DID
YOU KNOW SERIES (24): A “Hundert Mark”
(Hundred Mark) Reichsbanknote dated
1st November 1920 tells a tale of a time when hyperinflation was rampant in Germany
after World War I :
Reichsbank (meaning the “Empire’s
Bank”):
The Reichsbank was founded on 01.01.1876 shortly after the
establishment of the German Empire in 1871.
It was the Central Bank of Germany from 1876
to 1945. It was privately owned by the Central Bank of Prussia, functioning
under the close control of the Reich Government.
Prior to its
establishment, there were 31 Central Banks or “Notenbanken” (Note Banks), functioning in each of the independent
states which were issuing their own money.
After the creation of the ReichsBank, four other “Notenbanken” still continued to function
till the beginning of World War I, i.e. till 1914. These were Baden,
Bavaria, Saxony and Wurttemberg.
German “Goldmark” Currency
(1873-1914):
Until World War I, the Reichsbank issued a stable currency
called the “Goldmark” (Between 1873
to 1914, the Mark was linked to gold with 2790 Mark being equal to I Kg. of
pure gold or 1 Mark being equal to 358 mg. of pure gold). Thus, “Goldmarks” were adequately backed by
gold reserves.
When the World War I broke
out, Germany delinked its currency convertibility from gold and funded the War
entirely by borrowing which led to a decline in the exchange value of the Mark.
The Mark which was earlier
formally backed by gold now evolved into the Papiermark (paper Mark) backed by nothing.
German
“Papiermark” Currency (1914-1923):
The term “Papiermark” (or “paper mark”) is used
for German currency when the link between the Goldmark and gold standard was abandoned due to the outbreak of
World War I.
Just before the World War
I, The State Loan Office began issuing paper money known as “Darlehnskassenscheine” (Loan Fund
Notes). These circulated alongside the issues of the Reichsbank. Most were in
the denominations of 1 and 2, but there were 5, 20, 50 and 100 Mark Notes also.
In addition to the issues
of the Government, emergency issues of tokens and paper money, known as “Kriegsgeld” (war money) and “Notgeld” (Emergency money) were produced
by local authorities.
“Notgeld/Grossgeld”:
“Not” means “Emergency or
necessity” while “geld” stands for “money”.
During World War I, money
was in short supply and there was rampant hoarding of gold and silver coins
across the countries of the World involved in the War effort.
Paper currency hoarding
too added to the shortage of money in circulation. Eventually, to overcome this
problem, the State Bank of Germany the “Reichsbank”)
permitted towns, villages and municipalities to issue their own currency. These
old Banknotes have over the years acquired a lot of collector interest.
Interestingly, apart from metal issues, Notgeld
was usually made of paper. Occasionally, it was issued in the form of card,
silk, linen jute, chamois leather, leather, aluminium foil, envelopes, velvet,
playing cards, compressed coal dust etc. Most Notgelds have the name of the town mentioned on them.
If, however, a German
Banknote had the word “Riechsbanknote”
printed on it, then it was issued by the State and is not a "Notgeld".
“Grossgeld” are any piece of Notgeld
having a face value of 1 Mark or more i.e. 1, 5, 10, 20, 50, 100 and 500 marks
etc. The Grossgeld Banknotes are much
larger than Serienscheine and Verkehrsausgaben issues but smaller than
very large inflationary issues.
Serienscheine:
Serienscheine (meaning
“Series Notes”) are a sub-set of “Notgeld”
and are the precursors to the famous German inflationary money of the early
1920s. These issues were beautiful, humorous and whimsical and conveyed a sense
of hope and stoic optimism designed to take the minds of the users away from
the miseries of the War they had gone through. The variety and beauty of these
Banknotes made them a desirable commodity. Collectors collected them in sets
which narrated stories and legends, which, in turn, led to the production of
many different issues and designs.
For example, in Hamburg town, there was a
story of Klaus Stoertbeker which is narrated on two Banknotes:
Klaus was a pirate in the
late 1300s and he and his crew were captured and brought to Hamburg and
sentenced to death by beheading. Before his execution, the story goes, that he
asked to be beheaded standing upright facing his pirate crew and that after his
head was cut off, as many of his pirate crew that his headless body walked past,
should be spared capital punishment. It is said that his headless body walked
past 12 of his crew and he only stopped walking because the executioner tripped
him. It is another matter that his crew were executed anyway.
Collectors are on the
lookout for entire Series which narrate stories like this one.
