What are Obsolete Banknotes? Bonus 1775 Continental $2

This video provides a general overview of pre-Civil War paper currency commonly referred to today as Obsolete Banknotes. The time period is from 1776-1860 and why paper currency wasn’t liked but definitely needed for commerce and economic reasons. Also covered is the beautiful and elegant artwork and elaborate vignettes that make up obsolete banknotes.
But before we begin we have to rewind the clock four score and seven years - one year before the Thirteen colonies united together and declared independence in 1776. According to my currency books non-federal, pre-Civil War U.S. currency, is basically divided into two groups. Colonial banknotes leading up to roughly 1810 and Obsolete currency issued between the War of 1812 and the U.S. Civil War. Sure, there are sub-categories such as Confederate notes and the Republic of Texas - but those locations weren’t part of the United States.
Since the colonization, of what is now the United States, there has always been a shortage of coin or hard money. The second that Europeans set foot in British America there wasn’t enough gold and silver currency; and that would continue through to the 1870s. So, when there was a shortage of coin - which was basically ALL the time - paper currency stepped in and served a purpose. In the pre-industrial revolution era from 1800-1850, with the population and the economy growing at a rapid rate, the lack of circulating currency became acute. There was never enough precious metals to meet demand. And capacity always seemed to be limited even when the U.S. Mint added three branches in 1838 - two of which only minted gold coins. Good, bad, or ugly (pause) paper currency served a need - an ever growing need that coinage simply could not meet.
According to the Harvard Library the first of what could be considered, Federal issuance of paper currency was approved by the Second Continental Congress in 1775 as a way of funding the Revolutionary War. Although this wasn’t the first issue of paper notes in the colonies. The Massachusetts Bay colony had issued its own banknotes in 1690.
Over the course of the Revolutionary War more currency was needed and combined with additional issues of bills of credit being led to widespread inflation. Basically, the right hand didn’t know what the left hand was doing. Remember there was no Department of the Treasury and the U.S. Mint wouldn’t begin operations until 1792. By the war’s conclusion in 1781, the exchange value of the Continental dollar would eventually fall 1000 percent. This gave rise to the phrase ‘not worth a Continental’. Which provides a little foreshadowing.
The front of my 1775 Continental note has the top and bottom borders state The United Colonies with Continental Currency printed on left and right. The center contains the redemption statement entitling the bearer to two Spanish Milled Dollars or the value of gold or silver. The right center depicts grain being threshed by a flail with the Latin saying “Tribe-u-lay-shio Dye-dat” which translates to "Affliction Enriches."
The reverse has various leaf imprints which weren’t just a design element, they were an anti-counterfeiting tactic invented by Benjamin Franklin who was an early supporter of paper currency. The Continental note was printed by Hall & Sellers of Philadelphia, which Franklin was the original owner of the printing company but sold to David Hall in 1766.
Certainly, and rightfully, the framers of the U.S. Constitution were very leery of paper currency because of the failure of the Continental Dollar. The Constitution prohibits states from issuing currency, but it didn’t prohibit States from chartering banks to do so. State-charted banks began springing up across the country in the early 1800s, each issuing their own bank notes. In theory, these notes were redeemable at the issuing bank for their equivalent in gold or silver coins.
However, the reliability of banks varied greatly. The further away the notes were from the issuing bank the less value they carried. And if the bank went under - so did your banknote. Many banks went out of business as a result of three major panics in the first half of the 1800s which greatly diminished people’s trust in paper currency. Panic was the term used then. Today we call it a recession.
Currency, Money, Collecting, Numismatist, Numismatic, Numismatist, History, Dollar, Bank note, Banknote, Hobby, Coin, Gold, Silver, Unites States Money, Bureau of Engraving & Printing, United States Treasury, Paper Currency, Gold Certificate, Silver Certificate, Legal Tender Note, United States Note, National Banknote, Obsolete Banknote, Federal Reserve Note, Federal Reserve Bank Note, National Bank Note, Small Size Bank Notes, U.S. Mint, US Mint, Obsolete Bank note

[@markjohnson9445]

I have collected obsolete bank notes for many years on a small scale. I love them, their history and beauty, They are colorful. I greatly enjoyed your video.🌞 Mark

[@PolarCurrency]

Thanks Mark - Then I believe you will like the next one. Appreciate the kind words.

