— Ch. 1 · Origins And Predecessors —
Deutsche Mark.
~5 min read · Ch. 1 of 7
Before 1871, the German states issued a variety of different currencies. The North German thaler and the South German gulden were the most common forms of money in circulation. By 1857, both currencies linked to the Vereinsthaler, a silver coin containing 16.66 grams of pure silver. A fixed exchange rate between the Vereinsthaler and the mark used three marks for one Vereinsthaler. The first official mark known as the Goldmark arrived in 1873. World War I forced Germany off the gold standard. High inflation turned the currency into paper money called the Papiermark. Hyperinflation destroyed its value completely. The Rentenmark replaced the Papiermark on the 15th of November 1923. The Reichsmark followed in 1924.
The June 1948 Reform
Ludwig Erhard officially introduced the Deutsche Mark on Sunday the 20th of June 1948. Large amounts exchanged at ten old Reichsmarks for sixty-five pfennigs. Each person received a per capita allowance of sixty Deutsche Marks split into forty and twenty parts. Edward A. Tenenbaum managed eleven experts who devised this reform. They created the name Deutsche Mark as a temporary title that became permanent. Erhard issued an edict abolishing economic controls on that same Sunday. He acted against orders because American, British, and French occupation offices were closed. He knew they would countermand the order if open. The new currency protected western Germany from hyperinflation. It stopped rampant barter trade where cigarettes served as money. Soviet authorities cut all road links between western zones and West Berlin. The United States and Britain launched an airlift to distribute the new currency in West Berlin.