Verkehrsausgaben:
These are Notgeld issues that were put into
circulation because of the shortage of small change (metal coinage).
Weimar
Republic (Weimarer Republik):
This is the name given to
the Federal Republic and semi-Presidential representative democracy established
in 1919 in Germany to replace the Imperial form of Government after Germany’s
defeat in World War I.
It is named Weimar after the city where the National
Assembly took place in 1919 which adopted a new constitution for the German
Reich. However, most Germans continued to refer to their Nation the “Deutsches Reich”.
In its 14 years of
existence, the Weimar Republic faced numerous problems, including
hyperinflation, political extremism and contentious relationships with the
victors of World War I. Nevertheless, the Weimar Republic successfully reformed
the currency, unified tax policies and the Railway system and met most of the
requirements of the Treaty of Versailles, except for meeting the disarmament
requirements and eventually paid a small portion of the total reparations
required by the Treaty.
Decline of the “Papiermark”:
The Treaty of Versailles
accelerated the decline of the Mark. By end 1919, around 6.7 Papiermarks were
required to buy a US dollar.
The Allied nations in
World War I imposed heavy war reparation payments on Germany which were
mentioned to be paid in “Goldmarks”
in 1921, 1929 and 1931, as the Allies feared that a defeated
Germany might try to pay off the obligation in Papiermark.
Because
reparations were required to be paid in hard currency and not the rapidly
depreciating Papiermark, Germany adopted a strategy to bulk print Banknotes to
buy foreign currency at any price, for paying out reparations, which led to a
free fall in the value of the Papiermark and rampant inflation/hyperinflation
and ultimate collapse of the German Mark.
By the first half of
1921, the German Mark fell to about 60 to a US dollar. Despite this, the
German industry was intact and there were indications that the German economy
had withstood the effects of the War rather well.
In May 1921, the “London
Ultimatum” required Germany to pay reparations in gold or foreign currency
in annual instalments of 2 billion goldmarks (total of 132 billion Goldmarks) along with 26% of the value
of German exports.
After making the first
payment in June 1921, the Mark began its free fall with about 330 Marks
being the exchange value to a US dollar.
Hyperinflation followed
and cart-fulls of money could hardly buy groceries
Due to hyperinflation higher
denominations of Banknotes were issued by the Reichsbank and other institutions
like the Reichsbahn Railway Company in large numbers.
Before the War, the
highest denomination was 1000 Mark equivalent to about 50 British Pounds.
In early 1922,
10000 Mark notes were circulated, followed by 100000 and 1 million Mark notes
in February 1923. Later several denominations, the highest being 100
Trillion or 100,000 billion marks (Einhundert
Billionen Mark) which were equivalent in value to about 100 Rentenmark (the currency which
superseded the Papiermarks as a stop
gap arrangement , in November 1923, to contain the hyperinflation) were issued.
In January 1923,
French and Belgian troops occupied the Ruhr, the industrial region of Germany the
“Ruhrgebiet” (or the “Ruhr”) to
ensure that the reparations were paid in goods, viz., coal etc., as the Mark
had been rendered useless and Germany was in no position to pay its reparations
because of the rampant inflation.
The
hyperinflation in the Weimar Republic lasted from June 1921 to January
1924.
Introduction
of the “Rentenmark” as a stop-gap
currency (1923-1924):
The hyperinflation was at
its worst by November 1923.
The inflation began to
taper off only with the issue of the German Rentenmark
printed by the Deutsche Rentenbank, which
replaced the worthless papiermark on 16.11.1923.
The currency was
stabilised in November 1923 after the Rentenmark, was proposed to be issued, which came into circulation
in 1924. The Rentenmark replaced the Papiermark at an exchange rate of 1
trillion Papiermarks to 1 Rentenmark. Rentenmarks were issued in the denominations of 1, 2, 5, 10, 50,
100, 500 and 1000 dated 01.11.1923.
Around 500 million Rentenmarks dated 16.11.1923 were
put into circulation, with another 1 billion being circulated on 01.01.1924
and supplemented by 1.8 billion Rentenmarks
being added into circulation in July 1924. The exchange value of the
Rentenmarks was placed at 1 trillion Papiermark,
which still continued to be in circulation.
The hyperinflation of
Germany is akin to the Hyperinflation faced by the Hungarian pengo and the
Zimbabwean dollar which were even more inflated.
