MONEY

 

See Also: CRIME Forgery; ECONOMICS; LA BELLE

 

Bank Notes1

The concept in Britain of using bank notes as currency grew out of a 17thC practice by which goldsmiths issued bills of exchange that were secured against bullion that they had in their possession. The key factor in their widespread adoption was to make the note cashable to its bearer rather than to a specific person. The Bank of England exploited the existence of this practice to issue its own notes. In 1756 the Seven Years War started. It was the first global war. It was extremely expensive to wage. Gold became scarce, therefore, the Bank started issuing 10 notes. A simple design was used so that counterfeiters mistakes would be easier to spot. Following the return of peace in 1763 the notes remained in circulation. The Napoleonic Wars again placed the British economy under immense pressure. In 1797 the country was taken off the gold standard and did not return to it until 1821. The Bank furnished the economy with liquidity by issuing 1 and 2 notes.

The Bank Charter Act of 1844 stopped any new banks of issue being set up.2 In 1855 stereotype printing was invented. This enabled notes to be printed so that they were virtually identical.

Following the start of the First World War removed gold coins from circulation. The Treasury assigned a contract to print 1 and 10s. to Waterlow & Son. In 1928 the Bank of England was granted responsibility for producing them.

While the Bank remained a private business, its notes did not bear a portrait of the sovereign. The image of Britannia that came to adorn its notes was drawn by the artist Daniel Maclise. It was only in 1961, over a decade after the body's nationalisation, that Queen Elizabeth II's portrait started to appear on bank notes. (In part the image acts as a deterrent against forgery. People are good at detecting a difference in a portrait.)

In 1988 the Bank of England withdrew the 1 note. The Scottish banks continued to issue the denomination. Subsequently, in a number of areas of London banks found that they were receiving requests for the Scottish 1s. It took a while for the reason to emerge. In some communities, notably the Greek Cypriot one, it was customary for wedding guests to pin banknotes onto the bride's gown.

In 2003 De La Rue acquired the Bank of England's Debden works.3 The facility included a note-destruction depot.

In 2016 the Bank of British introduced Britain's first polymer banknote, a 5. However, it was soon reported that vegetarians unhappy that in part it was made from beef tallow.

Location: The Bank of England Printing Works, Langston Road, Debden Estate, Loughton, IG10 3TN

See Also: THE BANK OF ENGLAND; NOT CHOCOLATE; PRINTING; VEGETARIANISM & VEGANISM Notable Beef

Website: www.bankofengland.co.uk/banknotes www.delarue.com

1. The principal Scottish banks, which are commercial businesses, still issue their own bank notes. In 1994 the Royal Bank of Scotland issued two million 1 notes to commemorate the centenary of the death of the writer Robert Louis Stevenson. The note could be bought in a collectors pack that cost 2.50.

2. In 1920 the private bank Fox, Fowler & Company of Wellington, Somerset, stopped issuing bank notes. This left the field in England and Wales solely to the Bank of England, which was itself privately-owned at the time.

3. De La Rue was founded in Guernsey in 1813 to print a newspaper. In 1860 the firm printed its first bank notes. These were for the Bank of Mauritius.

Nazi Notes

During the Second World War the Nazis assembled at Sachsenhausen concentration camp a muster of internees who had the requisite skills to be able to produce high quality, banknote forgeries. The group created 134m worth of 5, 20 and 50 bank notes. The Nazis plan was to try to aid their own cause by destabilising the British economy.1 Because British bank notes were large it was customary for them to be folded and pinned. The prisoner-forgers made pin holes in their creations in order to make them look more authentic. However, surreptitiously they were careful to insert holes through the image of Britannia because they sure that British people would never do so and that therefore there would be a way of telling whether a note had been forged or not.

The authorities in Britain learned of the operation. In 1943 all banknotes, bar 5 ones, were withdrawn. In 1945 the 5 was redesigned. 10 notes were not reintroduced until 1964. The foil security thread that runs through British bank notes is a legacy of the efforts to combat the forgery.

See Also: THE SECOND WORLD WAR

1. In the wake of the Credit Crunch, what was then economic warfare might now be termed by economists as quantitative easing.

