The Deutsche Mark (German pronunciation: [ˈdɔʏtʃə ˈmaʁk], German mark Mark was a measure of weight (see mark (mass)) mainly for gold and silver, commonly used throughout western Europe and often equivalent to 8 ounces. Considerable variations, however, occurred throughout the Middle Ages (see du Cange, Gloss. med. et infim. Lat., s.v. Marca for a full list)) was the official currency In economics, the term currency can refer to a particular currency, for example Pound Sterling, or to the coins and banknotes of a particular currency, which comprise the physical aspects of a nation's money supply. The other part of a nation's money supply consists of money deposited in banks , ownership of which can be transferred by means of of West Germany West Germany is the common English name for the Federal Republic of Germany or FRG (German: Bundesrepublik Deutschland) in the period between its formation in May 1949 to German reunification on 3 October 1990. This period, during which Germany and Berlin were divided, ended when communist East Germany was dissolved and its five states joined the (1948–1990) and Germany A region named Germania, inhabited by several Germanic peoples, has been known and documented before AD 100. Beginning in the 10th century, German territories formed a central part of the Holy Roman Empire, which lasted until 1806. During the 16th century, northern Germany became the centre of the Protestant Reformation. As a modern nation-state, (1990–2002) until the adoption of the euro The euro is the official currency of the eurozone: 16 of the 27 Member States of the European Union (EU). It is also the currency used by the EU institutions. The eurozone consists of Austria, Belgium, Cyprus, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain. Estonia is in 2002. It is commonly called the "Deutschmark" in English but not in German. It was first issued under Allied occupation The Bizone, or Bizonia, was the combination of the American and the British occupation zones during the occupation of Germany after World War II. With the addition of the French occupation zone on 8 April 1949, the entity became the Trizone or Trizon(es)ia. Six weeks later, on May 24, the trizone became the Federal Republic of Germany (commonly in 1948 replacing the Reichsmark The Reichsmark was the currency in Germany from 1924 until June 20, 1948. The Reichsmark was subdivided into 100 Reichspfennig, and served as the Federal Republic of Germany A region named Germania, inhabited by several Germanic peoples, has been known and documented before AD 100. Beginning in the 10th century, German territories formed a central part of the Holy Roman Empire, which lasted until 1806. During the 16th century, northern Germany became the centre of the Protestant Reformation. As a modern nation-state,'s official currency from its founding the following year until 1999, when the Mark was replaced by the euro The euro is the official currency of the eurozone: 16 of the 27 Member States of the European Union (EU). It is also the currency used by the EU institutions. The eurozone consists of Austria, Belgium, Cyprus, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain. Estonia is; its coins Coins are usually metal or a metallic material and sometimes made of synthetic materials, usually in the shape of a disc, and most often issued by a government. Coins are used as a form of money in transactions of various kinds, from the everyday circulation coins to the storage of large numbers of bullion coins. In the present day, coins and and banknotes A banknote is a kind of negotiable instrument, a promissory note made by a bank payable to the bearer on demand, used as money, and in many jurisdictions is legal tender. Along with coins, banknotes make up the cash or bearer forms of all modern fiat money. With the exception of non-circulating high-value or precious metal commemorative issues, remained in circulation, defined in terms of euros, until the introduction of euro notes and coins in early 2002. The Deutsche Mark ceased to be legal tender Legal tender or forced tender is an offered payment that, by law, cannot be refused in settlement of a debt, and have the debt remain in force. Currency is the most common form of legal tender immediately upon the introduction of the euro—in contrast to the other Eurozone The eurozone ( pronunciation ), officially the euro area, is an economic and monetary union (EMU) of 16 European Union (EU) member states which have adopted the euro currency as their sole legal tender. It currently consists of Austria, Belgium, Cyprus, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, nations, where the euro and legacy currency circulated side by side for up to two months. DM coins and banknotes continued to be accepted as valid forms of payment in Germany until 28 February 2002.
