I’m in the middle of yet-another economics history book and came across the fact that investors in the first Bank of the United States purchased their shares for $25 in gold, then the remaining $375 in a mix of gold and other means. The book then continued on to talk about how the bank functioned.
But not me. I was sitting there wondering what other currency those investors were using, as the new Bank was the only bank allowed to print U.S. dollars. It seemed a Catch-22 to pay for the shares in dollars when dollars had yet to be printed.
Solving mysteries like this is how I relax. (Yes, I know I’m not normal.)
The internet doesn’t always have answers to historical questions like this. There are a lot of everyday tasks that people take for granted and which don’t end up in books. 200 years from now readers probably won’t know the difference between swiping and tapping a credit card, if they’ll even know what a credit card is.
In any case, Google and Wikipedia provided no direct answer to my question. The best I found was a reference to The Origins and Economic Impact of the First Bank of the United States, 1791-1797 by David Cowen. The title seemed promising and the online reviews glowing, but would it answer my question? Amazon has a few used copies, but I don’t like waiting weeks for a used book that may not be worth either the wait or the cost, plus I was about to head up to Alaska for a week.
No library in Seattle had a copy. No library in Anchorage had a copy. Google Books hadn’t scanned it. I could find no more promising source of an answer on the Internet. And no, I don’t give up when a question like this appears.
My brilliant wife suggested a solution, “Just ask the author.”
Turns out David Cowen is the President of The Museum of American Finance in New York City. Turns out that book is his PhD thesis. Turns out he’s an incredibly nice and generous person, who upon receiving my email plea for an answer send me a PDF of his book and a page number to find my answer.
The answer turned out to be government bonds. 6% U.S. government bonds (another of Hamilton’s inventions) were the other form of payment beyond gold or silver.
And more importantly, the bigger answer is that while Google and Wikipedia often have an answer, the better answers still come from people, especially people who spent years gathering and organizing knowledge.