Gresham, Sir Thomas (1519?-1579), an English merchant and financier, founded the Royal Exchange in London. He is famous for stating the economic principle now known as Gresham's law. This law states that "bad money drives out good." By this, Gresham meant that if two coins have the same purchasing power but differing values as metal, people will tend to hoard the more valuable coin, leaving the less valuable one in circulation.