kick off 3/24 1.why does our money look the way it does? (shape, designs, etc.) 2.if you could...
TRANSCRIPT
![Page 1: Kick off 3/24 1.Why does our money look the way it does? (shape, designs, etc.) 2.If you could design a new dollar bill, what would it look like?](https://reader036.vdocument.in/reader036/viewer/2022083009/5697bfa91a28abf838c99e21/html5/thumbnails/1.jpg)
Kick off 3/24
1.Why does our money look the way it does? (shape, designs, etc.)
2.If you could design a new dollar bill, what would it look like?
![Page 2: Kick off 3/24 1.Why does our money look the way it does? (shape, designs, etc.) 2.If you could design a new dollar bill, what would it look like?](https://reader036.vdocument.in/reader036/viewer/2022083009/5697bfa91a28abf838c99e21/html5/thumbnails/2.jpg)
Monetary Standards
![Page 3: Kick off 3/24 1.Why does our money look the way it does? (shape, designs, etc.) 2.If you could design a new dollar bill, what would it look like?](https://reader036.vdocument.in/reader036/viewer/2022083009/5697bfa91a28abf838c99e21/html5/thumbnails/3.jpg)
I. Monetary Standards Defined
• The mechanism for keeping the money supply – Portable– Divisible– Durable– In limited supply
![Page 4: Kick off 3/24 1.Why does our money look the way it does? (shape, designs, etc.) 2.If you could design a new dollar bill, what would it look like?](https://reader036.vdocument.in/reader036/viewer/2022083009/5697bfa91a28abf838c99e21/html5/thumbnails/4.jpg)
II. Pre Civil War Monetary StandardsA. The Federal Government
1. Could produce only coin (commodity money)2. Not ___________ to produce paper money
B. State Banks 1. Produced their own paper currency backed by gold or silver2. Wildcat banks – banks that overproduced currency3. Problems (even with honest banks)• Too many currencies (colors, sizes, etc.)• Temptation to __________• ___________________• Trade over long distance
![Page 5: Kick off 3/24 1.Why does our money look the way it does? (shape, designs, etc.) 2.If you could design a new dollar bill, what would it look like?](https://reader036.vdocument.in/reader036/viewer/2022083009/5697bfa91a28abf838c99e21/html5/thumbnails/5.jpg)
III. The Civil War and Monetary Standards
• Need for money to fight the ___________forced Federal Government (and Confederate Government) to print currency for the first time since the Revolution
A. _____________________(because they were green)1. No gold or silver backing2. Legal tender – must be accepted to pay debts
B. National Banking System1. People feared Greenbacks would lose value and stopped using
them2. Nationally chartered banks issued currency backed by
___________________________ • Government got money to pay for the war• Currency was __________________
3. Tax on state currency forced private currencies out of production
![Page 6: Kick off 3/24 1.Why does our money look the way it does? (shape, designs, etc.) 2.If you could design a new dollar bill, what would it look like?](https://reader036.vdocument.in/reader036/viewer/2022083009/5697bfa91a28abf838c99e21/html5/thumbnails/6.jpg)
III. The Civil War and Monetary Standards
C. Other Currencies1. Gold certificates – paper currency backed by gold
in the __________________2. Silver Certificates – paper currency backed by
silver in the treasury and silver dollar coins
![Page 7: Kick off 3/24 1.Why does our money look the way it does? (shape, designs, etc.) 2.If you could design a new dollar bill, what would it look like?](https://reader036.vdocument.in/reader036/viewer/2022083009/5697bfa91a28abf838c99e21/html5/thumbnails/7.jpg)
IV. The Gold StandardA. The Gold Standard Act (1900)
1. Put the US on __________standard – currency represents equal amount of gold in the treasury
2. Greenbacks and NB notes were still used
B. Advantages of a gold standard1. ___________________________________2. ___________________________________
C. Disadvantages of a gold standard1. Gold supply must match ___________________2. Mass redemption if government is not honest3. Gold price ________________________
D. Abandoning the gold standard1. Mass redemption during the ______________________2. Law requiring disclosure of possession of _________of gold 3. Gold Reserve Act 1934
• Gold _________________from citizens• Currency off the gold standard
![Page 8: Kick off 3/24 1.Why does our money look the way it does? (shape, designs, etc.) 2.If you could design a new dollar bill, what would it look like?](https://reader036.vdocument.in/reader036/viewer/2022083009/5697bfa91a28abf838c99e21/html5/thumbnails/8.jpg)
V. The Inconvertible Fiat Standard• Fiat money that is not backed by ____________A. Managed Money Supply
1. Quantity of money in circulation is controlled by the _______________________________
2. Currency consists of coins and Federal Reserve Notes
B. Success of currency depends on:1. Portability – bills are easy to carry around2. Durability – bills and coins can withstand use3. Divisibility – any value can be made4. Limit supply • Amount is controlled by _________________policies• _______________________ are prosecuted