Friday, May 24, 2024

History of the Panamanian Balboa: From Past to Present

Are you captivated by the allure of currency history and the stories embedded within each coin? Got a collection of coins from every nook and cranny of the globe? The official currency of Panama has a long and rich history spanning over five centuries, dating back to the time the first Spanish explorer, Vasco Núñez de Balboa, set foot on the isthmus of Panama. 

First things first – Why is Panama money called balboa? Well, the national currency of Panama, the Panamanian balboa, is named after Vasco Núñez de Balboa – the Spanish explorer who discovered the Pacific Ocean in 1513 after crossing the isthmus of Panama.

He was the first European to see the vast body of water that separates North and South America from Asia, claimed it for the Spanish crown, and established the first permanent European settlement in Panama, Santa María la Antigua del Darién. Balboa’s discovery opened the way for international trade and colonization in the region, and he became the governor of the province of Panama.

1904 – The Cornerstone

His legacy is honored by the Panamanian people, who adopted his name for their currency in 1904 when Panama gained its independence from Colombia. The balboa replaced the Colombian peso, which had been the official currency of Panama since 1821 when Panama joined the Gran Colombia, a federation of former Spanish colonies. The balboa was equivalent to the US dollar right from the start and backed by silver coins minted in Panama.

As liberty prevailed, the wave of change brought forth the debut of fresh silver coins in values of 2 1/2, five, 10, 25, and 50 céntimos. Subsequently, the currency expanded to encompass denominations of one-tenth, one-fourth, one-half, 1 1/4, and one céntimo. These Panamanian coins not only mirrored the size but also replicated the metallic composition akin to those found in the coinage issued by the United States, adding a fascinating layer to the evolving currency landscape.

The Dual Currency System

The Panamanian balboa is part of a unique currency arrangement that allows Panama to use both the Balboa and the US dollar. This system, known as the dual currency system, was established in 1904 when Panama signed a treaty with the United States and adopted the US dollar as its legal tender, granting the latter the right to build and operate the Panama Canal – a strategic waterway that connects the Atlantic and Pacific oceans.

In exchange, the US agreed to provide Panama with economic and military assistance and to guarantee its sovereignty and independence. The dual currency system has several advantages for Panama, such as:

  • It facilitates financial transactions and international trade with the US and other countries, as the US dollar is widely accepted and trusted around the world and considered a "safe-haven" currency.
  • It eliminates the risk of currency exchange rate fluctuations and currency devaluation, as the Balboa is pegged to the US dollar at a fixed rate of one-to-one (1:1), with the dollar being a reliable currency.

However, it also has some drawbacks, such as:

  • It limits the autonomy and flexibility of the Panamanian government to respond to economic shocks or crises, as it cannot use monetary policy tools such as interest rates or inflation targets to adjust the economy.
  • It exposes Panama to the economic conditions and policies of the US, as any changes in the US dollar’s value or demand can affect the Panamanian economy.
  • It creates a dependency on the US, as Panama has to rely on the US for its currency reserves and liquidity.

Despite these challenges, the dual currency system has proven to be successful and beneficial for Panama, as it has contributed to its economic development and annual growth.

The Rise and Fall of the Balboa Banknotes

The Balboa coins enjoyed a period of stability and popularity until the 1930s when the global economic crisis and the devaluation of the US dollar affected the exchange rate and the value of the Balboa. The Panamanian government, with President Dr. Arnulfo Arias, decided to introduce paper money, or banknotes, in 1941, which were also equivalent to the US dollar and issued by the Banco Central de Emisión de la República de Panamá.

The banknotes were printed in denominations of 1, 5, 10, 20, and 50 Balboas and featured the portraits of prominent Panamanian figures. However, the banknote issue was short-lived. A mere week later, a military coup ousted Arias from power, replacing him with Ricardo Adolfo de la Guardia Arango. The Banco Central de Emisión was dissolved in 1949, and all Balboa banknotes were withdrawn from circulation.

The remnants of these banknotes are now rare treasures, known colloquially as the "Seven Days’ Notes" or the "Arias issues," and hold significant value among collectors to this very day.

The Pulse of the Panamanian Economy

The Panamanian government faced several political and economic challenges in the following decades, such as corrupt governments, fraudulent elections, military coups, and US interventions. The Balboa coins remained in use, but they were overshadowed by the US dollar, which became the dominant currency for daily transactions and international transactions.

Throughout this period, Panama continued to use U.S. banknotes alongside the Balboa, emphasizing its strong economic ties with the U.S. Wondering what currency is mostly used in Panama? The Balboa coins are mostly used for small change and everyday transactions, while the US dollar is used for larger purchases and savings. Panama's economy relies predominantly on the services sector, constituting nearly 80% of its GDP.

