Pound sterling

Pound sterling . (in English pound sterling ) is the currency of the United Kingdom and the British Crown Dependencies . Its abbreviation is GBP (ISO code 4217) and is represented by the symbol £ (coming from the Latin libra’ ‘, which referred to the unit of mass). In the United Kingdom, the currency is distinguished from the unit of mass by calling the first pound sterling or simply sterling. The sterling is an Old English coin made of sterling silver, an alloy of 92.5% silver and 7.5% copper and/or other metals, and with a mass of 1.555 grams, or 1/240 of a pound. Troy. The pound is represented by a currency called the “sovereign.” Due to the position that the United Kingdom has traditionally had in world trade, the pound has been one of the main monetary units or currencies used internationally.

The full official name, pound sterling (plural sterling), is used primarily in formal contexts and also when it is necessary to distinguish the currency used in the United Kingdom from those used in other countries that have the same name. . The name of the currency — but not the names of its units — is sometimes abbreviated to just “sterling,” particularly in wholesale financial markets; for example “payment accepted in “sterling”, but not “that costs five sterling”. The term British pound is commonly used in less formal situations, although it is not an official name for the currency. After the adoption of the euro by several countries , the pound became the world’s oldest currency still in use, and currently has the third largest share of reserve currencies globally, after the US dollar and the euro. The pound sterling is the fourth most traded currency in the international exchange market behind the dollar, the euro and the Japanese yen. In 1931, the European Union forced the United Kingdom to adopt the decimal system and currently one pound is equivalent to 10 shillings and 100 pence.

Summary

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• 1 History
• 2 Security measures
• 3 Tickets
• 4 Sources

History

Pound sterling coins

In Anglo-Saxon times, small silver coins known as sceattas were used in trade: these were derived from Frisian examples , and weighed about 20 grains (1.3 grams). King Offa of Mercia (790 AD) introduced a 22.5 grain (1.5 gram) silver penny . Two hundred and forty of these were made from a silver measure known as the Tower pound: this apparently weighed 540 grains (349.9 grams). In 1526 the standard was changed to the Troy pound of 5760 grains (373.242 grams). As a monetary unit, the term pound originates from the value of the weight of one pound of high-purity silver known as sterling silver. The sterling (with the basic unit being the Tealby penny, rather than the pound) was introduced as the English currency by King Henry II in 1158 , although the name sterling was not used until later. The word sterling is from the Old French sterlin transformed to stiere in Old English (strong, firm, immovable).

The sterling was originally a name for a 1/240th pound silver penny. Originally a silver penny had slightly less purchasing power than a modern pound. In modern times the pound has replaced the pence as the basic unit of exchange as inflation has continually eroded the value of the currency. The pound sterling, established in 1560 – 1561 by Elizabeth I and her advisors, mainly Sir Thomas Gresham , which brought order to the financial chaos of Tudor England that had been caused by the “Great Debasement” of the currency, which in return caused a debilitating inflation during the years 1543 to 1551 . By 1551 , according to Fernand Braudel , the silver content of a penny had been reduced to one-third of the total. The coins had become mere fiat currencies (as modern currencies are), and the exchange rate in Antwerp where English clothing was traded in Europe, had deteriorated. All currency in circulation was taken from it to be re-coined to the highest standard, and paid for at a discount.

The pound sterling maintained its intrinsic value—“a fetish in public opinion,” Braudel called it—uniquely among European currencies, even after the United Kingdom officially adopted the gold standard, until after World War I , enduring financial crises in 1621 , in 1694-1696 , when John Locke pamphleted for the pound sterling as “an invariable fundamental unit” and again in 1774 and 1797 . Even the violent disorders of the Civil War did not devalue the pound in the money markets of Europe . Braudel attributes England’s easy credit to the restored currency, which was never devalued over the centuries, which gave security of contract and a rise to financial superiority during the 18th century . The pound sterling has been the currency of the Bank of England since its inception in 1694 .