 

Coins

Change is inevitable - except out of a vending machine.

England had a silver coinage. King Henry III introduced gold coins. The experiment was abandoned. In response to the florin Edward III introduced the noble. The coin was successful and became a permanent part of the economy.

In about 1341 King Edward III issued the double leopard in the hope that it would become a European-wide currency. About 2000 worth were issued during a six-month-long period. The coin could not be easily divided into a pound.

King Henry VIII was known as Old Copper Nose . This was because he had devalued the quality of the coinage by re-smelting it with copper. If a coin was worn the copper would reveal itself.

In 1982 the 20p. was introduced.

Imagery

The image of Britannia first appeared on British-minted coins during the A.D. 117-138 reign of the Emperor Hadrian.

During the 1837-1901 reign of Queen Victoria Britannia became a symbol of the British Empire.

In 2008 the image of Britannia stopped appearing on new coins, as did the chained portcullis and the crowned lion. However, the occasional use of the imagery was intended.

The Monarch

It is customary for the monarch's profile to switch with each new reign. An exception was Edward VIII who had a strong preference for his left profile.

 

Decimal Currency

In 1710 Russia became the first European country to introduce a decimal currency. The United States did so in 1792 and France in 1803. In 2007 it was revealed that in a four-and-a-half page document John Wilkins (d.1672), the founding Secretary of The Royal Society, had devised a decimal system.

In 1867 a Royal Commission was established to ascertain whether Britain should adopt a decimal currency. It concluded that there was little that the nation would gain through doing so.

In 1961 the government appoint the 3rd Earl of Halsbury to chair the Committee of Inquiry on Decimal Currency. Five years later the Labour government took the decision to decimalise the British currency. In 1969 the half-crown (2s. 6d.) and half-penny ( d.) were withdrawn from circulation. The following year the Conservatives were elected to office. The arrangements for the changeover had progressed too far for the Tories to be able to stop them. On 15 February 1971 the currency was switched. In the public mind the change came to be associated with inflation. Some elderly people objected to the use of pee as an abbreviation for pence.

See Also: CHAMPAGNE Secondary Fermentation

 

F.D.

In the early 1520s King Henry VIII was still a loyal Roman Catholic. In 1521 he wrote a tract that attacked the Lutherans and their actions. This was published across Europe. In thanks for it, Pope Leo X granted the monarch the title of Fidei Defensor, which is still commemorated on coins by the letters F.D.. Martin Luther was sufficiently stung by monarch's composition that he wrote a reply to it. This was so defamatory that the king could not in decency respond to it. Therefore, the royal servant Thomas More involved himself in the matter and pseudonymously penned Responsio ad Lutlerum (1523).

See Also: SIR THOMAS MORE

 

The Florin

An English florin made of gold was in circulation during the 14thC. The coin's name was derived from fiore, the Italian word for a flower, there having been one depicted upon the first Italian coin to have the name.

In 1848 a 2s. coin was introduced. This became known as a florin.

See Also: ITALIANS The Lombards

 

The Guinea

The guinea was a 20s. ( 1) coin that the Royal Mint first struck in 1663. It was made with gold that had been shipped from Guinea in West Africa, hence the name. It included the image of an elephant below that of King Charles II. However, during the early 1690s the value of English silver coinage declined as a result of people clipping the coins. The value of the guinea, which was not subject to the same pressures, began to rise, reaching 30s. in 1694. A recoinage of the silver currency improved matters but it did not settle them; merchants became aware that England's silver coins were worth more as bullion overseas than they were as coins in England. Sir Isaac Newton, in his capacity as the Warden of the Royal Mint, was asked by the Treasury for his opinion on the matter. He replied that the value of guinea should be set below its then rate of 21s. 6d.. His advice was not acted upon. Eventually, in 1717, the coin should be fixed at 21s. ( 1.05p).

In 1813 the final guineas were struck. Four years later the coin passed out of legal circulation. However, by then it had become customary for certain non-everyday items - such as paintings, racehorses, and the fees of some professionals - to be paid for in guineas as the money of account.

