Author Topic: Denomination systems  (Read 31256 times)

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Offline FosseWay

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Re: Denomination systems
« Reply #15 on: March 22, 2012, 01:44:43 PM »
In many countries it seems that the division between base metal small change and larger-value silver coins tended to be set at around the 20-25 cent mark (where 'cent' = generic subunit). A 20-cent coin would obviously be smaller than a 25-cent one if each had the same purity of silver. I wonder whether the tendency to use 25 cents is therefore as a result of starting from 1 principal unit and working downwards to halves and quarters to the smallest practical silver coin, whereas 20 cents is the result of starting at 1 subunit and working upwards, where 20 follows on logically from 2 (I realise the Netherlands is an exception). This applies to the LMU countries, where 20c coins tended to be rather shortlived until or unless converted into a base-metal form. It doesn't work so well with the US/Canada or the Scandinavian countries, where the 10c was also of silver, but perhaps it was advisable to have a bigger difference in value and therefore size between two precious-metal small coins. At the purely 1-2-5 end of the scale we find many newer currencies that took shape since the abandonment of silver in most circulation coinage, including decimal sterling, the post-1960 French franc and the euro.

Offline villa66

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Re: Denomination systems
« Reply #16 on: March 22, 2012, 03:34:01 PM »
In many countries it seems that the division between base metal small change and larger-value silver coins tended to be set at around the 20-25 cent mark...

I hope you'll think some more on this and talk to us about it. Really. I wonder about this stuff myself.

@ Christian: About Figleaf's assertions regarding America's "Spanish + French Revolutionary coin system." A little later, I hope.

 ;D v.

translateltd

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Re: Denomination systems
« Reply #17 on: March 22, 2012, 08:19:34 PM »
I suspect a lot of discussion about what is "logical" depends on habit - I'm reasonably good at maths but found it terribly confusing trying to deal with change in 25c and 2½-guilder pieces in a visit to Holland in pre-Euro days.

There is an analogy with road rules - NZ has (till this weekend) one simple rule that determines who gives way at an intersection, but it isn't used anywhere else in the world, so we are discarding it in favour of a more complicated sequence that I can't get my head around at all.  Apparently it's more "logical", but only to those who are familiar with it!




Offline villa66

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Re: Denomination systems
« Reply #18 on: March 25, 2012, 04:46:10 AM »
Don't want to play those "I think you're wrong but I won't say why" games once again, so ...

This isn't a case of that. I've let the person addressed know my objections to his version of U.S. coinage history several times, but the business about the U.S. adopting the “Spanish [coinage] system” down to the quarter-dollar value, “and the French [coinage] system below” is something that keeps getting repeated around here.

Jefferson and other Americans were voicing a preference for a decimal currency very early on. What contributed to their opinions is open to argument, of course, but there is plenty of reason to believe that their basic interest in things decimal was home-grown.
 
That the Spanish dollar (or at least the Spanish dollar as it was then circulating in the U.S.) was adopted as the American currency unit, or the fact that Spanish and Mexican silver circulated in parts of the U.S. until the legal tender status of foreign coinage was removed in 1857,  is not nearly the same thing (as is often asserted on this forum, most recently just upthread) as the U.S. adopting the “Spanish [coinage] system.” Instead, a slightly underweight Spanish dollar was adopted as the new American dollar, underpinned by a thoroughly un-Spanish system of decimal subunits (and for that matter, overtopped by an un-Spanish decimal “super-unit”).

I see nothing intrinsically Spanish in the cutting of coins into halves and quarters—or should I say “half pennies” and “farthings?” Spanish, sure—when you talk about some of the language use, or when you get below the quarters into individual “bits,” at eight to the 8-reales—but that’s the point, isn’t it? I mean, the U.S. did not adopt a system of 8 subunits. The U.S. did not adopt—as asserted upthread—the “Spanish [coinage] system.” It adopted a home-grown decimal coinage system, with a unit based on the Spanish dollar as was then circulating in the United States.

