History of the United States dollar Earth Wealth
earth-wealth.blogspot.in
The history of the dollar in North America pre-dates US independence. It began with the issuance of Early American currency called the colonial script, whereby the issuance of currency was equal to the goods and services in the economy. Even before the Declaration of Independence, the Continental Congress had authorized the issuance of dollar denominated coins and currency, since the term 'dollar' was in common usage referring to Spanish colonial eight-real coin or Spanish dollar. Though several monetary systems were proposed for the early republic, the dollar was approved by Congress in a largely symbolic resolution on August 8, 1785. After passage of the Constitution was secured, the government turned its attention to monetary issues again in the early 1790s under the leadership of Alexander Hamilton, the secretary of the treasury at the time. Congress acted on Hamilton's recommendations in the Coinage Act of 1792, which established the dollar as the basic unit of account for the United States. The word "dollar" is derived from Low Saxon "thaler", an abbreviation of "Joachimsthaler" – (coin) from Joachimsthal (St. Joachim's Valley, now Jáchymov, Bohemia, then part of the Holy Roman Empire, now part of the Czech Republic; for further history of the name, see dollar.) – so called because it was minted from 1519 onwards using silver extracted from a mine which had opened in 1516 near Joachimstal, a town in the Ore Mountains of northwestern Bohemia.
( Earth Wealth )
Because gold and silver in the open marketplace vary independently, the production of coins of full intrinsic worth under any ratio will nearly always result in the melting of either all silver coins or all gold coins. In the early 19th century, gold rose in relation to silver, resulting in the removal from commerce of nearly all gold coins, and their subsequent melting. Therefore, in 1834, the 15:1 ratio of silver to gold was changed to a 16:1 ratio by reducing the weight of the nation's gold coinage. This created a new U.S. dollar that was backed by 1.50 g (23.22 grains) of gold. However, the previous dollar had been represented by 1.60 g (24.75 grains) of gold. The result of this revaluation, which was the first-ever devaluation of the U.S. dollar, was that the value in gold of the dollar was reduced by 6%. Moreover, for a time, both gold and silver coins were useful in commerce. Earth Wealth
In 1853, the weights of US silver coins (except, interestingly, the dollar itself, which was rarely used) were reduced. This had the effect of placing the nation effectively (although not officially) on the gold standard. The retained weight in the dollar coin was a nod to bimetallism, although it had the effect of further driving the silver dollar coin from commerce. Foreign coins, including the Spanish dollar, were also widely used[1] as legal tender until 1857. Earth Wealth
With the enactment (1863) of the National Banking Act during the American Civil War and its later versions that taxed states' bonds and currency out of existence, the dollar became the sole currency of the United States and remains so today.
In 1878, the Bland-Allison Act was enacted to provide for freer coinage of silver. This act required the government to purchase between $2 million and $4 million worth of silver bullion each month at market prices and to coin it into silver dollars. This was, in effect, a subsidy for politically influential silver producers.
The discovery of large silver deposits in the Western United States in the late 19th century created a political controversy. Due to the large influx of silver, the value of silver in the nation's coinage dropped precipitously. On one side were agrarian interests such as the United States Greenback Party that wanted to retain the bimetallic standard in order to inflate the dollar, which would allow farmers to more easily repay their debts. On the other side were Eastern banking and commercial interests, who advocated sound money and a switch to the gold standard. This issue split the Democratic Party in 1896. It led to the famous "cross of gold" speech given by William Jennings Bryan, and may have inspired many of the themes in The Wizard of Oz. Despite the controversy, the status of silver was slowly diminished through a series of legislative changes from 1873 to 1900, when a gold standard was formally adopted. The gold standard survived, with several modifications, until 1971.
The sudden jump in the price of gold after the demise of the Bretton Woods accords was a result of the significant prior debasement of the US dollar due to excessive inflation of the monetary supply via central bank (Federal Reserve) coordinated fractional reserve banking under the Bretton Woods partial gold standard. In the absence of an international mechanism tying the dollar to gold via fixed exchange rates, the dollar became a pure fiat currency and as such fell to its free market exchange price versus gold. Consequently, the price of gold rose from $35 per troy ounce (1.125 $/g) in 1969 to almost $500 (29 $/g) in 1980.
Shortly after the gold price started its ascent in the early 1970s, the price of other commodities such as oil also began to rise. While commodity prices became more volatile, the average exchange rate between oil and gold remained much the same in the 1990s as it had been in the 1960s, 1970s and 1980s.
Fearing the emergence of a specie gold-based economy separate from central banking, and with the corresponding threat of the collapse of the U.S. dollar, the U.S. government approved several changes to the trading on the COMEX. These changes resulted in a steep decline in the traded value of precious metals from the early 1980s onward.
