Federal Reserve Note

Last updated

Federal Reserve Notes, also United States banknotes, are the currently issued banknotes of the United States dollar. [1] The United States Bureau of Engraving and Printing produces the notes under the authority of the Federal Reserve Act of 1913 [2] and issues them to the Federal Reserve Banks at the discretion of the Board of Governors of the Federal Reserve System. [2] The Reserve Banks then circulate the notes to their member banks, [3] at which point they become liabilities of the Reserve Banks [4] and obligations of the United States. [2]

Contents

Federal Reserve Notes are legal tender, with the words "this note is legal tender for all debts, public and private" printed on each note. [5] The notes are backed by financial assets that the Federal Reserve Banks pledge as collateral, which are mainly Treasury securities and mortgage agency securities [6] that they purchase on the open market by fiat payment.

History

Prior to centralized banking, each commercial bank issued its own notes. The first institution with responsibilities of a central bank in the U.S. was the First Bank of the United States, chartered in 1791 by Alexander Hamilton. Its charter was not renewed in 1811. In 1816, the Second Bank of the United States was chartered; its charter was not renewed in 1836, after President Andrew Jackson campaigned heavily for its disestablishment. From 1837 to 1862, in the Free Banking Era, there was no formal central bank, and banks issued their own notes again. From 1862 to 1913, a system of national banks was instituted by the 1863 National Banking Act.

United States Note size change from large (gray) to small (green) with plate position letters. Modern Federal Reserve Note (blue) super-imposed on bottom left 1928-size note. United States Note change from large to small size with plate position.svg
United States Note size change from large (gray) to small (green) with plate position letters. Modern Federal Reserve Note (blue) super-imposed on bottom left 1928-size note.

Federal Reserve Notes have been printed from Series 1914 in large-note format, and from Series 1928 in modern-day (small-note) format. The latter dimensions originated from the size of the Philippine peso Silver Certificates issued in 1903 while William Howard Taft served as Philippine governor-general under the United States colonial administration. In view of its highly successful run, President Taft subsequently appointed a committee that reported favorably on the advantages and savings from adopting the dimensions of Philippine notes for use in the United States. [7] Final implementation of today's small-size format, however, only occurred in 1928.

Value

The authority of the Federal Reserve Banks to issue notes comes from the Federal Reserve Act of 1913. Legally, they are liabilities of the Federal Reserve Banks and obligations of the United States government. Although not issued by the United States Treasury, Federal Reserve Notes carry the (engraved) signature of the Treasurer of the United States and the United States Secretary of the Treasury.

At the time of the Federal Reserve's creation, the law provided for notes to be redeemed to the Treasury in gold or "lawful money." The latter category was not explicitly defined, but included United States Notes, National Bank Notes, and certain other notes held by banks to meet reserve requirements, such as clearing certificates. [8] The Emergency Banking Act of 1933 removed the gold obligation and authorized the Treasury to satisfy these redemption demands with current notes of equal face value (effectively making change). Under the Bretton Woods system, although citizens could not legally possess gold (except as rare coins, jewelry, for industrial purposes, etc.), the federal government continued to maintain a stable international gold price. This system ended with the Nixon Shock of 1971. Present-day Federal Reserve Notes are not backed by convertibility to any specific commodity, but only by the collateral assets that Federal Reserve Banks post in order to obtain them. [9]

Production and distribution

A commercial bank that maintains a reserve account with the Federal Reserve can obtain notes from the Federal Reserve Bank in its district whenever it wishes. The bank must pay the face value of the notes by debiting (drawing down) its reserve account. Smaller banks without a reserve account at the Federal Reserve can maintain their reserve accounts at larger "correspondent banks" which themselves maintain reserve accounts with the Federal Reserve. [10]

Federal Reserve Notes are printed by the Bureau of Engraving and Printing (BEP), a bureau of the Department of the Treasury. [11] When Federal Reserve Banks require additional notes for circulation, they must post collateral in the form of direct federal obligations, private bank obligations, or assets purchased through open market operations. [9] If the notes are newly printed, they also pay the BEP for the cost of printing (about 4¢ per note). This differs from the issue of coins, which are purchased for their face value. [10]

A Federal Reserve Bank can retire notes that return from circulation, which entitles it to recover collateral that it posted for an earlier issue. Retired notes in good condition are held in the bank's vault for future issues. [12] Notes in poor condition are destroyed [13] and replacements are ordered from the BEP. The Federal Reserve shreds 7,000 tons of worn out currency each year. [14]

As of 2018, Federal Reserve notes remain, on average, in circulation for the following periods of time: [15]

Denomination$1$2$5$10$20$50$100
Years in circulation6.6no data4.75.37.812.222.9

The Federal Reserve does not publish an average life span for the $2 bill. This is likely due to its treatment as a collector's item by the general public; it is, therefore, not subjected to normal circulation. [16]

Starting with the Series 1996 $100 note, bills $5 and above have a special letter in addition to the prefix letters which range from A to P. The first letter is A for Series 1996, B for Series 1999, C for Series 2001, D for Series 2003, F for Series 2003A, H for Series 2006, K for Series 2006A, L for Series 2009, M for Series 2013, N for Series 2017, and P for Series 2017A. [17]

The Series 2004 $20, the first note in the second redesign, has kept the element of the special double prefix. The first letter is E for Series 2004, G for Series 2004A, I for Series 2006, J for Series 2009, L for Series 2009A, and M for Series 2013. [17]

Federal Reserve Notes are made of 75% cotton and 25% linen fibers, supplied by Crane Currency of Dalton, Massachusetts specifically for that purpose. [18]

Nicknames

U.S. paper currency has had many nicknames and slang terms. The notes themselves are generally referred to as bills (as in "five-dollar bill"). Notes can be referred to by the first or last name of the person on the portrait (George for one dollar, or even more popularly, "Benjamins" for $100 notes).

