The currency of our country is not a subject that gives us any anxious concern today, but at various periods in the history of Nova Scotia our ancestors had many trying and vexat ious experiences in their efforts to establish a satisfactory medium of exchange, by which the people could secure an equivalent for their products and which in turn could be used to provide for their requirements. It is quite probable however, that Nova Scotia had as little trouble in this regard as any of the Colonies that were struggling for existence under similar conditions. Robert Wallace McLaughlin, of Montreal, in an article on the "Annals of Nova Scotia Currency" read before the Royal Society of Canada in 1892 says that "no Colonial Government has given the currency question such careful attention or made such good provision for the monetary wants of the people as that of Nova Scotia."

In the early days of the Province there were no bank notes, very little coin of any kind and very little of anything in the shape of money. The principal means of buying or selling was by barter and the greater part of the trading was simply swapping commodities one with another.

A few French coins found their way across the Straits of Canso, while Cape Breton was still in the hands of the French, but these were not favourably regarded by the merchants, and as they had no established value were not made much use of.

Spanish coins, including the Spanish silver dollar, which became a common coin in later years, reached the Northern Colonies through trade with the West Indies. The merchants in taking these coins endeavoured to depreciate the value of them as much as possible, the result being that the coin was sent to Boston where it was rated at a higher value. In 1727 His Honour, Governor Armstrong, attempted to remedy this trouble, and called the attention of the Council at one of their meetings held at Annapolis, to the fact that merchants were endeavouripg to lower the value of the French coins which, being the only currency they had, would be by this means exported to the detriment of the whole Province, for which he desired their consideration. It was there and then decided by the Council, that these coins "be continued at their former value, and that they should be paid and received at the same rate that they had been paid and received the six months past and that a proclamation be issued out accordingly." It was also decided that a committee of the whole Board should sit the following day to discuss the matter with the inhabitants and also to prepare the Proclamation. The Committee met on the following day and on further consideration and some debate having had recourse in the meantime to an Act of Parliament, passed in the sixth year of the reign of Her late Majesty, Queen Ann, they judged proper to proceed no further.

The Act of Parliament referred to was passed in 1707, fixing certain values to foreign coins, including the Spanish and Mexican silver dollars then circulating in the various Colonies. Although this Act of the Imperial Parliament was disregarded by many of the colonies which, as stated by one writer "found a way to drive a coach and four through it," it seems to have deterred the Council at Annapolis at this time from passing any hasty legislation which might be considered conflicting therewith.

Three years later however, (1730) Governor Phillips brought the matter up again. In doing so he referred to the difficulties and inconveniences attending this Province from the want of currency, stating that the money was hoarded and sent to Boston, where it was of considerably more value than here, that the Garrison had only Boston paper money to supply their needs and that the inhabitants refused to accept it. A proclamation was therefore issued that all French as well as other Foreign silver money should pass at the same value as it did in Boston and that the paper money of New England should be a legal tender. This measure does not appear to have improved matters very much, or proyided any great supply of current money, for we find shortly afterwards that on the occasion of the Collector of Taxes making his report, his account showed receipts to be 41 7/8 bushels of wheat, 56 fowls, 4 partridges and 5s. lOd. in cash, for which the Governor was authorized to give his receipt and to reduce the quantity of the several species to money, reckoning the wheat at 50d. the hens at 18d. pullets at 5d. and partridges at 5d.

Reference has been made to the use of New England currency and the objection to it by the people. The supplies for the Garrison came for the most part from Boston. As early as 1715, Governor Caulfield entered into negotiations with one Wm. Clarke, a merchant of Boston, for supplies for the Garrison at Annapolis, fbr which he promised to pay in good bills, meaning his drafts on the Home Government, for which he obtained 50 to 60% premium in New England currency.

In giving his first order, including a generous supply of tobacco, wine, rum, lime-juice and numerous other necessaries, he adds "I must likewise desire you to pay the freight, for there is no such thing as money here."

Murdoch's history in referring to the price of commodities in 1735 calls attention to the fact that these prices are given in New England currency and that this currency is subject to a large discount as compared to Sterling money, the currency of England.

As already stated, Caulfield sold his drafts on London at 50 to 60% premium in 1715, but these drafts twenty years later, at the date of Murdoch's reference, sold at 260% premium, that is, £100 Stg. sold for £360 New England currency. Again, a few years later, 1748, £100 Stg. was worth £1100 New England currency. This state of affairs was the result of the continued issuing by the New England authorities of paper money to meet the Government expenditure, without providing a sufficient reserve for redemption, in fact no reserve at all.

In being obliged to use this currency the people of Nova Scotia were handling money which was, as compared to Sterling, at a discount of about 91%. We would consider it somewhat unsatisfactory, to say the least, if we had to transact our business with dollar bills actually worth only nine cents, and it speaks well for the business sagacity of the people of that day, that they declined to take this paper currency. An American writer referring to this matter and its effect on the New England people states that every honest man not in debt lost the greater part of his personal estate. He also remarks that the morals of the people depreciated with the currency.

These conditions were remedied in 1749 and 1750, when Massachusetts redeemed their paper currency, having been assisted in doing so by the Home Government. Although the inhabitants of Nova Scotia were still without a currency they were no doubt glad to be relieved of this rag money.

