In the pre-decimal British monetary system, the guinea was a coin that was minted in Great Britain between 1663 and 1813. It was originally made from gold imported from Guinea in West Africa, hence the name. The guinea had a nominal value of one pound sterling, but its actual value fluctuated over time relative to the pound. This has led to some confusion over how many guineas made up a pound. This article will provide a historical overview of the guinea and explain how its value related to the British pound.
Origins and specifications of the guinea
The guinea was introduced in 1663 during the reign of Charles II. It was made from gold imported by the Africa Company from Guinea in West Africa. The coin weighed 8.4-8.5 grams and was minted from 0.9167 fine gold. This means it was 91.67% pure gold. It was valued at 20 shillings or one pound sterling. However, market conditions and the fluctuating price of gold meant that the guinea’s value was often more or less than one pound.
The guinea coin showed the monarch on the obverse side. The reverse side depicted a shield and crown. The inscription read MAG BR FRA ET HIB REX date, signifying “King of Great Britain, France and Ireland.” Later guineas omitted the French claim.
The fluctuating value of the guinea
Although the guinea had a nominal value of one pound, its real market value varied. This was due to the expense of minting such a large gold coin, as well as fluctuating gold prices. During the 17th and 18th centuries, the value of the guinea oscillated between 20 and 30 shillings. At times it was worth more than its face value, while at other times it traded below the pound.
Here are some key points about the guinea’s changing value:
– Shortly after its introduction, the guinea was worth 22 shillings.
– In 1670, its value was officially set at 22 shillings by royal proclamation.
– During the Great Recoinage of 1816-1717, when Britain moved to adopt the gold standard, the guinea was pegged at 21 shillings.
– By 1717, it was worth 21 shillings and 6 pence. This was equivalent to 1.05 pounds.
– The value fell to 21 shillings by 1732.
– By the 1760s, it was fixed at 21 shillings again.
– In the last years of the guinea before it was demonetized in 1816, it traded for 27 shillings. This appreciated value was due to the scarcity of available gold coins, as well as inflation from the Napoleonic Wars.
So in summary, the guinea fluctuated above and below the pound, making it sometimes more or less valuable than its face value. Its changing value contributed to economic instability.
The guinea is demonetized
In 1816, Britain officially adopted the gold standard. This meant fixing the value of the pound to a specified amount of gold. As part of this monetary reform, the guinea coin was demonetized along with other irregular coins like the seven shilling piece.
The guinea was replaced by the sovereign, which was exactly one pound sterling. The sovereign was minted from 1817 onwards and remained in circulation until decimalization in 1971.
So in 1816, the relationship became formally fixed at:
– 1 pound = 20 shillings
– 1 guinea = 21 shillings
Therefore, after 1816 there were officially 21 shillings to a guinea. So the straightforward answer is that 1 guinea equaled 1.05 pounds after decimalization.
The guinea in accounting and trade
Although the coin itself was no longer minted or used after 1816, the unit of the guinea continued to be used as a monetary accounting unit. The guinea rating was applied to certain prices, such as professional fees, art, horses, land and other luxury items. Using guineas instead of pounds indicated a higher status or rate.
Here are some key points about the continued use of the guinea as a unit:
– Goods such as gold, gems, racehorses and art were often quoted in guineas rather than pounds after 1816.
– Professional fees, including that of lawyers and physicians, were often stated in guineas.
– The guinea became slang for a sum of money, as well as a metonym for wealth more broadly.
– Prices in guineas endured until decimalization of the pound in 1971. Auction houses like Christie’s and Sotheby’s priced items in guineas until the late 20th century.
– The guinea had prestige and reputation as a “gentlemanly” unit of accounting. Those who charged in guineas could claim higher status.
So while the literal 21-shilling guinea coin was no longer used, its legacy as a unit of account continued for over 150 years after its demonetization. One pound sterling was always equal to 20 shillings. But a “guinea” retained its higher value of 21 shillings when pricing exclusive goods and services.
Pricing conventions using guineas
Here are some examples of pricing conventions that were quoted in guineas:
– Horse racing and breeding: Racehorse prices were often specified in guineas. Stud fees and bets were also placed in guineas.
– Fine art and jewelry: Art auction houses listed prices in guineas into the 20th century. Diamond jewellery was also priced in guineas per carat.
– Land: When land was offered for sale, its price may have been quoted in guineas per acre or square foot. This conveyed prestige.
– Luxury goods: High-end tailored suits, watches and accessories could be priced in guineas rather than pounds.
– Fees for doctors, lawyers and other professionals: Doctors and dentists charged guineas for visits and procedures. Lawyers quoted retainers and contracts in guineas to signal expertise.
