The History of Currency, 1252 to 1896

by William Arthur Shaw

In view of such contrariety the impossibility

of any general régime for the empire became apparent, and further attempts at it were practically abandoned. It was the perception by the mercantile community, as well as by the various Governments, of the consequences of such disorder, that led to the establishment of the so-called Leipzig standard in 1690. This standard was promoted by John George III. of Saxony, and established by treaty between Saxony, Brandenburg, and Brunswick-Luneburg. According to it the Reichs thaler was raised to 120 kreutzers, or 2 florins, the mark being minted into 12 thalers or 18 guldens.

The result of the introduction of this standard was that in a few years the raising of the Reichs thaler to 120 kreutzers prevailed all over the empire. Sweden accepted it in the same year, 1690, and three years later the three upper circles acquiesced. At the same time the gold gulden was advanced to 2 florins 56 kreutzers. The previous ratio of 15 was thereby advanced to 15.1 (15 128⁄1278).

In 1738 the Reichstag determined on the adoption of the Leipzig standard for the whole empire; no alteration was made in the Reichs thaler, which was still retained at 2 florins and minted at 12 to the mark fine; but a graduated scale of agio was adopted for the divisional coins, which were minted at an equivalence of from 12 3⁄8 to 13 2⁄3 thalers to the mark fine. The difference (varying from 3⁄8 to 1 2⁄3 thalers) represented the agio.

GERMANY: THE CONVENTION STANDARD

From the first, however, the Leipzig standard

had no more real success than any of its predecessors. Although theoretically accepted by all North Germany, and adopted in the Reichstag in 1738, it could obtain no actual general adoption through the empire. Even from the moment of the inception of the system in 1690, the process of competitively raising the course of the coinage had still continued, and pieces of 30, 20, 15, and 10-kreutzers were struck on a basis of from 20 to 21 1⁄3 gulden to the mark. The result was to put upon the carolus, which from 1730 onwards was minted in great quantities in South-West Germany, an agio of 10 per cent., a differentiation which was much increased by the disorders of the war of the Austrian succession. Such an agio swiftly drove the larger, full-valued specie out of currency, and during the continuance of that war the currency of Austria and South Germany was almost entirely reduced to depreciated fractional pieces, while the exchangers reaped untold advantage. It was on the close of this war, in 1748, that, with characteristic Austrian selfishness, though also with a boldness none of his predecessors had approached, the Emperor, Francis I., determined on the erection of the 20-gulden standard as a separate Austrian independent system, minting the mark of fine silver into 13 1⁄2 Reichs thalers, or 20 guldens. This latter system, after the accession to it of Bavaria, obtained the name of the Convention Standard, and the 2-gulden pieces minted under it are styled the Species or Convention Thaler. The convention system remained

in force in Austria until the Vienna Coinage Convention of 1857, a period during which the Convention Thaler found wide circulation through South Germany.

The currency was eked out by the Austrian gold ducats and by vast quantities of foreign silver, French 6-livre thalers (current for 2 florins 48 kreutzers) and the crown or Brabant thaler (current for 2 florins 42 kreutzers). From 1807 onwards this latter coin was imitated by the South German States, Bavaria especially, in their crown thaler, minted on a fresh basis of 24 1⁄2 guldens to the mark of fine silver.

The selfish initiative of Austria was followed by Prussia and the South German States. The latter, the Rhenish and South German States, adopted in 1761-65 the 24-gulden; subsequently changed into the 24 1⁄2-gulden standard (see [Appendix VI.]). The overvaluation of the Kronthaler, which led to that latest development from a 24 to a 24 1⁄2-gulden standard, was the result of the immense circulation of French 6-livre pieces (known in Germany as Laubthalers) in South-West Germany. Graumann quite discredits the theory that the overswimming of South Germany by these French pieces, with all the confusion in the currency which resulted, was due to the wars and the progress of French arms, and directly attributes it to the depreciation of the French specie, and to their quite deliberate departure from the standard of French coinage as fixed in 1726.