good portion of these millions were doled out as bribes to public officials in countries where Kreuger was already selling matches or where he hoped to sell them in the future. The ones who lost the most when Kreuger died and his gigantic fraud was discovered were the ones who trusted him the most: the partners of the firm of Lee, Higgenson and Company who were responsible for the sale of the various Kreuger securities in the United States. These men had trusted him to the extent that until the very end they accepted his word for everything. All of Below: "The Match King." his statements and reports were accepted as gospel, and no investigation was ever carried out by them. Also on the losing end were the small investors in Europe and America who looked at Kreuger as the genius who could do no wrong. A Fortune magazine investigation turned up fake Italian bonds, which were among the "props" Ivar Kreuger had used to bolster his paper financial empire prior to his crash. Princeton University houses an archives of doc- umentary evidence tracing the rise and fall of the worldwide Kreuger corporate pyramid scheme. I; t I. ! 1 ,l lq Ili•, • I • • '; ,."..-r . .....t.....t.:- • ..........x.._, 2-' • '7... ...-..Ai ri • AMMINISTRAZIONE AUTONOMA DEI MONOPOLI DI STATO , I k ;44 ... . . 14/41wie, k ,047 ros:,../ d,.., 41 . Ai ilf."•/.4., ',€2..../ rid: Yaliew . I' /....f..”./die,.._ - ••••■ hi . 1.....0,44 /AO ., . • IL DIR TORE ENERALE ••..-. -7- . 7.--. 7....----.-;.-:-..7:- 7..7-- 7-:-...-z-..-rl. -:7z7-,.-; .77...-7.-.:-.-...-- -..:-...,.:.77. -.7...?. Lee, Higgenson and Company, who were so taken in by Kreuger, were no different from any other banking and investment house of that day. Anything that worked was good business. This included mysterious foreign subsidiaries that were set up in quaint pocket- book countries to avoid taxes, which everyone was trying to do, and managerial secretiveness, loose company laws, and lax accounting prac- tices at home and abroad. It would seem that bankers should at least have been aware of the extent to which Kreuger was weakening his organization by buying up his own unsold securities, but even that was fairly common practice. Kreuger was playing the old Ponzi game -- paying dividends out of capital and trusting to more capital to keep the ball rolling. 15 None of this is an excuse for what happened; it simply serves to place Kreuger in his time, but because his turned out to be the biggest swin- dle, Kreuger became the greatest object lesson which largely led to the subsequent reform in accounting and company direction both in the United States and in Sweden. Ivar Kreuger died by his own hand on Saturday, March 12, 1932, at his home, Numero Cinq Avenue Victor Emmauel III, in Paris. The Swedish Match Company, which he created, is today alive and quite well. So, the next time you strike a match, think of Ivar Kreuger -- both the genius and the swindler. REFERENCES 1. MacLeish, Archibald, "The Times Were Right for Ivar Kreuger," Fortune, Volume 101, February 11, 1980, pg. 58-72. 2. Stoneman, William H, The Life and Death of Ivar Kreuger, The Bobbs-Merrill Company, Indianapolis, 1932, pg. 46. 3. Churchill, Allen, The Incredible Ivar Kreuger, Rinehart & Company, Inc., New York, 1957, pg. 47. 4. Churchill, pg. 29. 5. Churchill, pg. 54. 6. Churchill, pg. 55. 7. Churchill, pgs. 54-56. 8. Churchill, pgs. 57-59. 9. Sparling, Earl, Kreuger's Billion Dollar Bubble, Greenberg Publishers, Inc., New York, 1932, pgs. 112-129. 10. Shaplen, Robert, Kreuger, Genius and Swindler, Alfred A. Knopf, New York, 1960, pgs. 39-41. 11. MacLeish, pgs. 60-64. 12. Shaplen, pgs. 44-50. 13. MacLeish, pg. 64. 14. Wantoch, Hans, Magnificent Money -Makers, Desmond Harmsworth, London, 1932, pgs. 242-256. 15. MacLeish, pgs. 60-66. 248 July/August 2005 • Whole No. 238 • PAPER MONEY PAPER MONEY • July/August 2005 • Whole No. 238 249 Financing the French Panama Canal A Portfolio By Joaquin Gil del Real Introduction p ANAMA IS GEOGRAPHICALLY ONE OF THE MOST strategic regions on earth. Because of this, she has been a prize for competing global interests for the past five millenia. Almost as long, the creation of a short sea route connecting the Atlantic and Pacific Oceans has been the dream of governments, financiers and commoners alike. Eventually the United States government stepped forward with money, materiel and manpower to complete the Canal, thus securing for this country its seat at the table of global power. Before then, however, the venture already had a long history, so it's not surprising that a chronicling of the financ- ing of that dream's eventual realization would be of genuine interest to a broad cross-section of paper money and scrip collectors from Panama to the States to Europe and the Far East. Leslie M. Shaw, United States Secretary of the Treasury, signing the check purchasing French Canal assets in Panama and putting the United States gov- ernment in the Panama Canal building business. The Isthmus of Panama is a narrow, curved strip of land going east to west, cover- ing 29,157 square miles. It is bordered on the north by the Caribbean Sea and on the south by the Pacific Ocean. The coastline extends some 720 miles in the north and 1050 miles in the south. In the west it is bordered by Costa Rica and in the east by Colombia. Width ranges from 50 miles to 150. Average rainfall May to December ranges between 60-110 inches in the Caribbean coast and 45 —90 inch- 250 July/August 2005 • Whole No. 238 • PAPER MONEY Treasury Warrant of the United States Treasury for $40,000,000 to J.P. Morgan Special Disbursing Agent for purchase of Panama French Canal assets, signed by Leslie M. Shaw, Secretary of the Treasury, May 9, 1904. This is the warrant Shaw is shown signing on the previous page. Ferdinand de Lesseps 1805-1894 es in the Pacific. It is hot, humid and quite tropical. 1 Known primarily for its Canal, most people are surprised to learn that the Canal does not lie east to west, but rather northwest to southeast. The Isthmus was first explored by Rodrigo de Bastidas in 1501. Columbus landed on the north coast the following year. On September 25th, 1513, Vasco Nunez de Balboa discovered the Pacific Ocean, and in his report to King Ferdinand he recommended a fortified trail from ocean to ocean. He added as an afterthought that one Alvaro de Saavedra, who made the crossing with him, had suggested that a strait connecting the two oceans should be sought. 