On LSD

On L.S.D…

By: Marc Bink

Okay, okay,… the title is a little misleading. – I’m not on acid, contrary to what others may think. Last month in the letters section, we received a letter asking about the origins of the English system of pounds, shillings, and pence, abbreviated “L”, “S”, or ‘, and finally “D” or “d”. So I decided to see what I could find out.

First off, one Pound equaled 20 Shillings, or 240 Pennies. By the time the UK went decimal in 1971, the coinage consisted of a ½ Penny, a Penny(1 d), three pence (3d), sixpence (6d), Shilling (12d) Florin, (2s) ½ Crown (2s6d) a Crown, (5s), a Sovereign (20s). The English had this nasty habit of calculating wealth and value in a myriad of ways, sometimes in Pounds, Marks, or Shillings and Pence, depending on who wrote the document and their social standing. Nothing was ever really standardized until the 19th Century. Equally confusing is the coinage, with some issues being in gold, some in silver, some worth more than a Pound, and some being fractions of a Penny. The standard though, was the lowly penny; -it’s been around since the Roman times.

The Early History…

It’s generally thought that the English monetary system was inherited from the Romans. But in actuality it was copied from the French Merovingians. After the Roman Empire died out in around 440 A.D, the Anglo-Saxons continued on with the old system. They imported some of the Merovingian gold Tremisses that would have replaced the Roman Solidus in the coinage. Hence, 1 penny was equivalent to 1 Denari, or Denier, as it was referred to by the French. The Tremissis was 1 solidus, or what became known as a shilling much later on. They added a Pound, or a Livre, to this system, and then determined how many pennies it would take to reach a pound of sterling silver. The government set the standard weight for the penny; and throughout the long period that the penny was being minted this weight was subject to change as the government’s fortunes either improved or waned. The abbreviations begin to make sense using 1d to signify a penny, and 1s to signify the Solidus or Tremissis, and 1L to signify a Pound or a “Livre”. The gold coins were continually debased with silver, and disappeared entirely from the British Isles by 675 to be replaced by the abstract concept of the pound. From this point the Shilling and the Pound were used as units of account, with no physical coin in circulation. The Penny was the only coin minted for general circulation from about 675 until after 1272, when Edward I reformed the coinage. True, Henry III tried it a little earlier, minting a gold penny, but it was overweight and never caught on. Pennies were minted in fine silver, at an established weight of 20 grains. (below)

The term “penny” may be an anglicized version of the Germanic word “pfennig”, which was in use in Denmark at the time. The average daily wage for a skilled carpenter in around 1290 was a penny a day; – and if one looks up what one of those pennies currently costs in EF condition, one would find that its held up to inflation quite well, the values being anywhere from $60 to $100 today.

Every transaction involving money was based on weight. Every merchant had a scale, and knowing what a certain coin should weigh was how prices were determined. The Exchequer determined coin weights, and the denomination. After a round of inflation in the early 14th century, it was determined that more denominations and coinage were needed, so we see the emergence of the Groat, and the first gold issues. A “groat” was tariffed at 4 pence. By the late 1300’s, a skilled tradesman would earn 4d per day; – the plague having sparked off another round of inflation made it a necessity to add a higher denomination silver coin that could be still cut into quarters for lesser values. This practice of cutting coins was very popular; one still sees halved or quartered pennies and groats for sale, and, the cross on the reverse side was deliberately made for this purpose.

A Coinage Renaissance…

The Shilling, (initially called a “testoon”) now made in silver, made its emergence around 1544, with the third coinage of Henry VIII. Here again, inflation had sparked another debasing of the currency, and a larger denomination was required. Part of this debasement was Henry’s own fault; – by the time the third coinage was released, he was so broke that the coins were made from debased silver, and in use the copper started to wear through. As a result, he was called “old coppernose” because this was the first part of the coin that would show wear, and reveal the copper beneath. There was a large recoinage in 1551, and it was an attempt to modernize the coinage somewhat, and reduce the dependence on the medieval pennygroat multiples of coinage. The shilling was introduced along with a new six-pence, and three pence coin. The shilling was removed as a unit of account, and placed into circulation. This denomination became the benchmark for the general public, with the penny and its fractions being regulated to small change. Rich people still used gold, but general public rarely ever saw any of it, and were usually paid in silver coin. There were no banks, – so what one had was what one was worth. People generally hoarded and hid money in buildings or in the ground. The more urbanized areas used money, and the rural areas used a barter system that had more or less gone unchanged for centuries. The ever increasing use of cash for goods, and the increased reliance on imports was changing the way people used money, so starting with the reign of Edward VI (below) more coinage was issued in larger denominations. The silver Crown (5s) makes its appearance around this time. By Elizabeth’s time the Crown was again made in gold, (as well as silver) and the silver coinage was back up to its prior grade and fineness, reflecting the increased fortunes of the newly emerging English empire.

