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Volume 55 No. 5 May 2009

Minutes of the 1084th Meeting

Session I of the 1084th meeting of the Chicago Coin Club was held April 8, 2009 in the Chicago Bar Association Building, 321 S. Plymouth Court, Downtown Chicago. President Jeffrey Rosinia called the meeting to order at 7 PM with 25 members in attendance and 4 guests, Jerry Nelson, Paul Paluch, Lionel Terzi and Zoujun Dai.

The March Minutes printed in the Chatter were approved as published. Treasurer Steve Zitowsky reported February receipts $10,127.00, expenses $787.33 and total income $9,339.77, leaving total assets of $21,977.06 which is in Life Memberships $2,390.00 and Members’ Equity $19,587.06. The Treasurer reported the big increase due to 90th Anniversary medal orders.

Six applications for membership received second reading and all were elected into membership. They were Katherine Lawrence (Texas), Joe Falater (Michigan), Robert Van Ryzin (Wisconsin), Chris Patton (Michigan), Brian Giese (Wisconsin), and Dat Nguyen (Chicago).

First V.P. Lyle Daly introduced the featured speaker, Jerry Nelson from Chicago’s Federal Reserve Bank. Following several questions, V.P. Daly presented Nelson with an engraved speaker’s medal and an ANA Educational Certificate.

First V.P. Lyle Daly introduced the evening’s 14 exhibitors. ERIC SCHMIDT – 2 Walking Liberty half dollars found in rolls, $2 stutter note found in circulation and 4 medieval coins. KURT HYDE - a U.S. $5 gold coin compared to three German notes issued 1918-1923. ANDY PLIOPLYS – financial statements from Bernard L. Madoff. DAVID GUMM – 1842 U.S. large cent N1 R3 AU50. EUGENE FREEMAN – 2009 2£ from British Indian Ocean Territory, a “chickless” 1942 1d from Ireland, 1947 1 kori from India Kutch and 2 ancient coins. MIKE GASVODA – 12 B.C. denarius showing Augustus obv. and Agrippa rev. CARL WOLF – 2 framed chattel mortgages from Indian Territory. WILLIAM BURD – book Pledges of History, a Brief Account of the Collection of Coins Belonging to the Mint of the United States, by William E. DuBois, 1846 with only 140 copies. STEVE ZITOWSKY – 3 coins from Saarland (German) and 2 coins from Griquatown (South Africa). ROBERT WEINSTEIN – 5 coins from Indo-Greek Kingdoms. MARC STACKLER – 4 Revolutionary notes with re-validation stamps. SHARON BLOCKER – 6 10-peso pattern coins from Cuba, and District of Columbia quarter. MARK WIECLAW – The Elongated Collectors 2008 ANA Convention badge, Connie’s Pizza “dough” worth $2 and three ancient coins. ROBERT LEONARD – 6 precious metal coins with test marks.

Under Old Business, the final lead proof of the 90th Anniversary medal showing “Standing Lincoln” was exhibited. The membership unanimously decided to drop the clouds. Carl Wolf reported the mint is on schedule to have medals available for the April 25th CICF meeting and evening banquet. Robert Leonard announced that the ANA Board of Governors officially appointed him General Chairman of the 2011 Chicago Convention. He also reported Brenda Bishop, ANA Convention Coordinator, will attend the Club’s May 13th meeting. She asked for time to explain the different roles members can play with the convention.

Under New Business, it was announced that Central States Numismatic Society will hold their 2011 annual convention in Rosemont and their 2012-2016 in Schaumburg as published in the spring issue of The Centinel.

At 9:30 PM a recess was called with re-adjournment to be called at 1 PM Saturday, April 25th when the Club holds a meeting in conjunction with the Chicago International Coin Fair at the Crown Plaza O’Hare, Rosemont, IL.

. . . . . . .

Session II of the 1084th meeting of the Chicago Coin Club was held April 25, 2009 in conjunction with the Chicago International Coin Fair, Crowne Plaza O’Hare, Rosemont, IL. President Jeffrey Rosinia called the meeting to order at 1 PM with 34 members and 16 guests in attendance.