2 In 1527 Hernando de la Serna and Pablo Corzo explored the Chagres River. The following year Antonio de Galvao and Francisco Lopez de Gomara named the Ithmus of Tehuantepec, Nicaragua and Panama as sites for the construction of an interoceanic canal. 3 There would be many more references regarding a canal. It would be more than three centuries, however, before advances in science and technology would make thoughts of an interoceanic canal more than a dream. Unprecedented advances were shrinking the globe. The first transatlantic cable was inaugurated on July 28, 1858; the first transcontinental cable on October 25, 1861. The first safety elevator had been invent- ed by Otis in 1853, and the Gatling gun in 1862. Great engineering prowess had been accom- plished. The transcontinental railroad in the United States was completed on May 10, 1869. The Suez Canal was inaugurated in November of the same year, and in December of the following year a seven mile tunnel cut through the Alps con- necting Switzerland and France. 4 What else of such grandeur was left? Count Ferdinand de Lesseps: Man of Vision - Man of Action By the last quarter of the 19th Century, geography was the fashion, and the Societe de Geographic de Paris was a favorite meeting place for the men of position. In summer of MYLAR D® CURRENCY HOLDERS PRICED AS FOLLOWS BANK NOTE AND CHECK HOLDERS SIZE INCHES 50 100 500 1000 Fractional 4-3/4" x 2-1/4" $20.50 $37.00 $165.00 $290.00 Colonial 5-1/2" x 3-1/16" $21.00 $38.50 $175.00 $320.00 Small Currency 6-5/8" x 2-7/8" $21.50 $41.00 $182.00 $340.00 Large Currency 7-7/8" x 3-1/2" $24.00 $45.00 $200.00 $375.00 Auction 9 x 3-3/4" $26.50 $48.00 $235.00 $410.00 Foreign Currency 8 x 5 $30.00 $55.00 $250.00 $440.00 Checks 9-5/8 x 4-1/4 1 ' $30.00 $55.00 $250.00 $440.00 SHEET HOLDERS SIZE INCHES 10 50 100 250 Obsolete Sheet End Open 8 3/4" x 14 1 /2" $18.00 $80.00 $140.00 $325.00 National Sheet Side Open 8 1/2" x 17 1/2" $19.00 $85.00 $150.00 $345.00 Stock Certificate End Open 9'h" x 12 '/2" $17.50 $75.00 $135.00 $315.00 Map & Bond Size End Open 18" x 24" $70.00 $315.00 $570.00 $1295.00 You may assort note holders for best price (min. 50 pcs. one size). You may assort sheet holders for best price (min. 5 pcs. one size) (min. 10 pcs. total). SHIPPING IN THE U.S. (PARCEL POST) FREE OF CHARGE Mylar D® is a Registered Trademark of the Dupont Corporation. This also applies to uncoated archival quality Mylar® Type D by the Dupont Corp. or the equivalent material by ICI Industries Corp. Melinex Type 516. DENLY'S OF BOSTON P.O. Box 51010, Boston, MA 02205 • 617-482-8477 ORDERS ONLY: 800-HI-DENLY • FAX 617-357-8163 PAPER MONEY • July/August 2005 • Whole No. 238 251 THE ISTHMIAN COLLECTORS CLUB (ICC) IScelebrating its 30th anniversary this year. Originally founded on Panama Canal Day, August 15, 1975, as a stamp club, it has evolved through the years into a true "collectors" group. ICC is devoted to spreading the "gospel" on all manner of Panama and Canal Zone collectibles. Members' interests range from paper money, coins, medals and tokens, to all man- ner of stamp and postal history, as well as picture postcards, books and mementos of the construction of the Canal and the country. With an international membership of nearly 200, the ICC welcomes those interested in any aspect of isthmian col- lectible. Dues are a modest $8 per calendar year for U.S. addresses. Members receive 10 issues of an 8-10 page newslet- I Collect FLORIDA Obsolete Currency National Currency State & Territorial Issues Scrip Bonds Ron Venice 4452 Deer Trail Blvd. Sarasota, FL 34238 941 927 8765 ter ICC Journal via first class mail. In a recent issue of the journal, its Editor paid high accolades to SPMC member Joaquin Gil del Real, calling Society member and frequent Paper Money contributor Joaquin "perhaps the greatest expert on Panama paper money ... and a recognized chronicler of local history with a long list of pubished articles to his credit." The issue also included articles on divided and undivid- ed back postcards, spurious Panama railroad tickets (an updat- ed version will appear in a future issue of Paper Money), night- club, bar and entertainment collectibles, a postal cover, news and advertising. For more information contact ICC Journal Editor Bob Karrer at 17 Wentworth St. Charleston, SC 29401-1625 or email at . 252 July/August 2005 • Whole No. 238 • PAPER MONEY 1i0tiyetE eletablis sitivans steles passes les on Oclobre eg NoventbrejeSty, of deposes ea l'elude Or tif• CHA AfrETIER DE RITES, S Puri, 4723 po oAYITBL SOO:LA.1, 307000,000 nrc P`1245.-ZSCIES 0540'6' l'"A 't'ljti:"4 17111,4- cr. E.0coned(100,,000 l500 Ude,. ettaCtlee PAR : DE FO DAT. UR AU .P LE PRESENT TITRE DONNE DROIT cif one part de. Tin Neuf Alitheme dans les Quints pour ,97ent, C,4 dust:Fogdateu nes ”Arurs) or les produits nets nu Nnefices de rEntreprise. UN DIAINISIRATLU Ft, .r.41. ,r xi •x• a , 7.1:,,57 `1: 1 tA e' ' 'NtkUT■!er'rTi7M7,i ':=,N21L'Igspgr,ht 1 t 7 er:1# Pii ; /conked r to Conceit &administration 'ro .41.0-; I oul'','■11. om do „do,,moo id d edda l 6 po Les Actions venni. alaurout drui qu'S la portion du , , drvene exnt e ur roo mu espitalm ciulmIg , : ! aura ad remboursi, tout re au procaine 5 ojo do icur i 5 pour too du capital retalrourad," sera scrod au fond a qui sera dit , ellam,rortoissentnat /lentil edam question sous Particle 63 nt partaad a , pan aAar. 66 La ttribuic Eunae 15:114. ficlaices deSiglItS WU Panicle 7aux el.d d essu tu a" 61 ou 00 . benefices annuels de 'neomycin . reprarontic par rircs ddsignes : dor till. speciaus dant lo Conseil &administration determine le roturc'et la forme. EnEn none ins prisenre Statute stiputerout ciropres,dl c per ILL reserves y "Waldo au profit duo dircraes peracilvies dont les ropitaux et la cotinours auront serui Is dein. de Is prorote &nitro, oro "It■:!.00Leeprod I de 14 p ‘1rourd dacqU Panicinon stipulde see profit par lc goineraement des Etats-Unia de Colombic aux termes de la loi de concession; Ids depeascs Wen treticn