Criticisms

Security

Despite the relatively late addition of color and other anti-counterfeiting features to U.S. currency, critics hold that it is still a straightforward matter to counterfeit these bills. [20] They point out that the ability to reproduce color images is well within the capabilities of modern color printers, most of which are affordable to many consumers. These critics suggest that the Federal Reserve should incorporate holographic features, as are used in most other major currencies, such as the pound sterling, Canadian dollar and euro banknotes, which are more difficult and expensive to forge. Another robust technology, the polymer banknote, was developed for the Australian dollar and adopted for the New Zealand dollar, Romanian leu, Papua New Guinea kina, Canadian dollar, and other circulating, as well as commemorative, banknotes of a number of other countries. They are said to be more secure, cleaner, and more durable than paper notes, but U.S. banknotes are already designed to be more durable than traditional cotton-based banknotes (they're 25% linen). One major issue with implementing these or any new counterfeiting countermeasures, however, is that (other than under Executive Order 6102 as well as the demonetization of Trade Dollars in 1876 [21] ) the United States has never demonetized or required a mandatory exchange of any existing currency.[ dubious – discuss ] Consequently, would-be counterfeiters can easily circumvent any new security features simply by counterfeiting older designs, although once a new design is launched, the older designs are usually withdrawn from circulation as they cycle through the Federal Reserve Banks.

U.S. currency does, however, bear several anti-counterfeiting features. Two of the most critical anti-counterfeiting features of U.S. currency are the paper and the ink. The ink and paper combine to create a distinct texture, particularly as the currency is circulated. The paper and the ink alone have no effect on the value of the dollar until post print. These characteristics can be hard to duplicate without the proper equipment and materials. Furthermore, recent redesigns of the $5, $10, $20, and $50 notes have added EURion constellation patterns which can be used by scanning software to recognize banknotes and refuse to scan them.

The differing sizes of other nations' banknotes is a security feature that eliminates one form of counterfeiting to which U.S. currency is prone: Counterfeiters can simply bleach the ink off a low-denomination note, such as a $1 or $5 bill, and reprint it as a higher-value note, such as a $100 bill. To counter this, the U.S. government has included in all $5 and higher denominated notes since the 1990 series a security thread, which is a vertical laminate strip imprinted with denomination information. Under ultraviolet light, the security thread fluoresces a different color for each denomination ($5 note: blue; $10 note: orange; $20 note: green; $50 note: yellow; $100 note: red). [22] Additionally the newly designed $100 launched in 2013 has a 3D security ribbon which has proven to be highly resistant to counterfeiting, yet easily understood by the public without special tools or lights.

According to the central banks, the number of counterfeited banknotes seized annually is about 10 in one million real bank notes for the Swiss franc, 50 in one million for the Euro, 100 in one million for United States dollar and 300 in one million for pound sterling (old style). [23]

Differentiation

Critics, such as the American Council of the Blind, note that U.S. bills are relatively hard to tell apart: they use very similar designs, they are printed in the same colors (until the 2003 banknotes, in which a faint secondary color was added), and they are all the same size. The American Council of the Blind has argued [24] that American paper currency design should use increasing sizes according to value or raised or indented features to make the currency more usable by the vision-impaired, since the denominations cannot currently be distinguished from one another non-visually. Use of Braille codes on currency is not considered a desirable solution because these markings would only be useful to people who know how to read Braille, and one Braille symbol can become confused with another if even one bump is rubbed off. Though some blind individuals say that they have no problems keeping track of their currency because they fold their bills in different ways or keep them in different places in their wallets, they nevertheless must rely on sighted people or currency-counting machines to determine the value of each bill before filing it away using the system of their choice. This means that no matter how organized they are, blind people still have to trust sighted people or machines each time they receive U.S. banknotes.

By contrast, other major currencies, such as the pound sterling and euro, feature notes of differing sizes: the size of the note increases with the denomination and different denominations are printed in different, contrasting colors. This is useful not only for the vision-impaired; they nearly eliminate the risk that, for example, someone might fail to notice a high-value note among low-value ones.

Multiple currency sizes were considered for U.S. currency, but makers of vending and change machines successfully argued that implementing such a wide range of sizes would greatly increase the cost and complexity of such machines. Similar arguments were unsuccessfully made in Europe prior to the introduction of multiple note sizes.

Alongside the contrasting colors and increasing sizes, many other countries' currencies contain tactile features missing from U.S. banknotes to assist the blind. For example, Canadian banknotes have a series of raised dots (not Braille) in the upper right corner to indicate denomination. Mexican peso banknotes also have raised patterns of dashed lines. The Indian rupee has raised patterns of different shapes printed for various denominations on the left of the watermark window (20: vertical rectangle; 50: square; 100: triangle; 500: circle; 1,000: diamond).

