Introduction to Early Massachusetts Currency 1690
Introduction to Early Massachusetts Currency 1690-1750
Middle and New Tenor notes

At first Massachusetts notes were accepted at par with specie, which was predominately the Spanish American silver 8 reales, called a Spanish "dollar" by the colonists. In Massachusetts the Spanish dollar was valued at 6 shillings. In 1690 for every 6s of paper money one could obtain a Spanish silver dollar. As more paper money was put into circulation individuals would no longer accept the paper as equal to specie. By 1737 so much paper money was in circulation it took 22s6d in paper money to equal a Spanish dollar. To rectify this problem the Commonwealth decided to revalue its paper money. Starting with the issue of February 4, 1737 Massachusetts introduced a new series of notes, called New Tenor money, that was legislated to have three times the value of equivalent denomination notes from earlier emissions. However, as more notes were printed inflation continued and the value of both types of notes continued to drop. Once again, another adjustment to the currency was legislated. For the issue of January 15, 1742 the notes were to have four times the value of equivalent denomination notes from Old Tenor emissions. At this time the emissions from 1737-1740 became known as Middle Tenor or Three Fold Tenor, while the 1742 and later emissions became known as New Tenor (or four fold Tenor). In effect Massachusetts had three different types of currency circulating at once; in 1742 a Spanish dollar was valued at 24s9d in Old Tenor bills, 8s3ds in Middle Tenor bills or 6s2d in New Tenor notes. Unfortunately inflation continued so that by 1749 a Spanish dollar was valued at 45s in Old tenor bills, 15s in Middle tenor bills or 11s3d in New Tenor notes. As individuals might make a purchase using all three varieties it was essential for merchants to know the current inflation rates and to keep a conversion chart handy (various charts were printed for this purpose)!

The Currency Reform of 1749 and the Restrictions of 1751

In the hopes of remedying this bad situation in 1749 the British government sent Massachusetts Bay Colony two tons of Spanish silver coins and ten tons of British coppers (primarily 1749 dated halfpence) as reimburse for assistance they provided to the Lewisburg expedition on Cape Breton Island, Nova Scotia, during the French and Indian War (equivalent to £183,649 2s7 and 1/2d sterling). With hard currency available Massachusetts Bay passed the currency reform act of 1749. This required the redemption of all outstanding notes between March 31, 1750 and March 31, 1751 after which time all emissions became invalid and only "coined silver" at the rate of 6s per Spanish dollar could be accepted in payment of debts. There was a penalty of £50 for receiving silver at a higher rate or for accepting notes from neighboring states. The colonists thought this reform had remedied the situation. With the problem solved Massachusetts thought there was no problem in printing a new emission. In 1750, within a year of the reform, Massachusetts Bay printed an emission of fractional notes with the motto "Restitut rem" (The situation has been restored) in the bottom margin. Apparently Parliament did not take stock in the motto and viewed this act as once again heading down the road to inflation. Soon thereafter, on September 21, 1751, the British Parliament in London passed an act severely restricting Massachusetts Bay from issuing paper money. No further emissions were printed in Massachusetts until the "Soldier's notes" emission of May 25, 1775 printed by Paul Revere to pay the soldiers who were soon to fight at the Battle of Bunker Hill on June 16th.