|Volume 64 No. 11||November 2018|
The 1197th meeting of the Chicago Coin Club was held Wednesday, October 10, 2018 at the Chicago Bar Association Building, 321 S. Plymouth Court, Downtown Chicago. President Rich Lipman called the meeting to order at 6:45 PM with attendance of 24 members and 2 guests: Konrad Jakub Mróz from Shanghai, China and Jeffrey Janis.
The Minutes of September meeting were approved as published in the Chatter. Robert Leonard made a correction to the Show and Tell section published in the October Chatter regarding Bob Feiler’s Arabic counter stamped Maria Theresa thaler. Bob stated this was not intended for West African circulation. Steve Zitowsky delivered the Treasurer’s Report showing September revenue of $490.00 and expenses of $504.25. A motion was passed approving the report.
First V.P. Marc Stackler introduced the evening’s featured speaker, Melissa Gumm, who gave a program Currency Backed by the Gold Standard. Following a question and answer period, Marc presented Melissa with an ANA Educational Certificate and an engraved Club speaker’s medal suspended on a neck ribbon.
Second VP John Riley announced the following exhibitors. MARK WIECLAW: a U.S. star note, an encased U.S. postage stamp, and a square ancient coin. DEVEN KANE: drachm and tetradrachms, a gold coin, a glass weight, and a new auction catalog. ROBERT LEONARD: a gold gulden misidentified as counterfeit. LYLE DALY: badly encrusted coins and medals identifiable after a harsh bath. RICHARD LIPMAN: modern world banknotes. DAVID GUMM: U.S. large cent and Civil War-era store card. DALE LUKANICH: a Netherlands Antilles note and its anti-counterfeiting replacement note. ELLIOTT KRIETER: silver coins and bars. JEFF ROSINIA: items from Virginia City, Nevada.
With guest Konrad Mrós visiting from Shanghai, China, President Lipman presented him with a Club 25th Anniversary Silver Medal showing a bust of Abraham Lincoln which was donated by a Club member.
The meeting was adjourned at 8:53 PM.
Carl F. Wolf, Secretary
by Melissa Gumm,
presented to our October 10, 2018 meeting.
Have you ever looked at a Gold certificate? Read the legend and wondered what “redeemable in Gold on demand” or “certifies that there have been deposited in the Treasury of the United States … Dollars in Gold coin” meant? I have, and these sentences piqued my curiosity and I wanted to understand what these legends mean. How did the United States come to have paper currency that was backed by Gold coin? What is the standard that made this paper for gold concept possible? These are just a few of the questions I hope to answer as I talk about paper currency and gold.
As I read about Gold Certificates both large and small size, 1928 Federal Reserve notes, and National Gold Bank Notes, I found it necessary to have an understanding of what it really meant to be “backed in Gold or Gold Coin”. The first question I want to answer is what was the standard on which backing in Gold was based? The gold standard really isn’t very old, having come about in Great Britain in 1821, prior to which both gold and silver, or silver alone, was a nation’s standard. Under the gold standard, the value of a nation’s unit of money was fixed as a certain amount of gold. In a nation following the silver standard, the value of a nation’s unit of money was fixed as a certain amount of silver.
Until 1873, the United States followed a bimetallic standard, with the value of a dollar expressed as both an amount of gold and as an amount of silver. A difficulty with the bimetallic standard was the valuation of subsidiary silver coins – as the gold value of silver changed, the value of a silver dollar, two half dollars, four quarters, or ten dimes could be more or less than the official gold value of a dollar. When a group of nations used the same metal as a standard, the face values of their money remained exchangeable at a fixed rate. The United States mostly remained on the gold standard until the 1930s, during the Great Depression.
The National Currency Act of 1863 provided the basis for banks to issue paper money, which were known as National Bank Notes. Over 1700 banks were organized by 1870, but none were chartered in California where hard money was preferred. This was due to the large amount of readily available gold pieces, a legacy of the gold produced in California since 1848. An 1870 act amending the Act of 1863 authorized National Gold Banks which could issue currency redeemable in gold coin.
