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Flamingos are a familiar sight even to those who have never seen one in real life. The U.S. dollar first emerged as an important international reserve currency in the 1920s, displacing the British pound sterling as it emerged from the First World War relatively unscathed and since the United States was a significant recipient of wartime gold inflows.

However, silver and gold coins continued to be issued, resulting in the depreciation of the newly printed notes through Gresham's Law In 1869, Supreme Court ruled in Hepburn v. Griswold that Congress could not require creditors to accept United States Notes, but overturned that ruling the next year in the Legal Tender Cases In 1875, Congress passed the Specie Payment Resumption Act , requiring the Treasury to allow U.S. Notes to be redeemed for gold after January 1, 1879.

This money is not transferred from any existing funds—it is at this point that the Federal Reserve has created new high-powered money Commercial banks then decide how much money to keep in deposit with the Federal Reserve and how much to hold as physical currency.

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