A motion was made to hold an abbreviated version of regular meeting. Club Past President and ANS Fellow Robert D. Leonard, Jr. introduced the speaker, Elizabeth Hahn, ANS Librarian, who delivered a program on ANS Library, Sicilian History and Early Numismatic Literature. Following a question and answer period, Mr. Leonard presented her with an ANA Educational Certificate and an engraved Club speaker’s medal.

The five membership applications receiving a first reading were Kevin Dailey (Chicago), Daniel Pelc (Iowa), Marc Charles Ricard (Chicago), David Bynum (Chicago) and Zoujun Dai (Chicago).

President Rosinia announced the Club is commemorating their 90th Anniversary. He encouraged members and guests to visit the Club’s table at the show and see the high-relief medals issued in bronze & sterling silver honoring the event and Abraham Lincoln. He also announced reservations are required for the evening’s banquet at the Giannotti Italian Restaurant, Schiller Park.

It was announced that 2009 is the 23rd year the Club issued a unique souvenir educational card for distribution at the CICF. The author of most issues, Robert D. Leonard, spoke briefly on the current issue Cornaline d’Aleppo Trade Beads. Serial no. 1 given to William Burd for the Club’s archives, serial no. 2 was presented to Elizabeth Hahn and no. 3 was presented to the author, Robert D. Leonard.

At 1:50 PM recess was called with re-adjournment to take place at 7:00 PM that evening at Giannotti’s Restaurant.

. . . . . . .

Session III of the 1084th meeting of the Chicago Coin Club was a banquet held April 25, 2009 at Giannotti Italian Restaurant, 4926 N. River Road, Schiller Park, a short distance from the Chicago International Coin Fair, Crowne Plaza O’Hare, Rosemont, IL. President Jeffrey Rosinia called the meeting to order at 7:00 PM with 56 members and guests in attendance.

Following an invocation by Richard Hamilton, the 56 members and guests enjoyed hors d’oeuvres, a salad, a family style dinner and dessert.

The membership applications submitted from Dale Lukanich (Chicago) and Jeffrey A. Amelse (Chicago) received first reading. President Rosinia asked all past Club officers to stand, spoke briefly about how many members work for the benefit of the Chicago Coin Club and called for a round of applause.

President Rosinia then turned the meeting over to the Chairman of the 90th Anniversary Committee, Mark Wieclaw. He introduced the members of the Anniversary Committee and cited each for a particular responsibility they assumed: Kevin & Sharon Blocker — invitations & banquet; William Burd (with the help of Katie DeCosta) — program; Robert Feiler — souvenirs and promotions; Eugene Freeman — medal; Jeffrey Rosinia — proof reading; Elliot Krieter — medal; Marc Stackler — proof reading; Carl Wolf — medal; Steve Zitowsky — treasurer & bookkeeper.

Mark Wieclaw introduced the featured speaker, David Hendin, who delivered a well-received program Economics, History and Money in Judea and Early Christianity. Following several questions, Mark presented him with a CCC 90th Anniversary Medal in bronze, an engraved Club speaker’s medal and an ANA Educational Certificate.

Robert D. Leonard presented a bronze CCC 90th Anniversary Medal to the American Numismatic Society, NY and gave it to Elizabeth Hahn, ANS Librarian, to take back to their offices.

The meeting was adjourned at 9:45 PM.

Respectfully Submitted,
Carl Wolf, Secretary

Speaker’s Wor[l]d
What’s New at the Federal Reserve Bank

presented by Jerry Nelson
to our April 8, 2009 meeting

Jerry Nelson has worked at the Chicago Federal reserve Bank for almost 13 years, currently as one of three public affairs specialists. You might meet him if you visit the Money Museum at the Chicago Fed. The museum hosted about 30,000 visitors in 2008; it is open on business days, from 9am until 4pm, but show up by 3 as it might take an hour to see everything. Every visitor gets a small bag of shredded currency; don’t worry that they will run out, as they shred old money on the premises.

