U.S MONEY HISTORY & Trivia

This page provides a summary of the history of money in the United States. It discusses various forms of currency used over time, including wampum, paper money, coins, greenbacks, and the development of the banking system.

Key events mentioned include the establishment of the First Bank of the United States in 1791, the introduction of the dollar sign, and the creation of the Federal Reserve Bank in 1913.

The page also addresses the origins of common phrases related to money and provides answers to questions about money topics.

Before coins and paper bills, bartering was the most common method of purchasing goods. Bartering exchanges one good or service for something representing approximately equal value.

 
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• 1637 – Wampum, stringed clam shells used by American Indians, was declared legal tender In the Massachusetts Bay Colony.
• 1690 – Paper money was Introduced to the Massachusetts Bay Colony and eventually united the thirteen colonies.
• 1775-1783 – The Continental Congress Issued our first paper currency to fund Revolutionary War
• 1791 – First Bank of the United States is established in Philadelphia with a 20 year charter.
• 1792 – The U.S. Mint was created by Congress In Philadelphia.
• 1793 – U.S created the first coins produced by The U.S. Mint, copper cents. Gold and silver coins were produced as well.
• 1811 – The First Bank of the United States charter expires.
• 1812 – The charter for the Second Bank of the United States Is approved after the War of 1812, but not official until 1817.
• 1815-1824 – Market Revolution – Paper currency Issued by the bank is our first national currency.
• 1819 – The Supreme Court rules In McCulloch v. Maryland ruled that the chartering of the Second Bank of the United States was constitutional and that states cannot tax a federal government operation. Bank recalls paper money to balance the country’s Inflation. The result Is a series of bankruptcies, foreclosures and bank failures known as The Panic of 1819.
• 1832 – Andrew Jackson’s War President Andrew Jackson tries to dissolve the bank because he felt It overpowered the economy and helped the wealthy.
• 1834 – Jackson succeeded In withdrawing federal funds from the Bank, crippling It until It died In 1836.
• 1836 – Jackson became the
 first and only
 President censured
 for firing his treasury
 secretaries and 
withdrawing funds
 from the Bank.
• 1861-1865 – The Bureau of Engraving and Printing produced 3, 5,10, 25, and 50 cents paper notes (greenbacks) to pay Civil War soldiers because people hoarded coins.
• 1865 – The original purpose of the Secret Service was to find counterfeit money which made up 1/3 of the money In circulation.
• 1886 – Martha Washington Is the only woman whose portrait has appeared on a U.S. currency note.
• 1913 – Federal Reserve Bank is created.
• 1916 – Free money laundry services could be found in Washington, D.C., «where you could get It washed and ironed

Money Laundering Machine 1916 US Treasury (Image Public Domain)

 
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• 1929 – Stock market crashes, crippling the entire world economy and starting 10 years of the Great Depression. Recognized as Black Thursday.
• 1939-1945 – World War II kick starts the economy and subsequently the banking system, as Ibe country moves to support the war effort.
• 1946 – The first hank credit
card system Is
created by John
Biggins with his
“Charge-It* program.
• 1950s – Credit scoring 
Increases In popularity
 with use In consumer, 
mortgage, and
 micro-small business 
lending processes.
• 1970s – ATM machines 
began to populate,
 and with them the 
number of bank
 branches increase.
• 1976 – The original building of The First Bank of the United States Is restored for the Bicentennial celebration.
• 1976 – The First National Bank of Seattle Issued the first debit card to business executives with large savings accounts In 1978. By 1998, debit cards outnumbered check usage around the world.
• 1980s-1990s – U.S. commercial banks failed at about a 10% rate. Many still did not trust the system.
• 1980s – Computers and modem connections made it possible for people to pay bills or transfer money over telephone lines.
• 1990s – Electronic payments and fund transfers replace paper-based payments.
• 1996 – The California Stale Senate passed Bill 1959 which allowed for consumers to take out small emergency loans.
• 2008 – Banking Institutions came under fierce scrutiny as consumer and commercial markets floundered around the world In the wake of the financial crisis.
• 2009 – The U.S. Mint releases 4 new penny designs to commemorate the bicentennial anniversary of Lincoln’s birthday.
• 2010 – Bank trading operations are restricted and Increased transparency Is enforced with the Dodd-Frank Wall Street Reform and Consumer Protection Act.
• 2010 – Bitcoin (BTC) was introduced at an initial value of .08 cents per bitcoin (reached a new all-time high of $19,783.06 on December 17, 2017)
• 2012 – The financial crisis forces mortgage lending companies to enforce stronger lending criteria.

When was the first bank established in the US?

The First Bank of the United States was needed because the government had a debt from the Revolutionary War, and each state had a different form of currency. It was built while Philadelphia was still the nation’s capital. Alexander Hamilton conceived of the bank to handle the colossal war debt — and to create a standard form of currency.

