Dennis Marek: The fascination with old memorabilia
I wrote last week about the problems of accumulation when associated with the desire to keep the historical and familial items. Often these are found when the decision to cull arises. I also shared some of what I discovered in that cleaning process. But there was more. And these items were more historical and personal in so many ways. The first is the bank note featured in the photo.
It is 2019. The First World War was over about 100 years ago, as it officially ended Nov. 11, 1918. What do we really know of that period? Virtually no living person is alive from then. We know there was some prosperity followed by a massive depression for us and most of the world. Not so for Germany. A part of the peace accords required reparations from Germany to the allied nations. The potential amount was so massive the United Stated would not sign the accord.
The result of the enforcement of those repayments literally broke Germany’s economy and most likely gave more credence to the arrival of Adolf Hitler. He rose to power on the promises to undo the great wrong inflicted by the allies in the enforcement of those accords.
What led me to delve a bit into these times of the early 1920s was something I found in my culling: a bank note to my grandfather, James A. Marek, for 100 million German marks, the currency of Germany and later West Germany until the euro became the monetary currency in 1999. But a check for 100 million? He was a bank teller for Northern Trust Company for years. Where would he get such a check?
That led to a historical chase into pre- and postwar Germany. Germany suspended the gold standard, the convertibility of its currency to gold before the commencement of the war. Unlike France, which chose to impose an income tax to pay for the war, Germany decided to do it by borrowing. They were sure they would win the war and be able to pay back these loans. Annexing resource-rich industrial territories in its neighboring countries easily would provide the needed income. The exchange rate steadily devalued from 4.2 marks to the dollar to 7.9.
The entire strategy failed when Germany lost the war. The Weimar Republic was saddled with this enormous debt. The country continued printing money without any backing. These were called “paper marks.” By the end of the war in 1919, 48 paper marks were required to buy a single U.S. dollar.
The mark stayed somewhat stable during the first half of 1921, as much of its industry had remained intact in spite of losing the war. In April 1921, however, a settlement was reached with the allies for Germany to pay out 2 billion gold marks annually, plus 26 percent of the value of German exports. When the first payment was made in June of that year, the hyperinflation began. These reparations were required to be paid in hard currency, not paper bills.
In 1922, Germany defaulted to France, and France sent troops into the Ruhr Valley and occupied the industrial development there. The German workers then went on strike and total chaos set in.
By 1922, the mark stabilized at 320 marks to the dollar, but the defaults continued. Germany tried buying foreign currency with its paper marks, but that only increased the breakdown.
When further meetings with American investment companies produced no results, the mark fell to 7,400. By the fall of 1922, Germany was unable to make the reparation payments, and the mark became virtually worthless. The Germans continued to print more money, and by November 1923, the U.S. dollar was worth 4,210,500,000,000 German marks. Along with this catastrophe, the cost of living for the German people skyrocketed as well. The country was ripe for a savior, even one as heinous as Hitler.
So, Grandfather’s check probably was worth about 25 cents when the check was written. I do not know the story of the check, but Continental and Commercial National Bank was a real institution. Perhaps the check was drawn as a joke, but it was drawn on the Deutsche Bank of Berlin, also a real bank. Was it just joking among the tellers of Chicago’s second largest bank? Who knows.
A wonderful piece of history buried for years in our family’s saved-but-undiscovered historical clutter. Why does it take a move to unearth these family treasures? If you have those saved boxes, go dig in and find your treasures. Who knows; your check might have been worth more than 25 cents.