What about the modern times? In the third quarter of 2023, Panama's economy showed significant growth, expanding by 9% compared to the previous year. Looking at the broader trend, the country's Gross Domestic Product (GDP) Annual Growth Rate has seen an average increase of 5.91% from 2010 to 2023.

Notably, the second quarter of 2021 witnessed a remarkable high with a growth rate of 43.90%, while the second quarter of 2020 experienced a record low with a decline of -36.20%. These figures reflect the dynamic nature of Panama's economic performance in recent years. 

The Features of the Panamanian Balboa

The Panamanian balboa currency code is PAB (numeric: 590) and is composed of coins in denominations of 1, 5, 10, 25, and 50 cents or 100 centésimos, and 1 and 2 Balboas. The coins are issued by the National Bank of Panama, one of the two public banks in the country since Panama has never had an official central bank. The coins are mostly used for everyday transactions, such as buying groceries, paying bus fares, or tipping service workers.

What does Panamanian balboa look like? The Balboa coins have various designs and motifs that reflect the historical significance and national symbols of Panama, such as the bust of Vasco Núñez de Balboa, the namesake of the currency, on the obverse of the 1 Balboa coin, and the coat of arms of Panama on the reverse.

The Panamanian balboa does not have any banknote issue, as the US dollar is used for large transactions and international transactions. The US dollar bills circulate freely in Panama and are accepted by all businesses and institutions. The US dollar bills are also known as private currency, as the Panamanian government does not issue them, but by the Federal Reserve System of the US. Source

Tuesday, May 21, 2024

How To Start Collecting Dollar Bills

Are you fascinated by the intricate designs and historical significance of paper currency? Collecting dollar bills might be the perfect hobby for you. Whether you're an experienced currency collector or a novice enthusiast, this comprehensive guide will help you embark on a dynamic journey into the world of American paper money.

1. Educate Yourself on Dollar Bill History

To truly appreciate your dollar bill collection, delve into the rich tapestry of American paper money history. Understand the evolution from large-sized notes to the modern currency we use today. Explore the stories behind significant changes, like the shift from gold and silver certificates to Federal Reserve Notes.

Familiarize yourself with historical figures featured on bills and the reasons behind their selection. Recognizing these nuances adds depth to your collection, transforming each note into a tangible piece of American history.

2. Define Your Focus

When diving into the captivating world of collecting dollar bills, the numerous options might seem overwhelming. Let's break down some key types of notes to help you find your focus:

  • Legal Tender Notes: A United States Note, or Legal Tender Note, was used from 1862 to 1971. Although no new notes have been issued since 1971, existing United States notes remain legally tender. Due to their scarcity in circulation, collectors often pay more than the face value for these notes.
  • National Bank Notes: Introduced during the Civil War, National Bank Notes were issued by chartered banks and backed by U.S. government bonds. While these notes weren't universally accepted as legal tender, they were deemed acceptable for most transactions involving the federal government.
  • Federal Reserve Notes: This currency is in use today and was introduced by the Federal Reserve System in its first release back in 1914.
  • Treasury Notes: This currency is also known as a "Coin Note." It was only circulated for a brief time during the 1890 and 1891 series. Valuable metals supported these notes and could be exchanged for gold or silver coins.
  • Denomination: You can focus your collection based on the dollar bill denomination, such as $1, $2, $5, $10, $20, $50, or $100. This approach allows you to explore the evolution of designs and security features within a specific value range.
  • Star Notes or Replacement Notes: Star notes are replacements for damaged or misprinted bills and are easily identified by a star next to the serial number. Collecting these adds an element of rarity, as star notes are produced in smaller quantities than standard notes.
  • Significant Figures: Some collectors specialize in acquiring notes that highlight specific historical figures. For example, notes that portray Abraham Lincoln or Alexander Hamilton can make for a captivating and historically rich collection.

In choosing your focus, consider what aspects resonate most with your interests. Whether it's the charm of obsolete bank notes, the historical depth of Legal Tender Notes, or the regional stories embedded in National Bank Notes, defining your focus adds a personal touch to your dollar bill collection.

3. Set a Budget for Your Dollar Bill Collection

As you embark on your dollar bill collection journey, establishing a budget is key. Determine a realistic spending limit, considering factors like rarity and historical significance. A well-thought-out budget ensures you enjoy collecting dollar bills without straining your finances.

It also guides you to make informed decisions, helping strike a balance between building a meaningful collection and maintaining financial comfort. Remember, the joy of collecting dollar bills should enhance your life, not burden it. So, set a budget that aligns with your passion and pocket.