This brings us to the period of the settlement of Halifax. In July 1750, Governor Cornwallis brought to the attention of the Council that some difficulty existed in raising supplies of money necessary for the services of the colony, and that he had agreed to proposals made by Apthorp and Hancock, of Boston, to provide him with "dollars" upon condition, as understood by His Excellency, that this firm should also have the supplying of such stores and materials as might be wanted from Boston. On further explanation of the terms it was found that this Boston firm insisted on supplying everything required, and thus prevented His Excellency from buying anything whatever, either in Nova Scotia or in any of the other colonies. The parties referred to are described as being the two richest merchants in Boston, "made so by the public money and now wanton in their insolent demands." The Council decided that to agree to such terms would be very disadvantageous to the Government, and the greatest discouragement to the commerce of the Province, and to the settlement of Halifax in particular. His Excellency was accordingly authorized to open negotiations with a New York house as to the terms on which "dollars" could be secured from that city. His Excellency also brought to the attention of the Lords of Trade that the New England people were trading extensively with the French in Louisburg and had carried numbers of dollars to that Port during the year. He wrote: "How they find their account in that I can't conceive, unless the rum and molasses they purchase there and run to New England comes cheaper by paying dollars than in truck. It is an infamous practice and would be worthy the attention of your Lordships."

Later, in the same year, 1750, Cornwallis was still striving to secure silver dollars with little success. He advised the Lords of Trade at Home that he could not get a dollar at par on his bills. The truth of this is shown by a transaction with one Captain Bunker, whose vessel came into Halifax Harbour in distress. Cornwallis purchased from this Captain 2540 silver dollars, for which he paid 5s. Stg. each, giving his bill on London for £635 Stg. in payment. As the Imperial Act of 1707, previously referred to, placed the sterling value of the silver dollar at 4s. 6d. it is evident, that Cornwallis was much in need of something to circulate as money, otherwise he would not have paid 5s. for a 4s. 6d. coin. On the same distressed vessel was a passenger by the name of Thomas Wade ftom whom Cornwallis borrowed 800 of these silver dollars.

Cornwallis found this work somewhat troublesome. Financing under such conditions was not a bed of roses. His accounts do not appear to have been forwarded with sufficient regularity to suit the Lords of the Treasury and several of his drafts had been delayed in payment. Some of the items in his accounts were severely critized by the Lords of Trade. The quantity of rum and molasses consumed met with their special disapproval. While His Excellency replied to these criticisms in a most patient and submissive manner, he evidently chafed under the task, for in giving a full explanation of various points raised, he adds, "I wish to God some person you confide in was sent out to transact the affairs of the country relating to money matters."

We have no record as to what arrangements were finally made with regard to securing "dollars" but subsequent accounts, two or three years later, indicate that considerable amounts in this coin were brought into the Province, not only from New York and Boston, but also from England. ½d. 3d. and 4d. pieces were also sent over fjrom England.

The Spanish silver dollar had no doubt become a wellknown coin at this time, even in Nova Scotia, where money was so scarce. It had been in use in various other colonies for over one hundred years. In fact it was the standard of value wherever it was current. It reached these North American Colonies in the natural course of trade with the West Indies, and now, after the settlement of Halifax, as trade and commerce increased, larger quantities of these dollars came into the hands of the increasing population. No colony, however, knew anything of dollars and cents. This was simply a coin bearing the name of "dollar." All the colonies kept their accounts in pounds, shillings and pence, the currency of Great Britain, and each had its own idea of the value of this coin. As early as 1642 Massachusetts had valued it at 6s., but in later years it had with them many different ratings. The Maryland rating was 6s. In other colonies it ran as high as 8s. The prevailing rate, however, was 6s. These diverse and fluctuating ratings of the same coin gave rise to dissatisfaction on the part of the Home Government, and led to the passing of an Act by the Imperial Parliament in the year 1707, before referred to as having deterred currency legislation at Annapolis, in which the actual value of the dollar was declared to be 4s. and 6d., at the same time it was allowed to be rated in the colonies as high as 6s., but no higher. Other coins were to be valued in proportion. This value of 4s. 6d. as declared in the Imperial Act is of special interest to us, as it still (1915) has a bearing on our exchange transactions with England. We shall refer to this later.

Now that this coin had become better known and more plentiful in Nova Scotia, it was only natural that a fixed rating for it should be decided on in this Province. This was apparently done, but not by any enactment. The rate fixed for this silver dollar appears to have been 5s. which is the origin of "Halitax Currency," a term afterwards known beyond the borders of this City and Province. Just where and when this was done seems difficult to state. There does not appear to have been any law or Order-in-Council for it at this time. It was no doubt brought about by usage between the merchants and the general public and may have been prevalent for some years. We find no reference however, to any such valuation in the Province previous to the settlement of Halifax. As this rate of 5s. has always been referred to as "Halifax currency" and as there was very little, if any, of the coin current before 1750, it is more than probable that the rating was made about that time. The earliest reference we are able to give bearing on the matter is in 1756, and occurred in connection with the well known transportation scheme, undertaken by Nova Scotia at that time, namely, the expulsion of the Acadian French. This undertaking made necessary the chartering of numerous ships. Among them was the sloop "Dolphin," Zebad Forman, Master, who rendered his account in due form including the following item:

"To carrying 56 Neutrals more than his Compt. of two to a ton, at 9s. per two, Halifax Curry. £12 12s. is lawful money pr. Capt. Murray's directions £15-2-5."

