Encased postage in Kagin’s auction

An encased postage stamp collection will highlight Kagin’s Auctions March 9 American Numismatic Association National Money sale in Irving, Texas.

The Michigan Collection of encased postage stamps the firm believes is one of the most comprehensive sets ever as well as currently being the finest.

It includes 147 different varieties.

The collection was assembled over 25 years with the help of Kagin’s. The pedigrees include pieces from almost all the most complete and famous collections including Mayer, Kelly, Ford, Kagin and by extension, Wilcox, Dunham, Perl, Green and Lilly.

Encased postage was an entrepreneurial response to coin shortages caused by public hoarding during the Civil War. The lack of small change for public exchange led to the use of postage stamps, which in turn needed protection from handling.

These coin substitutes helped augment the inadequate Federal coinage during the conflict.

In 1862, paper money was not backed by gold and silver, and commerce was strained due to a shortage of coins that were being hoarded. Various attempts to alleviate the small change shortage included private companies issuing Civil War tokens, the government authorizing the use of postage stamps in trade and business issuing promissory notes for change.

Entering the fray was entrepreneur John Gault, who patented the use of enclosing a U.S. stamp from one cent to 90 cents within a round piece of brass. The stamp was sandwiched in between a roughly quarter-sized piece of brass with a hole cut in it (the frame) followed by mica to protect the stamp, a piece of cardboard, and finally, a brass backing. A button making machine pressed these items together, then bent the edges of the brass frame over the edge of the brass back. Many of the cases of early examples were silvered to make them look closer to real coins.

Gault sold the encased postage pieces to over 30 different merchants at about 20 percent over face value and another two cents each for stamping their advertising on the backs. Merchants and their products included J.C. Ayer & Company selling Sarsaparilla to “purify the blood”, White the Hatter, and retailer Lord & Taylor who survives today.

The first major offering of encased postage was in 1901 when S.H. and H. Chapman sold the Wilcox collection consisting of 88 different varieties. It was described at that time as “the finest collection ever sold.” The next significant offering was five years later when the Hiram E. Deats collection was sold by Ben G. Green. In May of 1914, the Ben G. Green Collection, containing 133 varieties (many of which were in the Wilcox Collection and from dealer Ed Frossard in 1890), was purchased in its entirety by William F. Dunham. The Dunham collection was auctioned in 1941 by B. Max Mehl and was, up to that time, the finest collection ever formed, with 163 recognized varieties. Dunham’s collection was acquired in its entirety by F.C.C. Boyd. In turn, numismatic dealer, John J. Ford acquired Boyd’s collection, and when Ford’s collection was sold by Stacks in 2004, it comprised 197 different pieces.

Other significant collections include those of the T. James Clarke collection in 1956; the Josiah K. Lilly collection, sold by Robert A. Siegel in 1967; the Arnold Perl collection, sold by Stack’s in December 1969; the Donald Kagin collection (150 different varieties), sold intact in 1983 and then resold in the “Abby” sale by Kagin’s Numismatic Auctions in February 1988.

Frederick Mayer purchased pretty much every variety he did not acquire from the Kagin and Ford collections, and when his collection was sold by Currency Auctions of America (owned by Heritage) in 2007, it contained 205 different varieties, the most complete ever assembled.

The Michigan Collection contains 147 different varieties and represents many of the finest single specimens that could be obtained for each denomination and from every merchant.

A complete variety set (238 pieces) has never been formed, and most likely never will be. Yet, many “complete” sets within the broader “full” sets are within the grasp of the determined numismatist. Encased postage may be collected by denomination, by merchant, by type of merchant (medicinal, dry goods, etc.), by locality of merchant or whatever way one chooses.

Another of the featured collections in Kagin’s sale is over 50 patterns from the Dr. George Barber collection. The star of this series is possibly the finest 1872 copper Amazonian half. These are followed by Dr. Barber’s so-called dollar collection.

No Kagin Auction would be complete without some Pioneer gold and selections from shipwreck treasure. This series is highlighted by two gold ingots from Kellogg & Co. and Harris, Marchand & Co from the S.S. Central America shipwreck.

The final session features the Carlson R. Chambliss collections of Federal Reserve and Federal Reserve Bank Notes. There are fully 84 FRBN varieties including the ever-popular St. Louis $50.

Free ANA memberships, references works and one percent credit back from the Kagin’s Auction Loyalty Program are all part of the Kagin Auction experience. The auction is available online at Kagins.com, or to reserve a free catalog, email auctions@kagins.com or phone 888-8KAGINS (852-4467).

More Collecting Resources

• The Standard Catalog of World Coins, 1901-2000 is your guide to images, prices and information on coinage of the 1900s.

• The Standard Catalog of United States Paper Money is the only annual guide that provides complete coverage of U.S. currency with today’s market prices.