Welcome to a series of
commentaries on our forthcoming auctions of the greatest collection of federal
large-size notes to appear on the market in many years. Formed by Joel Anderson
over the course of many years, the collection includes more major rarities by
design types than any other collection ever formed — including the famous Grinnell
and Carter collections.
The Anderson Collection
comprises several hundred notes by design types, Treasury Seal variations, and
other changes. Not only is it comprehensive in that regard, but the grades of
the notes are uniformly high. “Finest known” and “condition census” are the
rule, not the exception. Joel has had an outstanding business career, including
as partner with his brother Charles in the Anderson companies. Years ago in
1963 both of them were on hand at the Treasury Building in Washington, DC
during the great release of long-stored silver dollars. In 2003 they acquired
Whitman Publishing LLC, which has since issued over 300 numismatic titles.
Behind the scenes and
working quietly with Stack’s Bowers Galleries and other leaders in the paper
money field he has studied and carefully acquired the finest of the fine, the
rarest of the rare. One of his multiple $1000 bills, the Grand Watermelon Note,
was the first to ever cross the auction block at one million dollars.
Today it is time for a change,
and these treasures will be presented by us in a series of auctions beginning
in March at our official auction of the Whitman Coin & Collectibles Expo in
Baltimore. The notes will be showcased in fine catalogs and also on the
Internet. The term “once in a lifetime opportunity” could not be more
appropriate than here.
I now give an overview of
the various large-size currency design types:
The first
widely-circulated federal bills were Interest-Bearing Notes issued early in
1861, followed by Demand Notes in the summer. The Civil War had begun in April
after the bombardment of Fort Sumter in the harbor of Charleston, South
Carolina. President Abraham Lincoln, recently inaugurated on March 4,
envisioned the Union would have an easy win over the Confederacy. He called for
men to enlist for a term of three months, by which time the war should be over.
Wrong! The first major
battle was at Bull Run, Manassas, Virginia, not far from the capital of
Washington. In the third week of July it was expected that when the two armies
met, victory would be quick. Wrong again. The Confederate troops won, and in
disarray the Union soldiers scattered and retreated to safety.
In the meantime the
federal Treasury was short of funds needed to fight the war. The two mentioned
issues of 1861 saved the day, at least for the time being. They were redeemable
at face value in gold or silver coins.
By the end of December
1861, the outcome of the war was uncertain. In distant England, a source of
revenue from the sale there of Confederate bonds denominated in British pounds,
many envisioned that the South would triumph. Fear spread, and by January 1862
all gold coins had been withdrawn from circulation. The Union could no longer
issue notes payable in silver and gold, as reserves in the Treasury were very
low. The result was the Legal Tender Act of March 1862, which authorized a
large issue of paper money not payable in gold, but redeemable only in other
such notes. For example, a $20 Legal Tender Note could be exchanged for four $5
notes. Gold coins were tightly held by banks and exchange brokers, and to buy
them it took a premium in Legal Tender notes. At one time later in the war it
took $265 in Legal Tender notes to buy $100 face value in coins.
Thus began a vast
revision of the federal paper money system. The Legal Tender Notes of various
designs continued in use through the end of large-size paper money in 1928.
Other classes of paper
money made over time included Gold Certificates, Silver Certificates, and
Treasury Notes (also called Coin Notes), National Bank Notes, National Gold
Bank Notes, Refunding Certificates, and two types of Federal Reserve Notes,
among others. Large-size currency was issued until 1929, in which year the
transition was made to the smaller size still in use today, although some
small-size currency is of the Series of 1928, as this was the release year
originally planned.
The serious collecting of
large-size notes did not begin until the 20th century. This is curious, as
during the Civil War itself there was great numismatic interest in small
Postage Currency and Fractional Currency bills as well as current Confederate
notes. Early Continental Currency bills and notes issued by the colonies were
popular as well. So far as can be determined, no numismatists saved large-size
currency at the time of issue. Those high-grade examples that exist today were
saved by chance.
Beginning in the early
20th century there were scattered articles about large-size notes in The
Numismatist. In an era without useful reference books several collectors
formed nice holdings, including Virgil M. Brand (most were cashed in for face
value after his death in 1926), Col. E.H.R. Green (many of his notes fell to
pieces after being stored in cellulose-acetate sleeves), and most notably,
Albert A. Grinnell, proprietor of a chain of music stores in the Midwest. His
collection was auctioned in the early 1940s by Barney Bluestone, of Syracuse,
New York, with fewer than a dozen bidders attending a typical sale. Rising into
prominence after then was Amon Carter, Jr., of Fort Worth, Texas, who in time
assembled a magnificent collection — one of the finest ever.
Matters changed
dynamically, in 1953 when United States Paper Money, by Robert
Friedberg, was published. Since then it has appeared in many updated editions.
In time the Society of Paper Money Collectors was formed, a number of dealers
made currency their specialty, and paper money became a very important part of
the numismatic scene, as it remains today. The market is alive, well, and
enthusiastic!
The preceding comments
may be useful in order to understand and appreciate why certain of the
highlight notes in the Joel Anderson are so rare today!
More next week.
Dave Bowers
