Gold and the Gold Standard

CHAPTER I

The Place of Gold in the Money of Ancient and Medieval Times

Speak of the moderns without contempt and of the ancients without idolatry; judge them all by their merits and not by their age.—LORD CHESTERFIELD, 1748.

ORIGIN OF THE GOLD STANDARD

The gold standard in its “orthodox form” is a product of the nineteenth century. Its roots, however, go deep into the past. This chapter will explore briefly this early history of gold as money,1 i.e., as a commonly accepted medium of exchange.

Gold, by reason of its beauty, its world-wide distribution, the facility with which it could be obtained from the streams by crude methods of “panning,” and the ease with which it could be “worked,” probably had a wider use as a medium of exchange in very ancient times,2 and among primitive peoples in modern times, than any other metal.

This metal was first used as money in such forms as nuggets of gold, gold molded in the shape of shells, which served also as ornaments, and gold dust. In ancient Mexico, Africa, and elsewhere, gold was put into transparent quills, which were used as a common means of payment. It circulated in small cubes in China as early as 1100 B.C. Many hundreds of years before the beginning of the Christian Era, gold media of exchange were used in Asia Minor and a large part of Europe. These early media were usually made of almost pure gold, the art of hardening the metal by means of alloy apparently not having been introduced until after the beginning of the Christian Era.

The earliest references I have been able to find in recorded history to the use of one of the precious metals as a medium of exchange—in these cases, passing by weight—are in the Code of Hammurabi,3 King of Babylon. They refer to silver in about the year 1870 B.C.4

The peoples of classical times had very little knowledge of the money of their early ancestors. They had no books on money, and the few written records available to them were chiefly on stone and papyri in the form of laws, decrees, and scattered miscellaneous notes. By far the most important part of our records of these early times consists of the money itself, which has been preserved and is now held largely in the museums of the world, where it is classified and catalogued. The coined money alone of classical times that has been thus preserved runs into tens of thousands of pieces; and the weights of these pieces, the materials of which the coins are made, their forms, and especially the designs and legends that they bear give us valuable information.

Thanks to the careful studies made by classical scholars over many generations, we know today much more about the money of classical times than the ancients knew. There are, however, many gaps in the chronology of the coins that have come down to us, and the story that these coins tell is far from complete. It is still full of controversial questions concerning which the modern literature is voluminous, but progress in their solution is being, made continually.5

EARLY COINAGE IN ASIA MINOR

Coinage was originally of the nature of a seal or hallmark punched on a nugget of metal as a guarantee of its quality or its weight. The beginnings of coinage appear to have been made in the countries of the eastern Mediterranean early in the eighth century B.C.6 Sennacherib, King of Assyria (705-681 B.C.), said, “I built a form of clay and poured bronze into it as in making half-shekel pieces.”

Many of the early coins were made of electrum—a natural alloy, consisting of about three parts of gold to one part of silver, which was found abundantly in Lydia and which caused that country to be known as the land of gold. Because of the difficulty in separating the gold from the silver, the ancients regarded electrum almost as a distinct metal. Early coins of pure gold in Asia Minor were probably made from placer gold obtained from the valley of the Oxus or from the Ural Mountains.7 The electrum coins were ancient examples of what in modern times is called symmetallism.

I have in my possession a gold daric, one of the oldest and most famous gold coins in history. It is made of almost pure gold and is about the weight of our late American $5 gold piece. It looks like a roughly molded gold nugget and bears a crude stamp of an archer with his bow and spear. The coin was made during the reign of Darius the Great of Persia, about 500 years before Christ. Only about two generations before this, in the reign of Croesus, which began 561 B.C., there circulated in Asia Minor the coins of which Herodotus said, “The Lydians were the first people, so far as I know, to adopt a gold and silver coinage.”8

In those early times, gold coins and silver coins circulated for several centuries under a dual standard. Gold gained in importance at the time of Alexander the Great, under the stimulus furnished by the large amount of gold produced in his Pangean mines.9

COINAGE IN THE LAND OF THE GREEKS

In Homeric times values in Greece were reckoned in terms of the cow. According to Ridgeway, “. . . weighing was first invented for traffic in gold, and since the weight-unit of gold is found regularly to be the value of a cow or ox . . . the unit of weight is ultimately derived from the value in gold of a cow.”10 Our English word pecuniary, which is derived from the Latin pecus, meaning “cattle,” is a monument to this development. Copper was early used as money. The first oboi was apparently a copper spike or skewer, six of which made a drachma, meaning “handful.”11

The first gold coin to circulate in Hellas proper was the aforementioned Persian daric or stater (meaning “to weigh”), which weighed about 130 grains and which enjoyed an extensive circulation for several centuries. It was never debased and was “practically the only gold coin for about 200 years, as well in Asia Minor and the mainland of Greece as in the Persian Empire.”12 It was known in Palestine during Biblical times.

The Greeks learned the use of gold coin from the Asiatics, but they were slow to coin gold themselves. The first place in Hellas proper to mint money was Aegina, which was a commercial center. The silver coins of this small island and the Persian gold darics circulated extensively in Magna Graecia. Solon is believed to have been the first person to coin silver money in Athens. Coins of silver and gold apparently passed at approximately their respective bullion values. In this dual-standard system, silver coins were those most widely used, but gold coins played an extensive part in the country’s foreign trade, also in many of the larger domestic transactions and for reserves in the temples. In times of war and other great emergencies, there was an increased coinage of gold from metal obtained by melting down golden statues and ornaments, which were obtained largely from the temples.

Early in the fourth century B.C., the silver coinage of Rhodes was supplemented by an issue of gold staters, and this double issue of gold and silver continued unbroken13 until after the death of Alexander the Great in 323 B.C.

In the Greek world there were, on occasions, official ratings of the coins of one metal in terms of those of the others. Ratings were changed from time to time and recoinages were made, to prevent a cheaper or overrated metal from driving out of circulation a dearer or underrated one, under the force of what we now call Gresham’s law.14

About the beginning of the fourth century B.C., we find a case of monetary debasement suggestive of our American debasement of 1933 to 1934.15 Dionysius, Tyrant of Syracuse, who had borrowed heavily from his citizens and was being hard pressed for repayment, directed that all the coins in the city should be brought to him, under penalty of death. He then restamped the coins and gave to each drachma the value of two drachmas. By this debasement he was enabled to pay off the original loan and, at the same time, repay the money that he had ordered to be brought to the mint.16

Shortly after the death of Alexander, the unified Attic monetary system, which prevailed throughout most of his empire, began to disintegrate. Concerning what followed, down to the time of the conquest of the Greek world by the Romans, M. Rostovtzeef says :17 [Alexander’s] successors continued his coinage but each for himself in his own name: Coinage was one of the signs and symbols of political independence, it was a powerful instrument of political influence and propaganda, and it yielded a substantial revenue. With the further disintegration of his empire, coinage became ever more diversified, each sovereign State, whether a monarchy or a city, minting its own money.

THE POSITION OF GOLD IN THE MONEY OF ANCIENT ROME

Gold played a much less important role in the money of Italian lands in early historic times than it did in Asia Minor and in Greece. Nonetheless, in the form of ingots and of foreign coins, it was used there as money to some extent as early as the fourth century B.C. Some gold coins were struck in the year 206 B.C., at the time of the Second Punic War. By the fourth century A.D., there was a preference for gold over silver and by the seventh century the preference for gold was well established. Accounts were often kept in terms of gold, even when payments had to be made in silver or bronze. The following brief history of money during classical times among the Romans will show the place of gold.

