Daily entries from the 17th century London diary
If you would like to write a summary for this topic, email phil [at] gyford [dot] com
Wikipedia
| Spanish dollars | ||||||
|
||||||
|
||||||
|
||||||
|
||||||
|
||||||
The Spanish dollar (also known as the piece of eight (peso de ocho), the real de a ocho or the eight-real coin) is a silver coin, of approximately 38 mm diameter, worth eight reales, that was minted in the Spanish Empire after a Spanish currency reform in 1497. Its purpose was to correspond to the German thaler. In Australia, in the colony of New South Wales, Spanish dollars sent by the British government had their centers punched out to make two coins from each dollar. This created the first official currency produced specifically for circulation in Australia. It was the coin upon which the original United States dollar was based, and it remained legal tender in the United States until the Coinage Act of 1857 discontinued the practice. Because it was widely used in Europe, the Americas, and the Far East, it became the first world currency by the late 18th century. Aside from the U.S. dollar, several other existing currencies, such as the Canadian dollar and the Chinese yuan, as well as several currencies in Latin America and the Philippine peso, were initially based on the Spanish dollar and other 8-reales coins.
The term peso was used in Spanish to refer to this denomination, and it became the basis for many of the currencies in the former Spanish colonies, including the Argentine, Bolivian, Chilean, Colombian, Costa Rican, Cuban, Dominican, Ecuadorian, Guatemalan, Honduran, Mexican, Nicaraguan, Paraguayan, Philippine, Puerto Rican, Peruvian, Salvadoran, Uruguayan, and Venezuelan pesos.
[edit] History
Main article: Currency of Spanish America
[edit] Etymology of dollar
In the 16th century, Count Hieronymus Schlick of Bohemia began minting coins known as Joachimsthalers (from German thal, or nowadays usually Tal, "valley", cognate with "dale" in English), named for Joachimsthal, the valley where the silver was mined (St. Joachim's Valley, now Jáchymov; then part of the Holy Roman Empire, now part of the Czech Republic).[1] Joachimstaler was later shortened to taler, a word that eventually found its way into Norwegian, Danish and Swedish as daler, Czech and Slovene as tolar, Polish as talar, Dutch as daalder, Amharic as talari, Hungarian as tallér, Italian as tallero, Greek as taliro (τάληρο), Flemish as daelder, and English as dollar.[1]
"The Joachimsthalers weighed 451 Troy grains of silver. So successful were these coins that similar thalers were minted in Burgundy, Holland, and France; most successful of these was the Maria Theresa thaler, which began being minted in 1751 and formed a considerable portion of American currency after that date."[2]
English speakers began to apply the word "dollar" to the Spanish peso or "piece of eight" by 1581.[3]
[edit] Spain
After the introduction of the Guldengroschen in Austria in 1486, the concept of a large silver coin with high purity (sometimes known as "specie" coinage) eventually spread throughout the rest of Europe. Monetary reform in Spain brought about the introduction of an 8-reales coin in 1497.
In the following centuries, and into the 19th century, the coin was minted with several different designs at various mints in Spain and in the new world, having gained wide acceptance beyond Spain's borders. The main new world mints for Spanish dollars were at Potosí, Lima, and Mexico City, and silver dollars minted at these mints could be distinguished from the ones minted in Spain, by virtue of the Pillars of Hercules design on the reverse. In the 19th century, the coin's denomination was changed to 20 reales (based on 20 reales de vellón) and finally 2 escudos.
Spain's adoption of the peseta and its joining the Latin Monetary Union meant the effective end for the last vestiges of the Spanish dollar in Spain itself. However, the 5-pesetas coin was slightly smaller and lighter but was also of high purity (90%) silver.
In the 1990s, commemorative 2000-pesetas coins were minted, similar in size and weight to the 8 reales and also with high fineness.
[edit] Mexico
Following independence in 1821, Mexican coinage of silver reales and gold escudos followed that of Spanish lines until decimalization and the introduction of the peso. The Mexican 8-reales coin (eventually becoming a 1-peso coin) continued to be a popular international trading coin throughout the 19th century.
