What significant monetary principle was established by the Public Credit Act of 1869?

The Public Credit Act of 1869 established the principle of repayment of government bonds in gold. This was a significant shift in U.S. monetary policy, as it aimed to enhance the government's credibility and strengthen trust in U.S. financial obligations. By committing to pay back debts in gold, the act sought to stabilize the economy following the Civil War, which had caused considerable financial instability. This decision was intended to reassure investors and the public that the government would honor its debts, thereby fostering a more stable financial environment.

While other monetary principles, such as income tax implementation or backing currency by silver, were important in different contexts, they were not central to the intentions or provisions of the Public Credit Act. The focus on gold repayment was specific to addressing the need for fiscal responsibility and establishing a reliable standard for the value of currency in the aftermath of the war.