et d'explointion, Ica frals d'ecinuel,eation e =1;tifsTaTcalc'g Cgpr'll'n'tnutaV:Peiati Tatte 'd cor arectes; antra cenUemcs peur cont du capital rocia applyable au Conde dlunontss 'em nt conautue sou I al G3 ciropolf; Is proltrementd'ne vroptieme au "x• as* a - B les benefic , a .pa , flf ga= , Anr g ,l -ifl-VesPO' 7: d? ' beneft Plr .AUVai ?tud21 capital et par p t clorou aq tcro .f tootetals P Pod , as Le t surolums ores ,rotecnt eta "ro 'ce„t„ aux It 1 15 ?our loop ani Pen Figure A. Founders Share: yellow/brown, 9,000 issued, 270 mm 327 mm. 1875 at an international congress held under the patronage of the Societe, interest in an interoceanic canal across Central America was manifested. The speaker was Ferdinand de Lesseps, conqueror of Suez and France's "National Hero." He declared that two issues on this matter needed to be solved. First: to determine what was the best route; and second: what type of canal, sea level or with locks. Several explorers presented their experiences and reports were presented on American expeditions to Nicaragua. Since 1870, the United States had surveyed both Nicaragua and Panama, and had preferred the Nicaraguan route. 5 In 1875 Ferdinand de Lesseps was 75 years old, in good health and great- ly admired. The Suez Canal in which he had been instrumental had been financed by France (through thousands of small investors) and Egypt. The Frenchman was neither an engineer nor a financier, but was the driving spirit of the enterprise. Upon completion, he occupied the position of Chairman and President of the Suez Canal Company. Referred to as "The Great Frenchman," he was thought to be able to accomplish anything. Within several years, England, guided by the Rothschild Banking house, acquired financial control of the Suez Canal, thereby protecting its overseas empire in the East. De Lesseps, although still head of the company, saw his influence greatly reduced. His "enterprise," the pride of the French people, had suddenly become British. 6 During this period the American Interoceanic Canal Commission pub- lished its decision of favoring a canal in Nicaragua. Panama was barely men- tioned. Shortly thereafter, the Societe Geographic announced it would spon- STERN. Gra r. FARIS. KJZPASNI GUATUAISI AUSTRAUE AV4P1CMG BF LC CL, PAU 1130.1511.1 P CHILI ti %CAME'S ' GLSTAR■G•A ORGIUAARA .1:1ATZOR yule i•ORPL• Rota GUATINAVI NORCURAIS Pt MOTH 111”0 ,110 etre, . ERSCLLE t „ , • le) E IIKARAGUA OPMCZ PAYS-BAS 001nauw PORTUGAL ALS. Staltd9 &poses charim DETIfiEsWbkuie dikis les 20 Clabbre et 29 Novembre 1560. CiiintaiSodiAt Inniin__,_00,000 DE rRANCS DIVISt EN 600.000 ACTIONS DE soo FRANCS. ction de entA cents' .franz au LIBtREE DE DEUX CENT CINQUANTE 02 00.4. • f 111."714 '0105 009ktwillr 1, '0'", • Pr ciAptfort : I "A' 0 YecAiridlid-Diarteur. ig,k6e YJn ,Weltninistratrar:r SirlAGAVAPSALVAGOP a au totx t1V0QUIC URUGUAY. VIKALUA • '1.0/0 CSPAGNE EGCUPS caLommt MILK'S% untl.tiC ■FPAHCO 73 . IT4'1‘ priv, mg!.zi.d41 V.Ju..r>f: Ceti des a la So mais el actions TROISIEME VERSEMENT Action_,; NTIERA ille actions (noo civile, Facut e n'a droit qu'a un r portant les numaros ENT LIB 10,000) qut n de i'artiol venu egal 0,001 a SOO OURTRItmE VERSEMENT paxtigt rembnis celui des autres 00q. PAPER MONEY • July/August 2005 • Whole No. 238 253 17,0 011004, 1pou.- ur.cul,. 1 , I VI. — .2 , 17•'• sor an International Congress so as to evaluate the building of a Central American canal. 7 Concurrently the Turr Syndicate was formed, whose official title was Societe Civile Internationale du Canal Interoceanique du Darien. It was a small syndicate that included well known figures, strictly for profit and made itself available to the Societe for exploration, survey and all matters perti- nent to the consideration of the canal. Lieutenants Lucien Napoleon Bonaparte Wyse and Armand Reclus were dispatched to survey a possible route in Panama for a canal. While there, Wyse went to Bogota and negotiated a concession from the Colombian government. Their so-called survey was no more than a perfunctory exercise, and what was presented to De Lesseps in Paris was a sea level canal that basically followed the route occupied by the Panama Rail Road. 8 The Congress International d'Etudes du Canal Interoceanique convened in Paris in May of 1879 hosting leading engineers, explorers, economists and naval officers, in all some 136 delegates. All the invitations had been personally issued by De Lesseps himself, so not surprisingly it was heavy with Frenchmen who numbered 73. The most important committee, the Technical Committee, was personally chaired by De Lesseps himself, and of the 52 delegates assigned to it more than half were French. To make matters short and clear, it was a committee of one: De Lesseps. Of all the reports made, most were serious presentations by people who had garnered their information and experience in the field. None was seriously Figure B. Founders Common Share: blue, only 10,000 issued, 210 mm X 403 mm. allisilumw.. tiii ve!is 254 July/August 2005 • Whole No. 238 • PAPER MONEY p P. CotlifT4 tAMnLLEli USTIMUE Altritiemt atZIOut iseuvitt STEFIN .Grave,r. PARIS !.) 40C,i) f. Ar7 7,1,71 re 'I V,I.(CAT11. 1p,T, )7, 7)71.A?„) .„, nifast)g vensEmteit 4ift 'aut., C17: L.(1111:1L. Mr AU IrCAPASLIA NM. nz rwa 84 s! r2 ?IMO,RUSt Figure C. Common Share: blue, 590,000 issue, 210 mm X 403 mm. considered other than the Wyse Report, which came up short on facts. After a week of behind-the-scenes maneuvering, a vote on Panama (Wyse) or Nicaragua (American) was taken and the Panama route was chosen. The Wyse route was the French route. De Lesseps had made himself felt, and he had had his own way. 9 Shortly thereafter De Lesseps organized a private syndicate of rich friends and bought out the Turr Syndicate (Wyse concession) for $2,000,000. This group was to be considered the "Founders" group, which was to receive "Founders" shares at bargain prices, plus many other benefits once a company was legally organized. This company would be tasked to build the Panama Canal. The Compagnie Universalle du Canal Interoceanique de Panama was incorporated on March 3, 1879. In August of that same year, the company independently offered its shares to the public in Europe and America. The offering was a failure, much to the surprise of De Lesseps. Later that same month, all money was returned. (There are no known certificates of this offer- ing.) Examining the reasons for this failure led to the conclusion that — in com- mon jargon — "the rails had not been properly greased." 