The Federal Reserve buys the paper currency from the Bureau of Engraving and Printing (BEP) at a great price — for the cost of production, which averages 7 cents per bill! The $1 and $2 notes cost only 6 cents apiece because they have no anti-counterfeiting measures. The new higher denominations that use shades of color cost 8.2 cents apiece, and the next series of $100s, to be issued later this year, will cost 9 cents each. The small notes are the least counterfeited; only one counterfeit $2 note was found in circulation since 1862, and only one counterfeter of the $1 notes was ever found. Which made for a great story.

That counterfeiter was found 9 years ago in a small town in southern Illinois. After her husband died in a coal mining accident, she found two very good counterfeit intaglio plates for the $1 notes in his effects. She obtained cotton bond paper, mixed her own ink, printed them by hand, and cut them with a paper cutter. She spent them in town, only at the pharmacy and grocery. People do not examine the singles — she got away with it for fifty years, until caught by the Secret Service when she was 85. The trail started at the St. Louis Fed; the plates were confiscated, she paid a $10,000 fine, and she served less than 3 years of her 10-year sentence. The eight Chicago Fed money machines process 16,000,000 used notes each day, and one of her notes turns up every week.

Nationwide, there are 133 high speed machines that can process 44 notes per second each, catching the counterfeits and destroying the worn currency. By examining the bundle strap, the appropriate bank can be debited. The Chicago Fed found about 32 counterfeits per day in 2008, down from 100 in 2006 and 40 in 2007 due to the new currency design. The Secret Service collects the counterfeits weekly, but about three good notes are sent each year; those get kicked back to the Chicago Fed that then has to credit the bank it had debited. The Chicago Fed keeps digital images of all found counterfeits. The $20 is the most counterfeited denomination domestically, while the $100 is the most counterfeited in the rest of the world.

The machines grade the used currency on a scale of 1 to 16 (pefect); anything less than a 13 is destroyed, totalling $23,000,000 per day system wide. Half of the $1s are shredded, 20% of the $20s, and 10% of the $5s. The BEP has been lengthening the estimated lifetime of the $1s even though the composition is unchanged since 1861; from about 18 months seven years ago, to 20 months five years ago, to 22 months last year. Almost half of the notes printed by the BEP are $1s. Replacing them with dollar coins is hard; Jerry gave a quick summary of the Anthony and Sacajawea dollar coins, ending with how the Treasury, in 2003, sent personnel to Chicago to stand on the Elevated Train platforms during rush hour to give them to commuters — the commuters would not take them. The government could not give money away! Last September, the government of Ecuador bought 2.4 million of them, leaving only 96 million still in the vaults. So what is the solution? The Presidential dollar coins that cost 20 cents apiece. The mint wanted to send $300 million of them quarterly to the Fed. 190 million of the first issue (featuring Washington) were taken by the public. Now on Harrison, the Chicago Fed, through a vending machine in its money museum, unloaded 321 of them on the public last week, a record.

When the Fed orders coins, Congress has to enact legislation to collateralize those coins. When they buy paper currency, they are backed by their portfolio of Treasuries — that is why they are Federal Reserve Notes. As of March 1, $1.125 trillion worth of currency was “out there,” one third of it is in the US, with $292 billion in the vaults of the 12 Federal Reserve Banks and 21 operational branches (half of that amount is in the East Rutherford, New Jersey robotic cash warehouse of the NY Fed, which makes our currency available for foreign countries’ central banks in exchange for the euro, yen, Swiss franc, and the pound sterling.

The foreign demand for our $100s is absolutely overwhelming. After the US, the Russian Federation has more of our currency than any other nation. About 40% of their economy is underground (hiding from the tax collector), so the goverb=nment periodically cancelled the ruble and required the exchange of old for new rubles at a punitive rate. The people use our currency primarily as a store of value, not as a medium of exchange.

The Fed is our third attempt at a central bank. The first bank, from 1791-1811, was run by the federal government which could not manage the money supply. So the second bank was tried with the opposite approach, being run by the private banking industry under a 20-year charter starting in 1816; President Jackson cut them off in 1832. The law for the third bank was passed in 1913, and the 12 banks were each chartered in 1914 as separate private non-profit corporations; they receive no appropriations from Congress. The Fed makes some money from the Treasuries it holds, but more is made on the capital gains from their interventions in the capital markets when attempting to keep short term interest rates near the Fed target rate. Last year, the system had operating expenses of $7.5 billion, and sent $34.5 billion to Washington to keep its non-profit status.

Only 422 banks in the five states of the seventh district own Chicago Fed stock; they send 3% of their capital surplus to the bank which pays them a 6% annual return. The Chicago Fed uses that money to buy Treasuries; system wide, $958 billion in Treasuries were held on September 15, 2008. Since then the balance sheet has ballooned to $2.1 trillion, and contains a lot of interesting things other than Treasuries. It probably will be $3 trillion in the next quarter, and could top out at $4 trillion. This is not just a local occurrence. The global money supply, from 195 sovereign states, doubled in the five months up to March 1, from $32 trillion to $64 trillion.

Addressing collectors, Jerry made sure to cover the large denomination notes, the $500s, $1,000s, $5,000s, and $10,000s.. Last printed in 1945, it took until 1969 to put them all into circulation. Checks have displaced large notes in transactions, and the government realized that the notes were used in many illegal transactions. In 1979, the Treasury ordered the destruction of anything larger than a $100, so the Fed started shredding all that it received. When the Fed stopped in 2002, 353 of the $5,000s were still out there. They stopped shredding after an example sold at auction for $76,000. For the last seven years, the Fed banks send the large notes to the historical archives section of the Treasury. Nationwide in February, 6 $1,000s and 14 $500s were sent to the Treasury. Heirs find them in safe deposit boxes and such, but store clerks will not take anything like that and sometimes not even banks — the Fed receives angry calls from people whose bank refused to take their $1,000 note at face. The big notes typically come from community banks in small towns; everybody in town has known everyone else all their lives, so the banks take the notes and send them to their local Fed bank.

Counterfeiting of the large denominations is an issue, and Jerry explained how most of the notes are intercepted before they reach circulation in the US. North Korean counterfeit $100s? They are out there, some even in the Chicago Fed money museum, but their quality is not great because they did not get their ordered $6 million Swiss printing press, the same kind as used by the BEP. Only four nations do not assist the Secret Service in their anti-counterfeiting efforts. The intaglio press confiscated in 1998 in Naples, Italy was just like the BEP uses; it belonged to the Italian Mafia who had purchased it from the Swiss. Those counterfeits were probabbly the best of all time. For the last two years, the number one producer is the criminal cartel of Johannesburg, South Africa. The best quality comes from Iran, which uses technology we sold to the Shah’s government; it is more profitable to print our currency than their own. The product is wholesaled through various nations and criminal gangs, but only about 4% of the global counterfeit production reaches the US. About 80% of that is nabbed at the port (usually Miami, Los Angeles, or New York). Retailers catch about 90% that gets past the port, and banks catch about 75% of what retailers accepted.

Jerry answered questions on other points, but not all of the details can fit into this article. Be sure to catch his next presentation to our club, and let’s hope it will not be another five years before he returns.

Speaker’s Wor[l]d
Homer’s Thrinakia: The ANS Library, Sicilian History and Early Numismatic Literature

presented by Elizabeth Hahn
to our April 25, 2009 meeting

In Book 12 of the Odyssey, Homer mentions an island, “Thrinakia,” which describes as the home of Helios’ cattle. The island is commonly thought to have been Sicily since the name implies a connection to the number three, and the island is roughly triangular in shape. Elizabeth was drawn to Sicily because it allowed her to study her three main interests: the ancient Greeks, Italian history, and the sea and maritime archaeology. She spent every summer there from 2002 until her appointment, in July 2008, as the Librarian of the American Numismatic Association in New York.

