View source for Dollar (U.S.)

==History==
===Bimetallism===
The dollar grew out of the need for a single currency to unite [[the colonies]].  The creation of the dollar was authorized by the [[Continental Congress]] as a currency backed by both [[gold]] and [[silver]].  The fluctuations in the prices of gold and silver led to the decrease in the amount of [[precious metals|metal]] exchangeable.  

[[Inflation]] was an issue during the [[Civil War]], notably in the [[Confederacy]]. For this reason, privately minted currency (today referred to as "civil war tokens") was used. Following the Civil War, private currencies failed, state-specific currencies were [[tax]]ed out of existence, and the US dollar became the medium exchange for the United States. After the Civil War, the United States experienced an extreme [[deflation]]ary period, ending after the [[President]]ial campaign of 1896.

Eventually, the discovery of large [[silver]] deposits in the western United States caused the price of silver to drop. [[Farm]]ing interests and [[borrower]]s wanted to continue the silver system which would build in inflation, allowing the easier payment of [[debt]]s. Banking interests advocated switching to the [[Gold Standard]], which could allow for some inflation by changing the [[gold to dollar ratio]], but would make for a more stable dollar.  This led to the populist "Cross of Gold" speech by [[William Jennings Bryan]].

===Gold standard===
During most of the twentieth century, the US dollar was [[hard money|backed by gold and silver]]. This was true even after the creation of the [[Federal Reserve|Federal Reserve System]] in 1913, when gold was fixed at $20/ounce. During this time, there were several circulating forms of paper currency, including Federal Reserve Notes, Silver Certificates, Gold Certificates, and United States Notes (which were issued directly by the Treasury and exchangeable for any of these). The Treasury seal on each type of bill was stamped with a different color (Green, Blue, Gold, and Red, respectively).

During the [[Great Depression]], [[Franklin Delano Roosevelt]] issued an [[executive order]] (like a financial [[eminent domain]] "theft") which forced all [[American]]s to exchange their gold for $35/ounce in [[fiat currency]]. This remained law in which ownership of gold specie was illegal until 1976.

===Pre-1965 Silver===
During the 1960s, the demand for silver (and its price) rose due to the dawn of [[electronic]]s. [[Quarter]]s and [[dime]]s (then made from 90% silver - now called "[[Junk silver]]", "[[Constitutional silver]]" or "[[pre-1965 silver coins]]") were issued with a new "clad" composition in 1965, and Silver Certificates were redeemed by holders and no longer circulated. The [[half dollar]] was given a 40% "silver-clad" composition until it also became clad in 1971.<ref>http://www.coinflation.com/</ref>

===Richard Nixon ends the Gold Standard===
[[File:US Dollar share of reserve currencies.PNG|right|300px|thumb|U.S. Dollar share of global reserve currencies since passage of [[Russian sanctions]] beginning with the [[Magnitsky Act]] after the [[Obama/Biden]] [[Maidan coup]] in 2014.<ref>[https://www.nakedcapitalism.com/2024/01/status-of-us-dollar-as-global-reserve-currency-and-usd-exchange-rates-long-slow-uneven-decline-continues.html Status of US Dollar as Global Reserve Currency and USD Exchange Rates: Long, Slow, Uneven Decline Continues], January 2, 2024, By Wolf Richter, editor at Wolf Street. Originally published at Wolf Street. www.nakedcapitalism.com</ref>]]
In the early 1970s, the [[trade deficit]] and [[inflation]] in the United States caused a [[bank run]] on the [[gold reserve]]s used to back the United States dollar. To combat this, [[President]] [[Richard Nixon]] removed the [[Bretton Woods System]] in 1971. This resulted in the value of the dollar being set via trading in the [[foreign exchange]] ([[FOREX]]) market, the removal of restrictions on gold ownership, and the price of gold in the US being set by the [[free market]].

The US Treasury stopped issuing United States Notes in 1971,<ref>http://www.treas.gov/education/faq/currency/legal-tender.shtml</ref> leaving only the "green seal" Federal Reserve Notes in production and circulation.

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