In September 1987 under the Reagan administration the U.S. Secretary of the Treasury James Baker made a proposal through the International Monetary Fund to use a commodity basket (which included gold).[citation needed]
The federal government began issuing currency that was backed by Spanish dollars during the American Civil War. As photographic technology of the day could not reproduce color, it was decided the back of the bills would be printed in a color other than black. Because the color green was seen as a symbol of stability, it was selected. These bills were known as "greenbacks" for their color and started a tradition of the United States' printing the back of its money in green. In contrast to the currency notes of many other countries, Federal Reserve notes of varying denominations are the same colors: predominantly black ink with green highlights on the front, and predominantly green ink on the back. Federal Reserve notes were printed in the same colors for most of the 20th century, although older bills called "silver certificates" had blue highlights on the front, and "United States notes" had red highlights on the front.
In 1929, sizing of the bills was standardized (involving a 25% reduction in their current sizes, compared to the older, larger notes nicknamed "horse blankets"). Modern U.S. currency, regardless of denomination, is 2.61 inches (66.3 mm) wide, 6.14 inches (156 mm) long, and 0.0043 inches (0.109 mm) thick. A single bill weighs about one gram and costs approximately 4.2 cents for the Bureau of Engraving and Printing to produce.
Microprinting and security threads were introduced in the 1991 currency series.
Another series started in 1996 with the $100 note, adding the following changes:
* A larger portrait, moved off-center to create more space to incorporate a watermark.
* The watermark to the right of the portrait depicting the same historical figure as the portrait. The watermark can be seen only when held up to the light (and had long been a standard feature of all other major currencies). earth-wealth.blogspot.in
* A security thread that will glow red when exposed to ultraviolet light in a dark environment. The thread is in a unique position on each denomination.
* Color-shifting ink that changes from green to black when viewed from different angles. This feature appears in the numeral on the lower right-hand corner of the bill front.
* Microprinting in the numeral in the note's lower left-hand corner and on Benjamin Franklin's coat.
* Concentric fine-line printing in the background of the portrait and on the back of the note. This type of printing is difficult to copy well.
* The value of the currency written in 14pt Arial font on the back for those with sight disabilities.
* Other features for machine authentication and processing of the currency.
Annual releases of the 1996 series followed. The $50 note on June 12, 1997, introduced a large dark numeral with a light background on the back of the note to make it easier for people to identify the denomination. The $20 note in 1998 introduced a new machine-readable capability to assist scanning devices. The security thread glows green under ultraviolet light, and "USA TWENTY" and a flag are printed on the thread, while the numeral "20" is printed within the star field of the flag. The microprinting is in the lower left ornamentation of the portrait and in the lower left corner of the note front. As of 1998[update], the $20 note was the most frequently counterfeited note in the United States.
On May 13, 2003, the Treasury announced that it would introduce new colors into the $20 bill, the first U.S. currency since 1905 (not counting the 1934 gold certificates) to have colors other than green or black. The move was intended primarily to reduce counterfeiting, rather than to increase visual differentiation between denominations. The main colors of all denominations, including the new $20 and $50, remain green and black; the other colors are present only in subtle shades in secondary design elements. This contrasts with the euro and other currencies, in which the main banknote colors contrast strongly with one another.
The new $20 bills entered circulation on October 9, 2003, the new $50 bills on September 28, 2004. The new $10 notes were introduced in 2006. The new $5 bills on March 13, 2008. Each will have subtle elements of different colors, though will continue to be primarily green and black. The Treasury said it will update Federal Reserve notes every 7 to 10 years to keep up with counterfeiting technology. In addition, there have been rumors that future banknotes will use embedded RFID microchips as another anti-counterfeiting tool.
The 2008 $5 bill contains significant new security updates. The obverse side of the bill includes patterned yellow printing that will cue digital image-processing software to prevent digital copying, watermarks, digital security thread, and extensive microprinting. The reverse side includes an oversized purple number 5 to provide easy differentiation from other denominations.
