Why do Ex-British Colonies use Dollars Instead of Pounds? (Short Animated Documentary)
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- čas přidán 13. 01. 2020
- You'll notice that many ex-British Colonies, like Australia, Canada and New Zealand don't use pounds like their former British overlords but instead use dollars. Why? What caused these nations to switch currencies and why did they prefer America's style of currency of the Britain's? Find out in this video, the latest in my very short, animated historical documentaries (about history).
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Sources:
The Sterling Area and Economic Disintegration by Catherine R. Schenk
Gentlemanly Imperialism at Work: The Bank of England, Canada, and the Sterling Area, 1932-1936 by P. J. Cain
Economic Policy and Economic Development in Australia from 1945: A Study in Economic Administration by Douglas Copland
Because it made more cents...
*True comedy*
How punny...
I have crippling deppresion
Ba dum tish
Get out.
In case anyone is wondering, the Pound Sterling is not that complicated anymore, and was decimalised in 1971.
What took you so bloody long?
To little to late
@Boomer Galactica Not that I know of. We've changed the design of our pound coins recently, and the £5 and £10 notes are now plastic, but that's it.
A day late and a dollar short.
Yes, I saw that on the first episode of Dr. Who.
Canadians:
- Close proximity to the US & strong trade relations
Aussies:
- Heavy American influence after WWII
Kiwis:
- Because the Aussies did it
Nice name
@@thebasedspectre3048 I too am renowned for this skill.
@@dwillbecancelledsoon4086 You'll be cancelled soon
@@epRivera renowned racists always have backup alts
We’re all still disappointed that Australia didn’t change its currency to dollarydoos.
god the character running through the flowers always kills me
I mean America was pretty happy about not being poor anymore
@@gerstein03 it did help we didn’t have an economic depression every 20 years. Now we just have recessions
That and the "THUMP" when someone dies get me every time, LOL.
I dont think god put it there
Because saying your girlfriend looks like a million pounds sounds offensive
American - "My girlfriend looks like a million dollars"
Foreigner - "You mean she is green, wrinkled and smells of cocaine?"
Underrated comment!
Yeah duh because all Americans do cocaine. It really makes extra obese!
Fact! awesome comment lol
idk some couples are into that too
FRIENDSHIP ENDED WITH BRITISH ECONOMY
NOW AMERICAN CAPITALISM IS MY BEST FRIEND
What's the point of the space and then then read more?
@@odemata87 It's like a guy pausing before saying the punchline of the joke
So what’s the point of accepting the British Monarchy if they distant themselves from the Pound?
It wasn't just the economy. Like most former colonies, the Aussies didn't always feel that their parent nation treated them with the respect they deserved. Not being a major military power (and the world being a dangerous place), however, they put up with it in exchange for the protections that the British theoretically provided. When the Japanese were bearing down on them, however, Britain couldn't spare the forces to protect them. The British were too busy protecting themselves and their current colonies. So, just when things are looking really bad for the Aussies....plot twist: their rebellious older brother (who had previously told the old man to piss off and left to make their own way in the world) shows up in their hour of greatest need. Side by side they fought off the Japanese threat. The Aussies seriously don't get enough recognition for their part of the fight in the Pacific. So, by the end of the war, their governments were on the same page, and their militaries were pretty well integrated. Add to that the fact that Australia didn't have the same baggage it did with the Brits going back to its colonial days, and yes the fact that Britain was facing some tough economic times while the US was clearly the most powerful economy, and it seems like a fairly easy choice. It's even easier since they didn't really have to choose one friend over the other, just who would be their closest friend.
@@insulam821 True enough. I focused on WWII because the discussion was about changes that happened after WWII.
"Now we can't look at all the former British colonies"
The Thirteen Colonies: where am I on this map
Just the ones that didn't have a violent breakup with the family.
I don't get it :/
@@TheGKFront he didn’t talk about the United States, the first country to use the dollar
@@zacharymogel9500 cool story, shame its not true. The Spanish used dollars when the 13 colonies were still part of the english empire. Bohemia was the first country in 1518 and both spanish dollars and Bohemian ones were more common in the 13 colonies than the british pound was. But sure why not invent a "fact" that is devoid of any truth
@@Zraknul Kenya was there
I would love a video on why the British pound wasn't decimalized from the beginning. The way it used to work is bizarre
Well, you know, tradition *picture dancing through daisies*
As a quick and dirty answer, it's because the smallest coins tended to come first, and people valued currency for being highly composite. 240 is divisible by 2, 3, 4, 5, 6, 8, 10, 12, 15, 16, 20, and several more numbers, so there is a lot of utility giving change. Whereas with decimal money, even we have (in the USA) quarters, nickels, half-dollars, and so on. Because trying to carry around and give change in daily transactions using just 1 and 10 cent coins would be a bit of a _nightmare._
There are probably other, more important reasons, but this is certainly _a_ factor.
@Adi The old British system indeed inherited its units from the Roman system. But it was 240=20*12, not 360.
It was called a pound because it was originally a pound of silver so the more denominations it came in the better.
"from the beginning."? Someone please correct me if I'm wrong, but I think decimal currencies only started after the French revolution.
Perhaps a Stalinist might see that as year zero, but in reality Europe had money for centuries before that, probably with similar units which look ridiculous today. And perhaps if Napoleon had invaded Britain we might have adopted the decimal but he didn't so we kept the old units.
It's actually dollary-doos in Australia
900 DOLLARY-DOOS?!
@@AshPrimeDCFC Tobias! Did you accept a six-hour collect call from the States?
Ahh I see you are people of culture
Although Canadians legit call their dollar a "Loonie" . There is a common loon, a bird found across Canada, inscribed on one side so the coin practically named itself :D
I am Australian and I can confirm this is true
*Puts New Zealand in the thumbnail* ... 0:14 "So the two we'll discus is Canada and Australia"
OK. So which one is wrong? NZ which does exist. Or the so called "world map" you mention?
@@davidtaylor351 NZ doesn't exist, as an Australian I can confirm.
@@flynntom8057 Australian? As in "Skipp-eee" - the Bush Kangaroo!? Sorry mate! That's Disney land stuff! - Truly!
