Weird History
37.8k readers

12 Times Currency Was Rendered Almost Worthless (and Why)

Updated October 8, 2019 37.8k views12 items
Editor's Note: Voting and Reranking have been closed.

Some of the worst inflation in history has coincided with war, as several of the worthless (or nearly worthless) currencies on this list illustrate. Wars are massively expensive, and one of the fastest ways for a cash-strapped government to pay for one is to fire up the presses and churn out a pile of paper money. However, history's pretty clear that this tactic will get you stabbed in the back with the dull, rusty blade of inflation, and if that stab wound gets infected and turns into hyperinflation – which usually happens – your economy is toast. Which is doubly bad if you end up on the war's losing side.

But there are other times currency became worthless, simply because of ill-advised financial policy, or because people are crazy and will do crazy things, which is why one of the currencies below is literally a living thing. So, ready to burn through some cash? Great, because here are examples of worthless currency in history – some old, some new, all ultimately useless.

  • French Assignats

    Photo: Nicolas-Marie Gatteaux and Jean-Baptiste Gérard / Wikimedia Commons / Public Domain

    At the dawn of the French Revolution, France was buried in debt and its government was desperate for a solution. A man named Charles Maurice de Talleyrand had one of those up his sleeve, and it was fairly straightforward – seize church lands and auction them off. By the way, Talleyrand was a bishop when he made this suggestion. The pope excommunicated him two years later, and Talleyrand went on to become a shrewd politician and diplomat who calls "an unabashed liar and deceiver" whose "moral corruption is beyond question." Winning!

    Anyhow, Talleyrand's idea sounded pretty great to the government, so that's exactly what happened. France nationalized church properties and began issuing notes called assignats, which the public could purchase with actual money and then use to lay claim to a piece of property.

    Unfortunately for France, this easy cash grab turned into hyperinflation when the government kept printing assignats and re-circulating any it received back. By 1796, the face value of assignats in circulation was about 20 times the estimated value of the nationalized church properties. It didn't help that England, France's enemy at the time, was complicating the situation by printing counterfeit assignats and injecting them into the French economy.

  • Newfoundland Dollars And Black Monday

    Photo: Union Bank of Newfoundland / Canadian National Currency Collection / Public Domain

    December 10, 1894 – or Black Monday, as it became known – was a dark and stormy day for the people of Newfoundland. That morning, the British colony's only two private banks, Union Bank and Commercial Bank, both closed forever, and the notes they'd been issuing for years lost their value. People throughout Newfoundland did business with these notes, so the crash's impact was huge. Everyone from fishermen to fish merchants to bankers (obviously) watched their savings and livelihoods disappear.

    Various factors brought about Black Monday. Major causes boil down to irresponsible banking practices (for example, loaning large sums to merchants who happened to sit on the bank board) and a struggling codfish industry, which made up the bulk of Newfoundland's economy in the 19th century. The government Savings Bank, which did not issue paper currency at the time, survived the crash, mainly because it had first claim on deposits at the Union Bank and withdrew what it needed before it was too late.

  • Roman Denarii And The Crisis Of The Third Century

    Photo: Johny SYSEL / Wikimedia Commons / CC BY-SA 4.0

    During the third century, the Roman Empire was in a bit of a pickle, facing widespread civil war and invasion by hostile tribes, with some plague tossed in for fun. The cost of dealing with nonstop uprisings and emergencies put a huge strain on the empire, and one way Rome dealt with the expenses was by debasing its coinage. Like our good friend the printing press, debasement is a tools governments like to use to their financial advantage without regard for consequence. In this case, the tool of debasement reduced the percentage of valuable metal in coins like the denarius to keep more cash in the treasury.

    Debasement spawned hyperinflation. And it was a long time coming, too. The denarius had faced debasement for decades – almost pure silver during the reign of Caesar Augustus, it slowly lost value over time as emperor after emperor lowered its silver content in order to mint increasingly worthless coins. By the time Gallienus took power in 253, the denarius was a copper coin with a silver coating, and society was well on its way to ignoring currency and instead relying on the barter system and the kind of self-sufficiency that would later take hold in the Middle Ages.

  • Brazilian Cruzeiros

    Photo: Dany duquefer / Wikimedia Commons / CC BY-SA 3.0

    In the '80s and '90s, Brazil's currency suffered ridiculous inflation, surpassing a rate of 500% most years between 1988 and 1994, and spiking to almost 3,000% in 1990. According to NPR, this can be traced to the 1950s, when the government financed its official capital city, Brasília, by printing lots of money and accidentally kicking off the inflation cycle.

    Prices consistently rose at least once a week during the inflation years, creating a situation in which shopkeepers would put color-coded price stickers on nonperishables so they wouldn't have to continually update their entire inventory. People got used to buying in bulk and stockpiling. You couldn't keep Brazilian cruzeiros around for too long; they'd just be useless in a few days. 

    The solution to inflation  arrived with the introduction of a new currency called the real, and a clever trick by a group of four economists from the Catholic University in Rio de Janeiro. Instead of rolling out the new currency right away, they suggested introducing a fake currency called the Unit of Real Value. Everything from supermarket prices to wages would be expressed in the URV and held constant regardless of fluctuations in cruzeiros. The idea was to gradually trick people into thinking in URVs instead of cruzeiros, and then, once the URV concept was entrenched in people's minds, announce that the URV actually was the real thing, and it was now called the real. It was a brilliant move on Brazil's part, and it got the finance minister – Fernando Henrique Cardoso – elected as president in 1994.