Paper moneys in Europe and the USA
Introduction in the circulation of paper moneys closely related at deficit metal for production of coins. The matter is that the availability of gold and silver is defined by rates of growth of only one branch - mining (which directly depends on natural resources) whereas the requirement for money depends on economy development as a whole. Therefore, when after industrial revolution the accelerated economic growth has begun, replacement of a metallic currency in circulation paper became not only possible, but also inevitable. Within XVIII century paper moneys were extended in all countries of Europe (in Russia - since 1769), by the end of XIX century they began to dominate all over the world.
In Europe notes have occurbed considerably later, than in China. The first paper moneys represented "coins" from a paper, (Netherlands) manufactured in Protestant Leiden during the Spanish siege in 1574. More than 5 thousand from presumably 14 thousand townsmen have died, basically for hunger. Stocks of a skin which applied as money in extreme cases have run out even: it have welded and used in food. Then to create currency, townspeople have taken covers and pages of receiving tanks of church hymns and messages and have made of them paper plates. Stamped recreated "money" by means of the same cliches which were used before for stamping of metal coins.
The Present notes were issued a bit later. There was it in Sweden .
In 1644 in the country there was in the circulation copper money, but they were too heavy and, furthermore, have fast depreciated because of Thirty-year war (1618-1648). Taking it into consideration, Johann Palmstruh (Johan Palmstruch), the Stockholm bank which has based in 1657 (Stockholms Banco), has offered new monetary unit - a time credit paper (Kreditivsedlar). It has printed the first notes in July, 1661.
Unfortunately, Palmstruh were comprehended by failure: soon the bank had problems of that denominations has been manufactured too much. Directors of bank have brought to court and have sentenced to imprisonment.
For today it was saved very few first notes of the Stockholm bank, and they represent the rare collection copies.
Formation an English monetary system was accompanied by long struggle between the king and dealers for the control right over it. Wilhelm's accession to the throne III Oransky in 1688 to which "Nice revolution" preceded, financed by dealers, has moved a bowl of scales in favour of long-awaited many independent credit institute.
The bank of England created in 1694 at the initiative of William Pattersona (William Patterson), has manufactured notes Goldsmithnotes as the joint note (promissory note) of English jewellers. Item "(I undertake to pay to the bearer of this on the first request the sum in pounds" formally meant that the bill can be interchanged for gold though in practice it was not always possible.
Having conceded the right to print the note, the state has obtained a loan. And the Bank of England became in due course one of the most influential financial institutions in the world.
In 1797 "the Restriction certificate" according to which the Bank of England was released of exchange of notes - bills for gold has been published, the forced rate of exchange of notes was positioned, and last have in essence turned to paper moneys. In 1820 exchange of notes on gold has been reduced, and notes have turned again to credit money.
In Norway which was in those days the Danish province, in 1695 businessman Tor Molen (Thor Mohlen) from government approval also has released paper moneys. On notes was available five wax seales. Unfortunately, inhabitants of the country have not seen in them advantage and, hardly having received denominations, have suffered them revertively in bank to interchange for a hard coin. That, by itself, has called financial squeezes mister Molena.
In Denmark paper moneys have arrived in the circulation only in 1713. There was it during war to Northern Ireland.
France has started to print paper moneys in 1703 during Louis XIV board. In 1776 the bank "Cash desk of the commercial account" to which the issuance of bank notes, the State expenditure intended for cover has been entrusted has been founded. Though these token moneys also were called as notes (in significance "bill"), in essence they were paper moneys. Currency issue widely practised France during an epoch of Great French revolution of 1789-1794: in 1789-1790 assignats (Fr. assignat), originally on 2,4 billion livres have been manufactured, and to 1795 their sum made 40 billion livres. In February, 1797 assignats have been cancelled, and France has returned to metal monetary circulation. In XIX century the country was twice reverted to fiduciary system: in connection with February revolution of 1848 and ex-Prussian war 1870-1871. In ex-Prussian war the government of France has expanded issuance of bank notes for war financing, declared about irredeemable notes and has attached them a forced rate of exchange. Notes from bills have turned to paper moneys.
In to the North America paper moneys have been manufactured earlier, than in the European countries, even in existence of North American colonies of England (Pennsylvania, Southern and Northern Carolina, etc.).
In the beginning of 1690th years the Massachusetsky colony (nowadays - the State of Massachusetts, the USA) the first of colonies has manufactured notes for the constant circulation.
During struggle of English colonies for independence the Congress of states in 1775 has accepted the decree on issue of "continental money" for 3 million dollars. To 1779 their sum has exceeded 240 million dollars. Rates of depreciation of "continental money" advanced rates of their issue. The rate of paper moneys fast fell, 1 silver dollar in 1780 equaled to 50-60 paper dollars. "Continental money" has been liquidated on March, 18th, 1780 by devaluation with delay of an exchange of 6 years and use of five-interest bearing bonds. The government of the USA has carried out again currency issue during a civil war of 1861-1865, having printed signs on green colour - "greenbacks". In total it has been manufactured paper moneys for the sum of 450 million dollars; they have depreciated in 2,5 times. With the end of war superfluous weight of money have withdrawn from circulation, and stability of dollar has been reduced by revalorization.
Definitive transferring to paper moneys in the USA has been forced in many respects by the Presidential Decree 6102 signed on April, 5th, 1933 by Franklin Roosevelt. The document provided punishment in the form of the fine of 10 thousand dollars or 10 years of prison to any who will keep at itself more than 100 dollars gold, instead of notes.