@@davidtaylor351 its true. It doesn't exist and I'm a paid actor.
@@flynntom8057 Ha! I'll need therapy!
The key reason for the change to dollars (it could have any name other then pound) was the new dollars were half the value of an old pound. Because shillings were the day to day standard for most things, to go decimal, 1 shilling became 10 cents, and a pound became 2 dollars. The new name confirmed the change in value, new system, new name, less feeling "did the price double overnight" because everything is written differently.
Thanks -- the video was missing this. I wasn't understanding if it was already a difference currency in reality why bother going through effort to rename it if no substantive change
Absolutely correct.
Also the US dollar was one of the first stable FIAT currencies with the printing of greenbacks in 1863. Most of the UK colonies did not have large gold and silver reserves. They had to print trust currency script as Lincoln did...which BTW really upset the London banks.
After the UK saw what happens when you allow 18th cen prosperous and diverse colonies to exist ...and then try to.muscle it they say SOD OFF. You try to round up all the guns, and these sucessful planters, merchants, tradesmen and shippers SHOOT YOU IN THE FACE.
So Great Britain rethought their colonial plans after 1780. Keep the colonies a bit less than prosperous. Send very few leading families to the contest. Keep sending blokes to be farmers, mill workers, trappers, miners to build a high proletariat population with loyal elites....no large self made bourgeois (home grown and educated gentry). Also keep a solid check on the guns.
Thus Canada and Australia of the 19th century.
yes
@@STho205 Several gold rushes enter the chat. Then a wool boom. Australia became fabulously wealthy in the late 1800s. Witness the grand architecture of the time. Soon after the 1788 settlement of Sydney, free settlers outnumbered convicts and soldiers. Being "free", anyone could come of their own volition. Probably the rich had less reason to leave the UK than did the poor. But Australia developed its own classist society, emulating the UK. Families who became wildly wealthy from land originally given to them as grants became known as the "squattocracy" ie they were squatters. They exist to this day.
From Wikipedia: In the 19th century, the British government claimed to own all of Australia and tried to control land ownership, ignoring Aboriginal and Torres Strait Islander sovereignty. Farmers of livestock (some of them ex-convicts) claimed land for themselves and thus were known as squatters.
Why not the kilogram? If money can be in terms of weight (one money pound traditionally equalled one pound of Silver) why not call US the "kay gow" or kgAu "a kilogram of gold". And you can make smaller units, like a gAu an mgAu etc . ...
History Matters videos just aren't the same when no one falls sideways and dies unexpectedly.
"Australia wished to distance themselves from the old imperial metropole"
>still has the British flag within their flag
GG Australia GG.
Don't worry they're going to change that flag when the queen dies and when it become a republic lmao
@@attiepollard7847 lol jokes on you the Queen's lifespan is extended by 5 years when anyone says "God save the Queen"
@@belgebelgravia100 don't worry. I'm giving her less then 5 more years to live lol
@@attiepollard7847 Nice try American, the queen is E T E R N A L
@@wholelifeahead I bet you $10,000 she not going to make it pass 2025.
I remember my grandparents talking about shillings and farthings. Saying that things use to cost 3 and 6. It sounded ridiculously confusing.
It was unless you grew up with it, decimilisation was probably one of the best things they did to the Pound Sterling.
"That thing cost 2 farts" - the British.
In the US, many of us have parents that still talk about fractions of coins as currency, ex: one bit, 2 bits.
It's like when I hear people talking about imperial measurements in fractions. My brain just stops going along with it. It's bad enough here in the UK, where we're sort of stuck between both imperial and metric...
@@himaro101 in Canada we just relabel US units in metric units. So we get abominations like cans of beer at 473 mL, or 1 American pint.
Old people in Canada used to use imperial, which of course does not map at all onto US units of the same name, or share conversion factors. A pint is 16 US fluid ounces, while an imperial pint 20 imperial fluid ounces. The pints are not the same volume either. Needless to say this is fun for things like recipes, where new measuring equipment will have metric and US Units, while grandma's will be imperial, or metric and imperial.
It's a mess, just do the French thing with universal standards and decimals for fucks sake.
It’s worth clarifying that Australia had its own pound with a value independent of the pound Sterling. When Canada adopted “the dollar“, it also used its own dollar currency, not America’s.
Yea, they adopted the concept not the physical piece of paper.
My grandpa told me that when he was a kid, U.S. banks would take Canadian dollars for the same as U.S. dollars, one for one. They don't do that now.
Thought this was common knowledge which didn’t need clarifying. Generally, it’s only extremely small counties/economies (ones you rarely hear about) that adopt an existing (usually neighbouring) currency and declare it as their officially used.
@@lancelessard2491 Because it was pegged at 1.1 CAD to 1 USD. up until 1970 before it became a floating currency. The 10% is not an insignificant difference so I’m curious as to why they allowed a 1 for 1 exchange..
@@never4ever386 My guess is that it was very small amounts he was talking about. A bank in a small town where everyone knows everyone. The neighbor's kid comes in with 44cents to deposit and one dime is Canadian, they probably just took it as a whole dime. Kids used to take small amounts to the bank back then and that was nothing unusual. Just my guess at what he was talking about.
I remember when I first heard about the currency in Harry Potter and thinking it was crazy because it had different numbers of one thing making up another thing instead of it just being 100 cents to a dollar or something simple like that. Turns out the British pound used to be exactly the same as the wizarding currency. If anything the old British system was even more confusing than the fictional wizarding one.
Brit: "I lost 250 pounds"
World: "Wow! Were you dieting?"
Brit: "No. Gambling."
Gambling on whether u gonna lose weight?
The world uses kilograms, not pounds to measure weight
@@incrediblyintelligentman2895 r/woosh. And the world doesn't use pounds for currency anymore either. That's the joke, mate ;)
@@ravenlord4 I get the joke, but the world wouldn't ask if the Brit is dieting because pounds don't exist in our vocabulary
@mr kongo r/woosh
As a Brit I'm so glad we reformed the Pound to be decimal
I still don't understand the old system
The old system was awful I'm glad it was reformed as well
Am sure the people who used it all their life didnt find it confusing. Infact they'd probably find decimlised system more confusing simply due to them being used to the old system all their lives. As someone who's only ever used the current system though, the old way seems very confusing to me. If they change it in 50 years and replace decimalisation with I dunno quantumilisation... for reasons, I'm sure well go fuck I prefer it the old way and all the youths will be like naw you decemalised dudes be tripping this way easier. There's two up quarks to every gloun yo!... easy!
