Yes, they even had them in Europe in the 17th Century, they called this one “Tipper and See-Saw Time”, that was the name given to a financial crisis during the start of the Thirty Years’ War (1618-1648).
It occurred as the city-states in the Holy Roman Empire began to debase their currency, in order to raise funds to fight the Thirty Years’ War, you see at this time effective taxation did not exist.
The effect of the crisis spread from Germany to Austria, Hungary, Bohemia, Poland and, even, Russia.
In those days money was in the form of metal coins.
What is interesting about this financial crisis, which was called “Kipper und Wipperzeit”, the English translation is Tipper and See-Saw, is that was the metal coins that were debased, not paper money.
The Cause.
It was a financial crisis created by the Thirty Years’ War (1618–48).
You see at this time Europe’s city-states were all part of the Holy Roman Empire, therefore when the Empire was at war they had to fund it. However, they didn’t have lots of money and had to find another way that would generate enough to allow the war to continue.
How did the City-States raise the money?
This is what started the financial crisis, you see, they all cheated!
It started with one state, then others followed.
How did they cheat?
A City-State decided to devalue their currency in a devious way. The value of a coin was based on the value of the metal in it, the more valuable the metal the more valuable the coin.
Therefore, one City-State realised they could copy the currency of another city-state, create coins that looked like that other City-States coins but with lower value metal. They decided that so long as it looked the same who would know?
They then figured that if they spent these coins in another state, especially if it was one a long way away from theirs, nobody would know and they would be making money.
To start with it worked, then!
Others copied them, and more and more mints were established, in fact, too many of them. Mints appeared all the way from Germany to Austria, Hungary, Bohemia, and Poland. The result was that very quickly the debased metal coins became so worthless that children played with them in the street.
Inevitably, the general public, when they learnt what was happening, weren’t happy. This led to riots and then to the refusal of soldiers and mercenaries to fight unless paid in “real”, non-debased money.
Then another problem arose as so many states were debasing their currency, yes, the inevitable happened, City-States started to get their own debased coins back!
It had to end.
Due to all these problems the practice was mainly stopped around 1623, however, the damage done was so large that it created financial disarray in almost all the city-states in the area.
Where does the name Tipper and See-saw time come from?
To find those coins not yet debased, tipping scales were used to differentiate between the good and the debased ones. Hence the name, it was to identify not-yet-debased coins, while the scales were used to take out of circulation the dodgy ones.
Isn’t it interesting to find that there have been financial crisis for many centuries.
Isn’t History Fun?
10 Questions about the Blog on “Tipper and See-Saw Time”:
- What was the name of the financial crisis that occurred during the Thirty Years’ War?
- What caused the city-states in the Holy Roman Empire to debase their currency?
- How did the city-states devalue their currency?
- What happened to the value of the debased coins over time?
- How did the public react to the debasement of the currency?
- What were the long-term effects of the “Tipper and See-Saw Time” on the city-states?
- What is the literal meaning of the German term “Kipper und Wipperzeit”?
- How were the good coins distinguished from the debased coins during this period?
- Why is it interesting to learn about this historical financial crisis?
- What other historical examples of financial crises can you think of?
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©Tony Dalton