These and similar accounts were demands on a Boston firm who had special charge of this transportation business. The money was payable in Boston Currency which at that time was based on 6s. dollars. This is shown by other accounts. The item in Capt. Forman's bill is made up in the first place in "Halifax Currency" and so stated. It is then carried out with one-fifth of the amount added thereto and extended as Boston Currency, thus showing that in order to convert "Halifax Currency" into Boston Currency (of 6 Shilling dollars) it was necessary to add one-fifth to the "Halifax Currency," which must therefore have been 5s. dollars. From this we see that before there was any parliament in Halifax to pass Currency Acts there was a "Halifax Currency" based on the value of Spanish dollars at 5s. Inasmuch as there are 20s. in a £ and four fives are twenty, there are four dollars in a pound, not sterling but "Halifax Currency."

A century and more later when the Province adopted the decimal system and accounts were kept on the dual plan, the same term was used on the same basis, Currency pounds being four dollars of five shillings each.

As we have seen, "Halifax Currency" came into use without any legal authority, and our first reference to it is in 1756. Two years later the first House of Assembly of Nova Scotia met in Halifax. They appear to have been quite alert in regard to currency matters. One of the first Acts passed was one of punishment to anyone found quilty of counterfeiting, impairing, clipping or defacing any coin current in the Province. Such a person was "to be set on the pillory by the space of one whole hour" and, presumably, in case he should become impatient during the hour, one of the ears of the offender was to be nailed to the pillory, after which he was to be whipped through the streets.

During the same session of Parliament a Bill for establishing the currency of Spanish dollars at 5s. and fixing the rate of interest on money at 7½ per cent was passed by the House and sent to the Council for their approval. The Council would not agree to this and gave as their reason that it was expressly against the Imperial Act of Parliament. A conference was held and a report made to the Committee that if the Bill was altered so as to make dollars payable at 5s. for all debts and contracts that had been or should be contracted or made within the Province, and the rate of interest on money reduced to 6 percent such a Bill might be agreed to. The Bill finally passed both Houses.

This Act does not appear in the Provincial Statutes but, through the courtesy of Mr. J. P. Edwards of Londonderry the following copy is supplied:

Chap. 7. 1758.

"An Act for Establishing the Rate of Spanish Dollars, and the Interest of Money within this Province.

"Be it enacted by his Excellency the Governor, Council and Assembly, and by the authority of the same it is hereby enacted, that from and after the first day of January, which, shall be in the year of our Lord One Thousand Seven Hundred and Fifty Nine, all Spanish Dollars (that is to say) Seville Pillar, and Mexico Pieces of Eight, weighing seventeen Penny half Penny Weight, shall be a Tender of Five Shillings, in payment of all debts and contracts that have been or shall, after the said first day of January, be made within this Province, where there shall be no special agreement to the contrary.

"And be it further enacted, that in any debt or contracts, whereon interest arises, and may, by law, be demanded and recovered, no greater sum than six pounds by the hundred for the year, and so in proportion for a less sum, shall be allowed in any Court of Law or Equity; and all contracts, mortgages, bonds, and securities, for any higher interest, shall be Null and Void.

"Provided that nothing in this Act, shall extend to maritime contracts among merchants, as Bottomry or Course of Exchange."

There seems however to have existed some doubt as to the correctness of this measure, for three years later (1761) a Bill was introduced to repeal it. The House of Assembly would not agree to repealing it. The following year Governor Belcher referred to the subject in the speech from the Throne, asking that the matter be taken up again, intimating that the prevailing Act was not in accord with the Imperial Act of 1707, the intention of which seems to have been to establish a uniform rate of the silver dollar, and other coins throughout all the colonies. To declare the dollar a legal tender at 5s. was contrary to the letter and spirit of the Imperial Act. The Governor suggested in a mild manner that the law should be repealed by the Provincial Parliament before the taking of adverse action by the Imperial authorities. The reply to the Governor's speech stated that when the matter was under consideration at the previous session, the opinion prevailed that the Provincial law did not exceed the value fixed to the "dollar" by the Imperial Act, but that consideration would be given and an effort made to obviate any difficulties that might arise. We have been unable to trace the matter further, but the Statutes of the Province give the title of the Act, without the text, and in the margin is the note "Repealed by His Majesty in Council."

Various references point to the fact that the dollar was much in use at this time. For instance, in 1762 Father Gorman wrote to Governor Belcher thanking him for sending 200 dollars by Mr. Cunningham, stating that by this he would be able to continue his work among the Indians in the Island of St. John, (now P. E. I.).