@@1invag i wonder how quantumilsation would effect economies round the world
The old system is simple. The gold to silver ratio mined from the ground was about 12:1. So ... 1 troy ounce of gold = 12 troy ounces of silver ... or a troy pound of silver. Hence the pound sterling ... a pound of sterling grade silver ... (92.5% silver 7.5% copper with the copper/silver swap being a nice bit of profit for the king minting the money ... seigniorage). Now pick the bones out of that with your dollars and cents. The only reason you go away from pounds to dollars is because you don't like giving people real money and you want to fire up a printing press and create money out of paper instead of gold. The dollar represents fraud.
@@mrscreamer379 Or you could just count to 100.
Wanted to note that a former colony like Egypt still uses the pound although it was made decimal. 1 Egyptian pound equals 100 piasters.
Nifty.
And right until the Euro, Italy's currency was called the Lirawhich is the Italian word for Pound and which comes from the Latin word "libra" hence the £ derived from the letter L.
@@ixlnxs Same root for the "lb" abbreviation when talking about the pound weight measurement.
"The lack of decimalization made the pound more prone to fluctuations" - not explained.
Yup.
Because the pound and the sterling had a floating exchange rate. If decimalised, they are related by a fixed value.
@@ailo8964 What??? The "pound" *and* the "sterling"? There was only one unit: the "pound sterling"
Also, the penny and the pound sterling didn't have a floating exchange rate either. It was fixed. one pound sterling was 240 pennies. The fact that 240 is not a round number like 100 cents in one dollar is not convenient but it doesn't make the "exchange rate" floats.
240 pennies is arguably a rounder number than 100. It divides by 2,3,4,5,6,8,10,12 etc.
More different coins consisting of different materials means that fluctuations of metal prices have a greater impact on the availability and value of coins. But this generally has only a small impact on the fluctuation of monetary value, especially when there is no fixed exchance rate to a metal standard.
The volatility of the pound had more to do with the Pound sterling's fixed exchance rate, Britain's failing economy and debts within the Sterling Area.
The lack of decimalisation did not afaik make the Pound sterling more prone to fluctuations, the primary reason for decimalisation was that the pre-decimal system was just a really confusing one which made international trade unnecessarily complicated.
Can we get a video on the German Empire’s colonies?
Don't need a video for that, just wikipedia the EU
@@hansgruber788 Name checks out.
@Cool Crush Ice Killa Well, no. The German Reich under the emperor had colonies in Africa and East-Asia. The Third Reich (which was officially still the German Reich) under Hitler had none at all and only fought battles in Africa to weaken the Allies, who still had colonies. Also because Italy's army was a joke and they had trouble fighting on their own in their colonies.
Do you mean France?
@@pvip9986 it's not correct, in fact the third Reich claimed the north pole, no joke they marked it as their territory by dropping lost of mini swastika flags above it
Ah money
The only measurement we use in the US that makes more sense around the world
Lets be hoenst all America really understands is cash. If the rest of the world started measuring distances based on the lengths of bank notes America would adopt that system in a heartbeat
So in the US we use two units of measurement
How many lengths of the AR-15 (or an equivalent since the armalite patent expired) and how many lengths of an American dollar
We measure our new territory with one of these two methods depending on what we used to get the territory
Max Von Britannia 😆 as an American I totally agree
John Nope somewhat accurate tbh because dollar bills are 6 inches long and 2 of them is a foot. A standard ar15 with a full rifle barrel and a fixed stock comes up to about a yard.
Kolin Martz Bruh you right
It's still mysterious to me why this is important. Call them dollars or call them pounds, they are still not the same currency. It's actually more confusing to have multiple currencies with the same name.
Before the Euro, there were at least 3 countries using the Franc. You had the Swiss, the French and the Belgian Franc. All had their own value.
@@Wolfe1966 - Yep! I visited Europe before the EU was created (I'm old), and I actually used the French and Swiss francs. I was impressed by the French francs because they were works of art.
What might also be interesting are the countries who don't have their own native currencies, but actually use the US dollar as their money. It's a short list: Ecuador; El Salvador; Marshall Islands; Federated States of Micronesia; Palau; and East Timor.
@@Wolfe1966 don’t forget the Central and West African francs, used by 14 countries.
The Scandinavian countries use Crown. Swedish Crowns, Danish Crowns, and Norwegian Crowns 🤷🏼♀️ it is not that weird. Nor that uncommon.
@@Ikajoyeah but what's the use?
Technically all dollars, francs and crowns of different countries are different and each have their own value.
If by same, you mean as in the way the currency is like decimal or other smaller parts then also it doesn't makes sense nowadays.
For example, each dollar can be divided into 100 cents, but so can pound into 100 pence, rupees in 100 Annas, Krone(crown) into 100 of their respective term they call.
youre info is appreciated. the intermingling of a terrific sense of humor is what 'sold' me. _subscribed_
The currency was actually even more confusing than this video says, there were also florin's Crowns and tanners. Florins were worth 2 shillings, also known sometimes as "2 bob bit" (As shillings were known as bob) The Crown was worth 5 shillings, however the crown was removed in 1965 due to no one really using it, however the "Half-Crown" continued use until 1967 being worth 2 shillings and sixpence. The tanner was worth sixpence, essentially a half shilling. The Florin, Tanner, and the crown were hardly used in the later years, causing some to be stopped minting before the end of decimalisation.
All very simple for those of us born in the UK 65 years ago
So pound is basically D&D currency when someone try to split all 5 main coins?
Kent really? My god that sounds confusing 😂
@@justnoob8141 Yes. To those of us who grew up playing 1st edition AD&D the UK currency system made perfect sense.
And then if you have 2*1* shillings...