4. Start with Everyday Circulation Currency

Begin collecting dollar bills organically by checking your everyday transactions for hidden gems. Glance through your change, and don't hesitate to ask local banks for any unique bills they may have. Starting with everyday circulation currency allows you to uncover surprises, like star notes or replacement notes, without significant effort or expense. It's a low-key way to introduce yourself to the thrill of finding intriguing bills in the most unexpected places.

5. Connect with Other Currency Collectors

Dive into the vibrant world of currency collecting by connecting with fellow enthusiasts. Online forums, social media groups, and local meet-ups are invaluable resources. Engaging with other collectors opens doors to valuable insights, trade opportunities, and a shared passion for the art of paper money.

Share your discoveries, seek advice, and enjoy the camaraderie of a community that understands the excitement of finding that elusive note. Networking not only enriches your knowledge but also transforms your collecting experience into a shared journey. Embrace the collective enthusiasm; after all, currency collecting is a conversation waiting to happen.

6. Explore Online Marketplaces and Reputable Dealers

Navigating online marketplaces for buying and selling dollar bills can be rewarding if done with caution. Here are some tips to guide you through the process:

  • Research Dealer Reputation: Before making any purchases, research the reputation of the dealer. Look for reviews, testimonials, and ratings from other collectors. Reputable dealers often have a positive track record within the numismatic community.
  • Check for Memberships in Numismatic Associations: Trustworthy dealers often belong to recognized numismatic associations or organizations. Membership indicates a commitment to ethical standards and professionalism in the field.
  • Review Detailed Descriptions and Images: Reliable dealers provide thorough descriptions and high-quality images of the dollar bills they offer. This transparency helps you assess the condition and authenticity of the notes before making a purchase.
  • Examine Return Policies: Ensure the dealer has a clear and fair return policy. This is crucial in case you receive a bill that doesn't meet your expectations or if there are any issues with the transaction. A reputable dealer should be transparent about their return process.
  • Verify Secure Payment Options: Look for secure payment options to protect your financial information. Reputable dealers offer trusted payment methods, providing you with a safe and secure transaction experience.

Remember, a little diligence in your online transactions goes a long way in securing a positive and enjoyable experience in expanding your dollar bill collection.

7. Organize And Protect Your Dollar Bill Collection

Properly organizing and protecting your dollar bill collection is essential for preserving its condition over time. Consider these tips for storing your collection the right way:

  • Create an Inventory: Keep a detailed catalog or inventory of your collection, listing factors like denomination, series, and any unique features. Organizing your collection not only helps you track your progress but also assists in identifying any gaps or specific items you're still looking for.
  • Avoid Direct Sunlight: Store your dollar bills in a secure and climate-controlled environment to prevent damage.
  • Use Protective Holders: Invest in acid-free holders, sleeves, or albums designed specifically for currency. These protective enclosures shield your dollar bills from environmental factors, preventing damage and preserving their quality.
  • Store Flat: If using albums or holders, store your notes flat rather than folded. This prevents creases and ensures the bills maintain their original crispness.
  • Handle With Clean Hands: The natural oils and dirt on your fingers can transfer to the notes, causing gradual damage over time. If necessary, use cotton gloves to handle your collection.
  • Regularly Inspect Your Collection: Periodically inspect your collection for any signs of damage or deterioration. Catching issues early allows you to take corrective measures and preserve the overall quality of your notes.

By following these storage tips, you not only protect the physical integrity of your dollar bills but also ensure that your collection remains a source of enjoyment for years to come.

8. Understand the Grading Process

Grading is a crucial aspect of collecting dollar bills, as it provides a standardized assessment of a note's condition. It involves evaluating the physical condition of a dollar bill, considering factors like wear, folds, and overall preservation. Professional grading services, such as PCGS (Professional Coin Grading Service), use a standardized scale to assign a grade.

Familiarize yourself with the grading scale used by the chosen service. This includes understanding terms like "Fine," "About Good", "Very Good," etc. Also, grading services provide guidelines on what constitutes wear, folds, or other imperfections. Study these guidelines to assess the condition of your notes accurately.

Graded notes generally command higher prices in the market. Understand how the assigned grade affects the value of your notes, helping you make informed decisions in buying or selling.

9. Stay Informed About American Paper Money

Keep your finger on the pulse of American paper money by staying informed. Regularly explore updates on new releases, design changes, and historical anecdotes related to U.S. currency. Follow reputable numismatic sources, engage in online discussions, and attend events or shows. This ongoing learning journey not only enriches your collection with the latest insights but also deepens your appreciation for the evolving narrative woven into each dollar bill.