Trade with the Indian population was on the increase and it was found necessary, in the absence of money, to establish a basis of value for exchange of their products, which were principally furs. The authorities decided that this basis of value should be beaver skins. These beaver pelts were valued by the pound avoirdupois, or rather all other things were valued by so many pounds of beaver pelts. This was probably the first legalized currency of Nova Scotia. Similar measures had been adopted by other colonies. A list showing the relative values is as follows:

1   2   1   1   1   6   1   2   2½ 14   30

pound best beaver pelts            " red fox skin black fox skin silver fox pounds feathers large blanket Galls. rum     "     molasses pounds pork    "         flour

= 5    = 3    = ½   = 2    = 2½ = 1    = 2    = 1    = 1    = 1    = 1

shillings Fall beaver skins lb. spring beaver    "            "    "            "    "            "    "            "    "            "    "            "    "            "    "            "

It will be noticed that a black fox skin and a blanket were of the same value, namely, about two dollars. The difference between these two articles today runs into thousands of dollars. We do not know that the "high cost of living" was a problem of that day, but it is quite evident that some of the luxuries of life, such as rum and furs, were fairly moderate in price. Transactions at these values were no doubt made with as careful a calculation as if they had been on a gold basis. It is a matter of regret that no statistics or trade returns are available showing the volume of operations.

Canada had now come under British Rule and in 1764 at Quebec, an Ordinance for regulating and establishing the currency of the Province of Quebec was passed by the Governor and Council. The measure gives value to a dozen or more various gold and silver coins. This document rates the Spanish dollar at 6s. Another coin mentioned, is a French piece passing at the time for 4s. 6d. "Halifax" valued at 5s. 6d. There is a second reference to Halifax Currency in that 48 Marques shall be deemed equal to 1s. "Halifax" for a limited time. This measure does not appear to have been very popular. Merchants and others of the City of Quebec petitioned for a continuation of the "Halifax Currency," which petition was declined and in the following year, 1765, a petition was presented asking that the Ordinance might be re-considered, to which the Council replied, that they had considered arguments in favor of "Halifax Currency" and could not now change their decision. They went on to say to the petitioners that all petitions to their Board should assert nothing but the facts. The statement made that "Halifax Currency" was universal was, they said, not correct. Thus it is interesting to note that "Halifax Currency" was a known quantity by outside colonies even at this early date. Quebec did not appear to get much satisfaction from the measure adopted, for three years later, 1767, another petition was presented to the Governor in Council of that Province signed by several of the merchants of Quebec praying that the currency of the Province be changed to that of Nova Scotia. The prayer of the petition was not granted at the time, but ten years later, 1777, Quebec passed a new currency Act based on "Halifax Currency," This is interesting also, considering that the "Halifax Currency" law of Nova Scotia, had been repealed by His Majesty in Council.

Coming back to Halifax in 1766 we are led to believe that currency was scarce and something had to be done. It really looks as if the "lobbyist" had started in business. Someone in the House of Assembly desired a conference by Committee with the Council, on the subject of an address to the Governor, praying that an application be made to His Majesty for leave to establish a paper currency in this Province. The Committee was agreed to and after mature deliberation reported that "they found such a matter could not take place at present as there was no established fund for redeeming such a currency and it would therefore greatly depreciate." A week later another Committee was appointed and reported that they also had taken the matter into consideration and found that the emission of a paper currency would be attended with great difficulties. Another week passed and a message from the Council announced that as members of the Committee were of the opinion that the objections to a paper currency might be easily obviated, they desired another conference. A new committee was therefore appointed. They met and reported "that a committee of the House do draw up instructions for the agent in London, in order that he may be prepared to obviate any objections which might be made relative to such a measure." The House agreed to this and presumably the matter was taken up with the Imperial authorities, but nothing accomplished. A year or two later we find more conferences on the subject. First, as to sending an agent to England to solicit permission to establish a paper currency. After several more conferences and reports it was decided that instructions be sent to Richard Cumberland in London who had been appointed by His Majesty. The Governor was asked to concur in sending these instructions, but he declined, on the ground that the matter should be deferred until an opportunity be had of knowing the King's pleasure on a similar application already made. Again considered and ordered that a Bill be prepared during recess, which action looks like a "hoist" for the Paper Currency Bill.

For some years the Home Government had shown their dislike for paper currency issues and after the New England Currency fiasco they made special efforts to prevent other colonial issues, so that our petitioners did not likely receive much encouragement from that source. Notwithstanding the failure of the paper currency party to secure legislation to their satisfaction, the Treasurer was empowered to issue treasury notes to a limited amount. These were no doubt issued in anticipation of customs revenue and were therefore redeemed at certain intervals when the duties on Spring and Fall importations were collected. These treasury notes were used as currency by the people, as may be implied from advertisements in the press of that day, 1769. "To be sold for cash or Provincial notes good Cow Bay coals at 30s. pr. chaldron."

The same uncertain and shiffing conditions existed during the latter part of the 18th century. Accounts were kept in pounds, shillimgs and pence but there were frequent transactions in "dollars" as well. The Government, for instance, kept all their accounts in pounds, shillings and pence, but yet offered one hundred dollars reward for the conviction of the person who set fire to Joseph Fairbanks' hay stack. We find hay advertised for nine dollars per ton in the field, and ten dollars delivered at any person's house in the Town of Halifax. A reward of two dollars was offered to any person finding and returning a strayed, gray, roan mare 12 hands high, with a switch tail. Peter McNab offered to rent his house at £60 per year, and at the same time was willing to give eight dollars for the return of his run-away manservant, whom he described as "25 years of age, fair haired, freckled face and knocked-kneed, born in Aberdeen."

