United States dollar: Difference between revisions

| image_title_1 = [[Federal Reserve Note|Federal Reserve Notes]]s (obverse)

| image_2 =  

| rarely_used_banknotes = [[United States two-dollar bill|$2]] (still printed); [[Large denominations of United States currencyfive-hundred-dollar bill|$500]], [[Large denominations of United States currencyone-thousand-dollar bill|$1,000]], [[Large denominations of United States currencyfive-thousand-dollar bill|$5,000]], [[Large denominations of United States currencyten-thousand-dollar bill|$10,000]] (discontinued, but still legal tender); [[United States one -hundred-thousand-dollar bill|$100,000]] (discontinued, not legal tender, and only used for specific purposes)

| inflation_rate = 2.96% or 2.51%

| inflation_source_date = [https://www.bls.gov/news.release/cpi.nr0.htm BLS] (JulyOctober 2024) or [https://www.bea.gov/data/personal-consumption-expenditures-price-index BEA] (JuneSeptember 2024)

The [[monetary policy of the United States]] is conducted by the [[Federal Reserve System]], which acts as the nation's [[central bank]]. As of February 10, 2021, currency in circulation amounted to {{US$|2.10 [[trillion]]}}, {{US$|2.05 trillion|long=no}} of which is in Federal Reserve Notes (the remaining {{US$|50 billion|long=no}} is in the form of [[Coins of the United States dollar|coins]] and older-style [[United States Note]]s).<ref>{{cite web|title=How much U.S. currency is in circulation?|url=https://www.federalreserve.gov/faqs/currency_12773.htm|access-date=February 27, 2021|publisher=Federal Reserve|archive-date=November 13, 2021|archive-url=https://web.archive.org/web/20211113151222/https://www.federalreserve.gov/faqs/currency_12773.htm|url-status=live}}</ref> As of September 20, 2023, the Federal Reserve estimated that the total amount of currency in circulation was approximately {{US$|2.33 [[trillion]]}}.<ref>{{Cite web|url=https://www.federalreserve.gov/releases/h41/20230921/|title=Federal Reserve Balance Sheet: Factors Affecting Reserve Balances - H.4.1|date=September 21, 2023|archive-url=https://web.archive.org/web/20231004014016/https://www.federalreserve.gov/releases/h41/20230921/|archive-date=October 4, 2023}}</ref>

Another popular explanation is that it is derived from the [[Pillars of Hercules]] on the [[Coat of arms of Spain|Spanish Coatcoat of arms]] of the [[Spanish dollar]]. These [[Pillars of Hercules]] on the silver Spanish dollar coins take the form of two vertical bars ('''||''') and a swinging cloth band in the shape of an '''''S'''''.{{citation needed|date=January 2023}}

The U.S. dollar was introduced at par with the Spanish-American [[Spanish dollar|silver dollar]] (or ''Spanish peso'', ''Spanish milled dollar'', ''eight-real coin'', ''piece-of-eight''). The latter was produced from the rich silver mine output of [[Spanish America]], was minted in [[Mexico City]], [[Potosí]] (Bolivia), [[Lima]] (Peru), and elsewhere, and was in wide circulation throughout the Americas, Asia, and Europe from the 16th to the 19th centuries. The minting of machine-milled Spanish dollars since 1732 boosted its worldwide reputation as a trade coin and positioned it to be the model for the new currency of the [[United States]].{{factcitation needed|date=November 2023}}

Even after the [[United States Mint]] commenced issuing coins in 1792, locally minted ''dollars'' and ''cents'' were less abundant in circulation than [[Spanish America]]n ''pesos'' and ''reales''; hence Spanish, Mexican, and American dollars all remained legal tender in the United States until the [[Coinage Act of 1857]]. In particular, colonists' familiarity with the Spanish two-''real quarter peso'' was the reason for issuing a quasi-decimal [[Quarter (United States coin)|25-cent quarter dollar coin]] rather than a 20-cent coin.{{factcitation needed|date=November 2023}}

