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Coin Guide1890 $1,000 “Grand Watermelon” Red Seal United States bank note (Fr.379b)
Photos and descriptions used with permission and courtesy of Heritage Currency Auctions
The $1000 “Grand Watermelon” note pictured above is, as of this date, the most expensive US banknote ever sold. A world’s record price of $2,255,000 was paid for this note, more than double the previous record. Heritage Auction Galleries of Dallas, Texas (www.HA.com) brokered the private transaction between two collectors.
The only other known red seal Grand Watermelon is in the museum at the Federal Reserve Bank of San Francisco.
According to Greg Rohan of Heritage, “This note is graded PMG VF-35. It is pedigreed to the famous Albert A. Grinnell collection and was sold at auction by Barney Bluestone for $1,230 in November 1944. The anonymous seller of the record-breaking bill is described as “a private collector who owned the note for a number of years, and the anonymous buyer is very advanced and sophisticated East Coast collector of art and rare currency.”
The portrait on Grand Watermelon notes is of Civil War-era General George Gordon Meade who commanded Union Army troops at the Battle of Gettysburg. The Grand Watermelon notes are at the top of the list in the recently-published reference book, The 100 Greatest American Currency Notes, by Q. David Bowers and David Sundman.
Photos and descriptions used with permission and courtesy of Heritage Currency Auctions
A NewYork Times article from March 12, 1989 gives some general background on “Watermelon” notes, in this case one being sold in the Stack’s auction of the Howard W. Gunlocke Collection :
The bills are called ”Grand Watermelons” from the design on the reverse. Large numerals fill the middle and the zeros in the hundred-dollar and thousand-dollar notes are shaped and colored like large succulent watermelons, oblong and dark green with black streaks. Of course, the not-so-grand hundred dollar bill is known as the ”Watermelon”.
While ”Watermelon” notes are pretty, they have a rather nefarious past. Forget that the bills were printed at a time when most of the people would never earn a thousand dollars a year.
By looking closely, a clever little phrase can be seen on the front. Just to the right of the portrait of Gen. George Meade and just under the large gothic script reading ”One Thousand Dollars” are the words ”in coin.”
It is this little phrase that caused so much trouble and the early demise of the ”Watermelon” notes.
When miners suddenly struck silver within the great Comstock Lode in Nevada in the late 1800’s, the newly-rich silver barons lobbied Congress for some way to absorb the massive amounts of silver that were being unearthed.
Congress responded to the silver lobby by passing the Bland-Allison Act of 1878. That act ensured that the Treasury would buy two million dollars of silver each month at the highest market rate.
In the 1890’s, after more than 10 years of the Treasury propping up the silver market, the silver lobby wanted even more.
Thus was born the Legal Tender Act of July 14, 1890. In it, Congress legislated that a new issue of ”Treasury Notes” would be created, notes that could be used only for the purchase of silver.
Both Treasury Notes and Silver Certificates purchased silver from the silver barons but only the Treasury Notes could be redeemed in coin – gold coin. Silver Certificates could only be redeemed in silver.
Holders of large amounts of silver could now sell their bullion to the Treasury at the highest prevailing price and receive the lovely ”Grand Watermelons” in return.
These notes could then be used to buy gold coin from the Treasury. Because of the relative disparity in bullion values, anyone with large holdings of silver could make a fortune selling these Treasury Notes for gold.
By 1893, when Congress finally negated the benefits of the Treasury Notes, many fortunes had been made and the reserves at the United States Treasury were seriously depleted.