10 Having corrected the shortcomings of their initial efforts, in October/November 1880 the Compagnie again offered 590,000 shares of com- mon stock. The first 10,000 were reserved for the "Founders" group. This offering was a grandiose success. The issue was oversubscribed to double the amount available. The French masses had put their hands into their savings so PAPER MONEY • July/August 2005 • Whole No. 238 255 Smithsonian Curator Dr. Richard Doty Calls Our Attention to Another Keatinge & Ball Note Anomaly O NE OF PAPER MONEY'S PRINC1-pal goals is to serve as a "marketplace" of ideas, discoveries, information exchange, etc. and to record these tidbits for posterity -- to put them on record for today's collec- tors and those a 100 years from now. That's why we have regular items like "Research Exchange," and that's also why Reader Feedback is so important. The late Brent Hughes "kicked off' this "treasure hunt" message string when we published his article (posthumously) on CSA printers Keatinge & Ball's private notes in our Jan/Feb 2005 issue. Hughes, "Mr. Confederate," was wise enough to know that many collaborators on an enigmatic subject make for better research and challenged members to put on record additional data on these enigmatic K&B notes. He asked for reports of # data. Last issue Bryn Korn and Les Lewis did just that, prompting Dick Doty's query. What's going on?, Dick wonders. SI's $2 K&B note No. 3, Plate A (above) is the same as one of those shown last issue in Ms Korn's possession. Any ideas or higher #s to report? Announcing the Confederate Paper Money Condition Census Project •Building a census and provenance of the top CSA currency rare varieties. •Updates to be published as supple- ments to new Collecting Confederate Paper Money book by Pierre Fricke. •Do you want to be remembered 100 years from now by future collectors? •Privacy and anonymity maintained at your request. Long time rarity and variety collector (32 years) — U.S. Large Cents, Bust Halves, now CSA paper money and bonds. Member EAC, JRCS, SPMC. From long time Louisiana family. Please write to - Pierre Fricke, P.O. Box 245, Rye, NY 10580 ; ; eBay — "armynova" WANTED: NATIONAL BANK NOTES Buying and Selling Nationals from all states. Price lists are not available. Please send your want list. Paying collector prices for better California notes! WILLIAM LITT P.O. BOX 6778 San Mateo, California 94403 (650) 458-8842 Fax: (650) 458-8843 E-mail: Member SPMC, PCDA, ANA NPANE4P4 UtvA OUR 334 INEQU ICI URU CUM. 41Ntturut NC ENSURER COLD MINS WELPAMPE FRANCO C^M Ntt ivrRs c124.2 ulpos4701;• I a1,8 I 0 e •Socièlei ..7tiorzyme- C tviiss::114414c**5(:7?00 110]:;327 Autoristte paiY AI SmbldeYdivbrale du 29 43.411 •ationSINATEuicENTs,t fillies 54 Ramboursable au pair art Anneos: AUSTRAUI AUTKTCU C a ttcIQ u t a°uv!E l • aets iu tsmai RCN g CIINA11■CA OAR JOE quAYPEA CCYPEC • NEAT CIE 4 CAPAPAIA EAAIN PAYE SAW 3• govIS PR R saig 5TERN Gravevr. MILS. IttiT*122214743 ip*Saida►scit le IS Jaille1 1.1813 obt Cava. , COMMON ritiOrraRiELIA 8 CANAL. 011011101011E DE DAM OBLNATION ielget811, - Coupon dir31110:804eds4avit Is 15 danvfer .11198 *DAL INTENCEAVIQUE: :PAIIIIIA OBLIGA11014 11° 111122CMIk. - Coupon de 12 fr. GO Cchierne is 15 JuIllet 11191 ice r intiVirSilm—m Will tit A DE MINA OBLIGATI...d:11° MIAMI& Caapan de 12 re:diedefibant le 15 lin-vier INT VONYPAGNitt 4:NIVNIU3ELLN 26ANNIE tNIVERHELLII YE• tAllki4l:111178011411101JE .DE,i'AtthMA , oilkfavrioN Coupon 4. gidilIVINfidhditan 1111, eo i891f ..: 256 July/August 2005 • Whole No. 238 • PAPER MONEY Figure D. First Bond Issue: rouge with black lettering, 250,000 issued, used to buy Panama Rail Road, September 1883. as to participate in the project for a greater France led by none other than the "Great Frenchman" Ferdinand de Lesseps. Allotment of shares was made to 102,230 applicants, of whom 16,000 were women. Eighty-two percent of the issue was absorbed in France. 11 Upon examination, the Wyse Concession was valueless unless permission was obtained from the Panama Rail Road to use its right-of-way. Trenor William Park, a lawyer and President of the Panama Rail Road (and owner of 15,000 shares) was no slouch. The lightly built Park had the physical appear- ance of a young adolescent, however he was a "robber baron" of the first mag- nitude and he bushwhacked De Lesseps. Park knew that De Lesseps had to have the railroad, and so offered it in 1879 for $200 a share. This offer was rejected by De Lesseps since the shares were selling below $150 a share. 12 Times do change, however, and on June 29, 1882, at the annual shareholders meeting, the following bond issues were approved: 1. Bond Issue of 250,000 bonds of 500 francs at 5% so as to buy the Panama Rail Road; 2. Bond Issue of 600,000 bonds of 500 francs at 3% for working capital; and 3. Bond Issue of 387,387 bonds at 4% also for working capital. ,;,PMG 7÷--- PAPER MONEY • July/August 2005 • Whole No. 238 257 • BUY, SET ,L & COLLECT A R IN A WORLD THAT'Srpu AND JUST AUTHENTICATION EXPERT GRADING ENCAPSULATION IMAGING INTEGRITY IMPARTIALITY Certification. Standardization. Protection. Professional and impartial paper money grading and encapsulation gives you a collecting environment that is stable, liquid and free of fraud. Paper Money Guaranty (PMG), the newest independent member of the Certified Collectibles Group (CCG), combines accurate, impartial and knowledgeable graders with proven processes and standards for the care and evaluation of your notes. Many of these standards have been established for years at our independent affiliated company, Numismatic Guaranty Corporation (NGC), the largest, most respected company in the authentication and grading of rare coins. And, as with coins, each of our paper money experts is prohibited from buying and selling notes to ensure impartiality. Most importantly, behind it all is the passion and respect for the hobby that we bring to work with us each and every day. To learn more about PMG, contact your local dealer, visit , or contact Glen Jorde, Grading Finalizer, at 877-PMG-5570. 