Gold and Silver Exchange
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Denver, Colorado 80246
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10, of April 1777
| Twelve Shillings. No
This Bill Shall pafs current for Twelve Shillings.
according to an Act of GENERAL ASSEMBLY of
The Common-Wealth of Pennfylvania, paffed the Twentieth
Day of March, in the Year One Thoufand Seven Hundred
and Seventy-feven Davted the Tenth
Day of April, A.D. 1777
piece of history in this Colonial Note from the Commonwealth of
Pennsylvania and dated April 10, 1777. The denomination is Twelve
Shillings. Signed by William Kenly and Benjamin Betterton. There
is a great admonition on the back "TO COUNTERFEIT IS DEATH!"
Neat colonial note from Pennsylvania!
Note from the Commonwealth of Pennsylvania and dated April 10, 1777.
The denomination is Twelve Shillings.
Front: Serial number: 2647- hand written in black ink (very clear)
Signed by William Kenly and Benjamin Betterton in black ink. The note
is printed in red and black ink.
Arms of the Commonwealth of Pennsylvania on the front with a ship,
plow and bundles of wheat surrounded with the motto "AGRI CULT.[URE]
COM (all in red)
Back: A farm scene in red as well as the admonition "TO COUNTERFEIT IS
Philadelphia Printed by John Dunlap 1777
Early American currency
Early American currency went through several stages of development in
the colonial and post-Revolutionary history of the United States.
Because few coins were minted in the thirteen colonies that became the
United States in 1776, foreign coins like the Spanish dollar were
widely circulated. Colonial governments sometimes issued paper money
to facilitate economic activity. The British Parliament passed
Currency Acts in 1751, 1764, and 1773 that regulated colonial paper
During the American Revolution, the colonies became independent
states; freed from British monetary regulations, they issued paper
money to pay for military expenses. The Continental Congress also
issued paper money during the Revolution, known as Continental
currency, to fund the war effort. Both state and Continental currency
depreciated rapidly, becoming practically worthless by the end of the
To address these and other problems, the United States Constitution,
ratified in 1788, denied individual states the right to coin and print
money. The First Bank of the United States, chartered in 1791, and the
Coinage Act of 1792, began the era of a national American currency.
There were three general types of money in the colonies of British
America: commodity money, specie (coins), and paper money.
Commodity money was used when cash (coins and paper money) was scarce.
Commodities such as tobacco, beaver skins, and wampum served as money
at various times and places.
As in Great Britain, cash in the colonies was denominated in pounds,
shillings, and pence. The value varied from colony to colony; a
Massachusetts pound, for example, was not equivalent to a Pennsylvania
pound. All colonial pounds were of less value than the British pound
sterling. The coins in circulation in the colonies were most often
of Spanish and Portuguese origin. The prevalence of the Spanish
dollar in the colonies led to the money of the United States being
denominated in dollars rather than pounds.
One by one, colonies began to issue their own paper money to serve as
a convenient medium of exchange. In 1690, the Province of
Massachusetts Bay created "the first authorized paper money issued by
any government in the Western World". This paper money was issued
to pay for a military expedition during King William's War. Other
colonies followed the example of Massachusetts Bay by issuing their
own paper currency in subsequent military conflicts.
The paper bills issued by the colonies were known as "bills of
credit". Bills of credit were usually fiat money; that is, they could
not be exchanged for a fixed amount of gold or silver coins upon
demand. Bills of credit were usually issued by colonial
governments to pay debts. The governments would then retire the
currency by accepting the bills for payment of taxes. When colonial
governments issued too many bills of credit, or failed to tax them out
of circulation, inflation resulted. This happened especially in New
England and the southern colonies, which unlike the middle colonies,
were frequently at war.
This depreciation of colonial currency was harmful to creditors in
Great Britain when colonists paid their debts with money that had lost
value. Adam Smith criticized colonial bills of credit in his famed
1776 work The Wealth of Nations. According to Smith, the inflationary
nature of the currency was a "violent injustice" to the creditor; "a
scheme of fraudulent debtors to cheat their creditors" (Book II,
Chapter II). As a result, the British Parliament passed several
Currency Acts to regulate the paper money issued by the colonies. The
Currency Act of 1751 restricted the emission of paper money in New
England. It allowed the existing bills to be used as legal tender for
public debts (i.e. paying taxes), but disallowed their use for private
debts (e.g. for paying merchants).