– Upscale events: Tickets to upper class sporting and cultural events were sometimes priced in guineas.
Using guineas raised the perceived value and prestige of transactions. So payments priced in guineas were 5% more than the equivalent pound price (at 21 shillings per guinea).
How many guineas were minted?
The guinea coin was minted regularly between 1663 and 1799. After 1799, new guinea coins were only sporadically minted, with the last guineas minted in 1813 bearing the “military” portrait of King George III.
In total, it’s estimated that approximately 388 million guinea coins were minted over this period. However, many of the coins were melted down or restruck as gold prices fluctuated. Coins from some years, such as the rare 1701 guinea from when Britain moved to the gold standard, are now quite valuable to collectors.
Here is a breakdown of approximately how many guineas were minted in total, and during key periods:
– 1663 to 1700 – Around 20 million
– 1701 to 1799 – Around 200 million
– 1801 to 1813 – Around 168 million
So from the guinea’s origins in 1663 to its last minting in 1813, the Royal Mint produced close to 388 million coins. The guinea had a long period of uninterrupted production from 1701 to 1799.
While hundreds of millions of coins were produced, the guinea is quite scarce today. Fewer than 200,000 are estimated to survive in collections or museums worldwide. After Britain went on the gold standard in 1816, many were melted down and restruck into sovereign coins. Their large gold content gave guineas high intrinsic value aside from their status as historical coins.
How guineas related to other pre-decimal coins
To fully understand how many guineas constituted a pound, we should look at how the guinea compared to other denominations in the pre-decimal British monetary system:
– 1 guinea = 21 shillings
– 1 pound = 20 shillings
– 1 crown = 5 shillings
– 1 half-crown = 2 shillings and 6 pence (2/6)
– 1 shilling = 12 pence (12d)
So while the pound, crown and half-crown were worth set amounts of shillings, the guinea was an irregular denomination worth 21 shillings.
The guinea also had a fixed relationship to several lesser coins based on its 21 shilling value:
– 1 guinea = 252 pence (21 shillings x 12 pence per shilling)
– 2 guineas = 42 shillings
– 5 guineas = 105 shillings
Below the shilling, coins like the sixpence (6d), threepence (3d) and penny (1d) had set conversions into pence.
So in summary, it took 252 pence or 21 shillings to equal 1 gold guinea. This could be contrasted to the pound’s lower value of 240 pence or 20 shillings. The guinea’s odd 21 shilling rating persisted even after the coin itself was demonetized.
When were guineas discontinued?
The guinea coin ceased being minted in 1813. But for more than a century after that, the unit of the guinea itself remained in use for pricing luxury goods, fees, assets and other exclusive transactions.
Here is a timeline showing when the guinea was discontinued in different areas:
– 1816 – The guinea coin demonetized as part of Britain’s return to the gold standard.
– Early 20th century – Auction houses like Sotheby’s and Christie’s gradually switch pricing from guineas to pounds.
– 1954 – The Honourable Society of the Inner Temple switches from pricing legal fees in guineas to pounds. Other legal and professional organizations follow suit.
– 1958 – Racehorse auctions in Britain stop using guineas and list prices in pounds.
– 1970s – As decimalization looms, most remaining guinea pricing is dropped. The Stock Exchange switches to pricing stocks in pounds.
– 1971 – Britain decimalizes its currency, replacing pounds, shillings and pence with a new 100 pence to the pound. Guinea pricing disappears almost entirely.
So by 1971 when pounds and new pence replaced old pounds, shillings and pence, the guinea had faded into history aside from occasional nostalgic commercial usage. The legacy of the guinea coin itself had ended 157 years earlier in 1813. But its status as a prestigious unit of account persisted until modern times.
Conclusion
In conclusion, the exact number of guineas to the pound varied throughout the guinea’s history from the 17th to 19th century. This was due to fluctuating gold prices and minting costs that caused the guinea coin’s market value to diverge from its intended pound valuation.
After Britain adopted the gold standard in 1816, the value of the pound became permanently fixed. From 1816 onwards:
– 1 pound = 20 shillings
– 1 guinea = 21 shillings
So technically, 1 pound was equal to 0.95238… guineas after decimalization. Approximately 1.05263 guineas made up one pound.
However, the legacy monetary unit of the guinea lived on as 21 shillings in select pricing contexts for exclusive goods and services. So customers paying fees or buying luxury items in guineas after 1816 were paying around 5% more than the pound price.
In total, around 388 million gold guinea coins were minted during the coin’s lifespan from 1663 to 1813. But its irregular shilling value compared to the pound, and fluctuating gold price, contributed to economic problems that led Britain to decimalize its currency. The unusual tale of the guinea provides insight into the complexities of pre-decimal British money.
