For over 200 years,
the official currency of the United States of America
has been the almighty dollar. But how did it come to
be our legal tender? And why does the dollar
bill look the way it does? Well today we're going to
take a look at the history of the dollar bill. But before we get started,
be sure to subscribe to the Weird History channel. After that, leave
a comment and let us know what other
financial topics you would like to hear about. OK, time to show me the money. When the earliest settlers
of the 13 American colonies arrived in the New World,
they brought along gold and various British coins. But like everyone else who's
ever carried cash on a trip, they quickly ran out of money. This left them with no means to
buy food or other necessities from nearby indigenous
tribes or even each other. Obviously, this was bad. In the absence of cash
and coin, the settlers started to trade with
commodity money, which included things like tobacco,
beaver skins, or certain kinds of shells called wampum. In fact, wampum was so important
that in 1637, the Massachusetts Bay Colony declared
them to be legal tender. But commodity trading
has its limits. For example, the value
of a crop like tobacco can wildly fluctuate depending
on the success of the harvest, and over time, it dries
up and loses its value. Imagine going to pay for
lunch and finding out the money in your
wallet has expired like an old banana or crypto. The settlers didn't have
too many other options. The British government
wouldn't allow the export of gold
and silver coins and also refused to let the
colonists mint their own. However, Spanish coins were
much easier to come by. As a result, most of
the coins in circulation during the colonial era were of
Spanish or Portuguese origin. In fact, for the vast majority
of the 17th and 18th centuries, the Spanish peso, also
known as the Spanish dollar, was one of the few widely
accepted currencies. The earliest paper
currency in America was issued by the Massachusetts
Bay Colony in 1690 for the purpose of funding
a military expedition during King William's War. Other colonies
followed suit and began printing their own
currency in connection with other military conflicts. Basically, little IOUs giving
you the exciting opportunity to invest in violent
national disagreements. This early colonial
money was denominated in pounds, shillings,
and pence, but the value of those denominations could
vary from colony to colony. So a pound in Massachusetts
might be worth less than a pound in Pennsylvania. Obviously, this
created some confusion, and that confusion led to
serious economic problems. As a result, Parliament passed
a law banning the colonies from printing their own money. Of course,
Parliament's authority ran out when the Revolutionary
War began in 1775. That war was a lot longer
and a lot more expensive than anyone had predicted, so
the colonies, taking a page from the king's book,
issued paper currency to help fund the conflict. The bills issued by the
Continental Congress were known as Continentals. Yeah, that makes sense. Unfortunately, when the war
ended in September of 1783, they were pretty much worthless. The newly formed
United States needed to come up with something
to stabilize the economy. So on July 6, 1785, the
Continental Congress of the United States
convened in New York and designated the dollar as
the country's official currency. It was also agreed that
the dollar would work off a decimal system, allotting
100 cents to each dollar. But since this was
Congress, there was no way they were going
to agree on everything. The extent to which the federal
government should dictate financial policy to the states
became a sticking point, and as a result, it
wouldn't be until 1792 that the country would
establish a national mint. And even then, it
wouldn't be until 1862 that the U.S. Treasury would
be able to print dollar bills. In other words, it seems
the American government has been making things
unnecessarily complicated literally since the
day it was born. The word dollar is an altered
form of the Germanic word thaler, which itself
is an abbreviated form of Joachimsthaler, which was
the name of a silver coin struck in 1519 by the
Kingdom of Bohemia. Still with me? OK, let's keep going. The coin got its name because
it was made from silver mined in St Joachimsthal. The word thaler spread
throughout the world. The Dutch variation, [DUTCH],,
made its way to the new world with some of the
earliest immigrants. The modern word dollar
is a direct descendant of the Dutch term. The origin of the dollar sign,
however, is a bit of a mystery. Recognized throughout the
world, the dollar sign is practically synonymous
with US currency. The dollar sign first appeared
in print sometime around 1800, and we know it was widely used
long before the first paper dollar was issued in 1875. But other than that,
all we have is theories. The most widely
accepted theory is that the symbol evolved
from the Spanish peso, which if you recall, was the basic
unit of value in Colonial America during the late 1700s. Documents from that era record
that the peso was abbreviated with the letters P
and S. Historians believe that over
time, the two letters were written on
top of each other, creating a symbol
that eventually mutated into the dollar sign. In 1861, Congress needed money
to finance the Civil War. And to that end, it authorized
the issuance of demand notes in denominations of
$5.00, $10, and $20. The $10 denomination was adorned
with a portrait of President Abraham Lincoln, making
him the first US president to have his face on a bill. The reverse side
of the notes was printed using a special
anti-counterfeiting ink that was green in color. As a result, the bills
were nicknamed greenbacks. The first $1.00 bill was
issued a year later in 1862, featuring a portrait of Treasury