They had no means of using decimals of a dollar. The best carpenters received one dollar per day and others varied from one dollar to 3s. One might ask why both methods were used If the dollars was 5s. why not offer a reward of £2 instead of eight dollar. The reason probably was that although the people knew fully as much about pounds as they did of dollars, yet they had never seen a pound. A dollar was a definite thing. They could handle it. A "pound" meant only the equivalent in something and more than likely "an order on the store."

Twenty years later, 1787, the country had become flooded with various copper coins. An Act was passed in that year forbidding the use of any spurious half pence or other copper coin not legally current in Great Britain. The same Act placed a value of 5s. 6d. currency on the British crown, and 2s. 9d. on the half crown and 1s. 1d. on the British shilling. This Act, as well as similar Acts in this or other colonies carried very little weight. The one thing the people wanted was small change, but no provision was made for a supply, and spurious coins continued to circulate. In fact some of the leading merchants of Halifax manufactured them, and these home-made pence and half pence were current throughout the Province for many years.

The subscription list of one of the oldest country churches in the Province, that of Londonderry, including the districts of Masstown, DeBert, Folly Village, Great Village and Portaupique gives us some information as to how the finances of a suburban congregation were conducted. The list begins with the year 1797, or at least that is the earliest date readable. The Treasurer states, that he has received from the Session of the Church, being the collection gathered at the Sacrament, the sum of £6. 6s. "Halifax Currency." The list during subsequent years shows a great variety of currency common in the use of the people for the support of the Gospel. This currency appears to have contained about the same proportion of "alloy" as that used in the secular walks of life. We find among the contributions hay, hogs, maple sugar, rum and numerous other commodities, along with a scanty supply of money, all of which went to make up the limited stipend and no doubt to cheer the heart of the Minister.

As we have stated, the Act of 1787 prohibiting the use of other coins than those current in Great Britain, did not avail anything. It therefore became necessary to take more definite action, and an Act was passed in 1817 reading, "Whereas many ignorant and evil disposed persons continue to import and procure large quantities of base copper coins, etc. etc. Be it enacted that immediate measures be taken to obtain a quantity of good and proper half pence, etc. etc."

Six years seem to have elapsed before anything was done with regard to obtaining this copper coin. In 1823 an order was given, through correspondents in England, for 400,000 half pence and during the 33 years from 1823 to 1856 there were imported 2,000,000 half pence and about 900,000 pence, and from 1861 to 1864, 800,000 half cents and 2,600,000 cents, in all five to six tons of copper.

An important period in the history of our currency matters begins with the year 1812 when an Act was passed authorizing the appointment of three fit and proper persons as commissioners, to issue Treasury notes to the amount of £12,000 to be issued as follows:—

50 100 200 400 400 2000

notes of       "       "       "       "       "

£50 £20 £12/10 £5 £2/10 £1

each    =     "       =     "       =     "       =     "       =     "       =

£ 2500 2000 2500 2000 1000 2000 ——— £12000

All bore interest at six per cent from the day of issue. These notes were made legal tender and were redeemable in gold or silver. After being in circulation and finding their way back to the Treasury, through the Customs Collectors or otherwise, they were not to be re-issued but cancelled. This course was made necessary on account of the memoranda on each note regarding date of issue and date of payment and the amount of interest paid. Provision was made for calling in these notes as soon as the Treasurer found himself with surplus gold or silver to the amount of £2,000, the larger denominations to be paid off first, the interest to cease from the time specified for redemption. New notes could be issued later to replace those redeemed. The public regarded these with favour and they became popular throughout the Province. They were issued to the Military authorities to pay the troops and some assistance was thus given to their circulation. The first issues of these notes were produced by the Printer's Press. They bore the signatures of the Commissioners of the Treasury. Only one year elapsed when this issue of £12,000 was called in and a new Act passed authorizing the issue of £20,000 non-interest-bearing and re-issuable. If the Government did not possess the gold with which to redeem these notes when presented, provision was made for issuing interest bearing certificates in amounts not less than £100. Another change took place in 1817, four years later, when the authorized amount was increased to £50,000. This issue was made in April and was payable in gold or silver after the 31st of December of that year. Two years passed and an addition of £10,000 was authorized, with provisions for loaning the notes in limited amounts of £200 for three, six and nine years on the security of real estate. In 1820 a further issue of £20,000 was made, and so on for 10 or 12 years, various Acts were passed granting authority to make additional issues providing for debt certificates when there was no money in the Treasury to redeem the notes. In 1832, 20 years after the first issue of £12,000, the amount outstanding was £80,000. Notwithstanding this bountiful supply of paper currency the people had no money with which to pay their debts for importations. Flour and manufactured goods had to be imported and Province paper was not regarded as satisfactory money to outsiders. Capt. Moorsom, a Military gentleman who did some travelling through the Province, during the early years of the 19th Century, in writing to England, states that "every hard dollar realized in the mines or fisheries had to be sent to the States or England in payment of necessary importations." The chief coins current during this period were doubloons, Spanish and American dollars, an occasional British Sovereign and some British Silver. In the Eastern part of the Province every description of coin passed at a higher rate than elsewhere. These coins had a different rating in other Colonies and one never knew what value to expect on any particular coin when going beyond the limits of the Province. The Province paper was also subject to a discount when away from home. The Imperial Government had at different times sent out British silver to facilitate the payment of troops, but this silver went from the Commissariat's chest to the troops, thence to the retail merchants of Halifax and back again to the Commissariat for Bills of Exchange on England in payment of the obligations of the merchants. Capt. Moorsom says "that the effects of this scarcity of cash were not so much apparent in the Capital and in those outports of the country frequented by persons of means, but in the country towns, where so many settlers congregated, there existed the most extraordinary systems of barter and exchange. Regular scales were established for the different modifications of mixed payment in cash and goods, while the person who produced the coin without delay or subterfuge was looked upon as a prodigy of affluence and generosity."

