SCRIPOPHILY

absurdum ad reductum

Shares of the Hanover Mining and Milling Company are selling for 3$ a share. This company has been bankrupt for decades!  How many gold mining companies listed every day on the chat boards are selling for pennies!  There must only be, what, 30-40 or so mining companies today selling for 3$ a share.  As recently as 2000 there were only a handful!

This BANKRUPT company WHICH HAS NOT TRADED FOR DECADES and has NO EQUIPMENT, NO RESERVES, NO INFRASTRUCTURE, is trading higher than BGO and WHT...

Let’s then examine what these 25 shares of Hanover Mining represent:

Real Property: Maybe they had, for instance, a jaw-crusher. Perhaps they depreciated it over a 27.5 year life.  Enough years have passed such that this crusher could have been depreciated four cycles (well, not legally).  The crusher, should it have been put to any worthwhile use whatsoever, was scrapped and turned into another implement.  More likely, the crusher has rusted and rotted in the surrounding sand.

Intellectual Interest: from a turn-of-the century miner?

Possessory Interest: HaH! Successor companies have been absolutely destroyed by possessory succession of previous mining interests.  Mainly, the successor company has absorbed joint and several liability for a contaminated site that may cost thousands to clean up.

(Nobody ever talks about TechCominco problems with the federales re: metal pollution in lower watershed. A major story, all but silent.)

What about the gold?: How many companies that issued stock in 1902 actually became producers? The example of a jaw crusher is likely a hopeless dream in this case. More likely is Hanover went belly-up by the time the post office was constructed.

The economy of the next hundred years will be powered by plant oils (bio-diesel). The economy of the next hundred years will again be denominated in metals.  (After this brief period of aberration).

yes, paper is more valuable than gold

a complete mind feck!

The counter thought is: well, some single pieces of silver or gold (as coins) sell for hundreds or thousands (even millions) of dollars. Yes, this is true. But, the vast majority of them (by number) can be had for 50 cents or less.

So, these coins are only valuable because they are rare, right? And lack of supply causes demand and value.  After all, WHT has millions of shares outstanding. The Hanover Mining Company may only have several thousand.

But if the paper was valuable only because it was rare, then any pretty drawing I make on an 8x11 sheet should be worth big bux, after all, it is unique-one-of-a-kind.  Factually, it is worthless; becoming only valuable if I personally become either famous or infamous (and that is a longshot).

If the paper was valuable only because it was old, then every handwritten letter which is 100 years old would sell for 5$ a page. Heck, both unique AND old. But no, unless of some historical importance, or of the hand of a known name, they too are practically worthless.

And so, the great irony of the bankrupt mining company scrip. Only valuable b.c. it speaks to the former gold mining glories of days gone bye.  Value by proxy; sprinkled with stardust long worn off. The paper shell is a newly prized commodity. Meanwhile, the ores are played, the minerals are gone, and the former mine and mill, nay – the whole town and every one who lived and toiled therein – lays as dust.

Eagle Silver Mining Company

 I've an opine on Eagle Silver Mining Company

Chart don’t look so hot, but at $2.80 a share doing better than quite a number of other wanna be goldies out there…

Stock looks nice: “The stock has a wonderful vignette of an eagle with smaller vignettes and steamships and railroads. The stock is in crisp excellent condition with only faint folds and a few cancellation holes.”

http://cgi.ebay.com/ws/eBayISAPI.dll?ViewItem&category=3449&item=3954052506&rd=1

They charge extra for vignettes I guess...

Why invest now, only to watch ‘em go bankrupt later.

Mercury sayeth: "Buyeth the pretty little paper of the three-score-year-gone bankrupt memory of a company now while the share price is appreciating."

How to Value Scripophily: Things to look for on an old stock certificate:

1. Are the shares uncancelled? If so, the certificate could still have monetary value - though unlikely.  The trick here is to follow the possessory interest and/or liability of the company all the way through a current parent corporation.  You can pay to have this service performed.  Here is just one firm that provides this service (haven't tried them so can't vouch one way or another):

http://www.paperchaseintl.com/

Another trick involves tracking dates of incorporation and all further buyouts, insolvencies, mergers etc.  Searches of state government databases on business incorporation and taxes can yield valuable information.

http://www.library.unr.edu/specoll/mining.html

Furthermore, private historical documentation sites yield incredible groves of information, often concentrated on a particular subject.  Here is one example of financial archaeology done right (very impressive!):

http://www.frankkryder.com/california.htm

Bottom line: If the certificate is cancelled, the financial value is also cancelled and you now are looking at artistic, collectible, and historic value.

