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Currencies from a Central European’s Perspective (1917-2017)
Currencies from a Central European’s Perspective (1917-2017)
Who is a Central European? It’s someone who’s got a German name, Hungarian heritage, was born in Czechoslovakia (dissolved in 1993), lives in Bratislava (Slovakia), but loves to spend time in Vienna (Austria). It’s a person who appreciates the constant flux of political and economic events happening in this part of the world.
I wrote up this article for the SRSrocco Report to document three things. 1 – People all over the planet should never trust their governments with their money. 2 – Given the history of currency changes, it’s no surprise that people in Central Europe are, generally speaking, much poorer than people in Western Europe or North America. 3 – Protecting one’s wealth in an environment of constantly changing currencies is extremely hard. Thus, people should make the right choices when times are quite OK, because when the really hard times hit, all of one’s wealth can be lost very quickly and easily.
Never Trust a Government
The name of the game in relation to government controlled currencies is always wealth protection. US Dollar holders are used to something that is the exception, not the rule – namely, that the US Dollar hasn’t been cancelled, converted, or re-denominated in a very long time.
People in other parts of the world who have a much more intimate and frequent experience with currency changes, know that they cannot rely on their domestic currencies. Therefore, they seek refuge in alternatives.
While the US Dollar might be a good choice for some time, when the bill for government over-expansion comes due in the United States, not even the mighty US Dollar will survive as we know it today.
Central Europe of the Past: The Austro-Hungarian Empire
By the 19th century, the Austro-Hungarian Empire was one of the leading empires in Europe and the world. Its area covered more than 250,000 square miles. That’s roughly the land area of today’s France.
Currency Conversions in Central Europe Before World War I
The Habsburg-built Austro-Hungarian Empire used the Gulden (meaning golden) as its currency from 1754 to 1892. By weight measurement, the Gulden was equivalent to 1⁄20th of a Cologne Mark. The Cologne Mark was the weight equivalent of half a pound or 8 ounces. So, in effect, the Austro-Hungarian Gulden equaled to 0.4 ounces (about 11.34 grams) of silver. It was then subdivided into 60 Kreuzer.
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