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The "real" value of banknotes...


jb1967

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I am wondering why a banknote (current issue, not an older one that we could consider rare) can be sold with so much mark up value.

 

Take a 1 Nafka from Eritrea. On the banking market it is worth less than 10 US cents. You pay 1 to 2 dollars for an unc item, which is probably fair. But why does the 5 nafka sell for 3 to 5 dollars (worth les than 40 US cents) and the 10 nafka for 5 to 6 dollars (worth less than a dollar) ??? It may be hard to get some UNC notes (if not easier...) from any particular country, but why does the diffrence between values follow a logarythmic progression (it means skyrocketing)?

 

Now look at this CONGO DEMOCRATIC 100 FRANCS 2000 P-92 UNC for 60 US dollars (worth less than 2.00 dollars at the bank). As nice as the note can be, who will buy this unless he has more money than he can count ??? In some cases, you may pay less for a painting and it would be unique...

 

I don't want to compare to older non-circulating issues. The question is totally different.

 

Just wondering.

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Simple: demand and how hard it is to get it out from the country.

 

Taking the example of current circulating Russian rubles, both coins and banknotes, due to dumb restrictions in the Russian Federation laws, you "cannot" legally take out ANY Russian currencies. Well I DID managed to take some out, but I guess the point is, you cannot take out as much as you would like. The same applies to post office as they do have crazy checkers.

 

Indeed, there are plenty of supply in the country, but to get it out from the country is a completely different issue. I am not too sure what the laws are in Africa, but I believe that might be the case.

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I often took it for granted that dealers often multiply the face value by a factor. I mean, they too have to make their share of profit, else why would they exist?

 

It can easily be from 1.25 to 5 times the face value of the banknotes. But often I found that the higher the face value of a particular banknote as well as the availability of such often reduces the scalar factor.

 

I am actually mystified over the price of the Congo banknote. I just gave a check on banknotes.com and it seems like they only have a trial version of such, and a Congo 200 Francs is around 12USD.

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I also want to add that if a series of banknotes (say 1, 5 and 10 of the same denomination) are worth less than 50 cents; the individual notes should'nt sell for five and ten times the price of the first note in the series. Why should the profit be 125x the face value for the 1 and 200x for the next?

 

I have nothing against profit (I would'nt have 2000 diff. notes in my collection if so...) but it seems we are touching something like an emotional (versus rational) string here.

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I think you also have to take into effect that, most people don't know which countries money has been devalued.

 

For example if someone on ebay was selling a Mexico 100,000 Peso note from 1991. Lets say the seller has the note listed for $500. So the potential buyer goes to XE.com and runs the conversion. XE says the note is worth almost $9,000. And the buyer puts in a bid for $500 and wins the banknote. The average person doesn't know that Mexicos money went through devaluation in 1994. And they get taken!!! I have seen this happen a few times.

 

I would also have to agree with GX that demand and what a seller can actually get for the note makes a difference also.

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Sometimes it is hard to get the banknotes in uncirculated condition. I have for some month tried to get the new 50kr and 1000kr banknotes from Sweden. As I live in Sweden it would seem easy to get, but no it is very hard even to see the new banknotes! If you get hold of one it has already been folded at least once :ninja:

As the national bank is not open for the public and all banks use cash mashines that they can not open to look inside, it is indeed very difficult to get the new banknotes in perfect condition. I have after three month of hard trying been able to get one 50kr bankknote pefect uncirculated and three almost unc, and two 1000kr banknotes almost unc. I hope to find at least one 1000kr in uncirculated as they are really cool with the moving hollogram device.

//Joakim

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Sometimes it is hard to get the banknotes in uncirculated condition. I have for some month tried to get the new 50kr and 1000kr banknotes from Sweden. As I live in Sweden it would seem easy to get, but no it is very hard even to see the new banknotes! If you get hold of one it has already been folded at least once  :ninja:

As the national bank is not open for the public and all banks use cash mashines that they can not open to look inside, it is indeed very difficult to get the new banknotes in perfect condition. I have after three month of hard trying been able to get one 50kr bankknote pefect uncirculated and three almost unc, and two 1000kr banknotes almost unc. I  hope to find at least one 1000kr in uncirculated as they are really cool with the moving hollogram device.

//Joakim

 

Interestingly, most banks I've tried around my area don't have real UNC notes. They always seem to have a mark from being counted by a machine, so it's always UNC-. It seems that you just can't get an original UNC single or bundle without knowing someone at a bank that happens to be getting them.

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Sometimes it is hard to get the banknotes in uncirculated condition. I have for some month tried to get the new 50kr and 1000kr banknotes from Sweden. As I live in Sweden it would seem easy to get, but no it is very hard even to see the new banknotes! If you get hold of one it has already been folded at least once  :lol:

As the national bank is not open for the public and all banks use cash mashines that they can not open to look inside, it is indeed very difficult to get the new banknotes in perfect condition. I have after three month of hard trying been able to get one 50kr bankknote pefect uncirculated and three almost unc, and two 1000kr banknotes almost unc. I  hope to find at least one 1000kr in uncirculated as they are really cool with the moving hollogram device.

//Joakim

 

 

Quite surprise to hear that it is difficult to get uncirculated notes from the banks. In Singapore, our banks will have all the new banknotes during the Chinese New year period for everyone to change. That is to allow people to give "red packet" or "ang pows" to children during this festive season. This has been a Chinese traditional practice during the Chinese New Year. :ninja:

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Quite surprise to hear that it is difficult to get uncirculated notes from the banks. In Singapore, our banks will have all the new banknotes during the Chinese New year period for everyone to change. That is to allow people to give "red packet" or "ang pows" to children during this festive season. This has been a Chinese traditional practice during the Chinese New Year.  :lol:

 

That I can agree. I received some crispy notes in the past but NICELY FOLDED in the middle thanks to the angpow - they should make angpow like Japanese version - envelop version :ninja:

 

It is VERY ironic how the Japanese banks worldwide, including the Japanese bank in Moscow had ULTRA CRISPY $100 bill notes that I never saw in my life before - and most definately in running sequence too :cry:

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