On 01/18/2014 01:33 PM, Richard Esplin wrote: > This was how money worked in the United states until the end of the 19th > century. No clear market winner emerged. It was a mess.
I assume you were referring to the situation where banks issued bank notes and many banks crashed in the early 1840s, including the Kirtland Saftey Society. We might want to distinguish between currency (the US dollar) and the bank notes. The bank notes weren't currency. My understanding is that they were promisary notes that the bank would pay real USD to someone who wanted to cash them in. Banks issued far more bank notes than they had assets to cover, and when people demanded their money, the banks collapsed. It's true the bank notes were used as money, but my understanding is they weren't currencies. They were all USD for one. Also their value didn't fluctuate as a commodity compared to the USD, though I'm sure in communities where bank notes were used that prices of goods went up and down depending on the perception of a particular bank's position and whether or not they'd make good on their promises. /* PLUG: http://plug.org, #utah on irc.freenode.net Unsubscribe: http://plug.org/mailman/options/plug Don't fear the penguin. */