The Government appears to have realized these unsatisfactory conditions, for during 1833 and 1834 considerable time was devoted to currency matters by the Legislators. Some considered it important to prepare for the early adoption of British Sterling money as the current money in all the British Colonies, and resolutions embodying this view were brought before the House on several occasions without any result. Various propositions in regard to a currency which could be made universal in the Colonies were made to the colonial office and among these the most reasonable was that of Mr. James Buchanan, the British Consul at New York in 1831. He proposed that "Halifax Currency" should be given a definite shape in a series of coins for use as currency in the colonies. Although no action was taken on Mr. Buchanan's proposal Professor Shortt tells us, that it pointed the way towards a better system.

The Province paper at this time (1834) was causing considerable dissatisfaction; although it passed at face it was not wanted by anybody. The Banks found it necessary to arrange with their clients who deposited the paper money that the same would be accepted in payment of withdrawals, while bills discounted and advances made by the banks were on condition that Provincial paper would be accepted for the proceeds.

At the opening of Parliament the Governor's speech referred to the commercial embarrassment in the community and stated that, if on enquiry it was found that the embarrassment was caused by the unsettled and fluctuating condition of the currency, it was the duty of the Legislators to afford the best remedy that could be applied to this very serious evil.

To some extent these unsatisfactory conditions were attributed to the issue by private firms and corporations of comparatively large amounts of notes of small denominations and of a negotiable character. The two Banks doing business in Halifax at that time also issued notes in denominations of £1 to £5. This paper was apparently regarded with no less favor than the Province paper. Prof. Shortt has information that in the case of one firm, S. Cunard & Co., their notes were sold at a premium. This well known firm had offices in St. John, N. B. and Charlottetown, P. E. I. as well as in Halifax and their notes being payable at any one of their offices were used in exchange for the transfer of money between these Cities.

An Act was passed at this time prohibiting the further issue by any firm or corporation, of any notes or such obligations intended for circulation under £5. The Act declared that the trade and commerce of the Province had been injuriously affected by the issue and putting into circulation of this paper, that the outstanding notes should be payable in gold or silver forthwith on demand, or in default they were to bear interest at the rate of twelve per cent.

Some years passed and matters did not improve. In 1846 all the Currency Acts of the Province, 22 in number, were repealed, and a new Act was passed authorizing a new issue of £1 notes in exchange for the old when presented for payment. Notwithstanding that such a large amount of the notes had been issued by the Government they appear to have had some left, for Mr. Howe reported to the House a few years later that a box had been found in the attic of the Provincial Building containing £15,000 which, without much skill, might have been put into circulation, and also that, on questioning the messenger, it was found that large quantities of notes from older plates were lying in the cellar in various states of dilapidation. These were all taken care of however and locked in an iron chest.

In 1854, when the Province was anxious to assist in the construction of a railroad, a new issue was made of £50,000 in notes of 20s. each. Subsequent issues increased the amount, and when, in 1867, the Dominion Government assumed the debt, the outstanding paper amounted to about £150,000 Currency, (all issues of these notes having been made in Halifax Currency). This amount was rapidly paid off, by the Dominion Government, although, after half a century has passed, there still remains unpaid about $39,000.

In the meantime action had been taken regarding current coin. This move had been delayed no doubt, in the hope that a universal system of currency and accounting would be adopted on the basis of sterling money, but in 1834 an Act was passed establishing a standard value of current coins. The Spanish doubloon, which had become a well-known coin, brought into the Province in the course of trade and recognized since 1819 as £4 currency, was now made a legal tender at that rate. The English shilling was made a legal tender at 1s. 3d. English 6d. at 7½d. — no larger amount than 50s. Halifax Currency authorized in one payment. The pound sterling as represented by the gold coin of the United Kingdom called a sovereign to be deemed and taken as the unit or standard or measure of money in all contracts for the payment of sterling money. This sovereign or one pound sterling was also to be 25s. currency. Copper money of the United Kingdom, as well as copper coins procured by the Province were valued in proportion. These values were based on the 5s. dollar and established a difference between sterling and currency of 3d. in the shilling, that is, 12d. sterling was 15d. currency, an addition of one quarter or 25%; a sovereign, or 20s. sterling was 25s. currency. This Act did not say that four dollars was a pound currency for they did not keep accounts in dollars at this time, although they no doubt had full knowledge of the decimal system which had been in practice in the United States for some years. No doubt these values had all been recognized for some time and many of our people today will remember them, for the coins referred to constituted our subsiduary currency for some years later.

In 1860 we were introduced to dollars and cents as a new method of accounting. Public accounts were to be kept under the new system with an additional column for the old. A new table of ratings to the current coins was enacted.

Sovereign Doubloon Silver dollars British Crown ½Crown Florin Shilling 6d.

