A Comparative Chronology of Money

Monetary History from Ancient Times to the Present Day

1800 - 1829

© 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).

c. 1780-1810 Rapid spread of country banking in England and Wales
By 1810 the total number of licensed and unlicensed banks is probably over 800. In most cases their founders have strong ties with particular industries or trades and the banks meet the need of small workshops, mines etc. for working capital. Without these banks the Industrial Revolution would have been strangled in its infancy.

p 286-291

1787-1817 Privately-issued tokens become common in Britain
By the end of the 18th century there is a severe shortage of copper and silver coins in Britain so that many firms have difficulty in obtaining enough currency to pay wages. This leads to a growth in payments in kind, use of foreign coins, and unofficial tokens. The token manufactures greatly expand the amount of currency available.

p 292-296

1792-1815 French Revolutionary and Napoleonic Wars
The pressures of war cause many changes in the financial systems of both France and Britain.

p 297-298,556

1793-1801 Britain sends more than £15 million to its allies
This is to support them in the war against France.

p 297

c. 1800-1860 Five hundred fold depreciation of the cowrie in Uganda
When cowrie shells are first introduced to Uganda at the end of the eighteenth century two are sufficient to purchase a woman. Thereafter the wholesale importation of cowries causes inflation with the result that by 1860 one thousand cowries are needed for such a purchase.

p 35,640

1800 The Bank of France is founded
France gains a national bank over a century after England, Holland and Sweden.

p 556

1800 Number of banks in the US reaches 29
Their number has increased from just 4 in 1790, despite fears that the Bank of the United States would enjoy monopoly powers preventing the rise of new banks.

p 473

1802 Barings buys 2,220 shares in the Bank of the United States
The number of British shareholders grows in the years leading up to the date when the bank's charter is due for renewal.

p 473

1803 The Louisiana Purchase doubles the size of the United States
Napoleon, being short of cash, offers to sell Louisiana to the United States for 15 million dollars. Two British banks, Barings and Hopes, agree to lend the money to the US government and, despite the wars, transfer it to Napoleon.

p 346

1804 Full-weight Spanish coins are re-issued by the Bank of England
Matthew Boulton is employed to erase completely the existing design on full-weight Spanish coins and stamp them as Bank of England Five Shilling Dollars.

p 294

1804 Bank of England issues token silver coins
These are light-weight, as opposed to full-bodied coins, for 3s. and for 1s. 6d.

p 294

1806 President Jefferson suspends the minting of silver coins
This is because of the tendency of these new coins to disappear from circulation, as an unintended consequence of the US 1792 Coinage Act.

p 468

1806 Bank of Bengal founded
For hundreds of years before the creation of the first formal, western-style banks, financial services have been provided in India by castes such as the Multanis, Marwari and Pathans who provide credit, collect deposits and arrange trading deals through bills of exchange or hundi. The Bank of Bengal is the first of the so-called presidential banks to be established during British rule to supplement the internal money supply of India.

p 620-622

1809-1831 Ohio State government issues paper warrants as currency
Warrants for 5, 10 and 20 dollars are used as currency in Ohio because of the shortage of coins.

p 468

1810 Royal Mint equipped with steam-powered machinery
Matthew Boulton who was responsible for constructing the Mint's new manufactory died a year before its completion. Boulton had previously supplied steam-powered machinery to mints in Russia, Spain, Denmark, Mexico and India.

p 294

1810 Start of the savings bank movement in Britain
Although there had been earlier examples of savings banks in Britain and on the continent, the Rothwell Savings Bank established by Henry Duncan as a bank for the poor becomes widely imitated not only in Britain but also France and Holland.

p 332-333

1810 Bullion Report by the House of Commons Select Committee
The Report from the Select Committee of the House of Commons on the High Price of Bullion blames the inflation taking place during the Napoleonic Wars on the creation of an excessive amount of credit, principally by the Bank of England and recommends that the Bank's notes be made fully convertible after two years, whether or not the war is over.

p 223,299-303

1811 Parliament rejects the proposal to restore convertibility of notes
The government argues successfully that to restore convertibility would imperil the British war effort.

