Deutsche Mark

Currency name in local	German mark Deutsche Mark
Image 1	Deutschemarknotes.png
Image title 1	5 DM to 1000 DM Banknotes
Image 2	Dmark-coins-front.jpg
Image title 2	1 pf to 5 DM Coins
Iso code	DEM
Inflation rate	2.2%, November 2000
Using countries
Unofficial users	Bosnia and Herzegovina (1992–1998) Montenegro (1999–2002) Kosovo (1999–2002)
Erm since	13 March 1979
Erm fixed rate since	31 December 1998
Euro replace non cash	1 January 1999
Euro replace cash	1 January 2002/28 February 2002
Erm fixed rate	1.95583 DM
Pegged by	Bosnia and Herzegovina convertible mark, Bulgarian lev at par
Subunit ratio 1	1/100
Subunit name 1	Pfennig
Symbol	DM
Symbol subunit 1	pf
Plural	Mark
Plural subunit 1	Pfennig
Frequently used coins	1 pf, 2 pf, 5 pf, 10 pf, 50 pf, 1 DM, 2 DM, 5 DM
Rarely used coins	10 DM
Frequently used banknotes	10 DM, 20 DM, 50 DM, 100 DM
Rarely used banknotes	5 DM, 200 DM, 500 DM, 1000 DM
Issuing authority	Deutsche Bundesbank
Issuing authority website	www.bundesbank.de
Printer
Printer override with original text	Y
Printer website
Mint
Mint override with original text	Y
Mint website
Obsolete notice	N

The Deutsche Mark (, German mark, abbreviated "DM") was the official currency of West Germany (1948–1990) and Germany (1990–2002) until the adoption of the euro in 2002. It is commonly called the "Deutschmark" in English but not in German. Germans often say "Mark" or "D-Mark". It was first issued under Allied occupation in 1948 replacing the Reichsmark, and served as the Federal Republic of Germany's official currency from its founding the following year until 1999, when the Mark was replaced by the euro; its coins and banknotes 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 immediately upon the introduction of the euro—in contrast to the other Eurozone 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 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.

On 31 December 1998, the European Central Bank (ECB) fixed the irrevocable exchange rate, effective 1 January 1999, for German mark to euros as DM 1.95583 = €1. One Deutsche Mark was divided into 100 Pfennig.

Before 1871

A Mark had been the currency of Germany since its original unification in 1871. Before that time, the different German states issued a variety of different currencies, though most were linked to the Vereinsthaler, a silver coin containing 16 2/3 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 the conversion.

1873–1948

The first Mark, known as the Goldmark, was introduced in 1873. With the outbreak of World War I, the Mark was taken off the gold standard. The currency thus became known as the Papiermark, especially as high inflation, then hyperinflation occurred and the currency became exclusively made up of paper money. The Papiermark was replaced by the Rentenmark (RM) since 1923, November 15, and the Reichsmark (RM) in 1924.

Early military occupation 1945 - 1947

During the first 2 years of occupation the occupying powers France, UK, US, and the Soviet Union, were not able to successfully negotiate a possible currency reform in Germany. Due to the strains between the Allies each zone was governed independently as regards monetary matters. The US occupation policy was governed by the directive JCS 1067 (in effect until July 1947), which forbade the US military governor "to take any steps to strengthen German financial structure". As a consequence a separate monetary reform in the U.S. zone was not possible.

A few weeks later Erhard, acting against orders, issued an edict abolishing many economic controls which had been originally implemented by the Nazis, and which the Allies had not removed. 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 introduction of the new currency was intended to protect western Germany from a second wave of hyperinflation and to stop the rampant barter and black market 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 authorities, who regarded it as a threat. The Soviets promptly cut off all road, rail and canal links between the three western zones and West Berlin, starting the Berlin Blockade. In response, the U.S. and Britain launched an airlift of food and coal and distributed the new currency in West Berlin as well.

