NOTES YOU ACQUIRE
on how you've acquired any notes you may now have in your collection or
accumulation of worldwide currency, probably you have already entered
the exciting and sometimes controversial realm of grading. Grading
assigning a condition of preservation to a note. Happily, banknote
is, in my opinion, generally easier to master than coin grading and
not quite so subject to broad interpretation and controversy as is the
grading of a coin. For one thing, a note is basically a two-dimensional
object, while a coin is three-dimensional. The grades that banknote
use are essentially analogous to that of the coin collector, although
70-point grading scale, where the state of UNCIRCULATED is broken up
eleven different substates (MS-60 to 70), is starting to rear its
ugly head in the world of banknotes, though seemingly restricted for
moment to the more rare U. S. and world notes.
if you're actively acquiring notes by buying or trading for them, you
to have a good working knowledge of grading so that you can make astute
decisions when purchasing or swapping these items. Also, you'll
want to get an idea of what the items you already have may be
To some collectors, this monetary value is of little concern and they
what they like (and what they are able to afford) without regard to the
value the item might bring in the collector market. In fact these
collectors may well derive the most pure pleasure from their
Most paper money collectors, however, like to think that what they're
may at some future date appreciate in value. Whether this will be
the case or not, as some issues do indeed go up in value while others
not or remain static, in order to determine a reasonable range of value
for most notes, it is necessary to be able to identify what you have
and be able to determine its state of preservation accurately using
widely accepted by the collecting community.
look at the subject of grading, keeping in mind that the collector must
develop his own standards based on his interpretation of the
system devised by the International Banknote Society, of which we will
speak later. We'll start with the lowest grades and work our way
up the scale. Be aware that you should examine a note out of its holder
under a strong light in order to be able to see the true condition of
bill. This is especially important for high-grade notes, as some light
creases and flaws are very difficult to detect except under the best
- a some
point in the future we will try to get some high resolution scans of
of notes in various grades.
- a virtual 'dog,' generally a raggy, dirty, torn and sometimes
poor-excuse of a banknote that has seen better days and is generally
only as a filler unless it is extremely rare.
- this is barely one step up, maybe not quite so raggy or dirty but
missing a piece or more of the note along with other defects.
grade still exhibits extreme limpness generally.
- like the grade 'GOOD' for a coin, GOOD really isn't so good although
it is possible to have a semi-attractive note that still grades only
due to the fact that it may have tears and small missing pieces as well
as heavy creasing. Most GOOD notes have seen a lot of circulation
and will show evidence of this such as many heavy folds, stains, edge
perhaps extending into the design, pinholes, a center hole from
- this grade will have fewer or less severe defects than the grade of
and a number of VG notes are in fact quite attractive, especially
where a note has been folded and refolded numerous times on the same
wearing a small hole through center and maybe causing a tear to appear
in the design. At this point I want to introduce the notion of
grades, that is, an instance where the note is clearly better than GOOD
but not quite VG. In this case, we might call the grade G-VG or
or even aVG (about very good). Experience is the best teacher for
this; after you've handled dozens of well-used notes, you may feel more
comfortable about split grading. Maybe you'll never feel comfortable
you might not even like the idea. We use split grades on occasion
and believe most dealers and collectors do. I am less enthusiastic
the use of a 70-point grading scale such as is used for
coins; more on this when we get there.
this grade exhibits still considerable circulation with a number of
folds, wrinkles, minor border tears (which cannot enter the design
of the note), and maybe a few pin or staple holes. At this point, a
is appearing somewhat attractive at least. After handling enough
notes, you'll come across some that appear to meet or exceed a certain
grade except for some defect. Usually, this is handled by
that grade to the note but following it with a description of the
For example, you might have a note that is at least a FINE except for
somewhat obvious stain in which case you would describe it as FINE but
stained or FINE but moderately stained or FINE but heavy corner stain,
etc., whatever the case might be. Naturally the value of a note
this would normally be lower than a defect-free note of the same grade.
Generally the higher grade a note is, the more 'picky' you should be
describing a defect that is not a normal characteristic of that
For example a VERY FINE note with a tiny tear or two might be listed as
VF but border tear or could just be downgraded to F-VF or "net F-VF,"
tear should still be described.
