The history of the dollar is very surprising. Today, we use without hesitation the word dollar, but also its usual periphrasis “the green bill”, or its symbol $. However, do you know why the dollar has this name, where does its green color come from and why is it symbolized by the symbol $?
In which country invented the dollar?
The sweet and wonderful story of the dollar has its roots in a charming Bohemian valley, one of the historical regions of the Czech Republic.
THE STORY OF THE DOLLAR BEGINS IN THE MIDDLE OF EUROPE
In 1520, a silver vein was discovered in this territory. Owner of the site digs mines to exploit this vein, and opens a factory for the production of 25g silver coins. These silver coins are very popular, and the currency is logically called the joachimsthaler. Made in very pure silver, this coin quickly exceeded the original limits of the Kingdom of Bohemia and becomes the reference currency for the entire Holy Roman Empire. By expanding its broadcast territory, the name of the coin had been changed from joachimsthaler to the simpler thaler.
Does the consonance already make you think of something? During the 16th century, all of Europe became fond of thalers, whose format has become a standard! Thus, a thaler represented a silver coin that weighed between 25 and 30 g. This piece was a huge success, as it circulated across Europe in one form or another for 400 years! It ended up being replaced in the 19th century (in Germany by the mark and in Austria by the florin to name just two Germanic currencies).
DOLLAR SYMBOL HISTORY
To understand the origin of the dollar symbol, let`s remember Spanish dollar. The “heads” part of the coin features the portrait of the current ruler of Spain. If the heads therefore varies over the centuries, the tails is irremovable and stands the test of time! There are two columns on this reverse which represent the Pillars of Hercules. In ancient Roman times, the Pillars of Hercules symbolized the rocks that separate the Strait of Gibraltar. And yes, in a way, the history of the dollar dates back to ancient times! On the coin around these two columns are wrapped bands on which are inscribed the word “plus” on one, and “ultra” on the another. It meant the success of Spain which had made that leap into the unknown what were the voyages beyond the Strait of Gibraltar, in the Atlantic, far from the reassuring Mediterranean Sea.
If these Pillars of Hercules sound familiar to you, it’s because they are still today one of the symbols of Spain, appearing in particular on the country’s flag. To show the power of Spain, there are two planispheres between the two columns on the coin, the one represents Europe, the other represents the New World.
This part of the Spanish dollar had a huge influence on whoever used it, especially on Americans. When they needed a symbol to represent their currency, traders used the left column with its S-shaped band all around. This is where the super-star dollar symbol $ comes from! Note also that the Pillars of Hercules haven`t influence only the United States. Indeed, in Mexico, where the Spanish dollar was of course used, the current symbol to represent the peso is precisely the same ‘S’ strikethrough used in the United States.
Two other hypotheses dispute the authorship of the $ symbol with the columns of Hercules. The Spanish dollar was very quickly called a peso in the Spanish colonies. The symbol would come from the plural abbreviation of the peso in a PS, whose two letters ended up being jumbled.
The other hypothesis is a little more patriotic. The symbol would come from the United States abbreviation. U and S would have mingled until the U loses one of its bars.
THE ORIGIN OF THE GREEN COLOR OF THE DOLLAR
Once the American currency is officially created, remains however an important part of the history of the dollar to explain: its green color! Indeed, paper money is a very practical way for a state to regulate the circulation of money in the country. Basically, the idea was that a paper banknote could be exchanged at any time for its gold or silver value at federal banks. This system still works fine today, especially in the United States, because it needs stability to function.
On the other hand, during periods of crisis, when the state was in dire need of liquidity, this convertibility was temporarily interrupted, and huge quantities of banknotes were then put into circulation. During one of these crises, the Civil War, the monetary authorities were not the only ones printing banknotes. It is estimated that after the war, a third of the banknotes in circulation were counterfeit! To resolve this situation, it was then decided that the banknotes would be printed with the green color. Indeed, the green color was particularly difficult to produce, people didn`t mix yet yellow and blue to get it, it took a whole series of chemical processes to get green. One of these processes to fix the color for example, was the use of cyanide. The use of this poison have also given extremely negative connotations to the green color.
28TH JANUARY 2021