Uncover the Beauty in Every Note

Collecting dollar bills is an engaging hobby that allows you to explore the rich history and designs of American currency. Whether you're drawn to large-sized notes, star notes, or historical banknotes, this dynamic hobby offers a world of possibilities. So, start your dollar bill collection today and embark on a journey filled with historical discoveries and fascinating conversation pieces.

Source

Saturday, May 18, 2024

Gold Coins Found On Kentucky Farm

 

 
A Kentucky man uncovered buried treasure on his farm. Man found over 700 gold coins dated back to the civil war times back when people would bury their coins during the war. 

Wednesday, May 15, 2024

Collecting U.S. Coins

Collecting U.S. coins is a popular numismatic pursuit, but deciding exactly how to collect them is not necessarily an easy task. Our nation's rich history and the eclectic artistry of its coinage have inspired many different approaches to collecting, with each option having a distinctive appeal.

Assembling a collection by denomination provides a nice overview of 200+ years of U.S. regular-issue coinage. Some denominations are familiar - cents, nickels, dimes and quarters are used every day. Others, like half dollars and dollars, are elusive, but still contemporary. Obsolete fractional issues, such as the once-popular half-cent, the Civil War-era 2-cent piece, the surprisingly useful 3-cent coin, and the short-lived 20-cent piece, are charming in their eccentricity.

Most U.S. denominations have experienced changes in their physical characteristics over time, and those variations can be the basis for collecting by size and composition. Dollars are a great example: during the 19th century, there were standard silver dollars, slightly larger Trade dollars and tiny gold dollars. In the 1970s, large copper­-nickel dollar coins were replaced with a smaller version, and those, in turn, gave way to this century's golden dollars (golden in appearance, not content).

Other denominations have been modified as well. There are large cents, and there are small cents. Three-cent pieces and 5-cent coins come in both silver and copper-nickel versions. Dimes and quarters switched from silver to copper­ nickel in 1965; half dollars did the same in 1971 after a brief, interim period of 40-percent silver.

Of course, money is more than just metal, and collecting by design type embraces the diversity of American coin design. A "type" is defined by its major motif, for example, Indian Head cents, Barber dimes or Peace dollars. The 18th, 19th and 20th centuries already offered an abundance of "types," but during the 21st century, state, territorial, and national parks quarters, and Sacagawea, Native American and Presidential Dollars, have taken design diversity to an entirely new level.

Where a type collection includes exactly one coin of each design, collecting by subtype involves multiples. Consider the Lincoln cent, which is fertile ground for subtype collecting. Over the course of more than a century, our most common coin has been made of bronze, zinc-plated steel, brass and copper-plated zinc. And it's had seven, different reverse designs—four in 2009 alone.

Subtypes can also be defined by partial design changes. For example, the word "CENTS" was added to the Liberty Head nickel in 1883, and there are "raised mound" and "recessed mound" Buffalo nickels of 1913.

Going beyond types and subtypes is the approach of concentrated collecting. The idea is to choose a compact set of coins that includes every major subtype within a series, every decade of the series' lifespan, and every mint that coined the series. For any series, there are many different ways to create a concentrated collection. For example, the following three coins constitute a concentrated collection of Standing Liberty quarters: 1917-D (Type 1), 1925(-P) and 1930-S. Alternatively, a 1917-S (Type 1), 1924-D and a 1930(-P) would serve the same purpose, as would a 1917(-P, Type 1),1927-D and 1930-S.

Countless other combinations are possible. Whatever specific pieces you choose, concentrated collecting allows you to capture the essence of a series with a small number of coins.

Learn more on this topic here...


Thursday, May 9, 2024

Five Traps to Avoid When Buying and Holding Precious Metals

Average investors may find their first purchase of physical gold and silver a little intimidating.

To be sure, bad actors have sold metals with lower purity or less precious metal content than claimed. Sometimes it requires special equipment or knowledge to detect such fraud. But there are many other ways for novice investors to be scammed.

TRAP #1: Cable TV Ads, Celebrity Spokesmen, and the “Bait and Switch”

If you watch any of the cable news channels, you are certain to have seen advertisements to buy gold or silver coins, especially inside a retirement account.

The companies behind the Cable TV ads typically use a celebrity spokesman and appear simply to be promoting a basic investment in gold or silver. However, when they get someone on the hook, they will try to make an upsell into so-called rare, special, limited edition, proof, or collectible (numismatic) coins.

