Wednesday, August 5, 2015

Isaac Werner's "Currency"

Potatoes of many varieties, by Scott Bauer
In the late 1800s, as cash became increasingly scarce, neighbors bartered with each other, often swapping labor.  Before Isaac got a horse, he swapped his labor in exchange for neighbors' horses and plows.  Isaac was a talented carpenter, and he built houses and furniture to earn cash or exchange for plowing.  (See "Isaac's Dolly Varden," 12-28-2012 in the Blog Archives.)

Isaac also used his potatoes as a form of exchange.  In the spring he could barter or sell his seed potatoes, saved in his cellar from the previous season's crop.  In the summer as he dug potatoes, he often took them to town to exchange with merchants as credit for the merchandise he purchased, as well as receiving cash to pay other bills.  (See "Isaac's Potatoes," 2-17-2014 in the Blog Archives.) 

Earliest postage stamps
When he repaired and painted a buggy for a neighbor, the man set up a credit account at Doc Dix's post office store so Isaac could get the supplies he needed for the job.  When he ordered a sign painter's handbook for instructions for painting the buggy, he paid for the booklet by enclosing stamps. 

During the Civil War the use of postal money orders evolved to allow Union soldiers to send money home.  Sending cash through the mail was risky, and even stamps enclosed in lieu of money presented the danger of theft.  Registered letters, which had to be signed for at every point where the letter changed hands, offered some degree of security for sending cash through the mail.  However, the money order system initiated in 1864 offered the greatest safety.  The bill to establish the system passed through Congress without any serious debate.

Postal Money Orders from 1897
The image at left shows two US postal money orders from 1897 offered on e-bay for $490 and sold for "Best Offer."  The fee for the first money orders was 10 cents up to $10, 15 cents up to $20, and 20 cents up to $30.  Not every post office was authorized to offer postal money orders, the authority being based on the amount of business done by each post office.  Isaac recorded in his journal receiving money orders twice and also recorded using a money order to send payments.  Sometimes traveling salesmen, workers, and showmen used postal money orders payable to themselves almost as a form of travelers' checks.

In addition to the post office, express companies also got into the business of transporting money, primarily for banks but also smaller amounts for private citizens.  Following the example of the post office, American Express began selling money orders in 1881.  Isaac makes no mention in his journal of an American Express office.

This concludes the series on early forms of paper currency and substitutions of other means of exchange and barter.  You may read the prior blogs on the topic in the July 2015 archives.

1 comment:

The Blog Fodder said...

I learned about money orders. Made my day. thanks.