Monthly Archives: July 2015

The Evolution of Money in the USA, From Feathers to Credit Cards


HISTORY OF MONEY OVER MANY LIFETIMEShouse of usa banknotes image

In the back closet of a large room that houses the entirety of the Smithsonian National Numismatic Collection, sits the taxidermic specimen of a Quetzal bird—curators call him Fred.

The metallic green and blue feathers shimmer in the light and it’s clear why this bird was so treasured— he is a tropical beauty. Found in the rain forests of Central America, the endangered bird held much significance for Mayan civilization. It was illegal to kill the bird, but its feathers were once used as currency, usually to purchase gold.

Today, though its feathers are no longer used for purchases, the bird remains highly revered in Central American culture, and Guatemalan money is actually called a quetzal. This taxidermic specimen is one of more than 1.6 million objects in the National Numismatic Collection, the largest in North America and one of the largest in the world.

After the establishment of the Smithsonian Institution, the numismatic collection slowly began expanding in the late 1800s. However, the most important event came in 1923 when then-Secretary of Treasury, Andrew Mellon, ordered the transfer of 18,324 coins from the U.S. Mint collection in Philadelphia to Washington, D.C. for safekeeping and as part of a way to build the national collection.

As Jeff Garrett, author of the Encyclopedia of United States Gold Coins, writes in his brief history of the National Numismatic Collection, “ One letter I have seen in the Smithsonian collection from this period states: ‘the transfer of this collection to Washington will mean the shifting of the numismatic center of gravity, so to speak, in the United States from Philadelphia to Washington.’ This was no understatement!”

To display the richness of the collection, the National Museum of American History recently opened the exhibition “The Value of Money.” Located in the newly renovated first floor Innovation Wing, the gallery beckons visitors to pass through a polished steel vault door into a softly-lit room to view more than 400 artifacts from the collection, from shells, feathers and credit cards to the highly valued 1933 Double Eagle $20 dollar coin and an extremely rare $100,000 bill. Much more than a display of old coins, the exhibition showcases the creative intricacy and design of historic legal tender and details its backstories and allure.

“Our exhibit represents the opportunity to show the diversity and strengths of this collection and to excite people to think about history, culture and innovation through numismatic objects,” says curator Ellen Feingold.  “We embrace the theme of innovation, but we also really embrace the value of monetary objects for learning about history.”

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1…Stones From the Island of Yap

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Need cold, hard cash? Well, that’s what you’ll literally find on Yap— the island of stone money. The circular disks carved from limestone known as Rai, were brought over from Palau, part of the Federated States of Micronesia. Though the stones range in size, the larger ones can weigh thousands of pounds and were used for big transactions such as funeral payments, dowries or land purchases. Although the island now uses U.S. currency, Rai stones are still occasionally exchanged. (Pictured: Rai stone ring from the Island of Yap, 20th century)hunded dollar notes line

2…California Clams

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Still have those shells you collected at the beach? Back in the day, they could have been shelled out for your next purchase. Shells were one of the most widely used objects for transactions on almost every continent. In America, they were used as late as 1933, in the city of Pismo Beach, California, during the Great Depression, when there was a currency shortage and shells served as ready currency. The clamshells were inscribed with the same information you’d find on a note, complete with “In God We Trust.” (Pictured: 1 Dollar Clam Shell, United States, 1933)

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3…The First U.S. Cent

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Coins didn’t always say “In God We Trust.” In 1787, Congress authorized the first U.S. cent, known as the Fugio cent, made of copper. It featured an image of a sundial, and underneath, stated “Mind Your Business.” These were the wise words of Benjamin Franklin, who is credited with designing the coin. (Pictured: Fugio 1787 copper cent)

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4…Shilling From the Colonies

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Rebelling against the crown, American colonists in the Massachusetts Colony started creating their own coins in 1652 during the interregnum—an 11-year period when there was no ruler in England. King Charles I had been beheaded in 1649 and the throne was not recovered until 1660. Creating coins had been an offense against the crown so clever colonists smartly crafted coins even after the throne was restore simply post dating them to 1652 long after the year had passed.  (Pictured: Shilling coin, Massachusetts Colony, 1667-74)