$  5         $16         $ 1.04    $ 1.25       .62½    .50       .25       .12½

currency        "        "        "        "        "        "        "

£1-0-0        £3-4           4s. 2d. 5s.        2s. 6d. 2s.        1s.        6d.

Sterling       "       "       "       "       "       "       "

It will be readily seen that not only did the system of currency ratings in pounds, shillings and pence, given to British coins in 1834, suit itself to "Halifax Currency" but the decimal system now introduced was equally adaptable. A sovereign was £1 stg., was also £1 5s. currency, and now becomes $5.00. A shilling stg. was also 1s. 3d. currency and now 25 cents or a quarter of a dollar. A sterling 6d. was 7½d. currency, and now 12½ cents or 1/8th of a dollar. A more fitting combination, could hardly be devised and it is not to be wondered at that the "Halifax Currency" survived so long after other systems were supposed to supplant it. In fact a great many people never gave up counting their money in pounds, shillings and pence, currency, until we had a Canadian coinage of our own in dollars and cents. It was a frequent occurrence for a storekeeper for instance in quoting the price of an article to some old lady, as say, $1.75, to be asked, "How much is that?" to which he would reply "8s. 9d." The rental of a house in Halifax until a comparatively recent date was quoted in "Halifax Currency," a $200.00 house was £50 and the tenant at once realized that his rent was $50.00 a quarter. It cannot be said that Halifax Currency has entirely disappeared even yet. Within a few months a gentleman who had recently taken over some Trusts, found that he had to pay an annuity in so many pounds "Halifax Currency." There are still bank notes in circulation payable in pounds "Halifax Currency" and the modern bank teller is sometimes puzzled to know how much to pay for them in our present currency.

On the 1st of July 1871, the system of currency which had been in vogue in other parts of Canada for some years now known as Canadian Currency, was made applicable to Nova Scotia. Many Nova Scotians were very reluctant to make the change and there were many protests against it. We cannot wonder at the opposition which existed to changing the standard value of a sovereign, or £1 sterling, from the convenient amount of $5.00, to a standard which seemed so odd and unsuitable as $4.86 2/3. We had, however, been a part of the Dominion for four years and the change was inevitable, the reason for it being that we would then have a uniform standard throughout the Dominion of Canada and the United States. The explanation of the odd value given to the sovereign is that in 1834 an amendment to the Coinage Legislation of the United States placed a new standard on their $10.00 gold piece which previous to 1834 had contained 247½ grains of gold. The new law reduced the fine contents of this coin to 232.2 grains. The British sovereign, or £1 sterling, contains 113.0016 grains. As compared with the American standard the sovereign is therefore worth 486.6563. Our upper Canadian neighbors were anxious to have their currency on the same basis as that of the United States with whom their business intercourse was considerably increasing. They, therefore, some years previous to Confederation, decided to value the sovereign at £1.4.4 currency, their currency being reckoned as ours, $4.00 to the pound. The sovereign therefore in currency was,

£1             4s.       4d.

= = =

$4.00        .80        6 2/3 ———— 4.86 2/3

This is how the present value of the sovereign was arrived at. This valuation is about one cent on £100 in excess of the real value as compared with the American standard. This changing from $5.00 to $4.86 2/3 represents a discount of two and two-thirds per cent on the Nova Scotia currency, and this discount had to be applied to every debit and credit balance in all books of account in Nova Scotia on the 1st of July, 1871. The reason for a discount of two and two-thirds per cent is more easily recognized in the amount of pence in the sovereign. Our sovereign or 25s. currency equalled 300 pence. The new value of £1.4.4 currency is 292 pence, a reduction of 8d. on 300, equal to two and two-thirds on 100. The two values in pence also show the ratio frequently quoted between the two currencies, namely 73 to 75, that is the reduction of 292 and 300 to their lowest equation by dividing each by four. The inconvenience for a time was considerable, but after accounts were adjusted the people became reconciled, the new Canadian silver coin was attractive and the new system was soon working as well as the old had done.

Looking at the matter from the present day any other system than a common standard throughout Canada and the United States would have been cumbersome. The laws now governing our whole currency system, including coinage, Dominion note issue and bank circulation are framed and carefully guarded in the interest of the public. There is practically no possibility of loss to the holder of Canadian currency, whether in Dominion Government bills or bills of any of the banks. If a bank should fail its bills are good, as provision has been made for their redemption by the establishment of a Fund contributed by all Chartered Banks and placed in the hands of the Government for this purpose

Contemporary with the issue of the Provincial paper currency was the beginning and growth of banking in Halifax, an important factor in the supply of currency.

As early as 1801 a bank had been proposed but there appeared to be considerable doubt as to the wisdom of granting a charter and the matter was dropped. In 1819 a bank charter was applied for and again refused, but the supporters of this venture, Hezekiah Cogswell, Enos Collins and others, a few years later, started a private bank which became known as the Halifax Banking Company.

In 1832 an application was made to the Government for a charter for the Bank of Nova Scotia and after a very critical debate in the House of Assembly and a severe handling of the Bill by His Majesty's Council, who were practically the Board of the Halifax Banking Company, the charter was finally granted. This was the first bank charter granted by the Province. The members of the House who most strenuously opposed the incorporation of this bank have the credit of introducing into Canada a feature now universal in the charters of Canadian Banks, namely, double liability. Doctor Breckenridge states in his Article on the Canadian Banking System that this Charter of the Bank of Nova Scotia, granted by the Province in 1832, was distinctly in advance of any previously passed by other British North American Provinces.