Lawsuit over U.S. banknote design

Ruling on a lawsuit filed in 2002 ( American Council of the Blind v. Paulson), on November 28, 2006, U.S. District Judge James Robertson ruled that the American bills gave an undue burden to the blind and denied them "meaningful access" to the U.S. currency system. In his ruling, Robertson noted that the United States was the only nation out of 180 issuing paper currency that printed bills that were identical in size and color in all their denominations and that the successful use of such features as varying sizes, raised lettering and tiny perforations used by other nations is evidence that the ordered changes are feasible. [25] [26] The plaintiff's attorney was quoted as saying "It's just frankly unfair that blind people should have to rely on the good faith of people they have never met in knowing whether they've been given the correct change." [27] Government attorneys estimated that the cost of such a change ranges from $75 million in equipment upgrades and $9 million annual expenses for punching holes in bills to $178 million in one-time charges and $50 million annual expenses for printing bills of varying sizes. [27]

Robertson accepted the plaintiff's argument that current practice violates Section 504 of the Rehabilitation Act. [28] The judge ordered the United States Department of the Treasury to begin working on a redesign within 30 days, [24] [29] [30] [31] but the Treasury appealed the decision.

On May 20, 2008, in a 2-to-1 decision, the United States Court of Appeals for the District of Columbia Circuit upheld the earlier ruling, pointing out that the cost estimates were inflated and that the burdens on blind and visually impaired currency users had not been adequately addressed. [32]

On October 3, 2008, on remand from the D.C. Circuit, D.C. District Court Judge Robertson granted the injunction. [33]

As a result of the court's injunction, the Bureau of Engraving and Printing is planning to implement a raised tactile feature in the next redesign of each note, except the $1 bill (which is not allowed to be redesigned, Pub. L. Tooltip Public Law (United States)  114–113 (text) (PDF) , 129  Stat.   2431 , enacted December 18, 2015 [34] [35] ), though the version of the $100 bill already is in progress. It also plans larger, higher-contrast numerals, more color differences, and distribution of currency readers to assist the visually impaired during the transition period. The Bureau received a comprehensive study on accessibility options in July 2009, [36] and solicited public comments from May to August 2010. [37] [38]

The Secretary of the Treasury is charged with the obligation to produce currency and bonds. 31 U.S.C. § 5114. Treasury Department regulations further specify the quality of paper and ink to be used. 31 C.F.R. Part 601. The denominations and design of currency are not further specified by law; for example, the choice of $1, $5, $10, $20, $50, and $100, and the portraits on each, are largely left to the discretion of the Secretary of the Treasury.

There are few requirements set by Congress. The national motto "In God We Trust" must appear on all U.S. currency and coins. [39] Though the motto had periodically appeared on coins since 1865, it did not appear on currency (other than interest-bearing notes in 1861) until a law passed in 1956 required it. [40] It began to appear on Federal Reserve Notes delivered from 1964 to 1966, depending on denomination. [41]

The portraits appearing on the U.S. currency can feature only people who have died, whose names should be included below each of the portraits. [39] Since the standardization of the bills in 1928, the Department of the Treasury has chosen to feature the same portraits on the bills. These portraits were decided upon in 1929 by a committee appointed by the Treasury. Originally, the committee had decided to feature U.S. presidents because they were more familiar to the public than other potential candidates. The Treasury altered this decision, however, to include three statesmen who were also well known to the public: Alexander Hamilton (the first Secretary of the Treasury who appears on the $10 bill), Benjamin Franklin (an early advocate of paper currency who appears on the $100 bill), and Salmon P. Chase (the Secretary of the Treasury who reintroduced national paper currency and appeared on the obsolete $10,000 bill) [42] In 2016, the Treasury announced a number of design changes to the $5, $10 and $20 bills; to be introduced over the next ten years. The redesigns include: [43] [44]

After an unsuccessful attempt in the proposed Legal Tender Modernization Act of 2001, [45] the Omnibus Appropriations Act of 2009 required that none of the funds set aside for either the Treasury or the Bureau of Engraving and Printing may be used to redesign the $1 bill. [46] This is because any change would affect vending machines and the risk of counterfeiting is low for this small denomination. [47] This superseded the Federal Reserve Act (Section 16, Paragraph 8) which gives the Treasury permission to redesign any banknote to prevent counterfeiting. [48]

Series

Notes issued prior to 1928 were 7+7⁄16 by 3+9⁄64 inches (18.9 cm × 8.0 cm). Per the Treasury Department Appropriation Bill of 1929, notes issued after 1928 were to be 6+5⁄16 by 2+11⁄16 inches (16.0 cm × 6.8 cm), which allowed the Treasury Department to produce 12 notes per 16+1⁄4 by 13+1⁄4 inches (41 cm × 34 cm) sheet of paper that previously would yield 8 notes at the old size. [49]

Modern measurements of these large size notes reveal an average dimension of 7+3⁄8 by 3+1⁄8 inches (18.7 cm × 7.9 cm). Small size notes (described as such due to their size relative to the earlier large-size notes) are an average 6+1⁄8 by 2+5⁄8 inches (15.6 cm × 6.7 cm), the size of modern U.S. currency. Each measurement is ± 0.08 inches (2.0 mm) to account for margins and cutting. (Note: differences in size may also involve in historical changes in the definition of the inch.)

