Rentenmark

The Rentenmark was a temporary German currency introduced in November 1923 to halt the runaway hyperinflation that had plagued the Weimar Republic. It served as a stabilizing measure to restore confidence in money and prices while a longer-term monetary framework was prepared.

The Rentenmark was issued by the Reichsbank and was explicitly backed by real assets. The backing consisted of mortgage bonds tied to land, industrial property, and other real estate—often referred to as Rentenpfandbriefe. This asset-based backing gave the new currency credibility and helped separate its value from the collapsing Papiermark supply.

In its initial arrangement, a strict conversion rate was set to rebuild trust: 1 Rentenmark was equal to a substantial amount of old Papiermark, commonly cited as about 1 trillion Papiermarks. The supply of Rentenmarks was deliberately limited to prevent re-emergence of inflation, and its value was anchored to the value of the underlying mortgage assets rather than to government credit alone.

By 1924, the Rentenmark began to be replaced by a permanent currency known as the Reichsmark, at parity (1 Reichsmark equal to 1 Rentenmark). The reform established a more stable monetary system and laid the groundwork for regained price stability in Germany during the mid- to late-1920s.

Impact and significance: The Rentenmark played a crucial role in ending the hyperinflation crisis, restoring public confidence in money, and enabling broader economic stabilization. It represented a shift from money supply expansion tied to government finance toward asset-backed stabilization anchored in real estate and industry.