There is another medium of exchange not having any value in itself, but representing the credit of the government. It is, in fact, a form of "promise to pay," and for that reason it is often called "fiat money" or paper money." Paper money is largely in use in this country, and is represented by four different kinds. The first and second are called respectively Gold Certificates and Silver Certificates. These are issued by the Treasury, and represent on their face the number of gold or silver dollars held in the Treasury of the United States payable on demand to bearer. These certificates are popular on account of their convenience, and are always worth par. The third kind is the Treasury note or greenback, which is a promise to pay the bearer on demand (therefore a demand note) without interest. There are now in circulation $300,000,000 of Treasury notes. This was called into existence during the Civil War, and for a time was not worth par in gold. Now it is worth par, as the credit of the government insures their payment.
The fourth class is the National Bank note, issued by banks holding a charter from the United States, and whose circulation is secured by United States bonds deposited with the Treasurer of the United States. The payment of these notes is guaranteed by the United States Government.
Gold certificates are issued in denominations of $20 and upwards.
The Silver certificates in $1, $2, $5 and upwards, to $10,000.
The Treasury notes in $1, $2, etc., to $10,000.
The National Bank notes are issued in denominations of $5 and upwards.