When you wake up in New York City on October 29, 1929:
2:50
*You're*
*poor*
*now*
Lol 😅
Something I think you forgot to mention was that Britain itself was trying to distance itself from Empire and was thus creating closer economic ties with Europe at the time while spurning it's former colonies. There was a general sense of abandonment in the 60's which turned even more sour when the UK entered the EU.
Are you sure? All the Brits that I hear on the internet always seem to be proud of the British empire.
@@yomamasohot6411 in the 60s, the trend seems to have reversed.
@@yomamasohot6411 Britain is and has been going through somewhat of a cultural reflection on Empire. I've personally never met anyone who was explicitly proud that we had an exploitative colonial empire though.
@Aubergine Man Productions well if you look at your leaders it's kind of clear that being proud of an empire that exploited their ancestors would be a bad move and kind of in poor taste lol.
@@cakecwkecake7479 You say that, but I genuinely wouldn't be surprised if those same members of government knew that and were proud of the Empire anyway. They certainly don't seem to care much about minorities in the UK once they've gotten to the top
I wonder how having a non-decimalized currency results in more fluctuations compared to a decimalized one
Yes, that's the one bit that made no sense to me, either.
This video as a whole makes little sense, because it talks mostly about changing the sign (which signifies nothing) and not about the structure of the currency (pegged to something?). That's in contrast with OP's usual content
@@croovy88 what do you know about banking mate?…….oh wait
UK used to have a very strong currency. It was more important than the dollar, until 1920.
The decimalisation or otherwise of a currency's major unit has ABSOLUTELY nothing to do with the way a currency fluctuates with respect to other currencies
This premise throws into question everything else being stated as fact in the video
What you said about Australia is missing some details:
- we had he Australian pound from 1910 until 14 February 1966
- our pound got its own value in 1931
- we had a push towards the metric system in this era (motoring went metric in 1974)
- we almost called the currency the "royal" but called it the dollar at the last moment
I understand why "Royal" was ultimately rejected but have never seen a reason why "dollar" was chosen. This video gives a partial explanation at best...
@@simon_patterson "Royal" was rejected because it was a pet naming project of Robert Menzies, who was near the end of his tenure as PM. "Dollar" did not have the whiff of the old non-decimal denominations with their threes (threepence) twelves (pence to the shilling) twenties (shillings to a pound) or even twenty-ones (shillings to a guinea).The Treasury did however do mockups of what "royals" would look like, and you can see them in the national Museum in Canberra.
To this day I agree that it would have been simpler to do what the UK did and just keep the pound and make it worth 100 "new" pence.
@@steelcrown7130
When the UK bought in decimals they had to introduce a "half new penny" because dividing the pound into 100 did not match the old penny. If they had done what Australia did, (make 10 shillings the dollar) then it would have been much easier for the general public. I was there in 1973 and people were still having trouble with the new currency.
Brazilian currency is called Royal in Portuguese: Real.
Menzies also floated the “koala” ugh.
American and other normal currencies: Decimal is good
Pounds: *It's rollercoaster time*
Erm.. not really the pound was around for a lot longer than the american anything, and now we use decimal on everything including the pound and the US shuns it for the old imperial system all over the place
The British pounds has existed for twice and long as the American dollar and up until the 40's the pound was the normal currency.
@joaohumbg And that's the funniest part.
The dollar was one of the first decimal forms of measurement and yet the US said "nope" to all other because they were "too french"
I mean, I get what they were going for in their idea, but personally I would probably have gone with it BECAUSE of it if I were them. It would make more sense to adopt the same system as the country which has helped you gain independence and then underwent a revolution and became a Republic like you and is the biggest rival to your former overlord than to stick with the system of the colonial era. I get why they didn't change but imo, they would probably have sent a bigger message had they done it by distancing themselves from Britain in every aspect to truly establish themselves as independent.
Oh well, it doesn't matter in the end
@@sephikong8323 From the French Revolution onwards the US distanced itself from France and it really didnt have much of a choice. Supporting the French would likely mean war with most of Europe and a complete blockade of maritime trade by the British, which would have devastated a USA that was just a few decades old and had a heavily trade based economy.
@@hadhamalnam I know that, although there would never have been a blockade because simply put, the British didn't have the means to do it whilst still trying to defend themselves.
Although, there was a time where it would be the opposite which would have meant a lack of economic opportunities, and it's not like they had good relations with the British either at the time *cough* 1812 *cough*. But in the end they just stayed relatively neutral, like always for most of its existence, after all it didn't gain anything to side with anyone (though, to get back on the subject, this had little to do with actual involvement in the conflict. I am not saying that the US should have changed, just that I find it funny that they decided to still be closer to the British despite still not liking them than to try to distance themselves from them)
Thanks for making this video, always wondered it but never got to research it ❤
Britain in 1971: you know that the pound can be decimal, right?
Canada, Australia, NZ: surprised pikachu face
One important point you missed was that Australia's first currency was created in 1813 when Governor Macquarie imported 40000 Spanish dollars and punched a hole in them to create two coins, the holy dollar and the dump to alleviate a currency shortage at that time. This was part of the reason we called our decimal currency the dollar.
And why Macquarie Bank has the logo it does.
When Ireland became independent in 1922, we used the Punt which was essentially an Irish version of the pound. We used the Punt until 2002 when we started using the Euro. Cyprus had its own pound "The Cypriot Pound" until 2007/2008. Egypt still uses the Egyptian Pound.
I love your channel keep up the great stuff!!!
You’ve quickly became my favorite history youtuber. You cover such strange but important little historical minutia’s that are so fascinating
For all it's complexity, the UK £ system was used to be easily divisible by arithmatic. Try dividing a decimal currency equally by 3, 6, or 8! Worked for millenia before calculators were invented.
And it would have made more sense if our number system was base 12, but we only have 10 fingers... And apparently people couldn't manage mental maths without something to count on.
Dividing money by 3 is a neat trick but the practical applications are minimal.
@@grizzomble Culture has changed to make it less significant and useful e.g. inflation means dividing a third of a penny (or even 1/3 of £1) is negligable, in a round of drinks or pay packet. A third of a penny in medieval times was about £5. £1 was a good month's wages or more.
