When the English colonists arrived in America they naturally continued to use
the monetary units of Britain, the pound, shilling, and pence, for which £1
equaled 20 shillings or s, and 1s equaled 12 pence or d. Toward this end
Parliament enacted laws prohibiting the export of silver coinage: it was felt the
colonies should be providing Britain with precious metals rather than draining
them away. The result of this policy was that British silver coins were quite
scarce in the colonies.
The silver shortage forced the colonist merchants and consumers to turn to
foreign coins, primarily Spanish American silver produced in Mexico and Peru.
The most widely used coin in the colonies was the eight reales (piece of eight),
primarily clipped underweight examples that had made their way north from
Mexico through the Bahamas. The eight reales was the highest unit of Spanish
silver in the New World, similar in size and weight to the thalers of the various
German states, the French écu, the Portuguese cruzado and the ducatoon of
Holland; colonists called the eight reales coin a "dollar," from the Dutch
"daalder" (a derivative of the German thaler).
Eventually each colony had its own paper money with exchange rates for
British Pound Sterling rates and commodities equivalencies proclaimed by
Queen Anne, thus the term proclamation money. In deeds and documents of
the era the following currency abbreviations appear: pm= proclamation
money, cm = current money, d= pence s= shilling GB=Great Britain.
North Carolina proclamation money crown note- twenty shillings 1754.
Image source UNC Chapel Hill Library. In the image above note the crown image lower left. Picture clues were added to paper money to
assist colonists, servants and slaves who could not read.
Efforts to Control Trade: Mercantilism
The amount of gold in the world
is essentially fixed
A nation increases its power by
increasing its stockpiles of gold-
Gold is increased by minimizing
imports (buying) and maximizing
Colonies supply raw materials
without sending gold to a foreign
country & buy English products
Early Colonial Mercantilist Policies to
1. Navigation Acts of 1650—
all trade to be conducted on
English (or American)
2. Navigation Acts of 1660—
Ship crews had to be ¾
English (or American)
certain products (tobacco,
sugar, etc.) could only be
shipped to England
3. Navigation Acts of 1663—
Certain goods that were
being shipped to the
colonies from other
countries had to be
shipped to England first.
4. Navigation Acts accepted in
theory (English had a right
to pass them) but defied in
practice (smuggling) by the
5. Efforts to stop smuggling
would lead to problems.