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Early small $20s challenge to find

Everyone wants a good value in their notes and with additional numbers of collectors finding those good values is getting tougher and tougher. The early small-size $20 of the 1928 and 1934 series might be one exception.
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Everyone wants a good value in their notes and with additional numbers of collectors finding those good values is getting tougher and tougher. The early small-size $20 of the 1928 and 1934 series might be one exception as while prices have certainly increased in recent years the small-size $20 in most cases still is a good value today and comprises a fascinating and diverse collection as well.


Historically lower denominations have naturally been more heavily collected and saved. It is natural as people tend to start collections with the lowest denominations. In fact, in the case of notes, many collectors were oftentimes limited to lower denominations altogether as they simply did not have a budget to start a $10 or $20 collection.

Even today, the $20 face value will stop many people. Time and greater incomes have begun to change that and with those changes has come greater interest in higher denominations. That said, the $20 is still a denomination that tends to fall between the cracks in collector interest as it is neither a low nor a high denomination. A well-heeled collector might opt for $100 notes while someone on a lower budget might attempt a collection of $2 notes, but very few start or even graduate up to the $20 until they are a very advanced collector.

All of those factors have a serious impact on the $20 today. While prices might seem reasonable especially in circulated grades, the fact is that in many cases the supply for today and tomorrow’s collectors is not as strong as the prices might suggest. Supply is often much lower than we might expect as a small-size $20 was a very expensive note to be saving back during the Great Depression, which began shortly after the United States adopted the smaller size note in 1929.

There is ample proof of the fact as even in the 1950s and early 1960s when many were actively saving Silver Certificates, the denomination usually saved was the $1 and not the $5 or $10. It was not a case where there were no others it was rather a case where relatively few wanted or could afford to save a higher denomination and if they were not going to save a $5 they were certainly not likely to be saving larger denominations.

Under these circumstances the small-size $20 represents a fascinating opportunity and a challenge. Because of cost and availability it is really a case where the only $20 notes they can obtain are small-size. In the case of large-size notes a collection of $20 types very quickly becomes extremely costly. You might be able to obtain a blue seal large-size Federal Reserve Note or a nice National Bank Note although not an earlier one. Then you could attempt to add a $20 Gold Certificate, but in Choice Crisp Uncirculated 63 that price is likely to be $1,400 or more and these are still the more available large-size notes. If you wanted to extend your collection to include Silver Certificates or Demand Notes or things like National Gold Bank Notes you are facing a serious challenge both to your budget and your patience even when it comes to finding a lower grade example and something like a Choice CU 63 in many cases is basically unknown or at least unavailable at prices many can afford.

Standard Guide to Small-Size U.S. Paper Money

The Standard Guide to Small-Size Paper Money, 10th Edition is the ultimate price guide for today's collector.

With the cost factor in mind, a small-size $20 collection becomes the logical and in many minds only alternative. In a small-size collection instead of spending tens of thousands of dollars for most Choice CU 63 or higher notes it is possible to acquire many extremely nice and sometimes scarce notes for prices sometimes under $100 with only a few even topping the $1,000 mark.

Moreover, at least for now most of the notes can be found on a regular basis either from major dealers or at large shows and auctions.

If anything, the low prices can be deceptive. The small-size $20 as well as all small-size denominations began to appear in early 1929. The idea of reducing the size of notes stretched all the way back to 1913 but for one reason or another the change was delayed. With an introduction in 1929, the new small-size notes had barely reached circulation when the stock market crashed and the country began an economic nosedive into the worst financial crisis it has known in modern times.

Even if someone had saved a new small-size $20 when they first appeared, the chances are good that during the crisis of the Great Depression they would have been hard-pressed to save their notes as with greater than 25 percent unemployments and one-half of the nation’s home owners behind in their mortgage payments the idea of saving $20 notes is one most cannot consider. Had the crisis been just a few months long more higher denominations might have been saved but as the months dragged on and fear became widespread with “bank holidays” and other problems the nice $20 which might have been saved very easily could have become an emergency source of funds to buy items that were needed by families to survive.

An impact of the Great Depression that is rarely discussed is that it ended up increasing the number of $20 notes in a collection. At the time, small-size $20 notes were introduced they started with Federal Reserve Notes with green seals, which were followed by Gold Certificates with yellow seals and National Bank Notes with brown seals. The Gold Certificates were recalled but the changes in gold policy saw a number of series of Federal Reserve Notes produced from the 12 districts along with star replacement notes. Just the Federal Reserve Notes over a short period of time not even spanning the entire Great Depression saw the Series 1928 followed by the Series 1928A, the Series 1928B and Series 1928C and the face value of all of these issues for all the districts involved with both regular and star replacement notes would have been a small fortune at the time. In addition there was the addition of Federal Reserve Bank Notes in 1933 further adding to the number of $20 notes issued during a short period of time.