Economics of 1948 currency reform

Since the 1930s, prices and wages had been controlled, but money had been plentiful. That meant that people had accumulated large paper assets, and that official prices and wages did not reflect reality, as the black market dominated the economy and more than half of all transactions were taking place unofficially. The reform replaced the old money with the new Deutsch Mark at the rate of one new per ten old. This wiped out 90% of government and private debt, as well as private savings. Prices were decontrolled, and labor unions agreed to accept a 15% wage increase, despite the 25% rise in prices. The result was the prices of German export products held steady, while profits and earnings from exports soared, and were poured back into the economy. The currency reforms were simultaneous with the $1.4 billion in Marshall Plan money coming in from the United States, which primarily was used for investment. In addition, the Marshall plan forced German companies, as well as those in all of Western Europe, to modernize their business practices, and take account of the wider market. Marshall plan funding overcame bottlenecks in the surging economy caused by remaining controls (which were removed in 1949), and opened up a greatly expanded market for German exports. Overnight, consumer goods appeared in the stores, because they could be sold for realistic prices, emphasizing to Germans that their economy had turned a corner.

Currency reform in the Soviet occupation zone

In the Soviet occupation zone of Germany (later the German Democratic Republic), the East German Mark (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 assumed responsibility, followed in 1957 by the Deutsche Bundesbank. The DM earned a reputation as a strong store of value at times when other national currencies succumbed to periods of inflation. It became a source of national pride and an anchor for the country's economic prosperity, particularly during the years of the Wirtschaftswunder 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 rejected in a referendum the proposal to turn it into a "European territory". Despite French pre-referendum claims that a "no" vote would mean that the Saar would remain a French protectorate it in fact resulted in the incorporation of the Saar into the Federal Republic of Germany on January 1, 1957. The new German member state of the Saarland maintained its currency, the Saar Franc, 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.

France and the UK were opposed to German reunification, and attempted to influence the Soviet Union to stop it. However, in late 1989 France extracted German commitment to the Monetary Union in return for support for German reunification.

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.

Coins

The first German mark coins were issued by the Bank deutscher Länder in 1948 and 1949. From 1950, the inscription Bundesrepublik Deutschland (Federal Republic of Germany) appeared on the coins. {|class="wikitable" style="font-size: 90%" ! !Denomination !Dates issued !Composition !Obverse !Reverse |- |style="text-align:center" | |1 Pfennig |1948–2001 |1948–1949: Bronzeplated steel1950–2001: Copperplated steel |Denomination between rye stalks |Oak sprig |- |style="text-align:center" | |2 Pfennig |1950–2001 |1950–1968: Bronze 1968–2001: Bronzeplated steel |Denomination between rye stalks |Oak sprig |- |style="text-align:center" | |5 Pfennig |1949–2001 |Brassplated steel |Denomination between rye stalks |Oak sprig |- |style="text-align:center" | |10 Pfennig |1949–2001 |Brassplated steel |Denomination between rye stalks |Oak sprig |- |style="text-align:center" | |50 Pfennig |1949–2001 |Cupro-nickel |Denomination |Woman planting an oak seedling |- |style="text-align:center" | |1 DM |1950–2001 |Cupro-nickel |Denomination between oak leaves |German eagle |- |style="text-align:center" | |2 DM |1951, 1957–2001 |Cupro-nickel |1951: Denomination between rye stalks and grapes1957–1971: Max Planck1969–1987: Konrad Adenauer1970–1987: Theodor Heuss1979–2001: Kurt Schumacher1988–2001: Ludwig Erhard1990–1994: Franz Josef Strauß1994–2001: Willy Brandt |German eagle |- |style="text-align:center" | |5 DM |1951–2001 |1951–1974: Silver1975–2001: Cupro-nickel |Denomination |German eagle |- |style="text-align:center" | |10 DM |1987–2001 |1987–2001: Silver |Varies |German eagle,different designs |}

The masses and dimensions of the coins can be found in an FAQ of the Bundesbank.

