Definition of United States note

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TeachMeFinance.com - explain United States note




historic definition...

United States note -- A particular form of paper money issued by the United States and based simply on the credit of the country (not issued against gold or silver on deposit) ; often called greenback (because the back is printed in green) and also legal tender or legal tender note. United States notes were authorized by various acts of Congress passed at the time of the Civil War and were virtually a forced loan. Some of the earlier issues were convertible into bonds , but this provision was abrogated on July 1, 1863. The highest amount at any time outstanding was $449,338,902 on January 3, 1864. The original intention was to redeem the notes and cancel them and by December 31, 1867, the amount outstanding had been reduced to $356,000,000, but Congress on February 4, 1868, passed a law, without the President's approval, suspending further retirement. On March 18, 1869, Congress solemnly pledged the faith of the United States to the payment of these notes in coin or its equivalent and to make provision at the earliest practical moment for their redemption. During the panic of 1873 the issue was increased to $382,979,815, but under authority of the resumption act, January 14, 1875, retirement of the notes was again undertaken and by May 31, 1878, the amount outstanding had been reduced to $346,681,016, where it has remained ever since, as on that date Congress passed an act forbidding further cancellation and directing the reissue of such as might be redeemed. The resumption act went into effect January 1, 1879. On December 17, 1878, for the first time since 1861, the notes reached parity with gold, where they have remained ever since. Their lowest status had been reached in 1864, when they were worth less than fifty cents on the dollar.



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Mark McCracken

Author: Mark McCracken is a corporate trainer and author living in Higashi Osaka, Japan. He is the author of thousands of online articles as well as the Business English textbook, "25 Business Skills in English".


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