Large size notes

Series 1914 FRN were the first of two large-size issues. Denominations were $5, $10, $20, $50, and $100 printed first with a red seal and then continued with a blue seal. [50] Series 1918 notes were issued in $500, $1,000, $5,000, and $10,000 denominations. The latter two denominations exist only in institutional collections. [51] Series 1914 and 1918 notes in the following two tables are from the National Numismatic Collection at the National Museum of American History (Smithsonian Institution).

SeriesDenominationsObligation clause [52]
1914$5, $10, $20, $50, $100"This note is receivable by all national and member banks and Federal Reserve Banks and for all taxes, customs and other public dues. It is redeemable in gold on demand at the Treasury Department of the United States in the city of Washington, District of Columbia or in gold or lawful money at any Federal Reserve Bank."
1918$500, $1,000, $5,000, $10,000

District seals

Series 1914

Denomination type set of 1914 Federal Reserve Notes
ValueFr.Red SealBlue SealPortrait and engraving
$5832a
848		 US-$5-FRN-1914-Fr-832a.jpg US-$5-FRN-1914-Fr-848.jpg Abraham Lincoln
$10894b
919a		 US-$10-FRN-1914-Fr-894b.jpg US-$10-FRN-1914-Fr-919a.jpg Andrew Jackson
$20958a
1010		 US-$20-FRN-1914-Fr-958a.jpg US-$20-FRN-1914-Fr-1010.jpg Grover Cleveland
$501019a
1053		 US-$50-FRN-1914-Fr-1019a.jpg US-$50-FRN-1914-Fr-1053.jpg Ulysses S. Grant
$1001074a
1131		 US-$100-FRN-1914-Fr-1074a.jpg US-$100-FRN-1914-Fr-1131.jpg Benjamin Franklin

Series 1918

Denomination type set of 1918 Federal Reserve Notes
ValueFr.ImagePortrait and engraving
$5001132d US-$500-FRN-1918-Fr-1132d.jpg John Marshall
$1,0001133d US-$1000-FRN-1918-Fr-1133d.jpg Alexander Hamilton
$5,0001134d US-$5000-FRN-1918-Fr-1134d.jpg James Madison
$10,0001135d US-$10000-FRN-1918-Fr-1135d.jpg Salmon P. Chase

Small size notes

SeriesDenominations issuedObligation clauseRemarks
Small portrait notes
1928 $5$10$20$50$100$500, $1,000, $5,000, $10,000"Redeemable in gold on demand at the United States Treasury, or in gold or lawful money at any Federal Reserve Bank"Branch ID in numerals
1934$5$10$20$50$100$500, $1,000, $5,000, $10,000"This note is legal tender for all debts, public and private, and is redeemable in lawful money at the United States Treasury, or at any Federal Reserve Bank"Branch ID in letters; during the Great Depression
1950$5$10$20$50$100Slight design changes: branch logo; placements of signatures, "Series xxxx", and "Washington, D.C.",
1963, 1963A, 1963B, 1969, 1969A, 1969B, 1969C, 1974$1$5$10$20$50$100"This note is legal tender for all debts, public and private"First $1 FRN; "Will pay to the bearer on demand" removed; Seal in Latin replaced by seal in English in 1969 [16]
1976$2First $2 FRN, Bicentennial
1977$1$5$10$20$50$100
1977A$1$5$10$20
1981, 1981A, 1985$1$5$10$20$50$100
1988$1$5$50$100
1988A$1$5$20$50
1990$10$20$50$100
1993$1$5$10$20$50$100
1995$1$2$5$10$20
Large portrait notes ($1 and $2 remain small-portrait)
1996$20$50$100"This note is legal tender for all debts, public and private"
1999$1$5$10$20$100
2001$1$5$10$20$50$100
2003$1$2$5$10$100
2003A$1$2$5$100
2006$5$100
2006A$100
Color notes ($1 and $2 remain small-portrait)
2004$20$50"This note is legal tender for all debts, public and private"
2004A$10$20$50
2006$1$5$10$20$50
2009$1$2$5$10$20$50$100
2009A$100
2013$1$2$5$10$20$50$100
2017$1 [53] $10 [54] $20 [55]
2017A$1 [56] $2 [57] $5$10$20 [58] $50$100
2021$1 [59] $5 [59] $100

