I was going through the collection of paper money that my dad brought back from Europe after World War II. Most of the bills are dated between 1917 and 1924, and includes currency from France, England, Belgium, Germany, and Poland. Only a few are from the war years, and I found only one that includes a swastika.
The Treaty of Versailles was signed to end World War I, and it was brutal in what it expected from Germany. It divided up land, reset boundaries, gave away industries, set the maximum size of any future Germany army, and had a lengthy list of other demands, most of which were aimed at making sure that Germany could never again have the military, industrial, or economic strength to wage another war.
The Allies also demanded that Germany pay for the war. In April, 1921, the reparations bill was assessed at $33 billion, which was a staggering sum at the time. Walther Rathenau had become Minister of Reconstruction and it was his unlucky job to find a way for Germany to make the payments.
Unfortunately, in June 1922, Rathenau was assassinated. The day he died, the Mark fell to 300 per U.S. dollar. A month later, when the first reparation payments were due, it had fallen to 500 per dollar. By late October, 1922, when the second payments were due, it had collapsed to 4500 per dollar.
By April, 1923, inflation had become hyperinflation and by November, it took twelve trillion German Marks to buy a U.S. dollar. In 1921 there were 120 billion Marks in circulation; Two years later, there were nearly five hundred million trillion Marks in circulation.
The cost of an egg was five hundred thousand million times more that it had been in 1918. A five hundred million Mark note (pictured above, along with a million Mark note, a 50 Mark note, and 10 pfennige note) might buy a loaf of bread. People were known to carry their money in wheelbarrows, looking to exchange their notes for higher denominations, and it was not unusual to find people burning their bills in furnaces to heat their houses.
Another feature of the era was that since most of the centralized government of German had been dis-empowered significantly, major cities printed their own currency. In the bills in the picture (there are two pictures on the website that show 4 bills), two were printed in Berlin in 1923, one in Munich in 1920, and I can’t make out where the 10 pfennige (that’s a penny; the note is the equivalent of a dime) was printed in 1917.
The point is, Germany after World War I felt that the only recourse to increasing the economy was to print more money. It wasn’t until the Weimar government appointed a Commissioner of Currency in 1923 that things got better. He introduced a new currency, the Rentenmark, with an exchange rate of one trillion old Marks to one new Rentenmark, declared it the national currency, and then had it guaranteed by the government. The hyperinflation disappeared very rapidly, within months, and Germany was brought into a workable system.
Most of this information comes from Germany, Memories of a Nation, by Neil McGregor, printed in 2014.
Don Willerton has been a reader all his life and yearns to write words like the authors he has read. He's working hard at it and invites others to share their experiences.