Rarity, Quality Are Crucial Factors in Paper

Question: My wife and I have been collecting $2 notes (saddlebag notes) because of their large size, circa 1880 to 1917. We’ve tried to buy them in very fine or better condition. We’ve been paying approximately $100 each. Is this a good investment in paper money, or should we look for something else to invest in?--E.E.

Answer: You’ve chosen a very interesting area of numismatics. Many people collect paper bills for their intricate engravings and historical significance. By narrowing it down to $2 bills, you’ve become a specialist in one area of the paper money field, which, like the coin field, is almost limitless. Also, as with coins, condition and rarity are major factors in determining the value of a particular bill.

There is nothing wrong in collecting bills the way you have--except, perhaps, as an investment. If your bills are to serve as an investment, then it’s necessary to apply the same principles that you would to other numismatic items: Buy rarity and quality. Bills graded “very fine or better” probably do not qualify.

Right now, the paper market is going up in rare and quality material in all denominations from 1867 to 1900. Bills graded crisp uncirculated to gem uncirculated are particularly desirable. Notes graded very fine to extra fine are not good investments unless they are rare.

You may be paying a bit of a premium for your bills, which is OK if they’re pleasing and have good eye appeal. If you’re satisfied collecting at this level, then, as they say, enjoy. But if you’d rather go for more investment-quality pieces, you may be able to trade up and have more to show for it financially in the long run.

There are several good basic paper money reference books. These include Paper Money of the United States by Robert Friedberg, the Standard Catalogue of United States Paper Money by Krause and Lemke, and the handy little Official 1990 Blackbook Price Guide of United States Paper Money by Marc Hudgeons.

Coin News

The ever-popular Panda, a low-mintage bullion coin from China, is available for the first time in palladium. The 1989 palladium proof Panda (pictured) has a worldwide mintage of 3,000. Also being released for the third year is the 1989 platinum proof Panda, also with a mintage of 3,000. Both palladium and platinum Pandas feature Beijing’s Temple of Heaven on the obverse. For information on these and other Panda issues, contact PandaAmerica, 23326 Hawthorne Blvd., Suite 150, Torrance 90505; (800) 472-6327.

The impressive catalogue for the Thomas S. Chalkley Collection on the Estate of Austin Ryer sale is now available. Many rarities are featured, including the finest proof Buffalo nickel ever graded, a 1937 Proof-69. There’s also an interesting document section and outstanding half cents and large cents. The six-session auction will be held Sunday through next Wednesday at Superior Galleries, 9478 W. Olympic Blvd., Beverly Hills 90212-4299; (800) 421-0754.

Coin Calendar

Friday, Saturday and Sunday--Four collector groups are combining to present the Golden State Coin Show at the Pasadena Center, 300 E. Green St., from noon to 7 p.m. Friday, 10 a.m. to 6 p.m. Saturday, and 10 a.m. to 4 p.m. Sunday. There are two auctions, one by Bowers and Merena, continuing today and ending Friday; another Saturday by Ponterio and Associates. A meeting of the International Primitive Money Society will be held at 3 p.m. Saturday in Room 314 of the Pasadena Center. Featured is a display of Wife Buying Money.