Secretary Salmon P. Chase. Chase is the namesake
of Chase Bank, even though he didn't
actually have anything to do with that business. They just kind of
stole his name. Eh, should have gone
with Salmon Bank The modern look of the $1.00
bill officially dates to 1963, but many of the design elements
that we associate with it were actually introduced in 1929. For example, the 1929 bill
ditched Salmon P. Chase's mug for the now famous portrait
of George Washington, which was created by Gilbert Stuart. The reverse side
of the 1929 bill had a large stylized
number one on it. That would change in 1935,
when the one was replaced with the Great Seal
of the United States and that weird
pyramid topped off with the oddly psychedelic
Eye of Providence like the side of an
airbrushed gig van. In 1957, the words In
God We Trust were added. Because if you want people
to back your currency, you tell them it's what
God keeps in his wallet. Anyone who has ever spent some
time examining a dollar bill has noted that it is covered
in symbols, some of which are seriously weird. Like so weird you wouldn't
carry it around in your pocket if it wasn't money. To start, there's the
aforementioned Great Seal of the United States. The seal depicts an
American eagle in flight, holding 13 arrows of
war in its left talon and an olive branch of piece
in its right talon, which might be a confusing
message, but it is a seriously rad looking eagle. The eagle on the great
seal also carries a banner in its beak, which
reads "e pluribus unum," a Latin phrase meaning
"out of many, one," a reference to a country
made of many states. And the 13 stars above
the eagle represent the 13 original colonies as well
as the birth of a new nation as if it were a new
constellation in the universe. Well, that certainly
doesn't lack confidence. Across from the Great Seal is
the most confounding image, an unfinished
pyramid of 13 rows, allegedly symbolizing
strength and duration. The lowest row and the pyramid
has the number 1776 emblazoned in Roman numerals,
and just below it is a banner that reads
"novus ordo seclorum," which means "a new order of
the ages," referring to a new form of government. At the top of the pyramid is
that paranoia-inducing Eye of Providence which
represents the all seeing eye of the divine. It's surrounded by
the Latin phrase "annuit coeptis," which
means "Providence has favored our undertakings," Providence
in this case referring to the protective
care of God, and not the capital of Rhode Island-- probably. The dollars we spend today are
printed on a very special kind of paper made by
Crane and Company, a Massachusetts-based
manufacturer that has been providing the US
Bureau of Engraving and Printing with paper for
currency since 1879. This paper is 25%
linen and 75% cotton and has tiny red and blue
fibers of various lengths evenly distributed throughout it. The paper serves as an
anti-counterfeiting measure, since it's not available
to the general public. But that's just one of several. There's also the use of
color shifting ink, which changes the ink color from green
to black when the bill is held at different angles,
sort of like a Magic Eye or that meme about the
black and blue dress. Or was it white and gold? Modern bills also
have a security thread woven into the paper. These threads run
from top to bottom and display the
currency denomination. You see the security
thread for yourself by holding a bill
up to the light. Even cooler, if you shine
an ultraviolet light on one, it will glow a certain color
respective to each bill. That particular
feature may be less about counterfeit protection
and more about just having fun. There's also microprinting--
words that appear in a font so tiny they just
look like solid lines unless placed under
magnification. Yet another
anti-counterfeiting measure is the inclusion of a watermark. Located just right
of the portrait, the watermark can be seen
from both sides of the bill. On the 10, 20, 50, and 100,
it's another image of the bill's featured president. But on the five, for some
reason, it's the number five. There are no watermarks
on the $1.00 bill. If you're trying to conquer the
criminal underworld by printing counterfeit singles,
the government apparently feels like you could
use all the help you can get. You may have noticed that
old money is hard to find. That's because as
new money is printed, old money is gathered
and destroyed. In fact, money is
destroyed every day by one of three entities--
the Bureau of Engraving and Printing, the US Mint,
or the Federal Reserve. The chief reason
bills are destroyed is that they've become damaged
or mangled during circulation. Damaged bills can't be
used in vending machines ATMs or other
electronic bill readers, so they need to be taken
out of circulation. And this happens more
often than you'd think. In fact, the average life of
a $1.00 bill is only about 3 and 1/2 years. That's less time than it takes
to crank out a Thor sequel. Bills submitted to the
Federal Reserve Banks are checked for fitness
by a high speed sorting machine called the Banknote
Processing System 3000. The machine checks
bills for defects like tears, limpness, graffiti,
dog ears, or excessive soiling. Eh, only excessive soiling? I want my money with no soiling. Any bill that isn't up to snuff
is shredded by the machine and then buried in a landfill
or handed out as a souvenir to people taking Federal
Reserve Bank tours. The amount of money
the fed destroys varies from year to
year but is usually in the neighborhood of $5 to $7
billion, which seems wasteful. Can't they just give
the old money away? You know, to me? So what do you think? Which fact about the dollar's
history surprised you the most? Let us know in the
comments below. And while you're at it, check
out some of these other videos from our Weird History.