1,43MG PAPER MONEY GUARANTY LAI ...., hic4 64.,....., ril mi, . cot.i!! : ..,,t_21. ? s ELF. sim'eal I!. 1 1 . * mi. . ". - - 7-111 „ ‘ 1 en'ill- • A, LA VA*_., • II ,I. . , Iv, c At '.:,...:4:■ .., t . : .1, I r• MI*1•11111 I AI?... a le' ... i I — j ORrsi ""I'VrAwn•II‘ttiitif. 0.- ,,.. i IQ_ 300.000M irA .0 00 a "tt4, IA°- wuulAi.: IOX DZ GO O. 60 0 ,OBLIGATI „ , riSOO par l'Avusin1,160 Gertoitte*ts Jukrt 1882. f i i A ON de ernbousable au pair en Anne() ..-, 0,248,9 .g 5 -PARIS. le 1•' octabra 1384 leilesiden rtrieur• —,-;,..91 j.G .1 ANTIa;OGRTEPa A . ge... div STERN. GraVeLr. PARIS Rut RACAII 'MMUS RUSTRAU C AUTAI CNC MD QUI. 160t vat SSPAGHC CoutonSDL CCLDM al irnamsti al* ...14 PANCC1 '83E5 •onus 9CN1 N Ei COSMO. 033330( CQUATCVA CCMPit At CANAL INTEROCUNIQUE 133 DE PANAMA OBL/G . N. 0.24 8,985 de 7 fr. 50 felfent le IS IOW AL INTEROC2ANIQUElao DE PANAM ' `""-- °BG. Ne 4124 ” 8 5U 7 0. BO eeheeer le IB acmafig CANAI; fri'i'ElicititiaiMUE 32 . DE PANAMA OBLtc 141,19,24 a 98 5 a.. COUpun ele7 fr, 50 &Vent to 15 OCTEISRE,1800 CANAtiotili_ .*pw"Oreamo glUE1—. Onue. No 04248, 985 t'pgym de 7 fr. 50 AKUSM.W.45..1111110.11099 CANA UNIQUE [31 DrP411,,,144 ' 4,34.11,i0-8 5 t:■•c..7.9 de 7 f 50 taanu le $ . 111thIL 4 CANALOTEROCEANIQUE128 erg PANAMA - Ostic, N4248,985 Oar.. a* 1 15 VW AL 1NTENQOANIQUE 27 DE • PANAMA Onuo. Na Ct$48.995 de17 fr. SO &MtOO le. Ire Hilt OBLIG. Ng Ale 7 fe.. APOITEROCEANNWE 2 PANAMA — 5 1.1444apt b 4fllffIL tRrI 258 July/August 2005 • Whole No. 238 • PAPER MONEY Figure E. Second Bond Issue: green, 600,000 issued, used for working capi- tal, October 1883. The Panama Rail Road, which had cost $7,407,535 was purchased at more than $291 a share, or more than $20 million. The nails in the coffin of the French Panama Canal were beginning to add up: Excessive payments for the Wyse Concession, excessive organizational expenses, and now, for the Panama Rail Road, even before the first shovel of dirt flew. The second bond issue was placed with no problem at all. 13 The third issue was more difficult. Of 387,387 bonds, only 318,245 were initially sub- scribed, and the rest took some 18 months of offering, sometimes at great dis- counts, before they were all placed. Another bond issue authorized in 1885 for 362,613 bonds at 4% was only subscribed for a total of 141,517 bonds. Things were beginning to not go well. That year an uprising took place on the Isthmus. The rebels in Aspinwall (Colon) burned the city, and the fire destroyed the railroad's headquarters and the Compagnie's docking facilities and repair yards. 14 For its next financing, the Compagnie changed its format. Whereas for- merly the bonds had been for 500 francs, they would now be for 1,000 francs. Yi0.00(00*',(1):8 (e.0)ft OD; 4,CAD41,D. (4) r/ ;://///'THE BANKOF ST,>77. 'II fr. /e/i 4/.// .1/ //' 0 00 MISSOURI St. Louis Welcomes You to the 20th Annual National and World Paper Money Convention Thursday-Saturday, November 16-19, 2005 (Free Admission) St. Louis Airport Hotel, 10330 Natural Bridge Road, St. Louis, MO 63134 Rooms $104.00 Call (314) 426-5500 c a • 75 Booth All Paper Money Bourse Area • Lyn Knight Auction • Society Meetings • Educational Programs • Complimentary Airport Shuttle Bourse Applications: Kevin Foley P.O. Box 573 Milwaukee, WI 53201-0573 414-421-3498 E-mail: Show Hours: Wednesday, November 16 2PM-6PM (Professional Preview--$50 Registration Fee) Thursday, November 17 Noon-6 PM Friday, November 18 10AM-6PM Saturday, November 19 10AM-6PM Future Dates: 2006 2007 November 15-18 November 14-17 PAPER MONEY • July/August 2005 • Whole No. 238 259 260 July/August 2005 • Whole No. 238 • PAPER MONEY Figure F. Third Bond Issue: black with black lettering, 387,387 offered; only 318,245 subscribed, September 1884. Ninety-one percent of the "new series" offering of August 6, 1886 (458,802 of the 500,000), bonds offered were subscribed. This near success revitalized the efforts of De Lesseps. 15 In March of 1887, De Lesseps revisited Panama (he had been there in 1879-80). Now he was more tactful, diplomatic, amiable and kind. However, the sixth bond issue (second of the "new series") on September 15, 1887, wit- nessed only a 50% partial sale. Of the 500,000 bonds offered, only 258,887 were subscribed. 16 By now signs of difficulties and problems were manifest. In the seventh bond offering on March 14, 1888, of 350,000 units, only 89,890 were subscribed. 17 By June of 1888 the Canal was being attacked by the press, and there was growing government opposition. The Compagnie requested a government approved lottery bond issue, though without government guarantee, the impli- cation being that the prestige of France was behind it. As previously, the prop- er "rails" were greased, and the required vote obtained. In the lottery bond Cr.n. Mf/4/1•717e. erreeedvetX Alabama Large Size WNW., 7167-"c'" 1.1.0• • • On OranininiOrnrros, „am- 463C4, Aroma' NAti(?).74411. Top Prices Paid David Hollander 406 Viduta Place Huntsville, AL 35801-1059 Nobody pays more than Huntoon for ARIZONA & WYOMING state and territorial Nationals Peter Huntoon P.O. Box 60850 Boulder City, NV 89006 702-294-4143 PAPER MONEY • July/August 2005 • Whole No. 238 261 Dealer reports major obsolete currency theft LAST ISSUE, WHEN AN SPMC MEMBER ALincoln (nut) asked readers for info on this First National Bank of Idaho, Boise City, IT note #130, he (and we) little suspected the informtion we would receive. The collector was asking because the unissued remain- der purported to be a private note by a NATIONAL BANK (the first one in Idaho Territory) which dated from c. 1867 after the laws taxing private circulation had passed. A noted dealer in obsolete currency reports that this very note (#130) in Very Fine condition, as well as three other "major obsoletes" (totalling five figures in value) were stolen from his inventory. They "vanished from our stock, probably at the Baltimore show" earlier this year, he wrote. Thus the request for info now takes on more poignan- cy. A substantial reward is offered; so be on the lookout. Contact the Editor, who will forward info to authorities. + CNA) IK . *1/4".1 t N. r :.