After 1918, the peso was reduced in size and fineness, with further reductions in the 1940s and 1950s. However, 2- (1921), 5- (1947) and 10- (1955) peso coins were minted during the same period, similar in size and fineness to the old peso.
[edit] Ireland and British colonies
The term cob, for a piece of eight or a Spanish-American dollar, was used in Ireland and the British colonies during the period when Spanish-American gold and silver coins were irregularly shaped and crudely struck.
[edit] Australia
When the colony of New South Wales was founded in Australia in 1788, it ran into the problem of a lack of coinage. In 1812, Governor Lachlan Macquarie took the initiative of using £10,000 in Spanish dollars sent by the British government. To prohibit use outside of the colony and to double the number of coins, they simply punched out the centers of the coins. Both the central plug (known as the "dump") and rims (known as "holey dollars") were stamped with a sunburst. The punched centers were valued at 15 pence and the outer rims became five-shilling pieces. The mutilated coins became the first official currency produced specifically for circulation in Australia.[4]
[edit] United States
The Coinage Act of 1792 created the United States Mint, but the first U.S. dollars were not as popular as the Spanish dollars, which were heavier and were made of finer silver. Indeed:
By far the leading specie coin circulating in America was the Spanish silver dollar, defined as consisting of 387 grains of pure silver. The dollar was divided into "pieces of eight," or "bits," each consisting of one-eighth of a dollar. Spanish dollars came into the North American colonies through lucrative trade with the West Indies. The Spanish silver dollar had been the world's outstanding coin since the early 16th century, and was spread partially by dint of the vast silver output of the Spanish colonies in Latin America. More important, however, was that the Spanish dollar, from the 16th to the 19th century, was relatively the most stable and least debased coin in the Western world [2]
An eight-real coin nominally weighed 550.209 Spanish grains, which is 423.900 troy/avoirdupois grains (0.883125 troy ounces or 27.468 grams), 0.93055 fine: so contained 0.821791 troy ounces (25.561 g) or 394.460 grains fine silver. Its weight and purity varied significantly between mints and over the centuries. In contrast, the Coinage Act of 1792 specified that the U.S. dollar would contain 371 4/16 grain (24.1 g) pure or 416 grain (27.0 g) standard silver. This specification was based on the average weight of a random selection of worn Spanish dollars which Hamilton caused to be weighed at the Treasury.
The coins had a nominal value of eight reales ("royals").
Before the American Revolution, owing to British mercantilist policies, there was a chronic shortage of British currency in Britain's colonies. Trade was often conducted with Spanish dollars that had been obtained through illicit trade with the West Indies. Spanish coinage was legal tender in the United States until an Act of Congress discontinued the practice in 1857. The pricing of equities on U.S. stock exchanges in 1/8-dollar denominations persisted until the New York Stock Exchange converted first to pricing in sixteenths of a dollar on June 24, 1997, and shortly after that, to decimal pricing.
Long tied to the lore of piracy, "pieces of eight" were manufactured in the Americas and transported in bulk back to Spain (to pay for wars and various other things), making them a very tempting target for seagoing pirates. The Manila galleons transported Mexican silver to Manila in Spanish Philippines, where it would be exchanged for Philippine and Chinese goods, since silver was the only foreign commodity China would take. In Oriental trade, Spanish dollars were often stamped with Chinese characters known as "chop marks" which indicate that particular coin had been assayed by a well-known merchant and determined to be genuine.
Thanks to the vast silver deposits that were found in Mexico (for example, at Taxco and Zacatecas) and Potosí in modern-day Bolivia, and to silver from Spain's possessions throughout the Americas, mints in Mexico and Peru also began to strike the coin.
Millions of Spanish dollars were minted over the course of several centuries. They were among the most widely circulating coins of the colonial period in the Americas, and were still in use in North America and in South-East Asia in the 19th century. They had a value of one dollar when circulating in the United States.
The coin is roughly equivalent to the silver thaler issued in Bohemia and elsewhere since 1517.
[edit] Fiction
In modern pop culture and fiction, "Pieces of Eight" are most often associated with the popular notion of pirates.