Unlike other countries (such as Australia) there was no attempt (or proposal suggested) for the withdrawal of the one and two pfennig coins. Both coins were still in circulation in 2001 and supermarkets in particular still marked prices to the pfennig. This penchant for accuracy continues with the Euro (whilst Finland or the Netherlands for example, price to the nearest 5 Eurocent) with the Eurocent still encountered in Germany.

There were a considerable number of commemorative silver 5 and 10 DM coins, which actually had the status of legal tender but were rarely seen outside of collectors' circles.

On 27 December 2000, the German government enacted a law authorizing the Bundesbank to issue, in 2001, a special .999 pure gold 1 DM coin commemorating the end of the German mark. The coin had the exact design and dimensions of the circulating cupro-nickel 1 DM coin, with the exception of the inscription on the reverse, which read "Deutsche Bundesbank" (instead of "Bundesrepublik Deutschland"), as the Bundesbank was the issuing authority in this case. A total of one million gold German mark coins were minted (200,000 at each of the five mints) and were sold beginning in mid-2001 through German coin dealers on behalf of the Bundesbank. The issue price varied by dealer but averaged approximately $165 in U.S. dollars.

German coins bear a mint mark, indicating where the coin was minted. D indicates Munich, F Stuttgart, G Karlsruhe and J Hamburg. Coins minted during the Second World War include the mint marks A (Berlin) and B (Vienna). The mint mark A was also used for German mark coins minted in Berlin beginning in 1990 following the reunification of Germany. These mint marks have been continued on the German euro coins.

Between July 1, 1990 (Currency union with East Germany) and July 1, 1991 East German coins of denominations up to 50 pfennigs continued to circulate as Deutsche Mark coins at their face value, owing to a temporary shortage of small coins. These coins were legal tender only in the territory of the former East Germany.

Colloquial expression

In colloquial German the 10 Pfennig coin was sometimes called a Groschen (cf. groat). Likewise, Sechser (sixer) could refer to a coin of 5 Pfennig. Both colloquialisms refer to several pre-1871 currencies of the previously independent Länder (notably Prussia), where a Groschen was subdivided into 12 Pfennigs, hence half a Groschen into 6. After 1871, 12 Pfennigs of old currency would be converted into 10 Pfennig of the Mark, hence 10 Pfennig coins inherited the "Groschen" name and 5 Pfennig coins inherited the "Sechser" name. Both usages are only regional and may not be understood in areas where a Groschen coin did not exist before 1871. In particular, the usage of "Sechser" is less widespread. In northern Germany the 5-Mark coin used to be also called "Heiermann" (hired man).

Banknotes

There were four series of German mark banknotes:

The first was issued in 1948 by the Allied military. There were denominations of ½, 1, 2, 5, 10, 20, 50 and 100 DM, with two designs of 20 and 50 DM notes.

The second series was introduced in 1948 by the Bank deutscher Länder, an institution of the western occupation government. The designs were similar to the US Dollar and French franc, as the job of designing and printing the different denominations was shared between the Bank of France and the American Bank Note Company. There were denominations of 5 and 10 Pfennig, 5, 10, 20, 50 and 100 DM.

The third series was introduced in 1960 by the Bundesbank, depicting neutral symbols, paintings by the German painter Albrecht Dürer, and buildings. There were 5, 10, 20, 50, 100, 500 and 1000 DM denominations.

The fourth was introduced in 1990 by the Bundesbank to counter advances in forgery technology. The notes depicted German artists and scientists together with symbols and tools of their trade. This series added a 200 DM denomination, to decrease the use of 100 DM banknotes, which made up 54% of all circulating banknotes, and to fill the gap between the 100 DM and 500 DM denomination. Nevertheless the 200 DM denomination was rather rare.

In the latter two series, the 5 DM denomination was rarely seen, as were the ones with a value greater than 100 DM.

