Paper Money - Vol. XLIX, No. 2 - Whole No. 266 - March - April 2010

PAPER MONEY OFFICIAL JOURNAL OF THE SOCIETY OF PAPER MONEY COLLECTORS VOL. XLIX, NO. 2, WHOLE NO. 266 WWW.SPMC.ORG MARCH/APRIL 2010 Creation of Money During the Great Depression, the Greatest Tectonic Shift in Federal Currency in U. S. History by Peter Huntoon Mar/Apr cover 8/10/11 5:44 AM Page 1 Get Noticed! Wanted Your Full Color Advertising Here Inquire fred@spmc.org Mar/Apr cover 8/10/11 5:44 AM Page 2 Paper Money • March/April 2010 • Whole No. 266 81 TERMS AND CONDITIONS PAPER MONEY (USPS 00-3162) is published every other month beginning in January by the Society of Paper Money Collectors (SPMC), 92 Andover Road, Jackson, NJ 08527. Periodical postage is paid at Jackson, NY 08527 and additional entry offices. Post- master send address changes to Secretary Jamie Yakes, P.O. Box 1203, Jackson, NJ 08527. © Society of Paper Money Collectors, Inc., 2010. All rights reserved. Reproduction of any article, in whole or part, without written permission, is prohibited. 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Advertising copy shall be restricted to paper currency, allied numismatic material, publications, and related accessories. The SPMC does not guarantee advertise- ments, but accepts copy in good faith, reserving the right to reject objectionable material or edit copy. SPMC assumes no financial responsibility for typo- graphical errors in ads, but agrees to reprint that por- tion of an ad in which a typographical error occurs upon prompt notification. v Official Bimonthly Publication of The Society of Paper Money Collectors, Inc. Vol. XLIX, No. 2 Whole No. 266 March/April 2010 ISSN 0031-1162 FRED L. REED III, Editor, P.O. Box 118161, Carrollton, TX 75011 Visit the SPMC web site: www.spmc.org FEATURES The Clark-Gruber FIVE ‘Great Hindsight” . . . . . . . . . . . . . . . . . . . 83 By Steve Whitfield Paper Column: Creation of Money during the Great Depression . . 90 By Peter Huntoon Helen A. Clark & Ella M. Clark, National Bank Presidents . . . . . 122 By Karl Sandford Kabelac Recycling of Bank Note Plates for Minnesota’s Free Banks . . . . 124 By R. Shawn Hewitt Welcome to Greenbackville, founded 1867 . . . . . . . . . . . . . . . . 132 By Terry Bryan The Buck Starts Here: Dutch artist prefers colorful notes . . . . . . 134 By Gene Hessler Laura A. Batcheller, National Bank President . . . . . . . . . . . . . . . 135 By Karl Sandford Kabelac Mrs. R.L. Whaley, National Bank President . . . . . . . . . . . . . . . . 138 By Karl Sandford Kabelac CSA Montgomery Note vignettes depicted on obsolete bank notes . 146 By Joseph J. Gaines Jr. SOCIETY NEWS Information and Officers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .82 New Members . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113 Joaquin Gil del Real pens book on Panama’s Paper Money . . . . . . . . . . .123 Reviewed by Fred Reed President’s Column . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .136 By Mark Anderson Money Mart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .137 An Index to Paper Money, Vol. 48 (2009) . . . . . . . . . . . . . . . . . . . . . . . . .140 Compiled by George B. Tremmel Whitman releases ‘Official Red Book’ checklist and record book . . . . . . . .142 Reviewed by John and Nancy Wilson New book details notes of Republic of Texas . . . . . . . . . . . . . . . . . . . . . .123 Reviewed by Fred Reed C.T. Rodgers reviews history of Disney Dollars . . . . . . . . . . . . . . . . . . . . .144 Reviewed by Fred Reed What’s on Steve’s Mind Today? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 158 By Steve Whitfield The Editor’s Notebook . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .158 Paper Money *Mar/Apr 2010 Paper Money 8/9/11 8:42 AM Page 81 Paper Money • March/April 2010 • Whole No. 26682 Society of Paper Money Collectors OFFICERS ELECTED OFFICERS: PRESIDENT Mark Anderson, 115 Congress St., Brooklyn, NY 11201 VICE-PRESIDENT Vacant SECRETARY Jamie Yakes, P.O. Box 1203, Jackson, NJ 08527 TREASURER Bob Moon, 104 Chipping Court, Greenwood, SC 29649 BOARD OF GOVERNORS: Mark Anderson, 115 Congress St., Brooklyn, NY 11201 Pierre Fricke, Box 52514, Atlanta, GA 30355 Shawn Hewitt, P.O. Box 580731, Minneapolis, MN 55458-0731 Matt Janzen, 3601 Page Drive Apt. 1, Plover, WI 54467 Robert J. Kravitz, P.O. Box 6099, Chesterfield, MO 63006 Fred L. Reed III, P.O. Box 793941, Dallas, TX 75379-3941 Michael B. Scacci, 216-10th Ave., Fort Dodge, IA 50501-2425 Lawrence Schuffman, P.O. Box 19, Mount Freedom, NJ 07970 Neil Shafer, Box 17138, Milwaukee, WI 53217 Robert Vandevender, P.O. Box 1505, Jupiter, FL 33468-1505 Wendell A. Wolka, P.O. Box 1211, Greenwood, IN 46142 Jamie Yakes, P.O. Box 1203, Jackson, NJ 08527 APPOINTEES: PUBLISHER-EDITOR Fred L. Reed III, P.O. Box 118162, Carrollton, TX 75011-8162 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 Jeff Brueggeman, 711 Signal Mountain Rd. # 197, Chattanooga, TN 37405 MEMBERSHIP DIRECTOR Frank Clark, P.O. Box 117060, Carrollton, TX 75011-7060 PAST PRESIDENT Benny Bolin, 5510 Bolin Rd., Allen, TX 75002 WISMER BOOK PROJECT COORDINATOR Vacant REGIONAL MEETING COORDINATOR Judith Murphy, P.O. Box 24056, Winston-Salem, NC 27114 BUYING AND SELLING HUGH SHULL P.O. Box 2522, Lexington, SC 29071 PH: (803) 996-3660 FAX: (803) 996-4885 CSA and Obsolete Notes CSA Bonds, Stocks & Financial Items Auction Representation 60-Page Catalog for $5.00 Refundable with Order ANA-LM SCNA PCDA CHARTER MBR SPMC LM 6 BRNA FUN 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 SPMC meeting is held in June at the Memphis International Paper Money Show. Up-to-date information about the SPMC, including its bylaws and activities can be found on its web site www.spmc.org. SPMC does not endorse any company, dealer, 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 18 years of age and of good moral character. Their application must be signed by a parent or guardian. Junior membership numbers will be preced- ed 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 eligi- ble 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 membership 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 available. 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 a fall issue of Paper Money. Checks should be sent to the Society Secretary. v *Mar/Apr 2010 Paper Money 8/9/11 8:42 AM Page 82 Paper Money • March/April 2010 • Whole No. 266 3 WANTED GREAT RESEARCH AND FEATURE ARTICLES ON ALL PHASES OF BANKS, BANK NOTES, FINANCE, CURRENCY, BONDS, STOCKS, & ETC. IT’S VERY SIMPLE TO SUMBIT ARTICLES AND ART ELECTRONICALLY VIA EMAIL DON’T WAIT SEND YOUR BEST STUFF NOW TO fred@spmc.org *Mar/Apr 2010 Paper Money 8/9/11 8:42 AM Page 83 Paper Money • March/April 2010 • Whole No. 26684 M Y FIRST EXPOSURE TO THE MAGNIFICENT $5 CLARK, Gruber obsolete notes of Denver, Colorado was in an early 1970s letter from a fellow western collector. He informed me that he had been offered a pair of these notes for $1,400. If I only knew then what I know now, I might have been able to go halfs with him for one of the notes. But, of course $700 to me in those days was like $100,000 today. Over a recent three-year period there have been four opportunities to obtain one of these incredible obsolete notes from Denver. Produced by American Bank Note Co. in 1861, the notes were redeemable in Clark, Gruber’s own gold coinage. This was at a time when federal currency was being heavily discounted. The initial printing order was for 2,000 sheets, serial numbered from 1 to 2000. Each sheet contained two notes, plate letters A and B. The notes have a wonderful, F.O.C. Darley, bison hunting scene as the central vignette, along with a portrait of Colorado Governor Gilpin. A red/orange pro- tector and cartouche perfectly complement the design of these beautiful notes. The original printing order to ABNCo was later increased by another 3,000 sheets, serial numbered 2001 to 5000, also with two notes per sheet; plate letters A and B. The first opportunity, came with Stack’s sale of the John Ford collection in January 2005. That sale included a plate B proof of the note, with no serial number. The proof brought a record high price of $77,625 for an obsolete note, at that time. Not long afterward, on June 17th, 2005, R.M. Smythe sold the Schingoethe copy of an unissued remainder, serial number 2007, plate A, for $60,375. (The other note from the same sheet, serial number 2007 B, is illustrat- ed in a History of the First National Bank of Denver by Agnes Wright Spring) ‘King of Obsolete Notes’ The Clark, Gruber FIVE ‘Great Hindsight’ by Steve Whitfield *Mar/Apr 2010 Paper Money 8/9/11 8:42 AM Page 84 Paper Money • March/April 2010 • Whole No. 266 85 Clark, Gruber & Co. struck $2.50, $5, $10 and $20 gold coins in 1860-1861. When the firm circulated their paper notes they were redeemable in these coins. Editor’s note; For more about Clark, Gruber & Co. see the author’s prize-winning Kansas Paper Money an Illustrated History, 1854- 1935 (McFarland, 2009) www.mcfarlandpub.com *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 85 Paper Money • March/April 2010 • Whole No. 26686 In January 2008, Heritage Auctions sold another of these notes, serial number 1999, plate B, for $126,500! This was also an unissued remainder. Next up, in a fourth opportunity to own the note, was the June 2008 Memphis auction by Lyn Knight, with the plate B note of sheet number 2004. This was, another unissued remainder that brought $85,000. All this note activity made me wonder how many of these incredible notes are still around and whether any signed and issued notes might exist. In 1966, Nolie Mumey produced a book about Colorado scrip. The book itself is a desir- able collectible today. He included color plates, bound into the book, of three of these $5 notes with some different serial numbers. Two of the notes are from the same sheet, number 2011, plates A and B. Both are obviously unissued remain- ders. The third was particularly interesting as it has what appear to be cut out cancellations in the signature spaces. The photo was not clear enough to tell whether it was signed. This note, serial number 2042, plate B was attributed to the Colorado Historical Society Library, which still has this note in their library collection. With the help of the library staff the note was examined. Unfortunately there were no signatures ever affixed to the note, although it is cut cancelled. In summary, we can count one proof, six unissued remainders, and one cut cancelled copy, for a total of eight known survivors. It is likely that notes numbered 1999 A and 2004 A survived since the B plate varieties are known. Why these notes were not all used, except for the proof, remains a mystery. 2000 sheets at $10 a sheet is only $20,000. And although an additional $30,000 in notes Left to right: Company principals, Austin M. Clark, Milton E. Clark and Emanuel H. Gruber. Check drawn on the Banking House of Clark, Gruber & Co., Leavenworth City, Kansas *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 86 Paper Money • March/April 2010 • Whole No. 266 87 was later ordered, this only totals $50,000. Clark, Gruber minted almost $600,000 in gold coins, according to one report, so there certainly was adequate gold backing to issue all of the notes. And why the large gap from sheet number 2011 to 2042B is unknown. However; it is likely that none of the second order were issued because the federal government was issuing greenbacks by that time and anyone with a debt would be smart to spend depreciated U.S. currency, rather than notes that were as good as gold. Could there still exist unused sheets from #1999 to #2042, or from #2042 to #5000? I’ll bet that more of these beau- tiful notes are still out there, waiting to surface. If only I had a spare $100,000 I would have been at the Memphis sale. These notes are surely the “1933 U.S. $20 gold coins” of obsolete paper money. I wonder when the next one will surface. Census (so far) Plate A Comment Plate B Comment SENC Proof ex-Ford/Stacks SENC 1999 Heritage Sale SENC 2004 Knight Memphis 2007 FNB 2007 ex-Schingoethe/Smythe 2011 Mumey 2011 Mumey SENC 2042 Mumey City directory ad, 186901861 *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 87 Paper Money • March/April 2010 • Whole No. 26688 Proof $5 note brought $77,625 in a January 18, 2005, Stacks’s auction Remainder $5 note brought $126,500 in a January 9, 2008, Heritage Auction Galleries sale. Remainder $5 note brought $85,000 in a June 27, 2008, Lyn Knight auction. v Remainder $5 note brought $60,375 in a June 17, 2005 R.M. Smythe auction. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 88 Paper Money • March/April 2010 • Whole No. 266 89 NOBODY does paper money better than PAPER MONEY • best reproduction • best audience • best rates . . . IN FULL LIVING COLOR, too! If you REALLY want to sell your killer notes . . . not just admire them in your inventory, this is . . . THE PLACE Discover . . . YOUR pot of gold HERE! Advertise in PAPER MONEY *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 89 Introduction and Purpose NEWLY ELECTED FRANKLIN D. ROOSEVELT AND HISNew Deal Democrats instituted the most sweeping changes in U. S.monetary policy in the history of the nation during 1933 and 1934.The monetary innovations driven by the outbreak of the Civil War, which heralded the issuance of legal tender notes and national bank notes, paled in comparison. The situation in 1933 was acute, the American banking system was collapsing, panic gripped the public, and vast swaths of people were suffering severe financial hardship. Creation of Money During the Great Depression the Greatest Tectonic Shift in Federal Currency in U. S. History The Paper Column by Peter Huntoon Paper Money • March/April 2010 • Whole No. 26690 *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 90 Paper Money • March/April 2010 • Whole No. 266 91 *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 91 Well known is that Roosevelt took the United States off the gold standard. Less well known is that the entire cur- rency regimen used by the country was fundamentally altered. The results were new series for most classes of currency, new legal tender clauses, and termination of the circulation of gold certificates outside the Treasury and Federal Reserve Banks. When the smoke cleared, silver was all that could be obtained for those wishing to convert their paper money into metal. The United States was on a modified bimetallic stan- dard going into the depression with the heavy lifting being done by gold and limited, but extensive, monetization of sil- ver. All U. S. currency ultimately was redeemable in gold for those wishing to jump the necessary hoops, although silver or small denomination silver certificate surrogate currency was the predominant metal used by the masses for small transac- tions. Silver was fully monetized coming out of the depres- sion, an outcome that had been on the wish list of free silver western and southern populists for several decades prior. Use of gold in the settlement of accounts with governments or their central banks became the exclusive preserve of the Federal government. The purpose of this article is to explain the changes that took place, and to identify how and why those changes altered our paper currency. To get there, we will look at the laws, proclamations and policy memos that drove the changes. We will walk through the events in chronological order. Perhaps this will help make sense of the different series and design changes that you have observed on the notes issued before and after. The Big Picture The restructuring during 1933-4 was radical and dramatic. When you stand back, it all appears to have been quite simple. Much of it was driven by a couple of populist economic tenets that had been advocated by populist politicians in the 1800s, and given forceful voice by William Jennings Bryant during his cam- paign for the presidency as a Democrat in 1896. First, a recurring problem was that when events caused the public to feel financially insecure, everyone preferentially hoarded gold but also glommed onto cash of every type that they could lay their hands on, removing it from banks and commerce, thereby weakening both. The hoarding made whatever economic problems were occurring worse by creating a money stringency that stifled com- merce. This cyclical phenomenon periodically resulted in severe financial panics, the most recent being 1873, 1893, 1907 and, at the time, 1933. Gold was seen as the villain by the populists, who considered it to be a useless metal that was arbi- trarily expensive and which, because it was used to constrain the quantity of money, caused money to be scarce and out of reach for too many. Second, during the early days of the Great Depression, many populists thought that the U. S. dollar was overvalued and thus too scarce to benefit the average person, so they felt the dollar should be cheapened and the money supply greatly increased if all were to prosper. The idea was, of course, that economic activity would be stimulated if everyone had more dollars in their pockets to spend, a proposition that resonated throughout the rural regions and with labor. Roosevelt's proclamation that required people to turn in their gold allowed the Federal government to buy their gold at $20.67 per ounce and, in the process, got the gold out of hoards. Shortly after the government acquired the gold, and using newly passed legislation giving him control over the value of gold, Paper Money • March/April 2010 • Whole No. 26692 Figure 1. Newly elected Franklin D. Roosevelt in 1933 instituted the greatest transformation of the United States currency system in history. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 92 FDR issued a second proclamation revaluing the gold at $35 per ounce, thus deflating the dollar by over 40 percent. The Treasury immediately marked up the value of its gold holdings to the new value which allowed the government to increase the money supply available to itself by an additional $3 billion. This first bought a $2 billion Stabilization Fund which was and still is used to manipulate foreign exchange rates to our advantage. Much of the rest was simply spent on New Deal programs. Simultaneous laws passed with Roosevelt’s urging fully monetized all the silver in the Treasury, including large stocks of bullion that the government had purchased during recent decades as a populist subsidy to western mining interests, and also authorized the unlimited purchase of new silver. Through a revaluation of the silver concurrent with that of gold, and seigniorage gains from coining new coin, these actions created hundreds of millions of dollars worth of new money. That money appeared in the form of silver certificates, which were pumped into the economy in order to inflate the currency supply. By cheapening the dollar, huge flows of gold came from abroad because the dollar was cheap relative to the other major currencies as were American goods priced in those dollars. That gold, of course, went into the Treasury. The long term outcomes were that by World War II the United States was the wealthiest nation on earth, and the U. S. dollar was the preeminent cur- rency and store of wealth in the world. New Deal legislation insured bank deposits by the Federal Deposit Insurance Corporation, greatly increasing public confidence in banks. However, all the money created during the New Deal pro- grams in the 1930s did not result in full employment as expected by government policy makers. Instead, recovery from the Great Depression in terms of full employment and economic prosperity for the middle and lower classes turned on massive spending by the Federal government as the government executed World War II. Prelude to Inauguration Day By the time Roosevelt was sworn in on March 4, 1933, the stock market crash of October 1929 was history, but the market was collapsing again. From its all time high of 381.17 in September 1929, the Dow Industrial Average had imploded to 41.22 in July 1932. That number represented an 89 percent slaugh- ter. 93Paper Money • March/April 2010 • Whole No. 266 Figure 2. The Dow Jones Industrial Stock Average during the depres- sion years. Notice that the vertical scale is logarithmic, which greatly lessens the visual impact of the downturns. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 93 Paper Money • March/April 2010 • Whole No. 26694 The stock market crash is often considered the onset of the Great Depression, but, in fact, that jolt primarily hurt the upper classes. The lower and emerging middle classes already had been put through the wringer for several years prior. Rural America was still reeling from the devastating agricultural depression of 1921-4, caused by the collapse of farm commodity prices following World War I. This produced one of the greatest internal migrations of people our nation has experienced as displaced farmers gravitated to cities to find work. The severely weakened agricultural sector heightened the vulnerability of the national economy to the shock of the 1929 stock market crash and subsequent economic downturn. 