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 1830 - 1859 |
 1880 -
1899 |
© 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. 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 |
|
| 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 |
|
| 1852-1872 | New French banks support economic development |
|
The Crédit Mobilier, founded in 1852, is the first effective major
French bank to be established specifically for providing funds for industry and
infrastructure. It is followed by many other new banks in the next two decades.
Despite the failure of the Crédit Mobilier in 1867 these banks channel
savings into essential investments in transport, communications, agriculture
and industry.
p 559 |
|
| 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 |
|
| 1860 | Crédit Agricole founded |
|
Its primary function is the supply of credit for French agriculture. The
Crédit Agricole develops into one of the world's largest banks. (During
the early 1980s it was the largest, and in 1991 the sixth largest).
p 560 |
|
| 1860 | The Russian State Bank established |
|
Two public banks had been established by Catherine the Great in 1768 to finance
her wars with the Ottoman Empire (Turkey), but in 1860 a proper state bank with
wider functions is belatedly established.
p 553 |
|
| 1861-1865 | The US Civil War |
|
The Confederacy finances its war effort mainly by printing money. In addition
to the Confederate notes, the States, railway, insurance and other companies
also issue notes. The resulting hyperinflation renders Confederate paper
worthless. By comparison inflation in the North is relatively moderate as the
Union government raises very substantial sums of money by taxation and
borrowing.
p 485-488 |
|
| 1861 | US Congress suspends convertibility of notes into specie |
|
Priority in the use of gold and silver is given to government purposes as a
result of the war.
p 486 |
|
| 1861 | Post Office Savings Bank founded in Britain |
|
The widespread geographic coverage of the post offices and their long opening
hours makes them very convenient as savings bank branches. The government too
gains since the savings are under the control of the Treasury and come to
provide Gladstone's government with large funds at a low rate of interest.
p 336-337 |
|
| 1862 | US Legal Tender Act and the issue of Greenbacks |
|
The United States Treasury starts issuing notes that are not convertible into
silver or gold but are legal tender for all purposes except payment of customs
duties and interest on government securities.
p 488-489 |
|
| 1862 | Tax placed on US state bank notes |
|
The rate is set at 2%.
p 489 |
|
| 1864 | US National Bank Act |
|
This amends and expands the provisions of the Currency Act of the previous
year. Any group of five or more persons are allowed to set up a bank, subject
to certain minimum capital requirements. As these banks are authorized by the
Federal, not the State governments, they are known as national banks. To
secure the privilege of note issue they have to buy government bonds and
deposit them with the Comptroller of the Currency.
p 489 |
|
| 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 |
|
| 1865 | French law on cheques simplified |
|
French businesses have tended to prefer notes to bank deposits and cheques. The
law is simplified to encourage greater use of cheques.
p 557 |
|
| 1865 | Hong Kong and Shanghai Bank founded |
|
Ever since it has been the main bank of issue in Hong Kong. In the 1980s it was
still responsible for about 80% of the colony's note circulation (the other 20%
being supplied by the Chartered Bank) and by 1990 the Hong Kong Banking Group
is the 13th largest in the world.
p 626-627 |
|
| 1865 | US Contraction Act |
|
By the end of the Civil War the Greenbacks are only worth half as much
in gold as their nominal value. Under the terms of this act the government
begins to withdraw them from circulation.
p 494 |
|
| 1866 | Tax on US state bank notes is raised to 10% |
|
The state bank notes are taxed out of existence and replaced by the national
bank notes which are of uniform design, apart from the name of the
particular bank. Despite the demise of their notes the tax does not lead to the
disappearance of the state banks.
p 489 |
|
| 1867 | International Monetary Conference in Paris |
|
An attempt is made to widen the area of common currencies based on French gold
and silver 10 and 5 franc coins. The US, being on a bimetallic standard, sends
representatives.
p 493 |
|
| 1867 | Singapore makes dollars from Hong Kong, Mexico, Bolivia and Peru legal tender |
|
In the British colonies of Malaya and Singapore the official currency is the
Indian rupee but the general public keep their accounts and make most of their
payments, including taxes, in dollars and cents. Therefore in 1867 the public's
preferences are recognised when legal tender status is given to various foreign
coins.
p 625 |
|
| 1868 | US halts withdrawal of the Greenbacks |
|
Their withdrawal was exacerbating a depression in the economy. In the following
years some increases in Greenback circulation are made.
p 494 |
|
| 1868 | Meiji restoration in Japan |
|
Japan's isolationist policy is ended. As a result the few pre-Meiji banking
organisations set up by the Zaibatsu family groups prove completely inadequate
to meet the needs of liberalized trade.
p 581-582 |
|
| 1870-1893 | Plentiful silver supplies cause fall in value of Indian and other Asian currencies |
|
After 1870 there is a vast increase in the amount of silver coming on to world
markets because of new mines and the demonetization of silver as Germany,
Scandinavia and other countries switch to the gold standard. As a result the
undebased silver coinage of India, and the currencies of China, Japan and south
east Asia, countries comprising half the world's population, suffer an
unprecedented fall in value.