Series 1928–1995

Small size notes
ImageValueDescriptionFirst seriesLast series
ObverseReverseObverseReverse
Onedolar2009series.jpg US one dollar bill, reverse, series 2009.jpg $1 George Washington Great Seal of the United States 1963Current (2021)
US $2 bill obverse series 2003 A.jpg US $2 bill reverse series 2003 A.jpg $2 Thomas Jefferson Declaration of Independence by John Trumbull 1976Current (2017A)
Fiver.jpg United States Note (Five Dollars, reverse).jpg $5 Abraham Lincoln Lincoln Memorial 19281995
US $10 1934 Note Front.jpg US $10 1934 Note Back.jpg $10 Alexander Hamilton Treasury Department Building
US-Series-1995-$20-Obverse.jpg 20dollarreverse.jpg $20 Andrew Jackson White House
$50 Dollar Bill Series 1969C Front.jpg $50 Dollar Bill Series 1969C Back.jpg $50 Ulysses S. Grant United States Capitol 1993
US $100 1990 Federal Reserve Note Obverse.jpg US $100 1990 Federal Reserve Note Reverse.jpg $100 Benjamin Franklin Independence Hall
500 USD note; series of 1934; obverse.jpg 500 USD note; series of 1934; reverse.jpg $500 William McKinley "Five Hundred Dollars"1934
1000 USD note; series of 1934; obverse.jpg 1000 USD note; series of 1934; reverse.jpg $1000 Grover Cleveland "One Thousand Dollars"
US $5000 1934 Federal Reserve Note.jpg US $5000 1934 Federal Reserve Note Reverse.jpg $5000 James Madison "Five Thousand Dollars"
10000 USD note; series of 1934; obverse.jpg 10000 USD note; series of 1934; reverse.jpg $10,000 Salmon P. Chase "Ten Thousand Dollars"

Series 1996–2003 (Large portrait notes)

Small size notes
ImageValueDescriptionFirst seriesLast series
ObverseReverseObverseReverse
US $5 series 2003A obverse.jpg US $5 series 2003 reverse.jpg $5 Abraham Lincoln Lincoln Memorial 19992006
US $10 Series 2003 obverse.jpg US $10 Series 2003 reverse.jpg $10 Alexander Hamilton Treasury Department Building 2003
US $20 Series 1996 Obverse.jpg US $20 Series 1996 Reverse.jpg $20 Andrew Jackson White House 19962001
US $50 Series 1996 Obverse.jpg US $50 Series 1996 Reverse.jpg $50 Ulysses S. Grant United States Capitol
Usdollar100front.jpg US $100 series 2006 reverse.jpg $100 Benjamin Franklin Independence Hall 2006A [lower-alpha 1]

Series 2004–present (color notes)

Beginning in 2003, the Federal Reserve introduced a new series of bills, featuring images of national symbols of freedom. The new $20 bill was first issued on October 9, 2003; the new $50 on September 28, 2004; the new $10 bill on March 2, 2006; the new $5 bill on March 13, 2008; the new $100 bill on October 8, 2013. The one and two dollar bills still remain small portrait, unchanged, and not watermarked.

Post-2004 redesigned series
Color series
ImagesValueBack­ground
color		Fluores­cent
strip color		DescriptionFirst seriesDate first issued
ObverseReverseObverseReverseWater­mark
US $5 Series 2006 obverse.jpg US $5 Series 2006 reverse.jpg $5 Purple Blue President Abraham Lincoln;
Great Seal of the United States 		Lincoln Memorial Two water­marks of the number "5"2006March 13, 2008
US10dollarbill-Series 2004A.jpg US $10 Series 2004 reverse.jpg $10 Orange Secretary Alexander Hamilton;
The phrase "We the People" from the United States Constitution;
The torch of the Statue of Liberty 		Treasury Building Alexander Hamilton2004AMarch 2, 2006
US20-front.jpg US20-back.jpg $20 Green President Andrew Jackson;
Eagle 		White House Andrew Jackson2004October 9, 2003
50 USD Series 2004 Note Front.jpg 50 USD Series 2004 Note Back.jpg $50 Pink Yellow President Ulysses S. Grant;
Flag of the United States 		United States Capitol Ulysses S. GrantSeptember 28, 2004
New100front.jpg New100back.jpg $100 Teal Pink Benjamin Franklin;
Declaration of Independence 		Independence Hall Benjamin Franklin2009A [lower-alpha 2] October 8, 2013
These images are to scale at 0.7 pixel per millimetre. For table standards, see the banknote specification table.

See also

Explanatory notes

  1. ↑ The series 2006A was produced from 2011 to 2013 due to issues with the printing process for the colorized (NextGen) $100 notes and to meet the continuing high demand from banks.
  2. ↑ While the series 2009A was the first series of these $100 bills released for circulation, the first printing was series 2009 printed in 2010 and 2011. These were withheld from circulation due to issues with the printing process and none were released until 2016.

Related Research Articles

Seigniorage, also spelled seignorage or seigneurage, is the difference between the value of money and the cost to produce and distribute it. The term can be applied in two ways:

<span class="mw-page-title-main">United States Note</span> Type of paper money that was issued from 1862 to 1971 in the United States

A United States Note, also known as a Legal Tender Note, is a type of paper money that was issued from 1862 to 1971 in the United States. Having been current for 109 years, they were issued for longer than any other form of U.S. paper money. They were known popularly as "greenbacks", a name inherited from the earlier greenbacks, the Demand Notes, that they replaced in 1862. Often termed Legal Tender Notes, they were named United States Notes by the First Legal Tender Act, which authorized them as a form of fiat currency. During the early 1860s the so-called second obligation on the reverse of the notes stated:

This Note is a Legal Tender for all debts public and private except Duties on Imports and Interest on the Public Debt; and is receivable in payment of all loans made to the United States.

