WELCOME TO THE BULLION VAULT, UK BANKNOTE BUREAU : Centennial of German Hyperinflation Series
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ONE INVESTMENT UNIT = 1 Authentic 'Kempden' 100 Billion Mark Vintage Note: Verified and sealed for protection and posterity
Vintage, Collectors' Item Banknotes. Astonishingly fine condition for being already 100 years old. Note dated and printed, Kempden 1923. Reichsbanknote-DEU. Germany. V RARE. And becoming RARER.
Photo is of the note on offer. As UK specialists in Weimar Hyperinflation Currency, and being TOP Rated eBay Sellers, we guarantee your note as authentic. Condition is fairly judged as VERY FINE.Wonderful Investment Potential! This note has NEVER reduced in value over the past century, always INCREASED.
WE BRING YOU THIS COMMEMORATIVE NOTE TO MARK THE CENTENARY OF THE PERIOD OF THE GREAT GERMAN HYPERINFLATION. AND, HOPEFULLY, TO LEARN FROM IT. From 1921 to 1924 the German people lived through the worst (and first) case of financial HYPERINFLATION ever seen in history. Over the short period of three years, paper money quite literally became worth less than the paper it was printed on. To date, the world has experienced 65 crisis cases of FIAT paper money currency (that is, paper money not backed by any tangible asset such as silver or gold) hyperinflation. The financial calamity that struck Germany in the 1920s was the first.One contemporary newspaper (1923) told the story of a Berlin woman queuing to buy bread. With her, she had a wheelbarrow full of notes to pay for her family's daily loaf. Distracted by something for barely a moment, she then looked down in horror to see that some scoundrel had her tipped her notes on to the rain-soaked ground and made-off with her wheelbarrow.
To put it in context, the value of the mark diminished at a faster rate than ever previously witnessed in the history of paper money. A loaf of bread in Berlin that cost around 160 Marks at the end of 1921 cost 200,000,000,000 Marks by late 1923.
Hyperinflation affected the German Papiermark, the currency of Germany, between 1921 and 1924, primarily in 1923. It caused considerable internal political instability in the country, the occupation of the Ruhr by France and Belgium as well as misery for the general populace.
Could this happen again? Yes! There is no reason whatsoever that an event such as this could not re-occurr It happened in Hungary in 1946. In fact, we have in more recent years seen RUNAWAY hyperinflation in Zimbabwe, the former state of Yugoslavia, Venezuela and a host of other countries.
FOR THE ECONOMISTS OUT THERE:
The cause of the immense acceleration of prices seemed unclear and unpredictable to those who lived through it, but in retrospect, it was relatively simple. The Treaty of Versailles imposed a huge debt on Germany that could be paid only in gold or foreign currency. With its gold depleted, the German government attempted to buy foreign currency with German currency equivalent to selling German currency in exchange for payment in foreign currency, but the resulting increase in the supply of German marks on the market caused the German mark to fall rapidly in value, which greatly increased the number of marks needed to buy more foreign currency.
That caused German prices of goods to rise rapidly, increasing the cost of operating the German government, which could not be financed by raising taxes because those taxes would be payable in the ever-falling German currency. The resulting deficit was financed by some combination of issuing bonds and simply creating more money, both increasing the supply of German mark-denominated financial assets on the market and so further reducing the currency's price. When the German people realized that their money was rapidly losing value, they tried to spend it quickly. That increased monetary velocity caused an ever-faster increase in prices, creating a vicious cycle.
The government and the banks had two unacceptable alternatives. If they stopped inflation, there would be immediate bankruptcies, unemployment, strikes, hunger, violence, collapse of civil order, insurrection and possibly even revolution. If they continued the inflation, they would default on their foreign debt.
However, attempting to avoid both unemployment and insolvency ultimately failed when Germany had both. This was the calamity that allowed a lunatic fringe to fester and spread. In Germany, it was to take sinister form in the rise of Adolf Hitler
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