Bimetallism

As bimetallism - in contrast to Monometallismus - refers to a monetary system whose unit is based on Kurantmünzen of gold and at the same time on those made of silver. Since the unit is linked to the value of two precious metals at the same time so that their exchange ratio is fixed. A short time also existed a Trimetallismus with platinum in 19th century Russia. Parallel to a Bimetallwährung notes and coins can be issued. These are not covered by the material value and can be provided with a forced currency, which can cause rate shifts between the different kinds of money.

History

A juxtaposition of Kurantmünzen of gold and silver in payment is not uncommon. In Prussia in the 18th and early 19th century were about the werthaltigeren payments, mostly foreign payments of high value goods such as luxury items, often made ​​with golden Friedrich d'or and the ordinary domestic payments with silver thalers. A statutory fixed rate between gold and silver and Friedrich d'or and Prussian thalers did not exist back then.

Basis of bimetallism is the contract or even a legal requirement for a fixed value ratio between the coinage metals used within a country. Even such a commit in all or at least in the wealthiest countries of a monetary union meant bimetallism. In France (from 1803) and later in the Latin Monetary Union ( 1865 ), this ratio was fixed at 15.5 ( 1 g of gold had the same value as 15.5 g of silver).

In the Latin Monetary Union, the bimetallism expressed is that the weights of two fine silver 5 -franc pieces and a gold 10 -franc piece ( gold francs ) behaved like 15.5 to 1 ( to 1870). Also in Germany there was until 1907 a " prescribed by law bimetallism ", as the silver, easy customs Vereinstaler circulated as Kurantmünze addition to the gold coins. The Zollverein Taler was the defining Münznominal the previous currency of the Mark. The situation applicable to 1907 is called the " gold standard ".

Problems

A permanent establishment of a stable value ratio is not economically unrealistic. Two or more different metals, goods, commodities or services can not be generated over a longer period in equal prices as continually changing economic conditions and changes the demand and fashion. This means that the higher-rated metal flows into the private accumulation or abroad - if a cash - choice at checkout, there is ( Gresham's Law). Still shows the example of France from 1803 to the 1870s that bimetallism can stabilize the value ratio between silver and gold on the world market permanently in a sufficiently large country (then also during the gold rush era from 1849).

The bimetallism or even Trimetallismus, however, was sentenced to the transition of the German Empire to the gold standard since 1871 and the subsequent demonetization of silver in many states to fail. The weaknesses of the new gold standard showed during the course of the 1870s, began as the decline in silver prices as well as the overall price level. Advocate of bimetallism as Henri Cernuschi demanded the ( re) introduction of bimetallism in other countries, what the silver mining industry was very interested. Countries that had a rating based on the gold standard currency, and a depreciation feared, however, resisted. The introduction of a fixed value ratio between gold and silver was rejected on the international Münzkonferenzen in Paris in 1878 and 1881.

Others

The dynamic value ratio between silver and gold fluctuated in 2009 between 1 to 45 and 1 to 90

The term is not to be confused with bimetal, which changes its form when the temperature changes. He also has nothing to do with bimetal, which consist of two different metals or alloys, such as the 1 - and 2- euro coins.