For the relationship between the [[Spanish dollar]] and the individual state colonial currencies, see [[Connecticut pound]], [[Delaware pound]], [[Georgia pound]], [[Maryland pound]], [[Massachusetts pound]], [[New Hampshire pound]], [[New Jersey pound]], [[New York pound]], [[North Carolina pound]], [[Pennsylvania pound]], [[Rhode Island pound]], [[South Carolina pound]], and [[Virginia pound]].{{factcitation needed|date=November 2023}}

Paper money was issued again in 1862 without the backing of precious metals due to the [[American Civil War|Civil War]]. In addition to Treasury Notes, Congress in 1861 authorized the Treasury to borrow $50&nbsp;million in the form of [[Demand Notes]], which did not bear interest but could be redeemed on demand for precious metals. However, by December 1861, the [[Union (American Civil War)|Union]] government's supply of specie was outstripped by demand for redemption and they were forced to suspend redemption temporarily. In February 1862 Congress passed the [[Legal Tender Cases|''Legal Tender Act of 1862'']], issuing [[United States Notes]], which were not redeemable on demand and bore no interest, but were [[legal tender]], meaning that creditors had to accept them at face value for any payment except for public debts and import tariffs. However, silver and gold coins continued to be issued, resulting in the depreciation of the newly printed notes through [[Gresham's Lawlaw]]. In 1869, Supreme Court ruled in [[Hepburn v. Griswold]] that Congress could not require creditors to accept United States Notes, but overturned that ruling the next year in the [[Legal Tender Cases]]. In 1875, Congress passed the ''[[Specie Payment Resumption Act]]'', requiring the Treasury to allow U.S. Notes to be redeemed for gold after January 1, 1879.

The [[Constitution of the United States|U.S. Constitution]] provides that Congress shall have the power to "borrow money on the credit of the United States."<ref>{{cite web |url=https://www.law.cornell.edu/constitution/articlei#section8 |title=Paragraph 2 of Section 8 of Article 1 of the United States Constitution |publisher=Topics.law.cornell.edu |access-date=October 17, 2018 |archive-date=November 18, 2021 |archive-url=https://web.archive.org/web/20211118233715/https://www.law.cornell.edu/constitution/articlei#section8 |url-status= live }}</ref> Congress has exercised that power by authorizing [[Federal Reserve Banks]] to issue [[Federal Reserve Notes]]. Those notes are "obligations of the United States" and "shall be redeemed in lawful money on demand at the Treasury Department of the United States, in the city of Washington, District of Columbia, or at any Federal Reserve bank".<ref>{{cite web |url= https://www.law.cornell.edu/uscode/text/12/411 |title=Section 411 of Title 12 of the United States Code |publisher=Law.cornell.edu |date= June 22, 2010 |access-date=October 17, 2018 |archive-date=June 27, 2019 |archive-url=https://web.archive.org/web/20190627142205/https://www.law.cornell.edu/uscode/text/12/411 |url-status=live }}</ref> Federal Reserve Notes are designated by law as "[[legal tender]]" for the payment of debts.<ref>{{cite web |url=https://www.law.cornell.edu/uscode/text/31/5103 |title=Section 5103 of Title 31 of the United States Code |publisher=Law.cornell.edu |date=August 6, 2010 |access-date=October 17, 2018 |archive-date=October 22, 2018 |archive-url=https://web.archive.org/web/20181022211409/https://www.law.cornell.edu/uscode/text/31/5103 |url-status=live }}</ref> Congress has also authorized the issuance of [[Federal Reserve Note|more than 10 other types of banknotes]], including the [[United States Note]]<ref>{{cite web |url=https://www.law.cornell.edu/uscode/text/31/5115 |title=Section 5115 of Title 31 of the United States Code |publisher=Law.cornell.edu |date=August 6, 2010 |access-date=October 17, 2018 |archive-date=June 27, 2019 |archive-url= https://web.archive.org/web/20190627142206/https://www.law.cornell.edu/uscode/text/31/5115 |url-status=live }}</ref> and the [[Federal Reserve Bank Note]]. The Federal Reserve Note is the only type that remains in circulation since the 1970s. [[Federal Reserve Notes]] are printed by the [[Bureau of Engraving and Printing]] and are made from [[Cotton paper|cotton fiber paper]] (as opposed to [[Wood fibre |wood fiber]] used to make common paper). The "[[large-sized note]]s" issued before 1928 measured {{convert|7.42 x 3.125|in |mm |abbr= on}}, while [[small-sized note]]s introduced that year measure {{convert|6.14 x 2.61 x 0.0043|in|mm|abbr=on}}.<ref>{{Cite web |url= https://books.google.com/books?id=qqQuAAAAMAAJ&pg=PA105|title=Treasury Department Appropriation Bill for 1929: Hearing Before the Subcommittee of House Committee on Appropriations... Seventieth Congress, First Session|year=1928}}</ref> The dimensions of the modern (small-size) U.S. currency is identical to the size of [[Philippine peso]] banknotes issued under United States administration after 1903, which had proven highly successful.<ref>{{Cite book|url=https://books.google.com/books?id=DhRjDwAAQBAJ&pg=PT16|title = Standard Guide to Small-Size U.S. Paper Money – 1928-Date|isbn = 9781440225789|last1 = Schwarz|first1 = John|last2 = Lindquist|first2 = Scott |date = September 21, 2009| publisher=Penguin }}</ref> The American large-note bills became known as "horse blankets" or "saddle blankets".<ref name="Orzano">{{cite web |last1=Orzano |first1=Michele |title=What is a horse blanket note? |date = February 25, 2015 |url= https://www.coinworld.com/news/precious-metals/what-is-a-horse-blanket-note.html |website=Coin World |url-status=live |archive-date= November 29, 2021 |archive-url=https://web.archive.org/web/20211129024946/https://www.coinworld.com/news/precious-metals/what-is-a-horse-blanket-note.html }}</ref>

