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BROTHER, CAN YOU SPARE
A DIME: Emergency Currency
of the Great Depression
The worst and longest economic
downturn in modern times: the
Great Depression. This is a pay
warrant, issued by the municipal
government of Charleston, South
Carolina, USA—a sort of
government script designed to
work around the dearth of
circulating currency.
From October 29, 1929 until the beginning of the Second World War, the industrialized world suffered through one of the longest and
deepest econom ic downturns in its history. The Great Depression was a perfect storm of speculative busts, bank failures, widespread
deflation, mass unem ploym ent, and overall financial hardship that lasted for alm ost exactly a decade. Only the econom ic stimulus
caused by war, which found jobs for the unem ployed in factories or on battlefields, turned the tide.
The Great Depression began in the United States, on Wall Street in New York City. After a decade in which the stock m arket swelled to
unforeseen heights, propelled by a variety of factors including real estate speculation in Florida, the bubble suddenly and em phatically
burst. On October 24, 1929, and again five days later, the stock m arket experienced an epic collapse. Som e $ 30 billion was wiped away
virtually overnight.
“Black Tuesday” had widespread ripple effects. There were runs on banks, as terrified investors sought to withdraw their m oney. Loans
were called in. The panic worsened as banks began to fail. With fewer banks, businesses had fewer options to take out loans.
Com panies went out of business, workers were laid off. Within six m onths, the unem ploym ent rate in the United States had doubled.
President Herbert Hoover, a proponent of the theory that governm ent intervention in finance is uniform ly m alefic, gave speeches
extolling the health of the economy, but little else. The protectionist Sm oot-Hawley Act, which im posed tariffs on foreign im ports,
backfired spectacularly, and exacerbated the econom ic downturn in Europe and elsewhere. The Great Depression thus spread from the
United States to the rest of the world.
The underlying causes of the crisis rem ain a subject of debate. Som e hold with the fam ed econom ist J ohn Maynard Keynes, who at the
tim e decreed that only deficit spending by the federal governm ent to artificially sim ulate growth would fix the economy; indeed, when
President Franklin Delano Roosevelt im plem ented those policies, the econom y did show signs of recovery. Others argue that the
econom y would have recovered on its own, were it not for mism anagem ent by the Federal Reserve Bank. Probably a combination of
factors, including the world’s reliance on the increasingly-obsolete gold standard, caused the Depression to endure. Whatever the
reason, the pain was widespread and deep.
During the Great Depression, the global gross dom estic product fell by a staggering 15 percent. Half the banks in the United States
failed. Unem ploym ent soared to record levels. Municipalities were so strapped for cash that they issued pay warrants—quasi-currency
that could be used in local markets, and traded in at various tim es of the year for cash. In Europe, an econom y that had been sluggish
since the Great War continued to underperform .
The woeful financial condition in Germ any specifically led to the rise of Adolf Hitler and his Nazi regim e. Ironically, Hitler would have
som e hand in the world’s recovery from global econom ic collapse. As the Allied countries, and Great Britain especially, m obilized for
war after the Nazi invasion of Poland on September 1, 1939, there was a surge in both the m anufacturing and m ilitary sectors, which
created em ploym ent, which helped end the Great Depression.
Th e No te : So u th Caro lin a D e p re s s io n Era, p ay w arran t, $ 1 | D e p re s s io n Scrip # SC10 0 -1
Ord e r co d e : GRTD EPRESSION BN CARD
Issued by the city of Charleston, South Carolina to pay municipal employees at the height of the Depression, these pay warran ts
could be exchanged for goods at local shops; m erchants would turn them in at set tim es during the year for cash. The pay warrants
ranged from one dollar to ten dollars and accrued interest at an annual rate of four or five percent. | Dim ensions: 20 9 x 75 mm .