Facilities were afforded the Bank for the circulation of their notes in denominations of £1-10, £2, £2-10 as well as larger denominations. Before a year elapsed however an Act was passed prohibiting the issue of notes under £5. This move was to enable the Province to circulate notes of the small denominations. Other Banks to receive Charters were The Union Bank of Halifax in 1856, The People's Bank of Halifax in 1864, and the Merchants Bank of Halifax, now the Royal Bank of Canada, a Dominion Charter, in 1869. Banking in Halifax has had a creditable history. There have been no failures and no disappointed depositors, but on the other hand, a long list of greatly enriched shareholders.

Nova Scotia has always had a large volume of business directly with the old country. Our wholesale merchants made their trips "Home" at regular intervals to purchase supplies, resulting in large importations from England. This made Sterling exchange a very important feature in the finances of the Province through all the years of our growth and a brief reference to the manner of dealing in it may be of passing interest.

In the old days the cost of a sterling bill was calculated by increasing the sterling amount by one-ninth of the amount in order to give the value in pounds currency. There were no dol lars and cents. A bill for £100 stg. for instance, plus one-ninth, would cost £111.2.2 2/3 currency. The reason being that sterling exchange was based on the dollar at 4s. 6d. and Halifax Currency on the dollar at 5s. That is, we added 6d. to the 4s. 6d. stg., one-ninth of the amount, and if we make payment in our currency we must increase the amount accordingly. If we paid this £111.2.2 2/3 in silver dollars of 5s. each, it would take four to each pound or 444.44 4/9 in all.

We find at a later date, however, that the same amount of silver dollars would not purchase the £100 stg. bill, for the simple reason that these dollar coins were not then worth 4s. 6d. stg. as they were in 1707 when the Imperial Act placed that value on them; their actual value was only 4s. 2d. stg., 50 pence instead of 54 pence. It was therefore necessary to add 4d. or 8 per cent to the depreciated dollar. If 8 per cent premium is added to $444.44 4/9 we find that it takes $480. in currency, to purchase the £100 bill.

This ratio of 8 per cent or $4.80 to the £1 stg. became the standard or par of exchange in Newfoundland and prevailed there until the adoption of the Canadian standard in 1895.

On the adoption of the decimal system in Nova Scotia in 1860, already referred to, sterling exchange continued to be calculated on the basis of the 4s. 6d. dollar or 4.44 4/9 to the pound sterling. The dollar coin had largely disappeared from circulation but the equivalent of a dollar in any form was fixed at 4s. stg. or 48 pence. As the old par was 54 pence stg. it was necessary to add 6 pence or 12½ per cent to the dollar in all calculations of sterling exchange, thus $4.44 4/9 plus 12½ per cent premium makes one pound sterling equivalent to $5.00 currency as fixed by statute. The Nova Scotia par was known as 12½ per cent premium until the adoption of Canadian Currency in 1871. Since that time the standard value of £1 stg. has been 4.86 2/3 Canadian Currency, as previously explained, the rate of premium on the old par being 9½ per cent.

The usual method of converting pounds sterling into Currency is to multiply the amount of pounds by 40/9ths which is the improper fraction equivalent to 4.44 4/9, the old par, and add the premium at the rate of the quotation, thus, a bill for £100 stg. at 9½ per cent premium would be calculated as follows:

9½% premium

£100      40      ————    9)4000      444.44 42.22 ——— 486.66

Canadian Currency

*This absurd and bewildering system is still practised in Canada. The United States abandoned it by enactment in 1874 which made our trouble all the greater. New York being the centre for Sterling Exchange quotations we get our rates from that city daily; these are given in dollars and cents to the pound sterling. Before a Corresponding quotation can be given in Canada a calculation is necessary. Exchange Brokers have some short cuts for these calculations. For instance if the New York telegram reads: $4.80 or 4.85 or 4.86 2/3 as the case may be to the pound sterling the broker jots on his scribbling pad:

480    480    120    ——— 108,0

or

485        485        121.25   ———— 109,1.25

or

486 2/3 486 2/3 121 2/3 ——— 109,5

and quotes the Canadian rate as 8% or 9 1/8% or 9½% respectively. The Broker's calculation is equivalent to multiplying the New York rate by 2¼ and dividing by 10.   2¼ is 9/4th. which divided by 10 is 9/40ths. To multiply by 9/40ths is equivalent to dividing by 40/9ths equal to 4 4/9ths or $4.44 4/9ths. Dividing the New York rate by the old par is practically what the broker has done.

It is to be hoped that Canadians will soon abolish this old system of quotations based on the fictitious value given to a foreign coin over two hundred years ago, and adopt the more reasonable method of rating sterling in dollars and cents.

 

————————————

1. Published in Collections of the Nova Scotia Historical Society, Vol. XX, 1915, pp. 111-137.

*The frequent and wide fluctuations in sterling exchange during the war resulted in discontinuing the per cent system in Canada; quotations are now, since 1916, made in dollars and cents per pound sterling.