Bronze Money. In Italy, as elsewhere, one of the first forms of metallic money consisted of unstamped bullion. But here, unlike the situation in some other places, where gold was readily available, the first metal to circulate was bronze. Originally, the bronze circulated in the form of a rough lump (aes rude), the lumps varying in weight, shape, and size, and bearing no stamp. Later it was hammered into the form of a bar, known as an as18 (meaning “unit”) in order to give it a convenient form for bartering the metal, which was in demand for the making of tools, weapons, and utensils. As time went on, the conventional length of this bar became a foot (the length of a man’s foot), which, with the conventional diameter, gave the bar a convenient weight of about 1 pound.19 The bar was later marked off into 12 thumbs, or inches. Since these bars (asses) varied considerably in weight, the custom gradually developed of passing them by weight instead of by tale. The weight of metal then became the important consideration, and the unit of value became the pound of bronze, the as libralis, while the 12 thumb divisions, or inches, became 12 ounces.20

Summing up this development, Ridgeway says:21

There is no positive evidence to show that the original monetary as was a foot long, but, as the as-pes, it is certain that the as was originally a piece of copper a foot in length and of a known thickness. As soon as the rods or asses were exchanged by weighing, they began to lose their original form, which was only essential so long as it was necessary that they should be of certain fixed dimensions. Under the new system the shape mattered not, provided the as was of full weight when placed in the scale.

Weighing bronze was, however, inconvenient, and the practice developed toward the close of the regal period of placing upon the asses an authoritative stamp certifying their weight, so that again they could pass by count. There are early records of 2-pound bars and also of bars of ½ and ¼ pound. The earliest coin marks on the bars that we have preserved are crude drawings of animals. According to Pliny,22 “King Servius first stamped bronze.. . . It was stamped with the impressions of animals, whence it was termed pecunia ...”

The as of bronze, which developed as a commodity-money unit of value very early in Roman history and was first coined about 300 B.C., played an important part in that history for centuries. According to Mattingly, “The bronze coinage was paramount from the beginnings down to c. 245 B.C.. . . ”While from 245 B.C. to 217 B.C. it played an equally important part with silver,23 after 217 B.C. silver dominated, and during the second century the bronze coinage became increasingly subsidiary.

During its early history, the coined as (with its divisions and multiples) was a commodity-money unit, i.e., it circulated at its bullion value of 1 pound of bronze, and was known as the as libralis. It was the standard unit of value. As standard money, it suffered several debasements. During the First Punic War, according to Pliny, the weight of the as was reduced, “when the republic, being unable to defray its expenses, resolved to coin six asses out of the pound; whereby they gained five parts, and paid their debts.” Before the end of the Second Punic War, the as had been debased again by 50 per cent, thereby reaching a weight of 1 ounce, the as uncial. Somewhat later, the as coins became token money, subsidiary to silver. As such, their weights were further reduced from time to time, but since they were mere token coins, these reductions probably did not materially affect their money value.

Long after the as libralis ceased to circulate, it was used as a unit of account, in terms of which people thought and expressed monetary values even when payments were actually made in the standard silver money.24 In contracts then it appears to have been called the as grave, to distinguish it from the current as.

History has given us a descendant of the word as (unit) in our word ace and descendants of the word aes (bronze), as used in aes rude (p. 10), in our words esteem and estimate.

Silver Money. Silver in the form of ingots and of foreign coins, notably those of the Greeks, Etruscans, and Sicilians, circulated in Italy during part of the bronze-standard period just described. According to Mattingly,25 the aes grave of Rome and Italy, which we have previously mentioned, represented “only a short stage of transition from the early use of uncoined bronze as a measure of value, to the Greek use of silver money . . . ” Rome, learning the use of silver and of token bronze from the Greeks of southern Italy, was led to give at least the form of a coinage to the bronze that she was accustomed to use for trading with the Italian peoples.

It was inevitable that this clumsy coinage should soon give way to the more convenient silver. Accordingly, during the course of the Pyrrhic War, Rome struck her first silver coins, didrachmas (double drachmas) and rare divisions of the didrachma.26 After defeating Pyrrhus and getting control of all southern Italy, shortly before the First Punic War, the Romans obtained there large supplies of silver, which they used in part for the Roman silver coin that was struck in Campania. This coin was the denarius (meaning “every ten”), and was probably equivalent to a didrachma. It was rated at 10 asses and divided into four parts, called sestertii. Although this silver coinage in Rome itself was struck about 268 B.C., it was not until about a half century later that silver became the dominant standard and the sestertius replaced the as as the unit of reckoning.27

In the year 217 B.C. the as was reduced to a standard of 1 ounce and was retariffed at the rate of 16 instead of 10 to the denarius, while the denarius itself was debased. About the beginning of the second century B.C., “the Roman coinage enters on a long period of quiet and orderly movement with little of external change to mark it.”28 This situation continued during the early centuries of the Empire,29 during which, however, silver met increasing competition from gold. The yellow metal finally superseded silver as the dominant standard, just as silver had previously superseded bronze. To this story we shall now turn.

GOLD MONEY DURING THE REPUBLIC

Contemporaneously with the circulation of bronze and silver in Rome and other Italian cities during early times, there was a circulation by weight of gold in the form of nuggets and of foreign coins. This gold was used principally in the larger transactions. Although destined ultimately to supplant both bronze and silver as the basic monetary metal, gold was in this territory the least important of the three, prior to the beginning of the Christian Era. Evidence that there was a substantial circulation of gold as early as the fourth century B.C. is found in the fact that there was a law at that time requiring that a certain tax be paid in gold.30

Under the financial strain of the Second Punic War (218-201 B.C.), Rome for the first time minted gold coins. They were minted out of gold bullion taken from her treasury.31 The weights of these coins were based on the scruple,32 which was one twenty-fourth of the old Roman ounce and equaled 17½ grains. There were coins, of one, two, and three scruples, respectively, with the approximate weights that would correspond to $1, $2, and $3 of United States gold coin prior to 1933. The Romans officially rated these gold pieces in terms of silver at a rate of 20 sestertii to a scruple of gold, a rating so high that apparently the gold coins were treated as tokens. The issue was short-lived.33

No further gold coins were minted by Rome for over a century and a half, until the time of the Roman conquests under the great generals Sulla, Pompey, and Julius Caesar. These generals in the field issued the gold coins under authority of the government at Rome. Much of the metal for making them came to the generals in the form of loot, and many of the coins in turn probably went to the soldiers as rewards. Sulla coined an aureus (meaning gold) of 168 grains and later one of 140 grains. Pompey continued coining it at 140 grains. Julius Caesar reduced it to 126 grains.34 After his death the Senate authorized the ordinary moneyers to coin gold, but coining at Rome was soon superseded by the provincial issues of the triumvirs and their subordinates.35

When, as a result of debasements, coins of different weights were in circulation together in sufficient quantities, Gresham’s law operated, and the lighter weight coins drove the heavier ones out of circulation. A person who could discharge a debt with the same number of lightweight aurei as of heavyweight ones, naturally paid it with the lightweight ones and kept or melted down the heavier ones. Likewise, when the market prices of commodities were the same whether payments were made in lightweight coins or in heavyweight ones, the purchaser would pay with the lightweight ones. It was merely a case of buying in the cheaper market. To the extent that the merchants and others in selling goods made allowance for the differences in the weight of the coins by quoting lower prices when payment was to be made in the heavier coins, a dual standard developed and standard coins of different weights then circulated side by side.36

GOLD MONEY DURING THE EMPIRE IN THE WEST

With the extensive coining of gold by the generals during the later years of the Republic, gold coins came to stay for a long time, although during the following centuries they had many vicissitudes.

