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The Spanish Milled Dollar was the most common coin that circulated in the
American Colonies, and was used in the United States well into the 1800's. The coin was also known as the "pillar dollar" or "piece of eight".
Occasionally, due to its intrinsic weight in silver, the coin was cut into 8
pieces. "Two Bits" of an 8 reale coin, is how the U.S. quarter dollar
got its nickname for many years.
Pine Tree Shilling (1667-1682)
In 1652, the first mint in English America was established at Boston. The
original coins were simple, and had "NE" stamped on them for the New England
Colony. Oak, Willow, and Pine Tree Shillings, with a more complex
design, were soon minted to reduce counterfeiting. The "international
currency" at that time was the Spanish Milled Dollar, and interest in
creating more coins in Massachusetts waned until 1787. The first mint
in the New World was established in Mexico City in 1535, at the home of
Hernando Cortez.
Bill of Credit, America's First Paper Money
The Colony of New England had sent a military expedition
to French Canada in 1690. The cost of the campaign was approximately
50,000 English Pounds. Elisha Hutchinson, of the Committee of Finance,
explained in a public speech, that the expedition "hath run us into debt." Due to "difficulties and necessities", the colony had to pay its debts by
issuing bills of credit or paper money. Silver was scarce and after
paper money was issued, I'm sure it was even scarcer. The New England
Colony was a net exporter of silver, as goods had to be purchased from other
colonies and countries using "hard" currency or silver/gold coins. This is the first instance in
U.S. history where paper circulated as a medium of exchange. The above image is
reproduced from an 1848 guide book, and is an example of the 20 Shilling
denomination.
State of Massachusetts, 1780 Eight Dollar Note
This note is very similar to 1690
bill of credit. An interest rate is published on the lower left,
making this essentially a bond or promissory note. Please observe that
the bill explicitly states it will be paid in Spanish Milled Dollars.
These notes did circulate, as the Revolution was still in progress and
everything was at stake. The citizens had to make due during the struggle.
Related Pages
Depression Currency
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