Another Currency Act in 1764 extended the restrictions to the colonies
south of New England. Unlike the earlier act, this act did not
prohibit the colonies in question from issuing paper money, but it did
forbid them to designate their currency as legal tender for public or
private debts. This prohibition created tension between the colonies
and the mother country, and has sometimes been seen as a contributing
factor in the coming of the American Revolution. After much lobbying,
Parliament amended the act in 1773, permitting the colonies to issue
paper currency as legal tender for public debts. Shortly
thereafter, some colonies once again began issuing paper money. When
the American Revolutionary War began in 1775, all of the rebel
colonies—soon to be independent states—issued paper money to pay for
After the American Revolutionary War began in 1775, the Continental
Congress began issuing paper money known as Continental currency, or
Continentals. Continental currency was denominated in dollars from 1/6
of a dollar to $80, including many odd denominations in between.
During the Revolution, Congress issued $241,552,780 in Continental
Continental currency depreciated badly during the war, giving rise to
the famous phrase "not worth a continental". A primary problem was
that monetary policy was not coordinated between Congress and the
states, which continued to issue bills of credit. "Some think that
the rebel bills depreciated because people lost confidence in them or
because they were not backed by tangible assets," writes financial
historian Robert E. Wright. "Not so. There were simply too many of
them." Congress and the states lacked the will or the means to
retire the bills from circulation through taxation or the sale of
Another problem was that the British successfully waged economic
warfare by counterfeiting Continentals on a large scale. Benjamin
Franklin later wrote:
The artists they employed performed so well that immense quantities of
these counterfeits which issued from the British government in New
York, were circulated among the inhabitants of all the states, before
the fraud was detected. This operated significantly in depreciating
the whole mass....
By the end of 1778, Continentals retained from 1/5 to 1/7 of their
face value. By 1780, the bills were worth 1/40th of face value.
Congress attempted to reform the currency by removing the old bills
from circulation and issuing new ones, without success. By May 1781,
Continentals had become so worthless that they ceased to circulate as
money. Franklin noted that the depreciation of the currency had, in
effect, acted as a tax to pay for the war. In the 1790s, after the
ratification of the United States Constitution, Continentals could be
exchanged for treasury bonds at 1% of face value.
After the collapse of Continental currency, Congress appointed Robert
Morris to be Superintendent of Finance of the United States. Morris
advocated the creation of the first financial institution chartered by
the United States, the Bank of North America, in 1782. The bank was
funded in part by specie loaned to the United States by France. Morris
helped finance the final stages of the war by issuing notes in his
name, backed by his own money. The Bank of North America also issued
notes convertible into specie.
The painful experience of the runaway inflation and collapse of the
Continental dollar prompted the delegates to the
Constitutional Convention to include the gold and silver clause into
the United States Constitution so that the individual states could not
issue bills of credit, or "make any Thing but gold and silver Coin a
Tender in Payment of Debts." This restriction of bills of credit
was extended to the Federal Government, as the power to "emit bills"
from the Articles of Confederation was abolished, leaving Congress
with the power "to borrow money on credit."
^ Newman, 350.
^ Flynn, "Credit in the Colonial American Economy".
^ a b c d e f Michener, "Money in the American Colonies".
^ a b Newman, 11.
^ a b Wright, 45.
^ Allen, 96–98.
^ Allen, 98.
^ Newman, 185–86.
^ Newman, 16.
^ Newman, 17.
^ Wright, 50.
^ Wright, 49.
^ Wright, 52
^ Kenneth Scot, Counterfeiting in Colonial America (Philadelphia:
University of Pennsylvania Press, 2000), 259–60.
^ Wright, 49; Newman, 17.
^ Newman, 17; 49.
^ Wright, 62.
^ U.S. Constitution, Article I, section 10.
^ U.S. Constitution, Article I, section 8.
^ Rozeff, p 18
Postage Currency 1861-1862