Money is often said to be root of all evil, or at least something like that – but not if its worth is non-existent. Unfortunately, some governments fail to realize that you can’t just keep printing more and more money; it’s the quickest path to inflation. Then a currency loses its value and becomes totally worthless. In the end, the greed for more money leads to no money at all. Below are five currencies that failed miserably in our history.
1. The Chilean Escudo
The escudo was a short-lived currency that was introduced in 1960, with a conversion rate of 1 escudo to 1,000 pesos. Then socialism reared its ugly head in 1970 and everything went downhill from there. Salvador Allende, the Socialist Party’s leader, wasted no time redistributing wealth to the poor by nationalizing industries and increasing social spending. This led to insanely inflated prices and even strikes. By late 1972, inflation reached 600% and a staggering 1200% only one year later. The government was overthrown in 1973 and the New Peso replaced the escudo in 1985 with a good old-fashioned rate of 1,000 to 1.
2. The Weimar Papiermark
Like many European countries, Germany’s current currency is the Euro dollars. But this wasn’t always the case. Back when the nation was the constitutional federal republic known as Weimar Republic, their currency was the Weimar papiermark, something which didn’t last long. The loss of WWI came at a hefty price which had to be repaid to the other countries in the form of tangible assets, not just money. So they rapidly set out printing more of the already depreciating papiermark and only one year later, the cost of Germany’s living expenses increased 17-fold. The $70 million debt was finally settled in 2010, 92 years after WWI.
3. The Roman Denarius
The denarius coin was introduced in the late 3rd century BC during Rome’s battle against Hannibal in the Second Punic War. The coin’s silver content was pretty high and it weighed an impressive 4.2 grams. Rome also took advantage of Macedonia’s rich silver deposits, allowing them to produce millions of coins. Soon, the silver content in the coins decreased and citizens started hoarding the older coins instead. Eventually, the government gave up and insisted taxes had to be paid in gold or in kind. But citizens started uploading the denarius in droves, which further sped up the currency’s demise.
4. The Peruvian Inti
In 1980, Peru’s new administration had the genius idea of lifting restrictions on the flow of goods and services with the goal of sharpening competition and encouraging innovation. Instead, foreign investors got spooked, investments dried up and inflation skyrocketed. Peru’s currency, the sol, was rebranded as the inti with an exchange rate of 1,000 to 1. In 1990, the inti inflated to 400% per month and a 10 million inti banknote had to be created to meet the hyperinflated prices. This failed as well and in 1991, the inti was replaced by the nuevo sol with a conversion rate of one million to one.
5. The Belarusian Ruble
When the Soviet Union collapsed, Belarus struggled to stand on its own two feet and the country went from one dictatorship to another. What made this one worse was the over-inflated prices, and the fact that their first “president” is the country’s only “president” and was “elected” in 1994. In the following decade, Alexander Lukashenko made a series of bad decisions which led to the plummeting value of the Bulsarusian ruble. The government even had to add three zeros to all bills, a common tactic used to combat inflation.
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