National Gold Bank Notes
A bank did not need $100 in gold coins to issue a $100 gold note – up to 80% of the issued value could be in U.S. Bonds deposited with the U.S. Treasurer. The Kidder National Gold Bank of Boston was the first National Gold Bank authorized by the Act of 1870. None of its notes is available to today’s collector because all were returned for cancellation before ever circulating; the bank liquidated in 1872. The other nine National Gold Banks were located in California, with notes issued from 1871 until 1883; almost $3,500,000 in notes of various denominations from $5 to $1,000 were issued, with more than half of that amount issued out of San Francisco.
The front of a National Gold Bank Note is the same as on the first issues of the National Bank Notes. But these were printed on yellow tinted paper to make them instantly identifiable. The reverse features a black printing of an assortment of gold coins with a face value of $211, prominently featuring an 1871 double eagle; the image’s metallic appearance is due to extremely fine cut lines on the printing plate. The First National Bank of California, the first such bank to be chartered in California, issued notes in denominations from $5 to $1,000.
High on the front of the shown $5 note of this bank is the inscription, “Redeemable in Gold Coin. This Note is secured by Bonds of the United States deposited with the US Treasurer at Washington.” Lower on the front, below the bank’s name, is the inscription “will pay to the Bearer on Demand Five Dollars in Gold Coin.” National Gold Bank Notes are extremely scarce in the low denominations, and extremely rare in the high denominations; the typical condition might be good or fine.
Some references mistakenly say National Gold Banks are exclusively Californian. This might be because of their petitioning Washington to authorize the issuance of Gold notes and to their wasting no time in issuing the notes.
Gold Certificates were issued by the US Treasury from the Civil War to the Great Depression. They were used as part of the gold standard, exchanged for an equal value in gold expressed as a set amount of gold coinage.
The general circulation of Gold Certificates was discontinued in 1933, when it was made illegal to own them in unrestricted amounts. The restrictions were lifted in 1964, allowing them to become highly collectible – but we still cannot exchange them for gold coins. Gold Certificates were initially replaced by Silver Certificates and United States Notes, and then by Federal Reserve Notes which are still in use today.
Gold Certificates were issued in two sizes: large, from 1865 to 1928, and small, from 1928 to 1934. They were initially issued in $20, $100, $500, $1,000, $5,000, and $10,000 denominations, likely used for interbank funds transfer and not pocket change for circulation. Denominations of $10 and $50 were introduced later.
There were a total of ten issues, numbered 1 through 9 and the last issue as Series 1922. The first three issues are considered non-collectible, as they were believed to be used principally for transactions between banks, large commercial transactions by banks, and clearing houses. Most were printed on only the front, they were issued in denominations from $20 to $10,000, and dates were filled in with pen and ink. The $20 and $100 notes are extremely rare, with the higher denominations virtually unknown; only two examples of the $20 1st issues are known. Collectible issues start with the 4th issue, from 1882, which has notes in denominatiuons from $20 to $10,000 – denominations over $100 are extremely rare, practically unknown. Bills of these series featured portraits of US Presidents, a US Senator, a State Governor, a US Treasurer, and a Founding Father of our country and the nation’s financial system. The legend for the obligation to pay in gold on the front of the bill states “This certifies that there have been deposited in the Treasury of the United States (of America), … Dollars in Gold Coin repayable to the bearer on demand.” This issue is denoted as “Department Series” on the front. The back prominently features an American Eagle with United States (without “of America”) above it, and with denomination indicated by large characters. The last issue, Series 1922, had a change in the legend which reads “This certificate is a Legal Tender in the amount thereof, in payment of all debts and dues public and private. Acts of March 14, 1900, as amended and December 24, 1919.”
Modern size Gold Certificates were issued for general circulation from 1929 to 1933; most are dated Series 1928, while a few 1928A $10 notes are thought to have been released. The back side of the Series 1928 notes were printed with green ink, instead of with the orange ink used on the backs of the large sized Gold Certificates. These notes feature the legal tender clause of “This Certificate Is A Legal Tender in the Amount Thereof in Payment of All Debts and Dues Public and Private.” In 1933, Executive Order 6102 and related acts prevented further use of gold and Gold Certificates in general commerce and circulation. Those in possession of these items were required to turn them in to the Federal Reserve Banks in exchange for other currency. The gold and Gold Certificates held by the Federal Reserve Banks were transferred to the Treasury Department by the Gold Reserve Act of January 30, 1934. Among its other sections, the Gold Reserve Act also raised the price of an ounce of gold from $20.67 to $35.00 – a devaluation of the US dollar. The Series 1934 of Gold Certificates were issued by the Treasury, to the Federal Reserve Banks, for the acquired gold; these notes are intended for transfer between banks, and are not for the public. This series includes the $100,000 note featuring Woodrow Wilson on the front.