<span class="mw-page-title-main">Bureau of Engraving and Printing</span> United States government agency

The Bureau of Engraving and Printing (BEP) is a government agency within the United States Department of the Treasury that designs and produces a variety of security products for the United States government, most notable of which is Federal Reserve Notes for the Federal Reserve, the nation's central bank. In addition to paper currency, the BEP produces Treasury securities; military commissions and award certificates; invitations and admission cards; and many different types of identification cards, forms, and other special security documents for a variety of government agencies. The BEP is one of two U.S. agencies in currency production in the case of printing paper currency; the other is the United States Mint, which mints coinage. With production facilities in Washington, D.C., and Fort Worth, Texas, the Bureau of Engraving and Printing is the largest producer of government security documents in the United States.

<span class="mw-page-title-main">United States five-dollar bill</span> Current denomination of United States currency

The United States five-dollar bill ($5) is a denomination of United States currency. The current $5 bill features U.S. president Abraham Lincoln and the Great Seal of the United States on the front and the Lincoln Memorial on the back. All $5 bills issued today are Federal Reserve Notes. As of December 2018, the average life of a $5 bill in circulation is 4.7 years before it is replaced due to wear. Approximately 6% of all paper currency produced by the U.S. Treasury's Bureau of Engraving and Printing in 2009 were $5 bills.

<span class="mw-page-title-main">United States ten-dollar bill</span> Current denomination of United States currency

The United States ten-dollar bill ($10) is a denomination of U.S. currency. The obverse of the bill features the portrait of Alexander Hamilton, who served as the first U.S. Secretary of the Treasury, two renditions of the torch of the Statue of Liberty, and the words "We the People" from the original engrossed preamble of the United States Constitution. The reverse features the U.S. Treasury Building. All $10 bills issued today are Federal Reserve Notes.

<span class="mw-page-title-main">United States twenty-dollar bill</span> Current denomination of United States currency

The United States twenty-dollar bill ($20) is a denomination of U.S. currency. A portrait of Andrew Jackson, the seventh U.S. president (1829–1837), has been featured on the obverse of the bill since 1928; the White House is featured on the reverse.

<span class="mw-page-title-main">United States fifty-dollar bill</span> Current denomination of United States currency

The United States fifty-dollar bill ($50) is a denomination of United States currency. The 18th U.S. president (1869-1877), Ulysses S. Grant, is featured on the obverse, while the U.S. Capitol is featured on the reverse. All current-issue $50 bills are Federal Reserve Notes.

<span class="mw-page-title-main">United States one-hundred-dollar bill</span> Current denomination of United States currency

The United States one-hundred-dollar bill ($100) is a denomination of United States currency. The first United States Note with this value was issued in 1862 and the Federal Reserve Note version was first produced in 1914. Inventor and U.S. Founding Father Benjamin Franklin has been featured on the obverse of the bill since 1914, which now also contains stylized images of the Declaration of Independence, a quill pen, the Syng inkwell, and the Liberty Bell. The reverse depicts Independence Hall in Philadelphia, which it has featured since 1928.

Large denominations of United States currency greater than $100 were circulated by the United States Treasury until 1969. Since then, U.S. dollar banknotes have been issued in seven denominations: $1, $2, $5, $10, $20, $50, and $100.

<span class="mw-page-title-main">United States one-dollar bill</span> Current denomination of United States paper equivalent of currency

The United States one-dollar bill (US$1), sometimes referred to as a single, has been the lowest value denomination of United States paper currency since the discontinuation of U.S. fractional currency notes in 1876. An image of the first U.S. president (1789–1797), George Washington, based on the Athenaeum Portrait, a 1796 painting by Gilbert Stuart, is currently featured on the obverse, and the Great Seal of the United States is featured on the reverse. The one-dollar bill has the oldest overall design of all U.S. currency currently being produced. The reverse design of the present dollar debuted in 1935, and the obverse in 1963 when it was first issued as a Federal Reserve Note.

<span class="mw-page-title-main">Silver certificate (United States)</span> Paper currency used between 1878 and 1964

Silver certificates are a type of representative money issued between 1878 and 1964 in the United States as part of its circulation of paper currency. They were produced in response to silver agitation by citizens who were angered by the Fourth Coinage Act, which had effectively placed the United States on a gold standard. The certificates were initially redeemable for their face value of silver dollar coins and later in raw silver bullion. Since 1968 they have been redeemable only in Federal Reserve Notes and are thus obsolete, but still valid legal tender at their face value and thus are still an accepted form of currency.

<span class="mw-page-title-main">Gold certificate (United States)</span> Certificate of ownership that gold owners held instead of storing the actual gold

Gold certificates were issued by the United States Treasury as a form of representative money from 1865 to 1933. While the United States observed a gold standard, the certificates offered a more convenient way to pay in gold than the use of coins. General public ownership of gold certificates was outlawed in 1933 and since then they have been available only to the Federal Reserve Banks, with book-entry certificates replacing the paper form.

The history of the United States dollar began with moves by the Founding Fathers of the United States of America to establish a national currency based on the Spanish silver dollar, which had been in use in the North American colonies of the Kingdom of Great Britain for over 100 years prior to the United States Declaration of Independence. The new Congress's Coinage Act of 1792 established the United States dollar as the country's standard unit of money, creating the United States Mint tasked with producing and circulating coinage. Initially defined under a bimetallic standard in terms of a fixed quantity of silver or gold, it formally adopted the gold standard in 1900, and finally eliminated all links to gold in 1971.

