Dollar

1 Few Americans understand what the word "dollar" means even though it is a word that most of us use every day.

2 Perhaps we mistakenly think that not being aware of the exact concepts behind words has little impact on our ability to enjoy a happy and productive life.

3 Conversely, a poor understanding of important words may entice us to make bad decisions.

4 Not only is “dollar” a very important word, but our misunderstanding of the meaning of this very important word has caused us much misery and grief.

5 JOACHIMSTHALERS

6 Around 1520 A.D., a wealthy German Count named Stephen Von Schlick lived in an area of Germany called Joachim’s Thal (pronounced “tall”; silent “h”). Thal is German for “valley.”

7 Because an ancient silver mine was on his property, Von Schlick built a Mint, and for about nine years manufactured silver coins in Joachim’s Tall, or Valley.

8 Although Von Schlick’s coins had other names in their earliest existence, within a few years after their first issue they were most widely known as joachims-thalers, meaning “coins which come from Joachim’s Thal”.

9 After a few more years, the adjective “joachims” was discarded, resulting in the coins being called thalers (tallers).

10 REGULATION & VALUE

11 Thalers (tallers) circulated widely because tradesmen had faith in Von Schlick’s high ethical standards.

12 Von Schlick insisted from the start that his coins would be 90% silver and 10% alloy.

13 More importantly, his strict policy was that coins which deviated more than 5% in weight were tossed into a scrap-bin and later remelted to make new coins.

14 Establishing tolerances on the metal content and overall weight of a coin is called “regulating the value” of the coin.

15 We can understand this concept clearly if we remember that “val” is Latin for “worth”.

16 In “regulating the value” of a coin we assure close conformity between the weight stated on the face of the coin and what the coin actually weighs.

17 By establishing strict tolerances of silver content and overall weight, Von Schlick regulated the value, or worth, of each of his coins and therefore regulated the truthfulness of the marks on the faces of the coins.

18 NEW DESIGNS & NEW NAMES

19 As thalers (tallers) spread across Europe they acquired new names.

20 For example, the Dutch called them dallers or daalders. When the Dutch later began making their own silver coins of identical weight, they named their coins dallers as well.

21 Spanish Officials, while having great respect for thalers (tallers), recognized one fault: their smooth sides.

22 From time to time, unscrupulous persons would clip, grind or file a thin layer off the sides of coins, an action called “clipping.”

23 Thalers (tallers) were manufactured with smooth sides, so evidence of clipping was almost undetectable.

24 Clippings would be made into new coins, and the clipped coins would be spent in the market place as if they were of full weight.

25 The Coin clippers were therefore committing theft by fraud.

26 Spain decided to produce a better coin, one almost identical to the thaler (taller) in silver content and overall weight, but with a Spanish design having mill-marks on the sides to discourage clipping.

27 The new Spanish coin was officially called a colonata but when they began to circulate where the thalers also circulated, they shortly became known as dallers too, or doleras.

28 And the colonata’s mill-marks gave rise to still another nickname: the Spanish milled dollar.

29 Pilgrims who settled in North America in the middle 1600s carried these Spanish coins with them, calling them either Spanish milled dollars or pieces of eight.

30 The latter phrase came into use because the colonata was divided into eight parts called reales, pronounced “ray-all-es,” much like our current dollar is divided into 100 cents.

31 Yankee settlers were disinclined to use the reales. Instead of four reales for half a dollar they often used the term “four bits” — “two bits” was often used instead of two reales or a quarter dollar, expressions which have endured to this day.

32 LAWFUL MONEY OF THE UNITED STATES

33 On April 2, 1792, five years after the United States Constitution was signed, Congress passed our first coinage Act (hereinafter called “The Act”).

34 The Act created the United States Mint where our official money — silver and gold coins — was to be manufactured and regulated as United States Coins.

35 The Act established the dollar as the unit of money in the United States, declared it to be lawful tender, and established the decimal system for the currency of the United States.

35 Money manufactured according to law is called lawful money and the phrase “lawful money of the United States” means silver or gold coins that have been manufactured according to public law in a United States Mint.

36 May the grace of our Lord Jesus Christ be with you all. Amen.