Gresham, Sir Thomas

Gresham-1Sir Thomas Gresham

1519-1579

Sir Thomas Gresham was an English merchant and financier who became the financial Adviser to Queen Elizabeth I of England. In 1566-68, Thomas devoted some of his wealth to founding the Royal Exchange in London. He is still best remembered for Gresham’s Law, the statement that, “Bad money drives out good.” In effect, Gresham’s Law has been proven to be correct by our own study of the world monetary system and by archilogical evidence. As a nation tended to debase its currency, the population would begin to hoard the earlier issues and freely spend the debased coinage. Ancient hoards are most often found to have been of the finest quality of coinage causing the debased coinage to be often much rarer among surviving specimens today. Consequently, even during the 20th century, as govenments began to withdraw silver from their coinage, the public immediately began to hoard the silver coinage and freely spend the new copper-nickel coinage. The same was true of “silver certificates” (US currency redeemable in silver) during the mid to late 1960s.