Gold standard

goldgold exchange standardbacked by goldgold alonegold monetary standardgold-backedmetallic conversionGold Specie StandardGold Standard Act 1925gold-backed currency
A gold standard is a monetary system in which the standard economic unit of account is based on a fixed quantity of gold.wikipedia
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Fixed exchange rate system

fixed exchange ratepeggedfixed
Lastly, countries may implement a gold exchange standard, where the government guarantees a fixed exchange rate, not to a specified amount of gold, but rather to the currency of another country that uses a gold standard.
A fixed exchange rate, sometimes called a pegged exchange rate, is a type of exchange rate regime in which a currency's value is fixed or pegged by a monetary authority against the value of another currency, a basket of other currencies, or another measure of value, such as gold.

Gold

Aunative goldgold dust
A gold standard is a monetary system in which the standard economic unit of account is based on a fixed quantity of gold.
In the past, a gold standard was often implemented as a monetary policy, but gold coins ceased to be minted as a circulating currency in the 1930s, and the world gold standard was abandoned for a fiat currency system after 1971.

Gold reserve

gold reservesofficial gold reservesgold
Most nations abandoned the gold standard as the basis of their monetary systems at some point in the 20th century, although many still hold substantial gold reserves.
A gold reserve was the gold held by a national central bank, intended mainly as a guarantee to redeem promises to pay depositors, note holders (e.g. paper money), or trading peers, during the eras of the gold standard, and also as a store of value, or to support the value of the national currency.

Silver standard

silversilver currencyprice of silver
In its place, European territories chose silver as their currency over gold, leading to the development of silver standards.
In 1704, following Queen Anne's proclamation, the British West Indies became one of the first regions to adopt a gold standard in conjunction with the Spanish gold doubloon coin.

Money

monetaryspeciecash
Various commodities have been used as money; typically, the one that loses the least value over time becomes the accepted form.
The gold standard, a monetary system where the medium of exchange are paper notes that are convertible into pre-set, fixed quantities of gold, replaced the use of gold coins as currency in the 17th–19th centuries in Europe.

German gold mark

marksGoldmarkMark
The United States used the eagle as its unit, Germany introduced the new gold mark, while Canada adopted a dual system based on both the American gold eagle and the British gold sovereign.
Goldmark is the term by which the gold standard-based currency of the German Empire from 1873 to 1914 is ususally referred to.

Monetary system

monetary standardcurrency systemsmonetary
A gold standard is a monetary system in which the standard economic unit of account is based on a fixed quantity of gold.
(This is known as the gold standard.) The silver standard was widespread after the fall of the Byzantine Empire, and lasted until 1935, when it was abandoned by China and Hong Kong.

Peel's Bill

1819 Act for the Resumption of Cash PaymentsResumption of Cash Payments, etc. Act 1819
The 1819 Act for the Resumption of Cash Payments set 1823 as the date for resumption of convertibility, which was reached by 1821.
49), marked the return of the British currency to the gold standard, after the Bank Restriction Act 1797 saw paper money replacing convertibility to gold and silver under the financial pressures of the French Revolutionary Wars.

Fiat money

fiat currencyfiatfiat currencies
It was a fiat money (not convertible on demand at a fixed rate into specie).
Commodity money is created from a good, often a precious metal such as gold or silver, which has uses other than as a medium of exchange (such a good is called a commodity).

Bimetallism

bimetallicbimetalismbimetallic standard
This began a long series of attempts by the United States to create a bi-metallic standard.
In the 19th century, there was a great deal of scholarly debate and political controversy regarding the use of bimetallism in place of a gold or silver standard (monometallism).

Coinage Act of 1873

Fourth Coinage ActCrime of '73Mint Act of 1873
The coinage act of 1873 (also known as the Crime of ‘73) demonetized silver.
In abolishing the right of holders of silver bullion to have their metal struck into fully legal tender dollar coins, it ended bimetallism in the United States, placing the nation firmly on the gold standard.

William Jennings Bryan

BryanWilliam J. Bryanpolitician
During the latter part of the nineteenth century the use of silver and a return to the bimetallic standard were recurrent political issues, raised especially by William Jennings Bryan, the People's Party and the Free Silver movement.
At the 1896 Democratic National Convention, Bryan delivered his "Cross of Gold speech" which attacked the gold standard and the eastern moneyed interests and crusaded for inflationary policies built around the expanded coinage of silver coins.

Free silver

free coinage of silverFree Silver movementunlimited coinage of silver
During the latter part of the nineteenth century the use of silver and a return to the bimetallic standard were recurrent political issues, raised especially by William Jennings Bryan, the People's Party and the Free Silver movement.
Its advocates were in favor of an expansionary monetary policy featuring the unlimited coinage of silver into money on demand, as opposed to strict adherence to the more carefully fixed money supply implicit in the gold standard.