p 622 |
|
| 1870-1872 | Huge increase in the number of German joint-stock banks |
|
No fewer than 107 are founded in this period.
p 569 |
|
| 1870-1871 | Franco - Prussian War |
|
The victorious Germans force France to pay a huge indemnity of 5 billion
francs. The money is raised easily by a loan which is more than 10 times
oversubscribed. This experience partly explains French reliance on borrowing in
preference to taxation in the First World War and French insistence on German
reparations afterwards.
p 561 |
|
| 1871 | Germany becomes a united country |
|
The German states unite and adopt the Mark as their common currency and base it
on the gold standard.
p 356,567-568 |
|
| 1871 | Japanese Currency Act |
|
A national mint is established at Osaka and the decimal system of yen and sen
is introduced.
p 582 |
|
| 1872 | Japanese National Bank Act |
|
American rules serve as a model for Japanese commercial banks.
p 582 |
|
| 1872 | Paris Clearing House created |
|
This is over 100 years after the creation of the London Bankers' Clearing
House. The backwardness of French banking prior to the second half of the 19th
century has retarded the country's economic development.
p 559 |
|
| 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 |
|
| 1873-1886 | The Great Depression in Britain |
|
The British economy is in decline relative to those of the US and Germany. One
effect of the so-called depression is to cause doubts about the merits of the
gold standard.
p 353,493 |
|
| 1873 | Dai-Ichi Bank founded in Japan |
|
The Dai-Ichi Bank is set up by the government with the support of some of the
larger Zaibatsu banks. It is the first bank to be created under the terms of
the 1872 Act.
p 582 |
|
| 1873 | US Coinage Act |
|
The silver dollar ceases to be the standard of value. Thus the US is virtually
on the gold standard, in practice if not in law.
p 494 |
|
| 1873 | Bank panic in the US and Germany |
|
Lacking a central bank or lender of last resort able and willing to supply
sufficient liquidity to quell crises in their early stages the US proves prone
to bank panics. As in 1857 the panic spreads across the Atlantic and causes
many bank failures in Germany.
p 498-499 |
|
| 1874 | Singapore makes the Japanese yen and US dollar legal tender |
|
This is in addition to the other foreign coins granted legal tender status in
1867.
p 626 |
|
| 1875 | Bank of Prussia becomes the German Reichsbank |
|
On becoming the national bank of the whole of Germany it absorbs and replaces
the note issues of about 30 other state banks with its own notes.
p 443,567-568 |
|
| 1875 | Scottish Institute of Bankers founded |
|
This is the world's first bankers' institute. In the last couple of decades of
the 19th century many trained young bankers from Britain, especially from
Scotland, take up positions in overseas banks.
p 360 |
|
| 1875 | Greenback Party formed in the US |
|
It aims to at least secure and preferably increase Greenback
circulation.
p 494 |
|
| 1875 | US Resumption Act |
|
This is intended to restore the convertibility of banknotes into gold. Full
redemption is promised by 1 January 1879.
p 494 |
|
| 1876 | Canadian Indian Act bans the potlatch |
|
The potlatch, a ritualized form of barter involving competitive gift exchange
that is widely used by various Indian tribes, is banned by the Canadian
government.
p 11 |
|
| 1876 | Japanese Bank Act revised |
|
The regulations are altered to make them more appropriate for Japanese
conditions. This leads to a surge in the formation of new banks.
p 582 |
|
| 1876 | Mistsui Bank founded in Japan |
|
The new bank is based on the exchange bureau run by the Mitsui family as part
of their Zaibatsu (family-based) trading empire.
p 583 |
|
| 1878 | Greenback Party returns 14 members to Congress |
|
A compromise between the Party and its opponents fixes the Greenback
circulation at its existing level, halting the previous trend to scarcer,
dearer money.
p 494 |
|
| 1878 | US Bland-Allison Act |
|
The silver lobby pushes through this act forcing the US Treasury to buy between
$2 million and $4 million of silver each month for coinage and fixes the
relative prices the mint pays for gold and silver.
p 495 |
|
| 1878 | France abandons bimetallism and in practice adopts the gold standard |
|
By the end of the 1870s the gold standard has become an international standard
with London as the world's main financial centre.
p 356 |
|
| 1879 | Institute of Bankers (England and Wales) founded |
|
This is 4 years after its Scottish counterpart. Soon there is a brain-drain of
young bankers from Britain to other parts of the world.
p 360 |
|
| 1879 | Limping bimetallism in the Latin Monetary Union |
|
Vast increases in the world's supplies of first silver and later gold unsettle
the Latin Union's bimetallic policies and only gold coins are universally
accepted throughout the Union.
p 493 |
|
| 1879 | Number of Japanese banks reaches 153 |
|
The growth in numbers is a result of the 1876 Act.
p 582 |
|
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1830 - 1859 |
1880 -
1899 |