Banknotes of the fourth series (1990–2002)

from Germany 1999 showing Carl Friedrich Gauß]]

The design of German banknotes remained unchanged during the 1960s, 1970s and 1980s. During this period, forgery technology made significant advances so, in the late 1980s, the Bundesbank decided to issue a new series of Deutsche Mark banknotes. The colours for each denomination remained unchanged from the previous series but the designs underwent significant changes and a 200 DM denomination was introduced. Famous national artists and scientists were chosen to be portrayed on the new banknotes. Male and female artists were chosen in equal numbers. The buildings in the background of the notes' obverses had a close relationship to the person displayed (e.g., place of birth, place of death, place of work), as well as the second background picture (Lyra and the musician Schumann). The reverses of the notes refer to the work of the person on the obverse.

The new security features were: a windowed security-thread (with the notes' denominations in microprinting), watermark, micro-printing, intaglio-printing (viewing-angle dependent visibility as well as a Braille representation of the notes denomination), colour-shifting ink (on the 500 and 1000 DM denominations), a see-through register and ultraviolet-visible security features.

First to be issued were the 100 and 200 DM denominations on 1 October 1990 (although the banknote shows "Frankfurt am Main, 2. Januar 1989"). The next denomination was 10 DM on 16 April 1991, followed by 50 DM in autumn the same year. Next was the 20 DM note on 20 March 1992 (printed on 2 August 1991). The reason for this gradual introduction was, that public should become familiar with one single denomination, before introducing a new one. The change was finished with the introduction of the 5, 500, and 1000 DM denominations on 27 October 1992. The last three denominations were rarely seen in circulation and were introduced in one step. With the advance of forgery technology, the Bundesbank decided to introduce additional security features on the most important denominations (50, 100, and 200 DM) as of 1996. These were a hologram foil in the center of the note's obverse, a matted printing on the note's right obverse, showing its denomination (like on the reverse of the new €5, €10, and €20 banknotes), and the EURion constellation on the note's reverse. Furthermore, the colors were changed a bit to pastel to hamper counterfeiting.