People's Party (United States)

PopulistPopulist PartyPeople's Party
During the latter part of the nineteenth century the use of silver and a return to the bimetallic standard were recurrent political issues, raised especially by William Jennings Bryan, the People's Party and the Free Silver movement.
In order to fund that war, the U.S. government had left the gold standard by issuing fiat paper currency known as Greenbacks.

Bank of England

The Bank of EnglandBankAsset Purchase Facility
With the end of the Napoleonic Wars, the Bank of England began the massive recoinage programme that created standard gold sovereigns, circulating crowns, half-crowns and eventually copper farthings in 1821. In 1833 however, Bank of England notes were made legal tender and redemption by other banks was discouraged.
Britain remained on the gold standard until 1931, when the gold and foreign exchange reserves were transferred to the Treasury; however, they continued to be managed by the Bank.

Isaac Newton

NewtonSir Isaac NewtonNewtonian
In 1717, Sir Isaac Newton, the master of the Royal Mint, established a new mint ratio between silver and gold that had the effect of driving silver out of circulation and putting Britain on a gold standard.
This inadvertently resulted in a silver shortage as silver coins were used to pay for imports, while exports were paid for in gold, effectively moving Britain from the silver standard to its first gold standard.

Hyperinflation in the Weimar Republic

hyperinflationinflation in the Weimar Republic1920s German inflation
During the Occupation of the Ruhr the German central bank (Reichsbank) issued enormous sums of non-convertible marks to support workers who were on strike against the French occupation and to buy foreign currency for reparations; this led to the German hyperinflation of the early 1920s and the decimation of the German middle class.
To pay for the large costs of the ongoing First World War, Germany suspended the gold standard (the convertibility of its currency to gold) when the war broke out.

Great Depression

DepressionThe Great DepressionDepression era
In any case, prices had not reached equilibrium by the time of the Great Depression, which served to kill off the system completely.
One reason why the Federal Reserve did not act to limit the decline of the money supply was the gold standard.

Austro-Hungarian gulden

guldenflorinflorins
When adopting the gold standard, many European nations changed the name of their currency, for instance from Daler (Sweden and Denmark) or Gulden (Austria-Hungary) to Crown, since the former names were traditionally associated with silver coins and the latter with gold coins.
The Gulden or forint (Gulden, forint, forinta/florin, zlatý) was the currency of the lands of the House of Habsburg between 1754 and 1892 (known as the Austrian Empire from 1804 to 1867 and the Austro-Hungarian Monarchy after 1867), when it was replaced by the krone/korona as part of the introduction of the gold standard.

Alexander Hamilton

HamiltonHamiltonianA. Hamilton
In the 1780s, Thomas Jefferson, Robert Morris and Alexander Hamilton recommended to Congress the value of a decimal system.
Despite his own preference for a monometallic gold standard, he ultimately issued a bimetallic currency at a fixed 15:1 ratio of silver to gold.

Pound sterling

£GBPpounds
In 1898, British India pegged the silver rupee to the pound sterling at a fixed rate of 1s 4d, while in 1906, the Straits Settlements adopted a gold exchange standard against sterling, fixing the silver Straits dollar at 2s 4d.
As a consequence of these flows of silver out and gold in, Great Britain was effectively on a gold standard.

Sovereign (British coin)

sovereignsovereignsgold sovereign
A formal gold specie standard was first established in 1821, when Britain adopted it following the introduction of the gold sovereign by the new Royal Mint at Tower Hill in 1816.
In 1925, the Chancellor, Winston Churchill, secured the passage of the Gold Standard Act 1925, restoring Britain to that standard, but with gold to be kept in reserve rather than as a means of circulation.

1926 United Kingdom general strike

General Strike1926 General StrikeGeneral Strike of 1926
By fixing the price at the pre-war rate of $4.86, Churchill is argued to have made an error that led to depression, unemployment and the 1926 general strike.

Legal tender

demonetizeddemonetizationdemonetised
In 1833 however, Bank of England notes were made legal tender and redemption by other banks was discouraged.
In 1914, the Banking Amendment Act gave legal tender status to bank notes from any issuer and removed the requirement that banks authorised to issue bank notes must redeem them on demand for gold (the gold standard).

John Maynard Keynes

KeynesMaynard KeynesJ. M. Keynes
John Maynard Keynes, citing deflationary dangers, argued against resumption of the gold standard.
Keynes advised it was no longer a net benefit for countries such as Britain to participate in the gold standard, as it ran counter to the need for domestic policy autonomy.