© 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).
1850-1914 | Huge amounts of capital are exported from Britain |
---|---|
Huge amounts of British capital are invested abroad, especially after 1890, in
the United States, parts of the British Empire, and Argentina. The total
reaches billions of pounds. Britain's later economic problems may be partly due
to the neglect of British industry by the banks during this period.
p 348-352 |
|
1860-1921 | Number of banks in the US increases by over 19 times |
During the same period bank numbers fall in other advanced countries but in the
US a peak of nearly 30,000 is reached in 1921.
p 490-491 |
|
1865-1926 | The Latin Monetary Union |
This comprises France, Italy, Belgium, Switzerland, and later Greece. The gold
and silver coins of each country are legal tender throughout the union. The
union has faded away by the 1920s before its formal ending.
p 443,492-493,557 |
|
1873-1924 | The Scandinavian Monetary Union |
Denmark, Sweden and Norway form a monetary union similar to the Latin one but
with gold as the standard for their currency.
p 356,443 |
|
1891-1901 | Number of Japanese savings banks increases twentyfold |
By 1901 the total is 441. Up from a score ten years earlier.
p 583 |
|
1900 | US Gold Standard or Currency Act |
The great increase in America's stock of gold leads to abandonment of
bimetallism. The act also halves the minimum capital requirement for the
smallest national banks, thus stimulating an increase in their numbers, and
raises the limitations on the issue of notes.
p 497 |
|
1900 | Bank of France has representation in 411 towns, including 120 full branches |
Owing to its very extensive network of branches and offices, commercial banks
have not developed as vigorously as their British and German counterparts.
p 556-557 |
|
1900 | Industrial Bank of Japan founded |
Its purpose is to provide long-term loans and debentures to assist the mining
and metallurgical industries in particular.
p 584 |
|
1901 | Number of Japanese banks reaches a peak of 1,867 |
Thereafter amalgamation and mergers reduce the number.
p 583 |
|
1902 | Straits Settlement (Singapore) dollar introduced |
This is intended as a replacement for the foreign coins which are demonetized
two years later.
p 626 |
|
1903 | French coins and notes are still far more important than bank deposits |
Bank deposits form only a tenth of the French money supply whereas coins
account for half. Bank note circulation is 8 times as high as the Bank of
England's issues and the Bank of France's gold reserves are even higher than
its note issues.
p 557-558 |
|
1904 | Foreign coins lose legal tender status in Singapore |
The demonetization of Mexican and other foreign dollars simplifies cash
transactions.
p 626 |
|
1906 | Switzerland and Japan establish postal giro systems |
They are the first countries to follow the example of Austria which established
the world's first postal giro system in 1883.
p 584 |
|
1907 | International bank crisis starts in New York |
Unlike earlier US panics which tended to start in weak country banks, this one
starts in the trust companies in New York. They are not members of the clearing
system that might have been able to prevent the crisis snowballing. Hundreds of
American banks fail. In contrast Britain weathers the storm with ease and this
motivates proposals for a system of central banks in the US.
p 361,498-502 |
|
1908 | US Aldrich-Vreeland Act |
As a response to the panic of the previous year this allows groups of a minimum
of 10 national banks to form National Currency Associations to issue temporary
currency. The act also sets up a National Monetary Commission which authorizes
42 separate reports, most of which contain studies of foreign banking systems.
p 501 |
|
1909-1911 | Lloyd George anticipates the British welfare state |
As chancellor of the exchequer Lloyd George introduces a revolutionary series
of budgets. In order to finance welfare benefits the taxation system is made
much more progressive, efficient and buoyant - just in time to finance the
First World War. Warfare engulfs welfare.
p 367 |
|
c. 1910 | Horses still used as money by the Kirghiz in the Russian Empire |
The Kirghiz people in central Asia have long used horses as their main monetary
unit and store of value. Sheep are used as subsidiary units and small change is
given in lambskins.
p 42 |
|
1911 | US Postal Savings system established |
Because of opposition from the commercial banks the postal savings system does
not develop in a substantial way.
