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Currency Glossary
ABOUT UNCIRCULATED (AU) - Also called ALMOST UNCIRCULATED. This is one
light fold in an otherwise unworn note.
ATTRIBUTION - Identifying a note by country, when it was made, who
signed the note, who is portrayed on the design, etc.
BACK - The reverse side of a note, opposite the front.
BANK NOTE - Paper currency issued by a bank, both governmental or
private. However, commonly used synonymously for paper money,
regardless of issued by a bank or not.
BILL - Derived from the American Bill of Exchange, bill is a
colloquialism used for money.
BOGUS NOTE - A Fantasy Note that was never issued as real money.
BORDER - The edge or margin of a note.
BOURSE - The place where dealers of a particular asset gather to buy and
sell.
BROKEN BANK NOTES - A broken or obsolete bank note is one issued from a
defunct or broken bank that is no longer capable of fulfilling its
obligations. Banking failure was especially noticeable in small
town,
ill-managed institutions throughout the 19th century and again during
The Great Depression of the late 1920's and early thirties.
BULLION - Gold or silver historically used as a guarantee or back the
value of paper money.
BUREAU OF ENGRAVING AND PRINTING - The locations of where our currency
is made, Washington, D.C., and Fort Worth, Texas.
CENTER - The middle of a note.
CENTRAL BANK - A National Government bank as opposed to a private or
commercial bank.
CHOICE - Noted as CH, Choice refers to a standard slightly better than
the grade assigned.
COIN NOTE - Also U.S. Treasury Note minted from 1890 to 1891. Redeemable
for gold or silver at the Treasury's option.
COLONIAL CURRENCY - Pre-Revolutionary War American paper currency.
COMMERCIAL BANK - A private bank as opposed to a central or government
bank.
COMPOUND INTEREST NOTE - A note paying face value plus a fixed stated
interest rate that was compounded.
CONDITION - Refers to the state of preservation or grade of a note.
CONTINENTAL CURRENCY - Issued by Continental Congress (1775- 1779) for
the American Revolution.
CONVERTIBILITY - The ability of a note to be converted into something
else, e.g., gold, silver coinage or bullion.
COPY - A facsimile or replica of money that is so obvious that it is not
meant to be construed as counterfeit.
CORNER - A reference to one of the four areas of angulation or corners
of a note.
COUNTERFEIT - Bogus currency that is meant to be passed as real.
CREASE - A permanent line or fold on currency.
CRISP UNCIRCULATED - A new note with no creases, wear or other
defacement.
CURRENCY - Paper money.
CUT CANCEL - A slit in a note made for the purposes of cancellation.
CUT NOTE - An officially quartered note done to create paper fractional
currency during a shortage of small coin change.
DAMAGING THINS - A term denoting a thin point on a note due to excessive
rubbing.
DATE - The year on a note. This often refers to the series and not
the
actual date of minting.
DEMAND NOTE - First issued in 1861, this was the first U.S. Federal
currency made during the Civil War. Also called the greenback.
DEMONETIZATION - The official act of declaring a note to be without
value.
DENOMINATION - The face value of a note.
DESIGN - A term meaning the printed part of a note.
DIE - The metal engraved plate upon which a note is created.
DOUBLE NOTE - Refers to a note printed on the back of a Broken Bank
Note. This was done by the South in the Civil War due to the
shortage
of paper.
EDUCATIONAL NOTES - The design themes on Silver Certificate Notes issued
in 1896.
ENGRAVING - Engraving of currency dies is a reverse process where
grooves are scraped into metal plates by the use of sharp instruments.
Ink was then smeared over the traditional copper plates. With the
excess being removed, only the ink in the groves remained. Pressed
against a sheet of moistened paper, the ink in the groves transferred
across giving a clear impression of the image being sought.
ERROR AND FREAK NOTES - This refers to currency that was made in error
or made imperfect by accident.
EXTREMELY FINE - Noted at either EF or XF, Extremely Fine relates to the
condition of a note usually having either one major crease or three
minor folds.