8,000 state and national banks failed during the period 1921-1931. The capital stock of 85.7 percent of these was less than $100,000, revealing that it was the rural banks that suffered the most. Real estate values had peaked in 1925, and their subsequent decline exac- erbated the blow of collapsing stock prices in 1929. The vulnerable banking sys- tem began to falter as withdrawals and hoarding depleted it of funds. The statis- tics for the national banks in operation between 1929 and 1935 are sobering and can serve as a barometer for conditions across the entire banking industry. There were 7,506 operating national banks on October 31, 1929. Another 955 were chartered during the next six years, but 3,030 went out of business, most as fail- ures. The net number operating on October 31, 1935 was 5,431. The 3,030 loss Figure 3. Economically displaced homeless family on the road during the Great Depression. (Dorothea Lange photo, Library of Congress) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 94 represented 21.1 percent of the total number of national banks chartered between 1863 and 1935, yet they went out of business during a period representing a scant 10 percent of the elapsed time. In panic, Comptroller of the Currency John Pole, Herbert Hoover’s appointee, pointed out as early as 1930 that failures were reaching alarming pro- portions, particularly in rural regions, and “those who have suffered the most in these failures were persons of small means - country businessmen, farmers, and savings depositors in farming communities (Pole, 1930, p. 2).” Each year during his tenure, he pleaded for the state and federal governments to liberalize branch banking laws, which would permit large urban banks to reach into the rural areas in order to provide those citizens with as sound a banking system as enjoyed by the depositors in the city banks. In 1932, Pole estimated that $1.5 billion had bled from the banking system as a result of hoarding, which severely weakened banks by removing desperately needed resources. The outgoing Republican Hoover administration and Congress had not been oblivious as these events unfolded. Legislation establishing the Reconstruction Finance Corporation was passed January 22, 1932, with the initial objective being to loan money to shaky banks in order to give them liquidity and to railroads to shore them up because banks were heavily invested in rail- road bonds. The RFC was capitalized at half a billion dollars, plus given another billion and a half line of credit from the Treasury. The RFC legislation was amended July 21st to allow it to provide loans for self-liquidat- 95Paper Money • March/April 2010 • Whole No. 266 Figure 4, above. Unemployed men gather at the Hoover Dam employ- ment office in Las Vegas in September 1931. The construction of Hoover Dam was a major Federal public works project initiated during the Hoover administration. (Boulder City-Hoover Dam Museum photo 2:1580) Figure 5, below. One of the most valuable things to possess during the Great Depression was a job. (Boulder City- Hoover Dam Museum photo 1:0002) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 95 Paper Money • March/April 2010 • Whole No. 26696 Figure 6. Destitute mother and chil- dren hope for word of employment for father during a strike of other workers on August 13, 1931, at their makeshift quarters in Williamstown, also known as Ragtown, along the Colorado River just upstream from the Hoover Dam construction site. (Boulder City-Hoover Dam Museum photo 2:0322) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 96 ing public works projects, and to states to provide relief and work relief to needy and unemployed people (Butkiewicz, current). An attempt was made to shore up real estate val- ues with passage of The Federal Home Loan Act on July 22, an act which also contained provisions to help national banks increase their circulations in order to offset the impacts of hoarding. The problem was that the Hoover measures were too little too late. By the fall of 1932 public lack of confidence in the Republicans was verging on despair, so the road was paved for a Democratic landslide in the November elections. A stock market rally that peaked at 79.93 in the summer of 1932 collapsed, and stock prices fell though March 1933. The ideological divisiveness set up by the clash between the moneyed classes and the incoming New Dealers contributed in no small part to public uncertainty between election day and inauguration day. Roosevelt did not communicate directly with Hoover. Instead, he stood by as the economy, and banks in particular, spiraled into the abyss. January and February 1933 witnessed urgent debate on the House and Senate floor as inflationists battled sound money advocates over emergency cur- rency legislation. Colorado Congressman William Eaton took to the floor on February 14, 1933 to say “There is a money panic on, and it is at the height now. It is fear. The bankers are afraid. People in Congress are afraid. People throughout the country are afraid.” Some 140 towns had resorted to scrip and wooden money to survive. (Congressional Record, Feb 14, 1933, p. 4088). The roiling storm first overtook banking in Michigan where runs on banks and pressure from Treasury officials forced Governor William Comstock to close every bank in the state by a proclamation dated February 13, 1933. Alter (2006, p. 190) relates that by the evening of March 4, 32 of the 48 states as well as the District of Columbia had closed their banks. A quarter of the work- force was unemployed. Farm commodity prices were off 60 percent from previous highs. Industrial production had fallen by more than half since 1929. Two million were homeless. Origin of Series of 1929 FRBNs FDR was inaugurated on March 4, 1933, a Saturday. The following Monday, March 6th, he issued his famous proclamation closing every bank in the United States and its possessions for a period of 4 days. On March 9, he asked Congress for legislation giving the executive branch control over banks for the protection of depositors. The Emergency Banking Relief Act of March 9, 1933 was passed at 8:30 pm without a single dissenting vote, and the president immediately extended the bank holiday indefinitely. The Emergency Banking Relief Act provided for the examination and licensing of national banks before they could reopen. It also authorized the Comptroller of the Currency to take charge of the affairs of shaky banks, and to place them in conservatorships with conservators appointed to protect the 97Paper Money • March/April 2010 • Whole No. 266 Figure 7, above. A bank run on February 28, 1933, as panic swept the country during the closing days of the Hoover administration. Figure 8, below. Ogden L. Mills, President Herbert Hoover’s outgoing Secretary of the Treasury, oversaw preparation of most of the Emergency Banking Relief Act during his last days in office. Mills appeared on the July 13, 1931 Time magazine cover. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 97 Paper Money • March/April 2010 • Whole No. 26698 assets on behalf of depositors. In addition, the act authorized the Reconstruction Finance Corporation to purchase the preferred stock in qualifying banks in order to shore them up. Title 1, section 3, of the act stated “Whenever in the judgment of the Secretary of the Treasury such action is necessary to protect the currency system of the United States, the Secretary of the Treasury, in his discretion, may require any or all individuals, partnerships, associations and corporations to pay and deliv- er to the Treasurer of the United States any or all gold coin, gold bullion, and gold certificates owned by such individuals, partnerships, associations and corpo- rations.” The purpose of all this was to boost confidence of the public in the bank- ing system and to foment a strategy to return hoarded money to commerce. The mechanism would certify which banks were good, shore up weak banks that could work out of their difficulties given time, and conserve the assets as best as possible for depositors in banks that were insolvent. Hoover and his administration had been well aware that banking reform was imperative and that a bank holiday was fast becoming necessary. The fact is that much of the Emergency Banking Relief Act already had been prepared under the direction of Ogden Mills, Hoover’s Secretary of the Treasury, some of it months before (Awalt, 1969). The pace of events, their lame duck status, and Roosevelt’s deaf ear simply overwhelmed their capacity to act. Federal officials anticipated that runs might resume once the banks were reopened. In the words of Acting Comptroller of the Currency Awalt (1969) in recalling a meeting called by Secretary of the Treasury Mills on March 4: Dr. Goldenwiser [Emanuel A. Goldenwiser of the Federal Reserve Board staff] suggested that, inasmuch as the necessary machinery, the Federal Reserve System, was available, it should be used to issue cur- rency. This suggestion finally crystallized into the plan for the banks to borrow on anything they might have with the Federal Reserve System to issue Federal Reserve Bank notes against the borrowings. Figure 9. The Series of 1929 emer- gency Federal Reserve Bank Notes printed to infuse banks with cash after the Bank Holiday in March 1933 were hastily printed using blank pre-printed Series of 1929 national bank note stock. The blanked out titles of national bank officials and overprinting of appropriate Federal Reserve Bank titles gave the series a very provisional appearance. (Photos courtesy of the National Numismatic Collection, Museum of American History, Smithsonian Institution) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 98 Paper Money • March/April 2010 • Whole No. 266 99 The plan built into the act provided for a new series of Federal Reserve Bank Notes that would be pressed into service by the banks to tide them over. The mechanism allowed the Federal Reserve Banks to deposit U. S. government bonds and commercial paper with the Treasurer of the United States to be used to secure the notes. The bonds and commercial paper, of course, would come from the commercial banks needing the cash. The Comptroller of the Currency would issue the notes to the Federal Reserve Banks, which in turn would pass the notes on to the banks. Thus was born the Series of 1929 Federal Reserve Bank Notes. The problem faced by the government was that these notes were needed immediately, so there was no time to design, engrave and produce new dies and prepare plates to print them. Instead, the Bureau of Engraving and Printing utilized existing stocks of unfinished national bank note sheets carrying the Series of 1929 designa- tion, and overprinted the Federal Reserve Bank information on them. This gave rise to a very provisional looking currency, many with blacked out titles of the national bank note officers that were replaced with the appropriate overprinted titles for the Federal Reserve officials whose signatures appeared on the notes. The Bureau of Engraving and Printing instituted a 24-hour-per-day crash program to turn out the new series. Production of the notes began on March 9th with the first deliveries to the Federal Reserve Banks commencing the next day. A total of $911,700,000 worth of the notes was printed in $5, $10, $20, $50 and $100 denominations by February 1934. Roosevelt, in a fireside radio chat with the nation on March 12th, explained the actions being undertaken to stabilize banks and quell bank failures (Brasschecktv, current). He was so successful in calming fears and raising confi- dence that when the banks reopened, the bankers generally experienced an increase in deposits rather than withdrawals. The demand for Federal Reserve Figure 10. Bureau of Engraving and Printing personnel labored day and night to turn out the Series of 1929 Federal Reserve Bank Notes. This photograph of the BEP building was taken during the night of March 8, 1933, as they began to gear up for printing the notes the next day. (International News Photo, King Features Syndicate Inc.) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 99 Paper Money • March/April 2010 • Whole No. 266100 Figure 11, above. View across one of the press rooms in the Bureau of Engraving and Printing taken when the Series of 1929 Federal Reserve Bank Notes were on the presses. (International News Photo, King Features Syndicate Inc.) Figure 12, below. The woman to the right is trimming incomplete Series of 1929 national bank note stock preparatory to it being sent through the overprinting presses to be turned out in the form of emergency Federal Reserve Bank Notes. (International News Photo, King Features Syndicate Inc.) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 100 Paper Money • March/April 2010 • Whole No. 266 101 Bank Notes turned out to be fairly modest. A total of $284,903,250 worth of them were issued during the 1933-4 period, representing only 31.2% of the printing. The rest were used up during World War II at the end of 1942 and into 1944. On March 11, Roosevelt announced that qualified banks would be reopened by March 16th. Of the 5,916 national banks entering the bank holiday, 4,510 opened with licenses by that Thursday. The unlicensed banks shown to have sound assets were licensed during the ensuing year. The remainder were liquidated or placed in receiverships. Figure 13. President Franklin D. Roosevelt’s proclamation of April 5, 1933, requiring U. S. citizens to turn over their gold to the Federal Government in order to prevent hoarding. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 101 Paper Money • March/April 2010 • Whole No. 266102 Gold Confiscation Order President Roosevelt issued executive order 6102 on April 5, 1933, the purpose of which was to require everyone to turn in their gold, gold bullion and gold certificates to banks which would then forward these items on to the Federal Reserve Banks. The purpose of his order was to free up the gold that had been hoarded, and to get it into the hands of the government where it could be used to inflate the currency supply and do some good. His action had been authorized by Congress in the Emergency Banking Relief Act of March 9th. His order repre- sented the first concrete step taken by the government to take the United States off the gold standard. Series of 1933 Silver Certificates A major piece of legislation passed May 12, 1933 was the Agricultural Adjustment Act. The single most important provision in the act was that it gave the President authority to set the price of gold and silver. One of the lesser provisions, called the Thomas Amendment, was designed to inflate the money supply with new silver certificates. Elmer Thomas, who sponsored the amendment, was a New Deal Senator from Oklahoma who was a fervent subscriber to the populist notion that inflation was good for the farmer because it would put cash into his pocket. The Thomas amendment was an ingenious plan to allow World War I debtor nations to pay off their debts in sil- ver priced at 50 cents per ounce, and repatriate that money into our economy when it was urgently needed. It read as fol- lows. The President is authorized, for a period of six months from the date of the passage of this Act, to accept silver in payment of the whole or any part of the principal or interest now due, or to become due within six months after such date, from any foreign government or governments on account of any indebtedness to the United States, such silver to be accepted at not to exceed the price of 50 cents an ounce in United State currency. The aggregate value of the silver accepted under this section shall not exceed $200,000,000. The Secretary of the Treasury shall cause silver certificates to be issued in such denominations as he deems advisable to the total number of dollars for which such silver was accepted in payment of debts. Such silver certificates shall be used by the Treasurer of the United States in payment of any obligations of the United States. The practical effect of this legislation was to accept silver from debtor nations and monetize it over here where silver already was tolerated as money. By doing so would inflate our currency supply. It’s appeal to debtor nations was that it was a cheap way to liquidate their obligations with a metal that was not fully monetized in many of their own economies, rather than sending gold which they needed and coveted. The New Dealers felt that it was better to accept silver now and put it to work, rather than to wait for gold which may never come. Figure 14. New Deal Democratic Senator Elmer Thomas from Oklahoma sponsored the Thomas Amendment to the Agricultural Adjustment Act of May 12, 1933, which resulted in the Series of 1933 $10 silver certificates issued against foreign silver used to pay off World War I debts. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 102 Paper Money • March/April 2010 • Whole No. 266 103 The following payments were received during the six month May to November 1933 window (Bureau of Public Debt, various). Fine Value at 50 Country Ounces Cents per Ounce Czechoslovakia 359,010.49 $179,505.25 Finland 296,631.88 148,315.94 Great Britain 20,001,036.84 10,000,518.42 Italy 2,000,041.52 1,000,020.76 Lithuania 19,980.70 9,990.35 Rumania 58,122.92 29,061.46 22,734,824.35 $11,367,412.18 Treasury records indicate that a total of 184,000 $10 Series of 1933 notes with a face value of $1,840,000 were issued in January 1934, prior to passage of the Gold Reserve Act signed by the president January 30, 1934. The 1934 act amended and supplemented prior laws relating to silver certificates, and led to the issuance of a consolidated series. Accordingly, the Series of 1934 was issued against the rest of the silver bullion from these repayments, which had not yet been converted into coin. As a result, the Series of 1933 was discontinued before the full complement of notes could be issued against the $11 million worth of sil- ver shown above as having been received. One 12-subject $10 Series of 1933 plate was made bearing plate number 12785, check number 1. It was certified for use on January 3, 1934, and carried Treasury signatures W. A. Julian, Treasurer, and William H. Woodin, Secretary. Woodin, a Republican, was Roosevelt’s first Secretary of the Treasury, but he was replaced by Henry Morgenthau Jr. on January 1, 1934, just two days before the plate was certified. Serials A00000001A through A00216000A were printed from it, and delivered to the Treasury between January 5 and February 27, 1934 (Shafer, 1967, p. 112). Four additional plates were made between mid-February and mid-April. They were designated Series of 1933A with Julian-Morgenthau signatures, and numbered 1 through 4. Notes A00216001A through A00552000A were printed from them, and delivered between February 27 and April 2, 1934. Of the 552,000 Series of 1933 and 1933A notes printed, the unissued remainder of 368,000 notes was destroyed during November 1935, taking all of the Series of 1933A notes with them. One great irony of the Thomas amendment was that it allowed World War I debtor nations, including England, the right to repay the United States with silver at the rate of fifty cents per ounce in 1933. The famous Pittman Act of April 23, 1918, which resulted in the melting of 295 million silver dollars yielding 200 million fine ounces of silver that were sold to England for use in India during World War I, fixed the sale of that silver at $1 per ounce. Figure 15. The rare Series of 1933 $10 silver certificates resulted from the Thomas Amendment, which was designed to inflate the curren- cy supply for the good of farmers. (Photo courtesy of the National Numismatic Collection, Museum of American History, Smithsonian Institution) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 103 Paper Money • March/April 2010 • Whole No. 266104 Legal Tender Provisions Legal tender notes, also called United States notes, born of necessity dur- ing the Civil War, had become a fixture of our currency system by the time of the Great Depression. The legal tender notes were promissory notes used to help finance the Civil War that were issued by the Treasury to be redeemed in lawful money at some unspecified future date. They were nothing but circulating debt that, of course, did not pay interest. The Treasury anticipated redeeming them as soon as possible after the war when sufficient tax revenues accrued to the Treasury, but western and south- ern populists resisted their redemption because it would deflate the money supply, which they perceived as unfavorable to their economies. The act that authorized the resumption of specie payments in 1879, which was passed January 14, 1875, contained a provision that required the Secretary of the Treasury to redeem the outstanding legal tender notes to a floor of $300 million as national bank note circulation increased. This provision was repealed on May 31, 1878, by an act that forbade further redemptions of legal ten- der notes, a provision passed to placate the inflationists. There remained out- standing $346,681,016 worth of legal tender notes at the time the 1878 act passed, Figure 16. Series of 1933 $10 silver certificates bearing Julian- Morgenthau signatures were print- ed during 1934 under the terms of the Thomas Amendment. They never were issued because the Series of 1934, which came about with pas- sage of the Gold Reserve Act, sup- planted the series. Figure 17. $10 and $20 Series of 1928 legal tender production plates were made at the end of the Hoover Administration, but no notes were printed from them. There was pop- ulist agitation in Congress in 1932 to pay the WW I veteran bonuses with fiat money, so it appears that these $10 and $20 legal tender plates were authorized in case that legislation passed and the notes were needed in a hurry. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 104 Paper Money • March/April 2010 • Whole No. 266 105 so that amount remained in circulation from then on forward (Knox and others, 1903, p. 155-156). Title III of the Agricultural Adjustment Act of May 12, 1933, contained an extraordinary provision pertaining to legal tender notes. The president was authorized if “an economic emergency requires an expansion of credit” to issue an aggregate of up to $3 billion worth of additional legal tender notes: for the purpose of meeting maturing Federal obligations to repay sums borrowed by the United States and for purchasing United States bonds and other interest-bearing obligations of the United States: provided, That when any such notes are used for such purpose the bond or other obligation so acquired or taken up shall be retired and canceled. This highly inflationary provision allowed the president to convert $3 bil- lion in outstanding interest bearing debt into $3 billion worth of currency, which would directly inflate the currency supply. This measure would conveniently increase the outstanding floating debt almost nine fold, and nicely eliminate inter- est on that debt! Furthermore, the act stated: 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. The authority to issue additional legal tender notes beyond the existing mandated $346,681,016 limit was never invoked. However, the requirement to make all classes of coins and currency legal tender was put into effect. The mani- festation of this appeared on the legal tender notes in the form of a revised legal tender clause underneath the Treasury seal that was changed from: This note is a legal tender at its face value for all debts public and pri- vate except duties on imports and interest on the public debt to: This note is a legal tender at its face value for all debts public and pri- vate. The original language was a holdover from the period before the restora- tion of specie payments in 1879 when import duties were required to be paid in gold. At that time, the government didn’t want import duties paid with its own debt in the form of legal tender notes, rather it wanted gold to beef up the Treasury. Furthermore, Congress didn’t want the Treasury paying off maturing debt by printing more money. Legal tender notes could be converted into gold after 1879, so the clause had little meaning by 1933 anyway. Figure 18. The legal tender clause on the Series of 1928 Julian- Morgenthau legal tender notes was simplified to remove obsolete lan- guage forbidding the use of the notes to pay customs taxes and interest on the public debt. That language was from the 1862 legisla- tion that authorized their issuance, and was an artifact that persisted on legal tender and large size national bank notes after the resumption of specie payments in 1879. The Agricultural Adjustment Act of 1933 gave all classes of U. S. currency and coins equal legal tender status. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 105 Paper Money • March/April 2010 • Whole No. 266106 The redemption clauses on all the other classes of notes were brought into line with the new clause on the legal tender notes by the end of 1934. Expansion of the role for legal tender notes was contemplated in late 1932, even before the Democrats came into office. Series of 1928 $10 and $20 plates were prepared bearing Woods-Mills signatures, respectively the Treasurer and Secretary of the Treasury under President Hoover. Work on the $10 produc- tion plates was begun in November 1932, and the eight plates that were made were completed by the end of December. Similarly, eight $20 plates were begun in December and finished by the end of January 1933. Those plates never were sent to press. $1 legal tender plates were made bearing Woods-Woodin signatures after Roosevelt came into office, and 1,872,012 notes were delivered to the Treasury from those plates in April and May 1933. Walter O. Woods, a holdover Treasurer, and William H. Woodin served together from March 4, 1933 though May 31st. Woods was replaced by William A. Julian, a Roosevelt appointee, on June 1st, and Woodin resigned at the end of 1933 owing to throat cancer and was replaced by Henry Morgenthau, Jr. on New Years day 1934. Woodin died May 3, 1934. The first 5,000 $1s were made available through the cash room of the Treasury in Washington from the outset, but the rest were held in the Treasury until 1948-9 when they were dumped in Puerto Rico in order to minimize sorting problems in the mainland Federal Reserve Banks. The $1, $10 and $20 plates carried the old redemption clause because all predated the May 12, 1933 act. It soon became obvious that use of these denomi- nations would add to the burden of sorting redeemed notes, so it appears this is why their use was respectively curtailed or abandoned. Federal Deposit Insurance Corporation The most important legislation passed to protect the average citizen came in the form of the second Glass-Steagall Act, passed on June 16, 1933, an act called the Banking Act of 1933. The centerpiece of this legislation was the cre- ation of the Federal Deposit Insurance Corporation which insured bank deposits. For the first time, depositors had Federal insurance to protect the money in their accounts against bank failures. Important from a regulatory perspective was that the act forced the reor- ganization of banks into distinct classes based on the type of business they engaged in, such as commercial, investment and savings, and imposed a regulatory struc- ture that promoted sound practices within each. Thus the law served to compart- mentalize the banking industry in order to sever conflicting functions that had previously competed with each other within given banks. Now only one type of function took place under one roof. Key Executive Orders The very active Roosevelt administration issued a series of executive orders during the second half of 1933 that were designed to gain control over the gold supply in the United States. On August 28, it was announced that anyone other than a Federal Reserve Bank was forbidden from acquiring, holding or exporting gold, except under license. The next day, August 29th, producers learned that the Secretary of the Treasury was to receive all newly mined gold of domestic origin. On December 28, the Secretary of the Treasury ordered that all gold be delivered to the Treasury at $20.67 per ounce. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 106 Paper Money • March/April 2010 • Whole No. 266 107 Gold Reserve Act of 1934 The single act that had the greatest impact on the paper money issues of the United States was the Gold Reserve Act of January 30, 1934. Its far reaching provisions: 1. terminated coinage of gold, 2. required gold to be withdrawn from circulation, 3. terminated the redemption of any U. S. currency in gold, 4. ceded title of the gold in the Federal Reserve Banks to the United States, 5. authorize the unlimited coinage of silver, and 6. created the Stabilization Fund to regulate foreign exchange rates. The act allowed the President and Treasury to take the United States off the gold standard, to inflate the money supply, and to devalue the dollar. Title III, section 43:2 of the Agricultural Adjustment Act of May 12, 1933 already contained language permitting the unlimited coinage of silver, but the Gold Reserve Act spelled out how to do it. All the silver in the Treasury, not only coin but also bullion, was to be monetized. Federal Reserve Notes were backed by 40 percent of their face value in gold at that time, so as gold was taken out of circulation, the supply of Federal Reserve Notes theoretically could increase $2.5 for each gold dollar removed. These subtle machinations to inflate the money supply would pale in comparison to the ability of the President to create money through the revaluation of gold and silver; that is, provided the Treasury owned the gold and silver, which by then it did! End of the Gold Notes The gold confiscation order of May 5, 1933 effectively began the process of cleansing gold coins and gold certificates from circulation. A crucial next step was to give the United States title to the gold owned by the Federal Reserve Banks, a deed accomplished with the passages of the Gold Reserve Act. The Gold Reserve Act forbade the Treasury from paying out gold as follows: No gold shall hereafter be coined, and no gold coin shall hereafter be paid out or delivered by the United States. . . . All gold coin of the Figure 19. Figure 19. Casualties of President Roosevelt’s gold confisca- tion order were these attractive $10 and $20 Series of 1928A gold cer- tificates with Woods-Mills signa- tures. Plates were made to print them between October 1932 and June, 1933, but never were sent to press. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 107 Paper Money • March/April 2010 • Whole No. 266108 United States shall be withdrawn from circulation, and, together with all other gold owned by the United States, shall be formed into bars. . . . The issuance of gold certificates ceased with the confiscation order. The last gold certificates printed were Series of 1928 notes bearing Woods-Mills sig- natures, the last of which were $20s delivered from the Bureau of Engraving and Printing to the Treasury on April 28, 1933. (Shafer, 1967) The Series of 1928A $10 and $20 face plates bearing the signatures of Woods and Mills, which began to be made in October 1932 and continued to be made until June 1933, were never sent to press. All the pieces were now in place for Roosevelt to implement his grandest coup of all with respect to money. Revaluation of Gold Roosevelt by proclamation changed the price of gold from $20.67 to $35 per ounce on January 31, 1934. He wasted no time; the proclamation was issued the day after the Gold Reserve Act passed. This action deflated the value of the dollar by almost 41 percent. Important for the New Deal policy makers was that it instantly increased the value of the Treasury’s stock of gold by about $3 billion. The Gold Reserve Act specified that the profit from any revaluation would accrue to the Treasury. The first $2 billion was earmarked for establishment of the Stabilization Fund within the Treasury. This fund would be used to buy and sell gold between govern- ments or their central banks in order to maintain the parity of the dollar with other world currencies. What we are seeing here was the instantaneous creation of a huge amount of money in the form of devalued dollars that the government could use. American dollars and goods now looked cheap to the rest of the world, so gold began to flow to the United States as those economies purchased both. The New Dealers hoped all of this would stimulate economic recovery. Series of 1934 Gold Certificates The Gold Reserve Act ceded title of the gold owned by the Federal Reserve Banks to the United States. Credits for that gold were to be provided to the banks in the form of gold certificates issued by the Treasury. Figure 20. Series of 1928 gold notes with traditional green backs ceased to circulate outside the Treasury and Federal Reserve Banks after the President’s gold confiscation order. (Photo courtesy of the National Numismatic Collection, Museum of American History, Smithsonian Institution) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 108 Paper Money • March/April 2010 • Whole No. 266 109 United States Paper Money special selections for discriminating collectors Buying and Selling the finest in U.S. paper money Individual Rarities: Large, Small National Serial Number One Notes Large Size Type Error Notes Small Size Type National Currency Star or Replacement Notes Specimens, Proofs, Experimentals Frederick J. Bart Bart, Inc. website: www.executivecurrency.com (586) 979-3400 PO Box 2 • Roseville, MI 48066 e-mail: Bart@executivecurrency.com BUYING AND SELLING PAPER MONEY U.S., All types Thousands of Nationals, Large and Small, Silver Certificates, U.S. Notes, Gold Certificates, Treasury Notes, Federal Reserve Notes, Fractional, Continental, Colonial, Obsoletes, Depression Scrip, Checks, Stocks, etc. Foreign Notes from over 250 Countries Paper Money Books and Supplies Send us your Want List . . . or . . . Ship your material for a fair offer LOWELL C. HORWEDEL P.O. BOX 2395 WEST LAFAYETTE, IN 47996 SPMC #2907 (765) 583-2748 ANA LM #1503 Fax: (765) 583-4584 e-mail: lhorwedel@comcast.net website: horwedelscurrency.com *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 109 Paper Money • March/April 2010 • Whole No. 266110 The same day that Roosevelt issued Proclamation 2072 revaluing the gold, he released a statement that explained the action (Parks, current). In it he provided details about the new series of gold certificates that were going to be used to settle gold credits between the Treasury and the various Federal Reserve Banks. This credit due the Federal Reserve Banks is to be paid in the new form of gold certificates now in course of production by the Bureau of Engraving and Printing. These certificates bear on their face the wording: “This is to certify that there is on deposit in the Treasury of the United States of America . . . dollars in gold, payable to bearer on demand as authorized by law.” They also will carry the standard legal tender clause, which is as fol- lows: “This certificate is a legal tender in the amount thereof in payment of all debts and dues, public and private.” The new gold certificates will be of the same size as other currency in circulation and the only difference, other than the changes in wording noted above, is that the backs of the new certificates will, as used to be done, be printed in yellow ink. The certificates will be in denomina- tions up to $100,000. The new gold certificates were Series of 1934 notes that carried Julian- Morgenthau Treasury signatures. A memo was sent to the Director of the Bureau of Engraving and Printing by Under Secretary of the Treasury T. J. Coolidge on May 11th confirming that the backs were to be printed in yellow using standard back plates. They were printed in $100, $1000, $10,000 and $100,000 denomina- Figure 21. Series of 1934 $100, $1000, $10000 and $100000 gold notes intended to be used exclusive- ly within the Treasury and Federal Reserve Banks were authorized by the Gold Reserve Act, and were printed with distinctive yellow backs. The older green-back gold notes were exchanged for these when they became available. (Photo courtesy of the National Numismatic Collection, Museum of American History, Smithsonian Institution) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 110 Paper Money • March/April 2010 • Whole No. 266 111 tions, with the $100, $1000 and $10,000 going to press in May, and deliveries arriving at the Treasury on June 25th. The following quantities were printed: 120,000 $100s, 84,000 $1000s and 42,000 $10,000s. The new $100,000 back die was certified November 13, 1934, and the face followed. Delivery of 42,000 notes was made to the Treasury on January 9, 1935. That printing consisted of 3,500 12-subject sheets. Once available, the new yellow backs were substituted for Series of 1928 green back gold certificates held by the Federal Reserve Banks. The gold backs never circulated outside the Federal Reserve Banks and Treasury. Figure 22. The gand daddy of all the Series of 1934 gold certificates were the $100,000s with the late President Wilson’s portrait. 42,000 were made in 1935. (Photo courtesy of the National Numismatic Collection, Museum of American History, Smithsonian Institution) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 111 Paper Money • March/April 2010 • Whole No. 266112 Series of 1934 FRNs The gold redemption clause on the Series of 1928 Federal Reserve Notes became inoperative with passage of the Gold Reserve Act at the end of January 1934. Treasury officials recognized this immediately, but accommodating the new reality in the form of discontinuing the Series of 1928 was a fitful process. The Bureau of Engraving and Printing ceased printing faces for the Series of 1928 FRNs on February 14, 1934. There was a mix of $20 and lower denomi- nation 1928B, C and D plates for a few districts on the presses that last day. Large stocks of Series of 1928 notes were still in the production pipeline, and in the form of completed notes in storage at the Bureau of Engraving and Printing and in the vaults of the Reserve Agents at the various Federal Reserve Banks awaiting issuance to the banks. Federal Reserve Agents were representatives of the Secretary of the Treasury and Comptroller of the Currency who resided at the Federal Reserve Banks and maintained stocks of unissued notes, which they released to the banks when authorized. The Reserve Agents continued to order Series of 1928 notes from the BEP, even after printings of Series of 1934 notes began on September 27, 1934. Many of the incomplete 1928 sheets at the BEP continued onward to the serial numbering and sealing presses. In fact, two star printings were made in 1935, specifically $20 D00216001*-D00228000* on September 16th and $20 F00076001*-F00080000* on October 4th. The last delivery of the 1928 notes from the BEP involved $5s for San Francisco on October 9, 1935. Two matters had to be considered during the changeover from the Series of 1928 to 1934. Obviously it would take time to start production of Series of 1934 notes for all the districts, and also there was the question of who should pay for replacing the existing stocks of the 1928 notes if they were to be canceled. The lat- ter was not a trivial concern. Figure 23. The Series of 1928 Federal Reserve Notes with gold redemption clause were phased out fitfully. The Federal Reserve Banks ceased issuing them in January 1936, and over $4 billion were eventually destroyed in 1946. Figure 24. The first Series of 1934 Federal Reserve Notes, distin- guished because they were not redeemable in gold, went to press on September 27, 1934. Orders for Series of 1928 FRNs continued to be processed at the Bureau of Engraving and Printing for over a year beyond that date, although face printings from Series of 1928 FRN plates ceased on February 14, 1934. (Photo courtesy of the National Numismatic Collection, Museum of American History, Smithsonian Institution) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 112 Paper Money • March/April 2010 • Whole No. 266 113 SPMC NEW MEMBERS - 12/11/2009 These memberships expire 12/31/2010 13158 Jon DeRoma (C), Wendell Wolka 13159 Steven Johnson (C), Tom Denly 13160 Reecy Aresty (C), Jason Bradford 13161 Marlon Anderson (C), Jason Bradford 13162 Edward Azoyan (C), Jason Bradford 13163 J.R. 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Money Mart ads can help you sell dupli- cates, advertise wants, increase your col- lection, and have more hobby fun. Up to 20 words plus your address in SIX BIG ISSUES only $20.50/year!!!! * • extra charges apply for longer ads • Take it from those who have found the key to “Money Mart success” Put out your want list in “Money Mart” and see what great notes become part of your collecting future, too. HIGGINS MUSEUM 1507 Sanborn Ave. • Box 258 Okoboji, IA 51355 (712) 332-5859 www.TheHigginsMuseum.org email: ladams@opencominc.com Open: Tuesday-Sunday 11 to 5:30 Open from mid-May thru mid-September History of National Banking & Bank Notes Turn of the Century Iowa Postcards *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 113 Paper Money • March/April 2010 • Whole No. 266114 M. S. Eccles, Chairman of the Board of Governors of the Federal Reserve System wrote Secretary of the Treasury Morgenthau in October 1935 that about 5 billion Series of 1928 FRN notes were on hand, including $1.9 billion dollars worth of them in the vaults of the Federal Reserve Agents at the various banks, which had cost $340,000 to ship from Washington. Eccles further advised Morgenthau that the Federal Reserve Board agreed that they should cease issuing the Series of 1928 notes, but that the board felt it was the Treasury’s responsibility to pay the estimated $1.5 million it would take to replace them, because it was an action of the Treasury that rendered the gold redemption clause obsolete. Morgenthau responded on December 13, 1935 saying that he was going to seek an appropriation from Congress to pay the replacement costs, an appropria- tion that never came. Eccles wrote the following to Morgenthau on December 29, 1936. On December 20 I advised you that the Governors were in accord with the proposed procedure with the understanding that, if Congress at the next session of Congress did not authorize the Treasury to replace the unissued 1928 notes, the question whether the banks should resume issuing these notes, would be given consideration promptly after Congress adjourned. I also advised you that it was understood that acquiescence in the program would not prejudice the right of the reserve banks to resume issuing 1928 notes in case you were not autho- rized to replace them. On January 3, 1936, Mr. Coolidge [Under Secretary] wrote me that he had noted the conditions referred to above and that he had instructed the Bureau of Engraving and Printing to cease delivery of 1928 notes [and to cease working on any in the process of completion]. The reserve banks were requested by the Board to make no further issues of new 1928 notes and orders were placed by the banks for 1934 notes to meet normal requirements. Incomplete and unissued Series of 1928 notes languished in the Bureau of Engraving and Printing, and unissued notes clogged the vaults of the Treasury and Federal Reserve Agents for the next 10 years. A letter from Fiscal Assistant Secretary Bartlet to new Secretary of the Treasury Fred Vinson dated February 1, 1946, advised that the following quanti- ties still remained: Location Value Number of Notes Tons Treasury $2,812,100,000 116,658,460 120 Reserve Agents $1,291,755,000 55,304,796 50 BEP incomplete $382,706,500 8,190,576 8 In addition, there were packages previously issued to the banks by the Federal Reserve Agents that were not issued into circulation, but instead had been returned to the Agent’s custody. The Federal Reserve Board recognized that the Treasury would not look favorably on the release of the notes into circulation, but those holding them need- ed to clear them from their vaults and also desired to be relieved of having to safe- guard and account for them. Vinson signed off on their destruction on February 11, 1946, leaving one incomplete sheet of each denomination to be retained by the BEP as specimens. It is ironic that $626,796,750 million worth of unissued Series of 1929 Federal Reserve Bank Notes and $32,900,750 of previously redeemed but fit 1929 FRBNs from the 1933-4 issuances were pressed into circulation as an economy measure at the end of 1942 and into 1944. The Treasury favored this move because the redemption clause on the FRBNs did not mention gold. There were seven times as many 1928s that were wasted on the basis of their gold clause. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 114 Paper Money • March/April 2010 • Whole No. 266 115 Series of 1934 Silver Certificates The free silver clause in the Gold Reserve Act, the dream of the populists for over half a century, was: The President, in addition to the authority to provide for the unlimited coinage of silver . . . is further authorized to cause to be issued and delivered to the tenderer of silver for coinage, silver certificates in lieu of the standard silver dollars to which the tenderer would be entitled. ... The president is further authorize to issue silver certificates in such denominations as he may prescribe against any silver bullion, silver, or standard silver dollars in the Treasury not then held for redemption of any outstanding silver certificates, and to coin standard silver dollars or subsidiary currency for the redemption of such silver certificates. . . . The president is authorized, in addition to other powers, to reduce the weight of the standard silver dollar in the same percentage that he reduces the weight of the gold dollar. Six months later, Roosevelt sent the following memo. June 14, 1934 The Honorable Secretary of the Treasury (Henry Morgenthau Jr.) My Dear Mr. Secretary: Pursuant to the authority vested in me by the act approved May 12, 1933, as amended by the Gold Reserve Act of 1934, I hereby authorize and direct the issuance of silver certificates, pursuant to law, in any or all of the following denominations, $1, $5, $10, $20, and $100, against any and all silver bullion or standard silver dollars now in the Treasury not held for redemption of any outstanding silver certificates. Sincerely yours, Franklin D. Roosevelt And thus was born the Series of 1934 silver certificates, the most attractive series of small size United States currency ever printed. The $1, $5 and $10 denominations nicely dress up your many collections, but fate would have it that the Treasury never got around to printing, let alone issuing, the fabulous $20s and $100s. Figure 25. Notice that the obliga- tion printed on the Series of 1928 silver certificates, and also on Series of 1933, states that they are payable in silver coin. (Photo cour- tesy of the National Numismatic Collection, Museum of American History, Smithsonian Institution) *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 115 Paper Money • March/April 2010 • Whole No. 266116 What, of course, they were doing was monetizing the unobligated silver stocks, both coin and bullion, in the Treasury, at an inflated dollar value, and pumping that new money into what they perceived was a cash-starved depression economy. The public already was used to silver certificates, because they had been in circulation since 1878, so they circulated without resistance. The idea that coins represented a value denominated in silver already was well entrenched in the public mind, so more silver in the form of Series of 1934 notes did not pose a hurdle. The difference between the Series of 1934 and the earlier 1928 and 1933 series was that many of the notes were backed by silver bullion instead of silver dollars, consequently the obligations on them changed from payable in coin to a revised “in silver payable on demand.” Consequently, the last people in line received silver granules or bars rather than silver dollars during the great silver certificate redemption run in 1968, before the Treasury shut off redemptions on June 24th. The Silver Purchase Act, an act requested by Roosevelt, was passed on June 19th, five days after Roosevelt authorized the Series of 1934 silver certifi- cates. It directed the Secretary of the Treasury to purchase silver at home or abroad “whenever and so long as the proportion of silver in the stocks of gold and Figure 26. The Series of 1934 silver certificates resulted from the so- called free silver provisions in the Agricultural Adjustment of 1933 and Gold Reserve Act of 1934 that allowed for the unlimited minting of silver. The Gold Reserve Act allowed them to be backed by bullion as well as coin. Notice that they state that they are payable in silver, but not necessarily coin. (Photo courtesy of Mike Abramson) Figure 27. $20 Series of 1934 and 1934A silver certificate production plates were made between 1934 and 1942, but never used, probably to avoid sorting them from Federal Reserve Notes when they came in for redemption. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 116 Paper Money • March/April 2010 • Whole No. 266 117 silver of the United States is less than one-quarter of the monetary value of such stocks” and “such certificates shall be placed in actual circulation.” Of course, the objective of this act was to support the price of silver, which was faltering, a sub- sidy to domestic producers, and to further inflate the currency supply. The future revealed that small denomination silver certificates, mostly $1s and $5s, would do the heavy lifting in terms of meeting the needs of small denomination notes for the next 29 years. Initially, $20 and $100 silver certificates were in the works. The fact is that standard 12-subject production plates were made for both in 1934 bearing Julian-Morgenthau signatures. The idea of issuing $20s persisted, so some new plates were added to the inventory in 1936, and even 1942. In fact, the last three plates made in 1942 were Series of 1934A. The Series of 1934 $20 and $100 plates proved to be a wasted effort. Federal Reserve Notes carried the higher denomination load, so the higher denomination silvers were never printed, probably to avoid having to sort them from the Federal Reserve Notes when redeemed. The New Order The Agricultural Adjustment Act of 1933 made all coins and currency issued under the authority of the United States legal tender. This included national bank notes which previously were not accorded legal tender status, but which were convertible into legal tender notes. All currency plates made there- after carried appropriate language to that effect, including Series of 1928C legal tender notes and Series of 1934 gold certificates, silver certificates and Federal Reserve Notes. Only the emergency Series of 1929 Federal Reserve Bank Notes didn’t carry a legal tender clause, because the preprinted national bank note stocks from which they were made had an old redemption clause wherein the bearer could redeem the note at the bank of issue or Treasury for lawful money. Lawful money from the days of the Civil War was defined as legal tender notes, but after the resumption of specie payments in 1879, legal tender notes could be converted into gold until 1933. Most of the 1929 FRBNs were printed before passage of the Agricultural Adjustment Act, so the legal tender clause was not an issue when they were printed anyway. The question was, what could you get if you desired to redeem U. S. cur- rency after 1934? The Treasury was obligated only to redeem silver certificates in silver, and not necessarily with silver coin at that. This they did until June 24, 1968. A year earlier, President Lyndon Johnson signed into law authorization for the Treasury to terminate silver redemptions a year later. Redemptions were made at the U. S. Assay Offices in San Francisco and New York. Long lines of certificate holders snaked around the sidewalks at the Figure 28. A great near miss for numismatists was the fact that the production plates made in 1934 for $100 Series of 1934 silver certificates never were used. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 117 Paper Money • March/April 2010 • Whole No. 266118 assay offices to exchange their notes for silver during the final days. The assay offices issued small envelopes each valued at $1 containing 0.77 ounces of fine silver in the form of crystals or pellets for small transactions. Plastic bags of silver gran- ules or bars of silver were used to settle larger transactions. The standard bar var- ied in weight from 1,000 to 1,100 ounces at $1.2929 per fine troy ounce (Coin World, current). If you sent a $10 Federal Reserve Note to the Treasury for redemption, the most likely outcome was that the Treasury would return two $5 legal tender notes prior to 1968 when $5 legal tender notes were phased out. The New Deal wizards created money to support their programs to spur recovery from the Great Depression, and then to execute World War II, using all manner of techniques, imagination and guile, and succeeded grandly in increasing the money supply. The biggest early creation of money occurred when Roosevelt had everyone turn over their gold to the Treasury, then increased the value of that gold and used the paper increase to infuse the Treasury with $3 billion in new but deflated dollars to support his economic recovery plans and currency stabilization programs. Labor was valued at a dollar or so per hour when the New Dealers came into office, provided one could find a job, so a billion dollars then represented an astronomical sum of money. Roosevelt and his Treasury took the United States off the gold standard, which already was a dying concept on the interna- tional scene and excoriated at home by pop- ulists who saw it as the yoke tied to the working man and farmer. Roosevelt and his colleagues presided over the beginning of the era of big government, which included the creation of large social programs such as the ever popular social security program and the massive spending required to support it. Both have been with us ever since. A primary objective during the early years of the Roosevelt administration was to boost employment. Ironically, free marketer Burton Folsom quotes testimony by consummate administrative insider Julian Morgenthau before the House Ways and Means Committee in May 1939, as say- ing: "We are spending more money than we have ever spent before and it does not work. I want to see this country prosperous. I want to see people get jobs. We have never made good on our promises. I say after eight years of this administra- tion we have just as much unemployment as when we started and an enormous debt to boot." The same administration fought and financed World War II. The war solved the unemployment problem. Of course, most of the money they needed came from taxes and deficit spending funded by borrowing through bond sales. The inevitable inflation would allow for paying off those debts, if indeed they ever were paid off, using the cheaper dollars of the future. Henry Morgenthau Jr., Roosevelt’s long serving (1934-45) Secretary of the Treasury, supervised without scandal the spending of $450 billion, three times more money than had passed through the hands of his 51 predecessors combined (Encyclopedia Britannica, current; Jewish Virtual Library, current). The typical American generally has enjoyed the most sustained period of prosperity coupled with a rising standard of living ever since, and the country has held onto its status as the richest, most powerful and most influential nation on earth. Figure 29. Henry Morgenthau Jr., a man of unimpeachable integrity, served as President Roosevelt’s Secretary of the Treasury from 1934 until 1945. He oversaw the total restructuring of the money system used by the United States, unprecedented budgets and emer- gence of the United States as the wealthiest nation on the earth. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 118 Now available Ron Benice “I collect all kinds of Florida paper money” 4452 Deer Trail Blvd. Sarasota, FL 34238 941 927 8765 Benice@Prodigy.net Books available mcfarlandpub.com, amazon.com, floridamint.com, barnesandnoble.com, hugh shull Paper Money • March/April 2010 • Whole No. 266 119 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" $21.60 $38.70 $171.00 $302.00 Colonial 5-1/2" x 3-1/16" $22.60 $41.00 $190.00 $342.00 Small Currency 6-5/8" x 2-7/8" $22.75 $42.50 $190.00 $360.00 Large Currency 7-7/8" x 3-1/2" $26.75 $48.00 $226.00 $410.00 Auction 9 x 3-3/4" $26.75 $48.00 $226.00 $410.00 Foreign Currency 8 x 5 $32.00 $58.00 $265.00 $465.00 Checks 9-5/8 x 4-1/4" $32.00 $58.00 $265.00 $465.00 SHEET HOLDERS SIZE INCHES 10 50 100 250 Obsolete Sheet End Open 8-3/4" x 14-1/2" $20.00 $88.00 $154.00 $358.00 National Sheet Side Open 8-1/2" x 17-1/2" $21.00 $93.00 $165.00 $380.00 Stock Certificate End Open 9-1/2" x 12-1/2" $19.00 $83.00 $150.00 $345.00 Map & Bond Size End Open 18" x 24" $82.00 $365.00 $665.00 $1530.00 You may assort note holders for best price (min. 50 pcs. one size). You may assort sheet holders for best price (min. 10 pcs. one size). 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 See Paper Money for Collectors www.denlys.com Harlan J. Berk, Ltd. “The Art & Science of Numismatics” 31 N. Clark Street Chicago, IL 60602 312/609-0016 • Fax 312/609-1305 www.harlanjberk.com e-mail: info@harlanjberk.com A Ful l -Serv ice Numismat ic F irm Your Headquarters for Al l Your Col lect ing Needs PNG • IAPN • ANA • ANS • NLG • SPMC • PCDA HARRY IS BUYING NATIONALS — LARGE AND SMALL UNCUT SHEETS TYPE NOTES UNUSUAL SERIAL NUMBERS OBSOLETES ERRORS HARRY E. JONES 7379 Pearl Rd. #1 Cleveland, Ohio 44130-4808 1-440-234-3330 *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 119 Paper Money • March/April 2010 • Whole No. 266120 Acknowledgments Lee Lofthus provided invaluable assistance by introducing me to the his- toric files of the Bureau of Public Dept that reside in the National Archives, and by locating within them crucial documents pertaining to the issuance of the currency considered here. Lofthus also critically reviewed this article and made many sug- gestions that resulted in substantial changes and additions. James Hughes, associ- ated curator, National Numismatic Collection, Museum of American History, Smithsonian Institution, provided access to many of the relevant issued notes and certified proofs illustrated here. References Cited and Sources of Data Alter, Jonathan. The Defining Moment, FDR’s Hundred Days and the Triumph of Hope. New York: Simon & Schuster, 2006, 414 p. Awalt, Francis Gloyd. “Recollections of the Banking Crisis in 1933,” Banking History Review, v. 43, no. 3 (1969), Harvard College, p. 347-371. Brasschecktv, current, Roosevelt’s March 12, 1933 fireside chat: http://www.brasschecktv.com/page/438.html Bureau of Engraving and Printing. Certified proofs, 1863-1985. National Numismatic Collection, Museum of American History, Smithsonian Institution, Washington, DC. Bureau of Engraving and Printing. Plate history ledgers for small size currency undated. Record Group 318, U. S. National Archives, College Park, Maryland. Bureau of Public Debt. Series K Currency, various dates. Record Group 53 (Gold Certificates: 53/450/54/01/07 box 14 K121 & Federal Reserve Notes: 53/450/54/01/05 box 9 file K422.1), U. S. National Archives, College Park, MD. Butkiewicz, James. “Reconstruction Finance Corporation,” http://eh.net/encyclo- pedia/article/butkiewicz.finance.corp.reconstruction Coin World. “About Paper Money, Small-size Silver Certificates,” http://www.coinworld.com/NewCollector/PaperMoney/About/ Small_SilverCert.aspx Congressional Record, Feb 14, 1933, 76th Congress. Encyclopedia Britannica, http://www.britannica.com/EBchecked/ topic/392326/Henry Morgenthau Jr Folsom Jr., Burton W. New Deal or Raw Deal?, How FDR's Economic Legacy Has Damaged America. Threshold Editions. New York: Simon & Schuster, Inc., 2008, 318 p. Jewish Virtual Library. http://www.jewishvirtuallibrary.org/jsource/ biography/Morgenthau.html Knox, John Jay, Bradford Rhodes, and Elmer Youngman. A History of Banking in the United States. New York: Bradford Rhodes & Company, 1903, 880 p. Parks, Larry. http://www.fame.org/PDF/White%20House%20Statement% 20on%20Proclamation%202072.pdf Pole, John W. Annual reports of the Comptroller of the Currency. Washington, D.C.: Government Printing Office, 1930, 783 p. Shafer, Neil. A Guide Book of Modern United States Currency, 2nd ed. Whitman Publishing Company, Racine, WI, , 1967, 160 p. United States Statutes. Washington, D.C.: Government Printing Office, various dates. v *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 120 Paper Money • March/April 2010 • Whole No. 266 121 *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 121 Paper Money • March/April 2010 • Whole No. 266122 H ELEN A. CLARK AND HER DAUGHTER-IN-LAW, ELLA M. Clark, served as successive presidents of The Pulaski (NY) National Bank from 1887 to 1904. They were among the earliest woman national bank presidents, and one of the few instances where a nation- al bank had two women presidents. Pulaski is a village in Oswego County in central New York, about 40 miles north of Syracuse. It was named to honor Casimir Pulaski, the Polish soldier who fought and died in the American Revolution. Incorporated in 1832, by 1900 its population was 1493. The Pulaski National Bank was founded in 1865 (charter #1496), an outgrowth of the J. A. Clark and Company’s Bank. Helen A. Lam was born in Oswego County on April 22, 1823. She mar- ried James A. Clark in 1845. He was the founding cashier of The Pulaski National Bank in 1865, and became its president in 1884. At his death in 1887, she assumed the presidency, serving until her death on July 22, 1893. Her obituary noted that as a widow, she “lived a quiet and retired life with special devotion to her family.” With her death, Ella M. Clark succeeded to the presidency. She was the wife of Helen’s son, Louis, who was then the cashier of the bank. She had been born Ella M. Klock on November 5, 1854, and married Louis Clark in 1874. Ella served as president for about a decade, relinquishing the presidency to her husband in 1904. At that time their son, Frederick, now in his 20s, became the cashier. She died in Pulaski on July 23, 1931. An Historical Souvenir of Pulaski (1902) noted that the bank was owned entirely by the members of one family. It occupied a handsome building built in 1882 after a fire had destroyed the downtown in 1881. The booklet also noted, “The president has for her private office a handsomely fitted up room, and lady patrons are provided with an apartment exclusively for transacting their business with the bank.” The bank closed on July 8, 1932, a victim of the Depression. The build- ing, though, has continued to house later banks in the village. Today a branch of Community Bank, N. A. occupies the space. It is interesting to note that Helen A. Clark’s daughter, Nellie T. (Clark) Peck, also served as a national bank president, in the nearby village of Mexico, NY. (An article on her appeared in Paper Money, issue number 246, November/December 2006.) Helen A. Clark and Ella M. Clark National Bank Presidents By Karl Sanford Kabelac *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 122 PROLIFIC PAPER MONEY AUTHORand SPMC member Joaquin Gil del Real Irizarry pours a lifetime of his origi- nal, archival research into his new histori- cal volume on Panama’s paper money Algunos Comentarios sobre El Papel Modeda y la banca en Panamå. Readers of this journal are already familiar with the Cuban native’s detailed research on 19th and early 20th Century bank notes and scrip of his adopted country. Dozens of his articles have appeared in these pages over the last 15 years, and more on on tap. During this time, the author has also been contributing articles to Spanish-lan- guage periodicals. Gil brings his same rigor- ous study to the present volume, published by Universal Books, Panama in Spanish. Chapters cover the paper antecedents of the isthmus, scrip of the Central American Steam Navigation Co., bank notes of the early private bankers of Panama, govern- ment treasury notes, notes of the Republic, and an exhaustive listing of laws relating to money. A special chapter “Panama Girl” discusses the use of the Nina Panama vignette on large U.S. $50 Federal Reserve Note backs. All chapters are thoroughly documented by footnotes. A graduate of the American Graduate School of International Management, and the University of Southern California, Gil has been pursuing the history of Panama’s money since he moved there in 1959. The soft-cover book features excellent color illustrations, historical photos, and extracts of legislation. It may be ordered from the author for $25 U.S. plus $3.50 postage at Apartado 0832-00933, Panama, Republic de Panama. Airmail delivery from Panama can take “10 to 15 days more or less,” the author notes. -- Fred Reed v Paper Money • March/April 2010 • Whole No. 266 123 Sources and Acknowledgments Grip’s Historical Souvenir of Pulaski (1902) was useful for its sections on The Pulaski National Bank and James A. Clark. The Landmarks of Oswego County (1895) contained helpful sections on Louis J. Clark and banking in Pulaski. An obituary for Helen A. Clark appeared in The Pulaski Democrat in late July 1893 (the clipping is undated), and one for Ella M. Clark appeared in the same newspaper on July 29, 1931. The help of Mary Lou Morrow of the Pulaski Historical Society is gratefully acknowledge. Pat Ellebracht shared research on the Clarks provided to him by Mary E. Parker, the Town of Richland Historian, which was also much appreciat- ed. v The Pulaski National Bank, c. 1905. Designed by Syracuse architect, Archimedes Russell, it was built after an 1881 fire destroyed downtown Pulaski. The bank was on the right side, the vil- lage post office on the left. Today the entire building, still looking much as it did a century and more ago, houses a branch of Community Bank. Joaquin Gil del Real pens book on Panama’s paper money *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 123 Paper Money • March/April 2010 • Whole No. 266124 Introduction Minnesota’s Act to Authorize and Regulate the Business of Banking was signed into law on July 26, 1858, and repealed a banking act that had been passed along with the original Minnesota statehood statutes earlier in the year. The banking system was patterned after New York’s Free Banking Act, which allowed persons entry into the banking business free of special legislative permission. The second Act was amended the following month to support the new Minnesota rail- road bonds, known as Minnesota 7s for the interest rate paid. The American Bank Note Company in New York was the exclusive engraver of plates for the newly formed banks. Mr. S. J. Dennis, a bank agent for Minnesota in New York, kept the printing plates in custody when they were not being used for production. American Bank Note was to deliver all printed notes to the state Auditor, who would distribute notes to the banks after the proper col- lateral securities were deposited in his office. Several banks immediately proceeded to file articles of incorporation with state Auditor W. F. Dunbar, and contract with American Bank Note to make plates and print notes for their circulation. There were 23 banks that filed by the end of 1858. Among the first group that took immediate advantage of the new law were the State Bank of Minnesota in Austin, the Farmers Bank in Garden City, and the Bank of Saint Paul. In 1859, the Bank of Red Wing also opened for business. These banks were short-lived, issuing notes over a period of just months. It wasn’t until 1862 that new banks emerged and used altered ver- sions of the plates of these four banks for their circulation. This study examines the use of recycled plates in bank note production. Background On August 14, 1858, the Minnesota Legislature amended the state’s banking act. The main purpose of the amendment was to support the Minnesota railroad bonds. As the law was originally written, only federal or state bonds which had traded in New York were permitted to be accepted by the state Auditor for backing a bank’s circulation. The average sales rate over the prior six months was the rate at which the Auditor could accept such bonds. Since the railroad bonds were a new issue without a record of public trading, they could not be deposited with the state Auditor. The change allowed federal and Minnesota state bonds, including the railroad bonds, to be accepted by the Auditor at their “current value.” These sub- jective words would become the crux of the problem with the Minnesota banking system. After the amendment, several new banks deposited railroad bonds with the state Auditor. Initially, they were accepted at par value. In reality, the bonds were highly illiquid and those people with interest in the railroads who had large holdings used them to organize free banks. They traded at rates far less than their nominal value. The legislature’s amendment also had the unintended effect of reducing the capital requirements for entry into banking in the state. While the nominal capital had to be at least $25,000, acceptance of the Minnesota 7s allowed a bank to be organized for considerably less in real terms. If a bank was capitalized solely with the railroad bonds, its intent in choosing this portfolio may have been to Recycling of Bank Note Plates for Minnesota’s Free Banks By R. Shawn Hewitt *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 124 Paper Money • March/April 2010 • Whole No. 266 125 afford entry into the banking system. However, the overall result of permitting Minnesota 7s to be used for backing was the failure of Minnesota banks to maintain credibility and a legiti- mate circulation. Several banks deposited Minnesota 7s for their circulation and issued currency to the full nominal value of the bonds, or the maximum permit- ted by the Auditor, as swiftly as possible. As the real market value of the railroad bonds became apparent, notes of these banks became heavily discounted. By spring 1859, nearly all Minnesota notes became uncurrent at any dis- tance from their home banks. Saint Paul brokers were successful in buying notes at a discount and then returning them to the issuing bank for redemption in coin. Several refused payment, and the first failures were recorded. The June 23, 1859 edition of the Saint Paul Weekly Pioneer and Democrat published in detail the secu- rity behind each of the fourteen operating banks of issue. After this time, it seems that the public was better able to flesh out the banks that would honor their circulation at par. The four banks in our study were among the more responsible banks, but all found it impossible to keep their notes afloat. No new bank