These are five of the six kinds of currency in circulation prior to FDR*. Although readily interchangeable for each other, each one really was different. Two of them were anchored in value, because they backed by a coin or block of metal of similar value. In truth, they were a receipt for ownership of that coin or hunk of metal. Therefore it was a "Certificate" of ownership. It was easier to carry and readily transfer the receipt than it was the metal itself. The other bills were promises. "We don't have it right now, it is tied up in other things - i.e. loans or property, but we can get you some metal. Hence it was a promissory note - a United States Note, or a Federal Reserve Note. The last is National Currency. This is a place-holder -- i.e. "We not only don't have it in metal right now, but we don't even have it on loan right now. We will get you some eventually". The purpose is to keep commerce moving. Since "A" will work for "B" and "B" will sell to "C" who will sell to "A" all we need is a barter ticket to keep track of the motion.It self-proclaims that it is exchangeable for "Lawful Money". Ipso Ergo, it is "Unlawful Money".
They were all interchangeable, as was the silver dollar that was really a measured amount of silver (until C. Douglas Dillon, President Lyndon B. Johnson's Secretary of the Treasury ceased redemption in March 1964). Gradually, these bills all have been removed from use, leaving only the Federal Reserve Note in circulation.
To quote the U.S. Department of the Treasury web site, "the [Federal Reserve] notes have no value for themselves, but for what they will buy. In another sense, because they are legal tender, Federal Reserve notes are "backed" by all the goods and services in the economy." Because that is neither a fixed amount nor relationship, the value is free-wheeling.
But do note that that full faith and credit never seem to work in the public's favor. That 10 cent Pepsi, now a dollar-thirty-nine
-- it wasn't the Pepsi that changed.
*The sixth was the National Bank note or "hometown note" issued by national banks (First National Bank of [Your-town here]) under authority of the Federal Reserve system.