The Deutsche Bundesbank The Deutsche Bundesbank is the central bank of the Federal Republic of Germany and as such part of the European System of Central Banks (ESCB). Due to its strength and former size, the Bundesbank is the most influential member of the ESCB. Both the Deutsche Bundesbank and the European Central Bank (ECB) are located in Frankfurt am Main. It is has guaranteed that all German mark in cash form may be changed into euros indefinitely, and one may do so at any branch of the Bundesbank in Germany. Banknotes can even be sent to the bank by mail.[1]
On 31 December 1998, the European Central Bank The European Central Bank is the institution of the European Union (EU) tasked with administrating the monetary policy of the 16 EU member states taking part in the Eurozone. It is thus one of the world's most important central banks. The bank was established by the Treaty of Amsterdam in 1998, and is headquartered in Frankfurt, Germany. The (ECB) fixed the irrevocable exchange rate, effective 1 January 1999, for German mark to euros The euro is the official currency of the eurozone: 16 of the 27 Member States of the European Union (EU). It is also the currency used by the EU institutions. The eurozone consists of Austria, Belgium, Cyprus, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, Malta, the Netherlands, Portugal, Slovakia, Slovenia and Spain. Estonia is as DM 1.95583 = €1.[2] One Deutsche Mark was divided into 100 Pfennig The Pfennig is an old German coin or note, which existed from the 9th century until the introduction of the euro in 2002.
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History
Before 1871
A Mark had been the currency of Germany since its original unification The formal unification of Germany into a politically and administratively integrated nation state officially occurred on 18 January 1871 at the Versailles Palace's Hall of Mirrors in France. Princes of the German states gathered there to proclaim Wilhelm of Prussia as Emperor Wilhelm of the German Empire after the French capitulation in the Franco- in 1871. Before that time, the different German states The States of the German Confederation were those member states that from June 20, 1815 were part of the German Confederation, which lasted, with some changes in the member states, until August 24, 1866, under the presidency of the Austrian imperial House of Habsburg, which was represented by an Austrian presidential envoy to the Federal diet in issued a variety of different currencies, though most were linked to the Vereinsthaler The Vereinsthaler was a standard silver coin used in most German states and the Austrian Empire in the years prior to German unification, a silver coin containing 16 2/3 grams The gram , (Greek/Latin root grámma); symbol g, is a unit of mass of pure silver. Although the Mark was based on gold rather than silver, a fixed exchange rate between the Vereinsthaler and the Mark of 3 Mark = 1 Vereinsthaler was used for the conversion.
1873–1948
The first Mark, known as the Goldmark Before unification, the different German states issued a variety of different currencies, though most were linked to the Vereinsthaler, a silver coin containing 16⅔ grams of pure silver. Although the Mark was based on gold rather than silver, a fixed exchange rate between the Vereinsthaler and the Mark of 3 Mark = 1 Vereinsthaler was used for, was introduced in 1873. With the outbreak of World War I World War I was a military conflict that lasted from 1914 to 1918 and involved most of the world's great powers, assembled in two opposing alliances: the Allies and the Central Powers. More than 70 million military personnel, including 60 million Europeans, were mobilized in one of the largest wars in history. More than 15 million people were, the Mark was taken off the gold standard. The currency thus became known as the Papiermark The name Papiermark is applied to the German currency from the point in 1914 when the link between the Mark and gold was abandoned, due to the outbreak of the First World War. In particular, the name is used for the banknotes issued during the hyperinflation in Germany of 1922 and especially 1923 (see Inflation in the Weimar Republic), which was a, especially as high inflation In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time. When the price level rises, each unit of currency buys fewer goods and services; consequently, inflation is also an erosion in the purchasing power of money – a loss of real value in the internal medium of exchange and unit, then hyperinflation The inflation in the Weimar Republic was a period of hyperinflation in Germany during 1921-1923 occurred and the currency became exclusively made up of paper money. The Papiermark was replaced by the Rentenmark The Rentenmark (RM) was a currency issued on 15 November 1923 to stop the hyperinflation of 1922 and 1923 in Germany. It was subdivided into 100 Rentenpfennig in late 1923 and the Reichsmark The Reichsmark was the currency in Germany from 1924 until June 20, 1948. The Reichsmark was subdivided into 100 Reichspfennig (RM) in 1924.
