Fr. 259-265 Silver Dollar Back Note

U.S. Silver dollars did not circulate much when they were issued in the 19th and early 20th centuries except in vicinity of gaming casinos. Mostly they served as backing for federal paper money, principally Silver Certificates. The Fr. 259-265 Silver Dollar Back Note bears legend to that effect.

Specifications

 * spec 1
 * spec 2
 * spec 3
 * spec 4
 * spec 5
 * spec 6
 * spec 7

Background
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, and 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, and one of the most famous coins in collecting is the so-called “King of U.S. Coins,” the 1804 silver dollar.

But these are the exceptions. Paper substitutes for the bulky coins were the rule.

Notes like the saddle blanket (large size) Fr. 259 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.” Facsimile signatures of Register of the Treasury William S. Rosecrans and Treasurer of the United States. Conrad N. Jordan attest to this obligation.

Thus it’s quite appropriate that five splendid silver dollar images grace the backs of Fr. 259-265, the wonderful and popular Series 1886 $5 Silver Certificates. These are among the most colorful and popular of paper money issues which bear images of the coins they represent.

History
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. Some hobbyists specialize in collecting notes with these coin images. Thus the Silver Dollar Back note is a favorite. 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 U.S., 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 which appear on note backs were historic. Because they bore the motto “In God We Trust” above the eagle, this was the first time this religious phrase appeared on our federal paper money. Its use was made mandatory during the Eisenhower administration following World War II.

Collecting
Series 1886 silver dollar back $5 Silver Certificates were issued in four different signature combinations: Fr. 259 (Rosecrans-Jordan), Fr. 260-261 (Rosecrans-Hyatt), Fr. 262-263 (Rosecrans-Huston) and Fr. 264-265 (Rosecrans-Nebeker). Collectors differentiate varieties by the size, shape and color of the Treasury Seal.

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.

All Series 1886 Silver Dollar Backs have blue serial numbers beginning with the letter “B” and concluding with the symbol |- (a vertical line with a short horizontal line at midsection right). On the Fr. 259 shown the Treasury Seal is red and small. Back is green. All Series 1886 notes have one or more horizontal blue silk security thread(s). On the example shown this can be seen to bisect the center of the note, especially on back.

Collectors will also note at right center the words “Department Series 1886.” This is significant information. Prior to this time, the Treasury shared printing chores for U.S. currency, revenue and other stamps, bonds, checks, etc. with private security printing firms, but the trend was to bring this work “in house,” for economy, and control purposes as the Bureau of Engraving and Printing matured.

When these Series 1886 Silver Certificates were issued it was anticipated the shared work load might continue, and other Silver Certificates would be printed outside the Treasury at least in part. But as you’ll notice the small legend at the bottom of the note’s back reads “Engraved and Printed at the Bureau,Engraving & Printing.” This note was the work of federal workers on the government payroll.

It was not until October 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. Paper money researcher Carlson Chambliss, who co-authored the most recent 7th edition of Hessler’s Comprehensive Catalog of U.S. Paper Money, estimates 1,200 notes are extant.

Although plentiful, examples are not cheap. Very Good prices are about a thousand bucks. Choice Unc. examples book at $8,500 to $14,500 depending on variety. It is generally agreed that the last variety issued, with Rosecans-Nebeker signatures and small red, scalloped Treasury Seal is the scarcest of the seven varieties.