Thursday, December 27, 2007

Scottish bank notes -- time for a change?

LONDON (Reuters) - Scottish banknotes, widely spurned by shops south of the border, should be legally protected in England, the Liberal Democrats say.

"It is ironic that many shops and businesses in London have signs indicating that they will accept Euros, but at the same time continue to refuse Scottish banknotes," said Shadow Scottish Secretary Alistair Carmichael.

"Scots in England have no legal recourse whatsoever when their banknotes are refused, leading to embarrassment and irritation. This situation is the result of historic accident and it is now time to address it."

Unlike in England, where notes are the monopoly of the central bank, in Scotland they are issued by the three largest private banks, the Bank of Scotland, the Royal bank of Scotland and Clydesdale Bank.

In fact, all Scottish banks are allowed to produce their own notes, provided they were established before 1844 when an Act of Parliament removed the right for new banks to issue notes.

At that time, there were 15 banks in Scotland eligible to issue notes but the number has since dwindled to the big three.

Scottish bank notes are not "legal tender" even in Scotland, meaning anyone owed money can refuse to accept them.

Scottish banks do not produce their own coins, that right being the monopoly of the Royal Mint.

In England and Wales, the last private bank note was issued in 1921 by the Fox, Fowler and Co. bank in Somerset.

The Bank of England declined to comment on the LibDems' call, noting that the status of Scottish notes was a matter for government and parliament.

Thursday, December 6, 2007

The World's Largest Size Banknote

Philippines 100,000 Piso note, measuring 356mm x 216mm (about the size of a legal page), is accredited by the Guinness World Records as the world's largest legal tender note in terms of size.

Front: The "Cry of Pugadlawin", when about 1,000 Filipino patriots led by
Andres Bonifacio gathered in Pugadlawin, on August 23, 1896. They tore up their
Spanish-issued residence certificates and yelled "Long live the Philippines",
signalling the start of a revolt against Spain.

Back: From the balcony of his house in Kawit, Cavite on June 12, 1898, General Emilio Aguinaldo displays the Philippine
flag to the crowd below and proclaims independence from Spain.

Only 1,000 of these notes were issued in 1998 to commemorate the Centennial of Independence from more than 300 years of Spanish colonial rule. The notes were intended for collectors. The initial offering price was 180,000 Piso ($4175), substantially higher than the face value.

The note is legal tender. However, if you want to spend it, it's only worth 100,000 Piso ($2390).

You can view my entire bank note collection at Tom Chao’s Paper Money Gallery

Scans courtesy of Ram Kumar.

Highest Price Paid For A Banknote

A world record of $2,255,000 was paid in December 2006 for an 1890 $1000 United States Treasury note. The note features the portrait of Civil War-era General George Gordon Meade who commanded Union Army troops at the Battle of Gettysburg. The three ornate zeros in the back look like watermelons, thus given the note it's Nickname "Grand Watermelon".

The same note was sold for $1,230 in November 1944. So it has increased more than 1800 times in value. Not a bad investment! If the same $1230 were put in a bank at 5% interest rate, you get only $3875.31 after 23 years.

You can view my entire bank note collection at Tom Chao’s Paper Money Gallery

Monday, December 3, 2007

Lowest Denomination United States Banknote

The lowest denomination ever issued by the United States is the 3 Cents Treasury note. Known as the Fractional Currency, they were used during the Civil War when coins were in short supply. The bank note is about the size of a postage stamp and carries a portrait of George Washington.

You can view my entire bank note collection at Tom Chao’s Paper Money Gallery

Highest Denomination United States Banknote

The highest denomination ever printed by the United States is the $100,000 Gold Certificate. It features the portrait of President Woodrow Wilson (1856-1924), the 28th President of the United States from 1913 to 1921. Only 42,000 of these notes were printed. They were used only for transactions between the Federal Reserve and the Treasury Department. These notes were never issued for public circulation. When the Government stopped using them in the early 1960s, most were destroyed.

You can view my entire bank note collection at Tom Chao’s Paper Money Gallery

The World's Highest Denomination Bank Note

Hungary suffered the worst inflation in modern history immediately after WWII. Before 1945, the highest denomination was 1,000 Pengo. By mid-1946, the highest denomination in circulation was 100 Million B-Pengo (100,000,000,000,000,000,000 Pengo). Banknotes were so worthless that they were actually thrown away as trash.

You can view my entire bank note collection at Tom Chao’s Paper Money Gallery

The World's Oldest Surviving Banknote

I started collecting paper money as a hobby about fifteen years ago. Here are a few facts about paper money that I found very interesting.

Do you know China was the first country to use paper money? Ancient paper money can be traced back to the Pai-Lu P'i-pi (white deer-skin money) of Han Dynasty (140 BC) and the Fei-Chien (flying money) of Tang Dynasty (618 AD).

However, the Ming Dynasty notes issued between 1368 and 1399 are the earliest surviving paper money, of which the 1 Kuan is the most common.

The note is about the size of a legal page. I wonder how people carry that around.

Updated January 26, 2011
Recently a Yuan Dynasty 2 Kuan note has surfaced at an auction which predated the Ming Dynasty 1 Kuan note by several decades. It was sold for Over $180,000

You can view my entire bank note collection at Tom Chao’s Paper Money Gallery