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Kipper und Wipper (German: Kipper- und Wipperzeit, literally "Kipper and Wipper time") was a financial crisis during the start of the Thirty Years' War.[1] While debasing of mint was observed earlier, with the onset of the war the military expenditures rose drastically and the city-states in the Holy Roman Empire began to heavily debase currency in order to raise revenue. The most severe debasing occurred in around 1620-1623. After that time the authorities attempted to curb inflation and debased coins were declared illegal and withdrawn from circulation.[2][3]
The name refers to the use of balance scales (Wippen) which quickly titled (kippen) on good coins.[2]
History
editThe not-yet-debased coins were then taken out of circulation, melted, mixed with baser metals such as lead, copper or tin, and re-issued. Often the states did not debase their own currency, but instead manufactured low-value imitations of coins from other territories and then spent them in yet other territories as far as possible from their own lands, hoping that the resulting damage would then occur to the economy of those other regions rather than their own.
This worked for a while; but after a time, the general public caught on to the manipulation, resulting in pamphlets denouncing the practice, local riots and the refusal of soldiers and mercenaries to fight unless paid in real, non-debased money. Also the states began to get back their own debased coins in taxes and customs fees. Due to these problems the practice largely stopped around 1623; however, the damage done was so large that it created financial disarray in almost all the city-states in the area. The same thing re-occurred on a smaller scale near the end of the century and again during the middle of the 18th century; however, the debasement spread from Germany to Austria, Hungary, Bohemia, and Poland.
During Kipper und Wipper, there were two forms of debasement. To finance the Thirty Years' War, which was occurring simultaneously, coins were either shaved down or melted. By clipping or shaving coins, the amount of silver or precious metal in the coin decreased. Additionally, by melting coins, mixing them with lesser metals, making new coins, and circulating them, the nominal value, face value, greater deferred from the melt value or value of the metal in the coin.
A major decision made between cities that resulted in the creation of more mints and eventually more debased coin was when six cities decided to allow the establishment of more mints, a place to manufacture coins and money. By doing so, mints were able to mint more debased coins.
Many states in Europe tried to finance their war efforts through debased coins. Charles P. Kindleberger wrote, "Bad money was taken by debasing states to their neighbors and exchanged for good." Referring to good money, he said that states would mint debased coins, exchange it in a neighboring state, and bring good coins back. This brought in coins that had a higher content of silver. However, the neighboring states also debased their coins to prevent a loss of money. This resulted in hyperinflation, the rapid increase of prices in a short period of time, which eventually became a crisis throughout many states in Europe as debased coins spread rapidly from state to state.[citation needed]
The years 1620–1623 saw famine in Germany, often attributed to Kipper und Wipper among other causes.[4]
During the period of crisis, many methods were thought of to prevent the debasement of coins and to prevent Gresham's law, which states that coins with a lower melt value or intrinsic value circulate faster and better than coins that have a higher melt value.
In Europe, the import of bad coins and the export of good coins were enforced by punishments such as banishment, burning, or the confiscation of goods.
Price history
editThe following table shows the exchange rate trend between the full-value Reichsthaler and the debased Kreuzer:
| Year | Reichstaler–Kreuzer Exchange Rate |
|---|---|
| 1566 | 68 |
| 1590 | 70 |
| 1600 | 72 |
| 1610 | 84 |
| 1617 | 90 |
| 1619 | 124 |
| 1620 | 140 |
| 1621 | <390 |
| 1622 | >600 regional >1000 |
| 1623 | 90 |
The development of the number of groschen payable in the Weimar region for a Reichstaler struck according to the Imperial Coinage Standard, covering the period from 1609 to 1623, is presented in the article Münzstätte Neustadt an der Orla.[5]
References
edit- ↑ "'Kipper und Wipper'. Rogue Traders, Rogue Princes, Rogue Bishops and the German Financial Meltdown of 1621–23" Archived 2012-08-16 at Archive-It, Mike Dash, Smithsonian, March 29, 2012
- 1 2 "The German economic crisis of 1618 to 1623", Bundesbank
- ↑ Wörterbuch der Münzkunde, 1970pp.306,307
- ↑ Collet, Dominik; Krämer, Daniel (2017). "5 - Germany, Switzerland and Austria". Famine in European History. Cambridge: Cambridge University Press. pp. 105, 117. ISBN 9781107179936. Retrieved 2025-04-05.
- ↑ Paas, Martha White; et al. (2012). The Kipper und Wipper Inflation, 1619–23: An Economic History with Contemporary German Broadsheets. Yale University Press. JSTOR j.ctt5vkvvf. Retrieved 4 June 2026.
External links
edit- Kindleberger, Charles P. (1978), Manias, Panics and Crashes. A History of Financial Crises, New York, ISBN 0-465-04380-1
{{citation}}: CS1 maint: location missing publisher (link) - Dool, Donald H. (December 2001), "Coppers hail from kipper und wipper period", World Coin News: 34–38
- Kindleberger, Charles P. The Economic Crisis of 1619 to 1623. The Journal of Economic History, vol. 51, no. 1, 1991, pp. 149–175. JSTOR, www.jstor.org/stable/2123055.
- "“Kipper und Wipper”: Rogue Traders, Rogue Princes, Rogue Bishops and the German Financial Meltdown of 1621–23" Archived 2012-08-16 at Archive-It, Mike Dash, Smithsonian, March 29, 2012
- MoneyMuseum.com