I'm a bit confused -- the video says the "dollar" like it is some type of standard for currency... but I've never heard of it used that way, and each country has it's own version of the dollar that isn't pegged to the US dollar. I'm also not sure why the label "dollar" would suddenly make a country a preferred trading partner... unless it's all down to perception of "you're on my side."
Can anyone explain this?
A dollar is a unit of currency where one unit is equal to one hundred sub units. In the case of the US Dollar, dollars and cents respectively. The old English Pound wasn't decimalated in this manner until it was converted in the early 70s. The British kept the name pound, which is what is confounding about the situation.
@@michaelfoye1135 and they stubbornly insisted in calling the 100th sub-unit a new-penny and the plural new-pence instead of cents. Very confusing.
@@bloggsie45 why would you expect the penny to be call a cent? That doesn't make sense, they can call it pfenning if they want to
@@FarfettilLejl the Dollar is a kind of Si unit, a Dollar/Tellar/Talent of silver is a Hundred Cent, $1000 is a KiloTalent/GrandDollar(1Grand) a tenth of a cent is a Point/MilliCent and is equivalent to one Librae of silver, etc... this was back when a Dollar was still a standard Measurement of silver weight, only later it became free floating.
@@stanislavkostarnov2157 Always wanted to know where Dollar came from.
What does "trading with the pound" vs "trading with the dollar" really mean? Australia and Canada do not use the US dollar as currency. They have their own currency that is called the "dollar." So besides having a different name and the pound used to not be decimally divided (it is now), what does trading with the dollar even mean? The Canadian dollar's value fluctuates in relation to the dollar so its value does does not seem fixed to the value of the dollar. So besides being a different word, what is the difference?
That's exactly the point. Because the Pound wasn't a decimal system, the conversion to other systems was often difficult.
@@jamesreynolds3167 You don't have to call a currency a "dollar" to make it decimal. They could have called it a "pound" and made it decimal. What they named it is pretty irrelevant then. This entire video could be about 30 seconds long and said Canada and Australia decided to adopt decimal and dropped the absurd division style of British currency.
Two elements. Use as a reserve currency and use as a trading currency. Plus how these things related. Sterling had been the world principle reserve currency until WWII when it started to decline dramatically. In the 1950s 55% of global reserves were held in Sterling, today it's barely a 10th of that.
Up until then if you had pounds you could buy anything anywhere because just about everyone wanted them. That has been take over by the American Dollar. Hold dollars and fix your trades in dollars then the trade itself is not subject to the fluctuations of local currency (although your possible profit might be) making trading conditions that much more stable.
For this reason most commodities today are traded in dollars today. But some are _only ever_ traded in dollars: most notably crude oil and first level bulk refined oil products: the petrodollar system that emerged in the early 1970s.
@@jamesreynolds3167 other countries did it. Egypt has the Egyptian pound, South Sudan has the South Sudan pound. When South Africa decimalised its currency, it called it the Rand. It's just a name; it makes no difference to the functionality what that name might be.
@@TheEulerID Exactly. There are many different nations' currencies called dollars, which derives from the Austrian word 'thaler' - not an American invention at all!
My ex-mother-in-law was working at a bank in Adelaide when "decimilization" happened. They closed one day in pounds, and opened the next in dollars.
Ireland kept their own version of the pound, called the punt, until it changed to the Euro.
Is there where having a punt ie a bet comes from?
@@brendanroberts1310 no. Punt currency came from Irish language.
@@murpho999 so it came from Gaelic then. Thanks for clearing that up.
@@brendanroberts1310 Not really, it's a loan word. The word pound comes from the Latin pondus which means weight. It was adopted into proto-Germanic and became pound. Gaelige being neither Latin or Germanic has borrowed it. It was also adopted in Ireland to make trade with England easier, before the Norman conquests of both countries. So while someone could try to make the case that it entered the language through Latin. Ireland was a hotbed of Latin scholarship at the time. It seems far more likely that they borrowed the word from English.
For some reason i read punt as cunt
0:54 the US has a sensible measurement that is news to me as an American.
you're still manufacturing 1 cent coins which is only making less cents over time.
They still use imperial measurements and weights.
@@paulturner8372 We use U.S. Customary Units. The British redefined many units in the 19th century long after American independence but the U.S. continued using the old units.
That was a nice touch including the territory of New Guinea in the shading of Australia @2:05
A GOOD VIDEO! It is succinct and informative - thank you.
"The lack of decimalisation made the pound more volatile." Wow...
Wow, do you not know what conversion rates are?
If I come to you with $162.73 and you’re trying to conver it to a currency where 162/100 is 97.2/60 and 73/100 is 43.8/60, you can see how you’d get variable and extremely different monetary conversaions without decimalisation.
@@briansebor No, no you wouldn't. There is only one way to calculate that conversion rate. Decimalization has absolutely nothing to do with currency stability.
Currencies are a Platonic thing created by the collective imagination, so of course a decimal currency will be more stable.
Thank you so much for this video I was wondering about this exact question today
When they run through the flowers, it's like me trying to pretend that I have no homework or assignments to do, no tests to study for, no projects, all that. Even though in reality, I'm drowning in it.
South Africa went decimal in 1961. The old threepenny coin was called a "tickey" and it used to cost one tickey to make a telephone call. Decades later, public telephones were still being called "Tickey Boxes" ...
The US guy running through the field of flowers with a "We're not poor!" sign had me cackling.
Suggestion: how did the mongol empire run itself?
It didn't
@@caiarcosbotias1710 it did lol. At least stayed for several rulers longer after Genghis khan's death, than Alexander's one
On hay for the horses
@@danzoom But each ruler had less and less authority. The empire heavily depended on the loyalty to one man (Gengis Khan), and when he died, the cohesion, and such most of the imperial structure, started falling apart.
Empires by their nature tend to follow one man (or woman) and when that person dies it’s usually downhill from there, most of the time usually due to some succession shenanigans, the mongols are no different, in fact I find it quite smart they did what they did and basically broke it up and designated each to an individual, it weakened them collectively sure but imo it prolonged their inevitable decline as all empires tend to lose their grip on things after a while and breaking it down into smaller pieces means it takes longer for that to happen in my view 🤷♂️
Now make a video on why the US - A former British Colony, uses the Dollar - A Spanish nomenclature of currency! :)
Because the Founding Fathers were still pissed off over the pre-independence era when the Crown would not permit the Colonies to print their own paper currencies during a shortage of coins and so all sorts of foreign currencies were being accepted including Spanish dollars. The term stuck. It's actually surprising that the Founders didn't name the currency after the old Roman currency since they hero worshipped the ancient Roman Republic so much.
