federal currency

The legal currency of the United States. Its coins are the gold eagle of ten dollars, half and quarter eagles of proportionate value. The silver dollar of one hundred cents, its half, quarter, tenth, and twentieth parts. The coin of ten cents value is called a dime, that of five cents, a half-dime. The lowest coin in common use is the copper cent. Half-cent coins have been made, but none of late years. In the commercial cities and along the sea-board, Spanish coins of a dollar and the fractional parts of a dollar are very common, and pass currently for their original value, except at the Custom Houses and Post Offices, where, by a recent ordinance, the quarter dollar and its parts are only received at twenty-five per cent. discount.

Previous to the adoption of our Federal currency, pounds, shillings, and pence were used. But this currency became unstable, in consequence of the great depreciation which took place in the paper money issued by the colonies.

In the year 1702, exchange on England was 33 1/3 per cent. above par; and silver and gold bore the same relative value to paper money. The depreciation in the latter continued to increase until, in the year 1749, £1100 currency was only equal to £100 sterling, or eleven for one. In 1750, a stop was put to the farther depreciation of the money of the province of Massachusetts by a remittance from England of £183,000 sterling, in Spanish dollars, to reimburse the expense the province had been at in the reduction of Cape Breton in the old French war. The depreciated money was then called in, and paid off at the rate of a Spanish dollar for 45 shillings of the paper currency. At the same time a law was made fixing the par of exchange between England and Massachusetts at £133 1/3 currency for £100 sterling, and 6 shillings to the Spanish dollar.

The difference of exchange, or depreciation of the paper money, regulated in the same manner the currencies of the other colonies. Throughout New England, as has been before stated, it was 6s. to the dollar of 4s. 6d. sterling. In New York, 8s., or about 75 per cent. depreciation. Pennsylvania, 7s. 6d., or about 66 per cent. depreciation. In some of the Southern States it was 4s. 6d. to the dollar, and accordingly no depreciation. In Halifax currency, including the present British provinces, it was 5s. to the dollar, or about 11 per cent., etc. etc. The old system of reckoning by shillings and pence is continued by retail dealers generally; and will continue, as long as the Spanish coins remain in circulation.

In consequence of the above named diversity in the colonial currencies, in New England the Spanish real of 1/8 of a dollar or 12 1/2 cents is called ninepence; in New York, one shilling; in Pennsylvania, elevenpence or a levy; and in many of the Southern States, a bit. The half real of 1/16 of a dollar is called in New York a sixpence; in New England, fourpence ha'penny, or simply fourpence; in Pennsylvania, a fip; and at the South, a picayune.