Dr. Sol Taylor

What's With the $2 Bill?

By Dr. Sol Taylor
"Making Cents"
Saturday, June 14, 2008

he Bureau of Engraving and Printing prints $2 bills — but only about 1 percent of its monthly production are these bills. Some months the production is less than 1 percent or even zero.
    The demand, if you can call it that, comes from the various Federal Reserve banks (there are 12 of them in the U.S.) when their existing supply runs low or runs out. Some areas of the country use more of the notes than others, so the demand is localized.
    One common myth is that $2 bills have some numismatic value. They do not. The ones issued in 1953 and earlier with the red seal and serial numbers are worth at least $4 each and more in crisp, new condition. The notes from 1976 — the bicentennial notes — are worth face value even in crisp new condition. This includes the notes which were postally cancelled on the date of issue — April 13, 1976. These notes are available from dealers for less than $3 a note, with a few exceptions where the notes also have some important signatures; commemorative stamps which issued July 4, 1976; or various other combinations. The last series, known as 2003A, are the current notes and are not worth any premium over face value.
    The denomination was started in 1862 with the issuance of our first national currency. These notes are very scarce in any grade and very valuable in crisp new condition. In 1869, Thomas Jefferson was added to the design and it was known as a "Treasury Note." In 1874 the design was modified, and the note was known as a "United States Note."
    After a few more design changes in 1896, the Educational Series of notes appeared and were also silver certificates — they were backed by deposits of silver bullion and redeemable in silver. The last of the large sized notes was issued in 1918 as a Federal Reserve Bank Note. The reverse featured a World War I battleship and is often referred to as the "Battleship Note."
    The small-sized notes, which included all denominations, first appeared in 1929. The $2 bill was issued as "United States Note" with a red Treasury seal and red serial numbers and a design similar to the current design with Monticello on the reverse. The final issue of this type of note was in 1963 with the motto "In God We Trust" added to the reverse.
    Earlier issues of 1929 and 1953 showed Jefferson on the front and his home, Monticello, on the back. The 1976 note however featured the famous portrait of the signers of the Declaration of Independence on the back.
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    The impact of the $2 bill is seen in certain areas where it is specifically used in quantities to stimulate the local economy. Geneva Steel in Utah County paid its employees in $2 bills as bonuses in 1989. In 1977, Clemson University football fans stamped thousands of $2 bills with the team's tiger paw logo and spent them locally showing local merchants their impact on the economy.
    The other side of the story is one from a Taco Bell — date and location not known, but verified by Snopes.com) — that a customer presented a $2 for payment and was detained until the security officer indicated the note was real U.S. money.
    In a more publicized event at a Best Buy in 2005, a customer offered 57 new $2 bills (serially numbered) in payment and not only was detained but arrested until the police could intervene and certify, or at least verify, that $2 bills are real U.S. money.
    Only last year I paid with $2 bills at a few New Jersey businesses and in each case got the bill looked at by the manager or another person for reassurance. Since they so rarely appear in commerce, clerks and especially young salespeople are not sure of what to make of them.
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    Some years ago, Canada stopped making $1 bills and upped production of $2 bills. Canada also had been issuing $1 coins every year since the 1930s, so people were used to seeing $1 coins in circulation.
    That ended the life of Canada's $2 bills, and when the Loon $1 (or "Loonie") was introduced several years ago, these coins filled the niche of the old $1 bill. Then Canada also issued a Polar Bear or "Toonie" $2 coin and they, too, fell right into the local commercial channels. Public transit systems, parking meters, cash registers and coin counting machines are all receptive to the $1 and $2 coins.
    Since the United States has tried to get consumers to accept $1 coins, all attempts have failed. The Eisenhower dollars, Susan B. Anthony dollars, the Sacagawea dollars and the new Presidential dollars are not making their way into the cash registers.
    As long as the Bureau of Engraving and Printing continues to make $1 bills (about half of its monthly production output), the paper dollar will survive. If the $1 bill fades away, the $2 bill will fill that niche until we can go to $1 and $2 coins as have Canada, Great Britain and the European Union countries.
    The BEP sells $2 bills in special formats, such as uncut sheets of from 12 notes to 32-note formats, at more than double the face value. They are suitable for framing and make nice wall hangings.
    In 2000, the BEP made up 9,999 sets of $2 bills from each of the 12 Federal Reserve districts, all starting with the serial number "2000," and sold these sets at a premium above the face value. Notes with a star in the serial number are also packaged and sold in sets for a premium.
    The BEP is open to the public, and its sales division offers these and many other products for purchase. The BEP also sets up shop at major coin conventions and demonstrates some printing methods such as the old spider press to print souvenir cards.
    There are fantasy $3 bills — which are not real and should not confuse anyone with the real $2 bills. Counterfeit $2 bills are virtually unknown. However, some enterprising counterfeiters have been known to take real $2 bills and skillfully alter them to appear to be $20 bills.