One type of money the colonies used was foreign coins. Some examples were Spanish pistoles and silver dollars. Most of these coins were imported from the Spanish colonies of Mexico and Peru.[3]<\/sup><\/a> Their\u00a0worth compared to British sterling fluctuated quite a bit throughout the colonies and over time. However, just like several other types of colonial currency (such as the individual paper currency of each colony) they remained less valuable than British sterling.[4]<\/sup><\/a> Unfortunately,\u00a0the age-old problem endured. There were not enough precious metals to go around. This was due to the philosophy of mercantilism\u2014the belief that a country should accumulate and hold as much money (precious metal) as possible.[5]<\/sup><\/a> As\u00a0a result of this philosophy, precious metals were not as readily available in colonies belonging to any country.[6]<\/sup><\/a><\/p>\n Another way colonists traded with each other was commodity goods. These were items such as tobacco or various animal skins that could be used within the colonies as currency.[7]<\/sup><\/a> Due\u00a0to the unwieldy nature of commodity goods, the colonies devised another form of exchange: paper currency uniquely created by each colony.<\/p>\n The first paper currency printed in the colonies was in December 1690. The Massachusetts Bay Colony needed to pay for military expenses from King William\u2019s War but did not have the money to do so. Finding this to be successful, Massachusetts created legislation that would be the start of paper currency in that colony.[8]<\/sup><\/a> Other\u00a0colonies followed suit throughout the eighteenth century, with Virginia being one of the last and most reluctant to do so in 1755.[9]<\/sup><\/a>\u00a0The\u00a0primary reason Virginia started printing money is because of the economic demands of the French and Indian War.[10]<\/sup><\/a> This type of exchange became prominent in all economies of the British colonies, although this locally printed paper currency was still considered less valuable than British sterling. In 1748, Virginia\u2019s local currency had an exchange rate with British sterling of 10 to 1.[11]<\/a><\/sup>\u00a0Here, you can see an image of a Virginian 5 pound James River Bank currency note issued in 1773.[12]<\/sup><\/a><\/p>\n As the paper currency of the colonies became more widespread, it started showing up in store ledgers. The Colchester store in Virginia belonging to John Glassford and managed by Alexander Henderson was one such store where paper currency became very prominent. Merchandise was sold to customers in both Virginia currency and British sterling; customers\u00a0paid for their merchandise with both forms of money, as well as commodity goods like tobacco. Below, a folio from the Colchester ledger (1760-1761) shows a client paying for all his purchases from November 1760 to March 1761 in Virginia paper currency.[13]<\/a><\/sup> British sterling was not included in any of his transactions. While there are many purchases in the ledger that were made in British sterling, it is obvious from this image that local currency was important to trade.<\/p>\n Printed currency was an important form of payment in the British colonies. It kept trade thriving without the need of coins and allowed colonies to pay their debts and stay afloat. Of course, the\u00a0colonies\u2019 ability to create new money whenever needed was dangerous as it led to inflation, especially\u00a0in times of war.[14]<\/sup><\/a> However,\u00a0the benefits outweighed the risks as the colonies found a way to overcome the deficit of precious metals in North America. Paper currency became vital to the survival of America until the British colonies became the United States.<\/p>\n <\/p>\n <\/p>\n [1]<\/sup><\/a> Louis Jordan, \u201cThe Value of Money in Colonial America,\u201d Colonial Currency,<\/em> last edited February 1, 1998, [2]<\/sup><\/a> Jordan, \u201cValue of Money in Colonial America.\u201d<\/p>\n [3]<\/sup><\/a> Ibid.<\/p>\n [4]<\/sup><\/a> Ron Michener, \u201cMoney in the American Colonies,\u201d EH.net Encyclopedia,<\/em> last modified January 13, 2011, accessed March 23, 2017, https:\/\/eh.net\/encyclopedia\/money-in-the-american-colonies\/.<\/p>\n [5]<\/sup><\/a> Encyclopedia Britannica Online,<\/em> \u201cMercantilism,\u201d accessed April 18, 2017, https:\/\/www.britannica.com\/topic\/mercantilism.<\/p>\n [6]<\/sup><\/a> Encyclopedia Britannica Online,<\/em> \u201cMercantilism.\u201d<\/p>\n [7]<\/sup><\/a> Jordan, \u201cValue of Money in Colonial America.\u201d<\/p>\n [8]<\/sup><\/a> Louis Jordan, \u201cThe First Printed Currency \u2013 1690,\u201d Colonial Currency,<\/em> last edited February 1, 1998, accessed March 23, 2017, https:\/\/coins.nd.edu\/ColCurrency\/CurrencyIntros\/IntroEarliest.html.<\/p>\n [9]<\/sup><\/a> Thomas E. Davidson, \u201cColonial Paper Money,\u201d American Revolution Museum at Yorktown Galleries,<\/em> accessed April 20, 2017, https:\/\/www.historyisfun.org\/exhibitions\/collections-and-exhibitions\/yorktown-victory-center- [10]<\/sup><\/a> Omohundro Institute of Early American History and Culture, \u201cPaper Money in Colonial Virginia,\u201d The William and Mary Quarterly<\/em> 20, no. 4 (April 1912): 228.<\/p>\n [11]<\/sup><\/a> Omohundro Institute, \u201cPaper Money in Colonial Virginia,\u201d 252.<\/p>\n [12]<\/sup><\/a> Davidson, \u201cColonial Paper Money.\u201d<\/p>\n![\"\"](\"https:\/\/projects.cah.ucf.edu\/wp-content\/uploads\/sites\/11\/2018\/03\/Doran-Robyn_currency.jpg\")
<\/a>![\"\"](\"https:\/\/projects.cah.ucf.edu\/wp-content\/uploads\/sites\/11\/2018\/03\/Folio-043C-edited-1024x362.jpg\")
\naccessed March 21, 2017, https:\/\/coins.nd.edu\/ColCurrency\/CurrencyIntros\/IntroValue.html.<\/p>\n
\ngalleries\/colonial-paper-money\/.<\/p>\n