Mind Your Pounds and Let Your Pennies Take Care of Themselves

[mbarrick]

In round numbers, if a Pound Sterling was actually worth a pound of silver at current prices, a penny (meaning the original "old money" pre-decimalisation definition as of a measure of weight equal to 1/240th of a pound) would be worth somewhere around $1.80 in Canadian or American dollars. A loaf of bread therefore costs about 2 pennies weight of silver and a (full, Imperial) pint of beer, 5 pennies weight - which is what they cost 100 years ago.

The question to ask yourself, on this last day of the "useless" Canadian penny, is what happened in 1913 that has allowed the value of money sink to 1% of its value a hundred years ago? (Hint: In 1913 Canada passed the Bank of Canada Act and the United States passed the Federal Reserve Act.)

Source: http://www.mbarrick.net/blog/130204/mind-your-pounds-and-let-your-pennies-take-care-themselves