When money was no longer there….

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This blog is not about medicine, but about finance. It is still about health, but financial one. Money has a notional value, and in Indian culture, it is often equated with Maya – “a magic show, an illusion where things appear to be present but are not what they seem.” According to ancient Indian philosopher, Adi Shankara entire world itself is Maya, an empirical reality that entangles consciousness.

Despite all the philosophy, almost entire world revolves around this empirical reality. All countries of the world and civilisations ended up creating money, initially as coins that had same value as weight of the metal. Later this Maya was created as bank-notes, where the value is written on a piece of paper. It is only the signature of the issuer, and a guarantee that attests to the face value as its real value.

As we go along the blog, we will find the zoomed in versions of the eight postage stamps. You may be able to identify your native bank-notes, and find out if these have ceased to exist. Your comments will be most welcome !!!

Early instances of disappearance of money…

First recorded instance, when a circulating currency was made to disappear was in 1873 in the United States. This was due to a coinage act, brought out in the same year. All silver coins were declared illegal, and were to be replaced by gold coins alone. This was a de-facto attempt to have a “gold standard” which is to have real value for all circulating money in gold. Obviously, this did not work, and silver coins were back in 1878.

When high value currencies were made to disappear…

US demonetized its high value bank notes in 1969. So all bank-notes above 100 USD were destroyed. The idea was to get all these bank notes, back into the banking system. Till date, US has not issued a bank note with a higher value. The same principle prompted India to demonetize high value currency notes in 1978. So all bank notes above 500 rupees (including the 1000 rupees and the 10000 rupee banknote) became illegal, and had to be deposited in the banks.

Some unsuccessful attempts…

As economies become complex, and paper money depends solely on the face value and its guarantee, it is possible to simply print more banknotes, to create more money. While these prints come with security features, it is still possible to create counterfeits. Since it becomes difficult to find counterfeits and eliminate them, one of the options is to remove all real as well as fake notes from the system. This is another reason to make money disappear, and issue a replacement.

Ghana in 1982, Nigeria in 1984, Burma in 1987, and Soviet Union in 1991 and Zaire in 1993 tried to eliminate certain banknotes from their economies. All of these are counted as failures. Either people refused to exchange their bank-notes, or there were mass protests, and even led to coups and breakups.

And some successes …

In 1996 Australia moved away from paper bank-notes to polymer currency. This was well accepted, as the value of the currency was unchanged. Further, new notes were already in circulation for four years.

In 1999, Europe saw a big change, with introduction of a new unified currency – Euro. Initially it was launched as an option in 11 countries, and was taken up well by the people. Greece joined later to make it 12. Participating countries readily replaced their currency with Euro, with fanfare. By the year 2002, the demonitisation of local currencies was completed. There after eight more have switched, Croatia being most recent one in 2023.

The Zimbabwe story

Zimbabwe has had multiple attempts since 2008 to create a stable currency. In 2007 when government was in economic crisis, it simply started printing more currency to sustain itself. This led to so much flow of currency, that everything became too expensive. In 2008 government had to ditch its own currency, and allow use of foreign currency notes from US and South Africa. In 2015, it bought back all of its currency, and replaced it entirely with US dollar bills.

In 2019, Zimbabwe tried to introduce its own currency Zimbabwe dollar (ZWL) again, and this failed again. With little faith in how much currency was in circulation, prices rose up again. This move was shelved in another year. In 2024, the country introduced a new currency -ZiG (short for Zimbabwean Gold). replaced the Zimbabwean dollar. Since, people, industry as well as stock markets have no faith in the new currency (they believe that bank will simply start printing more), this also has rapidly moved to a failure.

When money disappeared in 2016…

On 8th November 2016, in India money became maya. Suddenly the 500 and 1000 rupee notes (85% of all currency in circulation) ceased to exist. These ceased bank-notes were allowed only for a limited transactions, and had to be either deposited or exchanged for the other existing , or new notes. Money seemed to have lost its value, and many were quick to trade it with gold, oil, or land.

The idea was perhaps to beat the counterfeit, or to bring unaccounted to accounts. Yet opinions are still divided if the move was good or bad. None-the-less, it shifted many a cash transactions to digital money. UPI that was launched as an experiment in the same year, now accounts for 75% of all retail transactions. But most cash that had immediately seemingly disappeared in 2016, is back in circulation.

So, did you find your own currency in the above stamps, and if so, which ones. Are these still around, or these are mere relics from the past ??