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 1600 - 1699 |
 1750 - 1799 |
© Roy Davies & Glyn Davies, 1996 & 1999.
Based on the book: A History of Money from Ancient Times to the Present Day by Glyn Davies, rev. ed. Cardiff: University of Wales Press, 1996. 716p. ISBN 0 7083 1351 5. (Page numbers in the 3rd edition published in 2002 may be slightly different).
| 1699-1727 | Sir Isaac Newton is Master of the Mint |
|---|---|
|
During Newton's period in charge the emphasis of the mint's work changes from
coining silver to coining gold.
p 247 |
|
| 1700 | Collapse of the Darien Company ruins Scotland's trade hopes |
|
The Scottish company was intended to set up a colonial entrepot at Darien in
Panama. The impact of its failure on Scotland's attempts to develop its
overseas trade proves a powerful motivating factor in the Act of Union with
England in 1707.
p 274 |
|
| 1704 | Promissory Notes Act |
|
This confirms the legality in England of goldsmith's notes as
negotiable, i.e. payable to the bearer rather than to a named person.
p 251 |
|
| 1705 | John Law publishes Money and Trade Considered |
|
After travelling widely on the Continent, Law returns to his native Scotland
and publishes Money and Trade Considered: With a Proposal for Supplying the
Nation with Money. He argues that metallic money is unreliable in quality
and quantity. Bank notes issued and managed by a public bank would remove the
brakes on the economy. He is probably the world's first Keynesian; but compare
Sir William Petty, 1682.
p 553 |
|
| 1707 | Act of Union of England and Scotland |
|
Among the provisions of the act is a stipulation that the United Kingdom should
have a uniform coinage - a single currency symbolising and cementing a
united kingdom. During the 3 years of recoinage in Scotland the
shortfall in currency is made up by the issue of notes by the Bank of Scotland.
p 274-275 |
|
| 1708 | Britain sets American colonies' exchange rate for Spanish dollar |
|
The British parliament specifies that 6 shillings should be the maximum rate
any of the colonies should use for the Spanish peso or dollar which is widely
used as currency by the colonists. However the Act has little effect.
p 459-460 |
|
| 1713 | John Law returns to France |
|
His ideas were rejected in Britain but in France he gets the chance to put them
into effect.
p 553 |
|
| 1715 | Duke of Orleans becomes Regent of France |
|
French public finance is in a parlous state after the wars and extravagance of
Louis XIV. State promissory notes fall to a quarter of their nominal value
within a year. In desperation the Duke turns to John Law.
p 554 |
|
| 1715 | North Carolina makes 17 different forms of money legal tender |
|
All the British colonies in North America tend to suffer from a dearth of the
official British coinage. Consequently they use a variety of substitutes
including wampum, copied from the native inhabitants, tobacco and other natural
commodities, and Spanish and Portuguese coins. The importance of these
substitutes varies according to location.
p 38,457 |
|
| 1716 | John Law creates France's first public bank |
|
To economize on the use of precious metals Law establishes a note-issuing bank,
Law & Co. or the Banque Generale. In contrast to the state's short-term
paper Law's banknotes appreciate in value.
p 554 |
|
| 1718 | French Regent reorganizes Law's bank |
|
Law's bank becomes the Banque Royale and is given a new charter placing the
lucrative note-issuing business more directly under the control of the Regent.
p 554 |
|
| 1719-1720 | The Mississippi Bubble |
|
The Mississippi Company had been set up to exploit the wealth of French
colonies, especially in Louisiana. In 1719 it is also given a monopoly of trade
with the East Indies and China and a speculative boom in the value of its
shares ensues. The boom, combined with the over-issue of notes by the Banque
Royale, leads to a drain of precious metals from France to London. Law's
enemies persuade the Regent to dismiss him from his post as Minister of
Finance, the bank stops payment and the boom collapses. The debacle sets back
the development of banking in France by about 100 years.
p 264,268,278,554-555 |
|
| 1719-1720 | The South Sea Bubble |
|
Contemporary with the Mississippi Bubble a speculative boom takes place in the
shares of the South Sea Company, originally set up to break the Spanish
monopoly of trade with Central and South America, after it proposes to take
over the National Debt. Numerous other companies are set up to take advantage
of the speculative mania. The sudden collapse of the boom leads to changes in
company law which affect the future development of banking in both Britain and
America.
p 264-266 |
|
| 1722 | Unsuccessful attempt to alleviate Ireland's chronic shortage of low-value coins |
|
The lack of small money in Ireland has grown to such an extent that
manufacturers are obliged to pay their employees in cards signed upon the back,
to be exchanged afterwards for money. In August 1722 minting of copper
halfpence and farthings for Ireland begins by William Wood in Bristol but
ceases after protesters in Ireland demand that the country should have its own
mint. Consequently the Irish poor are left to suffer for many years from their
own promissory cards.
p 246-247 |
|
| 1722 | Royal Prussian Seehandlung founded |
|
The first German state bank is created for the purpose of stimulating foreign
trade.
p 566 |
|
| 1723 | First issue of notes by the Pennsylvania Land Bank |
|
These are secured by mortgages on the property of the bank owners.
p 461 |
|
| 1727 | The Royal Bank of Scotland is founded |
|
The Royal Bank introduces a "cash-credit" system allowing certain applicants
for loans to withdraw cash as required, interest being paid only on the amount
withdrawn. This is copied by other banks in Scotland and then in England and is
the origin of the overdraft.
p 275-276 |
|
| 1727 | Tobacco notes become legal tender in Virginia |
|
Certificates attesting to the quality and quantity of tobacco deposited in
public warehouses circulate more conveniently than the actual leaf, already
used as money for over a century, and these notes are made legal tender.
p 458 |
|
| 1729 | Benjamin Franklin's Modest Enquiry into the Nature and Necessity of a Paper Currency |
|
Following the publication of this work Franklin is awarded the contract for
printing the Pennsylvania Land Bank's third issue of notes.
p 461 |
|
| 1741 | British Parliament decides that the Boston Land Bank is illegal |
|
The Land Bank or Manufactory Scheme is ruled to contravene the Bubble Act of
1720 which is retrospectively extended to cover the colonies.
p 462 |
|
| 1749-1751 | Pelham reduces the burden of the British national debt |
|
Henry Pelham, the British prime minister, takes advantage of low market rates
of interest to reduce interest payments on the national debt from 4% to
3½% in 1749 and 3% in 1750, and replaces a whole series of annuities by
a single 3% consolidated stock or consols in 1751.
p 269-270 |
|
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