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how did paper money originated in the early United States we just discussed how it originated in medieval Europe and before that we discussed how it first originated in ancient China the Chinese had developed the first paper money a thousand years before the Europeans this video will focus on the origins in the United States who played an important role in the next part of our journey before we start if you're new to this series let's just explain each of these videos can be enjoyed on their own but the former videos add to the history if you like this type of video please hit the like button and subscribe to the market is open we will soon be finishing off the origin of paper money series America didn't exist in the 1600s it was owned by the British French and Spanish empires to keep it simple we're going to refer to the British part of current day America as the 13 colonies these 13 colonies locked precious metals and they had to innovate with paper money for example early on South Carolina who is one of the original 13 colonies accepted rice as payment for state taxes to solve the difficulty of shipping rice around South Carolina eventually created rice paper notes yes paper money was backed by rice to make this even crazier tobacco rich colonies like Virginia use tobacco instead of rice as paper money its first tobacco paper notes were issued in 1727 however these 13 colonies noticed that paper money was very handy when funding Wars New Hampshire New Jersey and New York printed notes in a war in 1709 in the 1750s Virginia intensified its money printing in a war against France in order to encourage citizens to use Virginia's bills they put a 20% surcharge on all goods bought with gold or silver essentially Virginia had a sales tax but only if you bought goods in Virginia in gold or silver meaning you would be incentivized to buy goods with their paper notes one of the most prominent early American money printers was Benjamin Franklin who was born in Boston in 1706 in his 20s he worked at a printing house where he published a book that advocated for the larger use of paper money this work at the printing press gave Franklin the money printing experience that allowed him to prevent counterfeiting Benji Franklin was not as arrogant as John law who was discussed in our last video law unfortunately believed in a fallacy called the real bills doctrine which was explained in our last video Franklin also believed in this but he was more conservative and he remained cautious and his money printing for example in 1728 New Jersey begged Franklin to print more paper money as it was experiencing severe deflation which means prices were dropping an example this is say you wanted to buy an apple for a dollar in a year from now the Apple could...