See Also: SIR ISAAC NEWTON; TRADING COMPANIES

 

The Pound Sign

The £ sign is an adaptation of the letter L. It stood for libra (pound), an abbreviation of libra pondo (pound by weight). Originally, libra pondo was expressed as lb.. However, it was appreciated that the letters could be mistaken for the number 16. By the 14thC scribes had taken to distinguishing the letters from the number by drawing a horizontal line through them. The first known instance of a sign was on a cheque that was handwritten in 1661.

 

The Royal Mint

In about 1280 the Royal Mint was first established within the Tower of London. In 1810 coins were minted in the Royal Mint buildings at Tower Hill.

In 1870 the Mastership of the Mint became attached to the Chancellorship of the Exchequer, a political office.

Since 1968 coins have been minted at Llantrisant in South Wales. The facility produces much of the world's coinage.

Location: The Tower of London, EC3N 4AB (purple, orange)

Royal Mint Court, EC3N 4QN (purple, red)

See Also: BELLS The Whitechapel Bell Foundry

Website: www.royalmint.com

Sir Isaac Newton

In the early 1690s clippers and counterfeiters degraded the quality of England s silver coinage. This caused economic stresses that were compounded by the government's need to meet the costs of conducting the Nine Years' War (1688-97).

In 1695 the government asked eight men of financial expertise or intellectual achievement - of whom Newton was one - to examine what courses of action the Royal Mint might pursue in order to address the crisis. Seven members of the panel advocated recoinage as the optimum means of restoring the value of the currency. The state endorsed this view.

The following year the ministry offered Newton the post of Warden of the Royal Mint. He accepted it with alacrity. His appointment was facilitated by the leading Whig politician the 1st Earl of Halifax. Both men were Fellows of Trinity College Cambridge.

As Warden, Newton proved to be an excellent administrator. He quickly came to appreciate that while he might possess the most senior post within the Mint, he did not hold the most influential one. That was that of Master, which was filled by Thomas Neale.1 The Warden was paid 400 p.a., while the Master received 500 p.a. and it was the latter who controlled the disbursement of both salaries. In addition, the Master was paid what was effectively a royalty for each pound of gold or silver coin that was minted. Neale received over 22,000 from the recoinage, an operation to which he contributed nothing. In 1699 it was apparent that the man was dying. In a move that was without precedent, Newton used his connections within the government to become the first Warden of the Mint to be demoted to the more profitable junior position. As someone who had engaged in alchemy, Newton had developed a range of knowledge and skills that helped him to hold his own in disagreements with goldsmiths.

In 1717 Newton's beautiful and vivacious niece Catherine Barton married John Conduitt, who was a forthright admirer of Newton. During the mid-1720s he started acting as Sir Isaac's de facto deputy at the Mint. In 1727 Newton died. Conduitt succeeded him as Master.

The French writer Voltaire witnessed the interring of Newton's coffin in Westminster Abbey. He was moved to declare that in England they treated the bodies of intellectuals with a reverence that elsewhere only the remains of emperors received.

See Also: COLUMNS Seven Dials; ECONOMICS Dr Nicholas Barbon; FINANCIAL SCANDALS The South Sea Bubble; SIR ISAAC NEWTON

1. Sir Thomas Neale was not only Master of the Mint, he was also the Groom Porter, a post that required him to supply the dice and playing cards that were used at court.

 

Slang

500 Monkey - Indian 500 rupee note (Hindu monkey note)

200 Bottle - Bottle of spruce cost 2d..

25 Pony - Indian 25 rupee note.

A 2s. coin was called a florin.

A 6d. coin was called a tanner.

A 4d. coin was called a joey.

See Also: LANGUAGE & SLANG

 

Spink & Son

Spink & Son specialises in numismatic items (coins and medals). John Spink established himself as a goldsmith in Lombard Street in 1666.

Location: 67-69 Southampton Row, WC1B 4ET (red, grey)

Website: www.spink.com

 

Tokens

In the 17thC copper started to be used as a metal for minting. Token currencies were used locally as small change.

David Backhouse 2024