The 1797 Cartwheel Penny, History and Inflation.

Discussion in 'Coin Chat' started by ozcopper, May 20, 2008.

  1. ozcopper

    ozcopper Junior Member

    The 1797 Cartwheel Penny, History and Inflation.
    By Ozcopper

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    The 1797 cartwheel penny is an important coin because it is the first coin made using a steam driven stamper, They were made by Matthew Boulton’s famous Soho Foundry in Birmingham.
    Each coin contained an (Av) ounce of near-pure .999 copper. Thus we know copper was worth a penny an ounce in 1797. The weight of these coins also made them ideal as substitutes for weights in measuring produce, a task for which they were intentionally designed.

    Australian Connection: In late 1800, The (ship) Porpoise arrived at Sydney Cove with almost 4 tons (£550 worth) of 1 oz., 1797 dated cartwheel pennies. The intention of the authorities was to stabilize the currency of the colonies.
    In a bid to ensure that the coins were not immediately traded back out of the colonies, Governor King issued a proclamation, which effectively doubled their face value for use in trade within the colony and placed sanctions on their import into or export from the colony.

    Purchasing Power:
    The inflation-adjusted purchasing power of the cartwheel penny is amazing! To buy the equivalent goods with one 1797 penny in 1998 would cost 6,829 pennies (Au $139.23) - even more in 2008 money as inflation is accelerating fast! (Source: House of Commons research paper 03/82 11th November 2003)
    This valued a metric ton (32,150 troy ounces) of copper in 1797 at 223.26 pounds. Inflation adjusted for 1998 this equates to 1,524,642 pounds or Au $3,106,556 per ton. This start to make the current price of copper look cheap at around Au $9,000 per ton.

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    Notes:
    1. In 1797 there were 144 pennies to a pound this changed to 100 pennies to a pound in 1970
    2. The 1797 price per ton is calculated by dividing 32,150 ounces by 144 pennies.
    3. The inflation-adjusted price is calculated by multiplying the 1797 ton price by 6,829, the inflation adjusted price as per House of Commons research.
    4. Currency exchange rates as of 20th May, 2008.
     
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  3. jeankay

    jeankay Coin Hoarder

    Now that is a nice bit of history!

    Thank You.

    jeankay
     
  4. scottishmoney

    scottishmoney Bammed

    Lovely penny, and interesting dimension on a penny that really did change British history in many ways. In studying coinage circulation patterns in Scotland during the 1840's, it was determined that the 1797 penny still then represented over 40% of the circulating pennies in circulation, followed by the 1806 and then and only then the 1830's on up.

    It may have been different in Oz, but in Britain there were 240 pennies to the £, and 252 to the Guinea.
     
  5. ozcopper

    ozcopper Junior Member

    Thanks for the info.. Here in Australia it was 144, but if it is 240 in Britian, that would throw out my calculations.
     
  6. scottishmoney

    scottishmoney Bammed

    It would not have been without precedent, in all of the islands, ie Isle of Man, Guernesy and Jersey and even Ireland the penny had a different value in relation to British sterling. This was to keep the coins local, and prevent them from being exported back to Britain. Australia probably went to the 240:1 about the time of the gold rush there in the 1850's.
     
  7. Daggarjon

    Daggarjon Supporter**

    nice bit of history, and cool coin! thanks :)
     
  8. Ardatirion

    Ardatirion Où est mon poisson

    Good write up. I had also heard that King George insisted on these coins in his insanity. Of course, I haven't any way to cite this and regard it as little more than rumor.
     
  9. acl864

    acl864 Senior Member

    Interesting reading and cool coin. Thanks for posting.

    Andy
     
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