Anne: Hi, I’d like to change some money please.
Teller: Sure. What currencies would you like to change?
Anne: US Dollars into Euros, if I could.
Teller: Of course. How many dollars would you like to exchange?
Teller: Right, let’s see. The current exchange rate is 76.5 euro cents to the dollar, so $1000 comes to €765.
Anne: Could you give me some small notes in that?
Teller: No problem. (counting money) So, here is 5 hundreds, 3 fifties – making 650 – 3 twenties , making 710, 4 tens which brings us to 750, and 3 fives. Check that, and can I help you with anything else?
Anne: No, that’s all, thanks.
Philip: Hi there. Can I cash travellers’ cheques here?
Teller: Sure. How much do you have, and what currency would you like it paid in?
Philip: I’ve $500. Can I get sterling please? And can I get some small bills in that?
Teller: Sure. Now, we’re buying at 61p to the dollar, so $500 comes to ₤308.81. I’ll include a hundred in tens and twenties for you (counts out money). And can I do anything else for you?
Philip: Yeah, I was wondering whether I could also pick up some Korean Won.
Teller: We don’t have any won on site at the moment, but we can order some in for you. It’ll take about a week.
Philip: I was hoping to get it sooner.
Teller: OK, well there is a bureau de change downtown on the corner of Kings Street and Woodhead Street. They usually hold a larger variety of currency. You can ask there.
Philip: Right, I’ll give them a go. Thanks for your help.
For several years I have collected currencies from around the world. My favourites are currencies that do not exist anymore – German Marks, Greek Drachma – and currencies from very small countries. I also like unusual money: Japanese coins with holes in the middle, and Irish notes that feel like plastic. Older coins and notes are also interesting because I like to see how the different designs have changed.
Sometimes the Royal Mint in the UK, or the United States Mint in America, make collectors coins for special occasions, although I don’t think these are so exciting; after all, the thrill of collecting is to find things by one’s self, not be told to collect. That said, I do have a commemorative ‘Jackie Robinson $5’, which I have heard may be worth some money.
In today’s frenzied financial market, currency rates may look like just another fluctuating number; however, if one looks at currency rates over a longer period of time, they become clear signs of a country’s financial strength.
In the early 20th century, when the British Empire was strong, the pound equated to nearly $5; by the beginning of the 21st century, it was only just over $1.5. China’s strong economy in the early 21st century has moved it from 15rmb to the pound to 10rmb to the pound in a decade (interestingly, until opening in the 1980s, China simply decided its own currency rate – usually around 2rmb or 3rmb to the dollar).
Sudden currency changes, however, can be a disaster. Germany’s economy, famously, went into meltdown after WW1 when it was bankrupt but still had to pay ‘reparations’ to the winners of the war: from 8.91 Marks to the Dollar in 1918, it was 320 by the start of 1922, 800 by the end of the same year, and (after countries began taking German goods, not money) 1 trillion by the end of 1923. A glass of beer cost 4 billion marks. Money was so useless that people used it for wallpaper. Zimbabwe had even bigger hyperinflation in 2008: by October $1US equaled over $Z2.5b. When, in November, inflation went up another sextillion percent, Zimbabwe, like Germany, abandoned the currency.
(the history of China’s exchange rate can be seen at http://intl.econ.cuhk.edu.hk/exchange_rate_regime/index.php?cid=8)