The pound was unofficially moved from silver to the gold standard thanks to an overvaluation of gold in England that attracted gold from abroad and caused a constant importation of the silver currency, despite a revaluation of gold in 1717 by Isaac Newton , master of the Royal Mint . The de facto gold standard continued until its official adoption after the end of the Napoleonic Wars in 1816 . This lasted until the United Kingdom , in agreement with many other countries, abandoned the pattern after the First World War in 1919 . During this period, one pound could be exchanged for $4,886 US dollars.

Some discussions took place after the 1865 International Monetary Conference in Paris concerning the possibility of the United Kingdom joining the Latin Monetary Union , and a Royal Commission on International Coinage examined the issue, resulting in the decision against joining. to Monetary Union . Before the First World War , the United Kingdom had one of the strongest economies in the world, retaining 40% of the overseas investments in the world. However, by the end of the War the country owed £850 million, most of it to the United States , with interest costing the country 40% of all government spending. In an attempt to regain stability, a variation of the gold standard was reintroduced in 1925 , under which the currency was pegged to the price of gold at pre-war levels, although people could only exchange their money for gold bullion. instead of coins. This was abandoned on September 21 , 1931 , during the Great Depression, and the pound was devalued by 25%.

In common with all other currencies in the world, there is no longer any relationship with precious metals. The US dollar was the last to leave gold , in 1971 . The pound was made fully convertible in 1946 as a condition of receiving a $3.75 billion US loan after World War II . The pound sterling was used as the currency of many parts of the British Empire. As this became the Commonwealth of Nations , Commonwealth countries introduced their own currencies such as the Australian pound and the Irish pound . This evolved in the sterling zone, where those currencies are related to the pound. Since the abandonment of gold , there have been several attempts to peg the value of the pound to other currencies, initially the US dollar .

Under continued economic pressure, on September 19 , 1949 the government devalued the pound by 40%, from $4 USD to $2.80 USD. The move prompted many other governments to devalue their currencies against the dollar as well, including Australia , Denmark , Ireland , Egypt , India , Israel , New Zealand , Norway and South Africa . In the mid- 1960s , the pound came under renewed pressure since the exchange rate against the dollar was considered very high. In the summer of 1966 , with the value of the pound falling in money markets, exchange controls were tightened by the Wilson government. Among the measures, tourists were prohibited from taking more than 50 pounds out of the country, until the restrictions were lifted in 1970. The pound was eventually devalued by 14.3% to $2.41 on November 18 , 1967 .

With the end of the Bretton Woods system – not unimportant because primarily British traders had created a substantial Eurodollar market that made it more difficult for its government to maintain the US gold standard – the pound was issued at the beginning of the decade. 1970 and subject to market appreciation. The sterling zone effectively ended around this time when most of its members decided to be free against the pound and the dollar. After the adoption of the euro by several countries, the pound became the world’s oldest currency still in use, and currently has the third largest share of reserve currencies globally, after the US dollar and the euro .

Security measures

• Touch the paper – The bills are made with an exclusive textured paper.
• Raised print – In some parts of the banknote you can see a raised print by touch, such as the ‘Bank of England’ print on the top of the banknote.
• ThreadMetallic thread – The metallic thread is inserted in all the bills and appears discontinuously on each of its faces. If you look at the bill against the light, you will be able to see the metallic thread appearing as a continuous dark line.
• WatermarkWatermark – Holding the banknote up to the light you will see the portrait of the Queen, the vision is perceptible on both sides of the banknote and almost completely disappears if it is not observed against the light.
• Quality of the Printing High quality printing – The printing of the banknotes is of high quality, reflecting clear colors and without any stains.
• HologramHologram – A hologram in which, when rotated, you can see how the drawing changes between the price of the ticket and an image of Brittany.
• Fluorescent feature Ultraviolet – The banknotes are designed with ultraviolet light features in the numerical value which emits light around 365 gauges, its value appears as a bright red and green. Under normal lighting conditions there will be no trace of this number.
• Micro-letteringMicro-letters – Using a magnifying glass, you can see near the letters below the queen’s portrait the value of the note in small numbers and letters.
• Patch – The £50 banknotes are the only ones to have a patch on the front near the Queen’s portrait. As it approaches, it shows the reflection of a rose and a medallion.