Paper Money - Vol. XLIV, No. 5 - Whole No. 239 - September - October 2005

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L OF THE SOCIETY• fiEY COLLECTORS and the first U.S. currency Tr. NImrh V3. 1815. 17///.. e/ • WWW.SPMC.9RG „sato,. CS MYTH E) ESTABLISHED 1880 Our Outstanding Team of Experts Can Help You Get the Most for Your Collection 1A -c4==g) 'TEARY You've spent years putting together an outstanding collection, and now you are ready to sell. Will the people who handle the disposition of your collection know as much about it as you do? They will at Smythe! Autographs; Manuscripts; Photographs; International Stocks and Bonds. D IANA HERZ OG President, R.M. Smythe & Co., Inc. BA, University of London; MA, New York University — Institute of Fine Arts. Former Secretary, Bond and Share Society; Past President, Manuscript Society; Editorial Board, Financial History. Board Member: PADA. U.S. Federal eT National Currency; U.S. Fractional Currency; Small Size U.S. Currency; U.S. MPC. MARTIN GENGERKE Author of U.S. Paper Money Records and American Numismatic Auctions as well as numerous articles in Paper Money Magazine, the Essay Proof Journal, Bank Note Reporter and Financial History. Winner of the only award bestowed by the Numismatic Literary Guild for excellence in cataloging, and the 1999 President's Medal from the American Numismatic Association. Member: ANA, SPMC. Small Size U.S. Currency; Canadian Banknote Issues; U.S. Coins. SCOTT LINDQUIST BA, Minot State University, Business Administration/Management. Contributor to the Standard Guide to Small Size U.S. Paper Money U.S. Paper Money Records. Professional Numismatist and sole proprietor of The Coin Cellar for 16 years. Life Member: ANA, CSNS. Member: PCDA, FCCB, SPMC. U.S. and World Coins. ANDY LUSTIG has been dealing in U.S. and World coins since 1975, and has attended more than 2,000 coin shows and auctions. His specialties include U.S. patterns,ii I The en eseorcgi Society ylo d, of and srarities ronf all series. H ae mi s aj oco-found r c ntr contributor to the 8th Edition of the Judd book, a former PCGS grader, and a co-founder of Eureka Trading Systems. Member: ANA, GSNA, CSNS, NBS, ANUCA, FUN, ICTA, and USMexNA. Please call for our auction schedule. Antique Stocks and Bonds; U.S. Coins; Paper Money. STEPHEN GOLDSMITH Executive Vice President, R.M. Smythe & Co., Inc. BA, Brooklyn College. Contributor to Paper Money of the United States, Collecting U.S. Obsolete Currency, Financial History, and Smart Money. Editor, An Illustrated Catalogue of Early North American Advertising Notes; Past President and Board Member, Professional Currency Dealers Association. Member: PCDA, ANA, SPMC, IBSS, New England Appraisers Association. U.S. and World Coins. NIRAT LERTCHITVIKUL has been dealing in U.S. and World coins since 1976. Area of specialties include U.S. and World coins. Nirat has been a contributor to many world coin catalogues, and has authenticated world coins for third party grading services. Founder of Seaclassic.com website. Member: ANA, FUN, NAT, PCSG, NGC, GSNA, CSNS U.S. Coins and Medals. JAY ERLICHMAN Contributor to A Guide Book of U.S. Coins and A Guide Book of British Coins. Assembled and managed investment portfolios of U.S. coins. Employed by the Federal Trade Commission as an expert witness on consumer fraud. Member: ANA, PCGS, NGC. Ancient Coins and Medals. THOMAS TESOR I E RO Proffesional Numismatist for 38 years in New York. Ancient Greek and Roman coins, medieval, world gold and silver, paper money. Long time member of the New York Numismatic Society, involved with the Membership Committee. Member: ANA, ANS, AINA, FRNS. luau... publications N 4131L 0 0 0 0 N 2 Rector Street, 12th Floor, New York, NY 10006-1844 TEL: 212-943-1880 TOLL FREE: 800-622-1880 FAX: 212-312-6370 EMAIL: info@smytheonline.com WEBSITE: smytheonline.comMEMBER Stephen Goldsmith Scott Lindquist TERMS AND CONDITIONS PAPER MONEY is published every other month beginning in January by the Society of Paper Money Collectors (SPMC). Second-class postage is paid at Dover, DE 19901. Postmaster send address changes to Secretary Robert Schreiner, P.O. Box 2331, Chapel Hill, NC 27515-2331 © Society of Paper Money Collectors, Inc., 2005. All rights reserved. Reproduction of any article, in whole or in part, without express written permis- sion, is prohibited. Individual copies of this issue of PAPER MONEY are available from the Secretary for $6 postpaid. Send changes of address, inquiries concerning non-delivery, and requests for additional copies of this issue to the Secretary. MANUSCRIPTS Manuscripts not under consideration elsewhere and publications for review should he sent to the Editor. Accepted manuscripts will be published as soon as possible; however, publication in a spe- cific issue cannot be guaranteed. Include an SASE for acknowledgment, if desired. Opinions expressed by authors do not necessarily reflect those of the SPMC. Manuscripts should be typed (one side of paper only), double-spaced with at least 1-inch margins. The author's name, address and telephone num- ber should appear on the first page. Authors should retain a copy for their records. Authors are encouraged to submit a copy on a 3 1/2-inch MAC disk, identified with the name and version of software used. A double-spaced printout must accompany the disk. Authors may also transmit articles via e-mail to the Editor at the SPMC web site (fred@spmc.org). Original illustrations are preferred but do not send items of value requiring Certified, Insured or Registered Mail. Write or e- mail ahead for special instructions. Scans should be grayscale at 300 dpi. Jpegs are preferred. . ADVERTISING • All advertising accepted on space available basis • Copy/correspondence should be sent to Editor • All advertising is payable in advance • Ads are accepted on a "Good Faith" basis • Terms are "Until Forbid" • Ads are Run of Press (ROP) • Limited premium space available, please inquire To keep rates at a minimum, all advertising must be prepaid according to the schedule below. In exceptional cases where special artwork or addi- tional production is required, the advertiser will be notified and billed accordingly. Rates are not commissionable; proofs are not supplied. Advertising Deadline: Subject to space availabil- ity copy must be received by the Editor no later than the first day of the month preceding the cover date of the issue (for example, Feb. 1 for the March/April issue). With advance approval, cam- era-ready copy, or electronic ads in Quark Express on a MAC zip disk or CD with fonts sup- plied, may be accepted up to 10 clays later. ADVERTISING RATES Space 1 time 3 times 6 times Outside back cover $1500 $2600 $4900 Inside cover 400 1100 2000 Full page 360 1000 1800 Half page 180 500 900 Quarter page 90 250 450 Eighth page 45 125 225 Requirements: Full page, 42 x 57 picas; half-page may be either vertical or horizontal in format. Single-column width, 20 picas. Except covers, page position may be requested, but not guaran- teed. All screens should be 150 line or 300 dpi. Advertising copy shall be restricted to paper cur- rency, allied numismatic material, publications, and related accessories. The SPMC does not guar- antee advertisements, but accepts copy in good faith, reserving the right to reject objectionable material or edit copy. SPMC assumes no financial responsibility for typographical errors in ads, but agrees to reprint that portion of an ad in which a typographical error occurs upon prompt notification. PAPER MONEY • September/October 2005 • Whole No. 239 321 Paper Money Official Bimonthly Publication of The Society of Paper Money Collectors, Inc. Vol. XLIV, No. 5 Whole No. 239 SEPTEMBER/OCTOBER 2005 ISSN 0031-1162 FRED L. REED III, Editor, P.O. Box 793941, Dallas, TX 75379 Visit the SPMC web site: www.spmc.org FEATURES The Treasury Notes of the War of 1812 323 By Donald Kagin, PhD War of 1812 at a Glance 326 By Leslie Deerderf About Texas Mostly: Texas Special Treasury Warrant 360 By Frank Clark Positive ID on Missouri Military Bond 362 By Ron Horstman On This Date in Paper Money History 368, 370 By Fred Reed The Bank of the United States in North Carolina 372 By Bob Schreiner A Short History of the Bank of the United States 373 By Fred Reed Connecticut Raised, Altered, Counterfeit & Fraudulent Currency . 376 By J. Roy Pennell, Jr. When the National Debt Was Actually Paid 393 By Forrest Daniel '8894': Vinegar 1840 $1000 Bank Notes Not Authentic 396 By Richard Giedroyc SOCIETY NEWS SPMC Authors' Forum Whopping Success 352 New Officers, Board Members Highlight Memphis • 355 SPMC Honors Award Winners 357 President's Column 392 By Benny Bolin IN THIS ISSUE SOCIETY OF PAPER MONEY COLLECTORS INC. 322 September/October 2005 • Whole No. 239 • PAPER MONEY Society of Paper Money Collectors The Society of Paper Money Collectors (SPMC) was orga- nized in 1961 and incorporated in 1964 as a non-profit organiza- tion under the laws of the District of Columbia. It is affiliat- ed with the American Numismatic Association. The annual SPMC meeting is held in June at the Memphis IPMS (International Paper Money Show). Up-to-date information about the SPMC and its activities can be found on its Internet web site www.spmc.org . MEMBERSHIP—REGULAR and LIFE. Applicants must be at least 18 years of age and of good moral character. Members of the ANA or other recognized numismatic societies are eligible for member- ship; other applicants should be sponsored by an SPMC member or provide suitable references. MEMBERSHIP—JUNIOR. Applicants for Junior membership must be from 12 to 18 years of age and of good moral character. Their application must be signed by a parent or guardian. Junior mem- bership numbers will be preceded by the letter "j," which wi ll be removed upon notification to the Secretary that the member has reached 18 years of age. Junior members are not eligible to hold office or vote. DUES—Annual dues are $30. Members in Canada and Mexico should add $5 to cover postage; members throughout the rest of the world add $10. Life membership — payable in installments within one year is $600, $700 for Canada and Mexico, and $800 elsewhere. The Society has dispensed with issuing annual mem- bership cards, but paid up members may obtain one from the Secretary for an SASE (self-addressed, stamped envelope). Members who join the Society prior to October 1 receive the magazines already issued in the year in which they join as avail- able. Members who join after October 1 will have their dues paid through December of the following year; they also receive, as a bonus, a copy of the magazine issued in November of the year in which they joined. Dues renewals appear in the Sept/Oct Paper Money. Checks should be sent to the Society Secretary. OFFICERS ELECTED OFFICERS: PRESIDENT Benny Bolin, 5510 Bolin Rd., Allen, TX 75002 VICE-PRESIDENT Mark Anderson, 335 Court St. #149, Brooklyn, NY 11231 SECRETARY Bob Schreiner, POB 2331, Chapel Hill, NC 27515 TREASURER Bob Moon, 201 Baxter Court, Delmar, NY 12054 BOARD OF GOVERNORS: Mark Anderson, 335 Court St., Suite 149, Brooklyn, NY 11231 Benny J. Bolin, 5510 Bolin Rd., Allen, TX 75002 Bob Cochran, P.O. Box 1085, Florissant, MO 63031 Wes Duran, P.O. Box 91, Twin Lakes, CO 81251-0091 Gene Hessler, P.O. Box 31144, Cincinnati, OH 45231 Ronald L. Horstman, 5010 Timber Ln., Gerald, MO 63037 Robert J. Kravitz, P.O. Box 303, Wilton, CA 95693-0303 Tom Minerley, 3457 Galway Rd., Ballston Spa, NY 12020 Judith Murphy, P.O. Box 24056, Winston-Salem, NC 27114 Fred L. Reed III, P.O. Box 793941, Dallas, TX 75379-3941 Robert Schreiner, P.O. Box 2331, Chapel Hill, NC 27515 Jamie Yakes, P.O. Box 1203, Jackson, NJ 08527 APPOINTEES: PUBLISHER-EDITOR Fred L. Reed III, P.O. Box 793941, Dallas, TX 75379-3941 CONTRIBUTING EDITOR Gene Hessler, P.O. Box 31144, Cincinnati, OH 45231 ADVERTISING MANAGER Wendell A. Wolka, P.O. Box 1211, Greenwood, IN 46142 LEGAL COUNSEL Robert J. Galiette, 3 Teal Ln., Essex, CT 06426 LIBRARIAN Robert Schreiner, P.O. Box 2331, Chapel Hill, NC 27515-2331 MEMBERSHIP DIRECTOR Frank Clark, P.O. Box 117060, Carrollton, TX 75011-7060 PAST PRESIDENT Ron Horstman, 5010 Timber Ln., Gerald, MO 63037 WISMER BOOK PROJECT COORDINATOR Bob Cochran, P.O. Box 1085, Florissant, MO 63031 REGIONAL MEETING COORDINATOR Judith Murphy, P.O. Box 24056, Winston-Salem, NC 27114 BUYING AND SELLING CSA and Obsolete Notes CSA Bonds, Stocks & Financial Items 60-Page Catalog for $5.00 Refundable with Order HUGH SHULL ANA-LM SPMC LM 6 SCNA P.O. Box 2522, Lexington, SC 29071 BRNA PCDA CHARTER MBR PH: (803) 996-3660 FAX: (803) 996-4885 FUN PAPER MONEY • September/October 2005 • Whole No. 239 323 The Treasury Notes The First Circulating Currency of the United States* By Donald H. Kagin, PhD/Numismatics © of the War of 1812 / t may come as a surprise to some that the first paper money circulated in the United States after the Constitution was issued in 1815, preceded the Demand Notes of 1861 by 46 years. Occasioned by the War of 1812 and the expiration of the charter of the First Bank of the United States, a total of five Treasury note issues were authorized; the last including small circulating notes of less than $100 denom- inations. Perhaps because of their relative numismatic scarcity and the paucity of information concerning them, there has been little discussion of these precedent-set- ting remnants of the fiscal past of the United States. The circumstances surrounding these first Treasury note issues are discussed here; appendix tables provide system- atic quantitative detail. Introduction Between 1812 and 1815, the United States authorized five Treasury note issues. In total, over $36 million in denominations from $3 to $1000 were emitted. The last issue included non-interest bearing "small" circulating notes in denomina- tions of $3 to $50. Because of the shortage of adequate circulating medium and rev- enue to conduct the War of 1812, these notes proved to be extremely useful as they were transferable by delivery and receivable for duties, taxes, and public use at par plus accrued interest. They also served as interest-bearing reserves for banks since they were convertible into any kind of money and bore interest simultaneously. The success of the Treasury notes was demonstrated by the fact that they were fully subscribed and accepted by the banks and merchants. In addition, the small Treasury note issues of 1815 indirectly served to increase the circulating medium of the country. They were used to buy goods and services by individuals, pay custom duties by merchants, and acted as cash reserves for banks, preventing bank notes from being discounted. They thus became the first circulating paper currency issued by the United States after ratification of the Constitution. PRE-1812 FINANCE From the adoption of the Constitution, until the War of 1812, the U.S. Government had financed its deficits by borrowing. Until 1792, major loans were procured primarily from Holland or in funding operations, while temporary or small `bridge' loans were obtained from consortiums of prominent capitalists or from the four existing private banks, such as the Bank of North America or the Bank of New York. Our first Secretary of Treasury, financial genius, Alexander Hamilton, pro- posed the establishment of a national bank to supersede local and state banks. This was necessary, he argued, to collect taxes and administer public finance, sustain government credit, and provide a source of loans to the Treasury. There was consid- erable Congressional debate with opponents of the bank, led by Secretary of State Thomas Jefferson who warned of potential abuse; that it was not provided for in the Constitution; would destroy free institutions; and benefit only a few. Nevertheless *This article is dedicated to Dr. Douglas B. Ball, my professor when first researching this subject for my doctorate program - Don Kagin On the Cover This painting is a depiction of the naval battle between USS Constitution and the HMS Guerriere August 19, 1812, during the War of 1812. This was the battle that earned the Constitution her beloved nickname "Old Ironsides." The painting is by Anton Otto Fischer, depicting Guerriere's masts going over the side as Constitution rakes her from ahead (U.S. Naval Historical Center Photograph). Just three weeks after escaping from the British squadron off of New Jersey, Constitution was once again at sea patrolling. On the 19th of August, Constitution again came into contact with H1VIS Guerriere, the same British frigate that had begun to chase the Constitution a month earlier. This time, however, the English frigate was alone, and both ships closed in battle. Captain Isaac Hull's official account of Constitution's victory over the 38-gun Guerriere was a rare bright spot for the U.S. military in the war's opening months. Recognized by Guinness World Records as the World's Oldest Commissioned Warship afloat, she escaped destruction in 1830 largely due to the popularity of the poem "Old Ironsides" by Oliver Wendell Holmes. His verse begins: "Ay, tear her tattered ensign down! Long has it waved on high, And many an eye has danced to see That banner in the sky;" Albert Gallatin was appointed Secretary of the Treasury by President Thomas Jefferson in 1801; reappointed by President James Madison, and served from 1801 to 1814. ax Dtrertot• ^, Ph Co. in t. litn3-3x.0 Prennii,e to pus or Bearer. Int denun.l. TEN VZIITE1.1 STATES* PrtA4ens,. 324 September/October 2005 • Whole No. 239 • PAPER MONEY the Hamiltonian Federalists won the day and the bill establishing the First Bank of the United States was enacted on February 2, 1791 and gave the bank a charter for 20 years. Once the First Bank of the United States was established, that institution superseded all others in becoming the primary lender of short-term funds to the government (although a few small loans at high rates were sold directly to the pub- lic during this period). Almost all revenues, for whatever purpose, came largely from customs. Between 1801 and 1806 this income amounted from $11 to $13 million annually, with a small supplemental income from the sale of lands, exiguous revenue with which to fight a world power like Britain.' Until the financial emergencies occasioned by the War of 1812, the govern- ment was firmly committed to a hard money policy. Article 1, sec. 8, clause 5 of the Constitution gave Congress the power "To coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures." 2 While the question of paper money was vigorously debated in 1787 by members of the Constitutional Convention, both a proposal for the inclusion of a provision authorizing its issue by the national government, and one prohibiting issue were defeated. The political thinking of the time, succinctly expressed by Virginia's U.S. Representative James Madison, was that authorizing the use of paper money might lead to mass abuse and proliferation, reminiscent of the vastly depreciated Continental Currency. The original impetus for issuance and use of Continental Currency was to circumvent British laws forbidding the minting of coins by the Colonies. Outright prohibition of paper currency howev- er, would tie the government's hands in case of a temporary emergency. The Constitution therefore, resolved the dilem- ma by specifying nothing. It did proscribe however, the issue of "bills of credit" by the states and by implication, the same issue by the federal government. GALLATIN'S RESTRICTIVE POLICY During the Republican administrations of Thomas Jefferson and James Madison, the architect of the govern- ment's fiscal system was Prior to 1808, Gallatin declined to augment treasury receipts except by temporary loans, even though a year later he belatedly conceded the possible need for internal taxes. 3 It was not until early 1812 that Gallatin's optimism waned and he intimated that the extraordinary impending expenses of the military and naval services would require funds considerably in excess of current revenue. 4 With duty revenue down from $13.3 million in 1811, to $9 million in 1812 (mainly a result of the Embargo of 1807- 1809), and with a corresponding increase to $22 million in expenditures, Gallatin suggested a 100 percent increase in the tariff. In his report, Gallatin justified the proposal on the grounds that "this mode (increased duties) appears preferable. . . to any internal tax."5 The result of this policy was the absence of any system by which internal revenues could be col- lected. This was an error in policy which Gallatin conceded in 1831 when he admit- ted that he should have recom- mended such taxes in 1812. 6 Acting upon the Treasury Secretary's recommendation, Congress soon doubled the tar- iff duties. END OF THE FIRST BANK OF THE UNITED STATES Meanwhile opponents of the First Bank of the United $10 specie from the Bank of the United States States had gathered more Congressional allies during its first 20 years. When its charter came up for renewal SIX PER PENT. ST ()UK OF IS IS. (i) ,Korot"... '0( .t}>" ',3.;onr PS11110ra, DOLL Ills. borior Intrisrf of Si,' pir frown proor ionnor, from Ibeincl.:ray, ',ober quarirmyreirly; Mirk err., St mane. of me .41 e parre,1 on a,. "IA day .Vorrit. 1.119, rofilf ell .ire rsilliori‘i,si Loos for o ions crrisoling Metro Millions f Salim., the Priori's., whichisiinhonablerti ihrplr .ororr f lir 1,15,1 Mars. Iear in21, triad arrbi 4 rrrenteri thi offier, nod ir ssottferoble may by ',foray, in person, or by rdlorney,al proprr ofire, according to dr rider owl/ono, r, hIcrhdJo, idea poop., irt 04.01.c.. 9A1P.A... ASOst•siro.....,4-..s'.. co, 100 STh4.. lit et • ..,.74e1V$ — it\ 0.0 ..„-f....,-- --......_ .ri.c..i..,, .01,..ri.,:i.) ..2,-,..\-tzs /,,,•,,,,..„ ,... .:, /,'„7. /e ... i ■ , ey/ , „/ — on-c a to .s.10-..tialltars , , //, 6,, ,au . .., ,-..,,,/,,,,,,,%) • it ,,,,.//' /4 cid/ '/, ..//9.,3:7/:.:/::.).w. /4/.%) d ,....1 (Above) TN-1 $1,000 Unsigned remainder. Spread Eagle facing right at upper left. Shield and cannon at center. (Below) TN-2 $100 Unsigned remainder. Eagle on branch at upper right. Shield and cannon at lower center (Hessler X-69). Tit'!Thilvti Sint:71 41212127121"1"rrir t - e .$',x.,? (Tovrt WittiD .:61.02 • • f•-../ 44/ ' FIRST TREASURY NOTES Unable to sell long-term debt advantageously and lacking the First Bank of the United States to provide bridge financing, Gallatin recommended the use of Treasury notes. This was not altogether a new suggestion since Gallatin had mentioned that particular mode of public financing as early as February, 1810. Then, in response to an inquiry from the House Ways and Means Committee ("Can any other resources besides taxes and loans be relied on for immediate revenue?"), Gallatin answered: Treasury notes bearing interest, and payable to order one year after day, may be annually issued, to a moderate amount, and be put in circulation, both through the medium of banks and in payment of supplies. 