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The History of Australian Money 1788-1851

The History of Australian Money 1788-1851. Early Australia. Australia didn’t need money Coins were brought in soldier’s pockets It was supposed to be a prison It lasted as a prison until more people were attracted to a new opportunity for freedom. A Barter System.

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The History of Australian Money 1788-1851

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  1. The History of Australian Money1788-1851

  2. Early Australia • Australia didn’t need money • Coins were brought in soldier’s pockets • It was supposed to be a prison • It lasted as a prison until more people were attracted to a new opportunity for freedom

  3. A Barter System • Used to pay wages for forty years • Convicts could barter/sell rations or clothing for rum (spirits) • A reward of thirty pounds of flour for finding a person who is trading with a convict

  4. Rum Money • Boats cost five or six gallons of rum in 1793 for use in the Sydney Harbor • The rum would circulate, just as money today

  5. Rare Money • Money was hardly ever used before 1800 • Men who built the first church got mostly money, but the rest was paid to them in goods • The only money was that brought to Australia by traders

  6. Early Exchange • In 1805, the King approved the use of promissory notes • Along with notes, there were pennies, schillings, Indian rupees, Portuguese johannas, and Dutch guilders

  7. Promissory Notes • They vary in value • Also know as “sterling” in their early years • Formed to try and erase currency from Australia

  8. Petty Banking • No intention of paying what the note states • Petty banking reduced the trust that people had in promissory notes

  9. The First Banking of Australia • The New South Wales Bank • Government issued loans • Needed to control people from cheating (petty banking)

  10. Dollar System • Established in 1822 • To give an honest value to coins that will never change no matter who owns them • Government regulated • Imported all dollars in the first months of 1822

  11. Problems with System • Australian’s didn’t want to convert from pounds to dollars • Mixed forms of currency (pounds – dollars) • System didn’t last long • Government went back to pounds

  12. Settlement of South Australia • Original plans stated that banks had no place • They didn’t think that there would be a need for banks

  13. Problems in South Australia • Without banks, they had no way to pay their own employees • People coming into the country didn’t know what to bring to purchase goods from South Australia

  14. The Australian Slump • It occurred from 1841-1843 • Caused by a drop in wool prices • Caused by a rise in the costs of goods • Good land was already settled • A smaller scale of the U.S. Great Depression

  15. Resolution to slump • Exports of wool doubled • More goods for exports (wheat, potatoes, timber, etc. • People started trusting in banks • Deposits and notes issued doubled in a year

  16. Agreed Unit of Exchange • The sterling • Also know as a promissory note • Custom, not law, changed the unit of exchange to silver • This was done so that the country could exchange with other countries easier

  17. Questions

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