To start a small-size note collection the best place to begin would be the Series 1928 Federal Reserve Note which first appeared with a Tate-Mellon signature combination. When first released, times might have been good and with the novelty of the new small-size note it was probably saved in small numbers. The prices today reflect that fact as a Gem CU 65 would command perhaps $250 but an XF example might barely reach $30. In the case of a Series 1928 star replacement note a current Choice CU 63 listing from the cheapest of the 12 Federal Reserve districts is $1,500.

The sheer number of notes in a small-size $20 Federal Reserve Note collection is really the major hurdle. With 12 districts and 12 star replacement notes in the Series 1928 alone, that is $480 face value. If you could find them, circulated examples from each district can probably be acquired for not much more than twice face value on average, which really is low for something more than 80 years old.

On the other hand, as with coins, if you buy the lower grades, you tend to eliminate the potential for future price appreciation. Paper money collectors focus on quality just as much as coin collectors do.

The key is the Series 1928C, which was issued only for the Chicago and San Francisco districts with a total printing of less than 5 million notes for the two districts combined. The Series 1928C was also quickly retired as it was the final series of $20 Federal Reserve Note that carried the so-called “gold clause,” which provided for payment in gold.

With the gold recall of 1933, that gold clause had to be eliminated and that saw notes from the Series 1928C and earlier retired as quickly as possible. The earlier series had time in circulation but the Series 1928C was barely getting into circulation when it was already being retired. That makes it a tougher note than even its low printing suggests with a VF at $500 and $700, respectively, for the Chicago and San Francisco notes and $2,000 and $5,000 for them in Choice CU 63.

The Series 1928C, however, is the exception among the regular Federal Reserve $20 issues which are normally available for price on either side of $100 in Choice CU 63. For notes dated 1934 and later, the prices generally get much cheaper.

There can be tougher notes if you attempt to obtain an example from every district as printings were not the same and in some cases they are very different. A Series 1928A, for example had a printing of over 1.7 million notes for Philadelphia and only 113,900 for Kansas City and clearly the two districts are unlikely to be at the same price level.

In the case of star replacement $20 Federal Reserve Notes the Series 1928A is a significant problem with an VF star from the most available district currently at $2,000.

Star replacement notes also get cheaper as the dates become more recent, but it must be remembered that stars have become quite popular is recent years with small-size note collectors.

While not as cheap as they used to be, small-size the $20 Federal Reserve Note has to be considered a good value with a number of potential sleeper as they have not been heavily collected by district. That makes some regular notes as well as a number of stars very possibly much tougher notes than their prices suggest today, but the situation is not likely to last indefinitely as eventually with additional demand tougher districts will be discovered and many very tough stars will begin to command the premium prices they deserve.

The Standard Guide to Small-Size Paper Money by John Schwartz and Scott Lindquist can help you navigate through the ins and outs of districts with high printings and with low printings.

The other early small-size $20 was the $20 Gold Certificate from the Series 1928. The $20 Gold Certificate is more available than might be expected at prices that range from $125 in VG to $2,250 in Gem CU 65. Even at these levels you have to feel the $20 Gold Certificate is inexpensive as they were, after all, called in in 1933 and destroyed unlike the Federal Reserve Note.
Few in 1933 were willing to risk losing $20 by having an illegal piece of paper money. It was a risk most could not have afforded.

Fortunately there are some small-size $20 Gold Certificates for collectors today, but few would doubt that if there was a significant increase in demand the supply especially in upper grades would potentially be exhausted very quickly and a star replacement note could already be called difficult as is seen in prices of $300 in VG to $15,000 in Gem CU 65 and the current interest in all star replacement notes seems likely to push those prices even higher.

By the time the small-size era began, the National Bank Note was a Civil War relic on its way out. National Banks could issue notes with their names on the face. But such an individual character flew in the face of a general effort to make American paper money more uniform.

National Bank Note production continued until 1935. There would be two types of $20 National Bank Notes issued between 1929 and 1935 with both bearing the same 1929 date and federal signatures of E.E. Jones, Register of the Treasury and W.O. Woods the Treasurer. With some 6,000 banks in 48 states and the territories of Alaska and Hawaii issuing notes during the period, there is an almost endless number of varieties of small-size $20 National Bank Notes.

