The date of creation for the US Dollar was July 6th, 1785. This is the legal tender of the United States of America currency. The first appearance of the USD is not the same as is seen today. Before the actual paper bills, the American currency was based around coins of weighted silver or gold.
Massachusetts became the first colony to issue its own paper currency. Soon after the expansion of their paper currency, other states started to follow the lead with the issuance of their own money. But the creation of this new form of money created a big issue with Great Brittan. What came out of this issue would be what is known as the “Currency Acts of 1751.” During these times, the actual preference of the dollar would have been the coins (Newman, 80).
After the thought of having a form of currency that represents the strong independence of a country, there was a downward fall that brought the Coinage Act of 1792. This Act would form a new type of mine for the USD. Going into further detail of this, the states were no longer allowed to issue their own currency. America would now issue its money from the banks and other private entities. The money that was issued by these entities would not be the dollar bill as we know of, but it would continue to be the beloved coin. The dollar bill currency would come to be a few decades after the Coinage Act of 1792. This had a big effect on the American currency value, and currency itself. This would shift the value of the actual money that was in circulation during this time. This would be where the American currency started to find its strength by the consistency of the issuance of a common entity.
The US dollar is one of the most powerful currencies in the world today. The American dollar is so strong due to being back by the world third-largest economy. The US dollar was originally traded as a coin as opposed to a paper bill. This was generally measured as either weighted gold or silver.
There is a symbol ($) associated with the USD. This would come from the Mexican Pesos, pieces of eight, or the Spanish piastres. On the actual dollar bills, there are many symbols that were chosen to distinctively recognize the currency. There is an American eagle flying free holding 13 arrows of war in its left talon, with the olive branch clutched in the right talon. There is a banner that is shown on the bill that says, “E Pluribus Unum”. The meaning that is associated with this is, “Out of Many, One.” Located above the eagle are 13 stars, this is the representation of the new nation. These are many symbols that are located on the many bills of value for the states.
The symbol of strength and duration can be found in an unfinished pyramid of 13 rows. In the first row, it can be read “1776” in Roman numerals. The banner below that pyramid read, “Novus Ordo Seclorum” going into the further meaning of this, “A New Order of the Ages.” This is the idea that the new era is now beginning. Finally, the very famous “all-seeing eye.” The phrase that is tied to this on the dollar bill would be “Annuit Coeptis.” The meaning of Providence Has Favored Our Undertakings” (“History of American Currency”).
With the general history of the American dollar, there are many things that happen to the market when the USD drops in value. With what is going on in the world economy have a big impact on the price of our currency. The most recent headlines that can be read in the news would be the trade war with China. The value in the USD has fluctuated quite a bit over the past year.
In September 2018, President Donald Trump imposed a $200 billion tariff on Chinese goods. This is on top of the $50 Billion that was enforced earlier this year. This will force almost half of the Chinese goods to face levies. President Trump had the tariffs start at about 10 percent, and by Jan. 1, 2019, the tariff percentage will be 25. This comes in the time of the holiday shopping of the Chinese goods that are usually purchased during this season.
The US tariffs on Chinese imports are as follows, $3 Billion was placed on imports on March 23, 2018. Following the outcome of that tariff, on April 3rd, 108, Trump proposed another tariff of $46 Billion. On April 5th, 2018, Trump initiated another $100 Billion worth of imported tariffs on China. A few months later, the POTUS proposed to equal another $200 Billion worth of tariffs on China. The tariffs that went through from April 3rd, 2018 to July 6th, 2018 are overlapping tariffs.
One of the reasons President Trump is imposing these tariffs is due to his thought of, “for months, we have urged China to change these unfair practices, and give fair and reciprocal treatment to American companies. We have been very clear about the type of changes that need to be made, and we have given China every opportunity to treat us more fairly. But, so far, China has been unwilling to change its practices” ("Trump Hits China with Tariffs on $200 Billion in Goods, Escalating Trade War").
What Trump is trying to accomplish with these tariffs is to pressure China into changing the long-standing practices that have been partaken in the past. The prices of goods that are imported to American from China are hurting how successful the American businesses can be. These tariffs that are placed on Chinese goods are starting to slow down the Chinese economy. The Chinese consumers are hesitant to spend their investments on certain services due to infrastructure spending slowing down at a very high rate. This will continue to happen to China without a solid deal to be made with trade between the two countries. The outcome of the tariffs already set, and expected to be set, will worsen the Chinese economy.
The pressure with these tariffs will not only affect China but the American people too. The first set of tariffs were set to punish China for their trade values. This was set to minimize the hurt the American people would see. The next wave of tariffs is expected to raise prices of everyday products such as; food, electronics, tools, and houseware products. The reason this wave of tariffs would hurt the Americans would be these implications hindering the profits, growth, and hiring for the businesses.
There are many US businesses that find high success with the products that come from China. Not based solely on the price of the product, but the quality for the price is generally more ideal than in other locations. The tactics that are taken are to get China, “to lower its trade barriers, stop the theft of intellectual property, and open its markets to businesses from the United States” (Bloomberg – Are You a Robot?).
The tariffs that have been set in the trade war we are in has seen the upward trends and the downward trends of a chart. With the first set of tariffs being put into place, the American dollar seen a decrease in value. The typical thought was that the trade war was going to hurt America more than it would help the nation. The start to making our dollar stronger and more independent came from this tweet from Trump, “China, the E.U. and others have been manipulating their currencies and interest rates lower, while the U.S. is raising rates and the USD gets stronger — taking away our big competitive edge. As usual, not a level playing field…” (“Twitter”).
The actual value of the USD has seen interesting price movements. Trump initiated the trade war with China on July 6th, 2018. This is a very important current event tied to the value of the USD. During the mentions of the trade war with China, the USD value was on a strong upward trend from the middle of April, until the mention of the trade war. On April 17th, 2018, the value of the USD found a bottom $89.21. The value of the dollar rose at a consistent pace until the end of May, beginning of July. The end of May 2018, the USD peaked its price at $95.025, claiming a growth of 1.06 percent. There were previous talks of a potential deal needing to be made with China to bring the cost of some things down, and if not, in short, there will be hell to pay.
During the month of June 2018, the value of the USD decreased to its low for the past month at $93.213. The price action during the summer of ’18 had the value of the USD remaining constant. There appeared to be the positives and the negatives of the economy during this time. During July 2018, is when America saw the most volatility in the USD. The price fluctuated from a high of $95.141 entering July, with a growth of 1.02 percent. The first week of July America saw a large decrease in the value of the USD to the lowest point for July at $93.733 on the 9th of July, with a decrease of 1.01 percent. This is three days after the initiation of the Chinese trade war.
The lowest value of the USD since the trade war initiation was on July 9th, 2018 at $93.733, this became the “bottom” or the support at which the price can fall to. The price action of the value has shifted up and down, showing a healthy reaction to the markets inputs/outputs. Overall, the value of the USD has fallen from its all-time high in December 2016 of $103.786. The current value of the USD is $96.465. This is lower than the all-time high by 1.07 percent, but looking at the US Dollar, D chart, you see that there has been a steady growth of the USD since the imposed and proposed tariffs of China. The results of the trade war show on the value of the dollar. The thing that is left unseen is the sturdy floors that are set for support, and the economic growth for potential.