31 facts about the early history of the US dollar
Today we all know that the US dollar is a sign currency known to people all over the world. How and why did it appear, and why do we call it “dollar” or “buck”? How did the early history of the dollar help shape the modern world?
For the early colonists, the currency could be said to be generally available.
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Officially, the money was denominated in pounds, shillings and pence, but in reality it was different. There was often not enough cash, and the colonists had to be resourceful for making calculations. At different periods, they used tobacco, beaver skins and necklaces made of shells instead of money. Some colonies even tried to release their own currency, many of which did not survive.
As it turned out, the Spanish dollar was often the most common form of cash — and therefore the US currency ended up being expressed in dollars.
During the American revolution of 1775, the Continental Congress issued money, known as the Continental Currency, in an attempt to finance the war. The government printed too much money, and they quickly depreciated.
Just five years later, after rampant inflation, the Continental currency was worth 2.5% of its nominal value. Benjamin Franklin rightly pointed out that the depreciation of the Continental currency actually became a tax on the payment of war. Punished were the holders of the currency - ordinary people who have lost a huge amount of purchasing power. Interestingly, the phrase “Broken grosz is not worth it.”
The collapse of the Continental currency is probably the first thing that was taken into account when writing the Constitution. In addition, a clause was added in Section 10 of Article 1 to exclude a repetition of such a collapse in the future. An entry was made that states were not allowed to “mint a coin; issue credit cards; (or) pay debts with anything other than a gold and silver coin. ”
Thus, the Monetary Act of 1792 made the US dollar a conventional unit of currency. The United States Mint was authorized to supervise the minting of coins, and the Act also established the death penalty for counterfeiting coins minted by the Mint.
In the 19th century, the dollar has a new nickname.
Different sums of money were measured in animal skins, especially in the Great Lakes region. One particular source mentions that in 1851, the muskrat skin in Ohio cost $ 0.25, and the fallow deer skin cost $ 0.50. Meanwhile, the skin of a deer (in English “bucks”) cost exactly one “almighty dollar” - and therefore the word “bucks” has become synonymous with the US dollar.
Before the Civil War, private banks throughout the country issued their own paper currencies.
With about 10,000 such currencies in circulation at the time of the outbreak of war, governments soon found it very inconvenient to try to pay off debts with such a large amount of money. As a result, the ten-dollar bill became the first official paper currency issued by the government in 1861 to finance the war.
The North began paying debts in a currency called greenback, while the Confederation of States also issued its paper currency. The latter had lost its value by the time the Confederation lost the war.
Around this time, the fake problem of greenbacks and all privately traded banknotes was widespread. At that time, more than 1/3 of bills were fake.
Complicated fake operations were carried out in British Canada, and some bank minters even fostered counterfeiters using plates and dies from their day job.
To solve this problem, the Secret Service was created in 1865.
The fight against counterfeit money has come a long way since the end of the 19th century. It is estimated that today less than 0.01% of banknotes are counterfeit.
Before the dollar
For the early colonists, the currency could be said to be generally available.
')
Officially, the money was denominated in pounds, shillings and pence, but in reality it was different. There was often not enough cash, and the colonists had to be resourceful for making calculations. At different periods, they used tobacco, beaver skins and necklaces made of shells instead of money. Some colonies even tried to release their own currency, many of which did not survive.
As it turned out, the Spanish dollar was often the most common form of cash — and therefore the US currency ended up being expressed in dollars.
Revolution
During the American revolution of 1775, the Continental Congress issued money, known as the Continental Currency, in an attempt to finance the war. The government printed too much money, and they quickly depreciated.
Just five years later, after rampant inflation, the Continental currency was worth 2.5% of its nominal value. Benjamin Franklin rightly pointed out that the depreciation of the Continental currency actually became a tax on the payment of war. Punished were the holders of the currency - ordinary people who have lost a huge amount of purchasing power. Interestingly, the phrase “Broken grosz is not worth it.”
The emergence of the dollar
The collapse of the Continental currency is probably the first thing that was taken into account when writing the Constitution. In addition, a clause was added in Section 10 of Article 1 to exclude a repetition of such a collapse in the future. An entry was made that states were not allowed to “mint a coin; issue credit cards; (or) pay debts with anything other than a gold and silver coin. ”
Thus, the Monetary Act of 1792 made the US dollar a conventional unit of currency. The United States Mint was authorized to supervise the minting of coins, and the Act also established the death penalty for counterfeiting coins minted by the Mint.
Almighty bucks
In the 19th century, the dollar has a new nickname.
Different sums of money were measured in animal skins, especially in the Great Lakes region. One particular source mentions that in 1851, the muskrat skin in Ohio cost $ 0.25, and the fallow deer skin cost $ 0.50. Meanwhile, the skin of a deer (in English “bucks”) cost exactly one “almighty dollar” - and therefore the word “bucks” has become synonymous with the US dollar.
Civil War
Before the Civil War, private banks throughout the country issued their own paper currencies.
With about 10,000 such currencies in circulation at the time of the outbreak of war, governments soon found it very inconvenient to try to pay off debts with such a large amount of money. As a result, the ten-dollar bill became the first official paper currency issued by the government in 1861 to finance the war.
The North began paying debts in a currency called greenback, while the Confederation of States also issued its paper currency. The latter had lost its value by the time the Confederation lost the war.
The problem of falsification
Around this time, the fake problem of greenbacks and all privately traded banknotes was widespread. At that time, more than 1/3 of bills were fake.
Complicated fake operations were carried out in British Canada, and some bank minters even fostered counterfeiters using plates and dies from their day job.
To solve this problem, the Secret Service was created in 1865.
Today's Dollar
The fight against counterfeit money has come a long way since the end of the 19th century. It is estimated that today less than 0.01% of banknotes are counterfeit.
Source: https://habr.com/ru/post/322798/
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