A 1964 law permittted ownership of Gold Certificates by collectors, but they were still not redeemable for gold coin. The ability for the public to own gold was retored at the end of 1974.
Federal Reserve Notes
These notes were first authorized by the Federal Reserve Act of December 23, 1913. The issuance of these notes has steadily increased since then, and today they comprise 99% of the paper money in circulation. Federal Reserve Notes are an obligation of the United States and until 1968 were secured by Gold Certificates or Gold Certificate credits, in an amount of at least 25% of notes in actual circulation with government securities accounting for the other 75% backing of notes. These notes feature a Green Seal and were first issued, in the current small size, in 1929 with a series dated 1928. Denominations ranged from $1 to $10,000 – notes over $500 were discontinued in 1946 and retired in 1969. Series 1928 notes contain a redemption clause the reads “Redeemable in Gold on Demand at the United States Treasury, or in Gold or Lawful Money at Any Federal Reserve Bank”. The legal tender clause on Series 1934 notes removed the ability to redeem notes for gold.
Current Meaning of Gold Certificate
These are currently used as a way to invest in gold, offering investors a method of holding gold without taking physical possession. Generally issued by individual banks in countries such as Germany and Switzerland. The certificate confirms ownership while a bank holds the metal for the “owner.” This offers liquidity, security, and no concern for storage space. The Perth Mint of Australia offers a similar certificate for the gold program guaranteed by the government of Western Australia.
|CSNS Convention||Chicago Coin Company|
|Harlan J. Berk, Ltd.||Kedzie Koins Inc.|
Items shown at our October 10, 2018 meeting,
reported by John Riley.
October 16, 2018
The first meeting of the 2019 ANA Convention Committee met October 16, 2018 in the offices of Harlan J. Berk, Ltd., 77 W. Washington, 13th Floor, Downtown Chicago. Host Chairman Richard Lipman called the meeting to order at 6:07 PM with Mark Wieclaw, Dale Lukanich, Dale Carlson, John Kent, Aaron Berk, Sharon Blocker, Lyle Daly, Steve Zitowsky, and Carl Wolf in attendance.
Everyone expressed their appreciation and thanks to Aaron Berk, representing Harlan J. Berk, Ltd., for providing the meeting space, dinner, and parking.
Rich announced the ANA confirmed his appointment as Host Chairman and Elliott Krieter as Assistant Host Chairman. ANA Convention Director Jennifer Ackerman will be his main contact.
During an open discussion everyone spoke on how they contributed in previous years and/or expressed their interests in the various committee chairperson positions and on that basis were appointed to the following positions:
General discussions were held on the following topics:
The meeting was adjourned at 7:28 PM.
Carl Wolf, Secretary
Chicago Coin Club
Here are the lots known to us by October 28, 2018. The auction will be held near the start of the meeting, after a short time for lot examination.
Bill Burd Consignment – Chicago Coin Club Medals and Tokens.
Bill Burd Consignment – Chicago Numismatic Society Medals and Tokens.
Saul Needleman Consignment.
Bob Leonard Consignment.
|Date:||December 12, 2018|
|Time:||6:30PM Cocktails (cash bar) and appetizers
7:00PM to 9PM Dinner and Meeting
|Location:||Grand Lux Café, 600 N. Michigan Ave, 2nd Floor (entrance around the corner at 111 E. Ontario St.), Chicago.|
There is a full bar available for early arrivals, before 6:30,
and a private bar from 6:30 to 9:30.
The cost is $60.00 per person, and reservations are required.
Make your reservation either by mail or at our meeting in November.
Pay electronically (see the Chatter Matter page for details) or
make your check payable to Chicago Coin Club,
and either bring it to our November or December meeting,
or mail it to P.O. Box 2301, Chicago, IL 60690.