9 The Treasury Secretary further cautioned against possible abuses, but maintained that if kept within strict bounds, the notes would facilitate both the collection of revenue and the loans themselves. In a letter to the House Ways and Means Chairman, Representative Ezekiel Bacon of Massachusetts dated January, 1812, Gallatin repeated his willingness to rely on some use of Treasury notes: Treasury notes, bearing interest, might to a cer- tain extent be issued, and to that extent diminish the amount to be directly borrowed. The advan- tage they would have would result from their becoming a part of the circulating medium, and PAPER MONEY • September/October 2005 • Whole No. 239 325 in 1811, opponents had the necessary votes to defeat it. Additionally, since the mostly British shareholders of the Bank were paid off in specie, there was little pre- cious metal coinage in America. Unfortunately, the Bank's demise could not have come at a worse time, as the renewed hostilities with Great Britain had hit a climax. Britain was already involved in a war with France and during this time their seamen routinely boarded American merchant ships ostensibly looking for desert- ers or military supplies. They then would impress American sailors into service to serve in the British navy. Negotiations with Britain to halt this abuse were futile and on June 18, 1812, President John Madison signed Congress' declaration of war against Great Britain. In anticipation of the war and due to the necessity of using specie or precious metal currency to pay for imports, coinage was hoarded and local bank notes were substantially discounted. CONGRESSIONAL WAR LOAN POLICY In February, 1812 — four months before war was declared — the House Ways and Means Committee realizing that merely doubling the tariff would not yield enough revenue, and without the facility of a national bank, proposed a loan of $11 million which was enacted by a large majority in both houses of Congress on March 14, 1812. 7 There is some disagreement as to the success of this loan. While only $600,000 was subscribed to by the public in the first two months, by the end of the year $8.1 million had been pur- chased mainly by the larger banks. The lack of enthusiasm for funded loans arose from New England's manifest lack of sympathy for the war, coupled with the fail- ure of Congress to provide adequate means to pay interest. Thus, Gallatin was practically forced to issue Treasury notes. 8 Six Per Cent, Stock of 1812. (Hessler X-67A) TIornt.shurgh Fon 1KC l1 4,1‘ OHIO INDIANA TERRITORY Washington, D.C. Duero, • Per, , tots tia4 Au lbrradunax * 11 WAR OF 1812: MAJOR NORTHERN CAMPAIGNS -4 — American forces -4— British forces * battle site Pru ner. Aug, -.Wig /AN CANADA 'fork (Toturat), nntaria NEW • fake YORK QuAnL4tnk it. ton Niagarafietshb, Van Rertittiarr lbeiltIrteN,vtiter .r HD: 1)&41 • 'II. burr ' firsque 4 / 1's - 0 fern Plg. * Put ,O.Say PENNSYLVANIA MASS. AfAkYl VIRGINIA KENTUCKY 207 Milos __I ti Oliver Perry Stephen Decatur Isaac Hull MICHIGAN TERRITORY 326 September/October 2005 • Whole No. 239 • PAPER MONEY WAR OF 1812 AT A GLANCE WAR OF 1812 TIMELINE 1812 June 18 America declares war against the British. This war is known as "Mr. Madison's War" or "Second American Revolution." August 16 U.S. loses Ft. Mackinac as British invade U.S. territory. 1812 U.S. makes three attempts to invade Canada. All fail. 1812 USS Constitution (Old Iron- sides) bests HMS Guerriere. (See magazine cover art) 1813 January Battle of Frenchtown. British & Indian allies repel Kentucky troops. American survivors slain at Raisin River Massacre. April Battle of York (Toronto). U.S. takes control of Great Lakes and burn York. September Battle of Lake Erie. U.S.under Captain Perry defeat a British naval attack. October Battle of Thames (Ontario, Canada). Tecumseh killed in a U.S. victory. 1814 March 27 Battle of Horseshoe Bend (Miss. Terr.). Andrew Jackson defeats Creek Indians. 1814 The British plan 3-part inva- sion: Chesapeake Bay, Lake Champlain, & the mouth of Mississippi River. British turned back at Baltimore. Aug. 24-25 British burn Washington, D.C. Madison flees White House. September Battle of Plattsburgh (Lake Champlain). U.S. secures its northern border with victory over a larger British force. Dec. 15 Hartford Convention occurs. Federalists discuss secession & propose 7 amendments to protect influence of NE states. Dec. 24 Treaty of Ghent. British and American diplomats agree to return to pre-war status quo. 1815 January Battle of New Orleans. Andy Jackson scores major victory 700 British killed, 1400 wounded. U.S. only loses 8 soldiers. THE WAR OF 1812 IS ONE OF THE FORGOTTEN CONFLICTS OF UNITED STATEShistory. Although it lasted more than two years, and ended in something of a stale- mate, historians point out its prime significance as being "a war that once and for all con- firmed American Independence." The United States failed to capture Canada. The British were successfully stopped when they attempted to capture Baltimore and New Orleans, but they invaded and burned signficant parts of Washington, D.C. before withdrawing. American naval vessels proved themselves superior to British vessels. The war resulted from long simmering disputes with Great Britain, the central issue being impressment of approximately 10,000 Americans by the British during the decade before the war. At the President's request, Congress. declared War on Great Britain June 18, 1812. The British had previously attacked the USS Chesapeake and nearly caused a war two years earlier. In addition, disputes continued with Great Britain over the Northwest Territories and the border with Canada. Also attempts by Great Britain to blockade France during the Napoleonic Wars caused conflict with the United States. + WAR OF 1812 AT A GLANCE Baltimore (Sept. 11-13) Fort McHenry MD 2 Washingtonrii# Bladensburg (August 24) VA THE WAR OF 1812: BRITISH CHESAPEAKE CAMPAIGN —. British forces Battle site , maps © W.W. Norton, "The Essential America" Chesapeake Bay a Hon,•1,1w. Bend c■•••.c. ••.4■140 Nr „v-Fon Al ins 1X14 —• "I\ Pensacola ••• Mobile FLORIDA (Spunis.h) LOUISIANA 4./ New Odearti$ r. Per River PAPER MONEY • September/October 2005 • Whole No. 239 327 THE WAR OF 1812: MAJOR SOUTHERN CAMPAIGNS -4 — • American forces 4 British forces 0 * Baltic site 0 The Star-Spangled Banner Beginning at dawn Sept. 13, 1814, British warships bombarded Fort McHenry guard- ing Baltimore continuously for 25 hours under heavy rain. Francis Scott Key, a Washington lawyer, witnessed the bombardment from a nearby truce ship. An oversized American flag flew over the fort. When Key saw the American flag flying still intact in the dawn of Sept. 14, he composed the poem "The Defence of Fort McHenry," which would be renamed "The Star Spangled Banner" and become America's national anthem Of course, it begins with the lyrics, "0 say can you see by the dawn's early light." Its popularity took time, a century in fact. The song only became the official national anthem by executive order of President Woodrow Wilson in 1916, and his order was not con- firmed by an Act of Congress until 1931. WAR OF 1812 SNAPSHOTS Gold Medals Awarded Jan. 29, 1813 2 Stat. 830 Captain Isaac Hull, Captain Stephen Decatur, and Captain Jacob Jones March 3, 1813 2 Stat. 831 Captain William Bainbridge Jan. 6, 1814 3 Stat. 141-142 Captain Oliver Hazard Perry, Captain Jesse D. Elliott, Lieutenant William Burrows and LT Edward McCall Jan. 11, 1814 3 Stat. 142 Captain James Lawrence October 20, 1814 3 Stat. 245-246 Captain Thomas MacDonough, Captain Robert Henly, and LT Stephen Cassin October 21, 1814 3 Stat. 246 Captain Lewis Warrington November 3, 1814 3 Stat. 246-247 Captain Johnson Blakely, Major General Jacob Brown, Major General Winfield Scott, Brigadier General Eleazar W. Ripley, Brigadier General James Miller, Major General Peter B. Porter, Major General Edmund P. Gaines, Major General Alexander Macomb February 27, 1815 3 Stat. 249 Major General Andrew Jackson February 22, 1816 3 Stat. 341 Captain Charles Stewart, and Captain James Biddle April 4, 1818 3 Stat. 476 Major General William Henry Harrison and Governor Isaac Shelby Feb. 13, 1835 4 Stat. 792 Colonel George Croghan Burning of Washinton, D.C. August 24, 1814, was a "bad day" for Washington, D.C. The U.S. was at war with England again.. Rear Admiral Sir George Cockburn invaded Washington, defeated the city's defenders at Bladensburg, MD, and marched to the Capitol. He set the building on fire and then marched to burn the President's House. In between he burned the Library of Congress, the Navy Yard, and the War and Treasury Departments, before putting the President's House to the torch. President James Madison and his wife Dolley escaped to Virginia. The repainted President's House was soon given a new name: the "White House." GULF OF MEXICO 50 100 Kies I 50 100 Kilometers 328 September/October 2005 • Whole No. 239 • PAPER MONEY This Issue of Paper Money Is Historic We at Paper Money pride ourselves on the historicity (historical perspec- tive/accuracy) of our publication. Our writers are excellent researchers and indefatigible searchers after the truth. Sometimes, however, our presentation rises above the high bar we set for our- selves -- until our publication itself becames not merely historical record, but historic in its own right. This issue is one such historic doc- ument, presenting as it does THE definitive (thus far) look at this nation's first post-revolutionary circulating cur- rency. Because of their rarity, the U.S. Treasury Notes of 1812-1815 have languished in obscurity for nearly two centuries. Although both Hessler and Krause-Lemke have cataloged the notes, their exclusion from Friedberg (early eds.) relegated these important notes to the fringes of our recollection and the backwaters of our hobby. These national notes suffered the same fate of much of America's heart- land. They became the "fly over zone" between the coasts, Colonial/ Continental Currency on one side of the chasm, and the Greenbacks of the Civil War at the other shore. But, as late financial historian, cur- rency expert, and SPMC member Dr. Douglas C. Ball put succinctly: "The War of 1812 was, in time- honored fashion, financed largely through government issues of bonds and treasury notes. When bond sales faltered, the treasury first issued inter- est-bearing notes of high denomina- tion, then non-interest-bearing notes clearly meant for circulation. Emboldened by the popular accep- tance of these notes, which were received everywhere at par without exchange charges, Secretary of the Treasury George M. Dallas in 1815 proposed a permanent $10 million government currency. President Madison echoed such views, asserting that if Congress did not charter a new national bank it might consider whether a government currency should be issued as a medium of exchange." Several years ago the Society awarded its George W. Wait Memorial Award to member Forrest Daniel for another look at War of 1812 currency, and it was our intent to include Forrest's perspective in this issue also. Several delays, however, have prompted our decision to publish SPMC member Dr. Kagin's paper in this issue. Hopefully, a future issue will see publication of Mr. Daniel's fine work, also. -- Fred Reed, Editor taking, to a certain degree, the place of bank-notes.'° This was the first statement by a U.S. Secretary of the Treasury in favor of a federal currency (that is, circulating Treasury notes). Within six months, Gallatin realized that the Treasury was in deep trouble and urged the House Ways and Means Committee to authorize $5 million, in 5-2/5 per- cent Treasury notes payable one year after date of issue. To enhance their accept- ability, he proposed that the notes be receivable by the Treasury for all duties, taxes, or debts due the government.n He further recommended in a later message that the notes be fundable into bonds of the loan for which they were intended to be a partial substitute. This would have the double advantage of helping to sell bonds while keeping the issue of the notes within bounds. DEBATE IN CONGRESS A bill embodying these ideas was duly reported out of the House Ways and Means Committee on June 12, 1812, where a heated debate ensued. The Niles Weekly Register reported that the controversy over the Treasury notes was the highlight of the legislative session. 12 Every possible argument ever made against the use of paper money was voiced by the opponents of the bill. They claimed that the notes were not equal in value to gold or silver and would therefore not be taken by banks or people preju- diced against the government paper; that if received they would circulate at a dis- count, and would further subvert public and private credit; that to allow banks to deposit the notes with the Treasury in exchange for bank paper merely emphasized the description of the government paper; that as with the Continental Currency, these notes would greatly depreciate; that the very need to use them was a confes- sion of impending bankruptcy; and finally, that if they had to be issued, there would have to be a direct tax in order to redeem them. 13 Proponents of the bill however, proved more pragmatic. To begin with, they argued, there was a shortage of an adequate circulating medium. Silver was already in short supply because shiny new coins were in demand in Latin America and abroad for the China trade, while gold was undervalued at the mint and hoarded leaving little to be delivered for coinage. The alleged poor and depreciated quality of many bank notes (especially since the retirement of the Bank of the United States circulating notes), ensured that a soundly managed Treasury note currency would be a welcome addition to the U.S. economic system. Depreciation would be checked by their receivability for taxes and public use while their value would be sustained by the fact that the banks would hoard them as interest-bearing reserves. The banks will be glad to receive these notes in exchange for their own; . . . the Treasury notes bear a daily interest and their own bear none at all. They are immediately convertible into any kind of money desired; for the banks always have customers who will use them in payment of bonds due the United States for duties, etc. They are thus better as deposits than specie—gold and silver; for gold and silver lie dormant in the vault—whereas the Treasury notes will be active capital, every hour becoming more and more valuable, and as fully com- petent to all the purposes of the banks as specie, because they will produce it. From these brief remarks it will appear evident that Treasury notes, the moment they are issued, will be hoarded up by the banks, if they can get them. . . . 14 The positive arguments, aided by the inability of the opposition to fill the Treasury by any other means, prevailed and the bill authorizing $5 million in Treasury notes passed the House of Representatives on June 17, 1812 by a vote of 85 to 41. 15 Final enactment of the bill came on June 30, 1812, nearly 12 days after war was declared. TERMS AND SUCCESS The law, which conformed to Gallatin's proposals, authorized the President to issue up to $5 million in denominations of $100 or more (although only $100 and $1,000 notes were actually issued). They were redeemable one year after issue at 5.4 percent, or 1-1/2 cents a day per $100. All the notes were payable to order, transferable by delivery and assignment on endorsement, and more importantly, nleUnited Sta vs PAPER MONEY • September/October 2005 • Whole No. 239 329 were receivable for duties, taxes, and payments for public lands at par plus accrued interest. 16 The first Treasury notes were signed by designess of the President Madison at a compensation of $1.25 for each 100 notes signed. After the - -- - notes were signed, they were sent to the U.S. Commissioner of Loans for the state where the respective notes would be payable. The fee was reduced to $.75 per 100, as part of the Act of December 26, 1814 The first issue was quite successful. By the end of 1812, ( ) $3.5 million had been sold to, or were contracted for, by the banks. The majority of which were located in the Middle Atlantic States. 17 The rest of the bills were disposed of by December 1, 1813 of the following year, with New England absorbing a considerable portion of them. All notes, except for a few $100s, were redeemed by the end of 1814 and with- drawn from circulation. 18 Although the initial shock of the war had temporarily depressed the prices of public bonds dur- ing late 1812, the new loans and Treasury notes sold at par. 19 An editorial in Niles Weekly Register touted the new notes by stating, "This plan appears the most eligible that could possi- bly have been adopted, as it will mutually accommodate the Government and the people, and be advantageous to both." 28 There is some question however, whether these first notes actually circulated. Newly appointed Treasury Secretary Alexander James Dallas in a letter to William Lowndes, Chairman of the House Select Committee investigating the chartering of the Second Bank of the United States, reported that the Treasury notes had met with opposition and had been willingly accepted only by "necessitous creditors, or contrac- tors in distress, or commissaries, quartermasters, and navy agents acting officially. "21 He went on to point out that even when received they were instantly used to make tax payments to the government, "thus disappointing and defeating the only remaining expecta- tion of productive revenue." 22 The Niles Weekly Register claimed that the banks were hoarding these notes. 23 No doubt these banks were using the new interest-bearing Treasury notes as reserves, thereby creating a corresponding increase in the money supply. 24 Evidently the bankers were quite content to collect the rather generous 5-2/5% interest rate rather than circulate the notes. In either case, they were not freely cir- culating as hand-to-hand currency, which was scarcely surprising in view of the high denominations involved, the transfer-by-endorsement-only rule, and their util- ity as bank reserves. NEW WAR LOANS By the beginning of 1813 it became apparent that the war-loan policy hereto- fore pursued was hopelessly inadequate. With expenditures running $28.5 million more than receipts, new revenues were an urgent necessity. 25 Yet it was not until the middle of the year that Congress took any new steps to meet the Treasury's expenditures. Even President Madison refused to recognize the facts of life and in an incredibly myopic statement proclaimed that the Treasury receipts up to Septem- ber of 1812 were "sufficient to defray all the demands of the Treasury . . . and will enable us to defray all the expenses of this year." 26 As a result, instead of immediately implementing new tax programs, Congress, fol- lowing Treasury Secretary Gallatin's monetary suggestions, authorized a new loan of $16 million on February 8, 1813. Realizing at the very last that there would be difficulties in selling these bonds, Congress left the rate of interest and sales price to the Secretary's discretion. The resistance to this new loan was all but total. Even in Congress it was ener- getically attacked on the ground that no special fund had been set apart for its repayment and that the war, for which great expenses were to be incurred, should never have been declared in the first place. 27 Subscribers were not only quick to j ' a/ L. +WI ll1:111)11,g1/,/,‘ //a 3 //: a. a 1/ a/t7 /kr/ ./(://- a/ lee,,,y7/* yIN , IL.; 7 /a ././/: / ,/./7 1,2 fis.(irt:IWINISO ..1) • ,k4 1,1 f.t.u.o.,M) !II c, tutcb ..,")to t Slates u . 1 TN-2 $100 Uncut pair of Unsigned remainders. An eagle on a branch at Upper right. Shield and cannon at lower center. • ■ S4iitte0 .•■‘,31(461 t 330 September/October 2005 • Whole No. 239 • PAPER MONEY realize that there was no redemption fund, but that the war was going badly and would be worse yet if the British could finish off Napoleon and direct their undi- vided efforts at America. Moreover Gallatin, frustrated with congressional reluc- tance to follow his recommendations, disgusted with the open antagonism dis- played by members of his own party, and sensing that it was too late to make the necessary fiscal amends, took a diplomatic leave of absence, thereby abandoning a Treasury mixed in total confusion. 28 When the new loan was offered on March 12 and March 25, 1813, only $500,000 was subscribed to on the same terms, 6 percent, as the previous loans. 29 The Government was accordingly compelled to sell the rest of the loan stock at a 12 percent discount. Even more embarrassing, the Treasury was forced to make the same concession of a 12 percent discount to those who had earlier purchased loans at par, such as Stephen Girard, David Parish, and John Jacob Astor who were allegedly front men for foreign investors including the Rothschilds. The revelation of this did nothing to improve the Treasury's prestige or credit. 39 SECOND ISSUE OF TREASURY NOTES The difficulties of floating the $16 mil- lion loan along with the necessity of having to borrow an additional $19 million forced another issue of Treasury notes. As suggested by Gallatin in December, 1812, Congress authorized the issue of $5 million in new Treasury notes to replace those of June 1812. 31 The Congressional debate was as arid as before with the bill passing the House: 79 to 41. 32 The terms of issue were identical with the preceding notes, with the exception that these were to be redeemed by March 31, 1815, although in the actual event the last payment was not made until the fourth quar- ter of 1820. 33 Thus by the summer of 1813 the pattern of financing the war had been set; it could" in long-term loans and make up the dif- At the same time nothing had been done to sup- which now approached $10 million; a sum equal TN-6a $100 Double signature remainder. Eagle on branch at upper right corner. Shield and cannon lower center. Signed by Edward Fox and Samuel Clark. (Hessler X-74C) Congress would raise as "much as ference by issuing Treasury notes. port this mass of floating currency to one year's peacetime revenue. INTERNAL TAXES It was at this time that Congress was compelled to consider internal taxes. On May 24, 1813, a full year after the outbreak of war, President Madison called a recalcitrant Congress into special session and told it that the time was long past due for producing a "well-digested system of internal revenue." 34 Spurred by the President's remonstrances and reluctantly recognizing the impossibility of raising all needed funds by borrowing, Congress halfheartedly passed a few direct levies. There were however, serious problems associated with collecting this revenue. As Gallatin had dismantled all the internal revenue machinery in 1801-1806, it took a year to collect even the small, inadequate amount legislated. Nor could the Treasury get any bridge financing in the interim. Anti-war proponents, especially in New England, balked at every effort to get them to help. Indeed, the Federalist New England press declared that no true friend of the country would be found among the subscribers to such loans. Opposition was so great that advertisements for war bonds in Boston papers had to promise anonymity to would-be subscribers. 35 By the end of 1813, Government finances were in poor shape. Anti-war senti- ments chilled bond sales as did the Congressional reluctance to provide revenue as backing. Moreover, the banks were either unable or unwilling to lend. Thus the Treasury was compelled to issue even more Treasury notes. By 1814 the situation was critical. Not only had expenditures risen consider- branch at upper(Below) TN-8 $100 Unsigned remainder. Eagle on right corner. Shield and cannon below center. ) , , / /1/ ilited r :)."9:1403) ./.../P2L,1614.9 ii 7.:r/ //..iN 4/5: a ,././ di a f f;/: V///e//// 1.// • ri i) , (41/), /47' ////'///:)At:, ry1:4C11//' la; S ) u.4 (Above) TN-8a(2b) $100 Double signature remainder. Eagle on branch at upper right corner. Shield and cannon below center. Signed by Edward Fox and Samuel Clark. (Hessler X80C) / —1 ' , , , 77 /., —211 ' ,1 711?e,,e. , / Ie7, i ,//- ,/nr.rifr( . ■ 0, ) I ' ( /1/ ; \ V) 141.CV) :OP/21:11e '; ) , /// ////i • f ///lI'L /if 1/14 /r ./1 ,/, %//7,0r,/ 147 r// ...r , ..-..;;/./ e,/// I //, // /////(///.///,:/i •),/t/i /4 /hi .7 71/(r..,/, , r/ 26 A.:, ' i,Vi • rtro LiVi5IMuk6 ( ( 434 ,/ri// , -7;Pe- f4-4, 1/'; he b la es/, 77 ., ,,,, y 1",1 9- PAPER MONEY • September/October 2005 • Whole No. 239 ably, but revenue from import duties had drastically declined. 