It may seem hard to believe in these days when the West German mark is in great demand, but 30 years ago West Germans had to be enticed to accept the new deutschemark by getting a favorable exchange rate on the Century-old Reichmark.
With the mark now having doubled in value to almost 50 cents from its introductory rate, West Germany paused yesterday to note the remarkable three-decade success story of its post-war currency.
To celebrate the prosperity that the mark has come to symbolize for a nation that lay in ruins in 1945, the elite of West German industry, finance, politics and government met here in historic Saint Paul's church.
Looking out into a sea of nearly 1,000 dark blue suits and starched white shirts, the President of West Germany's Federal Bank, Otmar Emminger, told the gathering that the birthday child is out of the danger zone. It has gained world-wide recognition and great attraction."
That is hardly news to anyone who has watched the value of the German currency double in comparison to the U.S. dollar in the last decade.
But Emminger's remarks and others made here yesterday serve to underscore the extraordinary transition of West Germany from devastation to a citadel of Western consumerism that began unexpectedly for the German public on June 20, 1948.
It was then that the Western Allies, working in secret with West German economic experts, spring a revolutionary currency reform on the West German population that included the birth of the new deutschemark.
Under currency reform, West Germans began lining up at the banks the next day to exchange reichmarks at a very favorable rate for the new deutschemark.
The results, were extraordinary both economically and psychologically. Hoarding gave way to wellstocked shops as confidence grew and the legacy of the Hitler-era money faded. By the 1960s, it would be known around the world as West Ger wirtschaftswunder - the Economic Miracle.
West Germany's economic weapon at the time was Ludwig Erhard, the financial expert working with the Allies who was called "the father of the deutschemark" and who would go on to become West Germany's second postwar chancellor.
Erhard was convinced that more reform was necessary other than just new currency. Acting on his own and in a move that angered the Allies, he abolished rationing and price controls overnight, declaring that if you "turn the people and the money loose, they will make the country strong."
Erhard's action angered the left-wing in West Germany and scared many others who never had any experience with what Germans now call their free-market economy.
From the days when a pack of Lucky Strikes could buy almost anything here in 1946, the deutschemark has gone from four-to-the-dollar in the 1960s to just above two-to-the-dollar now. The mark, along with the Swiss franc and Japanese yen, is among the strongest currencies in the world.
The new mark was the signal of even more historic changes to come. For the first time in German history the Western two-thirds of Germany, then occupied by three Allied powers, had a different currency from the eastern third which was the Soviet zone. The currency reform preceded by more than a year the formal division of Germany into two nations, the Federal Republic of Germany founded in September 1949 in the West and the German Democratic Republic in the east in October 1949.
When he is asked today what explains the German economic stability and the deutschemark's strength, Emminger says it is part luck - lucky that the right man, Erhard, was there at the right time. He adds that is also partly due to what has, until now at least, been a broad consensus of the major social groups in West Germany, especially industry and labor.
A third crucial factor he said today was that West Germany had gone through the global turbulence caused by the 1973 oil crisis with an economy in much better shape and more disciplined than most other countries.
Yet economic growth her ehas slowed dramatically in the past two years, in part because the mark is so expensive overseas. Some West Germans fear the mark will be dragged into the same kind of problems that afflict the dollar because it has become one of the world's reserve currencies along with the dollar.