Er - German. The word dollar comes from thaler.
@@TheJeremyHolloway yeah US denarius has less of a ring than US dollar
@@TheJeremyHolloway Yeah, unfortunately our Founding father's worshipped and simped to much for the Romans that like 80 percent of words they used are Latin
The US made their own currency, now stop spreading lies you Spanish keyboard warrior
The new Australian currency was so nearly called the “royal”. When Harold Holt (a monarchist) announced decimalisation in 1963 the “royal” was chosen as the name
In the book Secret Sydney by James Cockington is a photo of the old Sydney Stadium in Rushcutters Bay. Under billboards for driving schools and Vincent’s Powders are graffiti “Royal No Dollar YES”. I had no idea what this meant until years later when I read about Menzies’ support for the Royal.
History Matters back at it again with more great content.
By why choose the dollar? Because now they have to specify to WHICH dollar they are referring. Why didn't they choose a name specific to their country? For example Australia could have gone for something like the Roo (with a hundred Joeys to the Roo).
2:07 Thank you for the 💐 hopping scene.
Thank you for the explanation
Mexico is a most curious case. They use the $ symbol for the peso because the Spanish empire invented the dollar, so Mexico kept the symbol but changed the name to peso. Even more confusing is some touristy Mexican businesses list their prices in US$ so you figure out which meaning of $ by the price with the peso typically being worth about 20 cents.
I pretty strongly suspect that the main thrust of this video is flat out wrong. The former colonies wanted to decimalise their currencies, which were already independent of the British Pound, above all else and were not especially concerned with what it was called. Signs point towards the name "dollar" being chosen simply because it was a very well known currency that was already decimalised, rather than any sort of switch of economic focus away from Britain in specific favour of the United States.
The video might be right abou Canada though, which has had a much stronger US influence than the other former colonies.
Yep. The bloke knows nothing about currencies and actually believes that the name of a currency has some kind of influence on who you trade with.
I imagine the Cold War had something to do with it too. At the end of WW2 the US was the only major economy not in shambles (the USSR was still recovering for a while) so if a country wanted loans for reconstruction/post war growth they had to choose between the US and the weakened USSR. The US used this to their advantage (so much so that the advantage still holds about 70 years later) and so the global economy shifted away from Britain
@@Foxtrotopia The USSR wasn’t in total shambles as they basically bought out Estonia, Belorussia and Latvia during WWII. It is just that the US didn’t recognize the Russian Rubles as a currency due to differences in overall system of market, which made it hard for US banks to trade with but easy for UK and other foreign banks to trade. In addition, the USSR was proving a threat to US propaganda at the end of WW2 when the Russians took over half of Germany while the US needed a coalition to achieve a similar scope of power, hence why it didn’t look good to say that during WWII the Soviets had self reliant means of war production unlike the North Atlantic pact at the time. War Production = Economic power as a generic baseline of a country’s financial wealth capabilities.
WOW!!….😱🤯 - I learned A LOT in/from this video!!
THANK YOU, for your informative videos!!😂👍👍👍👍👍
1:02 I had no idea. Now make a follow-up video explaining when and why did they make it decimal in the end.
'71. Because saying "That'll be 2 bob, 7 pence, 3 farthing" and then counting back the change was exhausting.
OMG I have always wondered this and this video was a magnificent representation of what and why and so I say thank you. I also wondered about currency evolution in British minted currency. 2 birds, one video. Well done.
A video about dropping pounds? Makes sense it came out in January.
This is a funny man. Good stuff.
Sort of missed the fact that there was an Australian Pound, priced separately to the Pound Stirling, before the switch to the dollar. The whole point: decimalisation. Not trade with the US. So that's a 'no' from me.
Yes same with NZ. Driver was metric system implementation and decimalisation. Nothing to do with trade with USA.
No they were the same as stg £
@@donalobrien9422 Donal, where's your troosers?
There's also the long history of the Spanish dollar in international trade. America's dollar was directly based off it (except decimal--Spain's was an alternative non-decimal system). Many other countries made dollars, including Britain, for foreign trade, especially in Asia.
I always wondered.
Seriously, even my friend has raised this question once while we were debating about history.
I envy your circle of friends with culture. Mine usually talk about what beer they will drink next.
This is the first video of yours I’ve watched where something clearly nonsensical is stated with no explanation (non-decimal ratios somehow causing an inherent fluctuation in value), and it’s reminded me to be a little more discerning about what I take in online. Still a fan tho.
It isn't nonsensical at all if you understand a little bit about the history of coinage. Cents are defined as 1/100th of a dollar, but before then (and still with the pound until it was decimalised) smaller coins had their own values that were independent of the top unit, and their correspondence to larger coins was merely an objective that had to be maintained through currency controls rather than a self-defined standard. He alluded to this in the video but explaining that concept in detail isn't really the video's point, and on top of that the video is intended to be short. Don't watch a short video if you want a longer and more thorough explanation of a topic.
Attend a lecture instead of watching a 3 minute video then bruh
Ironically, the Great British Pound Sterling would eventually go on to become a decimal currency itself
The British still use the Pound, but in decimal format.
The use of dollar as currency had nothing to do with the US, but was common name. The various dollars are of different value.
Just as the pounds were of different value.
The main driver was the desire to move to decimal currency.
PS. The name dollar is not a US invention.
Correct, comes from the German Thaler/Taler
@@mackenlyparmelee5440 Didn't spain invent the dollar?
@@Xeno_Channel Kind of, yes. The US dollar was originally defined as the amount of silver found in a Spanish dollar, however the name "dollar" comes from the Bohemian Joachimsthaler, named after where the silver was mined for the local coins. Spanish dollars were originally called "pesos" or pieces of eight but were later called dollars.
@@mackenlyparmelee5440 cool!
