Our current monetary system evolved over a period of almost 100 years. The amount of currency in circulation has increased dramatically since the first $1 and $2 bills were printed in a small room in the basement of the Treasury Department in 1862. The Treasury Department currently has over 2,500 employees who work in buildings in Washington, DC, and Fort Worth, Texas.
U.S. Currency
History
On April 2, 1792, after the U.S. Constitution was ratified, Congress passed the Mint Act, which established the dollar as the principle unit of currency. However, many changes occurred before legal tender began circulating in the United States in 1862. Prior to this, Treasury Notes were issued during times of financial stress. During 1793 to 1861, state charters allowed 1,600 private banks to print and circulate their own paper currency. At one point, there were over 7,000 varieties of state bank notes in circulation. In 1862, Congress issued United States Notes, our current legal tender.
Amount of Money in Circulation
On June 30, 1910, there was approximately $3,148,700,000 in circulation in the United States. As of June 30, 2000, there was over $571 billion in circulation. When this article was written in 2009, there was approximately $829 billion of U.S. currency in circulation. However, the majority of the money is located outside of the United States.
Life Expectancy of Money
When money wears out, it is returned to the Federal Reserve Bank for destruction. One-dollar bills have an average life span of 1.8 years. Five-dollar bills average 1.3 years. Ten-dollar bills last around 1.5 years. Twenty-dollar bills usually circulate for 2 years. Fifty-dollar bills are expected to last around 4.6 years. One hundred-dollar bills have a life span of around 7.4 years. It costs around 4 cents to produce each new bill.
Production
The production of U.S. currency requires 65 separate steps. The master die is a hand-engraved, soft-steel plate. The hand-engraved master die is then transferred to a printing plate. Printing is done on a sheet-fed rotary press, which is capable of printing over 8,000 sheets per hour. Each sheet is inspected by hand for defects. The money is then overprinted with the seal and the serial numbers.
Redeeming Damaged Currency
Banks send old, damaged bills to the Federal Reserve for replacement. Money can be torn, stained, mutilated, defaced or partially destroyed and still be redeemable at a commercial bank. If more than one half of the bill has been destroyed or the denomination is not readily identifiable, the bill must be processed through the Department of the Treasury for redemption to determine the value of the currency.
Tags: United States, around years, bills have, currency circulation, Federal Reserve