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German Currency Reform of 1948

fib1618

By fib1618,
in LOPster tank

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mcjocky1 Newbie

mcjocky1

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1930 to 1948 the German's monetary system was mainly overshadowed by the "black market" as prices and wages were quite strictly controlled by the Gov. The introduction of the "new" money from Reichsmark to Deutchmark at the exchange rate of 1 new for 10 old quit simply wiped out 90% of the Gov,t. debt but likewise reduced the value of private bank accounts by the same margin. The ammount of paper money held in private accounts had to be reduced to allow the new currency any hope of re-structuring the debt and start to build a firm monetary base. Remember the divide between the allies who controlled the East / West initially staggering the introduction of the new money within the portions that they controlled was not welcomed and caused some social reaction.

 I thought that it was quit simply a part of school history how Europe as a whole was burdened with the  cost of re building their countries infra structure, and not only at a cost to the German population either.

 The silver lining to every German was obviously a 90% reduction in any debt they had on the introduction of the Deutchmark.

 Xet, this is from memory without the need for copy and paste, I hope this meets your exacting standards my friend.      

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mcjocky1 Newbie

mcjocky1

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So this at last should take care for good of Germany being taken as a  great  example.

 Alas this to me just highlights the change in the content of what is now taught in schools today against what was deemed as "recent history" in the early 60's, indeed my own children think that my ( to me )somewhat basic knowledge on "the war" must mean that I am old enough to have taken part or at least lived through it.

 So with this in mind a degree of ignorance in this subject is to be expected I suppose.

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fib1618 Newbie

fib1618

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........................

Whats very clear to me with all the reading I've done on this subject is bank account holders effectively sacrificed some of their accumulated savings but the cancellation of debt allowed the economy to rebound more quickly and new savings were generated.

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fib1618 Newbie

fib1618

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......................

Where's that big rv????

http://www.sjsu.edu/faculty/watkins/germany.htm

.........................

........................

I have tons of material to go through Yet.......Maybe I'll stumble across it. Lol

Zzzzzzzzzzzzzzzzzzz

..........................

Don't let kraperoni kid you... This was just another friggin re-denomination.

Kuwait was a lie.

Germany was a lie.

Iraq is a lie.

Go rv!

:D

Edited by fib1618
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mcjocky1 Newbie

mcjocky1

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........................

Whats very clear to me with all the reading I've done on this subject is bank account holders effectively sacrificed some of their accumulated savings but the cancellation of debt allowed the economy to rebound more quickly and new savings were generated.

 Given that the "savings" were mainly accrued during 1930/1948 at a time when the worth of their paper money was inflated and you look at the street price on goods over the war period, it was a very effective strategy to reduce the value of the new currency. 

 Would this be a viable proposition for Iraq, as I believe this might be the way you are heading with this thread, we may find out "soon" lol.

 Don't waste your time looking for a German RV, as you say tons to get through and it will cover up to the introduction of the Euro, which by the way did not put a time limit on an exchange of Marks to Euro.

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umbertino Grand Master

umbertino

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When many EU Countries switched  from their respective  Nat'l currencies to the Euro the average citizens ( like myself) didn't gain anything.

It was a neutral event. The day before you had your Nat'l currency deposited in your Bank ( Italian Liras in my case) and the day after you'd have an x amount ( depending on the exchange rate of each currency..... for the Italian Lira it was 1,927.36  for 1 Euro) of Euros. Nothing gained.

Edited by umbertino
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mcjocky1 Newbie

mcjocky1

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Isn't that RV currently holding up the European economy, at least for now. Plus the mark increased significantly in value, whether it be RV, re-denomination, or whatever by 1960 I believe. Give or take a year or two.

 During the late 50's to early 60's the Deutche Bundesbank held the Mark at a pretty constant rate compared to the fluctuations in other European Countries, which in effect made it a sort of "safe haven" currency which in turn bolstered it's value by the amount of Marks bought and sold to support other ailing currencies through their lean times.

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zigmeister Newbie

zigmeister

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Doing a little study on the German Currency Reform of 1948. Discovering that people with savings in the banks actually LOST money. :D Looks like the gurus lied about this one as they did about Kuwait. Will post some of my findings as I get time.

Well poop!  I guess I better get a job dancing on a street corner with a sign, "Buy Gold here!"

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