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5…Money Does Grow on Trees

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Although paper money had been around for decades in other countries, the United States had the first economy based on paper. The earliest note was issued by the Massachusetts colony in 1690. The colonists would have preferred coin, but the British limited how much coinage could come to the U.S. (Pictured: 20 shilling note, Colonial America, 1690-91)

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6…Blood Money

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Colonial money stated, “To Counterfeit is Death” and they weren’t joking. Counterfeiting was a crime punishable by execution. During the Revolutionary War, British loyalist counterfeiters David Farnsworth and John Blair were caught with $10,000 in counterfeit and hanged. Today, punishment includes up to 15 years in prison and/or a fine. (Pictured: 9 pence note, Colonial America, 1777)

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7…The Secret Service

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Today the Secret Service guards and protects presidents and their families, but the agency was originally created to suppress counterfeit money. During the Civil War, a reported one third of the currency in circulation was counterfeit. In 1865, the Secret Service was created to track down those villainous fabricators, closing more than 200 counterfeiting plants in its first year.

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8…$100,000 Bill

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The $100,000 bill, a 1934 Gold Certificate, is the largest denomination ever printed by the U.S. Bureau of Engraving and Printing. However, the bill was never circulated and was reserved only for use by the Federal Reserve for large transactions. A total of 42,000 certificates were produced and later discontinued in 1935. All but a dozen or so were destroyed. It is illegal to possess the bill, which is why you’ve probably never seen one. (Pictured: 100,000 dollar gold certificate, United States, 1934)

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9…The 1933 Double Eagle

The 1933 Double Eagle usa gold coin image

Worth millions, the 1933 Double Eagle gold coins continue to captivate people. After Franklin D. Roosevelt decided to abandon the gold standard in 1933 and all gold coins were ordered exchanged for paper currency. All but two of the Augustus Saint-Gaudens designed Double Eagle $20 coins (which came to the Smithsonian as “coins of record”) were destroyed. However, a handful of coins disappeared from the Philadelphia Mint just as the last were sent to be melted down. No one really knows how many survived. In 2005, ten suddenly showed up, evidently having escaped the melting chambers. The government confiscated them. But in April 2015, a federal court ruled that the rare $20 gold Double Eagle coins returned to a Pennsylvania family. (Pictured: 20 “Double Eagle” dollar coin, United States, 1933)

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10…Day Late and A Dollar Short

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Notice the lack of women on U.S. currency? Martha Washington has been the only historic woman with her portrait on U.S. paper currency on the face of the $1 Silver Certificate of 1886 and 1891 and the back of the $1 Silver Certificate of 1896. Although the “Women on 20s” campaign pushed to replace Andrew Jackson on the $20 with a significant American woman, U.S. Treasury Secretary Jack Lew recently announced that a woman would instead be featured on the $10, in 2020. The question remains, who? (Pictured: 1 dollar silver certificate, United States, 1896)

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Henry Sapiecha

Australians are getting poorer, comparatively speaking…

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The global purchasing power of Australians is diminishing Photo: Jessica Hromas

Australia is sliding down the ranks of purchasing power and in US dollar terms we can’t nearly buy as much as we could at the peak of the commodities boom.

As recently as last year, gross domestic product per person in Australia (in USD terms) was the fifth highest in the world. Only Luxembourg, Norway, Qatar and Switzerland outranked Australia in 2014, Deutsche Bank points out.

For 2015, however, the International Monetary Fund estimates Australia’s ranking will drop from fifth, to ninth.


Deutsche chief economist Adam Boyton expects the country to fall further down the rankings due to a continuing plunge in the dollar and lower nominal GDP growth over the next years.

“If we apply our 2015 and 2016 forecasts for nominal GDP growth in Australia (and assume 5 per cent nominal growth in 2017) as well as our forex forecasts – a decline in the AUD to 65 US cents by end-2016 and 60 US cents by the end of 2017 – then Australia’s ‘ranking’ falls from ninth in 2015, to 11th in 2016 and then 17th in 2017, Mr Boyton wrote in a note to clients.

