In the summer of 1775, the 13 colonies that would become the United States of America found themselves at war with England. Shots were heard round the world at Lexington, Massachusetts, and battles were also fought at Concord and Mount Fort. The Declaration of Independence was still a year away, but the Continental Congress understood if they were. they needed money in this war.
The Continental Congress decided on a simple plan to wage war against England: just print some money and hope the people would accept it. And so it came to pass that on the 23rd of June, 1875, the Continental Congress issued $2,000,000 worth of money. The printed laws were soon known as Continental, since they were ordered to be printed by the Continental Congress.
First, everything is fine with the new currency. The people were once told that the war in the Continental Congress would bring back money in taxes and withdraw, so as to preserve their stability. The pious colonists gladly accepted the money, and all seemed well.
Unfortunately, it was not clear. $2,000,000 didn’t seem like much to the Continental Congress, so they decided to print some more money. And some more. By the end of 1775 $6,000,000 worth of new continental currency had been printed.
However, despite this continuous flow of money into the colonies (it was estimated that there was only $12,000,000 worth of money in the colonies before the first printing of continental currency, which by the end of 1775 had already increased the money supply by 50%.) Things were going well.
The problem was then that the Continental Congress or the lovers between the colonists had not expected war. coach and regularly As time went on in Congress they were obliged to print more and more money, while the support of the Continental Congress and their currency grew less and less. On top of this, counterfeiters began to produce counterfeit bills, further endangering the stability of the currency.
By 1779 it was the result that $100 was the price of specie (gold and silver, etc. of the continental currency. Two years later in 1781 $100 worth of real money would get you $16,800 worth of continental paper money.At this time there was far more than $200,000,000 worth of continental money floating around.
The soldiers of the Continental Army, who had been paid in Continental currency and had continued to support the good cause, the inflation was destructive. After the defeat of these, so many people were found in bad debt, with almost no paper money (when they even got it).
Although the Continental dollar had been obtained to allow the Continental Congress to wage its final victorious war, the Continental Currency was seen by all as a failure. The common phrase “not worth the Continental” was inspired by the disaster, and it gave Americans for generations to come a strong interest in paper money, an interest held by many presidents in our history such as Thomas Jefferson and the famous Andrew Jackson, who believed that his crowning achievement was the defeat of the Second National Bank. In fact, Jackson had the words “Kill the Bank” engraved on his tombstone, contradicting the belief that both central banking and paper money were so keen on printing.
