On July 6, 1785, the dollar was adopted as the monetary unit of the United States. The term dollar traces its origin back to the name of a European silver coin, the "thaler" which is a German name meaning "valley" and refers to the location of the mines from which it originated. At the time, the U.S. wanted to get away from British influence as well as the British monetary unit, the pound. The adoption of the dollar began in 1782 when Thomas Jefferson suggested the U.S. adopt the dollar because the thaler was already circulating in many areas in the Spanish and British colonies of North America.

Although the dollar was adopted in 1785, it wasn't until 1792 that a bill was passed which established the mint. Further, it wasn't until 1794 that the first American dollars began to appear in circulation. With regard to the symbol "$" for the dollar, there are many theories as to how it was chosen to represent the dollar. One theory suggests that the symbol is a combination of the letters p and s, which at the time was the abbreviation for the peso. Another theory suggests that the symbol was based on the letters U and S, which stands for the United States. Further yet, another theory believes that the symbol is representative of the Pillars of Hercules which appeared on the Spanish dollar.

Wherever its origins, the U.S. dollar is one of the most used currencies today, with several countries using it as their own currency and many using it in international trade. The dollar is also commonly referred to as greenbacks or bucks. (For a related reading, check out Unofficial Dollarization and The Greatest Currency Trades Ever Made.)

Related Articles
  1. Economics

    The History of Stock Exchanges

    Stock exchanges began with countries who sailed east in the 1600s, braving pirates and bad weather to find goods they could trade back home.
  2. Economics

    How Warren Buffett Made Berkshire A Winner

    Berkshire Fine Spinning Associated and Hathaway Manufacturing Company merged in 1955 to form Berkshire Hathaway.
  3. Economics

    Understanding the History of Money

    Money has been a part of human history for at least 3,000 years, evolving from bartering to banknotes.
  4. Forex Fundamentals

    How To Calculate An Exchange Rate

    An exchange rate is how much it costs to exchange one currency for another.
  5. Forex Education

    Bretton Woods: How It Changed the World

    While the Bretton Woods system is no longer in place, it fundamentally changed the international monetary order.
  6. Forex Education

    Who are Japanese Housewives?

    The term “Japanese housewives” refers to the thousands of Japanese women who traded in the currency markets in the first decade of the new millennium.
  7. Products and Investments

    Why MLPs May Be a Thing of the Past

    Do rising rates as well as lower oil prices mean a bleak future for master limited partnerships?
  8. Professionals

    7 Careers That No Longer Exist

    Learn how technology and innovation has led to the near-extinction and elimination of seven careers that once employed hundreds of thousands of people.
  9. Economics

    Management Strategies From A Top CEO

    Jack Welch is a legend in the business world: during the two decades he was CEO of General Electric, the company’s value rose by 4000%.
  10. Investing News

    Betamax, International Symbol Of Bad Marketing, Is Finally Dead (SNE)

    Sony Betamax is the business textbook case study of a company's spectacular oversight in assessing consumer demand. Now, Sony is finallly discontinuing it.
RELATED FAQS
  1. How did Enron use off-balance-sheet items to hide huge debts and toxic assets?

    Prior to its infamous accounting scandals and collapse, Enron used off-balance-sheet special purpose vehicles (SPVs) to hide ... Read Full Answer >>
  2. Where did the term 'Nostro' account come from?

    The term "nostro" is Italian in origin. It means "our" or "ours." In accounting and finance, nostro accounts are often differentiated ... Read Full Answer >>
  3. Can the Herfindahl-Hirschman Index be used to determine competitive balance in professional ...

    Although the measurement and analysis of a company's key performance indicators (KPIs) vary by company, it is important to ... Read Full Answer >>
  4. What is operations management theory and how can it help a business?

    Operations management is concerned with controlling the production process and business operations in the most efficient ... Read Full Answer >>
  5. What is Apple's current mission statement and how does it differ from Steve Job's ...

    Apple's current mission statement is "Apple designs Macs, the best personal computers in the world, along with OS X, iLife, ... Read Full Answer >>
  6. How do notaries reduce asymmetric information risk?

    A notary acts as an intermediary who can help mitigate the problems caused by asymmetric information in economic transactions. ... Read Full Answer >>
Hot Definitions
  1. Black Swan

    An event or occurrence that deviates beyond what is normally expected of a situation and that would be extremely difficult ...
  2. Inverted Yield Curve

    An interest rate environment in which long-term debt instruments have a lower yield than short-term debt instruments of the ...
  3. Socially Responsible Investment - SRI

    An investment that is considered socially responsible because of the nature of the business the company conducts. Common ...
  4. Presidential Election Cycle (Theory)

    A theory developed by Yale Hirsch that states that U.S. stock markets are weakest in the year following the election of a ...
  5. Super Bowl Indicator

    An indicator based on the belief that a Super Bowl win for a team from the old AFL (AFC division) foretells a decline in ...
Trading Center