The presentation started with a map of Sicily, with notable Greek, Roman, and more modern sites located. The sites of some offshore shipwrecks were added next, and then was a photograph from space. Much of the history of Sicily is recorded in books, and some of the more interesting of those books, found in the ANS library, were covered after providing a short history of the ANS library.

Now located on the 11th floor of the ANS’ new home with great views of Manhattan, Elizabeth joined the ANS in the middle of the the latest move. Slides of past facilities elicited some fond murmurs from the audience, and were followed by slides from the new facilities which will include small exhibits of items from the library and archives. The current exhibit traces the 150-year history of the library, from a 31-page index to the online catalogue, of over 100,000 items, that is updated every month.

An interest in Sicilian history is very old, partly resulting from the many archaeological sites and partly from the oral histories that extended classical mythology. Archaeology and numismatics have a tendency to concentrate on the Greek periods of Sicilian history, with the other cultures that passed through being clumped under a few general headings. The first printed history of Sicily was published in 1558; it was written by Tommaso Fazello, a Sicilian. The first numismatic books had been printed earlier.

A very early numismatic book was De asse et partibus eius by Bude. It was text about ancient coins; the closest thing to an illustration that we saw was an ornate first letter to start the text. In 1517, Andrea Fulvio’s Illustrum imagines was published. This work contains 204 wodcut portraits claimed to be from ancient coins, but now, a good number of the images are considered not to be from actual coins. The ANS’ Bude is an original, but their Fulvio is not an original — just look at the bright yellow cover.

The 17th century saw the first appearance of works on Sicilian numismatics; Sicilia Numismatica by Filippo Paruta was one of the examples shown by Elizabeth. It covers materials from the ancient Greeks to the contemporary, 163 of the plates cover the ancient Greeks while only 70 plates cover everything after the Greeks. The last work shown by Elizabeth is her favorite at the ANS, Sicula by Jacobus Philippus d’Orville. It is big: 40 cm tall, 29 cm wide, and very thick. It is well illustrated, and the ANS copy has great binding. But what makes it so great is that it is more sunstantive than it is pretty. Over 300 pages are devoted to architecture of ancient sites in Sicily, over 200 pages cover Sicilian numimatics, and the last section covers inscriptions. This work is limited to only ancient sites and history of Sicily.

Elizabeth finished her presentation by answering a few questions about the ANS library. They have sent some works to Google to be added to Google Books, but these are only the first small steps.

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Show and Tell

Items shown at our April 8, 2009 meeting.