Augustus gave gold a place above silver.37 He reduced the aureus from the 126-grains weight given it by Julius Caesar to 122.9 grains. “Gold and silver are both struck almost pure [at a ratio of 12½ to 1]. . . . Brass and copper are struck much more carelessly . . . , i.e., not on ä carefully adjusted weight for each piece, but at so many to the pound.”38 From Augustus to Nero the system was not changed, but the weight of the aureus was gradually reduced administratively, with an accompanyng reduction in the denarius. From the reign of Nero through the reign of Diocletian, the monetary situation throughout the Empire was confused and debasements were common. The reigns of Claudius and Nero witnessed much counterfeiting and a wide circulation of privately made tokens, which were usually of lead.39 Diocletian made two reductions in the weight of the aureus in the year 312, and Constantine the Great put through a monetary reform that fixed the gold content of the aureus at about 70 grains, representing a debasement of approximately 38 per cent since the time of Nero. Thereafter, until the Empire in the West came to its end in 476, gold apparently grew in relative importance40 and was the imperial money par excellence, although the silver denarius and its fractions continued to hold a high place in the business of the Empire.41

THE PLACE OF GOLD IN THE MONEY OF CONTINENTAL EUROPE DURING THE MIDDLE AGES

An elementary historical study of gold in the money of the Middle Ages can be brief, because the records that have come down to us for this period are meager and are not of great significance to the student of monetary science.

Characteristics of the Economy of the Middle Ages

There were three important factors influencing the monetary history of the Middle Ages. The first of these factors was the development of the feudal system, with its large landed estates, its practice of subinfeudation and hierarchy of authority from the overlords down through the various grades of vassals to the serfs and slaves, and with its payments in kind and in personal services. All this made the great manorial estates largely self-sufficient economically. They produced most of what they consumed and consumed most of what they produced. The volume of trade, therefore, relative to the population, was much smaller than it had been in classical times.

The second factor was the circumstance that much of the small amount of trade that did take place was carried on by means of simple barter. Money was unnecessary.

The third factor was that the supply of the precious metals available for money declined in a large part of Europe during the Dark Ages. Widespread looting of occupied territories during the wars of the early Christian Era and subsequently by the conquering Germanic peoples of the North had scattered widely and thinly the accumulated gold and silver treasure of classical times. The yields of the gold and silver mines also declined, partly because the mines were bled white by tenant operators who were little concerned with the conservation of the mines’ resources, partly because most of the labor in the mines was inefficient convict and slave labor, and partly because there was destruction and looting of the mines by the invading barbarians.42

Coinage in Europe during the early Middle Ages was practically limited to silver and copper, except for a temporary minting of gold in the Carolingian period. Silver provided the principal currency of western Europe. The aureus of Constantine, however, continued to circulate until the downfall of the Eastern Empire in 1453, and from this gold unit various coinages of mediaeval and modern Europe were descended.43

Gold Coins

In the year 1252, in response to a growing demand for coins of a larger value, particularly for the foreign trade of the great Italian cities, gold coins containing 48 grains of fine gold were struck in Florence. These became the famous gold florins of Italy.44 Similar gold coins were later minted in Germany and France, and in other cities of Italy—notably, the Venetian zecchino, which had a large circulation extending even to Turkey.

Gold florins issued in the Italian cities were given official ratings with the silver coins then in circulation. The official rating and the market ratio of gold and silver were frequently at variance, with the usual result that coins of the overvalued metal drove from circulation coins of the undervalued one.

Seigniorage

Under the feudal system, the prerogative of coining money was exercised by the suzerain or by persons to whom he gave it as a feudal grant. These grants were so extensively given that by the beginning of the ninth century coinage was greatly decentralized in a large part of Europe. The lords of the manor (or seigneurs, as they were called in France) were privileged to extract from the gold and silver brought to them for coinage a small percentage to cover the expenses of coinage and to compensate them for their work. This percentage, which was supposed to represent the difference between the value of the bullion in the coin and the value of the coin itself, was called seigniorage. The seigneurs, however, developed the practice of extracting from the coin unduly large amounts as seigniorage profits, and during the Middle Ages this was an important cause of currency debasement.

SELECTED BIBLIOGRAPHY

BULLOCK, CHARLES JESSE: Economic Essays, Harvard University Press, Cambridge, Mass., 1936.

BURNS, A. R.: Money and Monetary Policy in Early Times (with Bibliography), Alfred A. Knopf, New York, 1927.

CARLILE, WILLIAM WARRAND: The Evolution of Modern Money, Macmillan & Company, Ltd., London, 1901.

DUBBERSTEIN, W. H. : Comparative Prices in Later Babylonia, American Journal of Semitic Languages and Literature, January, 1939.

Du PUY, WILLIAM ATHERTON: The Geography of Money, with 31 illustrations, The National Geographic Magazine, December, 1927, pp. 744-768.

FINLAY, GEORGE: A History of Greece. Oxford, Clarendon Press, 1877.

GRUEBER, H. A.: Coins of the Roman Republic in the British Museum, British Museum, London, 1910.

HAEBERLIN, E. J.: Die Systematik des ältesten römischen Münzwesen, Verlag der Berliner MÜnzblatter, Berlin, 1905.

———: Aes grave, 2 vols., J. Baer, Frankfurt a./M., 1910.

KEMMERER, EDWIN WALTER: Money, The Macmillan Company, New York, 1935.

LEXIS, W. : Das Münzwesen der neuren Zeit (with Bibliography), Handwörterbuch der Staatswissenschaften, Dritte Auflage, 1910, VI, 847-853.

MCCULLOCH, J. R., Editor: Old and Scarce Tracts on Money, P. S. King & Son, Ltd., London, 1933.

MATTINGLY, HAROLD: Roman Coins from the Earliest Times to the Fall of the Western Empire, Methuen & Co., Ltd., London, 1928.

———: Coins of the Roman Empire in the British Museum, British Museum, London, 1923.

———: A Guide to the Exhibition of Roman Coins in the British Museum, British Museum, London, 1927.

———: The First Age of Roman Coinage, Journal of Roman Studies, vol. 19, 1929.

MEYER, EDWARD: Orientalisches und griechisches Münzwesen (with Bibliography), Handwörterbuch der Staatswissenschaften, Dritte Auflage, 1910, VI, 824-832.

MICKWITZ, GUNNAR: Geld und Wirtschaft im römischen Reich des vierten Jahrhunderts n. Chr., Centraltryckeri och Bokbinderi Aktiebolag, Helsingfors, 1932.

MOMMSEN, THEODOR: Geschichte des römischen Münzwesens, Weidmannsche Buchhandlung, Berlin, 1860.

———; Histoire de la monnaie romaine, translated by de Blacas, 4 vols., Rollin et Feuardent, Paris, 1865-1875.

MORSE, H. B.: The Trade and Administration of China, Longmans, Green and Company, New York, 1913.

PICK, B. Römisches Münzwesen (with Bibliography), Handwörterbuch der Staatswissenschaften, Dritte Auflage, 1910, VI, 832-839.

RAPER, MATTHEW: An Inquiry into the Value of the Ancient Greek and Roman Money, Philosophical Transactions, 1771, reprinted in J. R. McCulloch, Old and Scarce Tracts on Money, P. S. King & Son, Ltd., London, 1938.

RIDGEWAY, WILLIAM: The Origin of Metallic Currency and Weight Standards, University Press (John Wilson & Son, Inc.), Cambridge, Mass., 1892.

