Tuesday, 20 November 2007

Paper Money History: Canada and USA The Humble Beginnings

Canada The Humble Beginnings

Around the mid 17th Century people were trading by batter in Canada, this was not because there was no other means of currency available but because it was always in short supply. Attempts were made to ship French silver coins over, but these were always hoarded by the merchants who used them to pay taxes and buy European goods. As coins became crucially more short in the new colony the ultimate solution was to issue paper money. The Canadians did there's in style and used playing cards. These cards had the words "Bon pour" noted behind it meaning "Good For", the governor of the day , Jacques de Meuiles, commanded all to honor these cards, which were emergency notes issued to the soldiers in 1685 and when the Kings ship arrived in the Fall the holders of the cards redeemed them for coins.

USA The Humble Beginnings

In 1690 The Massachusetts Bay Company became the first region in the US to issue paper money as circulating currency, this was issued first to returning soldiers from a mission to Quebec (Canada), that's an interesting point to note as only 5 years earlier that region had been issuing emergency notes to its starved soldiers!
The interesting development about this one is that the notes could be used to pay taxes and was also accepted as legal tender. Other states in America soon copied this practice.
Currency was issued in 2,5,10,20 shillings and 3,5,10 pounds.

It seems that in order to prevent the starvation of the armies of these to colonies, New England and New France were the reasons that the governments of the day resorted to using paper money, a very humble beginning.

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