You may or may not be aware that the British only started using decimal money in 1972. That is, their money is now based on the pound, which is divided into 100 pennies or pence (in America it is cents - there is no such thing as an American penny). These new pence or nuppence were not valued the same as the previous coin of the same name. No, not by a long shot ...

If you're wondering "what kind of money did they have before then, if it wasn't decimal?" well, they had funny money.

The British money system, like all other money systems in times of yore, was based on metal. Coins were valued according to their metal content, gold being worth the most, then silver, then bronze or copper (considering the quality of copper refining back then, these last are essentially the same thing).

Most countries based their monetary units on gold or silver: the basic unit was a fixed amount of one of those metals, and the other coins were rated as fractions or multiples of it (bear in mind that paper money is a recent development; we're only talking about coins here). This held true even if these other coins were made in the other precious metal, which caused a lot of problems when the value of, say, an ounce of silver rose above the exchange value of that country's 1-ounce silver coin. If they used less siver, their money lost its value; if they didn't, their coins were melted down for their silver content. Fixed exchange rates between gold and silver, or bi-metallism, always caused trouble.

So, what did the British do? They used three metals, of course.

Britain, unique in the World, had a tri-metallic system, in which gold, silver and copper were fixed in value to one another. To say this was awkward is an understatement. Every few years or so the Crown had to revalue its coinage - not the arbitrary fiat value of the coins, but the amounts of metal in them. Worse, there was no logical ratio of one coin to another. The sizes and values of British coins and their exchange rates were a matter of tradition, not to be changed no matter how dumb it was. Here's how it worked:

                  |----------SILVER-------------------|          
          |---------GOLD-------------|           |----COPPER----|
-----------------------------------------------------------------
          GUINEA  POUND  CROWN  FLORIN  SHILLING  PENNY  FARTHING
  GUINEA =   1     1.05   4.2    10.5      21      252     1008  
   POUND =          1      4      10       20      240      960  
   CROWN =         0.25    1      2.5       5       60      240  
  FLORIN =         0.10   0.40     1        2       24       96  
SHILLING =         0.05   0.20    0.5       1       12       48  
   PENNY =                                           1        4  
FARTHING =                                         0.25       1  
-----------------------------------------------------------------

Notice the overlap. There were gold and silver florins, crowns and pounds, and silver and copper pennies; at least shillings were always silver. The guinea had been a coin in the 17th and 18th centuries, but it was later used only as a unit of account. It was purposely made only 5% larger than the pound, so merchants could value things in guineas and thus gouge their customers.

If you loook at the pound column, you can see an inkling of the American system:

    U.K.    %     U.S.  
------------------------
   POUND = 100 = DOLLAR 
   CROWN =  25 = QUARTER
  FLORIN =  10 = DIME   
SHILLING =   5 = NICKEL 
   PENNY =   1 = CENT   
------------------------

When the Brits inevitably converted to decimal, all the old coins were honored at the new rate of exchange - that is old pence, once worth 1/240 pound, could be spent at 1/100 pound, just like the new ones. It made the transition a lot easier.

For the record, American money hasn't been entirely logical. Ever heard the expression, "queer as a $3 bill?" Well, there used to be not only $3 but $4, $6, $7, $8, $9 and even $12 bills before the Civil War, when all paper money was privately issued. I've never seen an $11 bill, but I'd believe one existed. Even the Feds are not immune to funny money. They've issued half-cents, 20-cent pieces (simltaneously with quarters) microscopic $1 gold coins, dinky little fractional paper notes, and more. There was a $4 gold coin designed to make U.S. money compatible with the Latin Monetary Union of Europe, but it never caught on. Also, for over two decades the U.S. mint made $3 gold coins. Why? Bercause postage stamps were 3 cents and were sold in sheets of 100 - you figure it out ...