FACE - The front or obverse of a note.
FACE VALUE - The amount of value printed on a note.
FADING - A note that has lost a degree of color.
FAIR - Very worn
FANTASY NOTE - A bogus bill that was never intended for circulation,
e.g., Monopoly money.
FEDERAL RESERVE BANK - A district or branch bank of the U.S. Federal
Reserve System
FEDERAL RESERVE BANK NOTE - A note issued by a District Bank of the
Federal Reserve System. Federal Reserve Bank Notes, like National
Bank
Notes, were off-set by securities and bonds held by the individual
Federal Reserve Banks. As obligations of the Federal Government,
these
notes were only briefly issued in 1915 and again in 1918.
FEDERAL RESERVE NOTES - Authorized by the Federal reserve Act of
December 23, 1913, Federal Reserve Notes were disseminated through all
twelve Federal Reserve Banks. Easier to carry than bullion, each note
represented gold on deposit with our government and was originally
redeemable in gold at the U.S. Treasury or lawful money (coinage) at the
Federal Reserve Bank. This ceased in 1934 when the owning of gold
bullion was made illegal.
FEDERAL RESERVE SYSTEM - Created in 1913, the Federal Reserve System is
a monetary organization that regulates the creation of U.S. currency.
FIAT MONEY - Money that has no gold or silver backing.
FOLD - A light bend in a note. Not to be confused with a crease.
FORGERY - A fraudulently altered genuine document. Often confused
with
counterfeit.
FOXING - Foxing is a reference to tiny brownish, red dots caused by
infestation of lice that attacked the paper fibers of pre-1890 notes.
FRACTIONAL CURRENCY (1862-1876) - Fractional Currency developed during
the Civil War as an answer to the shortage of currency caused by public
hoarding. Values ranged from 3 to 50 cents and were printed until
1876.
FRAME - The outside border of a note's design.
FRIEDBERG NUMBER (FR#) - The standard reference of currency used
throughout the industry when referring to a specific note.
FRN - Federal Reserve Note.
FRONT - The obverse of a note.
GOLD CERTIFICATES - With the increase of gold in America partially
brought on by the rush of the mid 1800's, this metal became a prevalent
asset for exchange. Due to its weight and difficulty of
storage, the
government decided to store equal amounts of gold balanced with like
values issued in Gold Certificates for public circulation. The first
were made available in 1882 and lasted until 1928. With the
recall of
all gold bullion (not coinage) by the government, in 1933 all
certificates were mandated to be returned to the Treasury Department.
This included even those notes held in the possession of collectors.
This law was reversed in 1964 where Gold Certificates can now be held by
collectors but unfortunately cannot be redeemed for the metal it
represents.
GOOD - An extremely worn note.
GRADE - The state of preservation or condition.
GREENBACK - A slang term for a U.S. Demand Note of 1861 so called
because of the green ink used.
LARGE-SIZE CURRENCY - Generally speaking, large-size currency was the
primary tender issued up until 1928. Collectors and investors alike
cannot but be overwhelmed by the grand beauty and intricacy these
original notes represent. The reduction in size was required both
due
to the difficulty of carrying larger bills as well as for lessened
printing considerations.
NATIONAL BANK NOTES - With the National Banking Act of 1863 during the
Civil War, over 14,000 banks were permitted to issue and circulate their
own currency. Likewise, printing was also done at the U.S.
Government
Printing Office. All designs were similar with only the names of the
banks, state seals, bank signatures and the bank's charter number
creating difference. Every charter bank was given the right to issue
currency up to 90 percent of the value of bonds that it held on deposit
with the government. With a bond deposit equaling the printed
currency,
the National Bank Note gradually became accepted by the general public.
This era lasted until the stock market crash of 1929 which ruined a vast
number of banks and ended the public's confidence in this form of note.