@@mackenlyparmelee5440 former Spanish colonies use Pesos
The story about the Australian adoption of dollars in this video is fiction. A decision was made to adopt the sensible decimal form of currency and if we had kept the pound the smallest unit would have been worth 2.4 pence which at the time was seen as too large. So the decision was made to adopt a currency worth 10 shillings, half of the old pound. After a lot of discussion Prime Minister Menzies, a great lover of the Queen, announced that the new currency would be called the Royal. As one, the whole nation erupted in laughter and the government backed down and announced that they'd call the new currency the dollar. So the new cent was 1.2 pence and the new 5, 10 and 20 cent coins were the same size as, and temporarily interchangeable with, the old sixpence, shilling and two shillings. A copper two cent coin worth 2.4 pence replaced the silver threepenny coin. By coincidence the new Australian dollar was, at the time, slightly above the US dollar in value.
Also, I seem to remember that one of the possible names was the 'Austal'. The odd implication from this video is that merely the name of the currency ties similarly named currencies together. ♫♫... so be prepared folks when the coins begin to mix on the 14th of February 1966."
Interesting the currency of Brazil is called "Royal" in Portuguese: "Real" and the old Argentine currency was called "Australs"
I remember back in the 1980’s when Australia, without warning, devalued their dollar from worth $1.10 American to about 85 cents American. The Aussie tourists in Singapore couldn’t change money at any banks for about a week. Credit card charges also had to be in either Singapore or American dollars only for a while. Some (mostly Indian) money changers were the only ones who would change Aussie Dollars. The catch was they wouldn’t come near the so called “official” rate. Your Aussie dollars were only worth about 70 cents American on Orchard road.
@@jameshepburn4631 The Australian dollar was floated in 1983. Previously it was fixed, from 1983 its value varied according to demand.
Perfect. Efficient. Excellent explanation.
I love your videos! Just one detail, in min 2:53 you show a map of the U.S prior to the Gadsen purchase, but you are talking about 1966.
Thank god the pound system has been simplified now. Now it’s just 100 pence to the pound with no shillings to complicate it and is much more stable now.
As a Canadian I'm still confused about British money. But it's mostly just watching tv and movies that use it so it's not a big deal. But I have to say I'd never drive in England. Too confusing
Uk
1 pound =100 pence
Us
1Dollar= 100 cents
Driving in England is actually quite easy but it can be confusing if you normally drive the other way .
J 19 plus we have roundabouts which often confuse foreigners.
Brexit should mean we go back to a sensible 12 pennies to the shilling and 20 shillings to the pound and 21 shillings to the guinea.
@@julianshepherd2038 It is actually quite sensible when you consider it was devised to be easily divisible as possible. Factors and multiples of 12 are best for this. Time is still the best example of this as far as human-created factors are concerned. (i.e. we didn't decide how many days would be in a year, that's just how the planet rotates!)
Why would the lack of decimalization make the pound 'more prone to fluctuation'? This makes no sense.
yeah I don't really get that, just seems to be a given, no explanation as to why. We decimalised to simplify our dealings with international financial markets, which was clearly a fantastic boon to the City of London. But not because old money was volatile. Otherwise it would have come much sooner.
Discrete vs continuous. So a dollar could lose 2.777% of it's value and be worth 97.223 cents. If the pound lost 2.777% of its value then it would have to round up or down to a whole imperial unit, as there were no decimal fractions. This means on average swings up or down in sterling (or subunits) would generate greater volatility than the same swing in a decimal dollar
Volatility only ever favors the rich and well-informed, like the corporate banking class
@@Pax_Veritas This still makes no sense. If a dollar loses 2.7% of its value and is worth 97.3 cents, then a pre-decimal pound that loses 2.7% of its value is worth 19 shillings, fivepence-ha'penny. The same principles apply.
@@CA-ee1et I understand what you mean but it is the sub-units of sterling that fluctuate, not the pound sterling itself. The decimal system allows for a more continuous appreciation or depreciation
My guess would be that the coins value may have been tied to the metal they were made of. The original Australian 50 cent coin was removed from circulation because it contained silver. When the price of silver went up the coins contained more then 50 cents of silver.
Spanish (and later Mexican) silver dollars were a common and universally accepted currency in the New World, which influenced the American adoption of a dollar system over an American pound and primed Canada for moving to a dollar too. These silver coins found their way into Canada's economy as far back as the French colonial period. Their usage left a quirky artefact in Canadian French, specifically relating to the expression for the quarter (i.e. the 25 cent coin).
A common and quite old French Canadian slang term for a quarter dollar coin is "trente sous" (30 sous) which is the value of a quarter of an Ancien Régime écu (the French silver coin of the day). It's the analogue of the English language term "two bits" (as in 2 eighths of a Spanish or Mexican dollar). Basically, the term for a quarter French silver coin was transposed to the Spanish and Mexican dollars and eventually to a quarter Canadian dollar coin.
Somewhat confusingly, the term "sou" (an French copper coin in use when New France was being settled) became a synonym for the cent coin and cents in general, so that any denomination below a dollar might be described as (number from 1-99) "sous" *but *if someone refers to "30 sous" as an individual object, they actually mean 25 cent coins not 30 cent amounts. So four "30 sous" make a dollar (100 "sous").
Sounds confusing but context makes it rather obvious which is being referred to. If someone describes a price as "30 sous", it's 0.30 CAD. If someone says "deux 30 sous" is your change, they mean 2 coins (quarters). And all that fun is a holdover from the dollar already being common in Canada BEFORE the Seven Years' War and the American revolution (likely due to the triangular trading patterns of the colonial nations and Spanish coin making its way up from the US and the Caribbean).
And that's why many Canadians avoid Quebec like the plague
@@joywebster2678 Québec is the only part of Canada that has a real culture. The rest is just America Lite.
I always wondered about this....!
"The Pound Sterling is not decimal and thus more volatile" does *not* make (obvious) sense. Someone please explain.
Basically, there's a higher chance it could differ on region, time, etc. Its not uniform.
@@icarusunited that makes no sense either.
Yep, video is really poorly researched and makes no sense..