{|class="wikitable" style="font-size: 90%" !colspan="13"|1989 Series |- !colspan="2"| Image !!rowspan="2"| Value !!rowspan="2"| € equiv. !!rowspan="2"| Dimensions !!rowspan="2"| Main Colour !!colspan="3"| Description !!colspan="4"| Date of |- ! Obverse !! Reverse !! Obverse !! Reverse !! Watermark !! first printing !! issue !! withdrawal !! lapse |- | style="text-align:center" | | style="text-align:center" | | 5 DM | 2.56 | 122 × 62 mm | Yellowish-green | Bettina von Arnim, Wiepersdorf estate and buildings of historic Berlin | Brandenburg Gate |rowspan="8"| As portrait | 1 August 1991 | 27 October 1992 |rowspan="8"| 31 December 2001 |rowspan="8"| Indefinite |- | style="text-align:center" | | style="text-align:center" | | 10 DM | 5.11 | 130 × 65 mm | Blue-violet | Carl Friedrich Gauss, Gaussian distribution, historic buildings of Göttingen | Sextant, a small map showing the triangulation of the Kingdom of Hanover performed by Gauss | 2 January 1989 | 16 April 1991 |- | style="text-align:center" | | style="text-align:center" | | 20 DM | 10.23 | 138 × 68 mm | Bluish-green | Annette von Droste-Hülshoff, buildings of the city of Meersburg | A quill pen and a beech-tree, referring to her work Die Judenbuche | 1 August 1991 | 20 March 1992 |- | style="text-align:center" | | style="text-align:center" | | 50 DM | 25.56 | 146 × 71 mm | Yellowish-brown | Balthasar Neumann, buildings of Old Würzburg, an architect's ruler | Partial view of the stairway in the Würzburg Residence, the ground plan of a famous chapel, Kreuzkapelle, in Kitzingen |rowspan="3"| 2 January 1989 | 30 September 1991 |- | style="text-align:center" | | style="text-align:center" | | 100 DM | 51.13 | 154 × 74 mm | Dark blue | Clara Schumann from a lithograph by Andreas Staub, buildings of historic Leipzig and a lyre | Grand piano, Background: the pre-war building of the Hoch Conservatory in Frankfurt am Main |rowspan="2"| 1 October 1990 |- | style="text-align:center" | | style="text-align:center" | | 200 DM | 102.26 | 162 × 77 mm | Orange | Paul Ehrlich, buildings of historic Frankfurt, the formula of Arsphenamine | Microscope, the Rod of Asclepius surrounded by simplified cell structures |- | style="text-align:center" | | style="text-align:center" | | 500 DM | 255.65 | 170 × 80 mm | Red-violet | Anna Maria Sibylla Merian, an insect, buildings of ancient Nuremberg | Dandelion, inchworm, butterfly |rowspan="2"| 1 August 1991 |rowspan="2"| 27 October 1992 |- | style="text-align:center" | | style="text-align:center" | | 1000 DM | 511.29 | 178 × 83 mm | Dark-brown | Wilhelm and Jakob Grimm, buildings of historic Kassel | The 'German dictionary' (Deutsches Wörterbuch), the Royal library in Berlin |- !colspan="13"| Hologram variant |- | style="text-align:center" | | style="text-align:center" | | 50 DM | 25.56 |rowspan="3" colspan="5" align="center"| As previous |rowspan="3"| 2 January 1996 | 2 February 1998 |rowspan="3"| 31 December 2001 |rowspan="3"| Indefinite |- | style="text-align:center" | | style="text-align:center" | | 100 DM | 51.13 |rowspan="2"| 1 August 1997 |- | style="text-align:center" | | style="text-align:center" | | 200 DM | 102.26 |- |colspan="13"| |}

Spelling and pronunciation

The German name of the currency is Deutsche Mark (fem., ); its plural form in standard German is the same as the singular. In German, the adjective "deutsche" (adjective for "German" in feminine singular nominative form) is capitalized because it is part of a proper name, while the noun "Mark", like all German nouns, is always capitalized. The English loanword "Deutschmark" had a slightly different spelling (possibly due to the frequency of silent e in English) and a plural form in -s. In Germany, the currency's name was often abbreviated as D-Mark (fem., ) or simply Mark (fem.) with the latter term also often used in English. Like Deutsche Mark, D-Mark and Mark have no plural form, the singular being used to refer to any amount of money (e.g. eine (one) Mark and dreißig (thirty) Mark). Sometimes, a plural form of Mark, Märker was used as either as diminutive form or to refer to a (physically present or small) number of D-Mark coins or bills (e.g. Gib mir mal ein paar Märker (Just give me a few Mark (-bills or -coins)) and Die lieben Märker wieder (The lovely money again (with an ironic undertone)).

The subdivision unit is spelled Pfennig (masc.; ), which unlike Mark does have a commonly used plural form: Pfennige (), but the singular could also be used instead with no difference in meaning. (e.g.: ein (one) Pfennig, dreißig (thirty) Pfennige or dreißig (thirty) Pfennig). The official form is singular.

As a reserve currency

Before the switch to the euro, the mark was considered a major international reserve currency, second only to the US dollar.

See also

Euro

German euro coins

List of commemorative coins of the Federal Republic of Germany

German Papiermark and Notgeld

German Reichsmark

Economy of Germany

References

External links

Coins of the Third Reich

Overview of German Mark from BBC online

Historical US Dollars to German Marks currency conversion, 1913-2005

Coins 2

Category:Currencies of Germany Category:Economic history of Germany Category:Modern obsolete currencies Category:Currencies replaced by the euro Category:Currencies of Europe Category:1948 establishments Category:2002 disestablishments