[edit] Fictional portrayals
- In Robert Louis Stevenson's Treasure Island, Long John Silver's parrot had apparently been trained to cry out, "Pieces of eight!" This use tied the coin (and parrots) to fictional depictions of pirates. Deriving from the wide popularity of this book, "Pieces of eight" is sometimes used to mean "money" or "a lot of money", regardless of specific denomination.
- In Pirates of the Caribbean: At World's End the Pirate Lords must meet together by presenting the "Nine Pieces of Eight", since these Pieces were used to seal the goddess Calypso in her human form by the first Brethren Court. As the Pirate Lords were, at the time of sealing Calypso into her human form, too poor to offer real Spanish dollars, they opted to use personal talismans instead, except for the "ninth piece of eight" (Jack Sparrow's) was an actual piece of eight that is hanging off his bandana in all movies.
- In Neal Stephenson's The Baroque Cycle numismatics, gold and pieces of eight are an integral part of the plot. In the second volume The Confusion there is also a subtle reference to the fact that a piece of eight is composed of 8 "bits" (it is thus a sort of "byte" and a unit of information transfer).
- In Daniel Defoe's Robinson Crusoe, Pieces of Eight are also mentioned among the types of currency that the title character encounters.
- Pieces of eight are used as currency in the Monkey Island series of video games.
[edit] See also
[edit] References
- ^ a b National Geographic. June 2002. p. 1. Ask Us.
- ^ a b Rothbard, Murray, Commodity Money in Colonial America, LewRockwell.com
- ^ Oxford English Dictionary, entry on "dollar," definition 2 ("The English name for the peso or piece of eight (i.e. eight reales), formerly current in Spain and the Spanish American colonies").
- ^ National Museum of Australia collection highlights: Holey dollar
[edit] External links
- Hispan collections
- HISPAN 1776
- Information on Columnarios
- The Colonial Coinage of Spanish America: An introduction by Daniel Frank Sedwick
Annotations
-
Pieces of Eight…Morgan’s raid on Portobelo.
(Summary from Pope’s Biography of Morgan)
When Morgan returned to Jamaica he brought 250,000 pieces of eight and other merchandise. Pieces of eight were legal currency in Jamaica and valued at 5 shillings.
Each seaman received £60 and the King’s share was £600. (The King’s share was kept to repair the fortifications at Port Royal).
250,000 equalled £62,500, and because of the changes in value since 1668, to understand the value it is best to compare other values and costs.
It compares favourably with the value of London’s entire export to “all” the Plantations being £107,000.
Three times the customs paid in 1676-7 by Barbados, Nevis, Antigua, Montserrat, St.Kitts and Anguilla being £20,700.
It was almost exactly a tenth of the year’s exports from the Plantations to England being £605,000.
-
“…in 1644 one piece of eight was valued in England at four shillings and sixpence”
From:
http://www.pubcat.org.uk/encyclo/categories.asp?categories=MoneyThis is why they’re called “pieces” of eight…
http://www.pensacolahistory.org/historymystery.htmYou can still buy them today…
http://www.alleywayz.com/piecesofeight.htm
http://www.alleywayz.com/mbrindamour/jewerly/jewerly_01.htm -
The origin of the name
“The peso had a nominal value of eight reales (“royals”). The coins were often physically cut into eight ‘bits,’ or sometimes four quarters, to make smaller change. This is the origin of the colloquial name ‘pieces of eight’ for the coin, and of ‘quarter’ and ‘two bits’ for twenty-five cents in the United States.” http://en.wikipedia.org/wiki/Pieces_of_eight
-
On the exchange rate problem with reference to the “pieces of eight” — and why the lower exchange rate should be preferred — see the diary entry for 11 May 1663, and annotations:
-
It’s true that sometimes the eight reale coin was sometimes broken up, and weight determined the value of the piece,however they were also minted and in some cases hand pounded (cobs)into coins of a specifis denomination I.E 1/2 reale 1 reale,2 reale,4 reale etc. Coins that were produced in places where there was’nt a mint, were hand made by certified representitives of the King and had a stamp of the kings coinage coat of arms,these were made under strict government control and anyone caught trying to counterfeit these coins was beheaded!