NATIONAL GOLD NOTES - There were two factors that held heavily in the
creation of National Gold Notes which originated exclusively from banks
in California. As the gold rush of the 1840's bought massive amounts
of
this metal out of the ground and into barter, it rapidly found its way
into coinage. California banks being so inundated with both raw gold
and gold coins, it petitioned the government for the authority to issue
Gold Notes that could be substituted for the actual coinage. It was
on
July 12, 1870 that Congress voted giving the right to issue such notes
to nine banks in California and Kidder National Gold Bank in Boston.
However, while Californians rushed to print this yellowtoned paper, no
such effort was ever undertaken by the Boston counterpart.
REFUNDING CERTIFICATES - The Refunding Certificate is a cross-variation
between a bond and a security. Issued by Congressional Act in 1879,
these ten dollar notes could be spent or traded as normal currency while
drawing interest at 4 percent per annum. While continuing until
1907,
the Refunding Certificate served three important functions. First, the
percentage given encouraged saving and thereby lessened the threat of
national inflation. Second, since previous bank failures still
created
mistrust of that system, the Refunding Certificate was a method of
saving that was private and did not rely on the solvency of a local
financial institution. And third, due to uneven distribution of
banks
throughout the U.S., Refunding Certificates served as a savings
instrument for the populace who lived in remote areas.
RIPPLE EFFECT - This is the gentle, wavy appearance that appears due to
moisture absorption or unstable chemicals used in the note's
manufacture.
SERIAL NUMBER - The serial number is a control or tracking device on all
U.S. paper currency. It is located below the left center or above
the
right center on each bill. No two bills are alike and serve not only
as
an aid in counting but as a device to minimize counterfeiting.
SIGNATURES - Beginning in 1861, the signature was originally placed on
bills as a deterrent to counterfeiting and as a symbol of authorization.
The assumption was made that a hand signature was more difficult to copy
than an engraving and could be easily detected. From 1862 to 1923,
two
signers were required, the Treasurer and the Register or those who
signed in their stead.
SILVER CERTIFICATES - As America's economy expanded in the late 1870's
trade demand outpaced the supply of silver coinage. In 1878 the
government authorized Silver Certificates as relief for silver coinage.
Redeemable in silver until June 24, 1968, redemption in all forms was
ended. The notes, while still legal tender are now worth only their
face value.
STAR NOTES - Star Notes refers to those United States Notes, Gold
Certificates and Silver Certificates that have a star or asterisk in
front of the serial number. Federal Reserve Notes and Federal
Reserve
Bank Notes have it at the end of the serial number. The purpose of a Star Note is as a replacement
for a mutilated or unfit issue which must be replaced. To substitute
the damaged note with another of the same serial identification number
would border on the impossible. Star Note substitution represents
the
most practical method where each displaced bill is replaced with a
working counterpart. However, large stars after the serial number on the
1869, 1890 and 1891 series of Treasury Notes do not signify replacement
currency, yet are still referred to as Star Notes.
TREASURY OR COIN NOTES - Begun in 1890 and ended in 1891, Treasury Notes
were authorized by Washington as redeemable paper for silver or gold
coinage. Never attaining popularity, its life was short lived.
UNITED STATES NOTES - Begun on March 10, 1862, United States Notes also
referred to as Legal Tender Notes were the second major variety of U.S.
paper currency. Up until 1923, these five varieties of notes
represented a vast, artistic display of motifs and themes. Denominations
were in the form of $1, $2, $5, $10, $20, $50, $100, $500, $1,000,
$5,000 and $10,000. Not only were the likenesses of presidents
represented, but other government officials as well such as Lewis and
Clark, Salmon P. Chase (Lincoln's Secretary of Treasury), Daniel
Webster, etc.
WILDCAT NOTES - Disreputable con artists of the 1800's often moved from
town to town, normally in the Southwestern part of the United States,
establishing unauthorized or wildcat banks. Issuing their own
currency
without Federal backing, the currency was most often not worth more than
the paper on which it was printed. After taking in sizable deposits,
the owners of the banks fled into the night simply to establish a carbon
copy operation in another location.
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