As for the choice of the half-dollar and quarter-dollar, and for much of their early use in the U.S., what we’re talking about is not nearly so much “Spanish” as it is “shortage.” Halving and quartering coins is like halving and quartering anything round—it’s the easiest and most natural division, the practical and human way of cutting things. Halve and quarter, and then halve the quarters. Aha! “Bits.” The American language usage descends from the process as it was applied to Spanish and Mexican “dollars,” but the process itself has roots far deeper. Was the halving and quartering adopted as part of the “Spanish [coinage] system,” or because halving and quartering makes practical sense across the whole range of cutting apart round things, and intuitive good sense beyond?

Anyone who knows anything about Thomas Jefferson knows the answer to that. Jefferson didn’t adopt the half-dollar and the quarter-dollar into his proposal for a coinage system because he wanted to render some sort of homage to the “Spanish system.” No way. He did it because it made practical sense within his own idea of things. (And ditto—maybe double ditto—for Alexander Hamilton later on.)

Jefferson recommended a simple decimal currency system (simpler than Morris’ 1782 decimal system by far) into the Legislature in 1784, and it was a suggestion that immediately gained Washington’s support. In mid-1785, the “Grand Committee” recommended (according to the Redbook) “...a dollar of silver with fractional coins of the same metal (in denominations of half, quarter, 10th, and 20th parts of a dollar); and copper pieces valued at 1/100 and 1/200 of a dollar.”

Which brings us, once more, to the assertion upthread about the French Revolution completing America’s “Spanish [coinage] system.”

The Redbook:“Congress gave formal approval to the basic dollar unit and decimal coinage ratio in its resolution of August 8, 1786.”  (Nussbaum, in 1957’s A History of the Dollar, says that the “resolution of August, 1786, dubbed the hundredth part of a dollar a ‘cent’—a Jeffersonian term.”)

The Redbook:“The Massachusetts cents and half cents struck in 1787 and 1788 were the first official coins in the United States to bear stated values in terms of decimal parts of the dollar unit.”

Of course these are all preliminaries to The Mint Act of  (April) 1792, which initiated the current American coinage system. And from what I read, October 1793 is when France adopted its own decimal coinage—on paper, anyway—so why do I keep reading here on the forum of the decimal coinage of Revolutionary France completing the American coinage system? If there was indeed a transfer, don’t the dates involved make it more likely that it was the other way around?

Finally, as for the additional assertion upthread re the 1875 introduction of the American 20-cent piece, and its being “an experiment to shift the border” between the Spanish and the French systems....good one.

 :) v.

Offline Figleaf

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Re: Denomination systems
« Reply #19 on: March 25, 2012, 08:12:50 PM »
Congratulations, Christian. Didn't think you'd get this far, so I'll react, though I have had it with this person's droning vicious personal attacks and I'll continue to ignore him.

Of course, the issue is not who "invented" what. Classical monetary systems already have quarters (e.g. the quadrans) and halves (e.g. the semis) of a standard unit (e.g. the as) as well as multiples of ten and one hundred (e.g. the denarius and the centenionalis.) The medieval obol of half a denarius is scarce, but a denarius would often have a cross for cutting it in two or four pieces. the Russian rouble had 100 kopeks long before Jefferson. All interesting and beside the point.

Part of the point is the pragmatic resolution of Medina del Campo of 1497. It created a system based on the copper maravedi, 34 being a silver real and 375 of which being a gold excellente. While the resolution was meant as a local regulation to forge local Spanish coin systems into one, it became the basis for an international coin standard that dominated the financial world for centuries. The silver coins in this global standard had denominations of 0.5, 1, 2, 4 and 8 reales. During the US war of independence, this was still the dominating global standard, although the English shilling (using a Carolingian system, also used in pre-decimal France and in the Republic) was making inroads. The coins of Spain dominated world finance. An emigrant, sailing from Delftshaven or Portsmouth to New Netherlands would have paid the captain in Spanish silver.

The other part of the point is the franc de germinal, as the name indicates, an invention of the French revolution. Contemporary US mythology belittles the French contribution to the US war of independence (e.g. at the battle of Yorktown, the largest army was French, commanded by Rochambeau), because the US fell out with the French revolution owing to the terreur, as Thomas Paine - himself a victim of the terreur - found out to his grief. However, the achievements of the French revolution deeply influenced the US society in all kinds of fields, from its legal system to its architecture. One of those achievements was the wide acceptance of decimal weight, measures and standards. Decimal systems were incidental before the revolution. They became the dominating standard after the revolution.