@@RonJohn63 basically people are too stupid and think decimals are logical which they're not because they have no real world equivalent or values. Same can be said for kilograms and metres meanwhile miles, stone and feet all have real measurable values hence why things like acres are still used by practice industries like farming because it was the area an Ox could plough in a single day and the modern 'logical' value of this is ...
4046.856 square metres.
And I conclude Metres are a stupid measurement.
RonJohn63 Different coins had different metals, which really mattered when coins were supposed to be worth their face value. The copper coated zinc pennies that we now make in the USA originally cost less than 1 cent to make, and the silver quarters and dollars were withdrawn from circulation in the 1960s for the same reason, but just after WWII it was not as much fiat value as intrinsic value.
We almost had the Royal here but when Sir Bob heard it might get called the "caster oil" by the common people he went with calling it a dollar
We Aussies also upgraded to the Metric System around the same time that we switched to decimal currency. :) Simpler. Easier. More accurate.
@BB49 cars went to kms in 1974. XA Falcon= mph, XB Falcon= kph
Wow insightful
I was 11yrs old when NZ changed to dollars and cents from pounds, shilling and pence, we spent a couple of years in school doing conversion exercises.
Ok I get that it’s difficult to talk about every British colony that went from the pound to a dollar but it would have been interesting to know how many former colonies throughout the empire changed to dollar beyond the big 4.
You have the Caribbean islands, Singapore. Hong Kong, and some African nations.
Give an honest scope!
Kai Houston Singapore Dollar and many of the Caribbean nations
1:18 Though it should be noted that the old British Pound was able to almost always be divided, so for instance if you had a group of 3 people splitting a payment from something, each could actually get an equal share. Meanwhile with a decimal currency, you can't equally pay 3 people from one lump sum of money. Lindybeige has a nice video on the topic if you want to know a lot more. I'm just giving a VERY brief overview. Though I will say, to the people that used the old Pound system, it made a lot more sense because it's what they were raised around, it only seems so complicated to us because it's not the system we use.
To split an amount 7 ways, measure it in Guineas!
Francs were also very complicated from what I recall. There was sou, centime, gold (which I think was worth about 25 francs each?) and I still haven't figured out the exchange rates despite reading a lot of 19th century French literature.
With the Canadian dollar, 1 sou = 1 cent
No, it also was decimalized
At 2:54, the image you used for the US lacked the Gadsden purchase.
Just thought you should know
Never would’ve thought of this.
Also
Stars, yo!
For anyone wondering why the Australian flag still has the Union Jack after all this time, it's because the Union Jack portion of the flag denotes the country's origin in its modern state - that is six British colonies coming together to form a Federated Commonwealth.
Hawaii's flag still has a Union Jack, albeit not the current Union Flag pattern.
@@JBofBrisbane King Kamehameha was a huge anglophile
are you sure its not just copied off the New Zealand flag with an extra star and a change of colour?
That's not much of an explanation. If it's about the country's origin, why is Indigenous sovereignty not represented in the flag? This has been recognised by the legal system since 1992.
It's not called the union jack. It's the union flag.
Fun fact: The name of the currency "dollar" comes from the German "Taler" and it was a currency widely used in various European countries (its name was "toliar" in Slovak for example) since 15th century.
Huh, cool. I always thought it had something to do with dubloons for some reason.
@@RAFMnBgaming Well, dubloon comes from Spanish "doble" (engl. = double) because these coins were minted on both sides, not only one like most ancient coins.
Lol no, it may be the origin. But the dollar is directly named after the Dutch daaler. Which spread from the new Netherland colony to the thirteen colonies. Germany had no colonial présence in America at all. The Netherlands did..
@@thedam271 well, etymologically that doesnt rule out what I wrote :-)
@@thedam271 nope, it came from the Spanish dolar (a currency even more popular in the 13 colonies than British currencies), who in turn had it from the Taler of the HRE. Ultimately it comes from a Bohemian town, which back then in German was called Joachimstal.
Joahimstaler -> Taler -> dólar -> Dollar
What about the Rupee? British India's currency was always the Rupee and never the Pound Sterling (at least to my knowledge) and I always wondered why
Likely stems from the fact the British Government did not actually take India, the East India Company did. That was not a joke by the way. Essentially the Government gave the East India Company Monopoly on trade in India, looked away for a bit, and the East India Company essentially went and conquered most of India! Obviously its a bit more complex than that, but in a nutshell that is what happened. Hell, the Indian Army, which was bigger than the actual British Army was not under control of the British Government till around the 1850's if I recall correctly!
I suspect the Rupee was kept in India (it existed long before the Europeans arrived there, but was not standardised) primarily because the EIC preferred it that way.
@@alganhar1 there was no ‘Indian’ army before 1947. ‘India’ itself did not exist prior to that.
Canada, South Africa, NZ, and Australia used to used their own version of a pound. I think many changed the name to dollars when the changed to a decimal system.
"Pounds are Poo" is a sign I would be willing to have stuck in my lawn.
the idea of non decimal currency hadn't even crossed my mind til now, even though it seems super obvious. still blows my mind
Love to see Americans and brits arguing about the metric and imperial system..
In a video about Australia and Canada’s decisions XD
The metric system was first used 1795 in France. The imperial measures system was only adopted in 1824.
Before that was a rag tag mess of local gallons, yards etc. Every town had their own.
The Yanks and Brits always seem to manage to make everything about themselves.
@@davidreichert9392 it’s simply our world and you just livin in it 😎
How exactly does adopting the same name of the currency of another country for your currency facilitate trade with that country?
Another great episode of the James bisonnet show
2:15 Sir Robert Menzies actually preferred his name be pronounced the traditional Scottish way - sounds like "mingus." Great video!
Maybe. But have you ever heard anyone pronounce his name that way?
@@thespamdance311 yes.
Good vid but should also have explained that the Pound Sterling has since been decimalized also and is no longer so needlessly complex XD
@@curtiswhyte3297 what does that have to do with anything?
Important to note: The $ in the Canada or Australia is not exactly the same $ as the one in the USA, merely sharing name and the decimal system
The Australian $ dollar was actually worth more than the US $ during the GFC.
AUmarcus This has happened at several periods. Nothing remarkable about it.
The signs on this video were hilarious.
"Insert Earth here". Nice touch!