What is 'Notgeld'

Notgeld is a German word that means "emergency money." It denotes a form of quasi-currency issued by a body other than a central bank, which is generally the only official issuer of a nation's currency, and therefore is not legal tender. Although the idea goes back centuries, the term notgeld dates to the huge amount of emergency money printed in Germany and Austria after World War I. 

BREAKING DOWN 'Notgeld'

Notgeld tended to be issued when central banks couldn't print or produce enough currency to cover immediate needs. The problem generally cropped up during periods of severe hyperinflation, when money lost its value overnight; or during wartime, when resources became scarce. To meet currency needs, states, municipalities and even neighborhoods or clubs printed notgeld. The emergency money almost always had an expiration date, either printed on the note itself or announced in the newspaper. Some merchants printed notgeld specifically for purchases at that store.

While notgeld typically appeared in the form of paper money, it sometimes included coins, stamps, playing cards and even raw materials like coal. Minters of notgeld coins used cheaper base metals during wartime, with the promise (inscribed on the coin) that they could be exchanged for actual gold or silver after the war. Of course, if the issuer lost the war, holders of the base coins were out of luck. Sometimes in periods after wars, people used melted-down guns to mint notgeld coins, hence the term “gun money.”

Notgeld appeared in abundance and in a variety of styles in Germany and Austria both during and after World War I. In Germany alone some 36,000 different types of notes, issued by more than 3,500 towns, cities and firms are known. At the height of the interbellum hyper-inflation during the 1920s, notgelds circulated in denominations of multiple trillions of Deutsche marks.

Notgeld Used Around the World

While most associated with central European countries during the early 20th Century, other governments used notgeld throughout most of the history of currency. Feudal Japan, revolutionary France, India during the Raj, China before the communist revolution, and the United States during the Civil War all used notgeld.

From Emergency to Hobby

Today, historic notgeld of all sorts is eagerly collected, and prized for its imaginative and colorful designs and illustrations. Some examples can sell for thousands of dollars, making many worth considerably more today than when they were printed.

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