By the end of the wars of Napoléon, the franc de germinal (later the gold franc), a decimal coin, was the new global standard, although the pound was making inroads in British colonies. Its influence spread to all parts of the world through the Latin Monetary Union. Its power was broken only by the first world war, but gold francs remained in use as an international unit of account until the second world war. An American, sending a letter to the UK would pay a tariff, based on the UPU agreement, using gold francs.

So here we have two dominating world level currencies. One is characterized by a 1-2-4 organisation and originates in Spain, the other by a 1-10-100 organisation and it originates in France. Call them whatever you want, but "Spanish" and "French" seems fair to me and calling both "Roman" would be highly misleading, even when the Romans did use them.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

translateltd

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Re: Denomination systems
« Reply #20 on: March 25, 2012, 09:14:45 PM »
I think the only "red herring" in this tale is the influence of France, which just doesn't fit chronologically, as has been pointed out.  Distilling the story down, the US system appears to have been a fusion of its own decimal system (1-10-100) and the inherited (and, as noted, coexisting till 1857) usage of Spanish dollars and their fractions (1 - 1/2 - 1/4 - 1/8).  As I understand it, France was the third country to "go decimal" in its coinage system, after Russia and the US.


Offline Figleaf

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Re: Denomination systems
« Reply #21 on: March 25, 2012, 09:48:41 PM »
Huh? French influence in the Americas dates from well before the franc de germinal, also coin-wise. As I tried to explain, it's not about "inventions" but about number schemes and a naming convention that I can't see as strange, given where those schemes originated. Surely, you don't want to say that the US was the driving force for the wide acceptance of decimalisation? It is still counting in miles.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

translateltd

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Re: Denomination systems
« Reply #22 on: March 25, 2012, 11:26:04 PM »
Huh? French influence in the Americas dates from well before the franc de germinal, also coin-wise. As I tried to explain, it's not about "inventions" but about number schemes and a naming convention that I can't see as strange, given where those schemes originated. Surely, you don't want to say that the US was the driving force for the wide acceptance of decimalisation? It is still counting in miles.


Whoa!  You're moving the goalposts way beyond the original focus of the discussion here.  We're talking about the US adoption of decimal currency and the influence of the Spanish dollar in the American use of "quarters" and "two bits", nothing else.  As has been pointed out, French decimal currency came *after* the American adoption, so can hardly have influenced it.  General questions of French influence in the Americas, world-wide acceptance of decimalisation and the use of miles are entirely different issues.


Offline Figleaf

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Re: Denomination systems
« Reply #23 on: March 26, 2012, 01:37:07 AM »
No, I am not. I am saying the US denomination system consists of two parts, one rooted in the Spanish denomination system, another rooted in the franc de germinal system. I could have called it the Russian system, but that would have been confusing. I could have called it the denarius and centenionalis system, but that was no system. I could have called it the inverted pretzel system and confused everyone. I called it the French system because it seemed obvious.

Decimalisation was not invented one day, it was a long process, it is not restricted to coins but applies mainly to other stuff and it certainly did not originate in the US but got there because of international relations. I do not deny that the US coins came out before the French coins, I am saying that the order is irrelevant, because I am talking about a denomination system, not a coin. Decimalisation did not originate in France, but the French revolution popularized it into a worldwide standard, so I do not see why it should not be called the French system.

I hope I have been clear this time, but if not, since this is getting repetitive, let's do any follow-up by PM.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

translateltd

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Re: Denomination systems
« Reply #24 on: March 26, 2012, 05:14:00 AM »
It's clear that we're talking past each other again, so let's let it drop.

Offline villa66

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Re: Denomination systems
« Reply #25 on: March 26, 2012, 05:36:34 PM »
...But speaking of the French, we could also talk about 20-c and competing 1/4-franc of the 19th century. Looks like they may have had alternating theories of utility, or simply different practical requirements.

