Paper Money

East German notes’ strange journey

Heavy equipment is being used to dump large quantities of East German marks into sandstone caves after the fall of the Berlin Wall in 1989.

Image courtesy of Kreditanstalt für Wiederaufbau.

On July 1, 1990, eight months after the fall of the Berlin Wall, the East German mark ceased to exist.

The 16 million citizens of the soon to be nonexistent country then had until July 6 to convert their East German marks held in cash to West Germany’s deutsche mark on a one to one basis. But it wasn’t that easy. The limit for most people, except those over 60, was 4,000 marks. The rate for amounts above that was cut in half.

A total of 600 million marks, or approximately $333 million worth of the notes, were not redeemed. Most of them are not rare today. Though not worthless, they are readily available from dealers and on Ebay at reasonable prices. 

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Deutsche Welle, Germany’s international broadcaster, asked another question last month. What happened to the East German marks that were turned in? The answer for coins was easy — they were melted, mostly for their value in aluminum. The paper currency was more problematic. What do you do with 620 million worthless bank notes? 

In 1991, they were all taken and dumped into a pair of sandstone caves near the historic town of Halberstadt in Saxony-Anhalt, close to the former West German border. There, it was thought, the humidity combined with the already miserable condition of most of the notes (except for the printed but never-issued 200- and 500-mark notes), would cause them to decompose. The problem would go away by itself.

The self-destruction didn’t go as planned. Thieves were able to break into the caves, and soon, in the mid- to late 1990s, 200- and 500-mark notes began showing up on the collector market.

Finally, in March 2002, the Kreditanstalt für Wiederaufbau (KfW), a government-owned development bank, that had been responsible for the notes since 1994, sent in bulldozers. 298 truckloads of notes were hauled off to an incinerator where they were burnt along with normal household trash. But the unissued high-denomination notes kept on showing up, with dealers paying around €15 each for them. Deutsche Welle says police were finally able to confiscate millions of them. They are now safely in repose in Berlin in what the director of KfW’s historical archive says is “one of the most beautiful places in the capital.” 

The 200- and 500-mark notes are still readily available from dealers in Germany for less than $20 each in Uncirculated condition.

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