Silver Dollar Blog - Re-Cap on the Bland-Allison Act

Nov 15, 2012

We hear Bland-Allison Act a lot when collecting Silver dollars. You might have read it once and forgotten the little details about it. So today we're going to re-visit that time in history. 

In a nut shell - In 1878 congress stated the U.S. Treasury must buy at market price $2,000,000 to $4,000,000 worth of silver each month. This silver would be put into circulation as silver dollars. 

With a bit more detail - Before 1873 the United States was using a bimetallic money standard. With the Coinage Act of 1873 the Untied States no longer backed both silver and gold. The only standard was the gold standard now. Before the public could bring both gold and silver to have it converted into coins. Now the treasury would only take the public's gold and mint it into a coin. Although you could still have silver minted into trade dollars.

Of course the silver mining companies gave it the name "The Crime of 73". This act also reduced the domestic money supply which in turn raised interest rates which hurt the farmers and anyone who carried a large amount of debt. Times were tough during this period and before the act was passed too. We have the Black Friday panic of 1869, Chicago fire of 1871, the influenza in 1872 and now we have the demonetization of silver in 1873. The Long depression was not just felt in the United States it went worldwide starting in 1873 and going all the way through 1879.

Here comes the Bland-Allison Act in 1878 that requires the United States Treasury to purchase at the market price $2,000,000 to $4,000,000 worth of silver each month. This silver was to be minted into silver dollars at a ratio to gold of 16 to 1. The president at the time Rutherford B. Hayes vetoed this act but congress overrode his veto and the act was passed. At first the Morgan was called a Bland dollar later in the twentieth century they started calling them Morgan dollars.

 

 



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