America’s ‘New Metallic Currency’ - how 'encased stamps' became currency during the US Civil War

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06 January 2019
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The US Civil War created numerous artefacts and ephemera that is today eagerly collected by enthusiasts including the intriguing items which combine postage stamps and coins

It goes without saying that the US Civil War had a huge and lasting impact on the country, but the ripples of the four-year conflict stretched right around the world. 

In Britain the war of 1861 to 1865 led directly to the ‘Lancashire Cotton Famine’, as it came to be known, as the slave-owning Southern States imposed a cotton boycott in the hope that they could garner British support for their cause. A blockade by the Union followed and the supply of cotton to these shores dwindled; the boom of the industrial revolution was replaced by unemployment and poverty.

Those who worked in the cotton mills in hubs such as Blackburn were suddenly faced with queuing for soup, exchaning paper tokens for food, bedding and clothing. Many were employed to mend roads, build pathways and sewerage systems. 

On the other side of the Atlantic, closer to the fighting, the USA was facing its own economic fall-out, with the production of copper-nickel cents only temporarily halting a shortage in currency. Traders soon turned to postage stamps as a means to buy and sell, and soon the payment became official, with the government printing stamp impressions on banknote paper.

It wasn’t long before entrepreneurs began to capitalise on the ad-hoc currency. Printers sold special envelopes, decorated with advertising, for the public to store their stamps, but it was businessman John Gault who neatly created a more durable and familiar storage solution.

Gault’s encased postage stamps, promoted proudly in local newspapers as the ‘New Metallic Currency’, consisted of two covers made out of silver, into which a postage stamp could be placed and displayed. The cases closely resembled coins and were widely used, so much so that the silver soon wore away, and production continued using cheaper brass.

Gault’s ingenius but simple invention only lasted a few months, as the government increased production of brass and copper-nickel coinage in 1863. But by then he’d made thousands, earning 20% of the face value of the stamps and later allowing advertisers to promote their gooods and services on the back of the cases. At least thirty companies are known to have used the unique format to promote themselves, and the National Smithsonian Postal Museum suggest around 750,000 pieces were sold.

Today it’s no surprise that the encased stamps are popular with collectors, whether they specialise in coins or stamps. Of the thousands that were exchanged during those hard times, up to 7,000 examples are thought to have survived. Naturally, different varities demand different prices.

In 2014 US philatelic auctioneers Robert A Siegel sold a range of encased stamps.

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Highlights included:

  • An encased ‘10c Green’ featuring an advertisement for Ayer’s Sarsaparilla, which sold for $900 (approximately £670)
  • A 3c Rose features an advert for Dougan, Hatter, New York, and sold for $2,300 (£1,700).

Both examples are illustrated here and speak for themselves; simple but satisfyingly additions to any collection.

Images:

‘Ayer’s Sarsaparilla’ advertised on the reverse of a 10c Green encased postage stamp

A 3c Rose featuring an advert for Dougan, Hatter, New York. The auction description reads: ‘The advertising legend on Dougan’s encasements depicts a men’s top hat, making them among the most distinctive and desirable of encased postage stamps. Dougan’s store and $5,000 worth of goods were destroyed in a fire on December 12, 1878 (New York Times archive)’.

Images courtesy of Robert A Siegel Auction Galleries, www.siegelauctions.com

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