Commodity prices in Weimar Republic 1913-1923

This is the first post I will write in English, so please excuse my mistakes. I saw videos on YouTube, where some people, including Mike Maloney in his “Hidden Secrets Of Money”, told us that an ounce or two of gold had bought a house in the past. I think Mike Maloney said, he didn’t search for this, but heard it from the Swiss investor Marc Faber. So I wanted to know if this is a real fact or not. History and specially the history of money was ever interesting for me. For few years I have been living in Germany and I have access to the library of my university, so I started looking for old newspapers. And as many other things, the Germans have done a very good job in scanning old newspapers. It was a bit hard work, because of the old German font used in the books and newspapers. Anyway… in the next lines I will not only present to you some commodity prices, but some other interesting facts in the time before the World War I and the Hyperinflation in 1923.

As first I want to show you two of the major currencies in Europe at this time: The Swiss frank and the Goldmark. Switzerland at time was part of the so called Latin Monetary Union. So the value of the Swiss frank was: 1 Frank = 0,290322g Gold = 4,5g Silver. The German Goldmark itself: 1 Mark = 0,358g Gold = 5,55g Silver. At this way you can always determine what was the commodity price in gold and silver. So lets get started!

1913-09-11

House with garden 28 000 M = about 322 oz. gold [1]

1913-09

Car = 1 600 M Motorcycle (second hand) = 250 M
Bicycle = 25 – 40 M Pushchair = 15 M
Sofa = 25 M Stove = 20 M
Basler Bank: Interest rate 3,5% – 4,5% House (Between Karlsruhe and Freiburg) = 6 000 M.
Rent 3 floor apartment = 400 – 600 M 250 decare near Basel (covered with forest) = 40 000 M
Rent 5 floor apartment = 1000 M House (5-6 rooms) Freiburg = 25 000 M
Rent 10 floor apartment = 1500 M House + (32,5 decare) near Freiburg = 12 000 M

1914-06-02 [2]

4 Pound white bread 0,60 M
4 Pound rye bread 0,81 M
1 Pound veal 1 M
1 Pound pork 0,85
1 Liter Milk 0,23 M
4 Eggs 0,50 M
 

1914-06-10[3]

Car 6 P.S. = 450 M 2,5 storey house (Freiburg) = 18.000 M

I also find an interesting article, called “Papier statt Gold” or in English “Paper instead of gold”. It describes how the Germans at that time (1913-09) do not very like the Paper-Marks. Of course you can always change your Paper-Marks for Goldmarks because of the Gold standard, but the people prefer the Goldmark instead of Paper-Marks. You can see in the table the percentage of Paper- and Goldmarks in circulation [4]:

 

1908

1911

1912

Banknotes

27,76%

28,37%

30,08%

Goldmarks

72,24%

71,63%

69,92%

 

Then in August 1914 the World War I started. Weimar Germany needed money to finance the war. And at the beginning of august the gold standard was removed. I found another interesting article [5]: Many business owners didn’t want to accept the Papermarks. They were committed to accept the Papermarks or their localities would be closed.

1919 – So the war ended, Germany have lost and should pay a lot of reparations. The economy was bad and there was a lot of unemployment at this time.

1919-12

Apple/Pear 0,60 – 2 M
Chicken (alive) 14 – 20 M
Hen (alive) 25 – 30 M
Goose 60 – 75 M
Duck 25 – 30 M
Dove ?!? 5,50 M
Ladies shirt 18 – 27 M

1919-12-20

1 Swiss Frank 874 M

1919-12-28

Hotel Karlsruhe 185 000 M
Hotel Basel + 125 decare 185 000 M
Cafe-Hotel 70 000 M
Small Hotel 70 000 M
 
If we here make simple calculation: a hotel in the town of Basel costs 185 000 Marks. In Swiss frank about 212 CHF. As I noticed the Swiss frank had a value of 0,290322g Gold. So at that time the hotel really costs 2 ounces of gold.
 
I also found what was the income tax at the end of 1919 in Baden (region on the east bank of the Rhine in the southwest of Germany):
 

1919-12 Income Tax in Baden

1 000 M 100 M
10 000 M 1 450 M
21 000 M 4 110 M
31 000 M 7 080 M
50 000 M 13 000 M
101 000 M 38 900 M
200 000 M 100 000 M
301 000 M 166 300 M
500 000 M 60 %

1923-01-01

1 $ = 7 267 M Flour (50kg) = 42 000 – 47 000 1 kg (900) Silver = 144 000 M

1923 Banknotes in circulation

1923-02-23 3 123 Milliard Mark
1923-03-24 4 000 Milliard Mark

1923-03-04

1 $ = 22 600 M 1 Swiss Frank = 4 275 1 kg (900) Silver = 445 000
Kidney bean = 1 600 M Pea = 1 600 Rice = 1 700

1923-04-05

1 $ = 21079 M 1 Swiss Frank = 3865 M 1kg (900) Silver = 420 000 M

1923-10-19

300 decare = 120 000 Goldmark House (5 rooms) = 25 000 Goldmark
Very interesting fact: At the pick of the hyperinflation in 1923, the people stopped accepting the Papermarks, and accepted again only Goldmarks. So at that time a house costs again as before the war about 288 ounces of gold.
 
At the end I will show you two more tables with prices:
 
Deutsche Bank share in Mark between 1913 and 1923
1913-09-01 247
1913-09-30 248,25
1914-06-02 239,75
1914-06-09 240
1914-06-29 237
1919-10-28 250
1919-12-01 249
1919-12-18 260
1923-01-03 8 350
1923-01-29 20 000
1923-02-28 27 750
1923-03-28 22 800
1923-04-27 28 500
1923-05-28 50 000
1923-06-29 300 000

Flour (100kg) – Q1 1923

1923-01-22 84 000 M
1923-01-29 112 000 M
1923-02-05 140 000 M
1923-02-12 125 000 M
1923-02-19 110 000 M
1923-03-04 140 000 M
 

So at the end, for every commodity there are picks and downs. It depends on: where the house is, in witch country it is, in witch currency and what the people need more (after a war: house or food) and so on.

I hope you will find my post interesting and if so, please share. Thanks and have a good day!

p.s. And a photo of 20 and 50 million Mark from 1923

IMAG0800


[1]Freiburger Zeitung 1913-09-11 Zweites Morgenblatt, Page 3.
[2]Freiburger Zeitung 1914-06-02 Zweites Morgenblatt, Page 2.
[3]Freiburger Zeitung 1914-06-10 Zweites Morgenblatt, Page 3.
[4]Freiburger Zeitung 1913-09-21.
[5]Freiburger Zeitung 1914-08-04.

  1. Very interesting. Thank you for your work!

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