2.  Are the names legible?  If so, research who they were. Some famous people have signed stock certificates at the beginning or end of another career as either a president or treasurer of a company.  Singed stock certificates with famous signatures, like autographs, carry a premium.  Now you have two markets to advertise your certificate for sale - the Scripophily market and the niche for that particular famous person.  Likewise, look for the signature of the owner on the back (endorsed line) of the stock. The odds of the lowly stock owner being famous are pretty slim, but you never know. 

3.  What condition is the certificate in?

4.  Is the artwork, vignettes, engraving particularly attractive?

5.  Like many collectibles, older is worth more than newer.

6.  Is the company very rare or very famous? 

7.  Is the number of the certificate very low, or the number of shares issued very high?

8. Does the company have historical value?  The first miner on the Cripple Creek Mining District is sought more often than just another bankrupt sewing machine manufacturer.  Mining, Oil and Railroads have devoted followings. Technology too, to a lesser degree.  

9.  Does the certificate come with tax-paid stamps on the sheet?  Are there dividend coupons attached?

10. Unissued certificates, unless a rare pattern or unique specimen, trade at a larger discount.

Scripophily Sites

http://www.antiquarypartnership.com/

http://www.denverstockexchange.com/

http://www.goldsheetlinks.com/obsolete.htm

http://www.geocities.com/jdphoto33/

http://www.historicpapersfriehs.at/

http://www.holabird.org/

http://pentenrieder.com/

http://www.peterwebb.co.uk/scripophily.htm

http://www.scripophily.net/mining-stocks.html

http://www.scripophily.nl/

http://www.stocksearchintl.com/mining.html

http://www.stocksearchintl.com/faqs.html

Scripophily Grades

The following guidelines generally apply to all ephemera (collectible paper):

Unc  -  Uncirculated

EF  -  Extremely Fine - minor folds, clean, issued but not handled much.

The following guidelines generally apply specifically to scripophily as determined by the International Bond and Share Society:

UNC

Uncirculated.  Appears straight from the printers without the slightest flaw.

EF  -  Extremely Fine.  Appears in almost perfect condition; the signs handling are just visible.

STAMPS AND CANCELS

For further reference:

Cancellations and Killers of the Banknote Era 1870-1894, by James M. Cole

The Foreign Mail Cancellations of New York City 1870-1878, by William R. Weiss, Jr.

United States Cancellations 1845-1869, by Hubert C. Skinner and Amos Eno.

PAPER CURRENCY

Currency

Suggestion to the denizens of NOLA:

Bring back the AFRO:

Afro-American Face Reserve Organization.  These AFRO dollars were used as trade scrip in the 1970's.

The fed has shown their interest in you. Perhaps it is now time to return the favor and regain control over your community.

Colonial Splits

During the early Colonial and continental period of the fledgling US change was very scarce.  Currency of the time issued by the colonies traded and were occasionally folded and split into quarters for change.

Republic of Texas Notes. Issued by the Texas Militia in 1995. Harkened back to the original Texas Republic days.

Private Currency

Private currency has always been a supplement to the state scrip.  By the time the civil war was over, the US Treasury was so depleted that it embarked on a campaign to tax everybody and everything possible, including the freely traded private currencies of the day.  The state of Louisiana brilliantly upended this tax by instead circulating bonds as currency. Since bonds are not federally taxable, either now nor then the US collected no revenue on the 'Louisianan Baby Bonds'.  The bonds traded as currency by face value. Eventually the Congress found out and made the practice illegal.

The Afro American Face Reserve Organization informed a community trade currency called the AFRO.  Similar to other types of community currency, the AFRO was designed to circulate throughout the black community and generate both status and awareness of the purchasing power that the community yielded. The twenty dollar notes circulated for just a short time.

http://www.pomexport.com/N-USA_Afro20D/info.html

Prison Camp Scrip

http://www.wintersonnenwende.com/scriptorium/english/archives/articles/ccmoney.html

Reference Works

Mineral Resources West of the Rocky Mountains (J. Ross Browne, 1868)

Manuals of Valuable and Worthless Securities (Fisher)

Manual of Extinct or Obsolete Companies (Scudder)

Why worry about paper, anyway?