- Moving along, we start getting into the truly bright and more
notes in the VF grade and up. General characteristics of a VF
include: not more than a few vertical/and horizontal folds, a crisp
edges and corners can show slight wear but no tears are found in the
areas or anywhere else for that matter on the typical VF note. A slight
amount of soil or smudging can be present but this should really be
in my opinion.
FINE - This is an extremely attractive
showing only minor evidence of handling. According to the grading
standards of the International Bank Note Society, or IBNS, an EF note
exhibit 'a maximum of three light folds or one strong crease.' An
EF note is bright and without signs of soil. To the casual observer, it
should appear just about new. There will be only very minute wear on
corners or edges.
- The next step up from extremely fine, this is a note which would
uncirculated except for some very minor handling or use such as a
wallet fold where the note has a very light fold (not a creased
An AU note might have a slight bend or wrinkle from being counted. In
case, this remains a very bright, new-looking note. An AU-UNC
is often applied to notes with an extremely inconspicuous counting
or a note which might have a tiny corner nick, rippled surface of the
(due to humidity or some other environmental condition), or a note
a so-called dimple at the top of the security strip.
- New, as issued, with no defects with one possible exception. It
is possible to have an UNC note that has staple holes, this due to the
fact that some countries, including India and Pakistan, normally staple
quantities of notes together prior to issue. In this case, a
of 'UNC - usual staple holes' is the rule. Otherwise, an
note is just that. More so in regards to U. S. paper currency but also
occasionally used in describing UNC world notes are the adjectives
and 'gem.' I could see a particularly well-centered, attractive
perhaps earning one of these designations, however, I'm not convinced
need both terms. This mainly due to the concern that people would
next move toward a silly multi-point UNC grading system like that of
particularly U. S. coins. In fact this is starting to happen. Some very
rare U. S. and world notes are being "slabbed" (put in special sealed
and commercially graded by numismatic grading companies using the
opinion, but it seems like a convenient way to squeeze a lot more
for a "superb gem UNC MS-66 note." To newcomers to the numismatic
community, "MS" refers to mint state (i. e. Uncirculated) and the "66"
part indicates the relative "grade of uncirculation" with 60 being the
lowest and 70 the ultimate or theoretically "perfect" note. About
Uncirculated would range from 50 to 59, etc. This system has been
in use for a number of years now in the coin business. The worst
part is the difference in a coin's value from a single key grading
(say MS-65 to MS-66) can be thousands of dollars for a "rare"
This great difference in perceived value by some is why the whole
system is controversial by nature because grading, is, in the final
subjective (i. e. "beauty is in the eye of the beholder"). I believe a
note will stand on its own; if it's hard to find, attractive, and
sought by collectors, it's going to bring a better price. Many
notes are also common, but so attractive that they are always eagerly
up by enthusiastic collectors. But, I digress...
to perhaps bear in mind, the grading system for U. S. notes is similar
in many ways to that of world notes, but it has been my experience that
the world system is generally more conservative, particularly for the
grades. I have seen ads like "UNC - 1 fold." What does that
mean? Sounds like an EF or AU note to me (EF if creased, AU if
a light fold or "wallet bend").
point - notes, like coins, have sometimes been cleaned or had their
improved in some way. Some collectors have no problem with this, others
feel, as with coins, that the items shouldn't be altered in any way.
notes, alterations can include actually washing the note (literally
money!"), trimming it, erasing graffiti, pressing the note, mending
etc. The buyer should be aware that a note can be washed and pressed to
improve its grade and a note altered in this way should not command the
price of a note naturally appearing in this grade. A word of advice on
mending tears, if you are inclined to mend tears, please don't use
tape. Sooner or later it makes a mess of whatever its been taped to as
it turns yellow and brittle. If you feel you need to tape a tear, use
permanent translucent tape that's now widely available.
this clarifies grading a little if you're a beginner or at least serves
to demonstrate my interpretation of it and what kind of grading
you should expect and demand from my company. Clients have been,
I am happy to report, very pleased with the quality of service
as the return rate for notes has been a tiny fraction of far less
than one percent. Indeed, most returns are due to a collector
accidentally ordered an item which he/she already had in his/her
With grading under your belt, you can then start to determine a
range for your notes.