  1. Eric Schmidt showed some recently acquired pieces:
  2. What was $5 worth after WW I? Kurt Hyde showed some examples:
  3. Do I have a deal for you! were the opening words by Andy Pliopolys Need steady income for your hobby? How about a safe investment with steady annual returns in excess of 10%? You could if you invested with this company. And then he showed copies of the November, 2008 monthly statement of someone’s account with Madoff Securities. Yes, that Bernard L. Madoff. The 17-page statement listed all trades from that month, as well as positions held at month’s end; $300,000 was the balance of this trust fund, created by her father, which allowed only limited withdrawals. The customer is selling copies of account statements on eBay, and that is where Andy acquired this. The customer’s identifying information has been marked out, so it might be hard to verify that this customer was part of the Ponzi scheme and not just a customer who ran his/her own account with Madoff Securities. There also was a copy of a check for $10,000 from this account, dated December 1, 2008. This check did go through.
  4. David Gumm showed an 1842 US Large Cent grading AU-50. Acquired in Milwaukee last week, this is an example of the N1 variety that has a rarity rating of R3. A depression on the reverse is the result of either a foreign object on the die during striking, or a planchet defect.
  5. Eugene Freeman also has some items from the Milwaukee show:
  6. Mike Gasvoda showed a Roman denarius from 12 BC. Augustus appears on the obverse, while the reverse shows his chosen successor, Agrippa, who never became emperor bacause he died before Augustus.
  7. Carl Wolf showed framed examples of Chattel Mortgages acquired at CPMX. Chattel refers to portable assets (livestock then, mobile homes now), and Carl’s two check sized pieces are from Indian Territory. The $2,000 one, from the Choctow nation in 1901, was for cattle: 40 steers, 15 heifers, 97 cows, and 70 calves. The $1,025 one, from the Cherokee nation in 1907, was for 17 mules and 50 horses.
  8. William Burd showed the 1846 book, Pledges of History — A Brief Account of the Collection of Coins Belonging to the Mint of the United States, by William E. DuBois, assistant assayer of the mint at the time. Only 140 copies were made of this work containing one engraved plate. The book’s chart shows 3,800 coins in the collection, of which 1,000 were ancient or medieval.
  9. Steve Zitowsky showed coins and medals from territories that could legitimately issue coins:
  10. Robert Weinstein showed coins from the ethnic Greeks from Baktria during their occupation of northern India:
  11. Marc Stackler showed four Mexican Revolutionary notes with revalidation stamps. All were issued by the military in large quantities so they are common today, and they were subjected to great counterfeiting. The genuine notes were issued with one seal, with additional stamps added by various offices from various states. The stamps were applied with a rubber stamp, but even stamped, the notes soon were not readily accepted.
  12. Sharon Blocker showed some recent acquisitions:
  13. Mark Wieclaw showed a range of items:
  14. Robert Leonard showed six precious metal coins with test marks:

Our 1085th Meeting

Date:May 13, 2009
Time:7:00 PM
Location:Downtown Chicago
At the Chicago Bar Association, 321 S. Plymouth Court, 3rd floor meeting room. Please remember the security measures at our meeting building: everyone must show their photo-ID and register at the guard’s desk. A few blocks west of the CBA building is the Ceres Restaurant (enter the Board of Trade building from Jackson at LaSalle, then enter the restaurant from the lobby) with standard sandwiches, burgers, and salads for members who want to meet for dinner.
Featured speaker:Brenda Bishop — Hosting an ANA Summer Convention

Be careful for what you wish, for you might just get it. Now that the club will be the host club for ANA in 2011, Brenda, the ANA’s Meeting Services Director (Convention Organizer), will be here to tell us what has changed since we last hosted in 1999, and to listen to our ideas. We will answer her questions, and she will answer our questions. Join Bob Leonard, the convention’s general chairman, as we learn about the available opportunities.

Important Dates

May 13 CCC Meeting - Featured Speaker - Brenda Bishop on Hosting an ANA Summer Convention
June 10 CCC Meeting - Featured Speaker - to be announced
June 26-28 28th Annual MidAmerica Coin Expo at the Renaissance Hotel and Convention Center, 1551 Thoreau Drive, Schaumburg, IL 60173. Admission is $5 for Friday and Saturday; free on Sunday.
June 27 CCC Meeting - (meeting time in the next issue) at the MidAmerica Coin Expo, which is held at the Renaissance Hotel and Convention Center, 1551 Thoreau Drive, Schaumburg, IL. No admission charge for our meeting.
Featured Speaker - to be announced
July 8 CCC Meeting - Featured Speaker - Steve Feller on to be announced

Birthday and Year Joined

June 7 Harlan J. Berk 1995
June 11 Joseph A. Piekarczyk 1991
June 12 Rosalind Ryant 1977
June 13 John Whitfield 2007
June 27 James Simek 1973

Chatter Matter

All correspondence pertaining to Club matters should be addressed to the Secretary and mailed to:

P.O. Box 2301

Club Officers

Jeffrey Rosinia- President
Lyle Daly- First Vice President
Elliot Krieter- Second Vice President
William Burd- Archivist
Directors:Robert Feiler
Eugene Freeman
Marc Stackler
Carl Wolf
Other positions held are:
Carl Wolf- Secretary
Steve Zitowsky- Treasurer
Paul Hybert- Chatter Editor

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