In the case of Type I National Bank Notes, there are both prefix and suffix letters around the serial number while the charter number appears vertically at both ends of the note. In the case of Type II notes there is only a prefix letter at the serial number and the charter numbers appear at both ends as was the case with Type I but also succeeding or preceding the serial number making a total of four appearances as opposed to just two.

For a type note there is really very little difference with a Choice CU example of either type. It should be noted, however, that the lowest price is for an available note from an available state. There are tough banks and very tough states as is always the case with National Bank Notes and that means that if you want a specific bank or state you may be faced with a much higher price and a more difficult search finding the note you desire as a note from the territory of Alaska for example is not easily located and will be many times higher than the available state price.

The real emergency issues of the Great Depression were Federal Reserve Bank Notes. These were a hybrid sort of note. They were the National Bank Note template converted for use by the individual Federal Reserve Banks. What made them unique is they were the obligation of the issuing bank and not the whole Federal Reserve System. Each note carried the name of the issuing Federal Reserve Bank on the face.

Federal Reserve Bank Notes have been receiving a good deal of attention recently as many collectors have now discovered just how tough they can be especially the star replacement notes. To appreciate the emergency that caused them to be issued in 1933, we have to remember at the time there had been bank failures and many other major problems. The goal was to get more money into circulation but at the same time there had been a severe drain on the Treasury gold reserves.

It was a very difficult situation and officials were searching for a way to add to the money supply to be delivered to banks that would reopen after the national bank holiday.

These notes had limited backing, which is what enabled them to be issued in large quantities quickly. The existing small-size notes would not work and an initial thought of using United States Note ran into the legal limitations as to the amount of United States Notes that could be outstanding and any given time. An emergency measure was passed to authorize Federal Reserve Bank Notes with very relaxed collateral requirements and the notes were rushed into production with the first shipments actually being on their way in a matter of days.

These notes had brown seals like National Bank Notes and are dated 1929. As it worked out, the rush to produce large numbers of Federal Reserve Bank Notes was not required. President Roosevelt was able to at least restore some confidence and while the Federal Reserve Bank Note was issued, a significant percentage of the printing especially in the case of upper denominations, was not released initially but was later released during the first couple years of World War II. In both instances the Federal Reserve Bank Note did not circulate for a long time and in both cases as well times were not good for many to be saving large numbers of the new notes. As a result, all Federal Reserve Bank Notes are more difficult than many would suspect and star replacement notes are increasingly getting a good deal of attention as especially difficult small-size notes.

In the case of regular $20 Federal Reserve Bank Notes, a type example can be found for $175 in Choice CU 63. In the case of star replacement notes the Federal Reserve Bank Notes have a well-deserved reputation for being scarce. The most likely districts to be found in the case of a $20 star are Philadelphia, New York, St. Louis and Richmond while Boston, Cleveland and Atlanta only have small numbers of known examples. In the case of Dallas or San Francisco the number of known examples is less than 5 and neither can be expected to be seen in the market with any regularity.

There was one other type of small-size $20 which reflected an emergency and that was the $20 Hawaii emergency note. The Hawaii emergency note was issued at a time when there was reason to fear that Hawaii would be invaded and possibly captured by the Japanese. If the islands were captured there would potentially be large sums of money that could then be used to purchase war supplies to be used against the United States.

Making potentially captured notes easy to recognize was a high priority and in the case of the $20 that meant using $20 Federal Reserve Note from the Series 1934 or 1934A with large black “HAWAII” overprints and brown seal. The notes were from the San Francisco district and were the highest denomination of Hawaii overprints. As the highest denomination they were least likely to be saved and that means prices today of $50 to $100 in VG/F for 1934 and 1934A notes.

In acquiring a Hawaii emergency note you are really getting not only a tough note but also a true souvenir of World War II as they were used on Hawaii as the only legal notes for much of the war and later were in some cases used on other Pacific islands after they had been reclaimed from the Japanese.

The wide range of small-size $20 notes makes for a fascinating number of collecting possibilities today whether you want simply type notes or a more involved collection such as the Federal Reserve Notes and stars by districts.

What must be remembered, however, is that few collectors at the time could have saved a single nice $20 note much less all the different types issued especially during the Great Depression. That makes supplies at best suspect and if new generations of collectors discover the small-size possibilities the prices of today may look awfully good in the future.

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