On April 21, 2010, the US Government announced a heavily redesigned $100 bill that featured bolder colors, color shifting ink, microlenses, and other features. It was scheduled to start circulating February 10, 2011. It will cost 11.8 cents to produce each bill. earth-wealth.blogspot.in
"The soundness of a nation's currency is essential to the soundness of its economy. And to uphold our currency's soundness, it must be recognized and honored as legal tender and counterfeiting must be effectively thwarted," Federal Reserve Chairman Alan Greenspan said at a ceremony unveiling the $20 bill's new design. Prior to the current design, the most recent redesign of the U.S. dollar bill was in 1996.
earth-wealth.blogspot.in
Earth Wealth
earth-wealth.blogspot.in
The history of the dollar in North America pre-dates US independence. It began with the issuance of Early American currency called the colonial script, whereby the issuance of currency was equal to the goods and services in the economy. Even before the Declaration of Independence, the Continental Congress had authorized the issuance of dollar denominated coins and currency, since the term 'dollar' was in common usage referring to Spanish colonial eight-real coin or Spanish dollar. Though several monetary systems were proposed for the early republic, the dollar was approved by Congress in a largely symbolic resolution on August 8, 1785. After passage of the Constitution was secured, the government turned its attention to monetary issues again in the early 1790s under the leadership of Alexander Hamilton, the secretary of the treasury at the time. Congress acted on Hamilton's recommendations in the Coinage Act of 1792, which established the dollar as the basic unit of account for the United States. The word "dollar" is derived from Low Saxon "thaler", an abbreviation of "Joachimsthaler" – (coin) from Joachimsthal (St. Joachim's Valley, now Jáchymov, Bohemia, then part of the Holy Roman Empire, now part of the Czech Republic; for further history of the name, see dollar.) – so called because it was minted from 1519 onwards using silver extracted from a mine which had opened in 1516 near Joachimstal, a town in the Ore Mountains of northwestern Bohemia.
( Earth Wealth )
Because gold and silver in the open marketplace vary independently, the production of coins of full intrinsic worth under any ratio will nearly always result in the melting of either all silver coins or all gold coins. In the early 19th century, gold rose in relation to silver, resulting in the removal from commerce of nearly all gold coins, and their subsequent melting. Therefore, in 1834, the 15:1 ratio of silver to gold was changed to a 16:1 ratio by reducing the weight of the nation's gold coinage. This created a new U.S. dollar that was backed by 1.50 g (23.22 grains) of gold. However, the previous dollar had been represented by 1.60 g (24.75 grains) of gold. The result of this revaluation, which was the first-ever devaluation of the U.S. dollar, was that the value in gold of the dollar was reduced by 6%. Moreover, for a time, both gold and silver coins were useful in commerce. Earth Wealth
In 1853, the weights of US silver coins (except, interestingly, the dollar itself, which was rarely used) were reduced. This had the effect of placing the nation effectively (although not officially) on the gold standard. The retained weight in the dollar coin was a nod to bimetallism, although it had the effect of further driving the silver dollar coin from commerce. Foreign coins, including the Spanish dollar, were also widely used[1] as legal tender until 1857. Earth Wealth
With the enactment (1863) of the National Banking Act during the American Civil War and its later versions that taxed states' bonds and currency out of existence, the dollar became the sole currency of the United States and remains so today.
In 1878, the Bland-Allison Act was enacted to provide for freer coinage of silver. This act required the government to purchase between $2 million and $4 million worth of silver bullion each month at market prices and to coin it into silver dollars. This was, in effect, a subsidy for politically influential silver producers.
The discovery of large silver deposits in the Western United States in the late 19th century created a political controversy. Due to the large influx of silver, the value of silver in the nation's coinage dropped precipitously. On one side were agrarian interests such as the United States Greenback Party that wanted to retain the bimetallic standard in order to inflate the dollar, which would allow farmers to more easily repay their debts. On the other side were Eastern banking and commercial interests, who advocated sound money and a switch to the gold standard. This issue split the Democratic Party in 1896. It led to the famous "cross of gold" speech given by William Jennings Bryan, and may have inspired many of the themes in The Wizard of Oz. Despite the controversy, the status of silver was slowly diminished through a series of legislative changes from 1873 to 1900, when a gold standard was formally adopted. The gold standard survived, with several modifications, until 1971.
The sudden jump in the price of gold after the demise of the Bretton Woods accords was a result of the significant prior debasement of the US dollar due to excessive inflation of the monetary supply via central bank (Federal Reserve) coordinated fractional reserve banking under the Bretton Woods partial gold standard. In the absence of an international mechanism tying the dollar to gold via fixed exchange rates, the dollar became a pure fiat currency and as such fell to its free market exchange price versus gold. Consequently, the price of gold rose from $35 per troy ounce (1.125 $/g) in 1969 to almost $500 (29 $/g) in 1980.
Shortly after the gold price started its ascent in the early 1970s, the price of other commodities such as oil also began to rise. While commodity prices became more volatile, the average exchange rate between oil and gold remained much the same in the 1990s as it had been in the 1960s, 1970s and 1980s.
Fearing the emergence of a specie gold-based economy separate from central banking, and with the corresponding threat of the collapse of the U.S. dollar, the U.S. government approved several changes to the trading on the COMEX. These changes resulted in a steep decline in the traded value of precious metals from the early 1980s onward.