Up to the time of the bank’s charter, coins and bills issued by state banks served as the currency of the young country. The First Bank’s charter was drafted in 1791 by the Congress and signed by George Washington. In 1811, Congress voted to abandon the bank and its charter. The bank was originally housed in Carpenters’ Hall from 1791 to 1795. The neo-classical design of the bank was intended to recall the democracy and splendor of ancient Greece. When you’re there, note the eagle which crowns the two-story portico. At the time of the bank’s creation the eagle had been our national symbol for only 14 years. The bank building was restored for the Bicentennial in 1976.

How does a bill-changing machine determine that your bill isn’t counterfeit?

Do you, like me, take it personally when one of your bills is rejected? Only my therapist knows just how badly this electro-magnetic authority figure makes me feel. In passing judgment, the machine checks for several characteristics. For instance, by passing a light through it, the changer examines your bill’s gross density (my Junior High School gym teacher would have scored high). It also uses light rays to check the alignment of thin lines embedded in your bill. A magnet generates a signal from the ink in your bill and it had better match the one characteristic of the ink used in printing real bills. The machine also measures the exact length of your bill. It’s a good thing the bill changer doesn’t also measure the sweat on my palms while I await it’s verdict. After 30 seconds I’ll sign any confession it prints out.
Source: HOW DO THEY DO THAT? By Caroline Sutton

What Does the Term “Down at the Heels Mean?
The Answer: To be down at the heels is to be in bad financial shape. The worn-away condition of the bottom of one’s shoes reflects a diminished bottom line. So being well heeled would present the reverse situation. Right? Wrong.

The heel in “well-heeled” originally belonged to a gamecock, a bird trained to fight other birds to the death while men wagered on the outcome. A bird’s owner would attach a sharp spur to its leg to make it deadlier in the cockfighting pit. The fowl was then said to be “well-heeled.”

In the western United States in the 19th century, in the same spirit, this expression was applied to men who were well armed. Ultimately being well heeled carried over to the financial realm, where it meant that one was financially armed to better deal with life. Think about all this if being well heeled makes you feel cocky.

— Source: HEAVENS TO BETSY! By Charles Earle Funk

 
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How Long Has Money Been Around?

As early as about 7,000 AD, 6,950 years before plastic credit cards, cattle were used as money in the first agricultural civilizations.

The first coins, pieces of bronze shaped like cattle, appeared 5000 years later. But their value was determined by their weight, making their use cumbersome. Coins as we know them, with their value imprinted on them, were first produced in Lydia in 800 BC. Somewhere in this period the Chinese briefly used paper currency, but the first consistent use of paper money was by the French in the 18th century–

Rich King Croesus of Lydians in Asia Minor issued the first money of gold – an oblong piece – in the 6th century. Soon the Greeks began minting money in the shape of discs, striking them with detailed high relief. Romans introduced the familiar serrated edges of today’s coins as a way to discourage the practice of shaving off thin slices. (Source: PANATI’S BROWSER’S BOOK OF BEGINNINGS)

Origin of Dollar Sign “$”

The sign is first attested in British, American, Canadian, Mexican and other Spanish American business correspondence in the 1770s, referring to the Spanish American peso, also known as “Spanish dollar” or “piece of eight” in British North America, which provided the model for the currency that the United States later adopted in 1785 and the larger coins of the new Spanish American republics such as the Mexican peso, Peruvian eight-real and Bolivian eight-sol coins.

The best documented explanation reveals that the sign evolved out of the Spanish and Spanish American scribal abbreviation “p^s” for pesos. A study of late eighteenth- and early nineteenth-century manuscripts shows that the s gradually came to be written over the p developing a close equivalent to the “$” mark

Origin of US Dollar Sign $

Wikipedia. Creative commons License

Additional Sources: Today I Found Out,  alt-usage-english.org and Oxford Dictionary.

Why do we “Pass the buck?”

The Answer: Hunters, of course, never pass the buck, preferring instead to take careful aim. However the rest of us are all occasionally guilty of not taking responsibility when we should. But what is this “buck” that we pass when we offer our pathetic excuses? Surely it can’t refer to the American slang for a dollar bill.

No, we don’t come that cheap. In fact, that hunter I mentioned is connected to the origins of the phrase. “Buck” was originally buckshot, which was used as a token in card games, being passed to the person whose turn it was to deal. One responsibility the dealer had was to place the first bet, which not everyone wanted to do. If they weren’t up to it, they could pass the buck. There you have it: your deal.

(Source: WHY YOU SAY IT by Webb Garrison)

cryptofinance n. The use of cryptography and privacy techniques to enable financial transactions that are secret and anonymous. Also: crypto-finance. [cryptography + finance] (Source Money Category @ Word Spy)
 
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