The American dollar of 1792 and its subunits as they existed in coin about 1796:
1---1/2---1/4---1/10---1/20---1/100---1/200.

The French franc germinal of 1803 and its subunits as they existed in coin about 1804:
1---1/2---1/4---1/10---1/20---1/100.

The French were free to choose in 1803 when they put together the franc germinal and its subdivisions. Any idea why they chose the “half-franc,” and “quarter-franc?” (This first iteration of their “quarter” lasted some four decades.)

 ??? v.

Offline chrisild

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Re: Denomination systems
« Reply #26 on: March 26, 2012, 08:07:46 PM »
Surely, you don't want to say that the US was the driving force for the wide acceptance of decimalisation? It is still counting in miles.

The US has certainly not gone metric, and it is amazing how Americans can deal with this 1-100 concept which must be terribly difficult for people who otherwise calculate with a yard being three feet and a foot being twelve inches. But I digress. ;D As others have pointed out, its currency became decimal quite a few years before a similar setup was introduced in France. We could be a little mean and rotten and say that the US copied the Russian decimal system, but Russia did not have a "purely" decimal setup.

The "decimal franc" was introduced in 1795; the coins came later. And I don't think it was a concidence that the French franc used the same 1-10-100 system that had been introduced in the US a few years before: 1 dollar or franc = 10 dimes or décimes = 100 cents or centimes.

And villa66, while I agree that the US currency was based on a decimal(-only) setup, and that literally cutting a "Spanish dollar" into four or eight pieces may have practical reasons (cash shortage, etc.), I don't really see a contradiction here as far as the reasons for introducing quarters (and not 20c pieces) are concerned. And to some extent the 8-based system did get stuck. ;) From the Wikipedia article about the Spanish dollar that I already quoted from: "The pricing of equities on U.S. stock exchanges in 1/8-dollar denominations persisted until the New York Stock Exchange converted first to pricing in sixteenths of a dollar on June 24, 1997, and shortly after that, to decimal pricing."

Christian

Offline villa66

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Re: Denomination systems
« Reply #27 on: March 28, 2012, 11:37:24 PM »
..."The pricing of equities on U.S. stock exchanges in 1/8-dollar denominations persisted until the New York Stock Exchange converted first to pricing in sixteenths of a dollar on June 24, 1997, and shortly after that, to decimal pricing."

Interesting and fun observation about the 1/8 unit and the NYSE. Here’s another of those anachronisms, this one from Nussbaum’s book: “And New Hampshire, whose 1784 constitution provided for the establishment of the shilling as the monetary unit, did not do away with this constitutional provision until 1948, by a popular referendum vote of: yes, 61,949; no, 28,038!”

The mish-mash of money in the 13 original colonies—much of it British or British-inspired, of course—made currency reconciliation a major concern for anyone putting together the new Federal coinage. Morris’s 1000-unit/1-mark---500-unit/1-quint---100-unit/1-bit decimal system, with each “unit” being the equivalent of 1/1440th of a Spanish milled dollar, suggests the difficulties in reconciling these criss-crossing and competing systems.  As above, New Hampshire established its shilling in 1784. And why not a shilling, except that it was a reminder of the British? After all, the earliest homegrown American coins—struck for decades—were the New England shillings, and their halves (6d), and quarters (3d).

So do the American half-dollar and quarter-dollar exist because the 1792 adoption of the Spanish milled dollar as the new currency unit mandated coins valued at the equivalent of 4-reales  and 2-reales?

Or were the American half-dollar and quarter-dollar adopted as subunits not only for reasons of the “Spanish system,” but perhaps also for broader reasons?

I think the latter. And I think that any discussion (popularly, anyway) of the origins of the half-dollar and quarter-dollar is now often cut short by the fun(!) linguistic fossils left behind by the long American acquaintance with Spanish and Mexican 8-reales coins, and their fractions, which circulated as de facto American coins from 1792 until 1859.

The main thing here though, for me anyway, is that we stop spreading the idea that the American coinage system wasn't thought through by its founders, and instead was just some kind of anachronistic cut-and-paste job.

 :) v.