In September 1987 under the Reagan administration the U.S. Secretary of the Treasury James Baker made a proposal through the International Monetary Fund to use a commodity basket (which included gold).[citation needed]
The federal government began issuing currency that was backed by Spanish dollars during the American Civil War. As photographic technology of the day could not reproduce color, it was decided the back of the bills would be printed in a color other than black. Because the color green was seen as a symbol of stability, it was selected. These bills were known as "greenbacks" for their color and started a tradition of the United States' printing the back of its money in green. In contrast to the currency notes of many other countries, Federal Reserve notes of varying denominations are the same colors: predominantly black ink with green highlights on the front, and predominantly green ink on the back. Federal Reserve notes were printed in the same colors for most of the 20th century, although older bills called "silver certificates" had blue highlights on the front, and "United States notes" had red highlights on the front.
In 1929, sizing of the bills was standardized (involving a 25% reduction in their current sizes, compared to the older, larger notes nicknamed "horse blankets"). Modern U.S. currency, regardless of denomination, is 2.61 inches (66.3 mm) wide, 6.14 inches (156 mm) long, and 0.0043 inches (0.109 mm) thick. A single bill weighs about one gram and costs approximately 4.2 cents for the Bureau of Engraving and Printing to produce.
Microprinting and security threads were introduced in the 1991 currency series.
Another series started in 1996 with the $100 note, adding the following changes:
* A larger portrait, moved off-center to create more space to incorporate a watermark.
* The watermark to the right of the portrait depicting the same historical figure as the portrait. The watermark can be seen only when held up to the light (and had long been a standard feature of all other major currencies). earth-wealth.blogspot.in
* A security thread that will glow red when exposed to ultraviolet light in a dark environment. The thread is in a unique position on each denomination.
* Color-shifting ink that changes from green to black when viewed from different angles. This feature appears in the numeral on the lower right-hand corner of the bill front.
* Microprinting in the numeral in the note's lower left-hand corner and on Benjamin Franklin's coat.
* Concentric fine-line printing in the background of the portrait and on the back of the note. This type of printing is difficult to copy well.
* The value of the currency written in 14pt Arial font on the back for those with sight disabilities.
* Other features for machine authentication and processing of the currency.
Annual releases of the 1996 series followed. The $50 note on June 12, 1997, introduced a large dark numeral with a light background on the back of the note to make it easier for people to identify the denomination. The $20 note in 1998 introduced a new machine-readable capability to assist scanning devices. The security thread glows green under ultraviolet light, and "USA TWENTY" and a flag are printed on the thread, while the numeral "20" is printed within the star field of the flag. The microprinting is in the lower left ornamentation of the portrait and in the lower left corner of the note front. As of 1998[update], the $20 note was the most frequently counterfeited note in the United States.
On May 13, 2003, the Treasury announced that it would introduce new colors into the $20 bill, the first U.S. currency since 1905 (not counting the 1934 gold certificates) to have colors other than green or black. The move was intended primarily to reduce counterfeiting, rather than to increase visual differentiation between denominations. The main colors of all denominations, including the new $20 and $50, remain green and black; the other colors are present only in subtle shades in secondary design elements. This contrasts with the euro and other currencies, in which the main banknote colors contrast strongly with one another.
The new $20 bills entered circulation on October 9, 2003, the new $50 bills on September 28, 2004. The new $10 notes were introduced in 2006. The new $5 bills on March 13, 2008. Each will have subtle elements of different colors, though will continue to be primarily green and black. The Treasury said it will update Federal Reserve notes every 7 to 10 years to keep up with counterfeiting technology. In addition, there have been rumors that future banknotes will use embedded RFID microchips as another anti-counterfeiting tool.
The 2008 $5 bill contains significant new security updates. The obverse side of the bill includes patterned yellow printing that will cue digital image-processing software to prevent digital copying, watermarks, digital security thread, and extensive microprinting. The reverse side includes an oversized purple number 5 to provide easy differentiation from other denominations.
On April 21, 2010, the US Government announced a heavily redesigned $100 bill that featured bolder colors, color shifting ink, microlenses, and other features. It was scheduled to start circulating February 10, 2011. It will cost 11.8 cents to produce each bill. earth-wealth.blogspot.in
"The soundness of a nation's currency is essential to the soundness of its economy. And to uphold our currency's soundness, it must be recognized and honored as legal tender and counterfeiting must be effectively thwarted," Federal Reserve Chairman Alan Greenspan said at a ceremony unveiling the $20 bill's new design. Prior to the current design, the most recent redesign of the U.S. dollar bill was in 1996.
earth-wealth.blogspot.in
Earth Wealth