+,‘,:.', 41:.i;Vi r'jZt VIZ ITAV 014 NIL '4'4 414'4'7 11I i 11 el I rlfriAlliria IANTIU151 AUSTAAU C AUTRICHE B[1.0.0 801.1V LI • • : No ; • '.. • ' • 0 litrotifidum 013404,, INTEROCERNWE N° 0.4 2 2,4 6 3 t. 0,4:g2,4 , IBBth ILT MC WI • CNITI CI CCSTA (MUM [QUA 11 • W ▪ AWA TORII/EGG IXTZ-MB • 0.000 PORTIJOAt MIMIC 262 July/August 2005 • Whole No. 238 • PAPER MONEY Figure G. Fourth Bond Issue: black with black lettering, 362,613 offered; only 141,517 subscribed, April 1886. issue of June 26, 1888, of two million authorized only 802,119 bonds were sub- scribed. 18 On February 4th, 1889, the Compagnie declared bankruptcy. After the failure a group of investors, interested in the continuation of the project, formed the Societe Internationale D'Etudes for a financial feasibility study to continue the construction of the canal. The study indicated that the financial resources needed to continue and finish the project were enormous and recom- mended to abandon any new efforts. 19 By 1892 the Panama Scandal burst over France. In May the Societe D'Etudes et de Publication pour favoriser L'achevement du Canal de Panama was formed to continue the studies of the previous Society D'Etudes, their objec- tive being to consider the means of liquidation of the works and/or for protect- ing the interests of the shareholders and bondholders. One of the results was the naming of a liquidator and attorney to represent the bondholders. 20 These last mentioned were instrumental in organizing the Compagnie IEARLY AMERICAN HISTORY AUCTIONS Sign Up to Receive Our Fully Illustrated Catalogs Free Online or Only $72 for a Full Year Subscription of Six Bimonthly Printed Catalogs AUTOGRAPHS • COINS • CURRENCY • AMERICANA • MAPS Every Auction Lot is Now Available for Online Viewing... staxiikwEimit , - (114,1,13,--fijEttagggikqUitAtomp Consign Your Important Material • Phone Dana Linett Today! EARLY AMERICAN • P.O. Box 3507 • RANCHO SANTA FE, CA 92067 (858) 759-3290 OR FAX (858) 759-1439 • WANTED 0 In Stock for a Gold, Silver, and Pl Call for Quotes 80 The South's oldest and largest co Top prices paid for all National Bank Notes, Large Inventory of National Bank See Our Website at or el orida onals, ens livery Products 7 3010 op sin ollections, otes for s 1967 d Estates WILLIAM YOUNGE Your Hometown Currency Ilea INC ers 95 South Federal Highway, 3 oca Raton, FL 33432 P.O. Box 177, Boca Raton , L 9-0177 (mailing) (561) 368-7707 (in Forida) • (800) 327-5010 (outside Florida) (800) 826-9713 (Florida) • (561) 394-6084 (Fax) Members of FUN, CSNA, ANA and PNG PAPER MONEY • July/August 2005 • Whole No. 238 263 July/August 2005 • Whole No. 238 • PAPER MONEY _ -41) 11i 11-. iivr ' •••• . 00A04•4•1,117',Z % .1 41 $14 Vw ; z . . - ',""twitlansworar", HIMMUMEnortimestw r, ALLEXASIO (ANTILLIII MIST ALI AUTO ICHt 8 LOIQU I EOUVIL1 [EPA ORPOI•• COLO OIL WM= IS L•0.11111 teOANCII IIIS*1107• SALVADOR ■DU 0 II tit184,8E4 OR COAT VIIISZOCIA • ooze e nonyme- 7911-,41f,139"."9 .; 264 Figure H. Fifth Bond Issue: face value increased to 1,000 francs, beige with black lettering, 500,000 offered and 458,802 subscribed, August 1886. Nouvelle de Canal de Panama on October 31, 1894, to replace the original Compagnie. As such, the original Wyse Concession was extended by the Colombian authorities for another 10 years to October 31, 1904. 21 Some work continued in Panama. United States Completes the Project On November 3rd, 1903, in a bloodless undertaking and with the con- nivance of the United States, Panama separated itself from Colombia. U.S. President Theodore Roosevelt who saw the Canal as a key to this country's exerting its military might worldwide sent war ships to back the coup. The rest is history. On May 4, 1904, the United States purchased all rights to the Canal for $40 million (see pages 249 and 250). The ceremony took place at the offices of the Compagnie in Panama City. Lt. Mark Brooke signed the appro- priate documents on behalf of the United States. 22 rBuying & Selling All Choice to Gem CU Fractional Currency Paying Over Bid Please Call: 916-687-7219 ROB'S COINS & CURRENCY P.O. Box 303 Wilton, CA 95693 TO POSTAGE FRACTIONAL CURRENCY • First new book on Fractional Currency in 25 years. • All the regular issue notes in all 8 grades with the rarity of all the notes. • Four pages in color. • Helpful hints and what to look for. • PCDA Literary Award Winning Book PAPER MONEY • July/August 2005 • Whole No. 238 265 $29.99 & $3.00 S&H 1SCHILI CIIIN 00917,1004 CAPLAMN I.4UAMA Itlent L&PAONI tiA000011 431.0■1014 rAnateAt akeeNe ^A1'AOCP SUIDEN Iver0.1 El u, AY u0A • ..- tit& _IP easyif'7 ,ii I 1 V e w.44 -43.4eivi .; ...79.—mirsv... 7., i 01 toeoW . ai4g, I-L- ArTIM CIAL VA rA,$ • • 1011101004▪ sate[ a MAW MONOUIVi♦ N ilAt • M?ONN Coup de 7 fr. SO 61661,46 iS SEPITIORE I L CANALI INTEROCEAM ,,DE PANAMA iY gi) 081.1.0. N" 134,055Lut Cduport de 7 ir 416/44ant k 15 DECO% E1A 5., CANAL INTEROCEANIQUE 2 6 b E PANAMA 4/1 'OBLIG. N. *434,0 56 Csi Conperm ef. fr 60 erne.. IN IS MARS Mb CANAL INAENOC.EANIGUE DiAlivvrtAm A 4"._i rtr 06IAG. N. J.* w..) Coupon Le 7 tr. SO iehiant tea CAMIANTEROCgANIQUE9 'DE PANAMA "'" Chstm. No 134, 055 Coupon de 7 ,[t 1:4,4zhauls iStErlitillt* CANAL arrnoctwou DE PANAMA e7At. OECEAWIE 18 CANAL INTER0IA1ZN - BE DE PANAMA 4.1.1 no °out, No 0 5 5 itfiThEioct.ANI P. • PANAMA- . Osuq., N. 2 POtrpun de 7 Fr. 80 kellawn 6 de 70, 6044icaut:e 15 Sur STERN Graveur PARIS 266 July/August 2005 • Whole No. 238 • PAPER MONEY Figure I. Sixth Bond Issue: beige with black lettering, 500,000 offered and only 258,887 subscribed, July 1887. There was no need for the private funding of the past as evidenced by the bonds and shares displayed here. The United States Treasury was now financ- ing the Canal project. Many of the assets of the Compagnie, which had contin- ued digging on a very modest scale, were invaluable to the Americans. Lands, bridges, buildings, wharves, piers, waterworks, roads, shipyards, hospitals and much materiel and supplies were rehabilitated and used. All property of the Panama Rail Road was transferred and received by the United States. French dump cars were reused, and dredges were restored. French surveys, studies and engineering were found to be of the best quality and of much use to the Americans. 