Real Photo Post Card (RPPC): A postcard format used roughly between 1900 - 1945. Individuals provided their personal photos to a developer who would then provide a standard postal backing.

200 Year 10-Year Treasury Note Chart

http://www.page88.co.za/cr/charts10yr.shtml

US 'dollar' chart:

http://quotes.ino.com/chart/?s=NYBOT_DX&v=dmax

How to determine price of goods today versus in times past:

http://minneapolisfed.org/research/data/us/calc/#calc

How to Convert the dollar into Standard Drawing Rights:

http://coinmill.com/convert/SDR_XAU.html?amount=1

http://fx.sauder.ubc.ca/cgi/fxplot?b=XDR&c=XAU&rd=91&fd=1&fm=1&fy=2005&ld=31&lm=12&ly=2006&y=daily&q=volume&f=png&a=lin&m=0&x=

http://home.columbus.rr.com/rossl/gold.htm

What the unit previously called the US Dollar, now the DX, is 'worth':

USDX = 50.14348112 × EURUSD^(-0.576) × USDJPY^(0.136) ×

GBPUSD^(-0.119) × USDCAD^(0.091) × USDSEK^(0.042) × USDCHF^(0.036)

Proper Paper Care 

Oils

Eucalyptus oil. Widely available in California and Australia; carried by some department and hardware stores.

Peanut butter to remove labels.

On nonporous surfaces (glossy paper, etc.) consider Neutrogena Sesame Body Oil.

Avon Skin So Soft is another product that removes certain gummy glues well.

Olive oil, especially for use on metal.

Solvents

WD40 removes labels off of metal well. As with all solvents, can leave a stain. 

Goof-Off works well on sticky paper backings. The same manufacturer also makes a product which removes labels from glass called Painters Pal. 

Citrus is an acidic solvent. Citrus based products such as  Goo Gone work well removing paper from wood.  This product is combustible.

Hairspray will remove many stickers.

Acetone has its applications, but it's such a highly flammable material that only specialists should use it. 

Tape

United Label [Unitedlabel.com] makes a product called "At-Tack" which feels like oil but won't leave residue.

Bestine can be found in art supply stores. Although both finicky and expensive, practice  will provide applications that prove very useful. product.  (Llabels off newspapers, etc.) Use cotton, such a Q-tip to apply.

Scotch tape: Put over the unwanted sticker, press firmly, remove quickly.

LAWFUL MONEY

Whereas,

Article 1, Section 10, of the Constitution for the United States of America states:  

“No State shall.. make any Thing but gold and silver Coin a Tender in payment of Debts.”

Further, United States Code, Title 12, Section 152, states:

“Lawful money shall be construed to mean gold or silver coin of the United States.”  

Bouvier’s Law Dictionary [1870, page 192] makes the definition even simpler: “Gold and silver coins.  The common medium of exchange in a civilized nation.”, and 

Black's Law Dictionary, Sixth Edition, page. 1005 states:

"Money:  In usual and ordinary acceptation it means coins and paper currency used as circulating medium of exchange, and does not embrace notes, bonds, evidences of debt, or other personal or real estate.  Lane v. Railey, 280 Ky. 319, 133 S.W.2d 74, 79, 81."  [Black's Law Dictionary, Sixth Edition, p. 1005].

AND

http://www.civil-liberties.com/pages/money.html

 AND

http://www4.law.cornell.edu/uscode/html/uscode12/usc_sec_12_00000411----000-.html

AND

http://www.the-privateer.com/paper.html

Then,

Federal Reserve Notes (FRN) are not "money" because the FRN is defined as redeemable for lawful money by United States Code and you cannot use a term to define a term; i.e. FRNs cannot be money if they are redeemable for money. 

Witness that the 1934 Federal Reserve Note contained the following statement:  “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.”  

Note, after 1933 the FRNs could not be redeemed in gold or other goods or "lawful money" by the Treasury. Yet, this section in the USC has not been repealed from the code by law!  FRNs "currency" in a legal sense in that they represent debt.

Knowledge: Rarer than gold. Wisdom: Lighter than air.

US PAPER CURRENCY: An aberration awaiting an acutely anticipated abortion.