A Brief History
On April 12, 2009, the East African nation of Zimbabwe gave up entirely on its troubled currency, the Zimbabwean Dollar, using various foreign currencies in place of the worthless national money. Many countries have come and gone, and their forms of currency with them, while other nations have changed their national currency for a variety of reasons. Today we take a look at some of the interesting monetary changes that have occurred in recent history. What currency would you add to this list?
Digging Deeper
Zimbabwean Dollar replaced with Real Time Gross Settlement Zimbabwe Dollar (2019)
Africa in the late 20th Century was a hotbed of change, with former colonial governments and their remnants disappearing to be replaced by governments of indigenous people. Rhodesia, formerly a British colony called Southern Rhodesia, had become a republic in 1970 and replaced their Rhodesian Pound with their new Rhodesian Dollar at the rate of 2 dollars per pound. After a nationalist movement by Native Africans, Rhodesia became Zimbabwe in 1980, and the new Zimbabwe Dollar currency became a troubled monetary unit indeed. Inflation of the Zimbabwe currency was so incredibly high that the government was compelled to issue a $100 TRILLION paper banknote! By the time the currency became de facto totally obsolete, the value had fallen by a factor of 10 to the 25th power in its final incarnation in 2009, the so called “4th Zimbabwe Dollar.” While the country made do using foreign currency, they finally officially abolished their worthless money in 2015, and came up with the new monetary unit of the RTGS Zimbabwe Dollar in 2019. The new money quickly suffered massive inflation, and by 2020 the government had once again allowed the use of foreign currency for general use in the country. Keep trying Zimbabwe! Maybe someday you will get it right…
The Euro replaces many European currencies (1995-2002)
The European Union, kind of but not quite a “United States of Europe” in which the citizens of member countries can freely travel between nations and trade across borders is unfettered by normal international tariffs and regulations, and the establishment of a unified stance on many international aspects of diplomacy, decided to create a common currency, which in 1995 got its name, the Euro, and became effective in1999, though the physical money, both paper and coins, did not completely replace existing currencies until 2002. The Euro is divided by 100 cents similar to the US Dollar, and is in use throughout Europe, becoming the official currency of 19 of the 27 member nations of the EU and an additional 4 “micro” nations, while all member nations are supposed to convert sooner or later. The Euro, using the symbol “€” is the second most traded currency in the world today, behind (of course) the US Dollar. One member nation that never did adopt the Euro was the United Kingdom (Britain), which retained its Pound Sterling system, kind of a foreshadowing of future events as the UK withdrew from EU membership in 2020. Some of the notable bygone currencies once spent by this author include the French Franc, the Greek Drachma, the German Mark, the Spanish Peseta and the Italian Lira. The US Dollar is currently worth about 82.5 Euro cents as of February 19, 2021.
Israeli New Shekel replaces Old Shekel (1986)
Going back to 1980, Israel was replacing their old Israeli Pound monetary system with the Shekel, worth 10 Pounds per Shekel. (This new monetary unit was in transition when the author was in Israel in 1980, with both units in circulation.) The Shekel, later referred to as “the Old Shekel,” was broken down into 100 agorot, more or less like the “cents” the US Dollar and the Euro are divided by. Hyperinflation meant the end of the Old Shekel was near by 1985, and it was replaced by the aptly named New Shekel the next year. The New Shekel was worth 1000 of the Old Shekels, which should illustrate just how bad inflation had gotten! The name of the currency comes from ancient Biblical sources describing money as Shekels. (Is this the same thing as the United States reverting to the “Wampum?”) The New Shekel has had a much better shelf life than the Old version and is still the monetary unit of Israel today.
German Mark (before and since reunification 1990)
Germany introduced the Goldmark into circulation after its unification of various German states back in 1871, with the Goldmark created in 1873. The economically trying times of World War I saw the replacement of the Gold Standard with the Papiermark, which led to the infamous hyperinflation of the post-war period, requiring a new monetary standard in 1923, the Rentenmark, which only lasted until 1924 when it was in turn replaced by the Reichsmark. The new Mark survived through World War II, but when Germany was split between East and West Germany, each resulting country got their own version of the Mark in 1948, with the West using the Deutsche Mark and the East minting and printing money as the Mark der DDR (the East German Mark). In 1990, with reunification came a consolidation to both parts of Germany using the Deutsche Mark. By 1999, membership in the European Union saw another change, with Germany transitioning to the Euro.
British Pound Sterling (decimalization 1971)
The Pound has not really been replaced, and in fact it is the longest running monetary unit of currency in the world, first appearing around 775 A.D. during the Anglo-Saxon period of British History. As you might guess, the name came from its equivalence of 1 pound of Silver, divided into 20 Shillings. The odd, non-decimal way of sub-dividing the Pound continued with Shillings, Farthings, Pence, Guineas, Half Penny, Sovereigns, Crowns and Pennyweights, and though it went through several iterations over the centuries based on different weight standards (Saxon Pound, Tower Pound, Troy Pound) the basic unit remained the currency of Britain for hundreds of years. In 1971, the United Kingdom (aka, Britain), joined most of the rest of the world by creating a decimal system to subdivide their currency and has used the decimal system since. Not surprisingly, the decimal system thus created employs 100 pence per Pound. Previously, the Pound was the equivalent of 20 Shillings, and each Shilling was divided into 24 Pence, and each penny (or Pence) further divided into 4 Farthings. Thus, each Pence was 1/240th of a Pound. Making matters even more convoluted, a Guinea was worth 21 Shillings, a tad more than a Pound. The British Pound was not offered as paper money until 1694. In 1707, when Scotland joined the rest of Britain in the United Kingdom, the Pound Scots was replaced by the British Pound and the Irish Pound was replaced by the Pound Sterling in 1826. As noted in the entry about the Euro, Britain never did drop the Pound in favor of the Euro.
Question for students (and subscribers): Which of these obsolete currencies have you personally spent? Please let us know in the comments section below this article.
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Historical Evidence
For more information, please see…
Goldstein, Jacob. Money: The True Story of a Made-Up Thing. Hachette Books, 2020.
Weatherford, Jack. The History of Money. Currency, 1998.
The featured image in this article, the Obverse of the 2009 Zimbabwe $100 trillion banknote by the Reserve Bank of Zimbabwe self-scanned by Marianian followed by minor Photoshop enhancements to improve appearance and reduce size. Second version scan by Camp0s with original color preserved, transferred from en.wikipedia to Commons by User:Avicennasis using CommonsHelper, is in the public domain because it is either an image of a banknote which has been demonetized in terms of the Reserve Bank of Zimbabwe Act [Chapter 22:10], or an image of a coin or the artistic work defining the design of a coin.
