1875 Series $5 Denominated United States Note
There are a few organizations that are in the business of grading paper currency. Maybe the one of the most recognized is “PMG”, which stands for “Paper Money Guarantee”. This company is very specific about grading paper currency.
This is a fantastically well preserved $5 civil war era bill. It is hard to get paper currency in any better condition than this one. This historical U.S. money sample is graded by at “64 EPQ – Choice Un-circulated”. EPQ stands for “Exceptional Paper Quality”.
If you are into precious metals and understand the monetary system, you will appreciate the following facts:
- “United States Note” means that this bill was emitted directly by the Federal Government. Not as debt, but as issuance of value.
- “Legal Tender” means that this bill is to be accepted as payment in the course of trade
- Absence of precious metal reference. In this bill there is no reference to any precious metal as counter part. It means that there is no equivalent to be redeemed for it. It is just worth $5. A silver certificate, on the other hand, is redeemable in silver
- “Note” means that it is an issuance of debt. So it is not too different from a promissory note. In this case the debtor is the Federal Government.
Paper money, technically known as “Fiat Currency” is money created by government decree. It is useful for trade as long as the government that issued it can guarantee its value. This guarantee is mostly based on the fact that such government pays its debts with it, accept it for tax payments, and enforces the use of such fiat currency in its domain.
As opposed to precious metals, this bill has no intrinsic value. It is just worth whatever a collector is willing to pay. It can no longer be used as legal tender either. So it is not good for trade or paying taxes. In addition, if this bill would still be usable as money, but burn, its value would absolutely disappear. So, other than what a collector is willing to pay for it an artifact, it is worthless.
Any precious metal currency created at same time as this $5 bill is still good. It is still worth its value as precious metal. Gold and Silver coins cant be burned. At best they can be melted and subdivided. Even like that, just as metal, the remains will retain its value as precious metal. There are thousands of uses for gold and silver. Of those, there are hundreds of uses for which there are no substitutes. On top of that, gold and silver can’t be created with a printing press and later made obsolete.