A further decline in the dollar was a necessary element of the economy’s transition to non-mining led growth.

Mr Boyton said that the strong Australian dollar during the boom years had also led to a surge in online shopping from offshore retailers and overseas tourism, which allowed a large number of Australians to benefit from the mining boom.

“As the Australian economy and the Australian dollar adjust to the end of that boom, one of the unfortunate ‘side-effects’ will be a decline in the global purchasing power of Australians,” Mr Boyton added.


Henry Sapiecha

3 personality traits of famous billionaires

After analysing more than 900 self-made billionaires, the majority of which have made their fortunes during the past 20 years, UBS and PwC have revealed the top three personality traits.

Making money come to you.

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1. An appetite for smart risk-taking

The first trait that is essential for entrepreneurial success is an appetite for smart risk-taking, according to the recent Billionaire Report.

“Self-made billionaires tend to have a very optimistic attitude towards risk, focus on risks they understand and find smart ways to reduce them,” said the report.

“What’s more, their keen instinct for risk and opportunity often allows them to exit at the peak, transferring risk to others.”

The report identified three elements of smart risk-taking among billionaires, starting with a risk profile that is “skewed towards focusing on the upside and being realistic on the downside”.

“They’re afraid to lose by not capturing an opportunity, tending not to worry about the downside of a new venture failing but instead being concerned about missing out on the upside,” the authors said.

The second part of being a smart risk-taker is looking for opportunities where there is already an advantage. “In these situations the risks for anybody without these advantages will appear high and they are likely to walk away,” the report found.

And the third element is the ability of self-made billionaires to recover from failure, often by keeping enough resources to enable that recovery and being ready to “pivot” or adjust an idea until they succeed.

2. Obsessive business focus

The second key personality trait of self-made billionaires identified in the report is obsessive business focus. “Self-made billionaires are constantly scanning the world for untapped opportunity,” the report said.

“Curiosity is a core skill of most self-made billionaires we met. This curiosity is constantly driving them to look for unmet customer needs that create a significant business opportunity.”

After the opportunity is identified, these billionaires “switch to an extremely focused modus operandi in execution that some observers could call ‘tunnel vision’,” the report found.

“One interviewee compared this to a fighter pilot who focuses on the horizon and totally ignores things at the edge of his sight.”

3. Dogged determination

And the third trait that is found among the world’s billionaires is, unsurprisingly, “dogged determination”. “Billionaires are highly resilient,” the report said.

“Undeterred by failures and roadblocks, they have a tremendous work ethic. They confront and overcome obstacles, persevering in the face of adversity.”

“Our interviews showed that self-made billionaires often tend to be serial entrepreneurs who learn from their mistakes and doggedly work towards great wealth creation.”

But while there may be a clear link between these three personality traits and high levels of wealth creation, Eve Ash, psychologist and chief executive of Seven Dimensions, told SmartCompany the same traits are often present among all business owners and entrepreneurs.

“Certainly the optimism factor, which is coupled with clever risk-taking,” Ash says. “It’s the feeling of not having the fear or being able to manage what some other people might find paralysing.”

Ash says often a positive experience that came about by an individual taking a risk can contribute to this trait, as can an upbringing in a family that encouraged entrepreneurship. Although Ash says sometimes this can work in reverse, with the children of a family where the parents worked in long-term jobs for other people instead choosing to “break away” and start their own company.

The billionaires analysed in the report have generated combined wealth of $US3.6 trillion, with US-based entrepreneurs having created the most wealth, especially in the technology and finance sectors.

However, the report found “Asia’s new industrialists, consumer product tycoons and real estate investors” are also in the mix, with rising real estate and capital markets playing a strong role in the creation of new billionaires.

Self-made billionaires usually start young but most do not hit the billion-dollar mark until well after they turn 40. Close to a quarter of billionaires looked at in the research (23%) launched their first business venture before the age of 30, while over two thirds (68%) got their first venture off the ground before turning 40.

Having some corporate experience appears to pay off, with almost half of the billionaires having worked in a large organisation before going solo. A large majority (82%) had completed tertiary studies.


Henry Sapiecha