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Message:: [QUOTE="johnmilton, post: 4266801, member: 101855"]Since many of us are house-bound or at least semi-house-bound, I have decided to dust off some my old articles that I write for my local club and post them here. Since I am going to add a fair number of pictures, it might take a few posts to mount the entire article. It may take me a while to post all of this article, but bear with me.       At our February meeting, someone asked about what people used for small change in the Confederate states during the Civil War. That brought up a longer discussion about what Civil War citizens used, both North and South. At that moment I realized that I had never covered this topic during all of the years that I have given educational presentations to the club. Although I don’t have a large collection of this material, I decided that it might be interesting to cover it this month.       At the beginning of the Civil War, most people on both sides thought the conflict would be short. Northern politicians thought that they could put down the rebellion quickly. Southern Rebels thought that the North would give up without much of a fight and allow them to go their own way. Neither side figured on the determination of Abraham Lincoln to preserve the Union. After the Southern rout of the North at the First Battle of Bull Run in July 1861, and the bloody Union victory at Shiloh in early April 1862, it became obvious that the war was going to be long and difficult.       At first the Union side paid for the war with gold. That policy is reflected by the high mintages, for the period, of 1861 gold coins for most denominations. The South paid for the war with fiat paper money from the beginning. The early Confederate notes stated that they would redeem their paper six months after a peace treaty was signed with the North. Later they extended it to two years. 1861 $5 gold piece [ATTACH=full]1086773[/ATTACH] [ATTACH=full]1086774[/ATTACH] Early Confederate States of America $100 note, variety T-5 [ATTACH=full]1086777[/ATTACH]       As it became obvious that the war would not end any time soon, citizens began to hoard gold coins. By the end of 1861, gold coins had disappeared from circulation. One could acquire gold pieces, but only if you paid a premium, over their face value, in paper money. In the spring of 1862, the Union Government began to issue demand notes that were not backed by silver. Silver coins disappeared from circulation in short order. By mid-summer, people were even hoarding the copper-nickel Flying Eagle and Indian Cents despite the fact that their face value exceeded their melt value. Some merchants offered to pay a 20% premium for cents. In New York City, a building collapsed under the weight of the cents that were stored in it. [ATTACH=full]1086780[/ATTACH] [ATTACH=full]1086781[/ATTACH] "Coppers 20 Pr Ct Premium" [ATTACH=full]1086783[/ATTACH] [ATTACH=full]1086784[/ATTACH]       This left the average citizen with no United States coins to use for their day to day living expenses, which prompted them to seek alternatives. The scope of those alternatives provides the basis for an interesting collection of monetary replacements that the public and private sectors provided. Postage Stamps       One of the early monetary substitutes was postage stamps. These government issued scraps of paper had value and were available in convenient denominations from 1 to 90 cents. In July 1862 the Union Congress passed a bill that allowed stamps to be used as currency. The problems were that they were made of fragile paper and had glue on the back which made the stamps a sticky mess if they come in contact with moisture. Another problem cropped up when people purchased large quantities of stamps which resulted in shortages.       One alternative was to use small pre-printed envelopes which had denominations printed on the outside. These rare pieces came in amounts like 25 or 50 cents. There were two drawbacks to this. First, if the envelope happened to get wet, the stamps could be ruined. Second, it was a good idea to check to see if the envelope really did contain the amount in stamps that was stated on the front.       The most innovative of the “stamps used as money devices” was encased postage. American entrepreneur, John Galt, invented these token-like pieces. They consisted of a two-piece brass frame (front and back) with a window in front that was made of mica, a clear silicon-based mineral. The stamp was folded and encased in the frame with its face value showing. The possible denominations for the stamps were 1, 3, 5, 10, 12, 24, 30 and 90 cents. Most encased postage pieces contain stamps valued at 10 cents or less. Any piece that contains a stamp worth more than 12 cents is rare and might well be a “manufactured rarity” with a replacement stamp inside. An encased postage piece can be opened and re-sealed, but it is very difficult to avoid leaving evidence that its seal has been broken.       Galt made his income by producing encased postage pieces with merchant advertising on the back. Galt charged 20% over the face value of the stamps in his holders and an addition amount for a customer advertising message on the back. This made Galt’s invention more expensive than the other money substitutes. In addition, a shortage of postage stamps limited Galt’s ability to produce his product. For these reasons, the encased postage series was short-lived.       Today all encased postage stamps are scarce, and many of the individual merchant varieties are rare. The Ayer’s medicine company of Lowell, Massachusetts is by far the most common merchant. The best known merchant is Lord & Taylor, whose encased piece is quite scarce. Civil War era postage stamp [ATTACH=full]1086787[/ATTACH] Five cent encased postage piece issued by inventor, John Gault. [ATTACH=full]1086788[/ATTACH] [ATTACH=full]1086789[/ATTACH]  To be continued ...  [/QUOTE]

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