I have come across a similar story when I was
studying the currency of Zimbabwe which can be accessed at the following link:(How to join the super-rich Club? Own a Z$ 100 Trillion Banknote from Zimbabwe)
The
Reichsmark (1924-1948):
On 30.08.1924, the Reichsbank began issuing the Reichsmark which served as the currency
of Germany till 1948. This was meant to be a permanent replacement of
the Papiermark. The exchange rate of
the old Papiermark and the Reichsmark was set at 1 Reichsmark to 1 trillion Papiermark in UK and US English and 1 billion
Papiermark in German and other
European languages.
The Machtergreifung (or the “seizure of power”) by the Nazis in 1933
during the Third Reich led to the Reichsbank
falling under Government control in 1937, and in 1939, Adolf
Hitler assumed direct control of the Bank and the Bank was renamed as the “Deutsche Reichsbank”.
Following
the Nazi seizure of power in 1933, payments of reparations were officially
abandoned).
The Deutsche Reichsbank ceased to exist in 1945 after the defeat
of Nazi Germany and the last of the Reichsmarks
ceased to be legal currency in 1948, when the Deutsche Mark was introduced
in West Germany and the East German Mark in East Germany.
In West Germany, the
supervision of monetary policy fell upon the “Bank Deutscher Lander” (Bank of the German States) which, later,
became the “Deutsche Bundesbank”, while
the supervisory & control of monetary policy functions in East Germany fell
upon the “Deutsche Notenbank, later
the Staatsbank der DDR (State Bank of
the German Democratic Republic).
Description
of the 100 Mark Banknote of the German Reich
(Empire):
On the Front of this 100 Mark Banknote
one can see the following inscriptions in German:
“Reichsbanknote; Hundert Mark; ZAHLT DIE REICHSBANKHAUPTKASSE IN BERLIN,
GEGEN DIESE BANKNOTE DEM EINLIEFERER BERLIN, DEN 1, NOVEMBER 1920. Reichsbank
Directorium”.
The meaning of the above
inscriptions is: “Reichsbank note. One Hundred Mark. Reichsbank’s Head Cashier /Main Cash desk in Berlin will pay the
Bearer value against this Banknote, the Consignor. The 1st November
1920. Reichsbank’s Governing Body”.
On the upper and lower peripheries are mentioned “R.B.D.” (short for Reichsbank Directorium) and the Banknote’s Serial number: J7111289,
both in red colour.
“Reichsbanknote” is mentioned on the upper and lower peripheries as
well. On both sides of the Banknote is placed the Reichsbank Directorium’s seal bearing the Reichswappen (Reich Coat of Arms).
On the left and right
sides is shown the bust of a man facing right and left.
This bust has been variously
described as
a) Obverse: “Links en rechts mannenhoofd met muts” (meaning “and right (noble)
men, head with hat”.
b) Obverse: “Der Bamberger Reiter” in German (meaning “The Bamberg Horseman”).
The
Bamberg Horseman:
“Der Bamberger Reiter” in German (meaning “The Bamburg Horseman”) is
a life-size stone equestrian statue sculpted by an anonymous medieval sculptor
in the Cathedral of Bamburg, Germany, which dates back to around 1225 AD, which
places its creation to a period even before the Cathedral was consecrated in
1237.
The statue is located on a
console at the North pillar of the St. George’s choir and is that of a crowned,
but unnamed man.
It is believed to represent
a particular King of that period, perhaps one who was also a Saint. Historians
have narrowed down to Saint Henry II, who was a Holy Roman Emperor (973 to 1024
AD) and who was buried in the premises where the Cathedral was consecrated
along with Pope Clement II, but if this was so, he would have been depicted in
the imperial Regalia.
Perhaps, because he was of
a saintly disposition, he may have shunned Worldly trappings to be depicted in
his statue which was being sculpted for posterity.
Another person
who this statue could represent was Holy King Stephen I of Hungary (975-1038
AD) who is portrayed as stopping by on his horse for looking towards the tomb
of Saint Henry II.
A third version
suggests that this statue represents Frederick II, the Holy Roman Emperor at
the time, who is said to have financed much of the rebuilding of the cathedral.
A fourth version
holds that the figure represents the Messiah according to the Book of
Revelation.
Anyone
with any other “plausible” version is welcome to contribute his/her version.
Interestingly, Adolf
Hitler’s would-be assassin Colonel Claus Schenk Graf von Stauffenberg was a
member of the Bavarian Cavalry unit, the “Bamberger
Reiter – und Kavallerieregiment 17” (meaning the “17th Cavalry
regiment of the Bamberger Horsemen”).