———: Measures and Weights; Money, in Leonard Whibley, A Companion to Greek Studies, University Press (John Wilson & Son, Inc.), Cambridge, Mass., 1905.

———: Measures and Weights; Money, in Sir John Edwin Sandys, A Companion to Latin Studies, University Press (John Wilson & Son, Inc.), Cambridge, Mass., 1910.

ROSTOVTZEEF, M. : The Social and Economic History of the Hellenistic World, 3 vols., Clarendon Press, Oxford University Press, New York, 1941.

———: The Social and Economic History of the Roman Empire, Clarendon Press, Oxford University Press, New York, 1926.

SAMWER, K.: Geschichte des älteren römischen Münzwesens bis ca. 200 v. Chr., Berlin, 1883.

SANDYS, SIR JOHN EDWIN: A Companion to Latin Studies, University Press (John Wilson & Son, Inc.), Cambridge, Mass., 1910.

SMITH, ADAM : An Inquiry into the Nature and Causes of the Wealth of Nations, 2 vols., George Bell & Sons, Ltd., London, 1896.

SOMMERLAD, THEODORE: Mittelalterliches Münzwesen, Handwörterbuch der Staatswissenschaften, Dritte Auflage, 1910, VI, 839-847.

VISSERING, W. On Chinese Currency, E. J. Bell, Leiden, 1877.

WAGEL, SRINIVAS R.: Finance in China, North-China Daily News & Herald, Shanghai, 1914.

WALKER, FRANCIS A.: International Bimetallism, Henry Holt and Company, Inc., New York, 1897.

WEST, LOUIS C: Gold and Silver Coin Standards in the Roman Empire (with Bibliography), Numismatic Notes and Monographs, No. 4, The American Numismatic Society, New York, 1941.

———: Roman Gold Standard and the Ancient Sources, American Journal of Philology, vol. LXII (1941).

WHIBLEY, LEONARD: A Companion to Greek Studies, University Press (John Wilson & Son, Inc.), Cambridge, Mass., 1905.

 

45For a brief discussion of the origin, nature, and definition of money, see Edwin Walter Kemmerer, Money, pp. 3-16.

46Cf. RIDGEWAY, WILLIAM, The Origin of Metallic Currency and Weight Standards, pp. 57-58.

47“If a man have destroyed the eye of a freedman, or have broken the bone of a freedman, he shall pay one mina of silver” (§198). “If a doctor have operated . . . he shall receive ten shekels of silver” (§215). “The wage of an artisan . . . five Sĕ of silver, of a brickmaker . . . five Sĕ.. . . ”(§274).

48Like the names of many other monetary units of later times (i.e., pound, peso, lira), the mina and the shekel were originally concepts of weight. The mina was an ancient Babylonian unit of weight, and shekel (Hebrew, shegal) meant “to weigh” and equaled of a mina.

49obviously, it is impracticable in a book such as this to do more than to touch briefly on the more elementary facts and principles. Where important controversial questions are involved, the best we can do is to follow a highly responsible recent authority and to refer the reader to the selected bibliography at the end of the chapter, in which a number of the principal studies (some of them containing extensive bibliographies) are cited.

50DUBBERSTEIN, W. H., Comparative Prices in Later Babylonia, American Journal of Semitic Languages and Literatures, January, 1939, pp. 20ff.

51RIDGE WAY, op. cit., pp. 204-205.

52Pictures of a number of these very early coins, including one of a gold coin of Croesus, are given by William Atherton DuPuy in The Geography of Money, The National Geographic Magazine, December, 1927, pp. 744-768.

53BURNS, A. R., Money and Monetary Policy in Early Times p. 157.

54For an interesting discussion of the cow unit in different countries and its influence in determining coined units of value, ancient and modern, see Ridgeway, op. cit., pp. 112-115 and 124-154.

55CARLILE, WILLIAM WARRAND, The Evolution of Modern Money, p. 31.

56BURNS, op. cit., p. 160.

57RIDGEWAY, op. cit., p. 339.

58The principle of Gresham’s law appears to have been known in ancient Greece. Aristophanes, writing about 405 B.C., said in Frogs, “In our Republic bad citizens are preferred to good. Just as bad money circulates while good money disappears.” For a brief explanation of Gresham’s law, see pp. 135-136, note.

59Cf. pp. 128-130.

60BULLOCK, CHARLES JESSE, Economic Essays, p. 508.

61ROSTOVTZEEF, M., The Social and Economic History of the Hellenistic World, p. 1291.

62The history of the Roman as is both intriguing and controversial. Concerning it there is a voluminous literature.

63The Roman pound contained 12 ounces and the ounce was divided into 24 scruples. It is usually equated with 5,057 grains Troy. See Louis C. West, Gold and Silver Coin Standards in the Roman Empire, Numismatic Notes and Monographs, No. 4 (1941), pp. 6 and 34.

64RIDGEWAY, in Sir John Edwin Sandys’s A Companion to Latin Studies, p. 441.

65Ibid., p. 447.

66GAIUS PLINIUS SECUNDUS, Historia Naturalis, Bk. XXXIII, 3.13.

67MATTINGLY, HAROLD, Roman Coins, pp. 18 and 27.

68It is interesting to note that our word money has its origin in early Roman times. Money then was coined in a temple of Juno on Capitoline Hill in Rome. One of Juno’s many names was Moneta, a word cognate with Latin monete (to warn). Moneta was guardian of finances (as well as the protector of the female sex). Our words money and mint are cognate with Moneta.

69MATTINGLY, HAROLD, The First Age of Roman Coinage, Journal of Roman Studies, Vol. 19, pp. 20 and 23.

70MATTINGLY, Roman Coins, pp. 5-6.

71 Ibid., p. 24.

72Ibid., p. 17.

73ilver was the principal money of Palestine during the early years of the Christian Era. Gold and bronze coins, however, also circulated there. Christ, for example, directed the twelve disciples, “Provide neither gold, nor silver, nor brass in your purses” (Matt. 10:9). The Greek word for silver is the word translated “money” in the passage “For the love of money is the root of all evil” (I Tim. 6:10). All the references to money that occur in the New Testament have been gathered together by West, op. cit., pp. 47-48.

74BURNS, op. cit., p. 151.

75Ibid.; also, MATTINGLY, Roman Coins, pp. 14 and 24.

76RAPER, MATTHEW, An Inquiry into the Value of the Ancient Greek and Roman Money, in J. R. McCulloch’s Old and Scarce Tracts on Money, p. 552.

The word scruple seems to have been developed from the etymological sense “small pebble.”

77MATTINGLY, Roman Coins, pp. 151-152.

78These gold coins were probably not rated as so many silver denarii, but were bought and sold at market prices. “The aureus of Julius Caesar of ¼ pound . . . is the direct predecessor of the imperial aureus of Augustus, which was tariffed at 25 denarii.”—Mattingly, Roman Coins, p. 25.

79Ibid., p. 18.

80Cf. pp. 135-136, and KEMMERER, Modern Currency Reforms, pp. 329-330.

81MATTINGLY, Roman Coins, pp. 18 and 123.

82Ibid., p. 123. The aureus and the silver denarius, with their respective divisions, were tariffed as follows: 1 aureus (122.9 gr.) = 25 denarii = 100 sestertii = 400 asses. 1 denarius (61.46 gr.) = 4 sestertii = 16 asses.

83ROSTOVTZEEF, M., The Social and Economic History of the Roman Empire, pp. 171-172.

84BURNS, op, cit., p. 154.

85WEST, op. cit., p. 6.

86JACOBS, WILLIAM, An Historical Inquiry into the Production and Consumption of the Precious Metals, vol. I. See, also, Walker, Francis A., Inter’ national Bimetallism, pp. 16-24.

87See p. 29, note; also, RIDGEWAY, in Sandys, op. cit., pp. 451-452.

88The Italian name was fiorino, meaning “flower.” The coin had a lily on one side and on the other the Latin name of the city, Florentia.

• 1For a brief discussion of the origin, nature, and definition of money, see Edwin Walter Kemmerer, Money, pp. 3-16.
• 2Cf. RIDGEWAY, WILLIAM, The Origin of Metallic Currency and Weight Standards, pp. 57-58.
• 3“If a man have destroyed the eye of a freedman, or have broken the bone of a freedman, he shall pay one mina of silver” (§198). “If a doctor have operated . . . he shall receive ten shekels of silver” (§215). “The wage of an artisan . . . five Sĕ of silver, of a brickmaker . . . five Sĕ.. . . ”(§274).
• 4Like the names of many other monetary units of later times (i.e., pound, peso, lira), the mina and the shekel were originally concepts of weight. The mina was an ancient Babylonian unit of weight, and shekel (Hebrew, shegal) meant “to weigh” and equaled of a mina.
• 5obviously, it is impracticable in a book such as this to do more than to touch briefly on the more elementary facts and principles. Where important controversial questions are involved, the best we can do is to follow a highly responsible recent authority and to refer the reader to the selected bibliography at the end of the chapter, in which a number of the principal studies (some of them containing extensive bibliographies) are cited.
• 6DUBBERSTEIN, W. H., Comparative Prices in Later Babylonia, American Journal of Semitic Languages and Literatures, January, 1939, pp. 20ff.
• 7RIDGE WAY, op. cit., pp. 204-205.
• 8Pictures of a number of these very early coins, including one of a gold coin of Croesus, are given by William Atherton DuPuy in The Geography of Money, The National Geographic Magazine, December, 1927, pp. 744-768.
• 9BURNS, A. R., Money and Monetary Policy in Early Times p. 157.
• 10For an interesting discussion of the cow unit in different countries and its influence in determining coined units of value, ancient and modern, see Ridgeway, op. cit., pp. 112-115 and 124-154.
• 11CARLILE, WILLIAM WARRAND, The Evolution of Modern Money, p. 31.
• 12BURNS, op. cit., p. 160.
• 13RIDGEWAY, op. cit., p. 339.
• 14The principle of Gresham’s law appears to have been known in ancient Greece. Aristophanes, writing about 405 B.C., said in Frogs, “In our Republic bad citizens are preferred to good. Just as bad money circulates while good money disappears.” For a brief explanation of Gresham’s law, see pp. 135-136, note.
• 15Cf. pp. 128-130.
• 16BULLOCK, CHARLES JESSE, Economic Essays, p. 508.
• 17ROSTOVTZEEF, M., The Social and Economic History of the Hellenistic World, p. 1291.
• 18The history of the Roman as is both intriguing and controversial. Concerning it there is a voluminous literature.
• 19The Roman pound contained 12 ounces and the ounce was divided into 24 scruples. It is usually equated with 5,057 grains Troy. See Louis C. West, Gold and Silver Coin Standards in the Roman Empire, Numismatic Notes and Monographs, No. 4 (1941), pp. 6 and 34.
• 20RIDGEWAY, in Sir John Edwin Sandys’s A Companion to Latin Studies, p. 441.
• 21Ibid., p. 447.
• 22GAIUS PLINIUS SECUNDUS, Historia Naturalis, Bk. XXXIII, 3.13.
• 23MATTINGLY, HAROLD, Roman Coins, pp. 18 and 27.
• 24It is interesting to note that our word money has its origin in early Roman times. Money then was coined in a temple of Juno on Capitoline Hill in Rome. One of Juno’s many names was Moneta, a word cognate with Latin monete (to warn). Moneta was guardian of finances (as well as the protector of the female sex). Our words money and mint are cognate with Moneta.
• 25MATTINGLY, HAROLD, The First Age of Roman Coinage, Journal of Roman Studies, Vol. 19, pp. 20 and 23.
• 26MATTINGLY, Roman Coins, pp. 5-6.
• 27Ibid., p. 24.
• 28Ibid., p. 17.
• 292Silver was the principal money of Palestine during the early years of the Christian Era. Gold and bronze coins, however, also circulated there. Christ, for example, directed the twelve disciples, “Provide neither gold, nor silver, nor brass in your purses” (Matt. 10:9). The Greek word for silver is the word translated “money” in the passage “For the love of money is the root of all evil” (I Tim. 6:10). All the references to money that occur in the New Testament have been gathered together by West, op. cit., pp. 47-48.
• 30BURNS, op. cit., p. 151.
• 31Ibid.; also, MATTINGLY, Roman Coins, pp. 14 and 24.
• 32RAPER, MATTHEW, An Inquiry into the Value of the Ancient Greek and Roman Money, in J. R. McCulloch’s Old and Scarce Tracts on Money, p. 552.
• 33MATTINGLY, Roman Coins, pp. 151-152.
• 34These gold coins were probably not rated as so many silver denarii, but were bought and sold at market prices. “The aureus of Julius Caesar of ¼ pound . . . is the direct predecessor of the imperial aureus of Augustus, which was tariffed at 25 denarii.”—Mattingly, Roman Coins, p. 25.
• 35Ibid., p. 18.
• 36Cf. pp. 135-136, and KEMMERER, Modern Currency Reforms, pp. 329-330.
• 37MATTINGLY, Roman Coins, pp. 18 and 123.
• 38Ibid., p. 123. The aureus and the silver denarius, with their respective divisions, were tariffed as follows: 1 aureus (122.9 gr.) = 25 denarii = 100 sestertii = 400 asses. 1 denarius (61.46 gr.) = 4 sestertii = 16 asses.
• 39ROSTOVTZEEF, M., The Social and Economic History of the Roman Empire, pp. 171-172.
• 40BURNS, op, cit., p. 154.
• 41WEST, op. cit., p. 6.
• 42JACOBS, WILLIAM, An Historical Inquiry into the Production and Consumption of the Precious Metals, vol. I. See, also, Walker, Francis A., Inter’ national Bimetallism, pp. 16-24.
• 43See p. 29, note; also, RIDGEWAY, in Sandys, op. cit., pp. 451-452.
• 44The Italian name was fiorino, meaning “flower.” The coin had a lily on one side and on the other the Latin name of the city, Florentia.
• 45The gold standard in its “orthodox form” is a product of the nineteenth century. Its roots, however, go deep into the past. This chapter will explore briefly this early history of gold as money, i.e., as a commonly accepted medium of exchange.
• 46Gold, by reason of its beauty, its world-wide distribution, the facility with which it could be obtained from the streams by crude methods of “panning,” and the ease with which it could be “worked,” probably had a wider use as a medium of exchange in very ancient times, and among primitive peoples in modern times, than any other metal.
• 47The earliest references I have been able to find in recorded history to the use of one of the precious metals as a medium of exchange—in these cases, passing by weight—are in the Code of Hammurabi, King of Babylon. They refer to silver in about the year 1870 B.C.
• 48The earliest references I have been able to find in recorded history to the use of one of the precious metals as a medium of exchange—in these cases, passing by weight—are in the Code of Hammurabi, King of Babylon. They refer to silver in about the year 1870 B.C.
• 49Thanks to the careful studies made by classical scholars over many generations, we know today much more about the money of classical times than the ancients knew. There are, however, many gaps in the chronology of the coins that have come down to us, and the story that these coins tell is far from complete. It is still full of controversial questions concerning which the modern literature is voluminous, but progress in their solution is being, made continually.
• 50Coinage was originally of the nature of a seal or hallmark punched on a nugget of metal as a guarantee of its quality or its weight. The beginnings of coinage appear to have been made in the countries of the eastern Mediterranean early in the eighth century B.C. Sennacherib, King of Assyria (705-681 B.C.), said, “I built a form of clay and poured bronze into it as in making half-shekel pieces.”
• 51Many of the early coins were made of electrum—a natural alloy, consisting of about three parts of gold to one part of silver, which was found abundantly in Lydia and which caused that country to be known as the land of gold. Because of the difficulty in separating the gold from the silver, the ancients regarded electrum almost as a distinct metal. Early coins of pure gold in Asia Minor were probably made from placer gold obtained from the valley of the Oxus or from the Ural Mountains. The electrum coins were ancient examples of what in modern times is called symmetallism.
• 52I have in my possession a gold daric, one of the oldest and most famous gold coins in history. It is made of almost pure gold and is about the weight of our late American $5 gold piece. It looks like a roughly molded gold nugget and bears a crude stamp of an archer with his bow and spear. The coin was made during the reign of Darius the Great of Persia, about 500 years before Christ. Only about two generations before this, in the reign of Croesus, which began 561 B.C., there circulated in Asia Minor the coins of which Herodotus said, “The Lydians were the first people, so far as I know, to adopt a gold and silver coinage.”
• 53In those early times, gold coins and silver coins circulated for several centuries under a dual standard. Gold gained in importance at the time of Alexander the Great, under the stimulus furnished by the large amount of gold produced in his Pangean mines.
• 54In Homeric times values in Greece were reckoned in terms of the cow. According to Ridgeway, “. . . weighing was first invented for traffic in gold, and since the weight-unit of gold is found regularly to be the value of a cow or ox . . . the unit of weight is ultimately derived from the value in gold of a cow.” Our English word pecuniary, which is derived from the Latin pecus, meaning “cattle,” is a monument to this development. Copper was early used as money. The first oboi was apparently a copper spike or skewer, six of which made a drachma, meaning “handful.”
• 55In Homeric times values in Greece were reckoned in terms of the cow. According to Ridgeway, “. . . weighing was first invented for traffic in gold, and since the weight-unit of gold is found regularly to be the value of a cow or ox . . . the unit of weight is ultimately derived from the value in gold of a cow.” Our English word pecuniary, which is derived from the Latin pecus, meaning “cattle,” is a monument to this development. Copper was early used as money. The first oboi was apparently a copper spike or skewer, six of which made a drachma, meaning “handful.”
• 56The first gold coin to circulate in Hellas proper was the aforementioned Persian daric or stater (meaning “to weigh”), which weighed about 130 grains and which enjoyed an extensive circulation for several centuries. It was never debased and was “practically the only gold coin for about 200 years, as well in Asia Minor and the mainland of Greece as in the Persian Empire.” It was known in Palestine during Biblical times.
• 57Early in the fourth century B.C., the silver coinage of Rhodes was supplemented by an issue of gold staters, and this double issue of gold and silver continued unbroken until after the death of Alexander the Great in 323 B.C.
• 58In the Greek world there were, on occasions, official ratings of the coins of one metal in terms of those of the others. Ratings were changed from time to time and recoinages were made, to prevent a cheaper or overrated metal from driving out of circulation a dearer or underrated one, under the force of what we now call Gresham’s law.
• 59About the beginning of the fourth century B.C., we find a case of monetary debasement suggestive of our American debasement of 1933 to 1934. Dionysius, Tyrant of Syracuse, who had borrowed heavily from his citizens and was being hard pressed for repayment, directed that all the coins in the city should be brought to him, under penalty of death. He then restamped the coins and gave to each drachma the value of two drachmas. By this debasement he was enabled to pay off the original loan and, at the same time, repay the money that he had ordered to be brought to the mint.
• 60About the beginning of the fourth century B.C., we find a case of monetary debasement suggestive of our American debasement of 1933 to 1934. Dionysius, Tyrant of Syracuse, who had borrowed heavily from his citizens and was being hard pressed for repayment, directed that all the coins in the city should be brought to him, under penalty of death. He then restamped the coins and gave to each drachma the value of two drachmas. By this debasement he was enabled to pay off the original loan and, at the same time, repay the money that he had ordered to be brought to the mint.
• 61Shortly after the death of Alexander, the unified Attic monetary system, which prevailed throughout most of his empire, began to disintegrate. Concerning what followed, down to the time of the conquest of the Greek world by the Romans, M. Rostovtzeef says : [Alexander’s] successors continued his coinage but each for himself in his own name: Coinage was one of the signs and symbols of political independence, it was a powerful instrument of political influence and propaganda, and it yielded a substantial revenue. With the further disintegration of his empire, coinage became ever more diversified, each sovereign State, whether a monarchy or a city, minting its own money.
• 62Bronze Money. In Italy, as elsewhere, one of the first forms of metallic money consisted of unstamped bullion. But here, unlike the situation in some other places, where gold was readily available, the first metal to circulate was bronze. Originally, the bronze circulated in the form of a rough lump (aes rude), the lumps varying in weight, shape, and size, and bearing no stamp. Later it was hammered into the form of a bar, known as an as (meaning “unit”) in order to give it a convenient form for bartering the metal, which was in demand for the making of tools, weapons, and utensils. As time went on, the conventional length of this bar became a foot (the length of a man’s foot), which, with the conventional diameter, gave the bar a convenient weight of about 1 pound. The bar was later marked off into 12 thumbs, or inches. Since these bars (asses) varied considerably in weight, the custom gradually developed of passing them by weight instead of by tale. The weight of metal then became the important consideration, and the unit of value became the pound of bronze, the as libralis, while the 12 thumb divisions, or inches, became 12 ounces.
• 63Bronze Money. In Italy, as elsewhere, one of the first forms of metallic money consisted of unstamped bullion. But here, unlike the situation in some other places, where gold was readily available, the first metal to circulate was bronze. Originally, the bronze circulated in the form of a rough lump (aes rude), the lumps varying in weight, shape, and size, and bearing no stamp. Later it was hammered into the form of a bar, known as an as (meaning “unit”) in order to give it a convenient form for bartering the metal, which was in demand for the making of tools, weapons, and utensils. As time went on, the conventional length of this bar became a foot (the length of a man’s foot), which, with the conventional diameter, gave the bar a convenient weight of about 1 pound. The bar was later marked off into 12 thumbs, or inches. Since these bars (asses) varied considerably in weight, the custom gradually developed of passing them by weight instead of by tale. The weight of metal then became the important consideration, and the unit of value became the pound of bronze, the as libralis, while the 12 thumb divisions, or inches, became 12 ounces.
• 64Bronze Money. In Italy, as elsewhere, one of the first forms of metallic money consisted of unstamped bullion. But here, unlike the situation in some other places, where gold was readily available, the first metal to circulate was bronze. Originally, the bronze circulated in the form of a rough lump (aes rude), the lumps varying in weight, shape, and size, and bearing no stamp. Later it was hammered into the form of a bar, known as an as (meaning “unit”) in order to give it a convenient form for bartering the metal, which was in demand for the making of tools, weapons, and utensils. As time went on, the conventional length of this bar became a foot (the length of a man’s foot), which, with the conventional diameter, gave the bar a convenient weight of about 1 pound. The bar was later marked off into 12 thumbs, or inches. Since these bars (asses) varied considerably in weight, the custom gradually developed of passing them by weight instead of by tale. The weight of metal then became the important consideration, and the unit of value became the pound of bronze, the as libralis, while the 12 thumb divisions, or inches, became 12 ounces.
• 65Summing up this development, Ridgeway says:
• 66Weighing bronze was, however, inconvenient, and the practice developed toward the close of the regal period of placing upon the asses an authoritative stamp certifying their weight, so that again they could pass by count. There are early records of 2-pound bars and also of bars of ½ and ¼ pound. The earliest coin marks on the bars that we have preserved are crude drawings of animals. According to Pliny, “King Servius first stamped bronze.. . . It was stamped with the impressions of animals, whence it was termed pecunia ...”
• 67The as of bronze, which developed as a commodity-money unit of value very early in Roman history and was first coined about 300 B.C., played an important part in that history for centuries. According to Mattingly, “The bronze coinage was paramount from the beginnings down to c. 245 B.C.. . . ”While from 245 B.C. to 217 B.C. it played an equally important part with silver, after 217 B.C. silver dominated, and during the second century the bronze coinage became increasingly subsidiary.
• 68Long after the as libralis ceased to circulate, it was used as a unit of account, in terms of which people thought and expressed monetary values even when payments were actually made in the standard silver money. In contracts then it appears to have been called the as grave, to distinguish it from the current as.
• 69Silver Money. Silver in the form of ingots and of foreign coins, notably those of the Greeks, Etruscans, and Sicilians, circulated in Italy during part of the bronze-standard period just described. According to Mattingly, the aes grave of Rome and Italy, which we have previously mentioned, represented “only a short stage of transition from the early use of uncoined bronze as a measure of value, to the Greek use of silver money . . . ” Rome, learning the use of silver and of token bronze from the Greeks of southern Italy, was led to give at least the form of a coinage to the bronze that she was accustomed to use for trading with the Italian peoples.
• 70It was inevitable that this clumsy coinage should soon give way to the more convenient silver. Accordingly, during the course of the Pyrrhic War, Rome struck her first silver coins, didrachmas (double drachmas) and rare divisions of the didrachma. After defeating Pyrrhus and getting control of all southern Italy, shortly before the First Punic War, the Romans obtained there large supplies of silver, which they used in part for the Roman silver coin that was struck in Campania. This coin was the denarius (meaning “every ten”), and was probably equivalent to a didrachma. It was rated at 10 asses and divided into four parts, called sestertii. Although this silver coinage in Rome itself was struck about 268 B.C., it was not until about a half century later that silver became the dominant standard and the sestertius replaced the as as the unit of reckoning.
• 71It was inevitable that this clumsy coinage should soon give way to the more convenient silver. Accordingly, during the course of the Pyrrhic War, Rome struck her first silver coins, didrachmas (double drachmas) and rare divisions of the didrachma. After defeating Pyrrhus and getting control of all southern Italy, shortly before the First Punic War, the Romans obtained there large supplies of silver, which they used in part for the Roman silver coin that was struck in Campania. This coin was the denarius (meaning “every ten”), and was probably equivalent to a didrachma. It was rated at 10 asses and divided into four parts, called sestertii. Although this silver coinage in Rome itself was struck about 268 B.C., it was not until about a half century later that silver became the dominant standard and the sestertius replaced the as as the unit of reckoning.
• 72In the year 217 B.C. the as was reduced to a standard of 1 ounce and was retariffed at the rate of 16 instead of 10 to the denarius, while the denarius itself was debased. About the beginning of the second century B.C., “the Roman coinage enters on a long period of quiet and orderly movement with little of external change to mark it.” This situation continued during the early centuries of the Empire, during which, however, silver met increasing competition from gold. The yellow metal finally superseded silver as the dominant standard, just as silver had previously superseded bronze. To this story we shall now turn.
• 73In the year 217 B.C. the as was reduced to a standard of 1 ounce and was retariffed at the rate of 16 instead of 10 to the denarius, while the denarius itself was debased. About the beginning of the second century B.C., “the Roman coinage enters on a long period of quiet and orderly movement with little of external change to mark it.” This situation continued during the early centuries of the Empire, during which, however, silver met increasing competition from gold. The yellow metal finally superseded silver as the dominant standard, just as silver had previously superseded bronze. To this story we shall now turn.
• 74Contemporaneously with the circulation of bronze and silver in Rome and other Italian cities during early times, there was a circulation by weight of gold in the form of nuggets and of foreign coins. This gold was used principally in the larger transactions. Although destined ultimately to supplant both bronze and silver as the basic monetary metal, gold was in this territory the least important of the three, prior to the beginning of the Christian Era. Evidence that there was a substantial circulation of gold as early as the fourth century B.C. is found in the fact that there was a law at that time requiring that a certain tax be paid in gold.
• 75Under the financial strain of the Second Punic War (218-201 B.C.), Rome for the first time minted gold coins. They were minted out of gold bullion taken from her treasury. The weights of these coins were based on the scruple, which was one twenty-fourth of the old Roman ounce and equaled 17½ grains. There were coins, of one, two, and three scruples, respectively, with the approximate weights that would correspond to $1, $2, and $3 of United States gold coin prior to 1933. The Romans officially rated these gold pieces in terms of silver at a rate of 20 sestertii to a scruple of gold, a rating so high that apparently the gold coins were treated as tokens. The issue was short-lived.
• 76Under the financial strain of the Second Punic War (218-201 B.C.), Rome for the first time minted gold coins. They were minted out of gold bullion taken from her treasury. The weights of these coins were based on the scruple, which was one twenty-fourth of the old Roman ounce and equaled 17½ grains. There were coins, of one, two, and three scruples, respectively, with the approximate weights that would correspond to $1, $2, and $3 of United States gold coin prior to 1933. The Romans officially rated these gold pieces in terms of silver at a rate of 20 sestertii to a scruple of gold, a rating so high that apparently the gold coins were treated as tokens. The issue was short-lived.
• 77Under the financial strain of the Second Punic War (218-201 B.C.), Rome for the first time minted gold coins. They were minted out of gold bullion taken from her treasury. The weights of these coins were based on the scruple, which was one twenty-fourth of the old Roman ounce and equaled 17½ grains. There were coins, of one, two, and three scruples, respectively, with the approximate weights that would correspond to $1, $2, and $3 of United States gold coin prior to 1933. The Romans officially rated these gold pieces in terms of silver at a rate of 20 sestertii to a scruple of gold, a rating so high that apparently the gold coins were treated as tokens. The issue was short-lived.
• 78No further gold coins were minted by Rome for over a century and a half, until the time of the Roman conquests under the great generals Sulla, Pompey, and Julius Caesar. These generals in the field issued the gold coins under authority of the government at Rome. Much of the metal for making them came to the generals in the form of loot, and many of the coins in turn probably went to the soldiers as rewards. Sulla coined an aureus (meaning gold) of 168 grains and later one of 140 grains. Pompey continued coining it at 140 grains. Julius Caesar reduced it to 126 grains. After his death the Senate authorized the ordinary moneyers to coin gold, but coining at Rome was soon superseded by the provincial issues of the triumvirs and their subordinates.
• 79No further gold coins were minted by Rome for over a century and a half, until the time of the Roman conquests under the great generals Sulla, Pompey, and Julius Caesar. These generals in the field issued the gold coins under authority of the government at Rome. Much of the metal for making them came to the generals in the form of loot, and many of the coins in turn probably went to the soldiers as rewards. Sulla coined an aureus (meaning gold) of 168 grains and later one of 140 grains. Pompey continued coining it at 140 grains. Julius Caesar reduced it to 126 grains. After his death the Senate authorized the ordinary moneyers to coin gold, but coining at Rome was soon superseded by the provincial issues of the triumvirs and their subordinates.