36 Once again, Congress resorted to borrowing for its revenue. This time $25 million was authorized, the largest that had ever been attempted, and this only after much spirited debate on the entire question of the war. 37 Three subscriptions were offered, each one failing worse than the previous one. Discounts up to 20 percent, including provisions for accepting subscriptions in Treasury and state bank notes, had to be provided. An additional provision required that if more favorable terms were granted, the same terms had be provided for any previous loans. 38 During the summer and fall of 1814 this latter provision led to considerable speculation and embarrassment, which further depreciated the value of government stock and marked the lowest point in the govern- ment's effort to finance the war. THIRD ISSUE OF TREASURY NOTES The same March 14, 1814 Act authorizing a $25 million loan also provided for $10 million of Treasury notes, half of which were considered to be part of the $25 million loan. In his report of December, 1813, acting Treasury Secretary William Jones, who was appointed by President Madison, urged the further use of Treasury notes: The certainty of their (Treasury notes) reim- bursement at the end of the one year, and the facilities they afford for remittances and other commercial operations have obtained for them a currency which leaves little reason to doubt that they may be extended considerably beyond the sum of five millions of dollars, hitherto autho- rized to be annually issued. 39 By that time it would appear from the con- gressional debates and statements by the Treasury Secretary, that public policy called for the issue of no more Treasury notes than could be support- ed by fiscal revenues. Should more be issued, they would be in lieu of, or as an adjunct to, stock loans. Although there was an attempt to amend the bill, which would have prohibited the issuance of notes in denominations of more than $100 or less than $5, only three denominations, $1,000, $100, and $20 were issued. 48 The use of a $20 note, even though interest bearing, was a significant departure from previous practices, for they were clearly intended to serve as a de facto hand-to- hand currency. Proof of their intended circulation can be found in Tennessee Governor William Blout's October 12, 1814 letter to the new Treasury Secretary Alexander J. Dallas in which the former stated that he had endorsed $100,000 in Treasury notes, "so that they may go into circulation." Blout subsequently deliv- ered the notes to Postmaster General W. B. Lewis to distribute. 41 The third issue did not satisfy public demand for a circulating currency and the general suspension of specie payments outside New England forced a review of Treasury policy. In October, 1814, Chairman of the House Ways and Means Committee, John Eppes, solicited from Treasury Secretary Dallas, suggestions on how to revive and maintain the public credit. 42 Dallas's perspicacious, if lengthy reply, mentioned the prevailing apprehen- sion over the government's credit and characterized circulating currency as a "copi- ous source of mischief and embarrassment." Exportation and hoarding by individu- als of specie, he explained, had considerably diminished the fund of gold and silver coin. Even worse, the suspension of specie payments had "suddenly broken the 331 7 , /I. ' "'"7 / ' .s-4,72Av (0.11;ciittil:3011.m. e/;-■/: ail.- a/ /.4 Arv.1/ //. • ) -61ilitcb-7 %=--;.tatis /I/ / 7, 7/, 77:7 /1/ / . '//. r.s77'.6.72 .117:17,Pi •• /• Z." (0 h;Clatr"OtIliaM / //, • //, /X: e/;//,to./ //hi,/ / , t,e7 +.1.4e ( -/:144 eh id()7A, TN-9a(2b) $700 Uncut pair of double signature remainder. Spread Eagle on Shield at upper left. "20" surrounded by cor- nucopia in lower center. Signed by Edward Fox and Samuel Clark. (Hessler X-80A) Alexander Dallas helped his friend, Gallatin obtain funds to fight Britain. The war nearly bankrupted the coun- try by the time Dallas replaced Gallatin as treasury secretary in 1874. September/October 2005 • Whole No. 239 • PAPER MONEY chain of accommodation that previously extended the credit and circulation of the notes which were emitted in one State into every State of the Union. . . ." "There exists at this time," he continued, "no adequate circulating medium common to the citizens of the United States." 43 As a remedy he suggested that "under favorable circumstances and to a limited extent, an emission of Treasury notes would probably afford relief."" He did point out however, that the notes were "an expensive and precarious substitute for coins and bank notes." The Secretary concluded that the notes might be issued under the auspices of a national bank. "But whether the issues of a paper currency proceed from the national treasury or from a national bank, the acceptance of the paper . must be forever optional with the citizens." 45 In other words, under no circumstances did the Treasury Secretary want the notes to be legal tender, although they should be receivable for all public dues and taxes— that is they were partial legal tender. In an attempt to establish a uniform national cur- rency, the President called Congress into special session on September 19, 1814. Congress ducked the question however, when it authorized a $3 million loan subscrib- able in Treasury notes. No stock was issued under this act but $1.45 million was borrowed from banks under special contracts. 46 FOURTH TREASURY NOTE ISSUE It was not long after the enactment of this measure that Congress decided to issue more Treasury notes in preference to another issue of stock. With little or no debate, both Houses authorized another issue of $7.5 million. These notes were to be in lieu of Treasury notes authorized by previous loan acts. This December 26, 1814 Act also authorized an additional $3 million of notes to defray war expenses for 1814. Most of the bill's provisions were identi- cal to the Act of March 4, 1814 and resulted in the issuance of a total of $8,318,400. 47 Historian John J. Knox reported that $20, $50, and $100 notes were issued (although there are no records of $50 bills having ever been printed). It was the unenviable duty of the Treasury Secretary Dallas to report early in 1815 that the Treasury was virtually empty and without credit. Some $98 mil- lion had been borrowed during the war, leaving a funded debt of $68 million, while a deficit of $40 million was esti- mated for 1815. 48 New loans had been solicited abroad but none were available. Fiscal revenues were far from adequate, and a uniform circulating medium still had not been achieved. A new monetary expedient was necessary. 49 SMALL TREASURY NOTES In the October 10, 1814 report of the House Ways and Means Committee, Chairman Eppes argued that in order to secure the circulation of Treasury notes, small denominations should be issued. They should be payable to bearer, transfer- 332 4.4+4 4474444,44,4,44.04,4V.V44:0 4 4....44.444.4.74.40:44-0410"03,044,444,44,4044 47 Pt 40e".43 -tat400+40,044-, ted-a 4.4 . . . . 44, 44e to . th h. tatat....+4,.. . 4.-.4+444', funtco sirA EN Ili 14 ITNT. .1'" 1 '1,01, Isis. Lo 1 ,4041, 14 . 1... ■■■, l'..“,. SIAirt.. t: ,,,,, 1 Int tt ...; i, o &Mt; Cmil'9, 71141 . tohytt.toeolt SE I tlf..1. ft En t•EA-r sral . b . OF I.". d4 Fttam of the Etter to ST cra.. to the mamma ItI5 taiil itheet.1 rn,r.4 ■14 ; the tratitkate. Lama ht.10,11 eart«Iledlahtl ot •1,1 v{ eh! atm. in II, 6.44 of Mitt ofSta, mlt, thitt flat< Itkh.00t tratrferoble to the t t#rat of the told to the of the I., NV tout,. from the Neettlary of the Trevor, 70:0,.+4+wsom +=*4 1815 Seven Per Cent, Stock of 1815, unsigned remainder. ( Q1 111 C.1.1 st t. I )1 1111101 /i i. ./i4/1. //X 100 • (Above) TN-10P(a) $100 Punch hole cancelled Proof with 9 holes. Eagle on branch at upper right corner. Shield and cannon below center. (Hessler X-85) (Below) TN-10 $100 Unsigned remainder. Eagle on branch at upper right corner. Shield and cannon below center. S (01,1ite04-4tate5 -4 -44 ,r) rpa mit / /./ „,„; ; //,/// r thic ,,/ /,, r 1 r/y;-; /././ (;„7,e.„ /■/:, PAPER MONEY • September/October 2005 • Whole No. 239 able by delivery, and receivable in all payments for public lands and taxes. Internal revenues should be pledged for payment of the interest, and the notes should be fundable into 8 per- cent stock or redeemable in specie after six month's notice, by the govern- ments° This was a radical departure for Dallas, who had never before sug- gested non-interest-bearing notes as a national circulating medium. These views were repeated at the end of November, when Eppes wrote to Dallas about the proposed National Bank. In his December 1, 1814 reply, Dallas stated that with specie pay- ments suspended, a National Bank would be difficult to establish and that the "introduction of a national circulating medium. . ." was necessary. 5 I Later that month Dallas reported that "Notes of a smaller denomination than heretofore issued have been prepared. . . ."52 This is revealing because no Congressional resolution for small Treasury notes was forthcoming until the next month. On December 11, 1814, Representative Bolling Hall of Georgia introduced a resolution that directed the House Ways and Means Committee to inquire into the expediency of authorizing the Secretary of the Treasury to issue notes convenient for circulation. In one of his five resolutions, Hall proposed that these bills "shall be a legal tender in all debts." 53 The House agreed to consider Hall's resolutions with the exception of the legal tender clause. By a vote of 42 to 95, the first attempt to discuss a legal tender currency was defeated. The entire small Treasury note issue was briefly commented upon and soon laid on the table by a large majority. 54 A subsequent resolution of January 7, 1815, was introduced by Representative Lyman Law of Connecticut. He proposed to make Treasury notes receivable in payment for fines, forfeitures, penalties, and taxes owed to the United States. It seems that, contrary to the reports of the Treasury Secretary, many of the tax collectors were refus- ing Treasury notes. In spite of this request, the resolution was laid on the table by a vote of 61 to 56. 55 Two weeks later, in his State of the Treasury report to Congress, Secretary Dallas made a proposal similar to the resolution by Eppes and Hall. Treasury notes amounting to $15 million. In his report, he suggested that "The denominations of $100 and upwards, shall be made payable to order and shall bear an interest of five and two-fifths per centum per annum." Notes of a denomination less than $100, but not I ess than $20, would either be payable to order and bear an interest at the same rate, or shall be payable to bearer, and not bear interest. Notes under $20 would be "payable to bearer and shall be cir- culated without interest." 56 A bill incorporating Dallas' recommendations was introduced in the House on January 30, 1815 and referred to the Ways and Means Committee. The bill passed the House on February 11, the Senate on February 21, and became law on February 333 •\ ,7 . UNITED STATES ,O; of Colv:vr. 011 ,i (1414-4/i TN-77a(1) $50 Singlely signed by Samuel Clark. Spread Eagle on branch at upper right corner. CA 1- S Mai 23t 1815. ---. yitin - . , • ",-":7•C,... A%•/4- Act of Coly.41r. ol Felar1113. / . • , ....... //7117:k*e.,7 TN-71 b(1) $50 Fully signed, punched hole cancelled. Spread Eagle on branch at upper right corner. Signed by McGreary, Biddle and Nourse. (Hessler X-83E) Nlarelif..Kit 1815 . 1,/, ////:?"6/. //, 4/, ENTY /, /2% — „/ .,.,/„/.,, e , \xi on ;41.ei, of 1. -v1r:/1”: 1813. TN-12P $20 Punch hole cancelled Proof with 9 holes. Eagle on branch at upper left corner. "20” surrounded by cornucopia in upper right corner. September/October 2005 • Whole No. 239 • PAPER MONEY334 24, 1815. 57 As originally proposed, there would have been an issue of $15 million redeemable in five annual installments of $3 million each, for which land tax was pledged. Connected with this scheme was a proposed interest bearing loan of $25 million. During debate, the bill was amended to reverse the amounts of bonds and Treasury notes, so that there were now to be $25 million of the latter. While the bill was being considered, Eppes wrote to Dallas requesting additional information. Once again Dallas urged the use of small Treasury notes in preference to state bank notes as the national medium of exchange. He warned Eppes however that, "considering the outstanding amount of Treasury notes, any new issue should be made to rest upon a basis that will enable the government to employ it both as a circulating medium and as the means of raising money in aid of the revenue." 58 The treaty of peace with England was received a few days before the bill passed (rendering it no longer necessary as a war measure), but it was enacted as a means of paying off the arrearages of the war. It was also intended to give a circulating medium to the country superior to state bank notes. Notes issued under this act were denominated `small' if under $100, and 'large' if $100 or over. Unlike the first three acts of the series, these notes were not chargeable upon the sinking fund, nor were they payable out of any money in the Treasury not otherwise appropriated as in the previous Act of December 26, 1814. Instead they rested entirely upon the provision making them fundable into stock. The small notes were fundable in 7 percent stock; the large ones in 6 percent certificates. Of the $25 million authorized, only $4,979,400 in $100 notes and $3,392,994 in small notes consisting of $3, $5, $10, $20, and $50 notes were actually emitted. 59 The small Treasury notes however, were reissued so that a gross total of $9,070,386 was dis- bursed. 69 •7-7/, /// 4/4;1/ SUCCESS OF THE TREASURY NOTES Just how successful were the Treasury notes as a circulating currency? Secretary Dallas in a December, 1815 report, stated that the notes issued prior to February 24, 1815 were of denominations too high to serve as current medium of exchange. Although the Treasury Secretary was correct in this assumption, the large Treasury notes ($100 and over) indirectly served to increase the circulating money stock. Their utility as short-term (one year) interest earning assets with vir- tual legal tender status made them extremely desirable as bank reserves. With bank notes no longer refundable in gold (except in New England), and specie no longer available, as economic historian Richard H. Timberlake has pointed out, "what could be more attractive to a bank than reserve assets that are legal tender and yet returned interest income as part of the bank's investment portfolio?"6I * * ,ItAgfiareAPE, RUM 4 ** ** SPMC LM #6 CSA, Obsolete Banknotes, Scrip, Bonds, Checks & Paper Americana PAPER MONEY • September/October 2005 • Whole No. 239 335 ************************************************** CSA & OBSOLETE NOTES ARE MY BUSINESS!! ****** I have been a full-time dealer in Confederate and obsolete currency for over 28 years. I've helped many collectors assemble complete CSA type sets as well as find rare varieties. I've also helped hundreds of collectors with their obsolete note interests from rare to common. My catalogs are well known in both the dealer and collector fields for their reference value. If you are a serious collec- tor of CSA notes, bonds or obsolete bank notes, I can offer you the following: 1. Thousands of bank notes in the Confederate and obsolete areas. 2. Accurate descriptions, grading and fair prices. 3. Reliable dealings with prompt and friendly service. 4. The knowledge and research capabilities to properly attribute these notes. 5. A want list service that has helped many find notes which they could not locate. 6. Top prices when buying one note or an entire collection. If you are selling, I want to buy your notes! 7. The respect and integrity of dealings that are well known in the hobby. * 8. Representation to bid for clients at major auctions. * 9. Paying finder's fees on collections referred to me. * 10. Appraisal services for reasonable fees. * 11. Institution and Museum services for note authentication and valuations. * 12. Strong cash decisions and immediate payment for your material. ** * ********* If you collect, I offer my 2nd edition 2004 60-page catalog for $5.00, refundable on first order. It features one of the largest CSA note inventories available, an extensive obsolete and scrip section, uncut sheets of notes, U.S. fractional notes, a Continental and Colonial section and a reference book section. Whether you are buying or selling, I would be pleased to have you contact me. HUGH SHULL •• •• ,••• ••• • Charter Member SOCIETY ya.pgploNo. "TWENTY-EIGHTH YEAR IN BUSINESS" P.O. Box 2522, Lexington, SC 29071 LM #6 PH: (803) 996-3660 FAX: (803) 996-4885 o.a cr 0' 0 ° LOUVE181:002 $0 LIP. Whereas, it in believed that JOHN A. LAWRENCE. of troy, N. Y., ie heir W. QI law to a large Estate in EngInndr called l•Thrigipecaley Emma.' • w And whe reas. de, ,,fornPli ,h the maid La is d cull same i n, obliged low roof recover ieemonoy by in ing pow on thereof, and in ning Scrips, which ar cwi Now therefore. for and in consideration or poliora to 'Tie in hrt to ho the first lien on wid Esae. paid. I hereby agree to pay tbe hearer of thisLlerip yei'Leehr., Dollars out of the firm mane, reeeiwal Men said Estate, and I do further ogre espend said money. reeeived for said Seri, for 7covery Wid Berate. Dated. Tory, Patton,. t$16. 33.10.0•46140.90ii************************************************** %ti .1%;:r•Ak -6,14166-7(14tatte.6 /10' the C717XP ;•';)? .;•,- 4 • /14; /,t.rx,yi A.; /:// /2/'. /- '//.7 • , Counto4ed (Above) TN-13a(2a) $10 Double signature remainder. Eagle on branch at upper left corner. Text at right "Receivable every where by the UNITED STATES in payment of duties, taxes & public land." Signed by McCeary and Biddle. (Below) TN-14a $10 Double signature remainder. Eagle on branch at upper left corner. No text at right and minor changes. Signed by Clarke and Fox. (Hessler X-83C) l'oeultrniputl ides0 uteb • The IT F. fp myrtv,-; _ ///'4, //?, / TEM ,••• •••- 2;4.72/, / , September/October 2005 • Whole No. 239 • PAPER MONEY336 The author wishes to acknowledge Ron Horstman, Glen Wright, Jim O'Neil, Eric Newman, Joel Anderson, Ron Benis, Ashley Billingsly, John Wilson, Bill Youngerman, Mary Counts and Rayce Newman for their invalu- able assistance in the preparation of this updated manuscript. There were of course the usual skeptics. The small Treasury notes, fundable at an inter- est of 7 percent (though of a convenient denomination for common use, Secretary Dallas asserted), "would be converted into stock almost as soon as they were issued." 62 Even President Madison in his veto message on the Bank of the United States on January 30, 1815, stated that no "adequate advantage arises to the public credit from the subscription of Treasury notes." 63 A more thorough analysis, reveals not only that the Treasury notes were successful in helping the public credit and as bank reserves, but also that they did indeed cir- culate. An editorial in the Richmond Examiner of December 31, 1814 urged more people to accept Treasury notes. They were superior, the writer claimed, to the Exchequer bills of England, and already many people were accept- ing the notes. 64 The same paper reported on January 10, 1815, that the Treasury notes "are rising fast in our market. They were sold yester- day, not merely at their nominal value, but with the interest added." 65 Both John Jay Knox writing in 1884, and numismatic scholar Walter Breen, asserted that the $100 Treasury notes depreciated some 8 to 10 percent. This may have been true in New England against their specie controlled notes, but published accounts in various papers do not generally bear this out. Indeed, the May 20, 1815 issue of the Baltimore Sun stated, "Treasury notes are now in demand and will soon, everywhere, bear a premium nearly equal to the amount of interest they may have accrued on them, on account of the uncommon sums speedily to be paid for duties at our custom-houses." 66 That same day, the Niles Register quoted a report in the Boston Patriot that, "Treasury notes pass at par in Canada. A Canadian will give his hundred silver dol- lars for a Treasury note of that sum." 67 This is a powerful testimonial when it is remembered that it emanated from the most intensely anti-war city in the nation. Another editorial in the Niles Register surmised that the Boston brokers were angry with the Secretary of the Treasury for not letting them fund Treasury notes on their terms. The editor concluded that this was the reason the Boston brokers had tried to discredit the notes by claiming they had depreciated as a result of the war. This assertion by the Boston merchants, the editor continued, was not a credi- ble one since the duties and taxes for which the Treasury notes were payable (and therefore useful) could retire double the amount of notes in the people's hands. 68 Since the demand for these notes was twice the supply, there was certainly no reason for them to depreciate, but instead they should have and did command a pre- mium. Two of the best pieces of evidence to support the success of the Treasury notes can be found in two advertisements. In the Richmond Examiner of June 7, 1815, a certain Hugh Chambers offered: "Par will be given for One Hundred Thousand Dollars worth of Treasury Notes." 69 The other advertiser, this time in the Washington National Intelligencer of August 15, 1815, offered to pay a premi- um for Treasury notes. 70 If merchants, albeit speculators, could pay a premium for Treasury notes, it can hardly be asserted that the bills were severely depreciated. Indeed, the only notices in the media that suggested depreciation in the Treasury notes were found in Boston where a certain banker stated that the 7 percent Treasury notes (and probably all non-New England paper) go at an 8-1/2 to 9 per- cent discount:7 i This was logical because New England never suspended specie payments. Since specie was the conventional medium and only New England bank M53433439:- .:73trai:4 A3 el 85 1899 Silver CertificateMkj FrO278 1 erhee 1 Burke run WON GrlIteill SIN M584334103 pp A 64 PAPER MONEY • September/October 2005 • Whole No. 239 337 TRUST YOUR TREASURES TO THE INDUSTRY'S Ith ERRED I-1\1' ,1)ER Label Features Preservation. Identification. Appreciation. Prominent display of Your notes deserve the best. That's why PMG developed this holder—combining cataloging information the qualities that collectors value most. The PMG holder... and grade Security features such as hologram, bar code, and reiterated grade Generous area for graders' comments ...Is made from the highest-quality, inert materials. It contains no openings or perforations—guarding against environmental hazards and contaminants. ...Features a large label that displays precise and specific information about your note, including a full attribution, pedigree, and graders' comments, as applicable. „Accommodates a wide range of currency albums. Your notes take center stage with protective materials that maximize superior visibility. PMG's primary commitment is to provide accurate and consistent grading of paper money— to impart confidence and reliability. This also includes understanding what numismatists want from a holder. And that's why we are bringing a new standard of impartiality and integrity. To learn more about PMG, visit www.PMGnotes.com , or contact Glen Jorde, Grading Finalizer, at 877-PMG-5570. C Join thecommunity www.collectors-sodety.corn 4ZPMG PAPER MONEY GUARANTY P.O. Box 4755 I Sarasota, FL 34230 877-PMG -5570 (764-5570) I www.PMGnotes.com An Independent Member of the Certified Collectibles Group •..44 11:440= tck ,isip: v.t.t.::(KWAXA: VICt ' STAIM4,1 ) ■.1 lava pt,{tVir 1.'' TIM 4,4 ; /e . „(4',•,.