Monday 21st April 2008 9:30 pm: Ex-empire currency debasements compared.
It's interesting to do a headcount of some ex-empire countries and what happened to their currencies. Greece - well their currency became tremendously debased. Turkey that was the heart of the Byzantine and Ottoman empires, both of which had nice gold coins - once the empire was gone, they had the most spectacular currency debasement much later. Germany after World War I had a currency that went effectively to zero value in the Hyperinflation of the 'Weimar Republic' in 1923.
Italy - now that's a great example. It look a huge time for Italy's currency really to collapse, although perhaps it was 'reset' at some point. There was debasement at the end of the Roman Empire but then there was a gigantic debasement in the 20th Century, perhaps due to Mussolini? Italy was part of the Latin Monetary Union in the late 1800s, with France, Belgium and some other European countries. The 20 Lire gold coin had 0.1867 ounces of fine gold, the same as the 20 French Francs, 20 Belgian Francs and 20 Swiss Francs. They were interchangeable and traded in any of these countries as being equivalent, which they were, because it was the gold content that mattered. There was no need for 'full faith and credit' of corrupt governments to be taken into consideration as there is now with junk paper and base metal money that is intrinsically worthless. The Latin Monetary Union was a true precursor to the present Euro, but better, because it was gold money. So the Francs were equal to the Lire at that time. Later, when the European countries' currencies were morphed into the Euro in 1999, the exchange rates for conversion were: 1 Euro = 6.56 French Francs, 40.33 Belgian Francs and 1936.27 Italian Lire! And 1 Euro = 1.6064 Swiss Francs today - the latest rate is shown here on Yahoo!
These individual countries' currencies had been equal before! The second highest number, on the list of the original Eurozone Eleven, i.e. the second most debased currency in the original Eurozone of 11 countries was the Greek Drachma at 1€ = 340.75 Drachma. Great empires seem to fall further than small ones! The bigger they are, the harder they fall, so there is a potential parallel with the UK and the USA coming up, perhaps?