There never was a one pound coin; – there were plenty of denominations set at over a pound, but never a deliberately named “Pound”. The closest thing to it was a coin called a “Unite”, which became known as a sovereign. This was tariffed at 20 shillings, and was introduced during the reign of James I. Until around the 18th century, the pound was more or less an abstract concept, much like the English use of the “mark”. The general public only counted things by shillings and pence, as it was easier. However, with England’s burgeoning empire came the need for progressively higher denominations, and the Pound Sterling was standardized to 20 shillings. In 1662 the Unite, or Pound, was replaced by a coin called the Guinea, which was valued at 21 shillings. The sovereign valued at 20 shillings was reintroduced in 1817, and was replaced by a paper banknote during World War I. A new pound coin was introduced in 1983 when the paper note was discontinued. Britain was tied to the gold standard longer than any other currency, the pound was taken off the gold standard in 1945, and at which point, a gold sovereign’s value in terms of pounds and shillings began to float with the price of gold on the open market and had ceased to be a circulating legal tender coin.

The currency went through a couple of reorganizations and weight changes throughout the 19th century, starting with the “great re-coinage” of 1816. By the 1850’s it was pretty much standardized to the system that was in place until 1971. With every successive devaluation that was brought on by inflation over the centuries, the penny had shrunk in size and weight. It had gone from a fine silver coin to a lowly bronze at the end. The mint was at first loathe to make a penny out of copper; it had been considered in 1702 by Sir Isaac Newton, – but in time the Royal Mint was forced to switch, because the penny was still a useful denomination, but the cost of silver had rendered the coin to be too small and inconvenient. The half-penny and the farthing had been made from copper since the 1690’s, again because a silver coin would have been far too small and inconvenient. The last silver penny minted for general circulation happened in around 1786, and any other pennies after that date were only minted for Maundy sets.

In 1797 the mint made a series of pennies made from pure copper (above), but it had to contain one penny’s worth of copper. Needless to say it was quite large, and subsequent issues were reduced in size and weight over the years. Still, the last copper pennies of the pre-decimalization period were as large as a silver dollar in diameter.

The Canadian Connection…

So how did this all tie into the new Canadian coinage? In the 1850’s there were a lot of foreign coins circulating in Canada, and it made it difficult to establish a common value for things. So in 1854 a standard was developed, whereby 1 Cent would equal ½ d. The sizes and weights worked out reasonably well; – the shilling was similar to a quarter, and the dime was similar to a six-pence. The 50 cent piece came in close to a half-crown, so that made the dollar worth one crown. A pound was worth $5.00 in most of Canada, $4.80 in Newfoundland. The new province of Canada issues reflected this standard, with one notable exception. The first series of 1858 had a 20 cent coin instead of a 25 cent coin. The US quarter was circulating freely at that time, so a certain amount of confusion was caused and it lead to the 20 cent coin being unpopular with the public. The subsequent Dominion of Canada 25 cent piece had its weight adjusted to reflect the change, and was widely accepted. If one looks at the size of the 1935 silver dollar, one would find it was very close to the same weight and size of the English crown.

This standard remained in effect throughout the Victorian reign into the first part of the 20 century, and only started to change after the First World War, when currencies were removed from a bullion standard. By the end of WW II, the pound was worth around $4.00 Canadian, and as Britain’s fortunes declined, so did the value of the pound in relation to the dollar. An interesting thing to note is the fact that in 1919, the coinage in the UK was debased; the silver coinage was no longer made from fine silver. Its purity had dropped to 500 silver, mostly as an austerity measure brought about by World War debts. Starting in 1946 Cupro-nickel replaced silver in all circulating British coins, here again reflecting Britain’s state of indebtedness brought on by the Second World War.

Finally; – Decimalization!

At some point in the sixties it was finally decided that Britain should overhaul its currency and get on with the rest of the world. This was done more to help with the UK’s application to join in with the European Union. On February 15, 1971 a new decimal coinage was introduced in the UK; the older issues were declared “demonetized” and pulled from circulation. This process in preparation for the eventual change-over was started in 1969 with the demonetization of the half-crown and half-penny, and ended on August 31st, 1971 when all the old denominations were legally demonetized. These new coins were made close to the same size as the old issues, to facilitate an easier transition and wide public acceptance of the new system. This new currency has no intrinsic relation with the Canadian system, and is a “fiat” currency like ours is. It is still currently being used in the UK, and yes, since 1983 they’ve been making a pound coin! So there you have it; – a short history of the English currency. In future articles I’ll be exploring some of the fascinating history behind some of these denominations as well as the people who issued them and made them.

 

Previously published in the ENS “The Planchet” Magazine Vol-55 Issue-09