•! • 2- - // 7/ l'o .warroi,tvel 338 September/October 2005 • Whole No. 239 • PAPER MONEY TAEASET.11/ VEP.ENTALE.W. apir 3515.. f ; x=41=4 Si: Uket 4d •1 4" uttef aud -Kau*, *s ka tat kada 1.1sz c lad ablz r I IT I In !tut. " 7, I .rd, %km. DKR d womb at ,p ex kb tptlikl knit, !•.,r td 4. t....Aob-40". g ti:Mt Plibir • taxa". Itre 1.ardva 4;4.. Stbribbk 10 urb 14. 4.44:: .4,14:41 15J 1=4 41 I:1 I:- 'Si 1,4 ties .1c3 It 4114a I, ac be-kalr •fl-p. a• 'nu.. k• tlut.oub 7na,rit atk., aid w kVA M.1.7111,9 Nue ki bad taa, b.: b, „4„b►a—raoty• btu. unt kw rasa t......arrr. IN4s *a .M mg,' al ,,,nat 444 tattud lei kid Kbtu •Lik ay ;did II pild4Pikt t.u. .4IP(c ba,tatudbeli LI 1< W rn,s1,14.ur u■ ink um.= r*Sti at ram hu•-•••A as 4.44.471 Nt4fRa. k rel4t, ty nye eve 4s4 Ihe 144....,2, l•n•tObili ie Le a tie Lua. dut„ 4re toi ls ate -vol. I to ".14144.■ uKr.bst k I but par• attic nor ItZsek. lb baud avid, I tau ttluaT rubonrukcIP I a• ,04.-,t.upi alk, • -• 131411 191.7..d air4L :irk aid. FAL4 Is web katridati. If , diatikautales u4sar-tur dd. auk, it wall L. idala. tad titu7 buuitk, h Lai .47 etrrrtunots ur d rm7 Ttu-Icr, Its trirratnx1 at tit ritkubb, ulua,uar 1.41...a:. alb mg la is a+. as". Lima Jr, d tiu aur•a ktitrnkri Ito Tc with. H. al.:sail:a masa, a weir 41s.. 441,4 4.444 44 .4'.-U eve -mini Imps-14A as 'nary f ‘4 ,, 1,4 IS CM, totica... rrnautr a tat rtk stoke •ci db. or 44 Vbirty =• kali.. a Adam. 1 .-4115,1 6.4141in: A.U.1.4.t .4 iw..a ksilti tax fabrd amailultakfnut ktmittl *,r 'i,,1 rH itie. •Lai id" UAL kb. itkida-tilf, Et, } ,,.c •n-dna tame:, array. Oda r”atib7 Ca' N44# rclxisibabis Az a...a •,x fa, imer4.1 .14 MiL.Vet Etbdt ote beliptd ikr i.:03nosr•■•••■ v-41 p4,11.1: zaLut kkxrbacty tt lb Tiaua,s, It, Tram". ra 14 /vials 4.644,.1 1,1 ISrJildk•t tart, 4, ,uttrttl •ttasf. WIlekLLLdd kttptti If " °A. Al.' 14. 1 110 Ler-ts■ rtiaat sHit dag ..aLaiaataar. rtntrry :twat tkibbattabliiak LE k 14-a•-•.% '` 49....4. 14 IV 4144 34:5, lir Labatt 414444.1a, La ”15 lint:.-r..+.4 ws or 41,, rIx tf loft, 4a1l 4. ribbut. viaa ida.a.takta- tki Tuuu,:y ik'btct utkikdi.11, r ve.cmc taut it. Ltda.! ub: a. rabaktutti, :Tutu.a6,1a.aota. • ft. ■•■•ti, u3-.ta .5t, 1i Ario,Acr, notes were specie-convertible, all other non-con- vertible money would naturally be discounted. It was also true that premiums were paid for U.S. notes in terms of depreciated bank notes, while the Treasury notes were at a discount for specie. There is also substantial evidence that the small Treasury notes circulated as currency. The Niles Register of June 24, 1815 reported: Treasury Notes. This species of money, so conve- nient as a general circulating medium, is above par at Philadelphia and in all parts of the south- ward and westward-nearly at par In New York, and rapidly rising in Boston. . . . It is probable that Treasury Notes will immedi- ately become the circulating medium of all the Union; and, perhaps, sound policy may dictate the issue of a large number of small amounts, like bank notes, without interest, as well as to supply the general demand . . . 72 In a directive on August 15, 1815, the Treasury Secretary mentions that the circulating medium for local use at that time was cents, Treasury notes and local bank notes. 73 A Boston paper reported a notice by Treasury Secretary Dallas on December 23, 1815, that because of the suspension of specie payments there was no hard money in the Boston loan office to payoff its debts; there were only Treasury notes which were the "major circulating medium now and the way people pay taxes and duties." 74 In his own December, 1815 report, Dallas submitted a table showing $1,365,000 in small treasury notes being sold at a premium of from 2- 1/2 to 4 percent, a high premium to pay for non- A letter dated July 29, 1815, from Secretary of the Treasury, Alexander J. Dallas to the Cashier of the Branch Bank of Pittsburgh, 'requesting that any Treasury notes be turned back in to the Treasury. 'P.4 ClaraN rlit• ∎ -• :r r trAtzl auaor ir•rr interest bearing notes convertible into 7 percent stock when other certificates, such as treasury loan certificates, were available at an effective rate of 27 percent. 75 A logical explanation is that these small Treasury notes were valuable as a circulating medium throughout the country; that faith was rising in government bonds; and that funds were needed for customs. Breen asserted that by October 1, 1815, $3,218,950 worth of notes (95% of the notes issued) were exchanged for stock. 76 He concludes from these figures that the notes did not circulate but were immediately funded. But Breen's figures are incorrect. By October 1, 1815 a total of $2,282,850 of n $1,860,000 were paid in for duties and taxes or used in TN-15 $15 Unsigned remainder, cross cut cancelled. Spread Eagle with shield at upper right. (Hessler X-838) otes were issued and only funding. From these figures we realize not only that 81 percent of the small Treasury notes were used for paying taxes or used in funding, but that the notes served a currency purpose by being tax receivable. Furthermore, of the origi- nal $2,282,850 in Treasury notes, more than $1.3 mil- lion went to pay for war supplies and another $645,000 were turned over to pay the dividends on the public debt. The remain- ing $335,000 was actually ,ItalITZD vroullmt to rv,e1 ,,c Otis Note toy '111111a., -1)01A,MLI.S io all vaymoutA to them.. ot. to fund the unwunt ut seven percent. itttereM,Cifl request: atteetti)1; to %Ile act of Cou;cressi of Vet). COUNTERSIGNED TN-16 $3 Unsigned 5ntitr ____111111111111111111 remainder. Shield with motto in upper center. Cuite4 Sow. PAPER MONEY • September/October 2005 • Whole No. 239 sold at premiums of I-1/4 to 4 percent (presumably vis-à-vis depreciated bank notes). 77 It is certainly more plausible that most of these notes circulated, were used as back reserves, or were turned in for taxes, rather than funded at 7 percent as Breen believed. It is doubtful that the non-interest bearing small Treasury notes saw much use as bank reserves either. Individuals would deposit the notes or merchants would use them to pay customs duties. The banks would sometimes use the Treasury notes as cash reserves to pre- vent their own notes from being discounted. Thus the small Treasury notes would again be recycled into the community, acting just as planned—a circulating substi- tute to specie. Despite the usefulness of the Treasury notes, Secretary Dallas still viewed them as an embarrassment to the fiscal operations of the government, made neces- sary by the extraordinary expenses of war. In his December 1816 report the Secretary recommended that since temporary loans could be obtained from the newly chartered Second Bank of the United States, "the reissue of Treasury Notes, of all description, should be discontinued." He therefore suggested that "an appro- priation be made during the present session of Congress for the reimbursement of the whole of the Treasury notes issued under the act of the February 24, 1815. The Treasury notes issued under the preceding laws have either been reimbursed, or provisions made for that object during the last quarter of the year." 78 Again, following the Secretary's recommendations, Congress passed an act on March 3, 1817, repealing all pre- ////;if./ vious Treasury note acts and prohibit- ing further issue of notes. This law remained in effect for almost 20 years, 11/24 during which time the legal circulating medium consisted of Spanish and Mexican dollars, occasionally other foreign silver, and notes of the Second Bank of the United States. 79 Thus caeplisirm, g Treasury notes; one necessitated Trestur, ended the first experiment with circu latin - (like most currency issues throughout 339 Aulf 1/y(* ) lt,itftlsta / ,,////1/:///e /// -it. li*: mULED SKEL‘TJU6 promise to ehe this Note Cur ITIVLIVX. 'VOA X.XIIA in tali lan)ntento to them: tuna the noon% nt selien per a Ot. interest, on retlitet: tatreenlAN the net of CAMV'eVAS of Feb. 2.-1, history) by a currency-hungry war. The introduction of these first Treasury notes caused an expansion of TN-16b(1) $3 Fully signed remainder. Shield with motto in upper center. The only known uncancelled circulating Treasury note sold. the money supply and a corresponding rise in prices by acting as bank reserves. Their utility as legal tender issues however, prevented their massive depreciation as was the case for some of the earlier Colonial issues, the Continental notes of the American Revolution, and later Union and Confederate Civil War notes. Not only were the Treasury notes our Nation's first circulating currency, but also it's most successful. An Act Declaring War Between the United Kingdom of Great Britain and Ireland and the Dependencies Thereof and the United States of America and Their Territories. Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That war be and the same is hereby declared to exist . . .and that the President of the United States is hereby authorized to use the whole land and naval force of the United States to carry the same into effect . .." APPROVED, June 18, 1812 Want more details on this interesting period of U.S. history? You may want to read the best selling book by historian Walter Borneman (HarperCollins, 2004). AITED R. I Sou s ust.sr, 340 September/October 2005 • Whole No. 239 • PAPER MONEY Appendices Treasury Note Types: Virtually all 1812-1815 Treasury notes issued were redeemed by the government and destroyed. Less than 150 notes (assuming existing uncut sheets were cut into single notes) of four basic types are known today. These include unsigned remainders, partially signed remainders, fully signed notes and proofs. About two dozen cardboard proof specimens of the last two issues are known to have survived over the last 200 years. Presumably this number represents most of those printed, as specimen notes were likely hoarded by collec- tors. It is believed that most were supplied to the chief cus- tom houses and other receivers of public funds in Baltimore, Boston, Charleston, New York and Philadelphia. 80 All known proofs are punched cancelled by printers Murray, Draper, Fairman & Co. with either two or three holes equally spaced above each three signature lines for a total of nine holes on the $20 and $100 notes of the December 26, 1814 issues and the $100 notes of February 24, 1815; eight holes on the $5 and $50 denominations of the February 14, 1815 issues, and six holes on the $10 notes. No proofs are known of the $3 or $20 denominations of the small Treasury notes. Unsigned remainders or unissued notes are known for almost all the series. These specimens were printed but never issued and eventually entered the collecting market. About a quarter of all Treasury notes are unsigned remain- ders. Partially signed notes are either singly or doubly signed. One cut sheet of four $50 notes is singly signed by Edward Fox. Usually these and double signed notes without coun- tersignatures were sent to banks and other government institutions for comparison purposes to detect counterfeits. These doubly signed notes are either by the duo of Edward Fox and Samuel Clarke, or F.W. McGeary and Clement C. Biddle. Fully signed notes with the countersignature are scarce and all but two are $50 denominations from the fifth series small Treasury notes. Of the approximately 12 known, all are punched hole cancelled. The two known (and one unconfirmed) non-cancelled fully signed notes consists of a $3 note countersigned by Joseph Nourse and a $10 note countersigned by James Dickson (this note is illustrated in Knox, but has never appeared for sale). Major Treasury Note Collections: Only four major collections of Treasury notes have been sold this millennium, but together they contained almost half the known notes. The Alexandre Vattemare Collection (R.M. Smythe 6/00) contained 17 notes includ- ing a few unique cardboard proof sheets. John Jay Ford (Stacks 10/04) acquired over 40 notes mostly from the F.C.C. Boyd and Julian Blanchard collections. The Donald H. Kagin collection accumulated over 30 years was sold privately to the "Taylor Family" (Currency Auctions of America 2/05) and contained 16 notes and ancillary bonds and contemporary articles. A fourth collection, the Jim O'Neil Sale (Currency Auction of America 5/05) was com- prised from notes from the other three sales. Less than 35 specimens are known for the first four interest bearing issues combined (including uncut sheets and speci- mens). The balance of more than 110 notes is from the cir- culating small Treasury notes. Following are tables con- taining information about Treasury notes and loan provi- sions associated with the War of 1812. Authorized TABLE 1— War of 1812 Notes (Amounts in millions of dollars) Amount Authorized Rate Retroactive Discount Issue Date Amount Sold Rate Sold Clause March 14, 1812 11.0 11.0 6% Par No February 8, 1813 16.0 16.0 6% 88-1/3% No August 2, 1813 7.5 7.5 6% 88-1/4% No March 24, 1814 25.0 16.0 6% 85% Yes November 15, 1814 3.0 1.5 No Limit Special Contract Yes December 26, 1814 10.0 Yes February 24, 1815 15.0 7% 95% Yes March 3, 1815 18.46 Yes Source: Rafael A. Bayley, National Loans of the United States from July 14, 1776 to June 30, 1880 (Washington, D.C., 1882). Issue Date June 30, 1812 February 25, 1813 March 4, 1814 December 26, 1814 Febniary 24, 1815 TOTAL: TABLE 2 — Amount of Treasury Notes Issued (Amounts in dollars) Amount Issued 5,000,000 5,000,000 10,000,000 8,318,400 4,969,400 Large Notes 3,392,994 Small Notes $36,680,794 Source: "Domestic Letter, 1814-1816," Vol. I, Record Group 53, National Archives (Washington, D.C.). MYLAR D® CURRENCY HOLDERS PRICED AS FOLLOWS BANK NOTE AND CHECK HOLDERS SIZE INCHES 50 100 500 1000 Fractional 4-3/4" x 2-1/4" $20.50 $37.00 $165.00 $290.00 Colonial 5-1/2" x 3-1/16" $21.00 $38.50 $175.00 $320.00 Small Currency 6-5/8" x 2-7/8" $21.50 $41.00 $182.00 $340.00 Large Currency 7-7/8" x 3-1/2" $24.00 $45.00 $200.00 $375.00 Auction 9 x 3-3/4" $26.50 $48.00 $235.00 $410.00 Foreign Currency 8 x 5 $30.00 $55.00 $250.00 $440.00 Checks 9-5/8 x 4-1/4" $30.00 $55.00 $250.00 $440.00 SHEET HOLDERS SIZE INCHES 10 50 100 250 Obsolete Sheet End Open 8 3/4" x 14 1 /2' $18.00 $80.00 $140.00 $325.00 National Sheet Side Open 8 I/2 " x 17 1 /2" $19.00 $85.00 $150.00 $345.00 Stock Certificate End Open 91/2" x 12 1/2' $17.50 $75.00 $135.00 $315.00 Map & Bond Size End Open 18" x 24" $70.00 $315.00 $570.00 $1295.00 You may assort note holders for best price (min. 50 pcs. one size). You may assort sheet holders for best price (min. 5 pcs. one size) (min. 10 pcs. total). SHIPPING IN THE U.S. (PARCEL POST) FREE OF CHARGE Mylar D° is a Registered Trademark of the Dupont Corporation. This also applies to uncoated archival quality Mylar Type D by the Dupont Corp. or the equivalent material by ICI Industries Corp. Mel inex Type 516. DEN LY'S OF BOSTON P.O. Box 51010, Boston, MA 02205 • 617-482-8477 ORDERS ONLY: 800-111-DENLY • FAX 617-357-8163 341 WANTED: NATIONAL BANK NOTES Buying and Selling Nationals from all states. Price lists are not available. Please send your want list. Paying collector prices for better California notes! WILLIAM LITT P.O. BOX 6778 San Mateo, California 94403 (650) 458-8842 Fax: (650) 458-8843 E-mail: BillLitt@aol.com Member SPMC, PCDA, ANA PAPER MONEY • September/October 2005 • Whole No. 239 Announcing the Confederate Paper Money Condition Census Project •Building a census and provenance of the top CSA currency rare varieties. •Updates to be published as supple- ments to new Collecting Confederate Paper Money book by Pierre Fricke. •Do you want to be remembered 100 years from now by future collectors? •Privacy and anonymity maintained at your request. Long time rarity and variety collector (32 years) - U.S. Large Cents, Bust Halves, now CSA paper money and bonds. Member EAC, JRCS, SPMC. From long time Louisiana family. Please write to - Pierre Fricke, P.O. Box 245, Rye, NY 10580 pfricke@attglobal.net ; www.csaquotes.com ; eBay - "armynova" I Collect FLORIDA Obsolete Currency National Currency State & Territorial Issues Scrip Bonds Ron Benice 4452 Deer Trail Blvd. Sarasota, FL 34238 941 927 8765 Benice@Prodigy.net 342 September/October 2005 • Whole No. 239 • PAPER MONEY TABLE 3 — Treasury Notes Outstanding as of January (Amounts in dollars) Issue Date Amount Outstanding 1813 2,835,500 1814 4,907,300 1815 10,646,480 1816 17,619,625 1817 3,450,000 Source: "Domestic Letter, 1814 - 1816," Vol. I, Record Group 53, National Archives (Washington, D.C.). TABLE 4 — Treasury Note Bill Provisions Issued Date Authorized Emission Amount Sold Where Issued June 30, 1812 $5,000,000 $5,000,000 Boston, New York, Baltimore Philadelphia, Washington, DC February 25, 1813 $5,000,000 $5,000,000 March 4, 1814 $5,000,000 & $5,000,000* $10,000,000 Boston, New York, Philadelphia (*As part of any loan act of that session) Washington, DC, Richmond, Charleston, Savannah December 26, 1814 $7,500,000 $8,318,400 (As part of loans of 3/24 & 11/15 & $3,000,000) February 24, 1815 $25,000,000 Large $4,969,400 Small $3,392,994 + Reissue $9,070,386 Note: The large Treasury notes were 7-3/8 by 3-7/8 inches. They were printed on blue and red silk-fibered, watermarked paper by MURRAY, DRAPER, FAIRMAN & CO. Source: "Domestic Letter, 1814-1816," Vol. I, Record Group 53, National Archives (Washington, D.C.). TABLE 5— Amount of Treasury Notes Sold & Redeemed Amount Issue Date Issued Amount Redeemed 1812 $2,835,500 1813 $6,094,500 1814 $8,297,280 $5,800,000 1815 $12,200,000 $2,700,000 1816 $4,300,000 $9,700,000 Source: Alexander J. Dallas, "Report of the Secretary of Treasury, 1815" Reports of the Secretary of the Treasury of the United States (Washington, D.C., 1837), Vol. I, p. 15. TABLE 6 — List of Small Treasury Notes Sold Percent Premium Amount Amount of Premium 4 $ 300,000 $12,000.00 3-1/4 $ 19,600 $ 637.00 3 $ 89,400 $ 2,682.00 2-3/4 $ 55,000 $ 1,512.50 2-1/2 $ 281,000 $ 7,025.00 2-1/4 $ 5,000 $ 112.50 2 $ 340,000 $ 6,800.00 1-3/4 $ 10,000 $ 175.00 1-1/2 $ 91,000 $ 1,365.00 1-1/4$ 74,000 $ 925.00 1-1/4 (With one month interest deducted) $ 100,000 $ 659.37 $1,365,00 $33,893,37 Deduct sundry charges incurred: $ -1,785.73 Net amount of premium received by the United States: $32,107.64 Source: "Domestic Letter, 1814-1816," Vol. I, Record Group 53, National Archives (Washington, D.C.). PAPER MONEY • September/October 2005 • Whole No. 239 343 TABLE 7 — Major Foreign Loans to the U.S . (1782-1812) (Amounts in dollars) Year Where From Amount Interest Rate 1787 Holland 10,000,000 6% 1789 France 18,000,000 (Livre) 5% 1790 Holland 1,200,000 5% 1791 Holland 1,000,000 5% 1791 Holland 2,400,000 5% 1791 Holland 1,200,000 5.5% 1793 Holland 5,000,000 (Guilders) 5% 1794 Holland 1,200,000 5% Source: "Laws Concerning Money, Banking and Loans 1778-1909," National Monetary Commission, compiled by A.T. Huntington and Robert H. Mawhinney, (Washington, D.C., Government Printing Office, 1910). TABLE 8 — Temporary Bridge Loans (1789-1812) (Amounts in dollars) Year Where From Amount Purpose 1789 Bank of New York 170,000 Troop Salaries 1790 Bank of New York 100,000 Troop Salaries 1790 Stock @ 6%, 3% & Deferred 6% Indefinite Fund Debt 1792 Bank of the United States 400,000 General Expenses 1793 Bank of the United States 800,000@5% General Expenses 1793 Bank of New York 200,000@5% Algerian War 1794 Bank of the United States 1,000,000@5% Algerian War 1794 Bank of the United States 1,000,000@5% Public Expenditures 1795 Bank of the United States 2,000,000@5% General Commerce 1795 Bank of the United States 1,500,000@6% Public Debt 1795 Bank of the United States 200,000@6% Public Debt 1795 Stock @ 4-1/4 & 5-1/2% Indefinite Pay Foreign Debt 1796 Bank of New York 320,000@6% Pay Bank of U.S. 1796 Bank of New York 5,000,000@6% Pay Bank of U.S. 1797 Bank of New York 717,000 War 1800 Bank of the United States 1,500,000@8% War 1803 Bank of New York 11,250,000 Louisiana Purchase 1803 Bank of the United States 1,750,000 Louisiana Purchase 1804 Bank of the United States 1,000,000 Pay Barbary Pirates 1807 Converted old 3% & 6% Stock 8,500,000 Public Debt 1810 Bank of the United States 2,750,000 General Expenditures Source: Laws, op cit. TABLE 9 — War of 1812 Loans (Amounts in dollars) Issue Date Authorized Amount Authorized Rate Retroactive Discount Amount Sold Rate Sold Clause March 14, 1812 11,000,000 11,000,000 6% Par No February 8, 1813 16,000,000 16,000,000 6% 88-1/3% No August 2, 1813 7,500,000 7,500,000 6% 88-1/4% No March 24, 1814 25,000,000 21,000,000* 6% 85% Yes November 15, 1814 3,000,000 1,500,000 No Limit Special Contract Yes December 26, 1814 10,500,000 Yes February 24, 1815 15,000,000 7% March 3, 1815 18,460,000 95% Yes *Includes $5 million in Treasury notes. Source: Rafael A. Bayley, "National Loans of the United States from July 14, 1776 to June 30, 1880" (Washington, D.C.. Government Printing Office, 1882). 