Currently printed denominations are [[United States one-dollar bill|$1]], [[United States two-dollar bill|$2]], [[United States five-dollar bill|$5]], [[United States ten-dollar bill|$10]], [[United States twenty-dollar bill|$20]], [[United States fifty-dollar bill|$50]], and [[United States one hundred-dollar bill|$100]]. Notes above the $100 denomination stopped being printed in 1946 and were officially withdrawn from circulation in 1969. These notes were used primarily in inter-bank transactions or by [[organized crime]]; it was the latter usage that prompted President [[Richard Nixon]] to issue an executive order in 1969 halting their use. With the advent of electronic banking, they became less necessary. Notes in denominations of [[United States five-hundred-dollar bill|$500]], [[United States one-thousand-dollar bill|$1,000]], [[United States five-thousand-dollar bill|$5,000]], [[United States ten-thousand-dollar bill|$10,000]] (discontinued, andbut still legal tender); [[United States one hundred-thousand-dollar bill|$100,000]] were all produced at one time; see [[large denomination bills in U.S. currency]] for details. With the exception of the $100,000 bill (which was only issued as a Series 1934 Gold Certificate and was never publicly circulated; thus it is illegal to own), these notes are now collectors' items and are worth more than their face value to collectors.

* In the [[Caribbean Netherlands]], part of the [[Kingdom of the Netherlands]]:

* {{Flag country|Honduras}}, official currency is [[Honduran lempira]]<ref>{{Cite news |url=https://www.laprensa.hn/honduras/honduras-roatan-prefiere-cobrar-dolares-lempiras-no-bitcoin-cirptomonedas-DC16361064 |title=Roatán prefiere cobrar en dólares o lempiras; no bitcóin |trans-title=Roatán prefers to charge in dollars or lempiras; not bitcoin |langlanguage=es |website=laprensa.hn |publisher=[[La Prensa (Honduras)|La Prensa]] |last=Rivera |first=Juan Carlos |date=November 23, 2023 |access-date=July 12, 2024}}</ref>

* [[Netherlands Antillean guilder]] (lower&nbsp;value, scheduled to be abolishedreplaced by [[Caribbean guilder]] in 2025)