23 French errors were avoided and much was learned from their mistakes. PAPER MONEY • July/August 2005 • Whole No. 238 267 ght Currency Auctions Deal With Th Leading Auction Co pany in U.S. Currenc 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 ogo 0 Xs. —-.1-11 ,11-1 W13) —.NH 79f2 cazaatra56 w MX:111X2agallbil 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. ,vnJ(niyht Currency Auctions P.O. Box 7364, Overland Park, KS 66207 • 800-243-5211 • 913-338-3779 • Fax 913-338-4754 Email: • PAGNIE UNIVERSE "E * * &&• 11.1• r • _.1 I I a at). • ao, • 41,:, ,,, el Iiivaz•lw7a. .1 lilt %AM •V EEEIETE lifilitntlE AU CAPITAL OE 300 e11Luots 00 RANCE ET SOCUTE CtVILEVANDRTISSEDIEl T pEsOBLIGATIONS DUCANAL DE PANAMA 4.11EaC146marss 6,18,0itresfonab51l16tintiltrAlii Doclite ISS VON DE 350.000 OBLIGATIONS toriPv yopti.giabve 00,04,2 8`ii2:heittetrs85- 3! S Fi I -au riA -7.000-fratu , nil mia-k awaite athelk, etribmir. per de e .. e frane-- oement. rtisserndni, Intrtle 0ii tont ruwai 'ittP:Present *Mint, oat Ur :,101'n .a,alr M. aampeUer de ,flibes It son 0 r.1,6,OP, i Perk- le 3 Mar, . . ,..1* i N° , i 0. -4,WF:. W . , LE ESIDEN1-01AEGTEt 130,411111111STR0TEOR EL D6 Jli , I4V-f.9 al,==.641 44,t4A.4f 4. et:di rrica, 1. 268 July/August 2005 • Whole No. 238 • PAPER MONEY Figure J. Seventh Bond Issue: beige with black lettering, 350,000 offered and 89,890 subscribed, March 1888. The canal was opened to traffic in August of 1914. According to the Canal Museum: "By August 15, 1914, the Panama Canal was officially opened by the passing of the SS Ancon. At the time, no single effort in American history had exacted such a price in dollars or in human life. The American expenditures from 1904 to 1914 totaled $352,000,000, far more than the cost of anything built by the United States Government up to that time. Together the French and American expenditures totaled $639,000,000. It took 34 years from the initial effort in 1880 to actually open the Canal in 1914. It is estimated that over 80,000 persons took part in the construction and that over 30,000 lives were lost in both French and American efforts." The Canal continued in American control until December 31, 1999, when it was turned over to Panama. REFERENCES 1. The New Encyclopedia Britannica, Micropedia, 15th Edition, Vol. 9, Encyclopedia Britannica Inc., 1997. 2. Cameron, Ian, The Impossible Dream, 'William Morrow & Co., New York, 1972, pg. 18. Mack, Gerstle, The Land Divided, Alfred Knopf, New York, 1944, pg. 27. 3. Mack, pgs. 27-28. 4. Kane, Joseph Nathan, Stephen Angovin & Janet Podell, Famous First Facts, The H.W. Wilson Company, New York, 1997. 5. McCullough, David, The Path Between the Seas, Touchstone Books, Simon and Schuster, 1977, pgs. 19-86. 6. Ibid. 7. Marshall, Logan, The Panama Canal, L.T. Myers, 1913, pgs. 91-99. 8. Ibid. A clause in the Colombian concession prohibited any work on the route used by the railroad unless an agreement had been made. Join the Club and Submit Your Currency Directly! PCGS Currency Collectors Club Details* 1-Year Membership (Domestic)...Only $99 1-Year Membership (international)...Only $129 • Whitman's The Official Red Book: A Guide Book of United States Paper Money • Sample note graded by PCGS Currency and preserved in a tamper-evident, sealed holder • Direct Submission Privileges • A voucher for five complimentary Grading Submissions. Turnaround time approximately 15 business days. (All currency must be submitted at the same time.) "Offer subject to change, LIMITED TIME OFFER FOR EXISTING PCGS COLLECTORS CLUB MEMBERS 1-Year Membership for ONLY $79 (Domestic) $109 (International) Offer expires June 30, 2005. Must be postmarked on or before 6/30/05. JOINING THE PCGS CURRENCY COLLECTORS CLUB IS QUICK AND EASY. Enroll by phone (800) 447-8848 • Enroll online at • Enroll by mail or fax using the form below: rIrre" YES! Sign me up and send my Membership Packet! 111 1 YEAR — GOLD MEMBERSHIP $99 (Domestic) $129 (International) q Yes, I am a current PCGS Club member: q Check if new add., !BILLING INFORMATION:I Save Me 520! ONLY 579 wmcoo s109 Name (Offer expires 6/30/05( must be poOrnorked on or before 6/30/05.) Address City State Zip CountryPlease Print: 'METHOD OF PAYMENT:' State q Check enclosed for $ Please make check payable to: PCGS Currency Country q Charge my: q Visa q MasterCard q American Express Credit Card No. If paying by credit card, please provide billing address for card or your order may be delayed. Exp. Date Name on Card: Signature Mall to: PCGS — P.O. Box 9458, NEWPORT BEACH, CA 92658 • (800) 447-8848 • Fax: (949) 833-7660 2005 Collectors Universe. Inc. 508401 - Paper Money 0505 The Official -RED BOOK Wed Stat Mosey CI, tribe Settireler 9/71/110 :rtee,; 1.1 \11,;, 01,1,, - i . '11 . 7. , Federal Currency Complete 1861 to ;Jou, („,„pikdo krtbur L. and Ira S. Vriedberg introdudion and Narrative ky DUCTS A Guide 13ool. o 1 CURRENCY A Division of Collectors Universe Nasdaq: act Name Address City Zip Phone ( E-mail PAPER MONEY • July/August 2005 • Whole No. 238 269 ITRI E , ,tiAhff A PAMIR 0516 RN mnr:i 1869 C09101 WIIIIR[9111111Ilf L[5 HIRES Of PRINONONT SEM PART MIDRAGE 0015 fEVRIE8 1880 4.0 4.• •■•■• f 4 s COMPÁG*IE uriry erts-ELLE DU CANAL I Societe anonytita au capital de. TROIS CENTS MILLION ele Fr soGIETE CIVILE AVEC RESPONSABILITE LIMITEE A LA ICISE SOLI LE POUR L AMORTISSEMENT DES OBLIGATIONS A LOTS DU CANAL DE PAN1UNA, EMIS ETON DU 20 JUIN 1888 EMPRUNT AUTORISE .coNFoRmEmENT , AUX PRESCRIPTIO E LA LOI DU 21 MAI 1836, MAIS SANS , AUCHNE GABANTIE OU .FIE; All BI 1TE DE L'ETAT EMPRUNT DE 720 'mILLIoN LOI DU 8 JOIN '1 . SOUSCRIPTION PUBLIQUE A DEUX MILLI LIGATIONS A LOT e ream 8. 0.. 