344 2005 • Whole 239September/October No. • PAPER MONEY TABLE 10 - Subscription of $16 Million Loan of February 8, 1813 (Amounts in dollars) Name Amount States East of New York 486,700 State of New York 5,720,000 Philadelphia 6,858,400 Baltimore & the District of Columbia 1,393,300 Virginia 187,000 Charleston, South Carolina 354,000 Source: Davis Rich Dewey, "National Financial History of the United States" (New York, Augustus M. Kelley, 1968). TABLE 11 -Treasury Note Issues of March 4, 1814 (By issue Date and Loan Office) Date of Issue Boston New York Philadelphia Baltimore Washington Richmond Charleston Savannah Total 1814 March 11 ---- 150,000 ---- ---- ---- ---- ---- --- 150,000 April 1 ---- ---- ---- ---- ---- ---- ---- 211,000 211,000 April 11 ---- ---- ---- ---- 56,000 ---- --- 56,000 April 21 ---- 125,000 5,500 ---- 144,000 ---- --- 274,500 May 1 ---- 1,000 ---- 50,000 ---- ---- 75,000 126,000 May 11 ---- 74,700 145,000 ---- ---- --- 219,700 May 21 ---- ---- 29,500 ---- 100,000 ---- --- 129,500 June 1 ---- ---- 6,200 100,000 - - 106,200 June 11 ---- ---- 24,500 ---- 25,000 ---- 49,500 June 21 ---- 25,000 23,000 ---- 25,000 ---- --- 73,000 July 1 ---- 149,700 105,400 ---- ---- --- 255,100 July 11 ---- 75,000 29,000 ---- - 104,000 July 21 ---- ---- 12,700 ---- 45,000 ---- --- 57,700 Aug. 1 92,000 60,000 510,000 40,000 17,800 719,800 Aug. 11 ---- 90,000 94,200 ---- 20,000 ---- 150,000 354,200 Aug. 21 ---- ---- - ---- 2,500 2,500 Sept. 1 ---- - 1,600 ---- ---- --- 1,600 Sept. 11 ---- ---- - ---- 10,000 --- 10,000 Sept. 21 ---- 40,000 ---- ---- 60,000 --- 100,000 Oct. 11 ---- 25,000 11,820 ---- 500,000 536,820 Oct. 21 52,000 238,000 105,000 100,000 1,000 --- 496,000 Nov. 1 150,000 200,000 100,000 ---- 27,700 --- 477,700 Nov. 11 ---- ---- 130,000 ---- 15,000 --- 145,000 Nov. 21 12,000 310,280 254,600 5,000 21,700 --- 603,580 Dec. 1 ---- 853,420 174,060 60,000 14,900 ---- 1,102,380 Dec. 11 3,000 50,000 4,060 ---- 11,100 --- 68,160 Dec. 21 300 23,160 68,000 ---- 31,180 15,000 137,640 1815 Jan. 1 ---- 387,000 222,240 ---- 50,460 659,700 Jan. 11 50,000 440,900 81,200 ---- 34,620 606,720 Jan. 21 138,160 34,900 ---- 65,900 238,960 Feb. 1 420,420 1,196,280 11,000 5,100 1,632,800 Feb. 11 79,200 45,900 125,100 Feb. 21 ---- 18,400 18,400 March 1 25,600 1,200 82,540 109,340 March 11 400 15,000 15,400 March 21 11,900 ---- 11,900 April 1 8,900 ---- 8,900 April 11 ---- 2,200 2,200 April 21 ---- 2,000 2,000 June 21 1,000 1,000 TOTAL 359,300 3,901,340 3,472,360 316,000 1,500,000 15,000 150,000 286,000 10,000,000 Source: A. J. Dallas, "Report of the Secretary of the Treasury, 1814 and 1815," Reports of the Secretary of the Treasury of the United States, (Washington: Blair and Rives, 1837) Vol. I, p. 542; Vol. 2, p. 62. PAPER MONEY • September/October 2005 • Whole No. 239 345 TABLE 12 — Treasury Note Signers Issue Date Loan Office Denominations Signatures Countersignatures June 30, 1812 Philadelphia All Timothy Matlock &Charles Biddle William White (Commissioner of Loans) (Commissioner of Loans) William White (Commissioner of Loans) T.D.T. Tucker (Commissioner of Loans) T.D.T. Tucker (Commissioner of Loans) March 25, 1813 Philadelphia All William WhiteTimothy Matlock & Samual Clarke March 4, 1814 Philadelphia All Edward Fox &Samual Clarke December 26, 1814 Philadelphia $100 & $20 Edward Fox &Samual Clarke Philadelphia $20 Notes Only F.W. McGeary &C.C. Biddle February 24, 1815 Philadelphia Large Notes Edward Fox &Samual Clarke Joseph Nourse (Register of the Treasury) Philadelphia Small Notes Edward Fox & Samual Clarke also F.W. McGeary & C.C. Biddle Joseph Nourse (Register of the Treasury) also James Dickson (Register of the Treasury) Source: "Register of Treasury Notes," Vol. 189, Record Group 53, National Archives, Washington, DC; "Estimates and Statements 1791-1843," Vol. 132, Record Group 53, National Archives, Washington, DC, and personal observations by the author. Table 13 -- Treasury Notes Concordance Friedberg # Krause # Hessler # TN-1 P-2 TN-2 P-1 X-69 TN-3 TN-4 P-3 X-72 TN-5 TN-6a P-6 X-74C TN-7 P-4 X-74A TN-8 TN-8a P-9 X-80C TN-8p PP-9 TN-9 TN-9a P-7 X-80A TN-9p PP-7 TN-10 TN-10a TN-10p PP-16 X-85 TN-11 TN-1 1 a TN-1 lb P-15 X-83E TN-11p PP-15 TN-l2 P-14 X-83D TN-12a TN-12p TN-13 TN- I 3a P-12 TN-14 TN-14a P-13 X-83C TN-14b TN-14p PP-13 TN-15 P-11 X-83B TN-15a TN-15p PP-11 TN-16 P-10 TN-16a X-83A TN-16b TN-16p 346 September/October 2005 • Whole No. 239 • PAPER MONEY TABLE 14 — Treasury Notes Outstandin Issue Date Official Redemption Date Last Payment Amount Outstanding .. Known Notes* June 30, 1812 12/31/1814 9/20/1820 100 $1,000 A; unsigned remainder (3) $100 A; unsigned remainder (2) $100 B; unsigned remainder (2) $100 D; unsigned remainder February 25, 1813 3/31/1815 12/26/1820 900 None March 4, 1814 6/21/1816 1837 43,160 $100 C; dated 1/15/15; double signed remainder (2) $100 D; dated 1/15/15; double signed remainder (2) December 26, 1814 9/1/1816 9/30/1841 41,030 $100 A; signed Samuel Aiken and Everate, no countersignature $100 A; dated 2/11/1815, unsigned remainder $100 A; undated, double signed remainder $100 B; unsigned remainder, hole cancelled $100 B; punched cancelled proof $100 C; double signed remainder $100 D; punched cancelled proof $100 D; undated, punched cancelled $100 D; double signed remainder $20 A; punched cancelled proof (2) $20 A; double signed remainder McGeary & Biddle (4) $20 B; double signed remainder McGeary & Biddle (2) $20 B; punched cancelled proof (2) $20 E; unsigned remainder $20 E; double signed remainder Clarke & Fox $20E/F; double signed remainder Clarke & Fox, uncut pair $20 H; double signed remainder McGeary & Biddle (2) February 24, 1815 Large Notes** 1/1/1842 $100 A; unsigned remainder (2) $100 B; unsigned remainder (2) $100 C; unsigned remainder (2) $100 A,B,C; punched cancelled proof sheet of 3 February 24, 1815 Small Notes*** 3/31/1842 2,061 $50 A; fully signed McGeary & Biddle and countersignature Nourse, hole cancelled (10) $50 A; singly signed Clarke $50 B; singly signed Clarke $50 C; singly signed Clarke $50 D; singly signed Clarke $50 A,B,C; punched cancelled proof sheet of 3 $20 A; unsigned remainder (2) $20 B; unsigned remainder (2) $20 B; incomplete proof with 9 holes, no denomination at left edge $20 C; unsigned remainder (2) $20 D; unsigned remainder $20 D; proof with 9 holes $20 E; proof with 9 holes $10 Type I A-D (text printed at right) $10 A; double signed remainder McGeary & Biddle (2) $10 B; double signed remainder McGeary & Biddle $10 C; double signed remainder McGeary & Biddle $10 D; double signed remainder McGeary & Biddle PAPER MONEY • September/October 2005 • Whole No. 239 347 TREASURY NOTES OUTSTANDING (continued) Issue Date Official Redemption Date Last Payment Amount Outstanding Known Notes* February 24, 1815 $10 Type II E-H (no text printed at right) Small Notes*** $10 E; double signed remainder Clarke & Fox (4) (Continued) $10 E,F,G; punched hole cancelled proof sheet of 3 $10 F; double signed remainder Clarke & Fox (6) $10 F,G,H; double signed remainder Clarke & Fox, uncut sheet of 3 $10 G; unsigned remainder $10 G; double signed remainder Clarke & Fox (4) $10 G/H; double signed Clark & Fox, uncut pair $10 H; unsigned remainder $10 H; double signed Clarke & Fox (5) $10 H; double signed Clarke & Fox, countersignature "John C. Calhoun" (suspect) $10 H; fully signed Clarke & Fox, countersignature James Dickson, dated 3/25/15, uncancelled $5 A; unsigned remainder $5 B; unsigned remainder (2) $5 B,C,D; double signed McGeary & Biddle, uncut strip of 3 (2) $5 C; unsigned remainder $5 D; unsigned remainder (4) $5 E; unsigned remainder proof, punched cancelled $5 uncut pair Ex: ANA '52 $5 B,C,D; uncut strip of three remainders, cross cancelled $5 F,G,H; uncut sheet of three unsigned remainders proof, punched cancelled $3 A; fully signed McGeary & Biddle, uncancelled (REPORTED) $3 A; unsigned remainder (2) $3 A; double signed remainder McGeary & Biddle $3 A,B,C,D; unsigned remainders, uncut sheet of 4 $3 B; unsigned remainder $3 B; double signed remainder McGeary & Biddle $3 C; unsigned remainder $3 D; unsigned remainder (2) $3 D; double signed remainder McGeary & Biddle (2) $3 D; fully signed McGeary & Biddle, countersignature Joseph Nourse, uncancelled * All but two known notes are either Proofs, lack countersignatures, or are cancelled ** All known Large size notes of the 2/24/1815 issue are dated 2/24/1815 *** All known Small Size notes of the 2/24/1815 issue are dated 3/25/1815 Issue Date: December 26, 1814 Denomination TN# Known Value VF Value New $100 Unsigned remainder 8 1 $20,000 $25,000 $100 Double signature remainder & cancelled 8a 3 $12,500 $17,500 $100 Proof, holed cancelled 8p 2 $12,500 $17,500 $20 Unsigned remainder 9 1 $8,000 $12,500 $20 Double signature remainder 9a 11 $8,000 $12,500 $20 Proof, holed cancelled 9p 4 $7,000 $10,000 TN# Known Value VF Value NewDenomination $30,000 $25,000 3 $20,000 5 $15,000 $1,000 Unsigned $100 Unsigned 1 2 TN# Known Value VF Value NewDenomination $1,000 3 0 $100 4 0 TN# Known Value VF Value NewDenomination $1,000 $100 $200 5 0 6a 4 $20,000 $30,000 7 0 Double signature remainder Issue Date: March 4, 1814 Issue Date: June 30, 1812 Issue Date: February 25, 1813 348 September/October 2005 • Whole No. 239 • PAPER MONEY TABLE 15 -Treasury Note Populations & Values* Denomination Issue Date: Februar 24, 1815 TN# Known Value VF Value New $100 Unsigned remainder 10 6 $8,000 $12,500 $100 Double signature remainder 10a 0 $100 Proof, holed cancelled 10p 4 $8,000 $12,500 $50 Unsigned remainder 11 0 $50 Singly signed remainder 11a 4 $7,000 $10,000 $50 Fully signed & cancelled 1 lb 10 $6,000 $9,000 $50 Proof, holed cancelled 11p 3 $8,000 $12,500 $20 Unsigned remainder 12 7 $6,500 $10,000 $20 Double signature remainder 12a 0 $20 Proof, holed cancelled 12p 3 $7,000 $10,000 $10 text at right Unsigned remainder 13 0 $10 text at right Double signature remainder 13a 5 $7,000 $10,000 $10 no text at right Unsigned remainder 14 2 $6,000 $9,000 $10 no text at right Double signature remainder 14a 26 $5,000 $7,500 $10 No text at right, fully signed, uncancelled 14b 1 $85,000 -- $10 no text at right Proof, holed cancelled 14p 3 $7,000 $11,500 $5 Unsigned remainder 15 13 $5,000 $7,500 $5 Double signature remainder 15a 6 $7,000 $12,500 $5 Proof, holed cancelled 15p 4 $8,000 $15,000 $3 Unsigned remainder 16 10 $5,500 $8,000 $3 Double signature remainder 16a 4 $7,000 $11,500 $3 Fully signed & uncancelled 16b 1 $85,000 $3 Proof 16p 0 "Numbers are based on the upcoming 18th edition of Paper Money of the United States, Arthur L. and Ira S. Friedberg, the Coin & Currency Institute. "a " designations denote partially signed remainder; "b" fully signed notes; and "p" proofs. No designation denotes unsigned remainders. PAPER MONEY • September/October 2005 • Whole No. 239 349 Endnotes Laos of the United States Concerning Money, Banking, Loans. 1778-1909, National Monetary Commission, compiled by Andrew T. Huntington and Robert J. Mawhinney, Doc. No. 480, Senate -61st Congress, 2nd Session (Washington, D.C., 1910). pp. 29-43. 2Albert Gallatin, "Report of the Finances 1807," Reports of the Secretary of the Treasury of the United States, Vol. I (Washington, D.C., 1837). p. 359, and A. J. Dallas, "Report of the Finances 1815." Reports, 2:45. 3Foreign coins officially circulated from 1793 until 1797, when a new law declared that only "Spanish milled dollars and parts thereof were legal tender. This statute remained in effect until 1857. 4Alexander Balinky, Albert Gallatin, Fiscal Theories and Policies (New Brunswick, 1958), .pp. 180-88 and Albert Gallatin, "Report of the Finances 1809," Reports, p. 401. Also see "Report of the Finances 1811," Reports, p. 449. 5Ident.. "Report of the' Secretary of the Treasury, 1811," Reports, p. 449. Also in the Niles Weekly Register, November 22, 1811 (Washington, D.C.), 2:232. In a letter to the Chairman of the House Ways and Means Committee, Ezekiel Bacon, Gallatin blames the poor state of the finance on the failure of Congress to recharter the Bank of the United States, upon which he had relied heavily for the U.S. government to obtain loans, and also for the Legislature's refusal to double the tariff. Albert Gallatin, "Letter to Ezekiel Bacon, January 10, 1812," The Writings of Albert Gallatin. ed. Henry Adams, Vol. 1 (New York, 1960), pp. 338-40. 6 Ibid. p. 448. 7Albert Gallatin, The Writings of Albert Gallatin, ed. Henry Adams, 4 Vols. (Philadelphia, 1879), Vol. III, p. 5. 8Ezekiel Bacon, "Ways and Means Report of House, February 17, 1812," American State Papers. Finance, U.S. Congress, ed. Walter Lowrie, Vol. II (Washington, D.C., 1832), p. 539. 9Rafael A. Bayley, National Loans of the United States from July 14, 1776 to June 30, 1880 (Washington, D.C., 1882), p. 48, and Henry Carter Adam, Public Debts: All Essay in the Science of Finance (New York; Privately printed, 1887), pp. 117-18. "Albert Gallatin, "Letter to John W. Eppes, February 25, 1810," Writings, II:' 467- 468. 11 Idem., "Letter to Ezekiel Bacon, January 10, 1812," Writing, U: 501. Also in Letter from the Chairman of the Committee of Ways and Means to the Secretary of the Treasury with the Answer of the Secretary of the Treasury (Alexandria, 1812), p. 14. Rare Book Room, National Archives, Washington, D.C. 12Letter to Langdon Cheves, May 14, 1812, cited by John J. Knox, United States Notes (New York iR4R) n 77 13 The Niles Weekly Register, June 15, 1812, 2:279. 14Annals o/the Congress o/the United States 12th Congress, 1st Session, Vol. r (Washington, D.C., 1853) p. 1495-1510. 15Ibid. Also The Niles Weekly Register, June 13, 1812, 3:300. 161bid PP. 1509-10. I 7Bayley, National Loans, pp. 48-49. Other major elements provided that 1) the notes were signed by persons designated by the President who were paid $1.25 for every note signed, 2) they were countersigned by the Comptroller of Loans for the state for which the notes were made payable, 3) the Secretary of the Treasury was authorized to borrow upon the security of the notes and pay them to the banks which would receive them at par, 4) interest ceased on the day of payment, and 5) strict penalties were imposed for counterfeiting. 18Niles Weekly Register, 3:350. Also see Richmond Inquirer, February 16, 1814, 2:2. The Treasury Reports, however, state that only $2.8 million were subscribed to by 1813. Davis R. Dewey, Financial History of the United States (New York, 1968), p. 137. "Register of Treasury Notes, Vol. 189, Record Group 53, National Archives (Washington, D.C.). Breen erroneously claims March 1813 as the final date of redemption. "Albert Gallatin, "State of Finance, December 1812," Finance, 11:580. 21 Niles Weekly Register (July 4, 1812), 3:300. It should be noted that, as Walter Breen pointed out, the Register had a bias toward Wall Street. Walter Breen, "Promises, Promises," 'Numismatic News Weekly. January 1, 1974. 22A. J. Dallas, "Letter to William Lowndes, November 27, 1814," Reports, 1:244. 23 Ibid. 24Niles Weekly Register (July 4, 1812), 3:300. 25Richard H. Timberlake, Origins of Central Banking in the United States (Cambridge, Massachusetts, 1978). Drawing upon statistical information compiled from J. Van Fenstermaker, A Statistical Sunanaly of the Commercial Banks Incorporated in the United States Prior to /8/9 (Kent, Ohio, 1965), Timberlake con- cluded that "as banks increased their holdings of treasury notes, their own note issues could increase by multiples of the treasury note's obtained. Bank notes were thus used as hand-to-hand currency, and the Treasury notes were used mainly as bank reserves in lieu of specie." 26 "Receipts and Expenditures, from March 4, 1789 to December 15, 1815," Finance, 11:920. 27James Madison, "Fourth Annual Message, November 4, 1812," Compilation of Messages and Pavers of the President's /789-/897, Vol. 1. 28Bayley, National Loons, p. 50. 29Gallatin, Writings, p. 196. "William Jones, "State of Finance, June 1813," Finances, II: 1622-23. 31 Bayley, National Loans, p. 50. 32Albert Gallatin, "Report of the Secretary of the Treasure December 11, 1812." Reports, p. 469. 33 Bayley, National Loans, p. 50. 34W. F. DeKnight, History of the Currency of the Country and the Loans of the United States (Washington, D.C., 1897), p. 47. 35 Message.s . and Papers of the Presidents, pp. 528-30. The direct tax amounted to $3 million and was assessed in 1814. For a useful table on these taxes, see Dewey, Financial History, p. 140. 36Gallatin, Writings. p. 201 37 Estimated expenditures at $43,350,000 and revenue at $16,000,000. William Jones, "State of Finance", Finance, 2:651. 38Bayley, National Loans, p. 52. 39 The Richmond Inquirer (May 7, 1814), 3:2, reported that by May 7, $10 million at 88 percent had been subscribed. In his report on Finances in December 1814, Dallas mentioned that proposals were invited on August 22, 1814 for $6 million at 6 per- cent; of this only $2,823,300 was subscribed; $100,000 at less than 80 percent: $2,213,000 at 80 percent; $510,300 at 80-88 percent. All but the $100,000 were accepted because there was no prospect of better terms and the money was indis- pensable. $410,000 of these contracts was reneged on by the banks. Special contracts for loans with the banks were unsuccessful. "Report on Finances December 1814," Reports, p. 528. "William Jones, "Report of Finance, December, 1813," Reports, p. 502. There is no corroborating evidence that an annual issuance of $5,000,000 was ever authorized. 4 IBayley, National Loans, p. 52. 42 "Estimates and Statements by the Registrar of the Treasury," Vol. 145. General Records from the Central Treasury Records, Records of the Bureau of the Public Debt, Record Group 53, p. 24. 43 1ohn W. Eppes, "Letter to Secretary of the Treasury Dallas, October 14, 1814," Reports, p.234. 44A. J. Dallas, "Letter to John Eppes, October 17, 1814," Reports, pp. 234-36. 451bid., p. 236 and p. 266; also in Niles Weekly Register (Dec. 24, 1814). "Niles Weekly Register (Dec. 24, 1814). 47 Iclem., "Report of the Secretary of the Treasury, November, 1815," Reports, 11: 13. 48Bayley, National Loans, p. 56. 49 lbid., p. 57. "Albert Gallatin, "Letter to Monroe, October 26, 1814," Writings, 1:642. 51 "Report by John W. Eppes, October 10, 1814." in John Jay Knox, United States Notes (New York, 1884), p. 32. 52Niles Weekly Register (Dec. 2, 1814), 8:266. 53A. J. Dallas, "Report on the Finances, December, 1814," Reports, p. 529. 54Annals. 13:3 (Nov. 12. 1814), P. 557. 55 lbid., p. 559. 56Annals, 13:3 (Jan. 7, 1815), p. 1045. Also in the Richmond Inquirer (Jan. 11, 1815), 2:3. 57A. J. Dallas, State of the Treasury Report, (Jan. 21, 1815), pp. 885-888. 58 59A. J. Dallas. "Letter to John Eppes. February 20. 1815." Reports, pp. 273-75. "William H. Crawford, "Report of the Treasurer," Reports. p. 125. The first known transaction in small Treasury notes was $150,000 ordered by Johanthan Smith, Cashier of the Bank of Pennsylvania on June 28, 1815. "Domestic Letters 1814- 1816," Vol. I, Record Group 53, Archives (Washington, D.C.), p. 108. ° Knox, United States Notes, p. 37. 62A. J. Dallas, "Report on the Finances, December, 1815," Reports, pp. 24-25 . 63 1ames Madison, "Veto Message, January 30, 1815," Compilation, Vol. I, p. 556. 64Richmond Examiner (Dec. 31. 1814). 3:2 & 3. 65Report in the Niles Weekly Register. 7:3361. 66Breen, in Numismatic News Weekly, January 15, 1974, p. 34; and Knox, United States Notes. p. 38. Knox makes the additional statement that "after deducting dis- counts and depreciation," the notes were rapidly funded after December 1814. 350 September/October 2005 • Whole No. 239 • PAPER MONEY Bibliography Adams, Henry Carter. Public Debts: An Essay in the Science of Finance, (New York; Privately printed 1887). Annals of the Congress of the United States, 12th Congress, Ist Session, Vol 1. (Washington: Giles and Seaton, 1853). Bacon, Ezekiel. ''Ways and Means Report of House, February 17, 1812," American State Papers, Finance, by Congress, edited by Waiter Lowrie, Vol. 2, (Washington: Giles and Seaton, 1832). "Receipts and Expenditures, from March 4, 1789, to December 15, 1815," American State Papers, Finance. Balinsky, Alexander. Albert Gallatin, Fiscal Theories and Policies (New Rutgers University Press, 1958). Bayley, Rafeal A. National Loans of the United States from July 14, 1776 to June 30, 1880. (Washington: Government Printing Office, 1882). Breen, Walter. "Promises, Promises," Numismatic News Weekly, January 1, 1974. . Numismatic News Weekly, January 15, 1974. Clain-Stefanelli, Elvira & Dr. Vladimir. Chartered for Progress: Two Centuries of American Banking. Acropolis Books, Ltd., 1975. Crawford, William H. "Report of the Treasurer," Reports. "Domestic Letters 1814-1816, Vol. 1, Record Group 53, Archives, Washington, D.C. Dallas, A. J. "Letter to William Lowndes, November 27, 1814," Reports, 1:244. "Letter to John Eppes October 17, 1814," Reports. "Report on the Finances, December, 1814," Reports. "Official Letters, Appendices to Report on Finances October, 1814," Reports. . "Letter to John Eppes, February 20, 1815," Reports. . "Report on the Finances, December, 1815," Reports. . "Report of the Finances 1815," Reports. . "Report of the Finances December, 1816," Reports. DeKnight, W. F. History of the Currency of the Country and the Loans of the United States. Dewey, Davis R. Financial History of The United States, (New York 1968, Augustus M. Kelley). "Domestic Letter 1814-1816," Vol. 1, Record Group 53, National Archives Washington, D.C. Eppes, John W. "Letter to Secretary of the Treasury Dallas, October 14, 1814," Reports. "Estimates and Statements by the Register of the Treasury," Vol. 145. Gallatin, Albert, "Report of the Finances 1807," Reports of the Secretary of the Treasury of the United States, Vol. 1 (Washington: Blair and Rives, 1837). "Report of the Finances 1809" Reports. "Report of the Finances 1811," Reports. . "Report of the Secretary of the Treasury, 1811," Reports. . The Writings of Albert Gallatin. (Ed., Henry Adams) (Philadelphia, T. B. Lippincott & Co., 1879), Vol. HI. . "Letter to John W. Eppes, February 25, 1810," Writings, II. . "Letter to Ezechiel Bacon, January 10, 1812," Writings, II. . "State of Finance, December 1812," Finance, II. . "Report of the Secretary of the Treasury December 1812," Reports. "Letter to Monroe, October 26, 1814," Writings, I. Hessler, Gene. An Illustrated History of U.S. Loans, 1775-1898. BNR Press, 1985. Jones, William. "State of Finance, June 1813," Finance, II. "State of the Finance," Finance, 2:652. "Report of Finance, December, 1813," Reports. Knox, John J. "Letter to Langdon Chever, May 14, 1812," United States Notes, (New York: Charles Scribner's Sons, 1848). Laws of the United States Concerning Money, Banking, Loans 1778-1909, (National Monetary Commission, compiled by Andrew T. Huntington and Robert J. Mawhinney, Doc. No. 480, Senate 61st Congress, 2nd Sessions, Washington: Government Printing Office, 1910). Letter from the Chairman of the Committee of Ways and Means to the Secretary of the Treasury with the Answer of the Secretory of the Treasury (Alexandria: S. Snowden, 1812). Madison, James. "Fourth Annual Message, November 4, 1812," Compilation of Messages and Papers of the Presidents 1789-1897, Vol. 1. . "Veto Message January 30, 1815," Presidents. Niles Weekly Register, June 15, 1812; July 4, 1812; December 2, 1814; May 20, 1815 and December 4, 1815, Orzano, Michelle, "War of 1812," Coin World, September 22, 2003. "1812 Interest Notes Rarest of U.S. Issues," Coin World, April 6, 1992. Richmond Examiner, December 31, 1814 and June 7, 1815. Richmond Inquirer, February 16, 1814; May 7, 1814; January 11, 1815. Rulau, Russell. "War of 1812 Notes Seldom Come on Market," Bank Note Reporter, July 2000. . "Sale Raises Bar for Scarce Treasury Issues," Bank Note Reporter, April, 2005. Auction References Christie's Auction Catalogue, September 17, 1982, "Sale of the Alexander Vattemare Collection." Heritage / Currency Auctions of America Catalogue, February 18, 2005, "Sale of the Taylor Collection." Lyn Knight Currency Auction Catalogue, Oc6tober 16, 2004, "Sale of the John Whitney Walter Collection." R.M. Smythe Auction Catalogue, June 16, 2000; April, 2001; Sept., 1997 and June , 1993, "Sale of Alexander Vattemare Collection." Stack's Auction Catalogue, October 12, 2004, Sale of the John Jay Ford Collection." PAPER MONEY • September/October 2005 • Whole No. 239 351 rWANT ADS WORK FOR YOU R SPMC Founding Fathers were a smart breed. They knew Collector-to-Collector Want ads work. That's why they created "Money Mart" so they could place THEIR WANT LISTS before the rest of the members of our Society 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 SPMC's Founding Fathers built some great paper money collections that way Now YOU be a smart guy/gal too. Put out your want list in "Money Mart" and see what great notes become part of your collecting future, too. (Please Print) L ONLY $20.50 /YEAR ! ! (wow) r Announcing Paper Moneys Upcoming Specialty Publishing Program January/February 2nd Fractional Currency Issue May/June 6th U.S. National Bank Note Issue September/October 2nd U.S. Small Size Notes Issue SPMC's special 80-page issues of its award-winning journal Paper Money are the place to have YOUR ad seen Reserve your advertising space now Full Page rate $300 Half Page rate $175 Quarter Page rate $100 Contact Editor NOW Deadlines are Nov. 20th (Fractional Currency) & Mar. 15th (National Currency) J 352 September/October 2005 • Whole No. 239 • PAPER MONEY Second SPMC Author's Forum Whopping Success THE SOCIETY'S 2ND AUTHOR'S FORUM HELDJune 17th at the Memphis paper money show was a "rousing success." The event was hosted by SPMC Librarian Bob Schreiner and Paper Money. Featured speakers were SPMC member-authors Pierre Fricke, Gene Hessler, Fred Reed, Wendell Wolka, Art Friedberg, Dennis Schafluetzel, Tom Carson, in addition to Bob Schreiner, himself. The event was held at the Memphis Marriott Heritage Ballroom. This year's forum was two hours in length. Last year the program was an hour long. Schreiner said the program was lengthened because time restrictions last year were too constraining. He viewed the extended program as very suc- ,20 cessful, and indicated that another similar program would be held at Memphis next year (see Librarian's col- umn on page 398). The spirits of author/publisher and colonial bank note printer Benjam Franklin Q00' and bard William Shakespeare hung over I 7a. 3 f""4;this year's event. A special invitation/ tke A,» brochure for the event featured a doctored Franklin Bank note depicting Poor Richard and *014' the play write. "If you would not be forgotten, as 4 4 worth reading, or do things worth the writing." -- _4 Poor Rich (Benjamin Franklin, currency engraver - df SPMC thanks Mary Counts and Whitman ()". Publications, and Art Friedberg and The Coin and '`* Currency Institute, for supplying books, and Mike Crabb and the Memphis Paper Money Show for supply- ing our meeting room and refreshments. A welcome and opening remarks were offered by event moderator Schreiner, who also introduced a special project that he has been working on to record the Society's journal Paper Money in searchable PDF CD format. He brought the first phase of that project to the affair, "The 1980s," all 2760 pages of the journal on a single CD and esti- mated the entire run of 240 magazines (11,000 pages) would take only three or four CDs total. Bob's interest in paper money and passion for computers and imaging technology merges in his multiple roles for SPMC. This led him to embark on his current CD project: converting once paper-bound information which was difficult to find into a form readily and inexpensively usable by hobbyists, historians, and researchers. Paper Money embodies 11,000 pages of quality research not easily accessible, Schreiner indicated, but can become available to all schol- ars in convenient, cost-effective and searchable form. "When this project is done a shelf full of magazines will be available on 3/4 CDs giving researchers inexpensive and very powerful access to and control of infor- mation," he said. The Society Board will determine how best to disseminate/distribute this data. The second speaker was New York col- lector Pierre Fricke, author of a forthcom- ing book Collecting Confederate Paper Money - Comprehensive Edition (R.M. Smythe, 2005). Pierre began collecting coins in 1969. After participating in Civil War re-enactments in the late 1990s, his focus shifted to CSA paper money and bonds. In 2003, he picked up Dr. Douglas Ball's unfinished work on a new Confederate paper money book. This is designed to help one get start- ed and advance his/her col- lection and knowledge. Information rangies from great collections to differ- ent ways to approach col- lecting CSA notes, through grading guid- ance. "Building on Dr. Ball's research as well as my own, I present informa- tion on condition census of type and rare varieties, rare CSA note provenance, missing signifi- cant varieties and a much easier to use attribution guidance and pictures. The book is designed to give col- lectors the knowledge to make good purchases and to advance his or her collection" according to its author. Next up was former Paper Money Editor Gene Hessler, whose The International Engraver's Line (self-published, 2005) will debut later this year. Gene has written five books and 350 maga- zine articles including columns for Coin World and the Numismatist. He is listed in various editions of Who's Who in the Midwest, America and the World. Hessler was curator of the money muse- ums of The Chase Manhattan Bank Money Museum and the St. Louis Mercantile Bank. He is a retired musi- cian. The International Engraver's Line documents the lives and work of men and women engravers throughout the world. "There are approximately 1,000 entries with over 700 illustra- Bob Schreiner wears multiple hats for the Society and is very interested in applying technology solutions to information prob- lems. His current project is converting our journal to CD form. soon as you are dead & rotten, either write things 3. p. (0, p; , 41& printer) said. PAPER MONEY • September/October 2005 • Whole No. 239 353 tions, most of them in color. With computer programs now replacing hand engraving, this book will be document to an era that is coming to an end," Hessler said. This book is a companion to a previous similarly entitled work, The Engraver's Line (BNR Press, 1993), which provided similar coverage for intaglio engravers whose work was primarily in the U.S. Current Paper Money Editor Fred Reed explained his new book Show Me the Money! The Standard Catalog of Motion Picture, Television, Stage and Advertising Prop Money (McFarland, 2005). He explained that he did the book "for the sheer fun of it. Collecting should be for fun. Hobbies should take one away from the day to day humdrum and prob- lems. Movie money and the stories they tell are fun." In addition to his work on Paper Money, Reed is Confederate columnist for Bank Note Reporter and a weekly columnist for Coin World. He previously was a staff writer and News Editor for Coin World, and Vice President Publishing at Beckett Publications. Reed is owner of enthusi- ast-media.com ltd., a specialty niche publishing venture. Show Me the Money! is Fred's fourth numismatic title. Additionally, he has penned an underground novel, and edited dozens of books ranging from sports personalities to com- memorative coins to mental disorders. "Show Me the Money! is the first book of its kind to cross over between popular enter- tainment and numismatics," its author said. Based on insider information and research, it chronicles 1000+ films, catalogs nearly 300 types of prop notes (1,800 varieties) with 2,071 illustrations and index. Speaker five Wendell Wolka, author of A History of Nineteenth Century Ohio Obsolete Bank Notes and Scrip (SPMC, 2004) told how even a monster book like his could be readily kept current by means of CD updates. Wendell has been collecting something for nearly 50 years. His present passions are Ohio obsolete paper money and scrip, Ohio small size nationals, and lots of other "stuff" ranging from Bank of Canada notes to wire service photos of commercial airline disasters. Wendell writes several numis- matic columns and has written numerous articles and several books, including the SPMC volume for Indiana. Wolka's current project is a 2005 update of his 2004 Ohio book. The update will be offered as a CD, incorporating cor- rections, additions, and new discoveries made since the book's publication in July, 2004. "The CD offers low cost and the ability to provide full color illustrations, with plenty of space for information that simply would not fit into the book" Wolka said. Arthur Friedberg, co-editor with his brother Ira, of the standard Paper Money of the United States (Coin & Currency Institute, 17th ed., 2004) and A Guidebook of U.S. Paper Money (Whitman, 2005) told of future plans to meet the expected growth in the paper money collecting hobby. Art is the first American president of the International Association of Professional Numismatists (IAPN). He is an ANA LM and a member of PNG. With brother Ira, he has co-authored revisions of Gold Coins of the World (now the 7th edition) as well as PMUS (now the 17th). The brothers are also involved with the new Whitman paper money book, and At left (top to bottom) Pierre Fricke, Gene Hessler and Fred Reed make their points for their new books at the SPMC Author's Forum June 17th during the Memphis paper money show. 354 September/October 2005 • Whole No. 239 • PAPER MONEY Forum speakers Dennis Schafluetzel (left) and Wendell Wolka (right) shared their current projects with the authors' forum audience. Both happen to be involved in electronic book projects because this technology promises vast storage of information which is inexpensive and easy to update. Below, speaker Art Friedberg (right) autographs a copy of PMUS for another presenter Tom Carson. (Photos courtesy Whitman Publications and Bob Schreiner) will contribute pricing to Coin World's Paper Money Values magazine (see separate articles). In 1993 Friedberg was awarded IAPN's Book Prize for Gold Coins of the World. He also received ANA's Medal of Merit (1992), its 1st place Heath Literary Award (1994) and the Swiss Vrenelli Prize (1999) for "outstanding contributions to numismatics." "What does the future hold? With a new approach to grading possible, ever rising prices for most popu- lar/desirable notes, and so many new diversions, what can be done to provide basis for growth and new collec- tors?" Friedberg asked, and recounted recent ini- tiatives along these lines. Closing out the presentations were the duo of Dennis Schafluetzel and Torn Carson. As readers of this journal know, their Tennessee Merchant Paper Scrip (e-Book, 2005) is underway. Last year the duo also partnered to produce Chattanooga's Money written in HTML imported into Adobe Acrobat to use on web site or CD e- book. The work featured 1,000+ color images. "It was researched, written and published in 12 months; that work had seven CD updates in its first sales year," Carson noted. Schafluetzel began collecting coins in 1954 and switched to paper in 1996. He is VP of TSNS and president of GNA with articles in Paper Money, Numismatist, GNA Journal and Tenn Coin. Tom is an engineer turned Adobe Acrobat expert. He has collected Chattanooga items intensively for 25 years. A draft, of Tom's and Dennis' Tennessee Merchant Paper Scrip (2005) with 400+ unlisted TN merchant notes is at http://www.oldnote.org/tennesseescrip/ (pass- word = SPMC6000). They solicit additional TN scrip and information for the work. Following the presentations, a short question and answer session preceded a "meet and greet" which closed out the show. With all the current publication projects SPMC authors are working on next year's forum could be the best yet, forum sponsors claim. SPMC is at the forefront in numismatic pub- lishing and intends to remain committed to serving the hobby. So stay tuned for announcements on next year's event. -- Fred Reed PAPER MONEY • September/October 2005 • Whole No. 239 355 New Officers, Board members Highlight Memphis SPMC Memphis 2005 Board Meeting Minutes Meeting date June 18, 2005 Present: Mark Anderson, Benny Bolin, Frank Clark, Bob Cochran, Rob Kravitz (for part), Gene Hessler, Ron Horstman, Arri Jacob (for part), Tom Minerley, Bob Moon, Judith Murphy, Fred Reed, Bob Schreiner. Appointed non- Board member: Wendell Wolka. Visitors: David Boitnott, Wes Duran, Robert Vlack. The meeting was presided over by President Ron Horstman. The minutes from the November St. Louis meeting were approved. We heard a presentation from Robert Vlack asking us to re-issue a revision of his book on ad notes. He has consider- able new material, including some 800 Confederate facsimile advertising notes that might be incorporated. He left President Horstman with a detailed proposal. In the follow- ing discussion, in order for SPMC to proceed, we would need a letter of understanding from the current publisher, R.M. Smythe. Who will actually produce the printable manuscript? There was concern about including the Schingoethe material, expected to come up for sale soon. It was noted that this would not be a Wismer project. President Horstman said he would speak with someone at Smythe about the feasibility of transferring this to SPMC. Officer Reports President's report (Ron Horstman). This is in his last Paper Money column. Vice President's report (Benny Bolin). No report (but see his reports for Education and Awards Committees). Treasurer's report (Mark Anderson). He provided a detailed separate report. Our financial situation is about the same as last year at this time. Life membership balance is up a little. Investments have done slightly better, but are still flat. The Breakfast this year took in $1,472 in ticket sales and $1,065 in raffle ticket sales, together these result in a small profit. Secretary's report (Bob Schreiner). He provided a sepa- rate report. We have 1,568 members; there were 1,511 last John Wilson and Wendell Wolka at the Tom Bain Raffle. year. Appointee Reports Regional meetings (Judith Murphy). There were sessions at Pittsburgh ANA, FUN, and Kansas City. There will be a meeting at the San Francisco ANA. Murphy and Wendell Wolka, who together conduct most of these sessions, have asked for a per diem consideration, perhaps 10-60% of actual travel costs. They were asked to develop a proposal and bud- get related to this and submit it to the president for distribu- tion/consideration by the entire board via email. Library (Bob Schreiner). Reported that the library con- tinues pretty much as last year. He bought or was given about 20 books, and loaned fewer. Demand for photocopies of Paper Money articles continues steadily, although not a big demand. He noted that he has digitized all 1980s copies of Paper Money and circulated these on one CD to Board members as an example of what can be done. Web Site (Bob Schreiner). The SPMC web is being maintained, but there have been no major changes. Advertising manager (Wendell Wolka). Advertising has increased to some extent and is helping to pay for the addi- tional pages for our special issues and overall increased num- ber of pages per year of Paper Money. While advertising rev- enue is an important component of the Paper Money budget, we still depend on member dues to provide the service. Wismer Project (Bob Cochran). Cochran reported a pos- sible Florida book from Ron Benice. There was discussion of a possible 1812 book from Forrest Daniel. There was one comment that the appearance of this material as a book is unlikely. Membership (Frank Clark). He provided a separate report. The SPMC web continues to be the biggest recruiter, followed by Tom Denly, Wendell Wolka, Frank Clark, and Fred Reed. Over the last year, we have added 231 members. This number includes new members, reinstatements, and peo- ple who originally join as life members. Paper Money Publisher/Editor report (Fred Reed). The volume of manuscripts continues, although the page increase in Paper Money has absorbed much of the backlog. The wait time to publication is now much more acceptable. Bolin asked that the meeting minutes be printed more quickly. He also asked to include more information about regional meet- ings. Can we consider publishing some articles on the web? Awards Committee (Wendell Wolka). We are in a tran- sition period to adopting the new awards scheme. There are now many more awards, some two dozen, and that adds cost, about $1,500/year. Wendell, after long service as awards chairman, has asked to be relieved of this duty. The President will seek a new awards chair person. Bolin added that he took part of the Awards Committee responsibility, names for the Wismer, Founder's and Gold awards. Education Committee (Benny Bolin). He provided a sep- arate report. The committee approved two research awards to Peter Huntoon (National bank notes), one to William McNease (MPC), and one to Larry Falater. Proposals have been received from Neil Shafer, Gene Hessler, Alec Pandaleon, and Peter Huntoon. No Maverick Cards were awarded over the last year. SPMC 6000 Committee (Bob Cochran). Cochran has been active in pursuing non-renewers, resulting in a smaller 356 September/October 2005 • Whole No. 239 • PAPER MONEY SPMC breakfast-Tom Bain Raffle emcee Wendell Wolka (left) warms the crowd with his easy-going manner and quips. Board member Bob Cochran is rapt attention by the proceedings. member loss this year than last. He noted that many paper money dealers are not members. We tried advertising in the American Philatelic Society Journal with little success. The Bank Note Reporter ad has brought in about 10 members over several months. Should we add 3-5 year membership deals? Election of Board members. Bob Moon, substituting for Election Chairman Tom Minerley, reported that Bob Cochran, Gene Hessler, Tom Minerley, and Jamie Yakes were elected. There were 153 ballots (154 last year). Old Business Election of Officers. The SPMC Board elects officers. President Horstman said he would not run for re-election. Nominations included Benny Bolin, president; Mark Anderson, vice president; Bob Schreiner, secretary; and Bob Moon, treasurer. All were elected. The new treasurer will seek bonding, as required by the bylaws. Board resignation and appointment. Bob Moon announced that he would resign as a Board member but con- tinue as treasurer. His resignation was accepted. Board candi- date Wes Duran was appointed to fill Moon's remaining term (2 years). Duran accepted. Financial matters. There was discussion about adding a second person as check signer. It was moved by Bolin and sec- onded by Minerley that the secretary should be the second signer. Motion passed. During the transition to the new treasurer, Anderson will continue to write checks. We also need an audit committee. New Board member Duran noted that he is an experienced auditor. Anderson also reported that he was working on establishing a more formal financial arrangement with the Publisher/Editor of Paper Money. Anderson also produced a separate document that outlined backup and redundancy procedures for critical documents such as financial records, Paper Money files, and membership records. 1929 Project (Arri Jacobs). He raised again the issue of dropping this project. Should we offer the material to author(s) known to be working on this subject? A motion was made by Schreiner, seconded by Cochran: SPMC will drop the project and offer the data to anyone on a non-exclusive basis for the cost of copying the material. SPMC retains the original material. Jacobs has the material and will send it to the library. Motion passed. Awards. There are matters unresolved with respect to the physical awards for the new awards. Did we ever decide on a final design for the Founder's Award? What is the cost from Medallic Arts for the proposed plaquette for the Founder's Award? We recalled it was about $40-50 each in quantity 20, but Reed will check. Reed and the head of the Awards Committee will clarify this and other details. We also need to determine the physical Awards of Merit. For the literary awards (6 categories, first and second), Wolka suggested some- thing that can be used, such as clocks. The new member recruitment award, Blanchard award, and best exhibit in show are all physically the same. We intend to keep like awards about the same across all awards. Memberships as gifts. We discussed providing major advertisers with bulk memberships that they could use with their customers. They would be for one year and then renew- able the usual way. We can start by giving 10. We also dis- cussed permitting auction houses and other third parties to purchase bulk memberships as gifts to clients. The latter was already adopted as a part of the Modest Proposal. The former was moved by Anderson, seconded by Schreiner. Motion passed. New Business Slabbing. President Horstman circulated examples of slabbed (commercially graded and sealed) paper money. Bylaws. Copies of the current bylaws were distributed to Board members. Other. There were calls for congratulations and honors for outgoing President Horstman, incoming President Bolin, and past President Clark, who now rotates off the Board. Unanimously supported by the Board. President Horstman adjourned the meeting at 11:00 a.m. Respectfully submitted, Bob Schreiner, Secretary PAPER MONEY • September/October 2005 • Whole No. 239 357 SPMC Honors 2005 Award Winners Judith Murphy receives Lifetime Achievement Nod 1- ITERARY, SERVICE AND EXHIBIT AWARDShighlighted SPMC activities at the recent Memphis show. The Society of Paper Money Collectors continues to place great importance on recognizing the efforts of writers, researchers, exhibitors, and persons willing to serve both the hobby in general and the Society in particular. Many times, the efforts of these people are overlooked, and the Society's awards program is one way in which it attempts to provide such recognition. As part of our on-going SPMC 6000 program to improve member services, awards were "kicked up a notch" this year, the Awards Committee acknowledged. The following awards were presented by the Society. Nathan Gold Memorial Lifetime Achievement Award Established and formerly presented (1961-1970) by Numismatic News, now by the Bank Note Reporter/SPMC. includin heading up the ,e,*(` .0.6‘ • o Ca Society's g regional meetings pro- ♦ °Y&W, t. 4CNN% V'c),gram. t•C)N e• D . C . Wismer Award S4eR . • S2''aAwarded to the author of the best new G (Xi 010 01 ,1 '22708> PAPER MONEY • September/October 2005 • Whole No. 239 387 ' 441442141t -4 1+1/ Cagh'k ' . ' 388 September/October 2005 • Whole No. 239 • PAPER MONEY right hand some stalks of wheat, while her left grasps a sickle and supports a sheaf. On either side of the vignette is the figure 1. The true twenty dollar bills have, as a centre vignette a female figure scattering coins from an open bag. In the background on her right is a ship and on her left, the figures 20 engraved in a rock. On each side of the vignette, between it and the ends, appear the figures 20. At the left end of the bill the word CONNECTICUT occupies the middle, while the characters XX appear at the top and bottom. At the right end, the figures 20 are twice repeated. At the bottom separating the signatures of the cashier and President is a steamboat. The altered bills are very skillfully and successfully executed, and consequently, well calculated to deceive." CTBNL June 1855. 3. $1. Shield, arrows, female &c; reapers at right; female at left. CTBNL Dec. 1862. Ocean Bank, Stonington 1. $2. Steamboat; sailor and flat at left. Poor imitation of genuine. CTBNL Aug. 1856. 2. $5. Men in forest cutting wood; 5 and men gathering corn at right; men shearing sheep at left. CTBNL Dec. 1861. Paweatuck Bank 1. $50. Angel in clouds; female each side below. CTBNL May 1865. 2. $2. Mechanics, shipyard, 2; 2, two squaws at right; 2 at left. Similar to genuine. Thompson 1863. Pequonnock Bank, Bridgeport 1. $2 photographed. CTBNL Aug. 1860. 2. $1 altered. Female each side of large figure 1; ONE, female, ONE at right; ONE, two men carrying a female, ONE at left. CTBNL Apr. 1861. Phoenix Bank, Hartford 1. $10. Locomotive and cars. CTBNL Jan. 1857. 2. $5. Three females; 5, V, 5 at right; 5, V, 5 at left. Similar to genuine. Thompson 1863. Quinebaug Bank, Norwich 1. $2. Female reclining; two females at right cupids at lower left. Very coarse. CTBNL Sept. 1858. Quinnipiack Bank 1. $5 altered from genuine $1. Indians in canoe. CTBNL July 1856. Rockville Bank 1. $3. Steamboat, locomotive, cars &c; female at right. CTBNL Jan. 1857. 2. $5 altered from $1. Female tending looms. CTBNL Jan. 1857. 3. $1. Poor imitation of genuine. CTBNL Jan. 1857. 4. $3. Female, sheaf of grain, cows &c. female at right. Unlike genuine. CTBNL Jan. 1857. 5. $5 altered. Drove of horses; girl at right. CTBNL Feb. 1859. Saugatuck Bank 1. $2. Horseman pursuing cattle on prairie; Indian at lower right; female at lower left. Poorly done. CTBNL Mar. 1854. (Below) 2. $5 altered from $1. Man and boy driving sheep; man sowing seed at right. CTBNL Jan. 1857. 3. $10. Man, horse, boy and sheep. CTBNL Jan. 1857. Saugatuck Bank #1 PAPER MONEY • September/October 2005 • Whole No. 239 389 Saybrook Bank 1. $5. Female, wheat, agricultural implements &c; female at lower right; Harrison at lower left. Poor affair. CTBNL July 1856. 2. $3. Female, bale, ship &c; 3 at right; THREE across right and left. Similar to genuine. Thompson 1863. Shetucket Bank 1. $20 altered from $2. Farmers nooning; female bust lower right center; cattle, hay wagons &c. at left. CTBNL Jan. 1857. 2. $5 altered from $1. Man, woman and child; sailor at right; bust of female at let. CTBNL Jan. 1857. 3. $10 altered rom $1. As above. CTBNL Jan. 1857. Southport Bank 1. $10 altered from $2. Three men standing; Indian woman at right; ship at left. CTBNL June 1855. 2. $2 photograph. Three men; female and child at lower right; ship at lower left. CTBNL Jan. 1857. 3. $2 raised. Three females; Martha Washington at right; Washington at left. CTBNL Sept. 1858. 4. $1 imitation. Three females around shield surmounted by eagle. Red ends. CTBNL Dec. 1861. 