U.S. Coin Price Guide

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Coins on Notes?
By Fred Reed

U.S. silver dollars did not circulate much in the 19th and early 20th centuries. Mostly they served as backing for federal paper money, principally Silver Certificates. Notes bear legends to that effect.

Mostly the dollars sat around in canvas bags in the U.S. Treasury and other federal depositories. A few were kept on hand at most banks so uncle Steve could carry a couple around in his pocket to his Friday night poker game and feel like a big shot, or aunt Dorothy could buy a stocking stuffer for a holiday present for nieces and nephews.

Of course, in the hobby of coin collecting, silver dollars have been a perennial favorite for more than a century. But these are the exceptions. Paper substitutes for the bulky coins were the rule.

Notes like the saddle blanket (large size) Fr. 259 reverse shown bear the legend: "This certifies that there have been deposited in the Treasury of the United States Five Silver Dollars payable to the bearer on demand." Thus it's quite appropriate that five splendid silver dollar images grace the backs these wonderful and popular Series 1886 $5 Silver Certificates.

Printing images of coins on notes traces back to the 18th century when virtually identical images appeared on many of the Continental Currency notes and coins authorized by the Continental Congress. In the 19th century many obsolete bank notes and scrip bore images of Spanish "dollars" (ocho reales) and U.S. coins.

The Act of Feb. 28, 1878, authorized Silver Certificates of $10 and up, and the Act of Aug. 4, 1886, added the lower denominations $1, $2 and $5.

The five-spot became the showcase for five contemporary Morgan silver dollars. The central dollar is an obverse of a then current 1886 cartwheel in a central engraved medallion. The entire cartouche contains five coins. Flanking this image are four silver dollar reverses.

Morgan dollars as many readers know were designed by George T. Morgan, an English artist, who studied at the Royal Mint in London. He was recruited by U.S. Mint Director Henry Linderman, and offered a six-month contract at $8/day.

Morgan accepted and immigrated to the United States, sailing from Liverpool in 1876. Coinage commenced in 1878. Morgan was appointed assistant engraver at the Philadelphia Mint in 1880. According to tradition, Anna Williams was his model for the Liberty head profile on the coin's obverse.

The silver dollar reverses that appear on note backs were historic. Because they bore the motto "In God We Trust" above the eagle, this was the first time this particular religious phrase appeared on our federal paper money. Its use was made mandatory during the Eisenhower Administration following World War II.

According to Treasury Department records, nearly 34 million of these $5 certificates were issued, representing approximately 170 million silver dollars. By way of comparison, during the time these notes were issued, approximately 180 million silver dollars were struck.

Notes were issued over a five-year period before a plain back was introduced on the Series 1891 $5 Silver Certificates. The new back had a great deal of open space. It was believed the complex silver dollar back contributed to the ease of their counterfeiting, while this "white space" would make the notes easier to identify as genuine and harder for the felon to copy.

When these notes were issued, the Bureau of Engraving and Printing was in the process of assuming full responsibility for executing U.S. currency. You'll notice the small legend at the bottom of the note's back reads "Engraved and Printed at the Bureau, Engraving & Printing." It was not until Oct. 1, 1887, that the BEP was given the responsibility to print all U.S. currency and securities, and 1894 when it took over printing stamps as well.

Fortunately for collectors, the silver dollar backs are plentiful and readily available in high grades, making them prime candidates for the type collector or collector of coins on notes. Experts estimate 1,200 notes are extant.


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