p 501 |
|
1911 | Issues of silver coins in British west Africa exceed those in Britain |
The annual amount of silver issued increases from an average of £24,426
in the 5 years up to 1890 to £847,850 which exceeds the amount currently
being issued for use in the United Kingdom.
p 601 |
|
1912 | West African Currency Board (WACB) established |
The WACB is set up to be responsible for the issue of currency in the British
colonies of Nigeria, the Gold Coast (Ghana), Gambia, Togoland and the British
Cameroons. The main form of currency produced is silver coins. Gold coins
quickly vanish from circulation to be used as ornaments while bank notes are
used mainly by traders and government agents.
p 602-603 |
|
1912 | China ceases minting its traditional cash coins |
After a couple of millennia use of these traditional Chinese base metal coins
comes to an end.
p 56 |
|
1913 | Chamberlain Report on Indian Currency and Finance |
The report includes a memorandum from one of its members, J.M. Keynes, arguing
that there is no need for the internal circulation of gold in India. He also
points out that India's strong habits of acting as a sink of the precious
metals pose deflationary dangers not only to India itself but also to
Europe.
p 623 |
|
1913 | Pujo Committee Report on the powers of the US money trust |
The committee, established the previous year, reports that power over money and
credit is concentrated in just a few hands. It signals an end to laissez-faire
in US banking.
p 501 |
|
1913 | US Federal Reserve System established |
Instead of a single central bank, like the First and Second Bank of the United
States, 12 Federal Reserve districts are established each with its own reserve
bank. All national banks have to become members of the system and the state
banks are given conditional permission to join. Banks are also allowed to
establish branches abroad.
p 501-502,524 |
|
1913 | Number of German savings banks reaches 3,133 |
Their total assets are more than double those of the commercial banks.
p 570 |
|
1913 | Number of industrial credit co-operatives in Germany reaches 1,500 |
By this time they have well over 800,000 individual members and outstanding
credits of over 1.5 billion marks.
p 570 |
|
1914 | Number of rural credit co-operatives in Germany reaches 17,000 |
Their growth has mushroomed since the first one was set up by Friedrich Wilhelm
Raiffeisen in 1846.
p 570 |
|
1914 | German Reichsbank has over 100 main branches |
In addition it has 4,000 sub-offices. Thus the Reichsbank's regional
representation is far stronger than that of the Bank of England in Britain.
p 571 |
|
1914-1918 | First World War |
Despite the huge revenues raised from taxation the British national debt rises
tenfold. The government fails to use its bargaining power, as the only really
massive borrower in wartime, to get money at low rates of interest.
p 367-373 The French national debt rises from 28 billion to 151 billion francs and the note issue increases over 6-fold.p 562 Germany relies more on borrowing, particularly short-term, and less on taxation than Britain. Consequently its policy is more inflationary.p 572 Japan's industry is greatly stimulated by the war. By 1918 Japan has passed from being a debtor to a creditor country.p 584 |
|
1914 | New British notes issued and gold is withdrawn from circulation |
New one pound and 10 shilling notes are issued by the Treasury, not the Bank of
England, and postal orders and Scottish and Irish banknotes are made legal
tender. The success of the new notes allows banks to withdraw gold gradually
from internal circulation, thus putting a quiet end to the gold standard.
p 369-370 |
|
1917 | The world's first billion pound loan is raised |
Within 6 weeks of the issue of the third War Loan by the British government the
money is raised.
p 372 |
|
1917 | US enters 1st World War |
As a result the national debt increases from about $1 billion in 1916 to $25
billion in 1920.
p 504 |
|
1918 | French Giro established |
As France makes relatively small use of cheque payments at the time of the
giro's foundation, this system of money transfer fulfils unmet needs and grows
rapidly. By the time Britain's giro is established 50 years later the French
one is the largest in the world.
p 561 |
|
1919 | US Edge Act to promote foreign banking indirectly permits bank branches |
This amendment to the Federal Reserve Act allows the chartering of corporations
for the purpose of engaging in international or foreign banking. Despite the
legal prohibition of branch banking these corporations can be set up anywhere,
including other states in the US.
p 524,538 |
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