• 80When, as a result of debasements, coins of different weights were in circulation together in sufficient quantities, Gresham’s law operated, and the lighter weight coins drove the heavier ones out of circulation. A person who could discharge a debt with the same number of lightweight aurei as of heavyweight ones, naturally paid it with the lightweight ones and kept or melted down the heavier ones. Likewise, when the market prices of commodities were the same whether payments were made in lightweight coins or in heavyweight ones, the purchaser would pay with the lightweight ones. It was merely a case of buying in the cheaper market. To the extent that the merchants and others in selling goods made allowance for the differences in the weight of the coins by quoting lower prices when payment was to be made in the heavier coins, a dual standard developed and standard coins of different weights then circulated side by side.
• 81Augustus gave gold a place above silver. He reduced the aureus from the 126-grains weight given it by Julius Caesar to 122.9 grains. “Gold and silver are both struck almost pure [at a ratio of 12½ to 1]. . . . Brass and copper are struck much more carelessly . . . , i.e., not on ä carefully adjusted weight for each piece, but at so many to the pound.” From Augustus to Nero the system was not changed, but the weight of the aureus was gradually reduced administratively, with an accompanyng reduction in the denarius. From the reign of Nero through the reign of Diocletian, the monetary situation throughout the Empire was confused and debasements were common. The reigns of Claudius and Nero witnessed much counterfeiting and a wide circulation of privately made tokens, which were usually of lead. Diocletian made two reductions in the weight of the aureus in the year 312, and Constantine the Great put through a monetary reform that fixed the gold content of the aureus at about 70 grains, representing a debasement of approximately 38 per cent since the time of Nero. Thereafter, until the Empire in the West came to its end in 476, gold apparently grew in relative importance and was the imperial money par excellence, although the silver denarius and its fractions continued to hold a high place in the business of the Empire.
• 82Augustus gave gold a place above silver. He reduced the aureus from the 126-grains weight given it by Julius Caesar to 122.9 grains. “Gold and silver are both struck almost pure [at a ratio of 12½ to 1]. . . . Brass and copper are struck much more carelessly . . . , i.e., not on ä carefully adjusted weight for each piece, but at so many to the pound.” From Augustus to Nero the system was not changed, but the weight of the aureus was gradually reduced administratively, with an accompanyng reduction in the denarius. From the reign of Nero through the reign of Diocletian, the monetary situation throughout the Empire was confused and debasements were common. The reigns of Claudius and Nero witnessed much counterfeiting and a wide circulation of privately made tokens, which were usually of lead. Diocletian made two reductions in the weight of the aureus in the year 312, and Constantine the Great put through a monetary reform that fixed the gold content of the aureus at about 70 grains, representing a debasement of approximately 38 per cent since the time of Nero. Thereafter, until the Empire in the West came to its end in 476, gold apparently grew in relative importance and was the imperial money par excellence, although the silver denarius and its fractions continued to hold a high place in the business of the Empire.
• 83Augustus gave gold a place above silver. He reduced the aureus from the 126-grains weight given it by Julius Caesar to 122.9 grains. “Gold and silver are both struck almost pure [at a ratio of 12½ to 1]. . . . Brass and copper are struck much more carelessly . . . , i.e., not on ä carefully adjusted weight for each piece, but at so many to the pound.” From Augustus to Nero the system was not changed, but the weight of the aureus was gradually reduced administratively, with an accompanyng reduction in the denarius. From the reign of Nero through the reign of Diocletian, the monetary situation throughout the Empire was confused and debasements were common. The reigns of Claudius and Nero witnessed much counterfeiting and a wide circulation of privately made tokens, which were usually of lead. Diocletian made two reductions in the weight of the aureus in the year 312, and Constantine the Great put through a monetary reform that fixed the gold content of the aureus at about 70 grains, representing a debasement of approximately 38 per cent since the time of Nero. Thereafter, until the Empire in the West came to its end in 476, gold apparently grew in relative importance and was the imperial money par excellence, although the silver denarius and its fractions continued to hold a high place in the business of the Empire.
• 84Augustus gave gold a place above silver. He reduced the aureus from the 126-grains weight given it by Julius Caesar to 122.9 grains. “Gold and silver are both struck almost pure [at a ratio of 12½ to 1]. . . . Brass and copper are struck much more carelessly . . . , i.e., not on ä carefully adjusted weight for each piece, but at so many to the pound.” From Augustus to Nero the system was not changed, but the weight of the aureus was gradually reduced administratively, with an accompanyng reduction in the denarius. From the reign of Nero through the reign of Diocletian, the monetary situation throughout the Empire was confused and debasements were common. The reigns of Claudius and Nero witnessed much counterfeiting and a wide circulation of privately made tokens, which were usually of lead. Diocletian made two reductions in the weight of the aureus in the year 312, and Constantine the Great put through a monetary reform that fixed the gold content of the aureus at about 70 grains, representing a debasement of approximately 38 per cent since the time of Nero. Thereafter, until the Empire in the West came to its end in 476, gold apparently grew in relative importance and was the imperial money par excellence, although the silver denarius and its fractions continued to hold a high place in the business of the Empire.
• 85Augustus gave gold a place above silver. He reduced the aureus from the 126-grains weight given it by Julius Caesar to 122.9 grains. “Gold and silver are both struck almost pure [at a ratio of 12½ to 1]. . . . Brass and copper are struck much more carelessly . . . , i.e., not on ä carefully adjusted weight for each piece, but at so many to the pound.” From Augustus to Nero the system was not changed, but the weight of the aureus was gradually reduced administratively, with an accompanyng reduction in the denarius. From the reign of Nero through the reign of Diocletian, the monetary situation throughout the Empire was confused and debasements were common. The reigns of Claudius and Nero witnessed much counterfeiting and a wide circulation of privately made tokens, which were usually of lead. Diocletian made two reductions in the weight of the aureus in the year 312, and Constantine the Great put through a monetary reform that fixed the gold content of the aureus at about 70 grains, representing a debasement of approximately 38 per cent since the time of Nero. Thereafter, until the Empire in the West came to its end in 476, gold apparently grew in relative importance and was the imperial money par excellence, although the silver denarius and its fractions continued to hold a high place in the business of the Empire.
• 86The third factor was that the supply of the precious metals available for money declined in a large part of Europe during the Dark Ages. Widespread looting of occupied territories during the wars of the early Christian Era and subsequently by the conquering Germanic peoples of the North had scattered widely and thinly the accumulated gold and silver treasure of classical times. The yields of the gold and silver mines also declined, partly because the mines were bled white by tenant operators who were little concerned with the conservation of the mines’ resources, partly because most of the labor in the mines was inefficient convict and slave labor, and partly because there was destruction and looting of the mines by the invading barbarians.
• 87Coinage in Europe during the early Middle Ages was practically limited to silver and copper, except for a temporary minting of gold in the Carolingian period. Silver provided the principal currency of western Europe. The aureus of Constantine, however, continued to circulate until the downfall of the Eastern Empire in 1453, and from this gold unit various coinages of mediaeval and modern Europe were descended.
• 88In the year 1252, in response to a growing demand for coins of a larger value, particularly for the foreign trade of the great Italian cities, gold coins containing 48 grains of fine gold were struck in Florence. These became the famous gold florins of Italy. Similar gold coins were later minted in Germany and France, and in other cities of Italy—notably, the Venetian zecchino, which had a large circulation extending even to Turkey.