This past week my wife and I have been traveling around the world and learning a lot about the cultures and economies of the countries we are visiting. One of the things we’ve found surprising is the varying exchange rates of the U.S. dollar to the local currency in each country we visit. In Hong Kong one U.S. dollar was equal to almost eight Hong Kong dollars. In Malaysia one U.S. dollar was equal to about four and a half Malaysian ringgit. And in the Maldives one U.S. dollar is equal to about fifteen and a half Maldivian rufiyaa. As you can imagine, it has been difficult at times ensure we’re paying a reasonable amount for whatever food, goods, or services we have been purchasing at the time. In light of many of the interesting facts we’ve learned about money worldwide in the last week, here are some interesting facts about money in the U.S.
1. U.S. law requires Presidents to be deceased for at least two years before they are eligible to be featured on a U.S minted coin. The tradition and reasoning dates back to the Revolutionary War era. One way for a king to proclaim his rule over his territory was to have his image struck into the coins that were used across his kingdom. The American colonists were predominantly anti-royalists, and the image of the British king on coins they were forced to use in everyday transactions was a painful reminder of what they considered his tyranny and oppression.
When the first U.S. dollar coin was ready to be made, George Washington actually declined the request to allow his portrait on the coin. Washington didn’t want any hint of royal rule to creep into the new democratic government. Washington’s refusal set a precedent for all future U.S. Presidents. It was not until 1909 that the first deceased president, Abraham Lincoln, appeared on any U.S. coin. And that first Lincoln coin is still used today, we all know it as the penny.
2. Originally, the penny was made of pure 100% copper but now contains just 2.5% copper. From the early 1900s to now, pennies have been made from all sorts of different metals including copper, bronze, steel, and even aluminum. The composition of the penny was most recently changed in 1982. The penny is now made of 97.5 percent zinc with the remaining 2.5 percent coming from a copper coating. So now we have copper-plated zinc pennies.
3. The cost to make a penny fluctuates every year based on the cost of the raw materials. In 2011, the cost to manufacture a penny reached an all-time high with each penny costing about 2.41 cents to make.
4. The U.S. Department of the Treasury first issued paper U.S. currency in 1862. Prior to this, only coins were used for currency. The decision was made to issue paper currency to help finance the Civil War because of a shortage of coins. There was a shortage of coins because people had started hoarding them. There was a lot of uncertainty caused by the war and this drove extreme price fluctuations of everyday items. At the time, coins were made of gold and silver and their value didn’t change much, so people wanted to hang onto them rather than buy items that might lose their value.
5. The color green was chosen for the U.S. bills because it was more difficult to counterfeit than the standard black printing. Also, the green ink is more resistant to fading and discoloration than many other colors. Furthermore, in the 1920s when green was instituted as the standard color, there was an abundant supply of green ink readily available.
6. Zero trees are cut down to make U.S. “paper” currency. Dollar bills are actually fabric and not the typical paper like newspapers and books. Paper is primarily made of wood pulp. The fabric for U.S. “paper” currency is actually made of 75% cotton and 25% linen.
7. An average $1 dollar bill only lasts about 18 months before it is worn out and taken out of circulation. The $5 bill lasts two years. The $10 bill lasts three years. The $20 bill lasts four years. The $50 and $100 bills last about nine years.
8. Only 3% of U.S. currency is still in old-fashioned paper cash that you can touch. The rest is all used, tracked, and even created digitally.
9. There are two persons on current U.S. bills that were not U.S. Presidents.
10. The U.S. used to have a $100,000 bill. While the $100,000 bill is still considered legal tender it has not been seen in circulation since the 1960s. Also, this bill was never publicly circulated. It was only used for transactions between Federal Reserve banks from the 1930s to the 1960s. As technology improved, the arrival of wire transfers made these large bills obsolete and impractical.
What other interesting money facts have you heard or read about?