The
20th July 1943 plot known as “Operation Valkyrie” (a Hollywood movie
was also made by that name) to assassinate Hitler was unsuccessful (four
persons were killed and several injured), but Hitler got saved from the blast
by a heavy solid oak conference table-leg which absorbed most of the splinters
of the explosion near him. The Colonel was executed by a firing squad on 21st
July 1943.
On the Reverse of the Banknote, we find
the value of the Banknote “100” mentioned in bold in the centre with the
letters “R.B.D.” (initials for “Reichsbank Directorium”) mentioned on top and
“Mark” mentioned below the figure. Around the oblong periphery of the
inscription in the centre is mentioned in German, starting from the left, the
inscription:
“Wer
Banknoten nachmacht oder verfalscht, oder nachgemachte oder verfalschte sich
verschafft und in Verkehr bringt, wird mit Zuchthaus nicht unter zwei Jahren
bestraft”.
The meaning of the above
inscription in German is:
“Anyone who copies or
counterfeits or obtains and puts into circulation copied or counterfeited
banknotes will be punished with not less than two years of penitentiary
(imprisonment)”.
The figure “100” is
mentioned in the four corners as well. The description of this face is “Waarde in Cijfer” (meaning “Value
figure”).
The
Specifications of this Banknote are:
Name of series:
70
Publisher:
Reichsbank Hauptkasse Berlin; Authority: Reichsbank Direktorium, Berlin;
Country: Germany; Denomination: 100; Currency: MARK; Type:
Grossgeld; Material: Paper; Width:
107 mm; Length: 161 mm; Thickness (when placed flat on the
table): 1 mm; Banknote issue date: 01.11.1920. Series Name:
Weimar Republic 1920 issue.
(The previously circulating 07.02.1908 Series, i.e. before World War I,
had security threads in it, but this Series was issued on plain paper only
because of the enormous volumes that it was printed in).
The
hyperinflated worthless papiermarks are a collector’s item today:
Interestingly, even
worn-out pieces of this Banknote are much sought after, as possessing each one
of these pieces is like holding a valuable piece of history and time travelling
back to the period in the aftermath of the World War I, in Germany.
If
only these pieces of Banknotes could talk and narrate a story what a
fascinating tale that would be.
Nevertheless,
while holding this piece in my hand, I felt like I had, indeed, time travelled back and “visualised an
exciting tale” which this Banknote had witnessed of German history being
written first hand as it passed from hand to hand!!
The Official Coat of Arms of Germany:
The Republican Coat of Arms
was based on the German crest established by the Paulskirche movement, using the same charge animal, an eagle, in
the same colours (black, gold and red), but having one head instead of
two.
"Reichswappen" of Tobias Schwab
There were two designs
adopted in quick succession – one by Emil Doepler (12.11.1919), another
official “Reichswappen” (Reich Coat
of Arms) by Tobias Schwab (1928).
"Reichsschild" of Emil Doepler
Doepler’s design became
the “Reichsschild” (Reich’s
escutcheon) and was used as a pennant for government vehicles.
In 1950, the
Federal Republic of Germany adopted all the official symbols of the erstwhile
Weimar Republic - the Reichswappen
(Reich Coat of Arms), as well as, the Reichsschild
(Reich’s Escutcheon) and, also, the Reichsflagge
(Reich Flag).
Image of the Eagle taken on the Governmental Flag
The Coat of Arms of
Germany displays a black eagle with red feet, beak and a tongue on a yellow
field, blazoned:
“Or, an eagle displayed
sable armed beaked langued and membered gules”. This is the Bundesadler or “Federal Eagle”, formerly
the Reichsadler or the “Imperial
Eagle”.
This is the same as the
Coat of Arms of the Weimar Republic (in use from 1919-1935), which was adopted
by the Federal Republic of Germany on 20.01.1950. The current official design is
the one made by Tobias Schwab, introduced in 1928.
(This
Banknote has been contributed for my collection by Div Rakesh who was visiting
Pune, India from Berlin last week. Seeing my interest in Currencies of the World,
Div went out of his way, to an old currency/coinage market in Berlin to collect this piece
for me. I will be putting up separate posts on some coins which Div has also brought
for me).
Links:
Links to posts on Federal Republic of Germany issues and other posts on this blog:
For posts on COTY (Coin of the Year) winners since 2015 in a competition held by Krause Publications of Germany, please visit the following links: