When did the USA begin to use the dollar as their unit of currency?

Answer 1

The history of the dollar in North America pre-dates US independence. 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 8 real coins or "Spanish Milled Dollars". Though several monetary systems were proposed for the early republic, the dollar was approved by Congress in a largely symbolic resolution on 8 August 1786. 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 "daler", an abbreviation of "Joachimsdaler" – (coin) from Joachimstal – 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. The term "dollar" was widely used in reference to a Spanish coin at the time it was adopted by the United States.

Until 1874 the value of the United States dollar was tied to and backed by silver, gold, or both. From 1792 to 1873, the U.S. dollar was freely backed by both gold and silver at a ratio of 15:1 under a system known as bimetallism. In this system, the dollar could be exchanged for 371.25 grains (24.06 g) of silver or 24.75 grains (1.60 g) of gold.

Because prices of 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 1800s, 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 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 (23.2 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 coin were useful in commerce.

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.

With the enactment 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.

Answer 2

On July 6, 1785 the USA adopted the dollar, but did not mint any until 1794.

Answer 3

the dollar, currency code usd, was adopted by the united states on July 6, 1785,the us dollar is the currency most used in international transactions.

Answer 4

Your answer: dollar was adopted by the United States on July 6, 1785.

Answer 5

From the very beginning, I think. I don't mean from July 4, 1776, but I believe it's the only currency the U.S. Government has ever issued.

I could be wrong; it happened once before.

Answer 6

Don't you love it when people copy and paste huge gobs of text from some site and still don't answer the question?

The first dollars weren't USED until they were MADE, not when some act of Congress authorized them. The first dollar coins were actually put into circulation in 1794.

You won't find a US dollar coin dated earlier than 1794 in even the most exclusive coin collection, because none exist.

Answer 7

Ugh.... Did you even read the article you referenced? The whole thing was a scam designed too ... make money from the decline in the dollar caused by overreacting to this tripe. It's a ploy to capitalize on greed and ignorance, and like most of this kind of scam, it worked.

Answer 8

Even before it was the USA, but officially on August 8, 1786.

Answer 9

The advent of currency in America is very much tied to the industrial revolution and the growth of trade. It was difficult to trade commodities for the reasons we discussed yesterday. The problem with moving to currency, however, was that it was a new system with few rules and those rules that existed were often vague and untested. The new government needed to establish consistency so that the economy would remain stable. These laws and changes were made over many years. As the US moved to create a national currency there was still the question of worth and stability. The bonds issued by the government to support the new US Notes were ok but many still feared the solvency of the government could be in jeopardy. Americans were still basically simple breed.

How was the use of the dollar originated?

In the late 1700's the Spanish had instituted the use of specie known as pesos. The Spanish had long mined the silver in Mexico, melting and creating bullion or ingots, The treasure ships stopped in the West Indies and often fell prey to pirates who spent their stolen treasure in the Southern Colonies.
The Triangle Trade brought Pesos to America as well, Molasses to Rum To Slaves
Pesos were known as pieces of eight because they were divided up into parts of eight called bits. The pesos resembled Australian currency called Talers, which the colonists had seen because Australia was also a colony of England, the term became so popular that Franklin and Hamilton decided to name the new currency Dollars,
The new Dollar was divided by units of 10, not 8, because it was easier.
How was money first issued in the colonies

The Constitution in Article 1, section 8 gives Congress the power to deal with money.
Article 1 section 10 further states that no state shall have these powers but it was basically understood at that time that the government could not print paper money.
If the Federal Government could not print paper money, who could?

State Banks - Banks chartered by states. These banks printed paper currency , mostly backed by gold or silver. Some banks abused this and printed large amounts of currency to be spent in far away cities. These wildcat banks presented a problem.
What did the federal government do at that time to regulate money?

Very little. The Bank of the United States, created by Alexander Hamilton and then destroyed by Jackson, acted as a department of the treasury. It had a federal charter and collected fees, taxes and made payments on behalf of the federal government.
What problems arose as result of this lack of supervision?

By the civil war there were 1,600 different banks issuing over 10,000 different types of currency. Each bank was supposed to base their currency on existing gold or silver reserves but this was often no the case. As a result lists of "bad notes" were circulated and often a person went to buy something and found they had bad currency. This meant that the money they had was now essentially worthless.
When did the Federal government start printing currency?

When the Civil War began in 1861 the north needed currency so Congress passed a law authorizing the printing of $60 million of demand notes. These were declare legal tender even though they had no gold or silver backing. In 1862 they printed another $150 million. These United States Notes were known commonly as Greenbacks because they were printed green on the front and back.
Why weren't people afraid the money would be worthless?

They were
What did the government do to support the Greenback?

Created a National Banking System. Rigorously inspected banks were chartered by the federal government. Each bank would issue national currency or the US Notes. They were uniform in appearance and backed by US Government Bonds.
State banks still existed and few could afford to buy the bonds and get a charter.
In 1865 Congress passed a 10% tax on all privately issued currency. This killed the state banks and left only greenbacks and national currency in circulation.
What did the government do to calm fears that US Notes weren't good?

It issued Gold Certificates (1863) printed in yellow. These became known as Yellow backs. They were backed by gold reserves. They were originally used by banks to settle differences but in 1882 the government printed $20 bills for general use.
It issued Silver Certificates (1886) in part to support prices for silver miners in the west. In 1878 the government began buying huge silver reserves and mint them into dollars. Later they kept the silver in reserve and printed silver certificates (1886).
Treasury Coin Notes were printed from 1890 to 1913 and were redeemable for gold and silver coin.
When did Congress start to back dollars with gold?

(1900) - This is known as the "Gold Standard" The government didn't actually have all the gold for all the money in circulation but it was acknowledged that all wouldn't redeem at one time.
Why was this done?

Support the currency and provide it with inherent value.
How much was a dollar worth in gold?

1/20.67 of an ounce
What are the advantages of being on the gold standard?

People feel more secure about their money.
Prevents the government from printing too much money and therefore value remains high, this can also be a disadvantage.
What are the disadvantages if the gold standard?

Growing economy needs a growing money supply which requires growing gold stocks. If these cannot be found then economic growth is stunted.
In event of financial crisis many may convert therefore depleting national reserves.
Why did the US go off the Gold Standard?

During the depression many began hoarding gold, banks began to fail and people began to cash in their dollars for gold. In 1933, fearing the government could not back the money supply a national emergency was decreed and we officially went off the gold standard.
What happened to those that had gold?

Anyone with more than $100 of gold had to file a treasury form.
Citizens, Banks and businesses were required to hand over their gold and gold certificates in exchange for Federal Reserve Notes and national currency. Those who did not hand it in had their gold and certificates confiscated.
What did it mean that we were no longer on the Gold Standard?

It meant we were on a inconvertible fiat money standard. The money supply cannot be converted to gold or silver. It is fiat, decreed, money.
Since 1975 Americans have again been able to own gold.
The government now manages the value of money by regulating the economy and the money supply.
What other types of currency exist today?

Silver Certificates - not redeemable
Travelers Checks

http://www.socialstudieshelp.com/Eco_MoneyOutline.htm

Answer 10

When i was born already has a dollar currency :))