• Freshly baked bread, freshly brewed coffee, Iced & hot Tea, Signature fresh lemonades, and fountain sodas are included in the pricing. A choice between three appetizers is planned: Beef and Chorizo Empanadas, Bruschetta, or Double Stuffed potato Spring Rolls. A Caesar salad. A choice between three entrees is planned: Miso glazed Salmon with rice and stir fried veggies; Parmesan crusted Pork Chop with mashed potatoes and green beans and carrots; Pasta Milanese (Chicken breast coated with garlic and parmesan bread crumbs) served over spaghettini tossed with tomatoes and lemon butter sauce, garnished with Asparagus and Parmesan. Dessert is either a carrot cake or mixed berries and whipped cream.
• Everyone orders that night, but telling us your entree choice at time of payment would be helpful.
• Please make reservations as early as you can so we can ensure an appropriate space.
|Parking:||Valet parking at 111 E. Ontario (cash); discounted garage parking at 10 E. Ontario as well as at ROW self parking at 50 E. Ontario.|
|Program:||The speaker is not yet announced. See the December Chatter for details.|
Election of Club Officers
|Date:||November 14, 2018 – Annual Member Auction|
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.
You can place a reserve on each lot, and there is no commission
charged to either the buyer or seller. Auction lot viewing will
be held before the meeting starts, and again briefly before the
Please find elsewhere in this issue of the Chatter a listing of all auction lots that were known to us by Sunday, October 28.
Unless stated otherwise, our regular monthly CCC Meeting is in downtown Chicago on the second Wednesday of the month; the starting time is 6:45PM.
|November||14||CCC Meeting - Club Auction - no featured speaker|
|December||12||CCC Meeting - Annual Banquet - Featured Speaker - to be announced|
|January||9||CCC Meeting - Our 1200th meeting - to be celebrated with cocktails and appetizers from 5:30 to 7:00 PM followed by our regular meeting and some special giveaways - Featured Speaker - to be announced|
|February||13||CCC Meeting - Featured Speaker - to be announced|
|March||13||CCC Meeting - Featured Speaker - to be announced|
|March||14-16||PCDA National Currency and Coin Convention at the Hilton Rosemont/Chicago O’Hare, 5550 North River Road, Rosemont, IL. Admission is $5 good from 1pm on Thursday through Saturday. Details at http://www.pcdaonline.com|
|March||16||CCC Meeting - 1pm at the PCDA National Currency and Coin Convention,
which is held at the Hilton Rosemont/Chicago O’Hare, 5550 North River Road, Rosemont, IL.
No admission charge for our meeting.
Featured Speaker - to be announced
|March||28-30||ANA’s National Money Show at the David L. Lawrence Convention Center, Pittsburgh, Pennsylvania. Details at http://www.money.org/NationalMoneyShow|
|April||10||CCC Meeting - Featured Speaker - to be announced|
|April||25-27||80th Anniversary Convention of the Central States Numismatic Society at the Schaumburg Renaissance Hotel & Convention Center, 1551 North Thoreau Drive, Schaumburg, IL. There is a $5 per day admission charge, but admission is free for CSNS Life Members. For details, refer to their website, http://www.centralstates.info/conv.html.|
|April||27||CCC Meeting - 1pm at the CSNS Convention,
which is held at the Schaumburg Convention Center.
No admission charge for our meeting.
Featured Speaker - to be announced
The print version of the Chatter is simply a printout of the Chatter webpage,
with a little cutting and pasting to fill out each print page.
The webpage is available before the Chatter is mailed.
If you would like to receive an email link to the latest issue instead of a mailed print copy, send an email to firstname.lastname@example.org. You can resume receiving a mailed print copy at any time, just by sending another email.
All correspondence pertaining to Club matters
should be addressed to the Secretary and mailed to:
CHICAGO COIN CLUB
P.O. Box 2301
CHICAGO, IL 60690
Payments to the Club, including membership dues, can be addressed to the Treasurer and mailed to the above address.
Renewing Members Annual dues are $20 a year ($10 for Junior, under 18). Annual Membership expires December 31 of the year through which paid. Cash, check, or money order are acceptable (USD only please). We do not accept PayPal. Email your questions to Treasurer.ChicagoCoinClub@GMail.com Members can pay the Club electronically with Zelle™ using their Android or Apple smart phone. JP Morgan Chase customers can send payments to the Club via Quick Pay. To see if your Bank or Credit Union is part of the Zelle™ Payments Network, go to https://www.zellepay.com Please read all rules and requirements carefully.
|Sharing this complete Chatter issue with a friend is simple. Just let them scan this code into their smartphone!|