Paper Money

Demand note in demand during Heritage auction

The eighth of Heritage Auctions’ sales of the collection of Eric P. Newman was held on Nov. 1 and 2 in Dallas and totaled $1,990,281, including buyer’s fees. The Newman VIII auction offered 688 obsolete notes, as well as a cross section of paper money and financial Americana from Colonial times to 1928.

Currency expert Bruce Hagen of New York City left the auction impressed with the results. He described rare Colonial notes as one of the categories with prices that went “through the roof,” but said there was no doubt that one note, a $10 demand note of 1861 payable at St. Louis, selling at $168,000, eclipsed everything else.

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The note, Friedberg 10 in Paper Money of the United States, is a classic of American currency. Heritage called it exceedingly rare, and with a grade of Very Fine 30 by PCGS Currency, indisputably the finest of the four known. The others are all no better than Very Good. Two of them are in private collections while the third is in the museum of the American Numismatic Association. Newman, now 106, owned this note for 78 years. He bought it for $125 on July 11, 1939, from Pennsylvania dealer David Cassel Wismer, who bought it privately from an unnamed “wealthy Baltimore banker,” according to the catalog.

 Brockage or contact mark? Mike Diamond explains
”Brockage or contact mark? Mike Diamond explains. Also in our Nov. 20 issue, a reader found a fascinating Barber dime that’s over a century old; John Wexler profiled what makes it different.

The $10 denomination has the distinction of being one of the few issues of United States currency to have the portrait of a contemporarily living person, in this case, President Abraham Lincoln. It was not until 1873 that such a portrayal was declared illegal.

The demand notes of 1861 are the first issue of federal paper currency. They were used to finance the Civil War and were one of several categories of paper money created to deal with a shortage of gold and silver coins. In total, $5, $10, and $20 notes were printed, payable in one of five cities — New York, Philadelphia, Boston, Cincinnati, and St. Louis. They were made at the American Bank Note Co. because the Bureau of Engraving and Printing did not yet exist. The notes issued for payment at St. Louis are the scarcest, followed by those for Cincinnati. Heritage notes that only 48,000 notes were printed for St. Louis and that with serial number 47760, the Newman example was one of the last. Of the $60 million in face value issued, less than 1 percent is listed as outstanding on government books, with the rest either redeemed, lost, or destroyed.

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