Paper Money

Learning what's what about obsolete notes step by step

A $100 proof for the Union Bank of Philadelphia shows William Penn's Treaty with the Indians.

Image courtesy of Stack's Bowers Galleries.

The following is the first of a three-part Coin World series about collecting obsolete notes following the tenacious yet patient approach exhibited by the late Peter Mayer, prepared by Michele Orzano for the February 2015 monthly edition of Coin World.

Read the last two parts: 

When a collector is tenacious yet patient in the pursuit of a hobby, that approach can be embraced by others who are willing to learn.

One collector who could serve as a mentor to others was the late Peter Mayer, who is recognized as one of the hobby’s leading specialists in obsolete notes.

He pursued obsolete notes with a passion. But not just to acquire and then store them away. He wanted to study the notes, especially the vignettes, to discover the stories they had to tell and then share what he learned with others.

Mayer, 68, died March 8, 2014. He left behind a large trove of proof and issued obsolete notes primarily from the New England states, though he placed an extra emphasis on notes from his home state of New Jersey.

Stack’s Bowers Galleries offered Part I of the Peter Mayer Collection of obsolete note proofs in its Aug. 7, 2014, Rarities Night Auction during the American Numismatic Association World’s Fair of Money in Rosemont, Ill., and Part II was offered in the firm’s Oct. 30, 2014, Winter Baltimore Auction in conjunction with the Whitman Baltimore Expo.

Part III will be offered in March 2015, and that auction will conclude the sales of the 800 to 900 obsolete note proofs from Mayer’s collection.

According to Peter Treglia, director of currency at Stack’s Bowers Galleries, following the March 2015 auction there will be three to five more sales for the signed and issued obsolete notes from Mayer’s collection.

Treglia said he met Mayer “about 11 years ago at one of the early [Herb and Martha] Schingoethe sales. His knowledge and dedication to the hobby was undoubtedly noticed [by anyone] immediately after meeting with him.”

Mayer’s goals were wide-ranging. Treglia said Mayer tried to buy “an example from each bank in Massachusetts, New York and New Jersey.”

First step

First things first: Know what you are pursuing. Obsolete notes were issued in the 18th and 19th centuries by private banks and other businesses, and even by state and local governments. Many private note-issuing banks eventually failed or simply stopped issuing the notes, thus the “obsolete” moniker.

More than 3,000 private banks in 34 states produced 30,000-plus varieties of obsolete notes during the mid-1800s at the height of production.

Beginning in the 1860s obsolete notes began to be replaced in circulation with paper money issued by the federal government.

Know your terminology, too. Obsolete notes are available in several forms: “issued,” meaning they were placed into circulation; “unissued,” meaning printed for circulation but not released; and “proofs,” which are prototypes of a note.

Second step

Decide what state or even vignette you will start looking for and then home in on a specific bank, county, or even a denomination. In that regard, collecting obsolete notes can be very similar to collecting national bank notes, Treglia said.

It is apparent from looking at the notes Mayer collected that he bought notes in the best condition he could afford. It is common to find obsolete notes in less than perfect condition, or what is actually better described as “well-handled.”

A collector must know what is available and realize sometimes the only known examples are in less that perfect condition.

Keep reading about paper money:

Greta Garbo on a note? Sweden recognizes 20th century icons on new series

Always look for ways to expand knowledge and build your collection of obsolete notes

More small-size notes to collect, and many surprising ways to do it, than large-size

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