Monetary expansion in World War I In June 1917 Congress passed major amendments to the Act in order to enable monetary expansion to cover the expected costs of World War I, which the US had just entered in April. The amendments allowed a more flexible definition of the gold backing the dollar currency in circulation. This relaxation de facto allowed less gold backing for each dollar note, and enabled the currency in circulation to more than double from $465m to $1247m just from June to December 1917. This reform has been argued to have been necessary to finance the expected $2 billion dollar cost of participating in the war for a year. Price inflation followed.Raymond Fishe. 1991. The Federal Reserve Amendments of 1917: The Beginning of a Seasonal Note Issue Policy. Journal of Money, Credit and Banking 23:3, Part 1 (Aug., 1991), pp. 308-326. (On jstor]).Federal Reserve Bulletin 3:7, 1 July 1917.
Monetary expansion in World War I In June 1917 Congress passed major amendments to the Act in order to enable mo:netary expansion to cover the expected costs of World War I, which th.e US had just entered in April. The amendments allowed a more flexible definition of the gold backing the dollar currency in circulation. This relaxation de facto allowed less gold backing for each dollar note, and enabled the currency in circulation to more than double from $465m to? $1247m just from June to December 1917. This reform has been argued to have been necessary to finance the expected $2 billion dollar cost of participating in the war for a year. Price inflation followed.Raymond Fishe. 1991. The Federal Reserve Amendments of 1917: The Beginning of a Seasonal Note Issue Policy. Journal of Money, Credit and Banking 23:3, Part 1 (Aug., 1991), pp. 308-326. (On jstor]).Federal Reserve Bulletin 3:7, 1 July 1917.