<span class="mw-page-title-main">Confederate States dollar</span> Currency of the Confederate States of America

The Confederate States dollar was first issued just before the outbreak of the American Civil War by the newly formed Confederacy. It was not backed by hard assets, but simply by a promise to pay the bearer after the war, on the prospect of Southern victory and independence. As the Civil War progressed and victory for the South seemed less and less likely, its value declined. After the Confederacy's defeat, its money had no value, and individuals and banks lost large sums.

<span class="mw-page-title-main">Educational Series</span>

"Educational Series" is the informal name used by numismatists to refer to a series of United States silver certificates produced by the U.S. Treasury in 1896, after its Bureau of Engraving and Printing chief Claude M. Johnson ordered a new currency design. The notes depict various allegorical motifs and are considered by some numismatists to be the most beautiful monetary designs ever produced by the United States.

<span class="mw-page-title-main">Fractional currency</span> Series of United States dollar banknotes

Fractional currency, also referred to as shinplasters, was introduced by the United States federal government following the outbreak of the Civil War. These low-denomination banknotes of the United States dollar were in use between 21 August 1862 and 15 February 1876, and issued in denominations of 3, 5, 10, 15, 25, and 50 cents across five issuing periods. The complete type set below is part of the National Numismatic Collection, housed at the National Museum of American History, part of the Smithsonian Institution.

This page is a glossary of notaphily. Notaphily is the study of paper money or banknotes.

<span class="mw-page-title-main">Greenback (1860s money)</span> Paper currency issued by the United States during the American Civil War

Greenbacks were emergency paper currency issued by the United States during the American Civil War that were printed in green on the back. They were in two forms: Demand Notes, issued in 1861–1862, and United States Notes, issued in 1862–1865. A form of fiat money, the notes were legal tender for most purposes and carried varying promises of eventual payment in coin but were not backed by existing gold or silver reserves.

A silver certificate is a certificate of ownership that silver owners hold instead of storing the actual silver. Several countries have issued silver certificates, including Cuba, the Netherlands, and the United States. Silver certificates have also been privately issued by various mints and bullion companies. One example was the Liberty Dollar issued by NORFED from 1998 to 2009.

<span class="mw-page-title-main">United States two-dollar bill</span> Current denomination of United States currency

The United States two-dollar bill ($2) is a current denomination of United States currency. A portrait of Thomas Jefferson, the third president of the United States (1801–1809), is featured on the obverse of the note. The reverse features an engraving of John Trumbull's painting Declaration of Independence.