1.9•08m bermetriellaymn• 1•• 4, cab de cheque onn8a INTEROCEAR. • cictcout.mbin par dm loM an • 400 h1.111, dam Ma • `T A ‘p; 1E REMBOURSEMENT A 400 FRANCS ET LE PAIEMENT OES LOTS SERONT IAA E DE BEVIES FRAN : ou DE TIMES GARANTIS PAR LE GOUVERREE ?PIS TITRE PROWSOIRE 0,4"& la 5ar la aomme de Gm francs, Is Compagnie Universe& do Canal Itiaree DE UNE ont..toavriotr- ,,, Lc complement du capital, suit acio (rains, devra etre versa aux Apoqua4 as" IeA des obligations en tieretuent Ebert., la past de to Ccitipagnit UnivcrsclIc du Co,01 et cella de la SociEs6 d'Asttortissetnent de . , . . . . . cane desniete sotunle taut a cre i assurer le Fitment des lots, et A constiuSerlvtalhal ci1 61 c900. tracts de tomes Ies dons fcgiCitricrent'liberica conicrrtnErnev aux terrael do preepeetus de Pereirlicaryisalas Ra t Paris, le 26 Join i$4E PAR OELENNT1011/ LE PRESICENT•OINECTEllil, R NEGOCIABLE ON IAEINBAE Oil CONSEIL on 10 soettst max, _Ty?' IQUE No 0,158,183 It VERSEMENT OE AS FRANCS tit■oo Nownere 0889 . 391 a1 as v: nfirtql'e :L Yr: n4AY ',Cy stt,fffiT, Quinif uec VERSE/AENT OE 45 FRANCS f as YO Aaa rag 7001! SU 46. taddt. a .1 q. 1.0 505, 08•3, pas „ . ' . 130 co oar Ix S ca. isa5 2 VERSEMENT OE SO FRANC des so, 15 .4aIR ?MS "Ta" :::: ' • IV.. " .113 atr/14 :7,2„ Cedut • i Vert./.. 80 1001 119 3 rear 0 s6,4 44.7- 49134 pow L Comm,I• IiirsT vosmitm-60 FR des "raiiMilk`cicbto :880 dem ID pou.l 00109 .48 18 pour 13 Cam T9.41. 59 18 Rest a GYPTIE ad. 43 Nad 270 July/August 2005 • Whole No. 238 • PAPER MONEY 111MINIPAVP Figure K. Lottery Bond: red on red, 2,000,000 offered and only 802,119 subscribed, June 1888, 249 mm X 345 mm. 9. Ibid. 10. Simon, Marion J., The Panama Affair, Charles Scribner & Sons, New York 1971, pgs. 27-48. 11. Ibid. 12. Bishop, Joseph Bucklin, The Panama Gateway, Charles Scribner & Sons, New York, 1913. 13. Simon, pgs. 54-60. 14. Simon, pgs. 63-68. 15. Simon, pgs. 69-71. 16. Simon, pgs. 72-75. 17. Simon, pgs. 72-75. 18. Simon, pgs. 75-81 19. Bunau -Varilla, Philippe, Panama: The Creation, Destruction and Resurrection, Constable & Co., London, 1913. 20. McCullough, pgs. 240-241. 21. Lindsay, Forbes, Panama and the Canal Today, L.C. Page & Co., Boston, 1910, pgs. 80-82. 22. Castillero, Ernesto J., Juan A. Susto, "Rincon Historico," Mundo Grafico, 13 Mayo 1944, Panama. 23. Lindsay, pgs. 79-82. Editor's Note: The bond and share catalog (figures L, M, N, 0, P) continues on pages 272, 274 and 275 following. INSURANCE For The PaperMoney Collector Your homeowners insurance is rarely enough to cover your collectibles. We have provided economical, dependable collectibles insurance since 1966. • Sample collector rates: $3,000 for $14, $10,000 for $38, $25,000 for $95, $50,000 for $190, $100,000 for $278, $200,000 for $418. Above $200,000, rate is $1.40 per $1,000. •Our insurance carrier is AM Best's rated A+ (Superior). •We insure paper money, paper ephemera, manuscripts, hooks, autographs and scores of other collectibles. "One-stop" service for practically everything you collect. • Replacement value. We use expert/professional help valuing collectible losses. Consumer friendly service: Our office handles your loss—you won't deal with a big insurer who doesn't know collectibles. •Detailed inventory and/or professional appraisal not required. Collectors list items over $5,000, dealers no listing required. • See our website (or call, fax, e-mail us) for full information, including standard exclusions. Collectibles Insurance Agency P.O. Box 1200-PM • Westminster MD 21158 E-Mail: Call Toll Free:1-888-837-9537 • Fax: (410) 876-9233 More Info? Need A Rate Quote? Visit: See the online application and rate quote forms on our websiteotC...1151 mom VISA Buying & Selling Quality Collector Currency • Colonial & Continental Currency • Fractional Currency • Confederate & Southern States Currency • Confederate Bonds • Large Size & Small Size Currency Always BUYING All of the Above Call or Ship for Best Offer Free Pricelist Available Upon Request James Polis 4501 Connecticut Avenue NW Suite 306 Washington, DC 20008 (202) 363-6650 Fax: (202) 363-4712 E-mail: Member: SPMC, FCCB, ANA U.S. CURRENCY Is Buying Everything "Still Paying Top Dollar for Rare Confederate" U.S. Type, Obsoletes, Nationals, and of course, Santa Notes 404-229-7184 U.S. CURRENCY ()A * ft, Box 631250, Irving,TX 75063 ME BER Kent Robertson, owner .tgeb-NitviNtstWilskiisbti#:~iitLkiko 1 PAPER MONEY • July/August 2005 • Whole No. 238 271 •TIMBRE is 11; '3&--.4a4A4.44;;;;;;;1=X-.MI.awzooge.satilgstlriatotaawdVLA • rt O - S -4; July/August 2005 • Whole No. 238 • PAPER MONEY272 N. 0,870,490CE TITRE PROYISOIRE DEVRA ETRE HAUGE A PARTIR DU 16 OECEMBRE 1889 CONTRA UN TORE !MINIX :LES TITRES KFINITIESPRENORONT SEALS PART All TIRAGE DU 15 rtviiffitTaft , 43/A4.1 • COMPAGNIE UNIVERSELLE DU CANAL INTER PANAMA Societe anonyms au capital do TROIS CENTS MILLION! do Frans SOCIETE CIVIL; AVEC RESPONSABILITE LIMITEE A LA MIRE SOC1ALE PCUR L'AMORTISSEMENT DES. OBLIGATIONS A LOTS DU CANAL DE PANAMA, EMISSION DU 26 JUIN 1888 • EMPRUNT DE 720 MILMONS EMPRUNT AUTORISE CONFORMEMENT AUX PRESCRIPTIONS BE LA LOI 1:111 21 MAI 1836, PAR LA LOI DU 8 JUIN 1888, MATS SANS AUCUNE GARANTIE DU RESPONSABILITE PE L'ETAT SOUSCRIPTION PUBLIQUE A DEUX MILLIONS D'OBLIGATIONS A LO 1"'"'"'s,s` LUTZ?' Rai Zret.:717:111Tr'r"r taaslisilqr."6WifttItt *b*"" """ LE NEMSOUASEMENT A 400 FRANCS ET LE PAIEMENT DES LOTS SERONT MANTIS PAR Ull!RPOT DE RUMS FRA OU OE TITRES GARANTIS PAR LE GOUVERNERENT FR or . 4' 'DO 'Pet;._ CANAL P-ri I}EEEFOC UE • . DE • StN AO' TITRE PROVISO1FiE AU . PORE •=1■1GOCIABLE N° 0,870,490 ....... DE UNE OBLIGATION LIBERBE DE 440 FRANCS Sala sem, de GO francs, la Compagnie Uni•erselle du Canal Iniereedatique a encalsed 50. . L.•.-50666 Civile d'Amortissement . . . . .... . . .. . . . . . . . . . . , . . . _ . .. , . . . . . .. „ . 10. . te complement du capital, sort300 francs, deem Pere vend no fpoques et .das les proportions indiquies cl-contru, de rare slue sus assent< des obligations entlemment liberLes, la part de la Conapagnie Universelle du Canal InterocAnigue soli de . 300. . et //, 611'///e I//// ///zi //://1/ 4i /WI' V I/ .1///...: /// /h•//,///,/ V /1, 4/, /.././/w 'nine/ nn.n/nnn7in /4/ ,,(n/y// / 4.//.% nnnn/n. /4n/alnwn ///:V al/ //A9'h. ":,e/ /ht. ni. 7n/n•An angennlinn/ nitiannin: nzny ..4nne;//n.nnw in] nv.,/,,einlift /inneini• nly //in / ./7•;.../n/inn Zwytivin Awn/ ;/;n.,/,/, //:/ /41' ///hh// ,,/,/ /h/".////// I/ ,11:"..?/-17%>/./...../////7„/// //.// // • /.1/1-11//!) 1//////..?Ih'17.1. I/ ./h, ///./././/7,7///,,////•' //h// //,/, 1////lh //, /.1.///,/ /%1/1, "// ?:-/I:///////,/// ,4/////ivA.;1,///7 ///h 1///////,.//*I /1 . 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