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The Revolution’s paper money legacy
Source: Strike the Root
Author: George F. Smith
Posted on 07.18.08 by Mary Lou Seymour

“After Lexington and Concord, Congress had a war on their hands and needed a way to finance it. The Americans were in large measure tax rebels, so taxation of their own would have to wait. After giving some thought to borrowing, Congress decided instead to call upon their old friend, the printing press.The colonists had a long history with paper money. They had been inflating since the 1690s and had all but driven silver specie out of circulation. In 1751, Parliament banned further note issues in New England, and by 1764 extended the prohibition to the rest of the colonies. All colonies were required to gradually retire the notes still in circulation. What were the consequences? Following a brief period of price deflation, and in contrast to dire predictions caused by a lack of money, hard money New Englanders experienced price stability and prosperity.” (07/17/08)


Link: http://www.strike-the-root.com/82/smith/smith1.html

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