Editing Gold standard (section)

===Post-Civil War===
[[File:McKinley Prosperity.jpg|thumb|upright|[[William McKinley]] ran for president on the basis of the gold standard.]]
Due to the inflationary finance measures undertaken to help pay for the U.S. [[US Civil War|Civil War]], the government found it difficult to pay its obligations in gold or silver and suspended payments of obligations not legally specified in specie (gold bonds); this led banks to suspend the conversion of bank liabilities (bank notes and deposits) into specie. In 1862 paper money was made legal tender. It was a [[fiat money]] (not convertible on demand at a fixed rate into specie). These notes came to be called "[[Demand Note|greenbacks]]".{{sfn|Elwell|2011}}

After the Civil War, Congress wanted to re-establish the metallic standard at pre-war rates. The market price of gold in greenbacks was above the pre-war fixed price ($20.67 per ounce of gold) requiring [[deflation]] to achieve the pre-war price. This was accomplished by growing the stock of money less rapidly than real output. By 1879 the market price of the greenback matched the mint price of gold, and according to Barry Eichengreen, the United States was effectively on the gold standard that year.<ref name=":5"/>

The [[Coinage Act of 1873]] (also known as the Crime of ‘73) suspended the minting of the standard silver dollar (of 412.5 grains, 90% fine), the only fully legal tender coin that individuals could convert silver bullion into in unlimited (or [[Free silver]]) quantities, and right at the onset of the silver rush from the Comstock Lode in the 1870s. Political agitation over the inability of silver miners to monetize their produce resulted in the [[Bland–Allison Act]] of 1878 and [[Sherman Silver Purchase Act]] of 1890 which made compulsory the minting of significant quantities of the silver [[Morgan dollar]].

With the resumption of convertibility on June 30, 1879, the government again paid its debts in gold, accepted greenbacks for customs and redeemed greenbacks on demand in gold. While greenbacks made suitable substitutes for gold coins, American implementation of the gold standard was hobbled by the continued over-issuance of silver dollars and [[Silver certificate (United States)|silver certificates]] emanating from political pressures. Lack of public confidence in the ubiquitous silver currency resulted in a run on U.S. gold reserves during the [[Panic of 1893]].

During the latter part of the nineteenth century the use of silver and a return to the bimetallic standard were recurrent political issues, raised especially by [[William Jennings Bryan]], the [[People's Party (United States)|People's Party]] and the [[Free Silver]] movement. In 1900 the gold dollar was declared the standard unit of account and a gold reserve for government issued paper notes was established. Greenbacks, silver certificates, and silver dollars continued to be legal tender, all redeemable in gold.{{sfn|Elwell|2011}}