Currency reform of June 1948
The Deutsche Mark was introduced on Sunday, June 20, 1948 by Ludwig Erhard Ludwig Wilhelm Erhard was a German politician (CDU) and Chancellor of West Germany from 1963 until 1966. He is notable for his leading role in German postwar economic reform and economic recovery, particularly in his role as Minister of Economics under Chancellor Konrad Adenauer after 1949. He did this, as he often confessed, on Sunday because the offices of the American, British, and French occupation authorities were closed that day. He was sure that if he had done it when they were open, they would have countermanded the order. The old Reichsmark and Rentenmark were exchanged for the new currency at a rate of 1 DM = 1 RM for the essential currency such as wages, payment of rents etc, and 1 DM = 10 RM for the remainder in private non-bank credit balance, with half frozen. Large amounts were exchanged for 10RM to 65 pfennigs. In addition, each person received a per capita allowance of 60 DM in two parts, the first being 40 DM and the second 20 DM.[3]
The introduction of the new currency was intended to protect western Germany from a second wave of hyperinflation In economics, hyperinflation is inflation that is very high or "out of control", a condition in which prices increase rapidly as a currency loses its value. Definitions used by the media vary from a cumulative inflation rate over three years approaching 100% to "inflation exceeding 50% a month." In informal usage the term is and to stop the rampant barter and black market In modern societies the underground economy covers a vast array of activities. It is generally smaller in countries where economic freedom is greater, and becomes progressively larger in those areas where corruption, regulation, or legal monopolies restrict economic activity in various goods, services, or trading groups.[citation needed] trade (where American cigarettes acted as currency). Although the new currency was initially only distributed in the three western occupation zones outside Berlin, the move angered the Soviet The Union of Soviet Socialist Republics (USSR, Russian: Союз Советских Социалистических Республик, tr. Soyuz Sovetskikh Sotsialisticheskikh Respublik IPA: [sɐˈjus sɐˈvʲeʦkʲɪx səʦɨəlʲɪˈstʲiʨɪskʲɪx rʲɪsˈpublʲɪk] , abbreviated СССР, SSSR), informally known as the Soviet Union (Russian: authorities, who regarded it as a threat. The Soviets promptly cut off all road A road is an identifiable thoroughfare, route, way or path between two places which may or may not be available for use by the public; public roads, especially major roads connecting significant destinations are termed highways. Modern roads are normally smoothed, paved, or otherwise prepared to allow easy travel although historically many roads, rail Rail transport is the means of conveyance of passengers and goods by way of wheeled vehicles running on rail tracks. In contrast to road transport, where vehicles merely run on a prepared surface, rail vehicles are also directionally guided by the tracks they run on. Track usually consists of steel rails installed on sleepers/ties and ballast, on and canal Smaller transportation canals can carry barges or narrowboats, while ship canals allow seagoing ships to travel to an inland port , or from one sea or ocean to another (e.g.: Caledonian Canal, Panama Canal) links between the three western zones and West Berlin – starting the Berlin Blockade The Berlin Blockade was one of the first major international crises of the Cold War and the first resulting in casualties. During the multinational occupation of post-World War II Germany, the Soviet Union blocked the Western Allies' railway and road access to the sectors of Berlin under Allied control. Their aim was to force the western powers to. In response the United States distributed the new currency in West Berlin West Berlin was a political exclave that existed between 1949 and 1990. It comprised the western regions of Berlin, which were bordered by East Berlin and parts of the German Democratic Republic. West Berlin consisted of the American, British, and French occupation sectors, which had been established in 1945. It was politically closely affiliated as well.
Currency reform in the Soviet occupation zone
In the Soviet occupation zone The Soviet Occupation Zone (German: Sowjetische Besatzungszone or Ostzone; Russian: Советская зона Германии, Sovetskaya zona Germanii, "Soviet Zone of Germany") was the area of central Germany occupied by the Soviet Union from 1945 on, at the end of World War II. On 7 October 1949 the German Democratic Republic, of Germany (later the German Democratic Republic The German Democratic Republic - GDR was the socialist state established in 1949 in the Soviet zone of occupied Germany and in the East Berlin portion of the Allied-occupied capital city. The German Democratic Republic, which consisted geographically of northeast Germany rather than all of eastern Germany, had an area of 107,771 km2. (41,610 mi.2),), the East German Mark The East German mark commonly called the eastern mark (Ostmark in West Germany and after the reunification), in East Germany only Mark, was the currency of the German Democratic Republic (East Germany). Its ISO 4217 currency code was DDM. The currency was known officially as the Deutsche Mark from 1948 to 1964, Mark der Deutschen Notenbank from 196 (also named "Deutsche Mark" from 1948–1964 and colloquially referred to as the Ostmark) was introduced a few days afterwards in the form of Reichsmark and Rentenmark notes with adhesive stamps to stop the flooding in of Reichsmark and Rentenmark notes from the West. In July 1948, a completely new series of East German Mark banknotes were issued.