5. $3 imitation. Train of cars; 3, two farmers with rakes at right; THREE, male and female Indians on rock overlooking river and village, THREE at left. CTBNL Feb. 1865. Stafford Bank 1. $10 raised from $2. Two females, girl, two cows, milk pail, ship, house &c; female with scales, eagle at lower right; head of Washington at lower left. CTBNL Sept. 1858. Stamford Bank 1. $10. Train of cars; female, sword, steamboat at right end. Unlike genuine. CTBNL mar. 1854. 2. $5 altered from genuine $1. View of Stamford Bank; goddess of Liberty at left. CTBNL June 1855. 3. $10 altered from broken bank affair. Eagle; woman and Indian at right. CTBNL July 1856. 4. $3. River, boat, cars, bridge, portrait each side; 3, female, THREE at right; THREE, Washington, THREE at left. Similar to genuine. Thompson 1863. (Below) Stamford Bank #4 State Bank, Hartford 1. $5. Arms, female on right, flags; 5, females, tools &c, FIVE at right; 5, sailor, goods, FIVE at left; Similar to genuine. Thompson 1863. 2. $100. Eagles on shield; 100, man, cornucopia, 100 at right; 100, female, anvil, 100 at left. Similar to genuine. Thompson 1863. Thames Bank 1. $5 altered from $1. Cattle &c; man and horse at lower right; FIVE in red letters on bottom; CTBNL Mar. 1854. 2. $5 altered from $1. Cattle &c; man and horse at lower right; FIVE in red letters on bottom; CTBNL June 1855. 3. $5. Five cupids encircled in figure 5; 5, female, FIVE at right; FIVE, Male, 5 at left. CTBNL Sept. 1858. 4. $2 altered. Man and woman standing by well; female supporting 2 at right; two silver dollars at left. CTBNL Feb. 1859. 5. $5. Four men loading hay on wagon with two oxen at right; men with cattle in a stream at left. CTBNL Apr. 1862. 390 September/October 2005 • Whole No. 239 • PAPER MONEY Thompson Bank, Thompson 1. $3. Large 3, oval female portrait each side; 3, blacksmith seated at right; 3, Washington on horseback at left; Some of these bills have a portrait of Franklin on the right end, and a portrait of Washington on left end. CTBNL Feb. 1865. Tolland County Bank, Tolland 1. $100 imitation. Spread eagle on branch of tree, aqueduct and cars; 100, Vulcan seated at right. CTBNL Dec. 1862. 2. $10. Two females, factories; 10, girl at right; 10 female at left. Similar to genuine. Thompson 1863. Tradesmen's Bank, New Haven 1. $5. Female, barrel, urn, ships; female and agricultural scene at right; portrait at left. CTBNL Jan. 1857. 2. $1 altered. Battle scene; house at right; female portrait at left. CTBNL Dec. 1857, CTBNL Feb. 1858. Uncas Bank, Norwich 1. $5 altered from $1. Two figures working a press; female, sheaf of grain at right; blacksmith at left. CTBNL Aug. 1856. 2. $10 altered from $1. As above. CTBNL July 1856. Union Bank, New London 1. $5. Five male busts with 5; steamboat at right; anchor and shield at left; blue tint. CTBNL Feb. 1859. 2. $10 altered. Men, horse, dogs, X and child, bust at right; X, sportsman with gun and dogs at left. CTBNL Feb. 1859. Waterbury Bank 1. $10 altered from $1. Two females; two females at right; two females at left. Unlike genuine. CTBNL Mar. 1854. 2. $10. Steamship, ships &c; Washington at right. CTBNL July 1856. 3. $1. Indian hunting deer; 1, portrait at right; men picking cotton at left; ONE across left end. CTBNL Sept. 1861 4. $10. Well executed. CTBNL Dec. 1861. 5. $10. Female seated with key; 10, goddess of Liberty at right; 10, female and scales at left; dog's head between signatures. "Refuse all $10s." CTBNL Dec. 1861. 6. $10. Female in 10, bridge, cars &c; 10, female at right; 10, female at left. Similar to genuine. Thompson 1863. Whaling Bank, New London 1. $2 altered. Steamship, Indian girl at right. CTBNL Jan. 1861. Windham Bank 1. $20 altered from $1. Harvest scene; frogs at right; female with a shield at left. CTBNL June 1855. 2. $10 altered from smaller note. Two cows, female at right;mechanic at left. CTBNL Jan. 1857. 3. $5 altered from $1. Three men and one woman in a field; two frogs at right. CTBNL Jan. 1857. 4. $5 altered from $1. Similar to above. CTBNL Jan. 1857. 5. $20 altered form small note. Farmer, sailor and mechanic; girl with a bundle of faggots (sticks) at left. CTBNL Jan. 1857. 6. $10 altered from small note. Two cows; female at right; mechanic at left. CTBNL Jan. 1857. Winsted Bank 1. $1. Train of cars; 1, bust of man, ONE at right; 1, bust of man, ONE at left. CTBNL Aug. 1860. Wooster Bank, Danbury 1. $5 altered. Capitol at Washington; 5 and female at right; 4, state arms, FIVE at left. CTBNL Apr. 1860. Bryn Korn Tom Denly Robert Neale Frank Clark SPMC (sponsors of at least 2 Andrew Korn Allen Mincho Paul Burns Bob Cochran 6000 Honorees new members since March Fred Reed Wendell Wolka Ron Horstman Rob Kravitz 1, 2004) Jack Levi Judith Murphy Arri Jacob Mark Anderson PAPER MONEY • September/October 2005 • Whole No. 239 391 NEW MEMBERS MEMBERSHIP DIRECTOR Frank Clark P.O. Box 117060 Carrollton, TX 75011 SPMC NEW MEMBERS - 07/17/2005 10993 Louis H. Geser, 50 West 96th St Apt 9B, New york, NY 10025 (C, Nationals), Tom Denly 10994 Joseph F. Gorman (C), Lowell C. Horwedel 10995 John R. Hench II, (C), Tom Denly 10996 Joseph R. Smith (C), Torn Denly 10997 Larry Eggert, 194 Independence Dr, Lockport, NY 14094 (C), Website 10998 Chuck Nickle, Rt 1 Box 1470, Cassvill, MO 65625 (C, Fractional, Gold Certificates), Website 10999 Elmer Powell (C), Website 11000 John W. Eshelman, 119 S. Duke St, Lancaster, PA 17602- 3509 (C, US Large & Small, Confederate), Wendell Wolka 11001 William D. Haydon, 10230 N. Delaware St, Indianapois, IN 46280 (C, US), Website 11002 Derek Moffitt (C), Wendell Wolka 11003 Robert D. Raby (C), Bob Cochran 11004 Paper Money Guarantee, C/O Glen Jorde, PO Box 4755, Sarasota, FL 34230 (D, Paper Money Grading Service), Glen Jorde 11005 Peter D. Adams (C), Website 11006 Clarence G. Brisee, 590 Route 9 West, Glenmont, NY 12077-3702 (C), Website 11007 Steve Cox (C), Torn Denly 11008 Dave Steckling, PO Box 934, St. Cloud, MN 56302 (C & D, US & Obsoletes), Frank Clark 11009 James C. Gray, PO Box 1924, Gastonia, NC 28053-1924 (C, North Carolina - Colonials thru Nationals), Website 11010 Jimmie Davis, 4340 Columbia 34, Magnolia, AR 71753- 9616 (C, Arkansas Nationals), Wendell Wolka 11011 Bob Bergstrom, 1711 Driving Park Rd, Wheaton, IL 60187-3226 (C, Fiscal Items with Revenue Stamps), Website 11012 Cliff Andrews, PO Box 198, Great Mills, MO 20634 (C, Aces & Norfolk, VA Nationals), Website 11013 Alexander Sczech, 25827 S River Park Dr, Inkster, MI 48141-1962 (C, Obsoletes), Stephen Goldsmith 11014 Dwight Kent (C), Wendell Wolka 11015 Roy Cragway Jr., 13 Whitehorse Dr, Berlin, MD 21811- 1610 (C, US Small & Errors), Torn Denly 11016 Dave Petrashek, 4205 Bagley Parkway, Madison, WI 53705 (C, Obsoletes, MPC), Wendell Wolka 11017 Tom Powell, 10903 Equestrian Ct, Reston, VA 20190 (C, US Type), Wendell Wolka 11018 Rex Buckley, 6955 Banchory CT, Alexandria, VA 22315 (C, US Small & WW II Military), Torn Denly 11019 James Hill, (C & D), Wendell Wolka 11020 Mary Counts (C), Fred Reed 11021 Levente Jakab, 511 Walker Dr #6, Mountain View, CA 94043 (C, US Large), Frank Clark REINSTATEMENTS 6286 Robert P. King (C), Frank Clark 10482 Monty Farmer, POB 3477, Meridian, MS 39303 (C) Frank Clark LIFE MEMBERSHIP LM363 Roger Barnes, (C), Torn Denly DO YOU COLLECT FISCAL PAPER? The American Society of Check Collectors publishes a quarterly journal for members. Visit our website at http://members.aol.com/asccinfo or write to Coleman Leifer, POB 577, Garrett Park, MD 20896. Dues are $10 per year for US residents, $12 for Canadian and Mexican residents, and $18 for those in foreign locations. New Hampshire Notes Wanted: Obsolete currency, National Bank notes, other items relating to New Hampshire paper money from the earliest days onward. Dave Bowers Box 539 Wolfeboro Falls, NH 03896-0539 E-mail: qdbarchive@metrocast.net Always Wanted Monmouth County, New jersey Obsoletes — Nationals — Scrip Histories and Memorabilia Allenburst — Allentown — Asbiny Park — Atlantic Highlands — Belmar Bradley Beach — Eatontown — Englishtown — Freehold — Howell Keansburg — Keyport — Long Branch — Manasquan — Matawan Middletown — Ocean Grove — Red Bank — Sea Bright — Spring Lake N.B. Buckman P.O. Box 608, Ocean Grove, NJ 07756 800-533-6163 Fax: 732-282-2525 Why? Why do the leading paper money dealers advertise in PAPER MONEY? Because they are the LEADING DEALERS & They intend to remain THE leaders! • You can be a leader too • • Advertise in PAPER MONEY • September/October 2005 • Whole No. 239 • PAPER MONEY392 New President Outlines Future HELLO TO ALL! AT THE ANNUAL BOARD OFGovernor's meeting of SPMC held in June at the International Paper Money Show in Memphis, I had the extreme honor and privilege to be elected President of the Society. This is a role that I take with pleasure, excitement and humility. Many of you know me, but if you don't, just a little about myself. I live in Allen, Texas, just 30 miles north of Dallas. I have been collecting for 41 years, actively paper since 1982. My primary collecting focus is Fractional Currency and South Carolina obsoletes. As we enter into this new era of SPMC with a new President, Vice-President, Treasurer and two new governors, my goal is to have a board that is extremely responsive to its members. You elected us as governors to serve you and take the hobby forward into the future with innovation and involve- ment. I am working to have the board increase its communi- cation, not only internally, but with the membership and tilt hobby as a whole. My belief is that communication is the most integral part of any organization. However, communication MUST be two-way. Not only will we need to communicate with you, but I urge you to communicate with us. Ask us your questions and let us know your concerns and your ideas. I make you the pledge that I will present all of your concerns and ideas to the board, and we will discuss them and act as we are able. Just remember, this is your Society and your input is needed. At the board meeting, we made a decision on the 1929 Project. We have decided to let those in the field who have more data, knowledge and resources continue with it. All of the data that has been submitted for this project will be sent to the librarian. Hopefully it will be available around the first of the year to anyone who wants a copy for the cost of mailing and copying. We have also decided to institute a method of paying dues and other payments to the society via credit card. Treasurer Moon is working now to set this up. We are also working on a new committee structure, our regional meeting initiative and we are investigating a program that will rely on some of you to help us as speakers for clubs and shows. Overall, I am very excited and honored to be your new President. I hope you will find that I fulfill that task in a man- ner that is pleasing to you. If not, please let me know. I am not able to attend that many national shows, but I will be at the PCDA show in St. Louis in November. Find me and bend my ear for a while. I want to thank Wendell Wolka and Arri Jacob who did not run for re-election to the board for all their hard work and efforts on behalf of the society. Wendell will be continuing with us in a number of appointed capacities. I also would like to thank Ron Horstman for his leadership the last two years as President. Benny $ money mart PAPER MONEY will accept classified advertising on a basis of 15e per word (minimum charge of $3.75). Ad must be non-commercial in nature. Word count: Name and address count as five words. All other words and abbreviations, figure combinations and initials count as separate words. No check 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 contribution to the Society. These ads are denoted by (A) and are run on a space available basis. Special: Three line adk six issues = only $20.50! (wow) WASHINGTON STATE NATIONALS WANTED. Seeking large- size WA nationals from Aberdeen, Hoquiam, and Montesano. Chris Flaat, cflaat@msn.com, 425-706-6022 (244 SHAWNEE AND KINGFISHER Oklahoma Nationals wanted #9998 and #6416 with George McKinnis signature. Large size #9954 and #5328. Carl Cochrane, 12 Pheasant Dr., Asheville, NC 28803, e- mail cicochrane@pirodigy.net (243) EUREKA SPRINGS, ARKANSAS Banknote wanted. Also any relat- ed contemporary banking material. Martin Roenigk, 75 Prospect Ave., Eureka Springs, AR 72632. (479) 253-0405. mroenigk@aol.com (239) KANSAS NBNs WANTED. Goodland #14163, Olathe #3720, Pleasanton #8803. A.R. Sundell, Box 1192, Olathe, KS 66051 (236) BANK HISTORIES WANTED. Collector seeking published histo- ries of banks which issued Obsoletes and/or Nationals. Also seeking county/state/regional banking histories. Bob Cochran, PO Box 1085, Florissant, MO 63031 e-mail: spinclni69@cs.com (234) LINCOLN PORTRAIT ITEMS. Collector desires bank notes, scrip, checks, CDVs, engraved/lithographed ephemera, etc. with images of Abraham Lincoln for book on same. Contact Fred Reed at P.O. Box 118162, Carrollton, TX 75051-8162 or freed3@airmail.net (245) WANTED. Canadian Chartered Bank Notes. Wendell Wolka, PO Box 1211, Greenwood, Indiana 46142 (234) WANTED KANSAS. Obsoletes -- Checks -- Drafts. S. Whitfield, 879 Stillwater CT, Weston, FL 33327 (234) SOUTH BEND, INDIANA. Obsolete paper money from South Bend or St. Joseph County wanted. Bob Schreiner, POB 2331 Chapel Hill, NC 27515-2331; email: rcschreiner@mindspring.com (234) WANTED. OBSOLETES AND NATIONALS from New London County CT banks (Colchester, Jewett City, Mystic, New London, Norwich, Pawcatuck, Stonington). Also 1732 notes by New London Society United for Trade and Commerce and FNB of Tahoka Nationals #8597. David Hinkle, 215 Parkway North, Waterford, CT 06385. (249) SHOW ME THE MONEY! Standard Catalog of Motion Picture Prop Money (2005) by Fred Reed, 800 pages, $82.50 postpaid & you get FREE Prop note. P.O.B. 118162, Carrollton, TX 75011-8162 (239) DC AND NY BANK HISTORIES WANTED. Collector seeks pub- lished works for research. Alan Palm, 301 G St. SW-Apt. 201, Washington, DC 20024; (202) 554-8976; e-mail aspalm2003@yahoo.com (244) WANTED RADARS, REPEATERS, low and fancy serials 1928- 1963 also Large Size 8 digit radars and repeaters. Logan Talks, 14 Misty Cove Ln., Hilton Head Island, SC 29928 (243) MASSENA, NEW YORK #6694 bank notes wanted, large or small size, also obsolete and related materials to Massena banks. John White, P.O. Box 3183, Spring 1E11, FL 34606 (243) POTSDAM, NEW YORK #868 and #5228 bank notes wanted, large and small size, also obsoletes and materials relating to Potsdam banks, John White, P.O. Box 3183, Spring Hill, FL 34606 (243) PUT YOUR AD HERE • ONLY $20.50 FOR SIX ISSUES • To all Persons to whom these Presents shall come. The v7 10 (4,-,4 641011 Gve.4,,,aJsfia. a banking corporation estab. lished by the Geneafl Assembly of the State of Rhode Island and Provideptce Plantations, and located in t.,% MV:14-; /— in the County of (../7 41,41-7- herepy acknowledges to have received of cifott-hlv Governor, ;ea Gi+vy ouweii3 Secretary, and J 041,, 0-E4--4,-0 General '*easurer, Commissioners appointed by an act of thkGeneral Assembly of said State, at the session thereof, on the last Yonday of October, one the sand eight hundred and thirty six, the sum of e.,,,f) a-e, 541-2,(Azeti v 4yz - in Deposit, under and in conformity with,the provi- sions sif the aforesaid act, entitled "an act to provide for the disposition of the proportion of the money of the United States to be deposited with this State, by virtue of an act of Congress, entitled an act to regulate the Deposites of the Public Money, apprcved June 2S, 1836 ; and also to provide for the appropriation of the interest arising from said money." And the said Corporation by their corporate name aforesaid, do hereby covenant and agree to and with said Commissioners and their succesors, to pay an Interest at the rate of Five per cent. per annum for the use of said money, at the time and in the manner specified by said act ; and to pay over said amount so deposited, or any part thereof, to the order of said Commissioners or their successors, whensoever required, in conformity with the provisions of said act. In Testimony whereof the President of said Corporation, being thereunto authorized by the Board of Directorp, has subscribed his name, and affixed the seal of said Corpora- tion hereunto, this ..0&72-,4, day of Signed sealed and delio- ) and in presenca of 5 924 A. D. 183/7 PAPER MONEY • September/October 2005 • Whole No. 239 393 When the National Debt Was Actually Paid By Forrest W. Daniel T HE NATIONAL DEBT WAS ACTUALLY PAID -- ONCE! And not only that, the remaining surplus was distributed to the States in the form of a deposit which could be reclaimed at the pleasure of the federal government. That was in 1837. Congress finally decided a recall of the $28,000,000 would do little to alleviate the debt of nearly a trillion dollars which had accrued since 1837, so on December 28, 1980, President James E. Carter signed a bill to confirm the distribution and cancel the deposit clause of the original act. The money finally belonged to the states, which was the idea in the first place. In addition to the regular borrowing necessary to maintain the day-to-day business of the United States at its inception and early years, there were two massive loans which greatly expanded the public debt. The first was the fund- ing of the domestic debt amassed during Revolutionary and Confederation years. The assumption of that inflated debt by the Act of August 4, 1790, even when reduced to its specie value, (about $1 for $100) amounted to $64,456,963.90. And loans to finance the War of 1812-1815 brought in only $34,000,000 specie value for more than $80,000,000 of indebtedness, plus interest. The funds to pay federal obligations came principally from import duties, levies on the tonnage of ships and in later years the sale of public lands. The only direct taxes levied to finance the War of 1812 were enacted too late to pay any of the costs while the war was being carried on. The nation was so pros- perous, despite repeated temporary setbacks, during the post-war period 1816- 1836 that the entire national debt was retired and the surplus was so great that something had to be done about it. As early as 1816 it was suggest- ed that the yearly estimated surplus- es of between $2 and $6 million, be distributed to the states, with inter- nal improvements -- roads, canals, railroads and the like-being a sug- gested use for the funds. Twenty years later the debt was virtually paid by January 1, 1835, so in 1836, with a projected surplus of $50,000,000 at the end of the year, Congress, passed a bill on June 23 to distribute the January, 1837, surplus to the several States in proportion to their repre- sentation in Congress. The suggestion that the gov- ernment, itself, spend the money on internal improvements was rejected. The Democratic administration of President Andrew Jackson was firmly Certificate of Deposit issued by the New England Commercial Bank, Newport, for funds received on deposit from the State of Rhode Island. The money was part of the second installment of Treasury deposits under the Act of June 23, 1836. ...1‘,--z-Z.77 X47 / //70 September/October 2005 • Whole No. 239 • PAPER MONEY394 A. D. 189 At a meeting of the Directors of the toted, that we will accept in behalf' of said Bank our proportion of the Public Money, in Deposit, under the provisions of the act of the General Assembly passed in October last, entitled " An act to provide for the disposition of the proportion of the money of the United States to be deposited with this State, by virtue of an act of Congress, entitled An act to regulate the Depositcs of the Public Money, approved June lid, MO; and also to provide for the appropriation of the interest arising from said money." Voted, That the President of this Bank, be and he is hereby authorized and directed to execute all necessary instruments therefor, and affix the Seal of the Corporation thereto, True copy—witness: Cashier. opposed to any federal funding for internal improvements. It was the duty of the States, alone, he believed, to finance their own internal development. Congressmen opposed to the distribution felt that although $5,000,000 was reserved as a nor- mal carry-over, at least some of the money might well be needed again sometime in the future. They were strong enough to modify the form of the distribution into a deposit of the funds, subject to recall when needed. The form of the required certificates of deposit and terms for recall of the money were set out in the Act, although no one really believed that would ever hap- pen. The deposits with the States were to be made quarterly beginning in January 1837. The supposed $50 million surplus dwindled to $42,000,000 by December 1, and to $37,468,859.97 when it was divvied the first of January. Although some believed the funds should have been divided according to population, the amounts were based on each state's Congressional delegation: New York, with 42 members, was to receive $5,352,694.28; Arkansas, Michigan and Delaware each had three members and anticipated $382,335.31. The amount to be divided among the States was $37,468,859.97; the initial installment was $9,367,214.98. The first two payments were made in specie or its equivalent; but when the third payment fell due on July 1, the States were offered, and gladly accept- ed, depreciated paper. The Treasury was short of funds for the October installment, so payment was delayed until January 1, 1839; but when that day arrived again no funds were available, and never since until recent years has there been a surplus. While the final total $28,101,645 of deposits could have been recalled, they never were. The deposit of funds was the last of a number of massive transfers of public funds in the 1830s. The Bank of the United States, as financial agent for the Treasury, was responsible for having the required funds, specie or its equivalent, in place when and where it was needed to make payments. That process could involve massive purchases of internal or foreign exchange and often the transfer of specie between distant markets, all at the bank's expense. The movement could, and did on several occasions, cause serious disruption of regular mercantile operations. While the liquidation of the national debt was spread over several years, it left the Treasury's balance at the Bank of the United States at a lowered total. In consequence of President Jackson's opposition to the Bank, on September 26, 1833, the Treasury began to deposit its receipts in seven pri- vate banks rather than the Bank of the United States, while it continued to make regular withdrawals from that bank. Only one of the seven banks receiving deposits was not solidly Jacksonian; the number of "pet banks" increased later. Until the Act of June 23, 1836, however, no standards defined the requirements necessary for a state bank to qualify for Treasury deposits. Thus, when the Treasury surplus deposits were made to the States (under the same Act) in January, 1837, it was the eighty-eight pet state banks which were called upon to produce those funds in specie, in large amounts, in short order. Many of those banks and bankers were unacquainted with that type of business, but they were able to make the first two installments in specie, padded the third with depreciated paper and flunked the fourth payment. Most of the banks were forced to suspend specie payment in the spring; only five or six continued to redeem their notes in specie and to remain deposit Uncompleted second page of the New England Commercial Bank Certificate of Deposit. Memorandum of receipt upon repay- ment of deposit, endorsed on back of the certificate. Amounts Deposited with the States in 1837 Alabama $ 669,086.79 Arkansas 286,751.49 Connecticut 764,670.60 Delaware 286,751.49 Georgia 1,051,422.09 Illinois 477,919.14 Indiana 860,254.44 Kentucky 1,433,757.39 Louisiana 477,919.14 Maine 955,838.25 Maryland 955,838.25 Massachusetts 1,338,173.58 Michigan 286,751.49 Mississippi 382,335.30 Missouri 382,335.30 New Hampshire 669,086.79 New Jersey 764,670.60 New York 4,014,520.71 North Carolina 1,433,757.39 Ohio 2,007,260.34 Pennsylvania 2,867,514.78 Rhode Island 382,335.30 South Carolina 1,051,422.09 Tennessee 1,433,757.39 Vermont 669,086.79 Virginia 2,198,427.99 PAPER MONEY • September/October 2005 • Whole No. 239 banks. Even had the banks been able to produce specie to pay the final install- ment, the Treasury did not have sufficient funds to cover the account. The surplus was gone. The distribution of funds to the States was the ultimate rea- son the Treasury had to the issue $10,000,000 of Treasury Notes to cover its normal obligations in 1837. Just what the States did with their windfall would require a great deal of research, and it appears an accurate account would be difficult to find. Even John Jay Knox, writing in 1885, was uncertain how the states treated the deposits: The data for a full investigation of this subject are not at hand, but it is known that the States of Massachusetts, Connecticut, New York, New Jersey, Pennsylvania, Delaware, Maryland, North Carolina, Illinois, Indiana, Kentucky, Ohio, and Missouri appropriated a considerable portion of the income from this fund to the support of public schools; ... In some instances the States used the funds for internal improvements ... And there were other designs on the money. In January, 1861, Secretary of the Treasury John A. Dix wanted to withdraw the deposits from the States, but according to authorities there was no way it could be done. In 1883 and 1884 the States of Arkansas and Virginia petitioned the Secretary of the Treasury under the Act of June 23, 1836, for payment of the fourth install- ment, again without success. When the second $127,445.10 installment of the deposit was received by the State of Rhode Island, a commission appointed by the General Assembly disbursed the funds into deposits in various state banks. Governor John Brown Francis, Secretary Henry Bowen and General Treasurer John Sterne assigned $1,069.66 to The New England Commercial Bank in Newport and received a certificate of deposit bearing five per cent interest dated April 3, 1837, signed by Geo. Bowen, president, and blind sealed with the bank's monogi am on yel- low paper. The certificate was cashed with interest in full on May 27, 1840, and the funds put to some other use for the benefit of the state. While it is believed many of the states disbursed the deposited funds for various uses during nearly century and a half, several carried the deposit accounts into recent time. The Associated Press reported the effect of the release of funds in New Jersey where $764,670.60 was still in the trust fund. New Jersey had withdrawn interest on the account annually and placed it in the general fund or invested it; since 1978 the interest had been transferred to the New Jersey Cash Management Fund. The state bureau of accounting was unable to calculate the total interest which had accumulated over the years but the amount was $47,911 for 1979 and $54,273 for 1980. Officials said the $764,670.90 would be a nice addition to the general fund, but it was a long way from solving New Jersey's fiscal problems. Sources Act of June 23, 1836. Coin World, Sidney, Ohio, Oct. 22, 1980. The Forum, Fargo, N. Dak., May 7, 1981. Hammond, Bray. Banks and Politics in America from the Revolution to the Civil War. Princeton (1957). Knox, John Jay. United States Notes. London (1885). Myers, Margaret G. A Financial History of the United States. New York (1970). Smith, Walter Buckingham. Economic Aspects of The Second Bank of the United States. Cambridge (1953). 395 396 September/October 2005 • Whole No. 239 • PAPER MONEY `8894' Vinegar 1840 $1,000 Bank Notes Not Authentic Richard Giedroyc THIS BANK NOTE LOOKS VINTAGE, BUT IS Avinegar-stained replica. This 1840 Bank of the United States $1,000 bank note shows up in the darndest places. It's the sort of note that makes paper money dealers and advanced collectors collectively shake their heads. There are just so many copies of it out there in the hands of non-collectors and beginners. Everyone seems to have the same story about his note being found in an old chest owned by the family for generations. Each of these notes has the same serial number "8894." The notes encountered with this serial number are crisp and yellowed. They look nice and they look old to anyone who has never handled old paper. These are one of the most commonly encountered replicas in all of numis- matics. The one illustrated is less deceptive than many fakes. At least this replica is printed COPY, but many overlook such small printing in their wild daydreams of found riches. These commonly misunderstood replicas are made through the same process as copies of the Declaration of Independence and the U.S. Constitution, which are sold as souvenirs. In some manner, the paper is dipped in vinegar to ensure it will turn yellow and crisp. Somewhere along the line dur- ing the 1960s, somebody decided this must be what old paper looks like. Any older paper note or book will give you a better idea what old paper looks like after aging and handling. It may stay white or turn shades of gray. It becomes limp with use. It doesn't turn yellow and crispy like a potato chip. The Bank of the United States, which issued the real $1,000 note (as well as a $2,000 and $5,000 denomination), was actually the Third Bank of the United States. The genuine notes were printed by Draper, Toppan, Longacre Co. These are the highest denomination notes issued by the Bank. They represent a staggering amount of money for 1840. At that time, a team worker on the Erie Canal made about $13.50 in wages for a six-day work week ($702 per year). Denominations this high were typically used for bank and business transfers. These Bank of the United States notes of 1840 were to be redeemed at a later date, but the bank failed before that time ("Post" notes such as this issue were posted to be redeemed at later dates). People holding these notes, who were investors in the bank, were stuck with this worthless paper. The bank's closing helped start a financial crisis across the country. The Second Bank of the United States was one of the most influential financial institutions in the world between 1815 and 1832, when President Andrew Jackson and bank president Nicholas Biddle got into a controversy. Jackson vetoed a new charter for the bank and it closed in 1836. The Bank of the United States issuing the $1,000 notes of 1840 was chartered as a banking institution by Pennsylvania. The period following the closing of the sec- ond bank is called the "Free Banking Era." It is a quarter century period in which local and state banks issued their own paper money, all without federal regulation. States, private banks, railroads, stores, and individuals issued their own notes. Some were genuine, others were from bogus banks that never existed, while yet others were counterfeits. A dollar issued by one bank might not be worth a dollar at another bank. This period ended in 1866. The vignettes on the front of the note include the facade of the Third Bank of the United States at center. It was formerly the Second Bank building and later served until 1935 as the Philadelphia Customs House. To the left from top to bottom are vignettes of David Rittenhouse, William Penn and Thomas Paine. To the right from top to bottom are vignettes of Robert Fulton, Benjamin Franklin and Robert Morris. When encountering such notes with serial number "8894" and the tall tales that go with them, just smile and pass on buying the notes. You are invited to visit our web page www.kyzivatcurrency.com For the past 5 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 Springs, IL 60558 E-mail tkyzivat@kyzivatcurrency.com }4 PCDA, SPMC PA.71112 WOW, CD(I =CAS, ITC PAPER MONEY • September/October 2005 • Whole No. 239 397 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. (586) 979-3400 PO Box 2 • Roseville, MI 48066 E-mail: BartlncCor@aol.com Always Wanted Monmouth County, New Jersey Obsoletes - Nationals - Scrip Histories and Memorabilia ,-11/enhurst- Allentown - Asbuly Path - Atlantic Highlands - Belmar Bradley Beach - Eatontown - Englishtown - Freehold - Howell Keansburg - Keyport - Long- Branch - Manasquan - Motown!' Middletown - Ocean Grove - Red Bank - Sea Bright - Spring Lake N.B. Buckman P.O. Box 608, Ocean Grove, NJ 07756 800-533-6163 Fax: 732-282-2525 NBUCKMAN@OPTONLINE.NET WANTED! Information on W.L. Ormsby and the New York Bank Note Company circa the 1840s-1860s, personal information about Ormsby, examples of his paper money (will buy the bills or would be delighted to correspond and receive copies, and anything else). I am planning to do a monograph on Ormsby. Dave Bowers P.O. Box 539 Wolfeboro Falls, NH 03896 Qdbarchive@metrocast.net 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 398 September/October 2005 • Whole No. 239 • PAPER MONEY Recent Events and Future Possibilities SPMC'S SECOND SYMPOSIUM ON PUBLISHING, held at the Memphis International Paper Money Show June 17, was well attended, and the audience was rewarded with some very good presentations. The emphasis this year was more on what and why rather than how. Thanks to pre- senters Tom Carson, Pierre Fricke, Gene Hessler, Arthur Friedberg, Fred Reed, Dennis Schafleutzel, and Wendell Wolka and to all the enthusiastic people who attended. Look for the publishing symposium to become an annual event, probably to be scheduled for the Friday afternoon of the Memphis show. Have an idea for 2006? Send it to me. I have just returned from the second week of the American Numismatic Association's Summer Seminar of classes held on the campus of Colorado College, adjacent to ANA headquarters. This was my first trip in eight years, and I wonder why I waited so long. I took SPMC member Wendell SPMC Librarian's Notes By Bob Schreiner, Librarian Wolka's introductory class in paper money, and I was privi- leged to teach a couple sections of the class. Wendell, best known for his works in U.S. obsolete paper money, is a great teacher, and he has developed some excellent presentation materials for the class. A highlight was an inside look at the ANA's Beebe collection of U.S. currency thanks to museum curator Douglas Mudd. No one returns from the Summer Seminar disappointed. It's a week of happy immersion in numismatics and rich collegiality with fellow collectors, famous and obscure. Treat yourself. While at the Summer Seminar, I enjoyed becoming re- acquainted with ANA librarian Nancy Green and meeting archivist Jane Colvard. They, like other ANA staff I have met, are very dedicated to helping members make the most of the resources of the ANA. I explored some possible publication projects with them, perhaps with joint SPMC/ANA sponsor- ship. The ANA library has a great collection including rare non-circulating source documents--now free of copyright-- that would interest collectors and inform numismatic researchers. I'll let you know what develops. When SPMC was seeking a new home for our library and having some difficulty identifying a taker, we considered donating it to ANA. I ended up with the job, but now I'm not sure that this was the best decision. If ANA would accept our library, all SPMC members--regardless of status as an ANA member--would gain borrowing privileges for the entire ANA library. The borrowing process and cost recovery that ANA uses are the same as ours. Several organizations have now donated their libraries, including IBNS. It's definitely worth another look. Let me know what you think about this. The library catalog is on the SPMC web, spmc.org . I welcome your thoughts on library, web, and related areas. I can be reached at POB 2331, Chapel Hill, NC 27515-2331, or email to reschreiner@mindspring.com . Now tell us what you REALLY think I just came back from the Memphis paper money show, and I couldn't be more stoked on the future of our hobby. Friends, paper money collecting's "good old" days begin today and lie in our future! And, I'm happy to report, SPMC members are leading the way. For market watchers, all the "leading indicators" are up: • Paper Money Values (see story elsewhere), edited by SPMC member Michele Orzano, will debut shortly after you receive this issue. This slick paper money magazine as much as anything indicates the growth potential of our hobby. When an astute publisher like Amos Press feels this hobby is ready for its own magazine and is willing to put bucks and reputation on the line to pull it off, I for one (as a columnist for Bank Note Reporter, Paper Money and Coin World) say "I salute your efforts." • new book publishing interests represented by McFarland Publications and Whitman Publications are step- ping up currency publications. The former, a respected ref- erence book publisher, has already brought two excelllent books by SPMC members to print (George Tremmel's definitive Counterfeit Curency of the Confederate States of America, and my own Show Me the Money! The Standard Catalog of Motion Picture, Television, Stage and Advertising Prop Money). Under the guidance of President Robert Franklin, Executive Vice President Rhonda Herman and Sales Manager Karl-Heinz Roseman, McFarland is poised to expand its influence and contributions to our hobby. Whitman, an oldline numismatic mainstay, has reemerged as a power player in our hobby, with significant paper money works such as A Guide Book of United States Paper Money (see related story elsewhere) and more planned. Under the lead- ership of SPMC member President Mary Counts, Publisher Dennis Tucker, Numismatic Director SPMC member Dave Bowers, and Director of New Business Development SPMC member Clifford Mishler, the future looks great. • our own fabulously successful SPMC author's forum at the show (see separate story) which featured a robust group of publishing pros and Society members: Confederate currency author Pierre Fricke's book will be the most impor- tant CSA work in the last 90 years. Gene Hessler, the out- standing American paper money scholar of our generation. Wendell Wolka, author of our Wismer "Book of the Year" award, whose Ohio book sets a new standard in state paper money catalogs. Art Friedberg, who with brother Ira, own and are expanding the most successful and profitable paper money cataloging system. Electronic book visionaries, including our own SPMC Librarian Bob Schreiner, Dennis ••IIMPYP- min i! 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 PAPER MONEY • September/October 2005 • Whole No. 239 399 Schafluetzel/Tom Carson who are pioneering new technologi- cal frontiers of infomation presentation. And yours truly, who was happy to be among such an illustrious group. • monstrous and monumental auctions by traditional powerhouses such as R.M. Smythe, Lyn Knight and Heritage/CAA as well as others. At the Memphis auction I had to bid three times the generous catalog estimate of a thou- sand bucks to outduel a committed dealer on a rare obsolete for my collection. Remember, it's not just the notes that you need that are escalating in value, it's all those notes you have stashed away over the years. • our SPMC 6000 "Re-building a great Society for a new century" ('-"' program to improve member services, give mem- bers more bang for their buck, and grow membership. Look at the magazine in your hands. Membership Director Frank Clark reported at Memphis that for the first time in years, our Society is growing in numbers once again (see related story). • reliable surveys indicate at least 30,000 serious paper money collectors exist today and their numbers are growing every day. If our Society attracted just 10% of that group our membership would nearly double to 3,000, which would mean even more benefits for ALL members. • new security concious currency designs by the U.S. and virtually EVERY country around the globe attract the public's attention to the new bills as well as the notes these attractive new bills are replacing. SPMC should unquestionably attract one-in-ten of these new paper money fans, too. In recent months we've placed several of our attractive new recruiting brochures in the hands of EVERY member. Don't let them go to waste. Put them into the hands of friends, colleagues, neighbors, family members and encourage them to join you in SPMC. Better yet sign them up and give them a gift membership, something they'll really enjoy when the striped tie or sweater gets hung in the back of the closet. Wanted inCforEmaRtioAn oTn ChMoppOedNupEmoYney. RARE, FREE MASCERATED POSTCARD FOR USEFUL INFORMATION Who made the items, where sold, and anything of interest. Also I am a buyer of these items. Top Prices paid. Bertram M. Cohen, 169 Marlborough St., Boston, MA 02116-1830 E-mail: Marblebert@aol.com A N A HEAD If you want YOUR ad to appear in the next issue of Paper Money, don't wait; make arrangements now. Non-contract ads run on a space available basis; don't be left out in the cold! r Have a Question?--clip and save I If you have a question about the Society, contact the appropriate I I officer for help. Please include a self-addressed, stamped enve- I I lope (SASE) with your inquiry. Correspondence sent without this courtesy cannot be answered. Or you may inquire via e-mail. ▪ Postal addresses are listed on page 322. I• Application for membership: Frank Clark or frank_clark@spmc.org ▪ • Status of membership, address change , non-receipt of magazine, or about the library or the SPMC web site: I Bob Schreiner or bobs@spmc.org I • Inquiries about regional/annual meetings: Judith Murphy or judith@spmc.org I• Matters relating to Paper Money articles or ads: Fred 1 Reed or fred@spmc.org 1. 400 September/October 2005 • Whole No. 239 • PAPER MONEY "...I didn't worry about selling my mother's coin collection. Littleton's reputation is well deserved." R.L., LANCASTER, NH Inherited coins or paper money? Thinking of selling your own collection? For over half a century, thousands of folks just like you have counted on Littleton Coin Company to provide accurate appraisals and the industry's best pricing. We treat you and your collection with the respect you deserve. And as the nation's leading supplier, we buy more and pay more - from single coins to entire collections. So if you're thinking of selling, there's no need to worry. Call the team of experts at Littleton and put our more than 100 years of combined experience to work for you. Call 1-800-581-2646 or E-Mail coinbuy@littletoncoin.com Littleton D11309t. ME38t.FE9u1s0tis Road Coin Company Littleton NH 03561-3735 Fax: 1-877-850-3540 ■ Dun & Bradstreet #01-892-9653 Celebrating 60 Years of Friendly Service www.littletoncoin.com 02005 LCC. Inc. Realize Top Market Price for Your Paper Money! Let Our Success be Your Success! Consign with Bowers and Merena Galleries We offer you the incomparable and very profitable advantage of having your material presented in our superbly illustrated Grand Format catalogue to our worldwide clientele of collectors, investors, museums, dealers, and other bidders. Your paper money will be showcased by the same expert team of cataloguers, photographer, and graphic artists that have produced catalogues for some of the finest collections ever sold. And the presentation of your currency will be supervised by some of the most well-known names in the entire hobby. unsurpassed professional and financial reputation. Over the years we have sold over $350,000,000 of numismatic items and have pleased more than 30,000 consignors. , fill l.I.l It's Easy to Consign! Selling your collection will be a pleasant and financially rewarding experience. From the moment we receive your consignment we will take care of everything: insurance, security, advertising, worldwide promotion, authoritative cataloguing, award-winning photography, and more — all for one low commission rate, plus a buyer's fee. When you do business with Bowers and Merena, you do business with a long-established firm of Just contact Mark Borckardt, our auction director at 800-458-4646 to discuss your consignment. It may well be the most financially rewarding decision you make. Buy Online, Bid Online, Books Online! www.bowersandmerena.com ICU! BOWERS AND MERENA GALLERIES • n • n.n• When great collections are sold... Bowers and Merena sells them! A Division of Collectors Universe NASDAQ: CLCT 1 Sanctuary Blvd., Suite 201, Mandeville, LA 70471 • 800-458-4646 985-626-1210 Fax 985-626-8672 info@bowersandmerena.com • www.bowersandmerena.com on -Omar ...tato; 0 _- — 44.4.a au / timmaicti itage"Villp I ialiremcr•Silmseam . A360 r c4272a.,72,r,zzolocv7r5.Tquiummcs...r.w.,-r,,V7or 1,/.1117111=a7::, HERITAGE CURRENCY AUCTIONS OF AMERICA • -••••••••••••••••••••••••••••• 4011-GAAinPi 111 /, //;////' /11 /4///y/1 4,47,4 9•24Y4/41-/-1 "I/ /4: / y• /. //////, //4/4" ///f/tvawe/lik /11, 44V, ,iriTIVs .100( Mem lie, 4•24.44..01.), • 1,11.11811"ENTISIDSTOTA ROMA 11.1113111. 003KR*).-nuitiattgati HI UPCOMING HCAA SCHEDULE FUN Signature Auction, January 6-7, 2006 CSNS Signature Auction, April 27-29, 2006 Aly 4e4t neoi 1' ,yolly (<11t1'ir1,7, NY Wald to atte;tioP/ gf-0117/1/ ilte leo l'/( - reeo "of kaolerei Allen Minch() Senior Numismatist Ext. 327 AlienM@HentageCurrency.3083 „moo.; IN GOLD -1-17-47-rw•ef Heritage Currency Auctions of America has been smashing world records all year long. We first set a new world record for the largest currency auction ever held ($6.7 million) at FUN 2005. Then our Taylor Family Collection auction in February nearly doubled that record with $12 million in proceeds. HCAA knows how to set records, but we extend the same effort on every note, on every lot. Whether your consignment is valued at $5 thousand or S5 million, we want you to be thrilled with the process and the results. Whether you are selling a few extra notes from your holdings, or a comprehensive collection that took decades to assemble, we have a venue that will maximize your results. Please contact one of our Consignment Directors today to discuss your collection and your needs. Let us bring your currency to our thousands of buyers around the world and on the World-Wide Web. Call 1-800-872-6467 Ext. 222, 24-hour voic email. Visit our website at www.HeritageCurrency.com HERITAGE Senior Numismatist Ext. 390 Len@HentageCurrency.corn Naktionsol avi sot Senior Numismatist Ext. 303 DavidLoHentageCurrencycom Dustin Jo nston Senior Numismatist Ext. 302 Dustin@HeritageCurrency.corn vi Mayfield Senior Numismatist Ext. 277 DavidM@HeritageCurrency.com e ocza a Senior Numismatist Ext. 481 Michael1W4 HeritageCurrency.corn s .C1121IFICATI e Continental Trod s of Government, D DLL 3 in rCy, according to tea) to Jim Fitzgera Senior Numismatist Ext. 348 J imF@HeritageCurrencycom CURRENCY AUCTIONSCTI S OF AMERICA 3500 Maple Avenue, 17th Floor • Dallas, Texas 75219-3941 1-(800-872-6467) • 214-528-3500 • FAX: 214-443-8425 • e-mail: Consign@HeritageCurrency.com Heritage Numismatic Auctions, Inc.: California 3S 3062 16 63, Florida AB 0000665, and Ohio 2001014318. Currency Auctions of America: Florida AB 2218; Illinois 044000217 and Ohio 2001014317. Auctioneers: Leo Frese: Ohio 62199772599, Florida AU 0001059. California 3S 3062 16 64, New York City; Day 1094965, Night 1094966; Samuel Foose: Texas 00011727, California 3S 3062 16 65, North Carolina 7642, Illinois 041000914, Florida AU3244, and New York City; Day 0952360, Night 0952361. Scott Peterson: Texas 00013256, Florida AU3021, and North Carolina #7627: Bob Korver, New York City, Day 1096338 and Night 1096340. 2121PM