References

Citations

  1. ↑ O'Sullivan, Arthur; Sheffrin, Steven M. (2003). Economics: Principles in Action. Upper Saddle River, N.J.: Pearson Prentice Hall. p. 255. ISBN   0-13-063085-3.
  2. 1 2 3 12 U.S.C.   § 411
  3. ↑ Bryan A. Garner, editor, Black's Law Dictionary 8th ed. (West Group, 2004) ISBN   0-314-15199-0.
  4. ↑ 12 U.S.C.   § 415 Section 415 describes circulating Federal Reserve Notes as liabilities of the issuing Federal Reserve Bank.
  5. ↑ 31 U.S.C.   § 5103
  6. ↑ See weekly H.4.1 reports, "Collateral Held against Federal Reserve Notes"
  7. ↑ Schwarz, John; Lindquist, Scott (September 21, 2009). Standard Guide to Small-Size U.S. Paper Money - 1928-Date. Penguin. ISBN   9781440225789.
  8. ↑ Cross, Ira B. (June 1938). "A Note on Lawful Money". The Journal of Political Economy. 46 (3): 409–413. doi:10.1086/255236. S2CID   153434804.
  9. 1 2 12 U.S.C.   § 412
  10. 1 2 Federal Reserve Bank of New York (April 2007). "How Currency Gets into Circulation" . Retrieved February 17, 2008.
  11. ↑ United States Department of the Treasury. "Organization chart of the Department of the Treasury" (PDF). Archived from the original (PDF) on February 16, 2008. Retrieved February 17, 2008.
  12. ↑ 12 U.S.C.   § 416
  13. ↑ 12 U.S.C.   § 413
  14. ↑ "US Coin Facts". Fleur-de-coin.com. Retrieved February 16, 2018.
  15. ↑ Federal Reserve System (December 2018). "How long is the life span of U.S. paper money?" . Retrieved November 4, 2021.
  16. 1 2 "History of Currency Designs". USPaperMoney.info. Retrieved February 19, 2008.
  17. 1 2 "Details of Serial Numbering". USPaperMoney.info. Retrieved February 16, 2015.
  18. ↑ "The Buck Starts Here: How Money is Made". www.bep.gov. US Department of the Treasury Bureau of Engraving and Printing. Retrieved June 25, 2022.
  19. ↑ "Dead presidents Definition & Meaning - Merriam-Webster".
  20. ↑ "Counterfeit". NewYorker.com. August 28, 2017. Retrieved June 6, 2018.
  21. ↑ United States. Department of the Treasury (July 1, 1915), Information Respecting United States Bonds, Paper Currency and Coin, Production of Precious Metals, Etc.: Revised July 1, 1915, p. 33, retrieved August 23, 2023, Section 2 of the joint resolution of July 22; 1876, recited that the trade dollar should not thereafter be legal tender, and that the Secretary of the Treasury should be authorized to limit the coinage of the same to an amount sufficient to meet the export demand for it.
  22. ↑ "Security Features". The United States Treasury Bureau of Engraving and Printing. Archived from the original on October 27, 2014. Retrieved October 27, 2017.
  23. ↑ Michel Beuret, "Les mystères de la fausse monnaie" Archived October 13, 2013, at the Wayback Machine Allez savoir ! , no. 50, May 2011 (in French).
  24. 1 2 "Judge rules paper money unfair to blind". CNN . November 29, 2006.
  25. ↑ American Council of the Blind v. Paulson, 463F. Supp. 2d51 (D. D.C.2008).
  26. ↑ "Government appeals currency redesign". USA Today . Associated Press. December 13, 2006. Retrieved March 26, 2010.
  27. 1 2 "Judge: Make Money Recognizable to Blind". The Washington Post. November 29, 2006. ISSN   0190-8286 . Retrieved February 3, 2017.
  28. ↑ "AMERICAN COUNCIL OF THE BLIND, et al. v. Henry M. Paulson, Jr., Secretary of the Treasury, Civil Action No. 02-0864 (JR)" (PDF). United States District Court for the District of Columbia. 2002. Archived from the original (PDF) on February 16, 2007. Retrieved February 16, 2018.
  29. ↑ Bridges, Eric, ed. (October 6, 2008). "Court Says Next Gen Currency Must Be Accessible to the Blind" (Press release). American Council of the Blind. Archived from the original on October 22, 2008.
  30. ↑ "Court Says the Blind Will Have Meaningful Access to Currency, Tells Government 'No Unnecessary Delays'". American Council of the Blind. Archived from the original on November 19, 2008. Retrieved November 21, 2008.
  31. ↑ "Federal Court Tells U.S. Treasury Department That It Must Design and Issue Accessible Paper Currency". American Council of the Blind. Archived from the original on November 19, 2008. Retrieved November 21, 2008.
  32. ↑ American Council of the Blind v. Paulson, 525F. 3d1256 (D.C. Cir.2008).
  33. ↑ American Council of the Blind v. Paulson, 581F. Supp. 2d1 (D. D.C.2008).
  34. ↑ "Congressional Research Service Report RS21907" (PDF). WikiLeaks Document Release. August 11, 2004. p. 3 footnote. Retrieved February 16, 2018– via MIT.
  35. ↑ "Administrative Provisions : Department of the Treasury" . Retrieved June 28, 2017.
  36. ↑ "Final Report: Study to Address Options for Enabling the Blind and Visually Impaired Community to Denominate U.S. Currency, July 2009" (PDF).
  37. ↑ 75 FR 28331
  38. ↑ "Meaningful Access to United States Currency for Blind and Visually Impaired Persons". Regulations.gov. TREAS-DO-2010-0003.
  39. 1 2 31 U.S.C.   § 5114
  40. ↑ Public Law 84-140
  41. ↑ "History of 'In God We Trust'". treasury.gov. Retrieved April 29, 2016.
  42. ↑ "U.S. Bureau of Engraving and Printing – FAQ Library". Moneyfactory.gov. Archived from the original on November 25, 2010. Retrieved May 5, 2013.
  43. ↑ Calmes, Jackie (April 20, 2016). "Harriet Tubman Ousts Andrew Jackson in Change for a $20". The New York Times.
  44. ↑ "Anti-slavery activist Harriet Tubman to replace Jackson on $20 bill". usatoday.com. Retrieved April 21, 2016.
  45. ↑ H.R. 2528
  46. ↑ H.R. 1105
  47. ↑ Mimms, Sarah (January 28, 2014). "Why the $1 bill hasn't changed since 1929". Quartz (publication) . Atlantic Media . Retrieved January 28, 2014.
  48. ↑ "FRB: Federal Reserve Act: Section 16". Federalreserve.gov. Retrieved May 5, 2013.
  49. ↑ Treasury Department Appropriation Bill, 1929. U.S. Government Printing Office. 1928. p. 105.
  50. ↑ Friedberg & Friedberg, 2013, p. 148.
  51. ↑ Friedberg & Friedberg, 2013, pp. 157–59.
  52. ↑ "Evolution from Gold to Fiat Money". ecclesia.org. Retrieved February 19, 2008.
  53. ↑ "Series 2017 $1". USPaperMoney.info. Retrieved February 16, 2018.
  54. ↑ "Series 2017 $10". USPaperMoney.info. Retrieved August 5, 2018.
  55. ↑ "Series 2017 $20". USPaperMoney.info. Retrieved August 5, 2018.
  56. ↑ "Series 2017A $1". USPaperMoney.info. Retrieved January 13, 2020.
  57. ↑ "Transition from Series 2017 to 2017A continues at BEP". CoinWorld. Retrieved January 11, 2020.
  58. ↑ "Latest BEP production report reveals Series 2017A notes". CoinWorld. Retrieved September 3, 2019.
  59. 1 2 "Yellen-Malerba Series 2021 notes in production by BEP". CoinWorld. Retrieved June 12, 2023.

General and cited sources

Attribution
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.