Unfortunately, for anyone duped into buying these supposedly special coins – usually at the hands of high-pressure, commission-based salespeople – it may be decades (if ever) before the victim sees a return on their investment.

Because the prices charged are so high above the actual market value of the gold or silver, metal prices often must double or more before a purchase can get back to a break-even point on the investment.

The celebrities hired for these TV ads may not even realize they are complicit in a swindle. Like many others, they might not know enough about the precious metals industry to understand what is a good value and what is not.  However, naivete is no excuse for a celebrity spokeman's involvement with such sellers; these celebrities get paid a fortune for their endorsements.

The reason these TV-based dealers can afford to pay the celebrities, as well as their aggressive commission-based sales team, is that the profit margin in their dubious rare, proof, and special-edition coins is far above the margins for competitively priced bullion.

TRAP #2: Individual Scammers

In recent months and years, there have been many cases of scammers and thieves targeting precious metals. Several public warnings have been issued by the CIA, FBI, and NSA, regarding scam syndicates and terrorist organizations in this area.  Money Metals frequently warns customers about various scams we detect.

Some of the scammers will prey on the elderly, calling and harassing them into buying gold bullion bars or coins, sometimes using a fake business front to acquire cash or precious metals… or to get people to sell valuables for cash.

There have also been a variety of money laundering schemes.

At times, scammers may even present themselves as the IRS, the police, or another government authority and demand valuables to be turned over to them. 

Another common type of fraud is committed by random sellers online. They will simply steal the client’s payment and deliver nothing, or fulfill orders with fake or adulterated metal.

The above scenarios underscore the importance of buying, selling, or trading through reputable online dealers such as Money Metals Exchange.

A reputable company will be easy to contact or communicate with. They provide confirmation as the transaction moves through to completion, they get positive reviews from clients online, and they have established a good rating with the Better Business Bureau (BBB).  (That said, even dishonest companies have managed at times to maintain a good BBB reputation.)

TRAP #3: The Crooked Depository

Over the years, there have been multiple incidents involving corrupt depository operators that either raided a customer’s storage account or never deposited the metal the customer sent in the first place.

When storage customers finally want their metals to be returned to them, these corrupt depositories can operate as pyramid schemes. They manage to meet withdrawal requests until those requests outnumber new deposits.

When they do send metals, there can be long delays consisting of weeks or months. This is a red flag that signals the depository doesn’t actually have the customer’s metals on hand. They are working to acquire the metals needed to make the client whole.

A good rule of thumb is to only buy, sell, or store using a reputable precious metals depository that has an established public profile and good ratings.

TRAP #4: Phony Dealers that Fail to Deliver

There have been numerous instances of fake dealers that sell precious metals but never actually send the metals. Instead, they pocket the money.

The following are signs to be wary of…

  • Newly created websites.
  • Companies selling at popular online auction sites with no verified transaction history.
  • Sellers who are based in a different country.
  • Sites that look and sound a lot like other companies (but are not actually them).
  • Sellers who only want to receive payment in cryptocurrency or cash.
  • Random ads found on public forums.

TRAP #5: Home Invasions and Thieves

When you own bullion of any amount, especially significant amounts of precious metals such as gold bullion bars, gold coins, silver bars, silver coins, gold rounds, silver rounds, or even jewelry, it is always a good idea to not publicly brag about it. Keep it to yourself.

A home invader can access your home while you are there. They will threaten violence or death to compel you to turn over your valuables.

A thief will wait until you are not home and take your precious metals collection without directly threatening you.

There have been countless examples of precious metals enthusiasts being robbed.

To reduce your chances of being robbed or having your valuables stolen, do not post pictures and videos of your collectibles online and do not talk openly about what you own.

Owning precious metals is a great way to build a personal store of value, hedge against inflation, and maintain wealth over long periods. And when you own a lot of it, you feel more financially secure for your future.

It is normal to want to show it off, to be proud of your achievements, and to encourage others to get started. However, it’s safer to keep your investments private.

If you have a significant amount of precious metals, it is a good idea to store at least some of them in a reputable depository, such as the Money Metals Depository. This is a low-cost option (starting at less than $100 per year) that safely protects your valuable investments and reduces the risk of thieves, robbers, and home invaders.

When storing your metal collection in a proper depository, they are protected in a dedicated facility with top-of-the-line secure architecture, technology, and staff. And your metals will be fully insured against loss – something that may not be possible when storing at home.

Monday, May 6, 2024

Why Are Some Coins Painted Red?

 

 

Some junk silver coins are painted red. Junk silver quarters and junk silver dimes can be painted red. These coins were painted red so that a business owner could put them in the juke box and get their coins back when the money was collected.