[@Stuplubakcurrency]

The amount of info, technique, knowledge, and humor is so well balanced. Awesome job! You really do well to explain ( especially to silver stackers) why currency is so important. I have said it in my videos, you can’t use silver as a world currency because there just isn’t enough. Less than 1 ounce per person.

[@PolarCurrency]

Steve - my subtle way of fighting back against "hard currency". Our country would have never survived without paper money - good, bad and ugly. Appreciate the comment, the kind words and support. Thank you sir.

[@TheCoinBoxChannel]

Great video! I always learn something new from watching your videos-- it's actually multiple "somethings"!

[@PolarCurrency]

Thanks Jo - I am just thankful I can walk and chew gum some days.

[@DaveLynchJazzGuitar]

Great video. Well done. Very interesting!! The notes are beautiful. I like Confederate and obsoletes and silver certificates.

[@PolarCurrency]

Thanks for the kind words and Confederates and Silver Certificates are great to collect and massive history.

[@Ontario100]

Outstanding information and great notes! Love the Colonial currency! 😍 👍

[@PolarCurrency]

Thank you Ontario - it gets funner next video.

[@sjones939]

Another great video with stellar Dan Jones stories!!

[@PolarCurrency]

Thanks D1!

[@blkcrypto]

Great information and super high quality video, as always.

[@PolarCurrency]

Thanks and appreciate the kind comment.

[@garypedersen9570]

I always appreciate your history lesson !!! Now, I will look for "DIX" notes !!!

[@PolarCurrency]

Thanks! And a great note to have - I'm still searching!

[@david_1214]

Great job, Really enjoy your videos!

[@PolarCurrency]

Thank you sir - a fun one to put together.

[@4Kollector]

Super entertaining 👍

[@PolarCurrency]

Thanks “4” - means a lot coming from you.

[@collectingonthecheap56353]

Pretty sure that the leaves used on those early Colonial and Continental notes inspired the leafy and botanical borders used on notes to even today with the $1 obverse. As a Minnesotan, it was really fun to see and hear the names of people and towns of Minnesota.

[@PolarCurrency]

That makes sense - never have heard that - but it would explain the connection. Have to research that - thanks and Go Gophers!

[@667hodge]

Ben Franklin began printing at the age of 12 when he worked for his older brother James at the New England Courant.They never got along and Ben ran away when he was like 16 or 17.The last bank to print obsolete currency was thought to be Diamond State Bank in Seaford, Delaware, sometime in February,1866.Theodore Hamm inherited the brewery from Andrew Keller when he died mining for gold in California.I love your narration, you should work for the history channel

[@PolarCurrency]

Thanks JRW3! Thanks for the nice comments and the additional history. The Hamm Family. Their story is a bit intertwined, the kidnapping, etc. are kind of a big deal in my area. And funny you say that I work for my local historical society.

[@silversurfer1986]

Very nice video bud! I too love obsoletes as the collecting potential is endless. Love the polar bear note! That needs to be added to your collection someday ;) The DIX story is such an interesting one. I've heard about most of those myths and like you believe the most likely theory is the Mason-Dixon line. However, it is rad that paper currency has some fantasy towards this. Anyhow, thanks for taking us along my friend!

[@PolarCurrency]

Thanks Silver Surfer - still thinking about the original Red Book - so cool.

[@silversurfer1986]

@@PolarCurrency Been getting all kinds of really neat things in. Can't wait to share! Thanks again for the vid bud!

[@mevenstien]

✨️🙂✨️

[@PolarCurrency]

Thanks!

[@amywaterman-mcintyre]

Thanks for this very informative video. I actually own a Dayton remainder. I had quite a chuckle over your comments about that hairstyle. Yeah, he was a looker alright. 🤡

[@PolarCurrency]

Thanks for the kind words and yeah that Mr. Dayton's hair - it had to have been weird even for the 1850s! What remainder denomination do you have?

[@amywaterman-mcintyre]

@@PolarCurrency I have the 1 dollar remainder.