Sometimes we don’t notice, but there is a distinct disconnect between experiences from decade to decade. For instance, when most of us were little, to see a $100 bill was a major event. As a child, fathoming what was possible to buy with such an amount was mind blowing. Today, kids get $100 bills for everything from birthday gifts to a dislodged tooth under their pillow.
Remarkably, today, the $100 bill is the second most common form of US currency. Seriously. Internationally, there are more $100 bills in circulation (11.5 billion) than even the lowly one-dollar bill. Some speculate it’s because of the rampant drug and other illegal activities. Either way, it certainly underscores how financially coveted the United States is abroad....
If we dial the clock back just over 100 years ago, we find a whole new paradigm of similarities and disconnects. For instance, in 1914, we were on the brink of war in Europe. Insofar as Russia or certain Middle East countries, we’re not far from that now. In 1914, unemployment was four percent – about what it is right now. 1914 also marked the beginning of a US recession. Sound familiar? Our industrial output was also some of the highest in the world. Today, it’s technology that eclipses most other countries – for now.
While wages might have been a comparative pittance, in the nineteen-teens, there was no income tax; no social security tax; and a reasonably healthy balance sheet. Back then, our national debt was about three billion dollars. Today, it’s over $30 trillion.
Then-President Woodrow Wilson wanted nothing to do with World War I. He did everything he could to stay out. Germany sunk the Lusitania killing 128 Americans. Wilson still didn’t want to get in. Germany was so divisive it was covertly pushing for Mexico to invade Texas. Wilson remained impartial. It wasn’t until 1917 that he relented and the US entered the war.
Not surprisingly, romantic and hefty US silver dollars were common in change purses and cash registers. So too for half dollars with their distinctive “clink” sound when dropped on a counter.
Even more enchanting were the often-seen gold coins used in commerce. For those, denominations of $1.00; $2.50; $5.00; $10.00 and the spectacular $20 Double Eagle were common. There was also a $3.00 gold piece created but it was rarely used. Because gold is a pointedly soft metal, and the coins actually were traded in stores, collectors eagerly seek out specimens with little or no wear. Such surviving high-grade examples are worth many times their face value.
Woodrow Wilson died in 1924. While he never ended up on a US coin or circulating US banknote, he did land on the most notable note of all time.
In 1934 and 1935, Wilson’s portrait was chosen to grace the astronomical $100,000 bill. Don’t have one? Don’t feel left out. Over 42,000 of those banknotes were created but none went into actual public circulation. Rather, the notes were created for and used by corporations and banks for payments within the business and banking worlds.
Fascinating as they are today, more astounding is the value when adjusted for inflation. Based on that, $100,000 in 1918 would be almost three million dollars today. When issued in 1934, it would be worth $2.2 million.
Most of the 42,000 $100,000 bills were destroyed by the government. A few exist and are on display in museums. Naturally, they are under substantial security, but that’s for naught. Because they were made for private exchange and not general circulation, it’s illegal to own or spend one. All are the property of the US Treasury, so they are worthless in private hands. Even if one were to be stolen, the thief could do nothing with it. Where would he take it…Walgreens?
Incidentally, in typical government fashion, $100,000 bills were “gold certificates” redeemable in physical gold. But wait! A year earlier, in 1933, the US left the “gold standard” making it illegal for most Americans to own any gold coins or bullion. Yet again, another thing hasn’t changed – governmental inconsistency. Evidently the word of the government isn’t always as good as gold.
For more collecting advice, visit www.PRexford.com