North Carolina Colonial Paper Money
A Brief Description
Introduction
Money in the Colonies
England's mercantilist economic policy, which reached its height in the 17th and 18th centuries, required a balance of trade with hard money--coins of copper, silver, and gold--flowing to the mother country. Private coinage in the colonies was prohibited, although the Pine Tree Shilling and its variants defied that restriction. Foreign coins did circulate, but their supply was never ample. Coins of several countries mingled with contemporary counterfeits, creating a confused and treacherous monetary disorder that we can hardly imagine today. What specie was available in the colonies was used to buy goods from England and elsewhere. The colonial government tried to set some standards. For example, in 1715 the North Carolina Assembly set the value of the Lion Dollar, a Dutch coin more common to New York than to the Carolinas, in terms of a known commodity: "...and It Is Hereby Enacted that all Lyon Dollars shall pass Current in all payments within this Province and be Deemed Equal to three bushalls of Indyan Corn and so proportionally for any other of the Rated Comoditys" (Colonial Records of North Carolina, Laws of 1715)*.
The colonists did not like money of no intrinsic value, but the scarcity of coins necessitated its use. And it did circulate. Many well-worn and carefully repaired colonial notes survive in collectors' hands to attest to hard service to the colonies and later the new states.
Paper in the Colonies
All of the colonies that were to form the United States issued paper money. Massachusetts was first in 1690. North Carolina authorized its first paper money in 1712 and issued it in 1713, making the Old North State the eighth colony to resort to the necessary but disliked form of money.
Paper money was considered better than no means of exchange, and North Carolina, like the other colonies, relied on a paper money economy for most of the 18th century. The paper money habit continued into early statehood, ending with the issues emanating from 1785 legislation. The State did not issue more paper money, with the exception of a few issues in the 1814-1824 period, until the proliferation of treasury notes during the Civil War. After the colonial period, state and federal governments generally shied away from paper money until the feds began in earnest to print paper money during the Civil War. By then there was no turning back to a hard money-only economy.
Issues of North Carolina colonial paper money are identified by the legislation that enabled them. Usually, but not always, there is reference in the text on the note to that legislation, including a passage or legislative session date. There are 25 different issues, each with several denominations. This introduction divides the issues into seven logical groupings.
The short articles that comprise this web site provide a description of North Carolina's paper money from a collector's view. They try to interpret what the objects tell us about North Carolina and its money during their period of use. What does the paper money inform us about the times? What promises were made, and what evidence is there of the success of the money? Details about the legislative actions and the contemporary economic conditions are topics left to much more scholarly and historical treatments. The note examples are almost all from the author's collection.
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*Thanks to Paul Horner and Jerry Roughton, who published this in their North Carolina Numismatic Scrapbook, “The Lyon Dollar of Holland – 'the most common foreign coin seen in Carolina'", volume I, no. 12, Summer 2004.