9 Oct. 1805
Observations on foreign gold
Congress omitted last year to renew the temporary laws by which, so much of the general act respecting foreign coins, as declares that no foreign gold or silver coin (spanish dollars excepted) shall be current after the mint shall have been in operation a certain time, had from time to time been suspended. It followed that foreign gold ceased on 1 May last to be a legal tender. At that time nine tenths of the circulating specie or of that in the vaults of the several Banks consisted of such gold. A letter was written to the Bank of the U.S. recommending the importation of dollars from Europe, and the coining, into American coins, the foreign gold in their possession. Their answer is enclosed, and it must be observed that the omission of Congress which was accidental has done as yet no injury; for as there was no other specie, every one by tacit consent has received & paid it as if it had been a legal tender.
The question which will arise on that subject is Ought Congress again make foreign gold a legal tender? and if so, should not something to be done on the subject of Spanish gold. To the first question I have no hesitation to answer in the affirmative. But the second is more difficult to solve. It is evident that through mistake we have by law rated Spanish gold coins above their value. English, & Portuguese coins are of the same standard with our own. French have been rated properly or rather a little too low
To continue to receive Spanish coins above their value is to persist in error.
To declare that they shall pass hereafter only at their real value, will throw a loss on the holders, and check the importation of that kind of species which in the coarse of trade is most easily obtained & chiefly supplies us.
To reduce our standard to the Spanish, raising of course the English, Portuguese & French gold coins to what would become their real value might properly be considered as an alteration of our coins.
DLC: Papers of Thomas Jefferson.