Danger, Danger, Danger!
Per the city code, all masonry chimneys for wood stoves require a 2" gap between the chimney and any combustible material. Having the carpet on the upstairs floor laying right next to it seemed a bit dangerous, so I spent my Sunday morning cutting the carpet away, as well as cleaning all the crud that accumulated between the joists and chimney thoughout the years. While doing that I found some interesting collection of comics from 1934. Here's the "after" picture of the project. The reddish glow is from the lighting from below.
I still need to apply some sort of frame around the carpet on the floor, as well as add some fire resistant insulation to fill that gap. I did some research and found one local wood stove supplier has this insulation, but it's about $20 a foot!