Massachusetts Historical Society
America's oldest historical society, founded 1791.

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"An Act to prevent Paper Bills of Credit, hereafter to be issued in any of His Majesty's Colonies or Plantations in America ..."

An Act to prevent Paper Bills of Credit, hereafter to be issued in any of His Majesty`s Colonies or Plantations in America ...

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Sinking Credit, Sinking Fortunes
From the outset, colonists have lacked an adequate supply of money. To supplement their scarce British currency, they have used materials like Indian shell money (wampum), stamps, animal skins, and foreign coins as a means of exchange. At times, to respond to immediate needs, colonial legislatures have issued their own paper money-some of which the mother country has outlawed, some of which it has ignored. This state of affairs has kept everyone more or less happy most of the time. England's trade is booming, colonial merchants are occasionally able to pay their bills with devalued notes, London merchants are flexible enough to cover periodic losses, and people throughout the realm are receiving the goods they want. On 19 April 1764, however, George Grenville, in his eagerness to rationalize colonial fiscal policy, tips the scales.

Questions to Consider

1. When is the act due to go into effect?

2. What do you expect will happen to merchants who are holding large quantities of colonial currency?

Further Exploration

3. Each Friday afternoon, your mother has been in the habit of selling you a homemade cupcake, which you purchase with a five-dollar bill from your Monopoly game. Now she tells you that she won't accept the play money any longer. You really want the cupcake. What will you do?