Bank deutscher Länder and the Deutsche Bundesbank
Later in 1948, the Bank deutscher Länder The Bank deutscher Länder , abbreviation BdL, was the forerunner of the Deutsche Bundesbank. It was founded on 1 March 1948 assumed responsibility, followed in 1957 by the Deutsche Bundesbank The Deutsche Bundesbank is the central bank of the Federal Republic of Germany and as such part of the European System of Central Banks (ESCB). Due to its strength and former size, the Bundesbank is the most influential member of the ESCB. Both the Deutsche Bundesbank and the European Central Bank (ECB) are located in Frankfurt am Main. It is. The DM earned a reputation as a strong store of value A recognized form of exchange can be a form of money or currency, a commodity like gold, or financial capital. To act as a store of value, these forms must be able to be saved and retrieved at a later time, and be predictably useful when retrieved at times when other national currencies succumbed to periods of inflation In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time. When the price level rises, each unit of currency buys fewer goods and services; consequently, inflation is also an erosion in the purchasing power of money – a loss of real value in the internal medium of exchange and unit. It became a source of national pride and an anchor for the country's economic prosperity, particularly during the years of the Wirtschaftswunder The term Wirtschaftswunder (German for "economic miracle") describes the rapid reconstruction and development of the economies of West Germany and Austria after World War II. The expression was used by The Times in 1950. Beginning with the replacement of the Reichsmark with the Deutsche Mark as legal tender (the schilling was similarly in the 1950s. In the 1990s, opinion polls showed a majority of Germans opposed to the adoption of the euro; polls today show a significant number would prefer to return to the Mark.
Currency Union with the Saarland
The population in the Saar Protectorate The Saar Protectorate was a German borderland territory twice temporarily made a protectorate state. Since rejoining Germany in 1957, it is the smallest Federal German Area State , the Saarland, in contrast to the city states Berlin, Hamburg and Bremen. It is named after the Saar River decided in a referendum to join the Federal Republic. Thus the incorporation of the Saar into the Federal Republic of Germany A region named Germania, inhabited by several Germanic peoples, has been known and documented before AD 100. Beginning in the 10th century, German territories formed a central part of the Holy Roman Empire, which lasted until 1806. During the 16th century, northern Germany became the centre of the Protestant Reformation. As a modern nation-state, was stipulated by the latter and France, the Protector force, for January 1, 1957. The new German member state Germany is made up of sixteen Länder , generally referred to in English as states. In official English translations, the term "land" is commonly used. A Land (colloquially but rarely in a legal context also called Bundesland, for "federal state") is one of the partly sovereign constituent states of the Federal Republic of of the Saarland Saarland is one of the sixteen states of Germany. The capital is Saarbrücken. It has an area of 2570 km² and 1,045,000 inhabitants. In both area and population, it is the smallest state in Germany other than the city-states (Berlin, Bremen and Hamburg). Its location on the border between France and Germany has given Saarland a unique history. It maintained its currency, the Saar Franc The franc or Frank was the currency of Saarland between 1948 and 1957. It was at par with the French franc, French coins and banknotes circulated alongside local issues, which was in a currency union at par with the French Franc. On July 9, 1959 the Deutsche Mark replaced the Saar Franc at a ratio of 100 Francs = 0.8507 DM.
The German mark's role in German reunification
The Deutsche Mark played an important role in the reunification of Germany. It was introduced as the official currency of East Germany in July 1990, replacing the East German Mark (Mark der DDR), in preparation for unification on 3 October 1990. East German marks were exchanged for German marks at a rate of 1:1 for the first 4000 Marks and 2:1 for larger amounts. Before reunification, each citizen of East Germany coming to West Germany was given Begrüßungsgeld, greeting money, a per capita allowance of 100 DM in cash. The government of Germany, and the Bundesbank were in major disagreement over the exchange rate between the East German Mark and the German mark.
Stability of the German mark
The German mark had a reputation as one of the world's most stable currencies; this was based on the monetary policy of the Bundesbank. The policy was "hard" in relation to the policies of certain other central banks in Europe. The "hard" and "soft" was in respect to the aims of inflation and political interference. This policy is the foundation of the European Central Bank's present policy towards the euro. The German mark's stability was greatly apparent in 1993, when speculation on the French franc and other European currencies caused a change in the European Exchange Rate Mechanism. However, it should be remembered that "hard" is relative to other currencies. In its 53 year history the purchasing power of the German mark was reduced by over 70 percent.[4]
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Tue, 27 Jul 2010 02:28:59 GMT+00:00
strategy head joins Citi Financial Standard Over the past 12 months, Citi has hired analysts across various sectors, including Mark Greenwood from JP Morgan and Daled Koenders from London School of ...
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Berlin - Une majorite d'Allemands (51,4%) souhaite le retour du . deutsche mark. huit ans apres l'entree en circulation de l'euro comme monnaie de paiement, selon un sondage de l'institut Ipsos publi...