notes would be released by the state Auditor for about two years after the late summer of 1859. Several banks chose to wind up their affairs and return their circulation on hand to the Auditor’s office to reclaim their bonds on deposit. By the beginning of 1860, all the Minnesota banks that held mar- ketable bonds in their portfolios either closed their doors or substituted Minnesota 7s. In accordance with Section 37 of the banking act, the Auditor destroyed plates of six banks that failed on May 10, 1860. Only six banks remained by the end of the year. By the end of 1861, all four of the banks in this study were defunct, and their notes recalled by the state Auditor for redemption. In this year the Auditor was authorized to accept U.S. five per cent bonds, whereas previously six per cent bonds were required. Three new banks were established in 1862 with U.S. 5-20s or other unquestioned securities as their basis, as would be the case with all the banks created thereafter. By 1863, three of the original railroad banks still had Minnesota 7s on deposit with the Auditor, but they were on the books at the rate of 18 cents per dollar. State Bank of Minnesota Byron W. Clarke of Milwaukee and J. J. McCullough of Saint Paul filed for the organization of the State Bank of Minnesota in Austin on August 16, 1858, the first day for which the Auditor accepted applications for the free banks. Austin is located along the Iowa border in southern Minnesota. The bank was capitalized at $25,000, all but one of its 250 shares belonging to Mr. Clarke. Mr. A. L. Pritchard of Watertown, Wisconsin, who would later become the sole shareholder, was named president. Mr. A. M. Pett was cashier. When it placed its order with American Bank Note, the bank chose a sheet configuration of 1-2- 5-5 for its currency. The plates were in the hands of Agent Dennis by November 29. The State Bank of Minnesota opted to make a conservative approach in its banking affairs. It purchased relatively safe Ohio 6s to back its circulation. These bonds, or public stocks as they were known, were broadly traded and worth par or more. This was the kind of backing that successful banks in other states used as collateral. Between April 9 and 12, the State Bank of Minnesota received a shipment of bank notes amounting to its full capitalization from the state Auditor. These notes were countersigned by him, and after the notes were signed by the bank’s president and cashier, they could be issued for circulation. No subsequent shipments of notes were ever sent to the State Bank. In newspaper commentaries and personal correspondence, the officers fought to defend the reputation of the bank. The motivation of those seeking to *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 125 Paper Money • March/April 2010 • Whole No. 266126 discredit this bank may have varied, but some were undoubtedly hoping to obtain its notes at a steep discount, and submit them to the bank for redemption in specie. The Pioneer and Democrat quoted State Bank notes at a 5% discount in August. Banker J. C. Easton of Chatfield purchased $309 of State Bank notes for $300 in New York exchange from banker Thomas Bennett of Winona in early November. Easton undoubtedly sent them to Austin for redemption. Four years later Bennett would organize his own free bank in Winona. Despite a sound backing for its currency, the bank conceded the battle and sought to wind up its affairs. A notice of closing for this bank was filed with the Auditor on December 10, 1859. Its circulation was reduced to $1,040; a sin- gle Tennessee 6 and $214 in specie were left with the Auditor to redeem its out- standing notes, which he did at par. However, the State Bank of Minnesota did not perish. A special Act of the Legislature in 1862 caused what remained of the bank to move to Minneapolis, about 100 miles to the north, but it was effectively a new institution. The new stockholders were Messrs. R. J. Baldwin and R. J. Mendenhall, each putting up half of the $25,000 capital. Mendenhall, a Minneapolis banker, issued his own fractional scrip and endorsed the scrip of the Treasurer of Minneapolis the same year. American Bank Note removed the Austin location on the plate and replaced it with Minneapolis. Since the State Bank of Minnesota in Austin hon- ored its circulation at full face value, there was not only an economy of recycling the bank note plate, but also a benefit of taking on the goodwill associated with the name. Mendenhall served as president, and Baldwin served as cashier in this reincarnation of the bank. As with all banks to organize in 1862 and later, its notes were redeemed at par. The state Auditor included the outstanding circulation of the first State Bank with that of the second in his books, and no differentiation was made Illustrated below are issued examples of $2 notes from the State Bank of Minnesota in Austin, and the State Bank of Minnesota in Minneapolis. The main printing plates were identi- cal except for the location and date. The Austin bank used a red panel security overprint, whereas Minneapolis used no overprint. Like most notes issued in 1862 and later, the serial number was mechanically imprinted. The Austin note was signed by A. M. Pett as cashier and A. L. Pritchard as president. The Minneapolis note was signed by R. J. Baldwin as cashier and R. J. Mendenhall as president. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 126 Paper Money • March/April 2010 • Whole No. 266 127 between the notes of either bank upon redemption. Illustrated opposite are issued examples of $2 notes from the State Bank of Minnesota in Austin, and the State Bank of Minnesota in Minneapolis. The main printing plates were identical except for the location and date. The Austin bank used a red panel security overprint, whereas Minneapolis used no overprint. Like most notes issued in 1862 and later, the serial number was mechanically imprinted. The Austin note was signed by A. M. Pett as cashier and A. L. Pritchard as president. The Minneapolis note was signed by R. J. Baldwin as cashier and R. J. Mendenhall as president. Farmers Bank Three days into the Minnesota free banking era, Julius H. Dawes of Fox Lake, Wisconsin, filed for the organization of the Farmers Bank in Garden City, also with a capitalization of $25,000. Stockholders would later include John W. Davis, William E. Smith and William J. Dexter, all of Fox Lake. The Farmers Bank selected a 1-2-3-5 layout for its bank note plate. Agent Dennis had posses- sion of the plate on December 29, 1858. It also chose a fairly conservative portfolio, selecting Minnesota 8s, which traded well above par in New York. On January 20, the Farmers Bank received $25,000 of notes signed by the Auditor and authorized for issue. This was the bank’s only shipment. The Pioneer and Democrat reported on March 24, 1859, that Saint Louis banks would accept no Minnesota notes on deposit other than those of the Farmers Bank. In August, the same newspaper quoted Farmers Bank notes trad- ing at a 5% discount for exchange. Yet, the Farmers Bank found it unprofitable to maintain a circulation. On October 26, 1859, the Mankato Weekly Record reported the bank’s intention to close. The date of notice recorded in the Auditor’s office was April 21, 1860. This may be the date that its notes were first protested. Again, notes were redeemed at par. A new Farmers Bank, this one located in Mankato, an emerging center of economic activity just 14 miles northeast of Garden City on the Minnesota River, was organized on May 7, 1862. William J. Dexter, a stockholder of the former institution, filed the application with the Auditor’s office. Mr. Dexter authorized American Bank Note to change the location on the printing plates and ordered notes to be printed. However, the second Farmers Bank did not issue any notes. In the summer of 1864, David L. How and Foster L. Balch opened a third Farmers Bank for business in the village of Shakopee, about 50 miles down- stream the Minnesota River, but to the northeast of Mankato. They were both from Shakopee, and each put up half of the $27,500 in capital. Less than two years earlier, D. L. How issued fractional scrip in his town to help alleviate the ongoing small change shortage. Their connection with the Fox Lake financiers is unknown. Messrs. How and Balch acquired the Farmers Bank plate and had American Bank Note change the location, this time from Mankato to Shakopee. The date on the plate was also changed to September 1st, 1864. The Farmers Bank of Shakopee was the last free bank to organize in the State of Minnesota. Notes were first received from the Auditor’s office on September 12, 1864, and the last notes were received just more than a year later, as the free banking era came to a close. Shown on the next page are issued $2 notes from the Farmers Bank of Garden City and the Farmers Bank of Shakopee, and a falsely filled-in remainder of the Farmers Bank of Mankato. In 1862 the Garden City plate was altered to Mankato for a bank that never opened. The Shakopee bank opened in 1864, and was among the last of the Minnesota free banks. Signers on the Garden City note are J. H. Dawes as cashier and an unidentified signer as vice president. Although *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 127 Paper Money • March/April 2010 • Whole No. 266128 the signatures are faded, the Shakopee note was likely signed by Foster Balch as cashier and D. L. How as president. Bank of Saint Paul T. Romeyn B. Eldridge of Milwaukee filed to organize the Bank of Saint Paul on the same day as the Farmers Bank, also with a capitalization of $25,000. After Eldridge moved to Saint Paul, he increased the capital and sold shares to his banking associates. By June 1860, there were 36 stockholders in the bank. The Bank of Saint Paul opted for a 1-2-5-10 plate arrangement, and the plates were in the custody of Agent Dennis on December 14, 1858. The Bank of Saint Paul initially chose Ohio 6s for its portfolio. It received its first shipment of $25,000 in signed notes from the Auditor on January 15, 1859. It received its last shipment on June 21. Notes were quoted at 21⁄2% to 3% discount in August. A huge embarrassment befell Minnesota banking when certain informa- Above are $2 notes from the Farmers Banks of Garden City, Mankato and Shakopee. In 1862 the Garden City plate was altered to Mankato for a bank that never opened (center). The Shakopee bank opened in 1864, and was among the last of the Minnesota free banks. Signers on the Garden City note are J. H. Dawes as cashier and an unidentified signer as vice presi- dent. Although the signatures are faded, the Shakopee note was likely signed by Foster Balch as cashier and D. L. How as president. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 128 Paper Money • March/April 2010 • Whole No. 266 129 tion became public knowledge on October 20, 1859. It was reported the following day in the Pioneer and Democrat that the Bank of Saint Paul had withdrawn its Ohio 6s from the Auditor’s office and deposited Minnesota railroad bonds in their stead some two months earlier. The Auditor was immediately decried for allowing a switch to occur. The same day he released a statement showing the security and circulation of each of the banks, in order to head off a general panic, and then issued a statement in his defense. He stated that $30,000 of Minnesota 7s was in place to secure $12,000 in outstanding circulation. This, along with personal bonds amounting to $6,250 and stockholder liability, he deemed ample security to the noteholders. By December, a resolution in the House of Representatives was adopted that called to inquire whether the Auditor had subjected himself to impeachment. W. F. Dunbar served as state Auditor through the end of 1860. The Bank of Saint Paul survived this event, although on June 22, 1861, it declined to redeem its notes. This prompted the Auditor to sell the collateral securities, and subsequently pay noteholders 98 cents on the dollar for notes pre- sented for redemption. Brothers Horace and James E. Thompson of Saint Paul organized the Bank of Stillwater in 1863, in a village about 20 miles to the northeast of Saint Paul. This was their second banking venture, as the brothers had opened the Bank of Minnesota in Saint Paul the previous year. They, along with Minnesota State Treasurer Charles Scheffer, capitalized the Stillwater bank with $50,000. The retired plate of the Bank of Saint Paul was resurrected to serve the Stillwater bank. A more significant re-engraving effort was required to transform the words “Saint Paul” into “Stillwater” twice on each note. The Bank of Stillwater received its first order of notes on September 4, 1863 and its last on January 21 of the following year. Shown above are issued $5 notes from the Bank of Saint Paul and the Bank of Stillwater. The Saint Paul bank used a red overprint on its notes, while Above are issued $5 notes from the Bank of Saint Paul and the Bank of Stillwater. The Saint Paul bank used a red overprint on its notes, while the Stillwater bank used a green overprint, which was more common on late issues of obsolete bank notes. Signers on the Saint Paul note are C. J. Burnell as cashier and T. R. B. Eldridge as president. The Stillwater note is signed by Charles Scheffer as cashier and Horace Thompson as president. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 129 Paper Money • March/April 2010 • Whole No. 266130 the Stillwater bank used a green overprint, which was more common on late issues of obsolete bank notes. Signers on the Saint Paul note are C. J. Burnell as cashier and T. R. B. Eldridge as president. The Stillwater note is signed by Charles Scheffer as cashier and Horace Thompson as president. Bank of Red Wing Charles W. G. Joernz, a resident in the village of Red Wing, filed an application on May 6, 1859, to organize the Bank of Red Wing with a capitaliza- tion of $25,000. Its chosen sheet layout was 1-2-3-5. Agent Dennis had the plates on June 4, 1859. This bank was one of eleven applications made in 1859, the last of which was filed in July. No more banks would organize for three years. The Bank of Red Wing opted to use Minnesota 7s as a low-cost means to gain entry into the free banking system. It received its first shipment of notes on June 29 and its last less than a month later. The bank issued notes to the maxi- mum that the Auditor would allow, with a peak circulation of $23,100 against $27,000 in Minnesota 7s in October. Despite the poor backing, it always redeemed its notes in specie and its notes were never protested. However, its life was brief, and its notes never claimed a broad circulation. A notice of closing was filed with the Auditor on October 31, 1859. By December 1, its circulation was reduced to $1,368 against $2,000 in Minnesota 7s. Its notes were redeemed at par by the state Auditor after it closed for business. In 1863, $811 of its notes was outstanding. Pascal Smith of Red Wing and Wells S. Dickinson of Bangor, New York, operated the Banking House of Smith & Dickinson in Red Wing. In 1862, they issued fractional scrip to facilitate trade in their town, but the next year they decided to convert their banking operation into a free bank. The second Bank of Red Wing was capitalized with $27,500. They procured title to the plate of the former Bank of Red Wing from Mr. Joernz, and authorized American Bank Note to print new notes, these with Illustrated below are examples of $1 notes from the first and second Bank of Red Wing. The first bank used a red overprint for its notes and no design for the back. The second bank had their notes printed with a green overprint and green back. The only alteration of the engraved plate was the date. The second issue Red Wing note was signed by Pascal Smith and W. S. Dickinson. *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 130 Paper Money • March/April 2010 • Whole No. 266 131 green backs and a green overprint, but with no alterations of the plate. Shortly after the first printing run, the plates were changed to have an engraved date of November 10th, 1863. It is likely that the second Bank of Red Wing redeemed notes of the first bank. Illustrated opposite are examples of $1 notes from the first and second Bank of Red Wing. The first bank used a red overprint for its notes and no design for the back. The second bank had their notes printed with a green over- print and green back. The only alteration of the engraved plate was the date. The second issue Red Wing note was signed by Pascal Smith and W. S. Dickinson. Conclusion While a few examples of legitimate bank plate alterations and recycling are known elsewhere, the free banks of Minnesota demonstrated an unusually high use of this practice. There were three main reasons for this. The transient nature of the first round of banking in Minnesota caused them to be short-lived ventures. Plates were executed for these banks by the American Bank Note Company, were lightly used, and were retired when the banks closed after a short time. A second reason is the economy of altering a plate instead of executing a new one. According to pricing schedules, the cost to design and cut a new plate in 1858 was $500. Simple alterations could be made for considerably less cost. A final reason for a new bank to recycle an old plate was to take advantage of the good reputation of the prior bank. The reputation they earned was exem- plified in a brief commentary about a Saint Paul dry goods dealer in the November 11, 1859, issue of the Pioneer and Democrat. “We are informed that Messrs. Ingersoll & Co., have decided to take State Bank at Austin, Farmers’s Bank, Garden City, and Bank of St. Paul, at par.” The State Bank of Minnesota, the Farmers Bank and the Bank of Red Wing redeemed their notes at par. Holders of notes from the Bank of Saint Paul suffered a mere 2% loss. Sources Mankato Weekly Record, Mankato, Minnesota. October 26, 1859. Minnesota. General Laws of Minnesota for 1858. Chapters XXXII and XXXIII. Minnesota, House of Representatives. “Auditor’s Report,” Journal of the House of Representatives of the Legislature of Minnesota, 1859 – 1860. Minnesota, State Auditor. Annual Report of the State Auditor to the Legislature of Minnesota, 1861–1866. Minnesota Historical Society. Auditor’s Records. Archives of the Minnesota Historical Society, Saint Paul, Minnesota. Minnesota Historical Society. Correspondence of J. C. Easton. Archives of the Minnesota Historical Society, Saint Paul, Minnesota. Patchin, Sydney A. “The Development of Banking in Minnesota,” Minnesota History Bulletin, vol. 2, no. 3 (August, 1917). Rolnick, Arthur J., and Weber, Warren E. 1988. “Explaining the Demand for Free Bank Notes,” Federal Reserve Bank of Minneapolis Quarterly Review, vol. 12, no. 2 (Spring, 1988). Saint Paul Weekly Pioneer and Democrat. March 24, 1859; June 23, 1859; August 12, 1859; October 21, 1859; October 28, 1859; November 11, 1859. Thompson’s Bank Note Reporter and Counterfeit Detector. 1859, various issues. Acknowledgments Special thanks to Eric P. Newman for the illustration of the $1 Proof note from the Bank of Red Wing. Thanks to Stephen E. Schroeder for valuable editorial assistance. Thanks to Spink-Smythe for the illustration of the $2 note from the Farmers Bank of Mankato. v *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 131 Paper Money • March/April 2010 • Whole No. 266132 I HAVE BEEN AWARE OF GREENBACKVILLE ON VIRGINIA'SEastern Shore for many years, but I just visited it this summer. It is a tiny waterfront village on the Maryland line in the extreme eastern end of Virginia. It is a bit out of the way on winding coun- try roads. Fishing, crabbing and oystering appear to be the main, or only, industry. The docks are home to charter fishing boats and commercial working boats. Opposite the docks are large piles of wire crab pots. There is a firehouse and probably 200 residents. A large golf resort is nearby. The village is at one end of a seaside hiking trail. Across the bay are the bar- rier islands, Chincoteague and Assateague, famous for their National Seashore preserve and for the wild ponies which graze and roam freely. Welcome to Greenbackville, Founded 1867 by Terry Bryan *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 132 Paper Money • March/April 2010 • Whole No. 266 133 Surrounding Accomack County is one of only two Virginia Counties that help comprise the DelMarVa Peninsula. The Chesapeake Bay is on the west, and the Atlantic Ocean is on the east. Some other interesting place names in Accomack County are Modest Town, Temperanceville, Onancock, Pungoteague and Wachapreague. The remote Tangier Island is a unique tourist site, home to hardy watermen with no cars allowed, and rather few changes in the last 400 years. The community of Greenbackville was founded in 1867. The area was strongly allied with the Confederacy, and the choice of name is surprising. The Website of the State of Virginia does not reveal the source of the name. v *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 133 Paper Money • March/April 2010 • Whole No. 266134 Dutch artist prefers colorful notes that look like play money IN PREVIOUS COLUMNS YOU HAVE READabout engravers who have hidden their initials within a bank note engraving, about security features that are only visible when you hold the note at a specific angle (a latent image as an example), and other devices that are there but not always obvious. The hidden initials are a personal statement of the designer or engraver and seldom get by the eyes of the person who approves of the finished design. Nevertheless, there have been exceptions. I recently found refer- ence to notes with very personal- ized marks: the fingerprint of the designer and a pet rabbit water- mark. Born in 1929, R.D.E. Oxenaar is a recognized graphic artist from the Netherlands who has lectured at the Academy in Den Haag and is consultant to the Danish Postal Service. This Dutch artist, who is called “Ootje,” believes in person- alizing the bank notes he designs. This came after Mr. Oxenaar spent two and a half years on his first bank note design. After all that time, “I really knew how to design a bank note.” When he completely understood what was necessary for a secure bank note and how he could create within this structure, subsequent designs came faster. The 250 gulden has a large vertical image of a lighthouse on the face and a much smaller image on the back. From a lecture by the artist and designer the following was found on the Internet. The rabbit image for the watermark on the 250-gulden bank note, P98 belonged to his girlfriend. “Everybody has to walk around with my rabbit in their pocket.” For this note and the 50 gulden, P96, Mr. Oxenaar had design assistance from J.J. Kruit. On the portrait of the philosopher Spinoza on the 1000-gulden bank note, P94 is the designer’s finger- print. “…my fingerprint to the left [is] the result of the combination of this hand-engraved part and the rest that was done by computer.” I was unable to scan the soft fingerprint or get a defined watermark with a scan- ner; you must examine the bank note to see both. During an interview on NOVA about counterfeit bank notes, Mr. Oxenaar had the following to say: “In the beginning, when I started [designing] bank notes, I saw all these bank notes everywhere in the world. You see that here, too, the French, the Italian, the Chinese -- they were very muddy in color. “The only bank notes that really inspired me, in fact, were play money, like the Monopoly money, and that is what I think is necessary for bank notes, too. I made things that you can easily see what you have in your hands, you can easily see they're very clear, they have a clear typography, [and] they have a clear color.” His design for the 50-gulden bank note, P96 is printed in bright colors; the dominant subject is a sunflower with a bee. When this note was first issued some people thought the note to be a fantasy piece. It didn’t take long for the imaginative Dutch to accept and approve of this note and subsequent designs in brilliant colors by Ootje Oxenaar. Unfortunately, the Euro has replaced the distinctive bank notes from the Netherlands. Nevertheless, perhaps other non-Euro countries will take advantage of Mr. Oxenaar’s expertise and engage him to design bank notes for them. Mr. Oxenaar has never confirmed this, but I have read in at least two dif- ferent publications that the designer placed the initials of his three daughters in the lighthouse on the 250 gulden note. If this was done, I have yet to find the initials. Reprinted with permission from Coin World, April 28,2003 A Primer for Col lec tors BY GENE HESSLER THE BUCK Starts Here Reports say that Dutch graphic artist R.D.E. Oxenaar placed the initials of his three daughters in this lighthouse on the 250 gulden, P98, note. v *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 134 Paper Money • March/April 2010 • Whole No. 266 135 IN THE 2000 CENSUS, FINGAL, NORTH DAKOTA(in Barnes County in the southeastern part of the state) had a population of 133 people. It must be one of the smallest communities in the nation to have a flour- ishing bank, which a century ago was the First National Bank of Fingal. And its president was a woman, Laura A. Batcheller. Laura A. Donahoe was born in Ontario, Canada, in 1873. Her family settled in eastern North Dakota when she was a child. She herself taught school for several years before her marriage to Charles E. Batcheller on June 28, 1899. They had no children. He was born in western New York State in 1863 and had come to North Dakota in 1892. He was first employed as a telegraph operator and then became the cashier of the First National Bank of Buffalo, ND. In 1898 he settled in Fingal and organized the Bank of Fingal, serving as its cashier. In 1904 it became the First National Bank of Fingal (charter #7295), and he contin- ued as its cashier. Laura A. Batcheller, who had been vice president of the Bank of Fingal, became vice president of the new national bank. Two years later in 1906 she was elected its president. She was active in both state and national banking organizations. In August 1903 she was the only woman at the founding convention of the North Dakota Bankers Association. In 1905 she was the only woman delegate to the American Bankers Association meeting in Washington, DC. While there, she was elected vice president of the North Dakota association. The Washington Post noted she “has the appearance of a thor- ough business woman, and is decidedly attractive in her personality.” At the North Dakota Bankers Association meeting in Fargo in July 1906, she gave a report of the ABA meeting. That year she also served as the treasurer of the NDBA. Later in 1906 she attended the annual meet- ing of the ABA in St. Louis where she was the only woman bank president at the convention. In 1913, when the ABA met in Boston, the Christian Science Monitor ran an article about her headlined “Woman President of Bank Attends Convention Here.” Although she is quoted as saying that it must have been gallantry that caused the four men directors to elect her president nearly a decade before, she went on to say that she saw “no reason why a woman should not be a bank president, if she is qualified for the position.” When asked about woman suffrage, she confessed that she was not keen about it, but that “We are going to have it.” Her spirit of public service continued. In 1918, with our nation at war, she volunteered to serve the Red Cross for one year with no salary. She traveled to the east coast and then on to France, where she was to establish informational filing systems at various Red Cross offices there and perhaps in Italy also. That autumn the serious influenza epidemic swept the United States. Mr. Batcheller was ill with it, and resulting complications caused his death at their home in Fingal on Friday, February 23, 1919. Mrs. Batcheller had been informed by telegram of his illness, and she was returning by boat from France at the time of his death. She arrived in New York City early in March, and had the body of her husband brought to New York State where he was buried in Stockton, the village of his birth. She then returned to Fingal. In June 1919, when the bank directors elected N. P. Langemo as president, the local newspaper reported that the directors of the bank and several others were the stockholders, and noted “they have taken over all the Batcheller interests in the bank.” At some point she moved from North Dakota. The 1930 census found her in Los Angeles County, California, working, appropriately enough, as a clerk in a bank. She died in Los Angeles on August 6, 1946, which was her 73rd birthday. The First National Bank of Fingal became the Fingal State Bank in 1932. In 2003 it took over the Page State Bank and changed the name of the combined bank to Quality Bank. Its two offices, some 35 miles apart, today serve the communities of Fingal and Page and the surrounding areas. Sources The Fingal Community History (1980) has a section on the bank, pages 25-26, and a biographical sketch on Charles E. Batcheller, pages 85-86. His obituary is found in The Fingal Herald, February 28, 1919. Mentions of bank conferences attended by Laura A. Batcheller are found in the Grand Forks Daily Herald, August 29, 1903, October 19, 1905, and July 17, 1906; and in The Washington Post, October 14, 1905, and the Christian Science Monitor, October 9, 1913. Her Red Cross work is noted in The Fingal Herald, June 14, 1918, and the change in the bank’s ownership in the same newspaper for June 27, 1919. v Laura A. Batcheller, National Bank President by Karl Sanford Kabelac *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 135 Paper Money • March/April 2010 • Whole No. 266136 Dear Fellow Paper Money Lovers: First of all, I write this as we embark on a new decade, and let me wish you all a Happy New Year. Please accept my wishes that all our members and their loved ones have a healthy and prosperous new year, with the means and the time to enjoy our hobby and our Society. May it be so, and may it continue for the decade to come and more. This month’s column is a bit of a pot-pourri, which I hope our reader-members will indulge and enjoy. As some know, I live in this interesting place called New York City, and the first big show of the year has just finished up in Orlando. The reports are in, and it is my pleasure to pass along that the Society had a nicely attended regional meeting, courtesy of our hosts [the Florida United Numismatists], the organizer [Judith Murphy, SPMC Regional Events Coordinator], and the speaker at the meeting [our own Pierre Fricke]. The F.U.N. show is always a great way to kick off the hobby year. While I have attended the F.U.N. show over the last few years, and enjoyed the interesting topics and crew at our meet- ings, I have been torn between that event and another show which unfortunately coincides with it – the New York International Numismatic Convention. This show, which is held in the Waldorf-Astoria, is not only a shorter commute, but, as a sometime collector of Spanish and Swedish paper money, it embraces a lot of the aspects of the hobby that are enjoyable and important to me. So, this year, with inevitable regrets and misgivings, I missed out on the F.U.N. but enjoyed the NY International. The NY show, which is packed into large meeting rooms on the 18th floor of the Waldorf, had the same eager, multi- language, multi-discipline buzz it always does. From ancient coins to books, world paper money to foreign gold, it is a remarkable assemblage of goods and devotees from every- where. And because the show’s rules maintain a focus which is decidedly away from modern U.S. material, it will likely always feel very different from the typical U.S. coin show. There are a host of official auctions held as part of the week’s activities, and there are several unofficial ones as well. All in all, more than enough activity, people, education and material to go around, for visiting collectors and dealers alike. It is unfortunate for all that the NY and Florida shows conflict. It is physically possible to attend a meaningful piece of each show, by leaving one early and arriving at the other late, and there are people who do this, but nobody I know thinks it is a perfect experience. This overlap is likely to continue for the foreseeable future, from what I can tell. For several months now, I have been looking forward to telling our members a little bit about a somewhat newer and not-so-well-known museum experience they may want to add to their itinerary the next time they are in the Big Apple. As anyone who has visited knows, New York City is a place full of entertainment on and off-Broadway, some of it intentional, much of it growing out of the various madnesses that take place here every day and make New York City the unique locale it is. There are however, several oases of sanity, and one of them would likely be of interest to any SPMC members as might be visiting. It is a museum, the Museum of American Finance, and it is quite fittingly located at 48 Wall Street, in what was, for over two centuries, the headquarters of the Bank of New York, a creation of one of the founding fathers, or per- haps the founding father of this country’s finances, Alexander Hamilton. The Museum is the brainchild of John Herzog, who is better known in our hobby for his hobbies than his real career in Wall Street. In addition to his “real job,” John’s fascination with financial history led him to involvement in R.M. Smythe when it was a securities research firm only, which he and wife Diana built into a diversified stock, bond, currency, coin, auto- graph and financial ephemera dealer and auction house. That being not enough, he went looking for more and found it, in the form of starting, in 1988, the “Museum Project.” This began with a pair of exhibitions, in the downtown Custom House [an institution also founded by Alexander Hamilton] about the history of the financial markets and New York City. This led to a further successful “experiment,” more permanent but somewhat cramped quarters on lower Broadway, first at 24 Broadway, then at 28 Broadway, but with the move to Wall and William Streets, it has found its rightful home. The museum is accessed from street level, and the exhibit space is one circular stone flight of stairs up to what was the bank headquarters banking floor, and a grand space it is. Landmarked, the tasteful transition into a museum space has been made without doing anything to impair the ability to imagine what it was like as a retail banking office in its heyday. The series of artworks which lines the upper walls of the bank- ing floor, depicting the financial history of the city, are appro- priate reminders of what the museum and the neighborhood of this city have been and are all about. The permanent exhibits can be thought of as being orga- nized into coherent groups and as would be expected include the history of the principal financial markets in the U.S. – the equities market, the bond market, the commodities markets – as well as interactive explanations of how they work today. Since 9/11 the visitors’ gallery at the NYSE has been closed to the public. However, the Museum now provides a live video feed of the floor activity at the Exchange. The Museum does a good job of spotlighting the entrepreneur as the true long term engine of a successful economy, highlights the role of capital formation in helping dreamers grow their dreams, and the role of the banking industry is explained, with some humor, I might add. A small office off to the side of the main floor, designated “The Hamilton Room,” tells the story of this remarkable man, from humble birth to his well-documented death. Included among the exhibits in the room are a few early and lovely Bank of New York color proofs. [As an aside, Hamilton rests in the yard of Trinity Church, a scant three blocks west at the head of Wall Street; the gates to the church, the surrounding yard and his gravesite are open most daytime hours.] However, for SPMC members, one highlight of any visit will likely be a glassed-in room which tells the history of money in this country. One side of the room begins with wampum and beaver pelts, and progresses through the colo- nial period. Colonial currency, its origins, its later role in The President’s Column *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 136 Paper Money • March/April 2010 • Whole No. 266 137 $$ money mart WANT ADS WORK FOR YOU We could all use a few extra bucks. Money Mart ads can help you sell duplicates, advertise wants, increase your collection, and have more fun with your hobby. Up to 20 words plus your address in SIX BIG ISSUES only $20.50/year!!!! * * Additional charges apply for longer ads; see rates on page opposite -- Send payment with ad Take it from those who have found the key to “Money Mart success” Put out your want list in “Money Mart” and see what great notes become part of your collecting future, too. (Please Print) ______________________________ ___________________________________ ___________________________________ ___________________________________ ONLY $20.50 / YEAR ! ! ! (wow) Paper Money will accept classified advertising on a basis of 15¢ per word (minimum charge of $3.75). Commercial word ads are now allowed. Word count: Name and address count as five words. All other words and abbrevia- tions, figure combinations and initials count as separate words. No checking copies. 10% discount for four or more insertions of the same copy. Authors are also offered a free three-line classified ad in recognition of their contribu- tion to the Society. These ads are denoted by (A) and are run on a space available basis. Special: Three line ad for six issues = only $20.50! HERE’S YOUR OPPORTUNITY!!! YOUR WORD AD could appear right here in each issue of Paper Money. You could advertise your duplicates inexpensively, or advertise your Want List for only $20.50 for three lines for an entire year. Don’t wait. (PM) WANTED: ALBANY, GA National Bank Notes. Any bank, type or denomina- tion. Write with description (include photocopy if possible) first. George Anderson, 1015 Summit Dr., Albany, GA 31707 (270) NJ TURNPIKE TOLL SCRIP from the 1950s-80s. Looking for any info on, and also looking to buy same. Send info or contact: PO Box 1203, Jackson, NJ 08527 or fivedollarguy@optonline.net Jamie Yakes, LM338 (A) WRITING A NUMISMATIC BOOK? I can help you with all facets of bring- ing your manuscript to publication. Proven track record for 40 years. See PM N/D 2008 p. 472 for details. Contact Fred Reed fred@spmc.org (270) WANTED: Notes from the State Bank of Indiana, Bank of the State of Indiana, and related documents, reports, and other items. Write with descrip- tion (include photocopy if possible) first. Wendell Wolka, PO Box 1211, Greenwood, IN 46142 (270) WILDCAT BANKS OF WAYNE COUNTY (Ohio), 80 pages, $30 postpaid. Raymond E. Leisy, 450 N. Bever St., Wooster, Ohio 44691 (A) financing the Revolutionary War, and the lessons learned are nicely documented. The next segment begins with early and later obsolete sheet examples, and explains the rise of the pri- vate banks, their role in the finances of the 1800s and the growth of the country up to the time of the Civil War. Federal and Confederate issues during the war are followed by the gold story and a pair of gold certificates, and the last panel covers the transition to small size currency, with a reasonably representative selection of small size type and emergency issues. The paper money on exhibit closes with the “modern innovation” of the Berkshares. The paper money display is far from comprehensive, but it tells its story well in the context of a unique museum, and the overall story being told is an important one. There are several other syngraphic items on display, stocks, bonds, war bonds as well, and I recommend the museum to our members, and to anyone with an interest in what makes this country “tick.” And, at a time when Wall Street professions are not necessarily all viewed as being conducted in perfect fashion, the over-riding importance of solid capital markets is not a bad perspective to revisit. Before I begin to sound like a New York City tour guide, I will close for this issue, but again thank our Governors for their work on behalf of the Society, and remind you, our members, that we like keeping you at the forefront. As always, wherever you are and regardless of what you collect, we will always be interested to hear what may be on your minds. vMark *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 137 Paper Money • March/April 2010 • Whole No. 266138 Mrs. R.L. Whaley, National Bank President by Karl Sanford Kabelac MARGARET GIBSON, WHO WAS TO MARRY R. L. WHALEY,was born in Portage, Wisconsin on July 15, 1865 the daughter ofJohn and Agnes Gibson. At the age of four she moved with herparents to Missouri, and grew up on a farm outside of Albany, Missouri. Albany, the county seat of Gentry County, is in the northwestern part of the state. In 1900 it had a population of 2,035, an increase of 50% in the pre- vious decade. Its population a century later is slightly less than 2,000. In 1901 she married Richard L. Whaley, a widower with three sons. He was born in Georgia in 1846, and became a resident of Albany in 1874. For the next 58 years he played an important role in the community, first as a lawyer, and then as a businessman and banker. He was the founding president of The First National Bank of Albany (charter #7205) in 1904. He continued as president of the bank for twenty-eight years, until his death on August 2, 1932 at the age of 86. Mrs. Whaley, who had been a director of the bank, then became its president. Her oldest stepson, Moiston, who had been cashier of the bank since 1909, continued in that position and was the active manager of the bank. Legal notices that appeared in The Albany Ledger, February 21, 1935, relating to the closing of the bank, signed by Mrs. R.L. Whaley, President *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 138 Paper Money • March/April 2010 • Whole No. 266 139 In February 1935, having survived the worst years of the Depression, the Board of Directors decided to close the bank. Depositors were notified that the bank would close on Friday, March 1. They were assured that the bank had enough resources to pay all depositors in full and meet all other obligations. It was explained that the bank, although entirely solvent, had not been able to make a reasonable return on its investments and the Board had reluctantly decided to liquidate it. At the end of 1934, a few months before it closed, the bank had deposits of $136,456 and a circulation of National Bank Notes of $29,800. During her presidency, Mrs. Whaley’s signature appeared on some of the Series 1929 type 1 National Bank Notes issued by the bank, and presumably all of the Series 1929 type 2 notes. There were a total of 10,116 of the former and only 268 of the latter issued. Both types were issued in fives, tens, and twenties. Mrs. Whaley continued to live in Albany, where she died on January 21, 1948, at the age of 82. Her obituary in the local newspaper made no mention of her bank presidency, but noted that she had been active in the Presbyterian Church and the Order of Eastern Star. She was survived by two stepsons, a daughter, and two granddaughters. Sources and acknowledgements The Albany Capital and The Albany Ledger both carried obituaries of R. L. Whaley on August 4, 1932, and The Albany Ledger carried an obituary of Mrs. R. L. Whaley on January 22, 1948. The closing of the bank was front-page news in both local newspapers on February 21, 1935. I am grateful to Pat Manring of the Gentry County Genealogical Society and to the granddaughters of Mrs. Whaley for their assistance. v A Series 1929 Type 1 note with Mrs. R.L. Whaley’s facsimile signature as President. Anna M. Stentz, National Bank President - Addendum Anna (Annie) M. Stentz, President of The First National Bank of Monroeville, Ohio, was the subject of my article in Paper Money, March/April 2009, p. 122. Through the miracle of Google, I recently discovered an informative bio- graphical sketch of her, her first husband Orren W. Head (1808-1882) and her second husband Henry P. Stentz (1838-1903). There are also pictures of each; hers is reproduced here. (The source is A. J. Baughman, History of Huron County, Ohio ... . Chicago, S. J. Clarke Pub. Co., 1909, v. 2, p. 44-54.) -- Karl Sanford Kabelac v *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 139 Yr. Vol. No. Pg. Allen, Harold Don. Notes from North of the Border: Look Here, Here's Some Far Out Items, illus. 09 48 261 188 Many helpers on a lifelong hunt, illus. 09 48 260 107 New Money for Changing Times in UAE, illus. 09 48 264 458 Note numbers may encode information, illus. 09 48 262 298 Searching out note lookalikes, illus. 09 48 263 378 Aspen, Nelson Page. A Suggested Classification of Bank Notes, illus. 09 48 264 466 In the Old Days: the Banks of Chester County, illus. 09 48 260 114 BANKS, BANKERS AND BANKING. Anna M. Stenz, National Bank President, Karl Sanford Kabelac 09 48 260 122 Caroline B. Drake and Nannie M. Mabry, National Bank 09 48 261 219 Presidents, Karl Sanford Kabelac, illus. Cora B. Clark, National Bank President, 09 48 260 98 Karl Sanford Kabelac, illus. Henrietta R. Temple & Jennie M. Temple, National Bank 09 48 260 123 Presidents, Karl Sanford Kabelac, illus. In the Old Days: the Banks of Chester County, 09 48 260 114 Nelson Page Aspen, illus. Laura Biggerstaff, National Bank President, 09 48 262 300 Karl Sanford Kabelac Mertie McHenry/Mertie McHenry Langdon, National Bank 09 48 262 301 President, Karl Sanford Kabelac, Mrs. J.A. Henry; National Bank President, 09 48 260 120 Karl Sanford Kabelac, illus. Mrs. H.R. Ellsworth, National Bank President, 09 48 263 392 Karl Sanford Kabelac. One Honest Banker, The Fall of the Manhattan Bank, 09 48 264 415 John D. Davenport, illus. Remembering the Central NB of Dallas, 09 48 264 462 Frank Clark, illus. BEP Historical Resource Center Staff 09 48 261 224 The Light of Liberty, illus. Bowers, Q. David. Central City, Colorado Terr. & the famous 'Black Charter' 09 48 236 321 Notes, illus. Clark, Frank. About Nationals Mostly: Add a FR1225 to your collection, illus. 09 48 263 382 Remembering the Central NB of Dallas, illus. 09 48 264 462 Vice President Notes of Fairmont, WV, illus. 09 48 261 218 COLLECTING. Colonel Edward H.R. Green, Collector Extraordinaire, 09 48 259 34 Peter Huntoon with Barbara Bedell illus. Searching out note lookalikes, Harold Don Allen, illus. 09 48 263 378 CONFEDERATE AND SOUTHERN STATES CURRENCY. Confederate Trans-Mississippi Paper Money, Pierre Fricke, illus. 09 48 262 304 COUNTERFEIT, ALTERED & SPURIOUS NOTES. "Jim the Penman" drew fakes, Gene Hessler, illus. 09 48 261 198 Davis, Greg and Bernie Wilde. Creating a Census of Obsolete Proofs, illus. 09 48 259 63 Davenport, John D. One Honest Banker, The Fall of the Manhattan Bank, illus. 09 48 264 415 ENGRAVERS & ENGRAVING AND PRINTING. Engraver's kin searches for his banknote art, 09 48 262 295 Gene Hessler, illus. The BEST currency designs? Here's my choices, 09 48 260 144 John Gavel, illus. The Light of Liberty, BEP Historical Resource 09 48 261 224 Center Staff, illus. Several Indian Chiefs on paper money, Gene Hessler, illus. 09 48 263 374 Yr. Vol. No. Pg. Ferreri, C. John and Gary W. Potter. Connecticut Merchant Scrip, 1794-1876, illus. 09 48 262 243 Fricke, Pierre. Confederate Trans-Mississippi Paper Money, illus. 09 48 262 304 Gavel, John. The BEST currency designs? Here's my choices, illus. 09 48 260 144 Gatch, Loren. The Modern Local Currency Movement in the 09 48 264 426 U.S. & Canada, illus, The Professor and a Paper Panacea: Irving Fisher, illus. 09 48 260 125 Gladfelter, David D. Issued New-Brunswick 2d of 1796 a rarity, illus. 09 48 260 106 Mount Hope, New Jersey, Scrip - By the Book, illus. 09 48 261 200 Hessler, Gene. The Buck Starts Here: Darley's The War Alarm shows up on a TV episode, illus. 09 48 264 454 Engraver's kin searches for his banknote art, illus. 09 48 262 295 "Jim the Penman" drew fakes, illus. 09 48 261 198 Numismatic treasures spark memories, illus. 09 48 259 76 Somali small notes bring back memories, illus. 09 48 260 118 Several Indian Chiefs on paper money, illus. 09 48 263 374 Hopson, Hal. John Law and the coming of paper money to France, illus. 09 48 260 152 Huntoon, Peter. The Paper Column: Origin of Large Size FRBNs, illus. 09 48 260 100 Seal Colors on Series 1934 FRNs, illus. 09 48 259 72 Series 1929 Federal Reserve Bank Notes, illus. 09 48 261 163 Huntoon, Peter with Barbara Bedell. Colonel Edward H.R. Green, Collector Extraordinaire, illus. 09 48 259 34 Huntoon, Peter and Bob Kvederas. Connecticut Challenges Definition of "Town" on 09 48 264 403 National Bank Notes, illus. Huntoon, Peter and Doug Murray. Durable Series 1880 Legal Tender $500 Plate, illus. 9 48 264 421 INTERNATIONAL. John Law and the coming of paper money to France, 09 48 260 152 Hal Hopson, illus. Look Here, Here's Some Far Out Items, 09 48 261 188 Harold Don Allen, illus. Many helpers on a lifelong hunt, Harold Don Allen, illus. 09 48 260 107 New Money for Changing Times in UAE, 09 48 264 458 Harold Don Allen, illus. Note numbers may encode information, 09 48 262 298 Harold Don Allen, illus. Somali small notes bring back memories, Gene Hessler, illus. 09 48 260 118 Kabelac, Karl Sanford. Anna M. Stenz, National Bank Presidents 09 48 260 122 Caroline B. Drake and Nannie M. Mabry, 09 48 261 219 National Bank Presidents, illus. Cora B. Clark, National Bank President, illus. 09 48 260 98 Henrietta R. Temple & Jennie M. Temple, 09 48 260 123 National Bank President, illus. Laura Biggerstaff, National Bank President 09 48 262 300 Mertie McHenry/Mertie McHenry Langdon, 09 48 262 301 National Bank President, Mrs. J.A. Henry; National Bank Presidents, illus. 09 48 260 120 Mrs. H.R. Ellsworth, National Bank President 09 48 263 392 Lofthus, Lee. Why So Few Series 1923 $10 Legal Tenders 09 48 234 442 Were Issued, illus. Paper Money • March/April 2010 • Whole No. 266140 An Index to Paper Money Volume 48 (2009) Whole Numbers 259 - 264 Compiled by George B. Tremmel *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 140 Yr. Vol. No. Pg. NEW LITERATURE. Authors announce new book on Confederate certificates, 09 48 261 193 illus. Former Paper Money Editor Gene Hessler pens 09 48 261 172 autobiography, illus. "Fresh, New Book" covers Kansas Paper Money, illus, 09 48 262 273 Gene Hessler Krause releases fifth edition of Newman's magnum opus, 09 48 260 109 illus., Fred Reed Krause releases third edition of Bart error note guide, illus. 09 48 261 191 illus., Fred Reed New Abe book "well researched and thoroughly detailed," 09 48 262 303 illus., Bob Schreiner, SPMC Authors Pen New Books on Nationals - 09 48 264 461 Matt Jatzen, Jim Millard, illus., Fred Reed Sullivan updates his work on large denomination bills, Illus, 09 48 259 62 Fred Reed Whitman releases 2nd edition of Doty's America's Money, 09 48 260 113 illus. Fred Reed OBSOLETE NOTES & SCRIP. BerkShares Experiment Now in Third Year, 09 48 260 83 Fred Reed/Photography by Jason Houston, illus. Connecticut Merchant Scrip, 1794-1876, 09 48 262 243 C. John Ferreri and Gary W. Potter, illus. Creating a Census of Obsolete Proofs, 09 48 259 63 Greg Davis and Bernie Wilde, illus. Issued New-Brunswick 2d of 1796 a rarity, 09 48 260 106 David D. Gladfelter, illus. Mount Hope, New Jersey, Scrip - By the Book, 09 48 261 200 David D. Gladfelter, illus. Nacogdoches Real Estate Deposit and Exchange Co., 09 48 261 173 Elmer C. Powell, Jr., illus. Odd and Obsolete Banknotes: South Bend Notes, 09 48 264 464 Bob Schreiner, illus. The Modern Local Currency Movement in the U.S. 09 48 264 426 & Canada, Loren Gatch illus. The Professor and a Paper Panacea: Irving Fisher, 09 48 260 125 Loren Gatch, illus. Western and Atlantic Rail Road Scrip, Dennis Schafluetzel, 09 48 261 175 illus. PAPER MONEY AND FINANCIAL HISTORY. America's First Securities Markets, Richard Sylla, 09 48 261 194 Jack W. Wilson and Robert E. Wright., illus. John Law and the coming of paper money to France, 09 48 260 152 Hal Hopson, illus. Numismatic treasures spark memories, Gene Hessler, illus. 09 48 259 76 PAPER MONEY IN MOVIES,. ART, and TV. Darley's The War Alarm shows up on a TV episode, 09 48 264 454 Gene Hessler, Illus. Mike Jenkins nails sci-fi prop note, Fred Reed, illus. 09 48 263 396 Powell, Elmer C., Jr. Nacogdoches Real Estate Deposit and Exchange Co., illus. 09 48 261 173 Reed, Fred. On This Date in Paper Money History - Jan. 2009 09 48 259 47 On This Date in Paper Money History - Feb. 2009 09 48 259 49 On This Date in Paper Money History - Mar. 2009 09 48 260 127 On This Date in Paper Money History - Apr. 2009 09 48 260 129 On This Date in Paper Money History - May 2009 09 48 261 207 On This Date in Paper Money History - Jun. 2009 09 48 261 209 On This Date in Paper Money History - Jul. 2009 09 48 262 287 On This Date in Paper Money History - Aug. 2009 09 48 262 289 On This Date in Paper Money History - Sept. 2009 09 48 263 367 On This Date in Paper Money History - Oct. 2009 09 48 263 369 On This Date in Paper Money History - Nov. 2009 09 48 264 447 On This Date in Paper Money History - Dec. 2009 09 48 264 449 Mike Jenkins nails sci-fi prop note, illus. 09 48 263 396 Sign of the Times: internet jokers release new "U.S. Dollar", illus.09 48 259 56 Yesteryear in SPMC History, illus. 09 48 264 455 Yr. Vol. No. Pg. Reed, Fred/Photography by Jason Houston. BerkShares Experiment Now in Third Year, illus. 09 48 260 83 Schafluetzel, Dennis. Western and Atlantic Rail Road Scrip, illus. 09 48 261 175 Schreiner, Bob. Odd and Obsolete Banknotes: South Bend Notes, illus. 09 48 264 464 SOCIETY OF PAPER MONEY COLLECTORS. 10th Annual George W. Wait Memorial Prize Announcement 09 48 264 477 $1/$5 in Brooklyn at year's end sport “wheresgeorge?” tags, 09 48 260 111 Fred Reed, illus. 2009 SPMC Awards Breakfast announcement 09 48 261 217 Bradford/Kessler head PCGS Currency buy out, illus. 09 48 261 223 Do You Want to Serve on the SPMC Board of Directors? 09 48 260 143 Editor's Notebook (Fred Reed): Lincoln and paper money 09 48 259 78 Privatized money issues 09 48 260 158 You too can report 09 48 261 238 Cataloging for posterity 09 48 262 318 10 Years and Counting 09 48 263 398 Who Will Advertize Here? 09 48 264 478 Five Speak at 6th Annual SPMC Author's Forum, illus. 09 48 263 394 Four selected for SPMC board posts, illus. 09 48 261 236 Gene Hessler's Autobiography Proves Popular at 09 48 263 390 Book Signings, illus. Higgins Museum to host 2009 National Bank Note Seminar 09 48 262 273 In Memoriam: Death claims pioneer small size note enthusiast 09 48 261 214 Nate Goldstein, illus., Fred Reed "I'll Miss My Good Friend, Tom Minerley." 09 48 262 302 Bob Moon, illus. Index to Paper Money, Vol. 47, 2008, Nos. 253-258, 09 48 259 58 George Tremmel Information and Officers: 09 48 259 2 09 48 260 82 09 48 261 162 09 48 262 242 09 48 263 322 09 48 264 402 Letters to the Editor: 09 48 260 112 09 48 264 414 09 48 264 433 Money Mart: 09 48 259 57 09 48 260 137 09 48 261 217 09 48 262 297 09 48 263 377 09 48 264 457 Nathan Gold Lifetime Achievement Award 09 48 263 375 Honors John & Diana Herzog New Members: 09 48 259 64 09 48 261 222 09 48 263 353 09 48 264 433 Numismatic Literary Guild & ANA honor SPMC-member 09 48 259 75 authors, illus. PNG. ANA & NLG Honor SPMC Members, illus. 09 48 264 451 President's Column (Benny Bolin): 09 48 259 57 09 48 260 137 09 48 261 216 President’s Column (Mark Anderson) 09 48 262 296 09 48 263 376 09 48 264 456 Researcher compiles narratives on female National 09 48 259 56 Bank Presidents, illus. Scene at Memphis, Photographs by Robert Van Ryzin, 09 48 263 386 Bank Note Reporter, illus. SPMC 2009 Memphis Board Meeting Minutes 09 48 263 384 Paper Money • March/April 2010 • Whole No. 266 141 *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 141 Paper Money • March/April 2010 • Whole No. 266142 Yr. Vol. No. Pg. SPMC Board bids adieu to one classy lady, Judith Murphy, illus. 09 48 262 317 SPMC's limited edition Peter Maverick souvenir card, 09 48 260 112 David D. Gladfelter, illus SPMC Memphis 2009 Awards 09 48 263 385 SPMC Thanks the Sponsors of the Tom Bain Raffle 09 48 263 377 SPMC Treasurer reports (Bob Moon): 09 48 259 61 Tennessee scrip project wins 9th Wait Award 09 48 261 237 www.wheresgeorge website has recorded 154 million bills, 09 48 263 373 Fred Reed, illus. Schuffman, Lawrence D. The Liberty and Victory Loan Bonds, 1917-1923, illus. 09 48 259 3 Sylla, Richard, Jack W. Wilson and Robert E. Wright. America's First Securities Markets, illus. 09 48 261 194 Want Ads Work for You 09 48 263 353 Yesteryear in SPMC History, Fred Reed, illus. 09 48 264 455 U.S. NATIONAL BANK NOTES. Central City, Colorado Terr. & the famous 09 48 263 321 'Black Charter' Notes, Q. David Bowers, illus. Connecticut Challenges Definition of "Town" on National 09 48 264 403 Bank Notes, Peter Huntoon and Bob Kvederas. illus. Vice President Notes of Fairmont, WV, Frank Clark, illus. 09 48 261 218 U.S. LARGE and SMALL SIZE NOTES. FEDERAL RESERVE NOTES. Origin of Large Size FRBNs, Peter Huntoon, illus. 09 48 260 100 Yr. Vol. No. Pg. Seal Colors on Series 1934 FRNs, Peter Huntoon, illus. 09 48 259 72 Series 1929 Federal Reserve Bank Notes, 09 48 261 163 Peter Huntoon, illus. SILVER AND GOLD CERTIFICATES. Add a FR1225 to your collection, Frank Clark, illus. 09 48 263 382 Rare $5 Silver Certificate Series of 1934B M-A Block 09 48 264 473 Notes, Jamie Yakes, illus. TREASURY NOTES. Durable Series 1880 Legal Tender $500 Plate, 09 48 264 421 Peter Huntoon and Doug Murray illus. Why So Few Series 1923 $10 Legal Tenders Were 09 48 264 442 Issued, Lee Lofthus, illus. Whitfield, Steve. It Occurs to Me: Virtual Paper Money Club 09 48 259 78 Will last type notes surface? 09 48 260 158 I May be Wrong, But... 09 48 261 238 Nice people in the hobby 09 48 262 318 Today’s Ruminations 09 48 263 398 “Integrity” 09 48 264 478 Yakes, Jamie. Rare $5 Silver Certificate Series of 1934B M-A Block 09 48 264 473 Notes, illus. v WE WERE VERY PLEASED TO SEE THATWhitman Publishing, LLC has published a very nice check list and record book for United States paper money from 1861 to present. This soft bound book contains 248 pages and allows you to catalog your U. S. paper money collection utilizing the Friedberg and Whitman num- bering systems. Each entry has a place for a check mark, as well as a space to list the grade and make other com- ments. This extra space for com- ments will be a great place to put important information regarding the notes in one’s collection. You can list in the comment space: price paid, dealer name or auction pur- chase, serial number, date pur- chased, or other information such as a graded note. This check list and record book covers all federal issues from $1 to $10,000, fractional currency (including regular issues, specimen issues and shields), postage currency, encased postage stamps, mule notes (with many star numbers listed) and one page to list your errors. One page is also available for you to list your miscellaneous items such as War of 1812 issues, or other U. S. paper that might not be listed in this book. We especially liked seeing the printages of the notes along with rarity and extant of issues known. To say the least this is invaluable information, and can actually be used when you are looking at auction catalogs, dealer stocks at their stores, coin shows or Internet. Over the past 15 years we have seen many more dealers and collectors come into the marketplace for U. S. paper money. This ref- erence has all the information one needs regarding all issues and will assist with buying and selling of them. This will be another best seller for Whitman and is available from them for $9.95. For information on purchasing this check list and record book they may be con- tacted at: Whitman Publishing, LLC, 3101 Clairmont Road, Suite C, Atlanta, GA 30329 Phone No. (800) 546 – 2995 or visit their web page at www.whitmanbooks.com. v Whitman releases “official Red Book” check list and record book Reviewed by John and Nancy Wilson *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 142 Paper Money • March/April 2010 • Whole No. 266 143 *Mar/Apr 2010 Paper Money 8/9/11 8:43 AM Page 143 Paper Money • March/April 2010 • Whole No. 266144 THIS REVIEWER HAS BEEN ANTICIPATING JIMBevill’s new history of Republic of Texas paper money for two years. Friend and well known Dallas paper money dealer John Rowe has been beating the drum for this book at least that long. According to Rowe the new book would be tremendous! Well, Jim Bevill’s The Paper Republic: The struggle for Money, Credit and Independence in the Republic of Texas has final- ly arrived . . . and I can state unequivocally it was worth the wait. Bevill, a financial advisor and paper money collector, has delivered on the promise. This book is simply splendid! Cataloging of Texas paper money is not new. Grover Criswell, Hugh Shull and others have described the republic and state series in detail. Just a couple years ago Joseph D. Olson delivered an excellent catalog of the various note issues, which I highly recommended in these pages. Hank Bieciuk and Bob Medlar have written about Texas scrip and obsoletes, and the Steve Ivy collection sale in September 2002 by Heritage Auctions is another ready resource. But nobody has tackled Texas issues with the gusto Bevill exhibits in this new 352-page, oversize, full color volume, published by Bright Sky Press, Houston, TX. The first thing that impresses about this book after its heft, are the book’s design and the myriad color illustrations it displays. “Heavily illustrated” would fail to convey just how well-illustrated by notes, documents, and historical images this hisorical narrative really is. Collectors have grown to expect color images, since the auction firms gravitated to that kind of presentation in the mid-1970s. Catalogs, too, were dragged into the color revolution in the 1990s, and recent books, espe- cially those by SPMC author Q. David Bowers, published by Whitman Publishing (Dave’s Obsolete Paper Money of the United States comes readily to mind) have set high standards of pro- ducion values. This book exceeds all those watermarks. It is unfair, perhaps, to compare works, but collectors esteeming the aforementioned Bowers’ work, would find themselves well-served and on familiar ground by Bevill’s treatment of Texas history through its currency. This book is well-researched and extensively footnoted. Sources consulted range from archives, to contemporary publications, to sec- ondary sources. The historical narrative of the making of the Texas nation is skillfully told, and the “story value” of the pre- sentation makes enjoying Bevill’s commentary second nature. Particularly interesting to this reviewer is the author’s melding of a scholar’s tenacity with a collector’s sensitivity in describing the context and results of the various paper emis- sions comprising Texas’ tumultous history. Hard bound copies are priced at $60 from the publisher, Bright Sky Press, 2365 Rice Blvd., Suite 202, Houston, TX 77055 or on line at www.birghtskypress.com. -- Fred Reed v PAPER MONEY COLLECTORS ARE ALWAYSlooking for something else to collect. Increasingly, for the past two decades, growing numbers have been turning to the colorful emissions of the “Happiest Kingdom in the World,” the circulating scrip of Walt Disney’s theme parks, Disney dollars. With Disney stores spanning the miles between these major tourist attractions, Disney dollars are sprouting up in the backyards of most readers of this publication. Collectors of these colorful notes now have a reliable and thorough treat- ment of this paper money niche, Charles Rodger’s History of Disney Dollars, 1987-2009, recently published by the author and proprietor of C.T. Coins, Lakewood, CA. Disney dollars trace their history to a special emission of $1 and $5 notes on May 5, 1987, when Matt Mew, a Disney illustrator, designed the first notes for use at the Anaheim park. Notes were introduced to the Orlando parks that October. Successive series of notes have continued to be issued down to the present day. In his business, dealer Rodgers found the Disney issues popular with collectors. However, he always had to answer their questions, “Is there a book on Disney dollars?” in the negative. So in 2002, he decided he would produce the book which debuted recently to a receptive audience. Collecting the dollars is fun. Mickey, Minnie, Donald and the rest of the famous characters romp across the notes. Rodgers’ spiral bound, color history is a fun read, too. The catalog includes prices in two grades, illustrations of all notes and ancillary items as well as a complete checklist. The 54- page, cardweight catalog retails for $20 plus postage at PO Bos 4572, Lakewood CA 90711 -- Fred Reed v New book details notes of Republic of Texas C.T. Rodgers reviews history of disney Dollars *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 144 145Paper Money • March/April 2010 • Whole No. 266 *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 145 Paper Money • March/April 2010 • Whole No. 266146 Confederate States of America Montgomery Note Vignettes Depicted on Obsolete Bank Notes by Joseph J. Gaines Jr., M.D. America by National Bank Note Company *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 146 Paper Money • March/April 2010 • Whole No. 266 147 IN 1861, THE CONFEDERATE STATES OF AMERICA INTRODUCEDthe famous Montgomery notes. These notes were authorized by an act ofthe Confederate Congress dated March 9, 1861. Through intermediaryGazaway B. Lamar, an officer of the Bank of the Republic in New York City and a native of Savannah Georgia, contacts were made with the National Bank Note Company to produce $1,000,000 of 3.65% interest bearing notes. An initial printing of 607 sheets each bearing a single $50, $100, $500, and $1,000 note was made. A later run of 997 half sheets of $50 and $100 notes was also produced. In addition to the high quality desired, speed of production and secrecy were essential as production of Confederate States of America currency in the heart of the largest city in the United States of America was tricky business. However, business was business and production of the notes began. The National Bank Note Company had at its disposal an archive of stock vignettes and other design elements from which to choose. This certainly sped up production of the notes, as custom vignettes would have significantly slowed production. The Confederate States of America notes used vignettes that had previously been used on numerous obsolete bank notes from the 1850s and early 1860s. The notes were expertly produced with beautiful vignettes by the most sophisticated methods of the time. The results were simply bank note art at the highest level. The Criswell Type 1 note was the only $1,000 note authorized by the Confederate States of America. The note was adorned with portrait vignettes of native Southerners John C. Calhoun and Andrew Jackson. John C. Calhoun was a prominent South Carolina senator and former Vice President of the United States under two administrations. He also had served as a United States Congressman and was Secretary of War, and Secretary of State. Andrew Jackson was the seventh President of the United States and a former United States sena- tor from Tennessee. He was also the hero of the Battle of New Orleans in the War of 1812. The John C. Calhoun vignette appears to be the reverse image of the famous portrait of Calhoun painted by Henry F. Darby that is in the United States capitol in Washington D.C. John W. Dodge painted the original design of Andrew Jackson. Both of these vignettes were used repeatedly on numerous southern and northern obsolete notes from the 1850s. The Calhoun vignette was used almost exclusively by southern banks with only a few northern banks using this vignette. A reversed variation of this vignette also exists. As one would expect, Calhoun’s native state of South Carolina has a heavy concentration of these notes. The Jackson vignette appears on many more notes than the Calhoun vignette, and surprisingly the majority of the notes are from northern states. The other elements of the Criswell T1 note are engraved in a highly detailed manner to prevent counterfeiting. Confederate States of America, Criswell T-1, depicts John C. Calhoun (left), and Andrew Jackson (right). Both Calhoun and Jackson also appear on many obsolete notes. *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 147 Paper Money • March/April 2010 • Whole No. 266148 The Criswell Type 2 note was similarly a beautifully produced note. The note is one of two $500 notes produced for the Confederate States of America. The central vignette was engraved by James Smillie and is titled The Crossing. This very detailed and large vignette shows a train crossing an arched bridge with a centrally placed key stone. On the right side, cattle are driven down a hill to water in a stream. A small sign on the right side warns, “Look out for bell rings.” The train vignette is relatively uncommon and was used almost exclusively on obsolete notes from northern banks with rare exceptions. The only southern notes with this vignette are two post -Civil War notes: a $5 Brownsport Furnace Store note from Tennessee from the 1870s, and a $2 circu- lating Little Rock Arkansas City bond dated 1869. The remaining notes are from Northern banks with approximately twenty to twenty five notes known with this vignette. On the left side of the Criswell T2 note is Ceres, the goddess of Agriculture holding a sickle and surrounded by a plow and agricultural products. The Ceres vignette is uncommon on obsolete notes with approximately ten notes known. All of the obsolete notes with the Ceres vignette are from north- ern banks issued in the 1860s. Again, the other detail elements of the note were expertly engraved to prevent counterfeiting. The Criswell Type 3 note is a very detailed and balanced note. On the left side of the note is a vignette titled America. A salesmen’s album from the National Bank Note Company was found in London, England, and contained an example of the titled die proof. America is holding a wreath in her right hand above a shield with stars and stripes. She wears a star-laden liberty cap and cape. An upturned left hand lies above a background rising sun. This vignette was Confederate States of America, Criswell T-2, depicts Ceres (left), and The Crossing (center). Each vignette also appears on various bank notes. Confederate States of America, Criswell T-3, depicts America (left), and a train at a station (center). Once again several obsolete notes with the same vignettes are known. *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 148 Paper Money • March/April 2010 • Whole No. 266 149 *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 149 Paper Money • March/April 2010 • Whole No. 266150 Confederate States of America, Criswell T-4, depict Negroes Hoeing Cotton, according to most catalogs. The original title for the vignette was Cotton Field. Apparently only a single obsolete note shows this vignette, according to the author’s research. used on approximately 15-20 obsolete notes with most of the notes originating from northern banks. This vignette was also used on numerous bank checks. The central vignette of the Type 3 note is a very detailed vignette depicting a train at a railroad station. This vignette portrays a bustling train plat- form with workers moving barrels of goods on the left side of the train. Two milk jugs are at the edge of the platform near the train. On the right side of the platform porters transport luggage, and women in long dresses hold parasols. A carriage with horses is nearby and is so detailed that the driver’s whip is visible. This vignette was used on about a dozen obsolete bank notes from the 1860s with most of the bank notes originating from northern states. Southern bank notes with this vignette include a $5 note of the Central Railroad and Banking Company from Savannah, Georgia, and a $5 note of the Commercial Bank of Tennessee from Memphis, Tennessee. The other background elements of the Type 3 note are executed in a highly detailed manner. The Criswell Type 4 Montgomery note is the only Montgomery note with one vignette. The central vignette is titled Cotton Field. An example of the titled die proof was found in a National Bank Note Company salesmen’s album discovered in London, England, whose contents were sold at auction by R.M. Smythe at the 2005 Memphis International Paper Money Show. This vignette is *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 150 Paper Money • March/April 2010 • Whole No. 266 151 *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 151 Paper Money • March/April 2010 • Whole No. 266152 one of three Montgomery note vignettes that were later recycled and used again on the Criswell Type 41 Confederate States of America note produced by Keatinge and Ball in 1862. It is interesting that the only recycled Montgomery vignettes were all used on the same issue. The Cotton Field vignette depicts a common scene in Southern life, slaves working in a cotton field. The vignette features three slaves toiling in a cotton field with two of the slaves hoeing rows of cotton and one holding a basket brim- ming with hay. In the background is the master’s house. In contrast to the other vignettes used on Montgomery notes, the Cotton Field vignette was apparently only used on one obsolete note. A Bank of Savannah, Georgia $5 note appears to be the only obsolete note that uses this vignette. The other design elements of the note are executed in superb detail. Examples of obsolete notes bearing the same vignettes as the Confederate States of America Montgomery notes are shown on the following pages.. Also pro- vided is a listing of the obsolete notes known to the author that have the same vignettes seen on the CSA Montgomery notes. Notes are regularly added so this list is certainly not claimed to be complete. If you are aware of additional obsolete notes with these vignettes, please contact the author by email at joegcsa@aol.com. America vignettes. Above: Bank of America $5, Providence, RI, Haxby RI 235-G14a. Right: Western Bank of Philadelphia $5, PA, Haxby PA 510-G10a. Below, State of Arkansas, $10 bearer note. *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 152 Paper Money • March/April 2010 • Whole No. 266 153 John C. Calhoun vignettes. Right: The Exchange Bank $5, Springfield, VT, Haxby VT 235-G8. Below: Bank of East Tennessee $10, Knoxville, TN, Haxby TN 55-G46. Ceres vignettes. Right: Corn Exchange Bank $2, DeSoto, NE, Haxby NE 20- G4b. Below: Bay State Mining Company $5, Eagle River, MI, Lee CMGC-3-14. *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 153 Paper Money • March/April 2010 • Whole No. 266154 The Crossing vignettes. Above: Exchange Bank of Attica $5, IN, Haxby IN 25-G4a. Right: Salem Bank $100, Salem, MA, Haxby MA 1130-G204a. Andrew Jackson vignettes. Above: Tiverton Bank $5, Tiverton, RI, Haxby RI 505-G8. Right: Shelbyville Bank of Tennessee $20, Shelbyville, TN, Haxby TN 220-G10a. *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 154 Paper Money • March/April 2010 • Whole No. 266 155 Type Vignette Value State Reference Bank T1 Calhoun $5 FL FL15-G2a/G2b Bank of Commerce Fernadina 1861 T1 Calhoun $25 SC Sheheen 312 Planters Bank of Fairfield Winnsboro 1850s T1 Calhoun $2 SC Sheheen 553 Bank of the State of South Carolina Charleston 1850s T1 Calhoun $5 SC Sheheen 163 Farmers and Exchange Bank Charleston 1850s T1 Calhoun $50 SC Sheheen 303 Peoples Bank of South Carolina Charleston 1850s T1 Calhoun $10 SC Sheheen 157 The Exchange Bank of Columbia Columbia 1850s T1 Calhoun $10 SC Sheheen 117 Bank of Chester Chester 1850s T1 Calhoun $10 SC Sheheen 118 Bank of Chester Chester 1850s T1 Calhoun $10 SC Sheheen 119 Bank of Chester Chester 1850s T1 Calhoun $10 TN TN55-G46 Bank of East Tennessee Knoxville 1855 T1 Calhoun $5 VT VT235-G8 The Exchange Bank of Springfield 1850s T1 Calhoun $20 SC Sheheen 293 Bank of Newberry Newberry 1850s T1 Calhoun $100 NY NY1945-G16 Bank of the Union in the City of New York NY 1850s T1 Calhoun $3 IN IN190-G4 Elkhart County Bank Goshen 1850s Cotton Field vignette. Right: Bank of Savannah $2, GA, Haxby GA 325- G8a. Train at station vignettes. Above:: Commercial Bank of Tennessee $5, Memphis, TN, Haxby TN 95-G8a. Right: Treasury Bank $2, Griggsville, IL, Haxby IL 360-G2a. *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 155 Paper Money • March/April 2010 • Whole No. 266156 T1 Calhoun $5 AL Rosene 134-4 Northern Bank of Alabama Huntsville 1850s T1 Calhoun $10 SC Sheheen 156 The Exchange Bank of Columbia Columbia 1850s T1 Jackson $5 TN TN15-Design 5A Multiple Branches Bank of America Branches 1850s T1 Jackson $1 TN TN55-G8a,G60a,G82a Bank of East Tennessee Knoxville 1850s T1 Jackson $1 VT VT125-G2a Bank of Lyndon Lyndon 1850s T1 Jackson $2 VT VT 125-G6a Bank of Lyndon Lyndon 1850s T1 Jackson $5 VT VT125-G10a Bank of Lyndon Lyndon 1850s T1 Jackson $2 PA PA515-4a Bank of Phoenixville Phoenixville 1861 T1 Jackson $10 MN MN112-G8 Bank of Rochester Rochester 1859 T1 Jackson $10 TN TN195-Design 10Ca Multiple Bank of Tennessee Branches 1850s Branches T1 Jackson $5 TN TN205-G4/G4a Bank of the Union Nashville 1856 T1 Jackson $8 NC NC100-G9, G10a Bank of Wilmington Wilmington 1850s T1 Jackson $5 TN TN90-G2/G2a Bucks Bank McMinnville 1850s T1 Jackson $2 NY NY520-UNL Canajoharie Bank Canajoharie 1850s T1 Jackson $3 AL AL65-10/G10a Central Bank of Alabama Montgomery 1850s T1 Jackson $50 PA PA175-G14a Central Bank of Pennsylvania Hollidaysburg 1850s T1 Jackson $10 MD MD230-G8, G10 Farmers and Merchants Bank Greensboro 1860s T1 Jackson $1 MI MI40-G1 Government Stock Bank Ann Arbour 1851 T1 Jackson $1 MI MI40-G2 Government Stock Bank Ann Arbour 1851 T1 Jackson 1 1/4 MI MI40-G4a Government Stock Bank Ann Arbour 1851 T1 Jackson 1 1/2 MI MI40-G5a Government Stock Bank Ann Arbour 1851 T1 Jackson $3 CT CT435-G6 Granite Bank Voluntown 1850s T1 Jackson $3 IL IL470-G2a Hermitage Bank Marion 1860 T1 Jackson $5 IL IL470-G4a Hermitage Bank Marion 1860 T1 Jackson $5 DC DC260-G8 Intenational Bank Washington 1850s T1 Jackson $100 VT VT100-G16 Lamoille Co Bank Hyde Park 1850s T1 Jackson $2 TN Garland 967 Life and General Insurance Co Nashville 1854 T1 Jackson $5 GA GA200-G22a/G22b Manufacturers Bank Macon 1862 T1 Jackson $2 PA PA455-G40a Mechanics Bank Philadelphia 1860s T1 Jackson $2 NJ NJ290-G4 Merchants Bank @ Mays Landing May's Landing 1850s T1 Jackson $2 CT CT350-A20 Merchants Bank Norwich 1850s T1 Jackson $3 DC DC300-G16 National Bank Washington 1850s T1 Jackson $2 CT CT260-A5 New Britain Bank New Britain 1860s T1 Jackson $50 ME ME390-G14 New Castle Bank New Castle 1850s T1 Jackson $50 TN TN185-G38 Planters Bank of Tennessee Nashville 1850s T1 Jackson $20 TN TN220-G10/G10a Shelbyville Bank of Tennessee Shelbyville 1850s T1 Jackson $2 GA GA80-G6/G6a Southern Bank Bainbridge 1850s T1 Jackson $3 TN TN125-G6 Southern Bank of Tennessee 1850s T1 Jackson $5 TN TN125-G8 Southern Bank of Tennessee 1850s T1 Jackson $5 IN IN260-G8 State Stock Bank Jamestown 1850s T1 Jackson $5 TN TN85-G26b The Bank of Middle Tennessee Lebanon 1850s T1 Jackson $2 IL IL235-G2a The Columbian Bank Elizabethtown 1850s T1 Jackson $2 NJ NJ390-A20 The Sussex Bank Newtown 1850s T1 Jackson $5 RI RI505-G8 Tiverton Bank Tivertown 1850s T1 Jackson $1 IN IN545-G2 Western Bank Plymouth 1850s T2 The Crossing $10 PA Schingoethe PA400-10(UNL) Allen's College Bank Mansfield 1850s T2 The Crossing $2 MI MI350-G30a/G30b Bank of Pontiac Pontiac Sept 1 1863 T2 The Crossing $2 NJ Wait-UNL Hay & Company Winslow 1865 T2 The Crossing 50c NY Harris 7 Beach and Dodge Oswegatchie Tannery Harrisville 7/15/1862 T2 The Crossing $5 NY Schingoethe NY1820-5a/5b Eastman College Bank Poughkeepsie 1850s T2 The Crossing $10 NY Schingoethe NY1820-10(UNL) Eastman College Bank Poughkeepsie 1850s *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 156 Paper Money • March/April 2010 • Whole No. 266 157 T2 The Crossing $20 OH Wolka 1225-09 Greenville Business College Greenville 1880s T2 The Crossing $2 WI Krause WI714-SC8 Knapp, Stout & Co. Company Rice Lake T2 The Crossing $2 AK AK-UNL Little Rock City Bond Little Rock 1867 T2 The Crossing $5 IL IL450-G6a Marshall County Bank Lacon 1850s T2 The Crossing $5 VA VA240-G40 Merchants and Mechanics Bank of Wheeling @ Clarksburg 1860s T2 The Crossing $5 CT CT260-G8 New Britain Bank New Britain 1860s T2 The Crossing $1 PA PA670-G2a/G2b North Western Bank Warren 1860s T2 The Crossing $100 MA MA1130-G204a Salem Bank Salem 1860s T2 The Crossing $1 OH Wolka 2304-05 Sunday Creek Store Co Rendville 1880's T2 The Crossing $5 IN IN25-G4a The Exchange Bank of Attica Attica 1860s T2 The Crossing $3 PA Schingoethe PA300-3 (UNL) Wyoming College Bank Kingston 1850s T2 The Crossing $5 TN TN-UNL Brownsport Furnace Store 1870s T2 The Crossing $2 OH Wolka 1377-11 Star Furnace Company Jackson 1860s T2 Ceres $5 MI Lee CMGC-3-11 through 15 Bay State Mining Company Eagle River 1860s T2 Ceres $1 NY NY620-G2b/G2c Columbia Bank Chatham Four Corners 1860s T2 Ceres $2 NE NE20-G4a/G4b Corn Exchange Bank De Soto 1860 T2 Ceres $3 IL IL515-G6a/G5b Douglas Bank Metropolis 1860 T2 Ceres $20 WI WI420-G16a The Green Bay Bank @ LaCrosse 1862 T2 Ceres $2 CT CT165-G124a Hartford Bank Hartford 1860s T2 Ceres $5 NY NY65-G6a Hope Bank of Albany Albany 1860s T2 Ceres $2 NY NY2570-G4a Joshua Pratt and Co. Bank Sherburne 1860s T2 Ceres $1 NJ NJ400-G2a Mercantile Bank Orange 1860s T2 Ceres $1 RI RI355-G8a Merchants Bank in Providence Providence 1860s T3 America $5 MI Lee IGMC22-3 Pittsburgh & Lake Angeline Iron Company Marquette June 5 1871 T3 America $2 MI MI-UNL Saginaw Mining Company Ishpaming June 6 1871 T3 America $10 AK Rothert 395-4 State of Arkansas Little Rock 187__ T3 America $10 AK Rothert 395-5 State of Arkansas Little Rock 187__ T3 America $5 NY Schingoethe NY450-5.p Adelphi Academy Commercial Bank Brooklyn 1860s T3 America $5 NY NY620-G8a Columbia Bank Chatham Four Corners 1861 T3 America 5c PA Hoober 333-89 G.W. Goodrich Reading 1863 T3 America $5 NY NY2315-G6 R.L. Ingersoll Company's Bank Pulaski 1860s T3 America $10 WI WI100-G4a Union Bank Columbus 1862 T3 America 20c MI Lee STJ-4-3 B.C. Hoyt, Banker St. Joseph 1862 T3 America $5 RI RI235-G14a Bank of America Providence 1860s T3 America $20 NJ NJ425-G10a National Bank Patterson 1860s T3 America $5 MA MASS760-G10a Prescott Bank Lowell 1860s T3 America $5 PA PA510-G10a Western Bank of Philadelphia Philadelphia 1860s T3 America $5 PA PA715-G14a Wyoming Bank @ Wilkes-Barre 1860s T3 America $2 MO MO20-G42a,G56a,G68a,G88a Mechanics Bank St. Louis 1861 T3 Train $5 GA GA270-G42a Central Railroad and Banking Company Savannah 1860 T3 Train $3 MD MD10-G6a American Bank Baltimore 1860s T3 Train $1 GA GA-UNL City Council of Macon Macon 1871 T3 Train $2 GA GA-UNL City Council of Macon Macon 1871 T3 Train $5 TN TN95-G8a/G26a Commercial Bank of Tennessee Memphis 1860 T3 Train $5 AK Rothert 277-2 County of Phillips Helena 1870s T3 Train 50c IN Wolka 557-1 Neely & Lyman The Boston Shoe Store Muncie 1860s T3 Train $5 IL IL495-G8a Producers Bank McLeansboro 1860 T3 Train $10 IL IL730-G10 Salem Bank Salem 1860 T3 Train $2 IL IL360-G2a Treasury Bank Griggsville 1860 T3 Train $1 MA MA1220-G24a Taunton Bank Taunton 1860s T4 Cotton Field $2 GA GA325-G8a Bank of Savannah Savannah 1860s v *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 157 Paper Money • March/April 2010 • Whole No. 266158 The Editor’s Notebook Fred L. Reed III fred@spmc.org Signatures on Notes & Scrip ALOT OF ATTENTION IS NOW GIVEN TO THE QUALITYof signatures found on many of the notes and scrip issues that paper money collectors pursue. Most of the earliest issues of paper currency required a hand-signed autograph of one or more issuing official. Colonials, obsolete notes and many of the early federal issues had a place for the cashier, president or governor to sign a note or scrip to make it valid. Depending on the writing skills of the signer, his or her name could add or detract from the piece’s desirability, as well as the value. Colonial notes are more desirable if the signer had also been a signer of the Declaration of Independence, or other important colo- nial period documents. Signers of other notes were famous personali- ties and therefore these notes also have added autograph value. For example J.P. Morgan’s signature graces the notes of a New York City bank and Bill Donlon had a national note signed by “Pawnee Bill” of a wild west show from Oklahoma. Obsolete notes have many famous signers from history, including the mili- tary and politics. Another value factor is the quality of the signature itself. Good, legible signatures in bold inks contribute to the eye appeal and value of the note. I have seen signatures in black, brown, blue, red, green and violet ink. If the signer was “penmanship challenged,” it may be impossible to decipher his script. If so, collectors have a wealth of sources to determine a name. City and bank directories usually contain ads listing bank officials and when they served. Service dates are important for detecting frauds and forgeries. If a note issued in 1928 shows John Smith as Cashier, and John Smith died in 1915, chances are pretty good that “Smitty” didn’t sign it. U.S. Nationals have mostly genuine signatures, except for coun- terfeits and stolen unsigned notes. Obsoletes may be forgeries as banks during that period went bust all the time often leaving large quantities of unsigned remainders behind. Crooks added signatures to pass the notes. And some notes have had signatures added to increase collector value. Ball point and felt tipped pens are obvious giveaways. Early scrip issue signatures are most likely authentic because of their small face value when they were issued. Signing large quantities of banknotes was an onerous task so officials often got others to sign for them. Often the word “for” was added below the actual signers name. Late issues had the “for” engraved into the plate. Another labor saving device was the rubber stamp. I have seen rubber stamped signatures as far back as the 1850s. Many late issue Blue Seal nationals have rubber stamped signatures in violet ink. Unfortunately a common practice in the past was to wash banknotes so these are often faded or nearly completely gone. Some officials, enamored of their own self importance signed with “vanity” signatures. These are usually ornate and cover a very large area, occasionally the entire face of the note. They are very desirable collector items. Eventually required signatures were simply engraved into the plates and hand signing of notes ceased altogether. PCDA honors AbeBook IGOT A VERY PLEASANT SURPRISE GIFT OVER THEholiday season that I’d like to share with some of you who helped me receive it. I received a pleasant letter from long- time friend dealer James A. Simek on behalf of the Professional Currency Dealers Association along with the nice plaque shown at right. “On behalf of the PCDA Board and all the members of the organi- zation, it is my distinct pleasure to congratulate you as this year’s winner of The PCDA Literary Award. . . . Your book entitled Abraham Lincoln, the Image of His Greatness was simply a fantastic work and well-deserving of this high honor. . . . The PCDA Literary Award is not conferred every year as there have been occasions when a work did not meet the standards set forth, so it is hoped that this award carries some level of meaning and importance to you,” the PCDA Secretary wrote. Jim also expressed his personal congratulations, and I would like to thank him, the members of the PCDA and the organization’s board for this fine honor. Many PCDA mem- bers are recognized in the acknowledgments in the front of my book. You know who you are, so suffice it to say here that without the excellent collaboration and assistance of our fine paper money dealer community, my collecting life would have been much, much poorer over the past 55 years, and the AbeBook would have been an impossible dream. Our hobby enjoys the service of a wonderful cadre of professional curren- cy dealers. A PCDA logo alerts me to knowledgable profes- sional experience and service. So thank you one and all. Here’s your chance to make a mark For the last decade-plus, SPMC member George Tremmel has been compiling detailed indices to our annual volumes of Paper Money. In 1999 George released a compre- hensive index from the beginning of PM to that date. Annual updates have appeared since. George has expressed an interest to step down from that post and desires a protegé to take up the challenging task. Here’s your chance; step up and leave your mark by emailing your availability to fred@spmc.org. v It occurs to me... Steve Whitfield *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 158 Paper Money • March/April 2010 • Whole No. 266 159 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: Jpolis7935@aol.com Member: SPMC, FCCB, ANA Are you planning a show? Want to have a paper money meeting? Would you like to have free copies of Paper Money magazine to distribute to attendees? Contact Judith Murphy P.O. Box 24056, Winston-Salem, NC 27114 oldpaper@yadtel.net DBR Currency www.DBRCurrency.com P.O. Box 28339 San Diego, CA 92198 Phone: 858-679-3350 Fax: 858-679-75-5 •Large size type notes Especially FRNs and FRBNs •Large star Notes •1928 $500s and $1000s • National Bank Notes •Easy to sort database By date added to Web site By Friedberg number All or part of any serial # •Insightful market commentary •Enlarge and magnify images You are invited to visit our web page www.kyzivatcurrency.com For the past 8 years we have offered a good selection of conservatively graded, reasonably priced currency for the collector All notes are imaged for your review National Bank NoteS LARGE SIZE TYPE NOTES SMALL SIZE TYPE NOTES SMALL SIZE STAR NOTES OBSOLETES CONFEDERATES ERROR NOTES TIM KYZIVAT (708) 784-0974 P.O. Box 451 Western Sprints, IL 60558 E-mail tkyzivat@kyzivatcurrency.com *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 159 Paper Money • March/April 2010 • Whole No. 266160 *Mar/Apr 2010 Paper Money 8/9/11 8:44 AM Page 160 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 a FREE copy of the PCDA Membership Directory listing names, addresses and specialties of all members, send your request to: The Professional Currency Dealers Association PCDA • Hosts the annual National and World Paper Money Convention each fall in St. Louis, Missouri. Please visit our Web Site pcdaonline.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 Memphis Paper Money Convention, as well as Paper Money classes 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 in the Membership Directory or on our Web Site. • Is a proud supporter of the Society of Paper Money Collectors. Or Visit Our Web Site At: www.pcdaonline.com Terry Coyle – Secretary P.O. Box 246 • Lima, PA 19037 (610) 627-1212 Mar/Apr cover 8/10/11 5:44 AM Page 3 Receive a free copy of a catalog from any Heritage category. Register online at HA.com/SPMC18563 or call 866-835-3243 and mention reference SPMC18563. "OOVBM
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QSFNJVN www.HA.com Steve IvyJim Halperin Greg Rohan Leo Frese Warren Tucker Todd Imhof Call our Currency Consignor Hotline today at 800-872-6467 ext. 1001 to discuss the optimal venue for your currency. We look forward to serving you. S IGN AT UR E ® AUC T I O N HERITAGE HAS SOMETHING FOR EVERYONE Whether you are looking to add items to your collection in 2010 or perhaps sell part or all of your collection, Heritage is here to assist you. In addition to our weekly Internet Currency Auctions, we will also be conducting the following Signature® Auctions in 2010: 2010 January FUN Signature Auction 0SMBOEP
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 2010 August Signature ANA Currency Auction #PTUPO
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