p 302

1811 Bank of the United States' charter is not renewed
Public opposition to British shareholders, suspicion that the bank is exceeding its constitutional powers, and opposition from those who believe that banking should be controlled by the states not the Federal government, are responsible for the demise of the bank.

p 473-474

1812-1814 War between the United States and Britain
Inflation takes off in the United States. This is only partly because of the war. Without the restraining hand of the Bank of the United States there is a huge increase in the number of banks issuing notes with very little specie backing. This experience swings opinion in favour of creating a new national bank.

p 474

1816-1818 Prussia abolishes all internal customs
Other German states, with varying speeds, follow its example prior to the formation of a full customs union (Zollverein) between nearly all of them in 1834.

p 567

1816 Second Bank of the United States founded
The bank begins the task of restoring the convertibility of paper notes. It also restrains other banks from making excessive issues of notes.

p 474-476

1816 Privy Council recommends establishment of the gold standard
This proposal is accepted and, in accordance with a related proposal, a new British one pound coin made of gold, the sovereign, is produced.

p 303

1817 Act to suppress tokens passed by the British Parliament
An earlier bill in 1812 was unsuccessful. The 1817 Act does make certain exemptions, e.g. tokens issued by Poor Law unions are allowed until 1821 by which time the supply of official coinage has increased sufficiently to make tokens redundant.

p 296

1817-1852 Bank of France discount rate remains almost unchanged
During this time it is fixed at 4% except during the revolutionary troubles of 1848.

p 558

1818-1819 Various US states levy taxes on the branches of the Second Bank
The Second Bank of the United States refuses to pay these taxes and wins its case in the Supreme Court.

p 476-477

1820 Last British silver pennies are minted
This is nearly 1,100 years after the first English silver pennies, though silver continues to be used for higher value coins for another 100 years.

p 207

1821 Restoration of convertibility of Bank of England notes
This is two years earlier than the target date set by the 1819 Act for the Resumption of Cash Payments and completes the establishment of the gold standard in practice as well as in law.

p 303

1822 The Société Général founded in Belgium
The bank plays a vigorous role in Belgium's industrial revolution, the first of any country on the European mainland.

p 558

1824 Parliament rejects decimalization of British currency
Further proposals made in 1853, 1857 and 1918 are also rejected before the Halsbury Report of 1963 is accepted and put into effect in 1971.

p 442

1824 Illinois declares all branches of the Second Bank illegal
This decision is overturned by the US Supreme Court.

p 477

1824 Clearing system developed by Boston banks
The Suffolk Bank of Boston, in co-operation with 6 other local banks, begins the development of a system of clearing inter-bank accounts.

p 476

1825-1826 Banking crisis in England
During the year 60 banks fail. To alleviate the liquidity shortage caused by the financial panic the Bank of England issues one pound notes and the Royal Mint steps up the production of sovereigns.

p 306

1826 Banking reforms introduced in England and Wales
The bank crisis is blamed on small, weak country banks issuing too many small denomination notes. Parliament bans the issue of notes of less than £5 in England and Wales but not, after protests, in Scotland. Parliament also allows the creation of new joint-stock banks outside a 65 mile radius of central London and also permits the Bank of England to set up regional branches.

p 307-308

1826 Sir Walter Scott defends small Scottish banknotes
Under the pseudonym of Malchai Malagrowther, the novelist Sir Walter Scott writes a series of letters for the Edinburgh Weekly Journal demonstrating the superiority of the Scottish banking system and the disastrous consequences that would follow the abolition of small denomination notes. Because of the protests by Scott and others parliament decides that the ban on such notes should apply in Scotland.

p 308

1826 Death of the last British Exchequer Chamberlain
Upon his death the Treasury Tallies are abolished in accordance with the Act of 1783. Later the redundant tallies are returned to the House of Commons, an action that has disastrous consequences in 1834.

p 663

1828 Andrew Jackson elected President of the USA
Jackson has been suspicious of banks ever since he read the history of the South Sea Bubble.

p 476

1829 New York State passes Safety Fund Act
This tightens up conditions for chartering banks and contains provisions foreshadowing later developments in deposit insurance.

p 476

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Roy Davies - Last updated 25 May 2005.