Money Fun Facts # 1 – Largest Numerical Denomination Bill Ever!Posted: October 30, 2012
Money Fun Facts # 1 – Largest Numerical Denomination Bill Ever!
Largest numerical denomination bill ever is 1 Milliard Hungarian Pengő (1,000,000,000,000,000,000,000) in 1946. It was only worth twenty cents US! Hyper-Inflation is rough.
Yes That’s – 1,000,000,000,000,000,000,000
The pengő (sometimes written as pengo or pengoe in English) was the currency of Hungary between 1 January 1927, when it replaced the korona, and 31 July 1946, when it was replaced by the forint. The pengő was subdivided into 100 fillér. Although the introduction of the pengő was part of a post-World War Istabilisation program, the currency survived only for 20 years and experienced the most serious hyperinflation ever recorded.
|Central bank||Hungarian National Bank|
|User(s)|| Kingdom of Hungary
Republic of Hungary
|Banknotes||10 000, 100 000, 1 million, 10 million, 100 million, 1000 million milpengő;
10 000, 100 000, 1 million, 10 million, 100 million, 1 billion b.‑pengő
|Printer||Hungarian Banknote Printing Corp.|
|Mint||Hungarian Mint Ltd.|
|This infobox shows the latest status before this currency was rendered obsolete.|
The Hungarian participle pengő means ‘ringing’ (which in turn derives from the verb peng, an onomatopoeic word equivalent to English ‘ring’) and was used from the 15-17th century to refer to silver coins making a ringing sound when struck on a hard surface, thus indicating their precious metal content. (The onomatopoeic word used for gold coins is csengő, an equivalent of English ‘clinking’ meaning a sharper sound; the participle used for copper coins is kongó meaning a deep pealing sound.) After the introduction of forint paper money in Hungary, the term pengő forint was used to refer to forint coins literally meaning ‘ringing forint’, figuratively meaning ‘silver forint’ or ‘hard currency’.
At the beginning of the First World War precious metal coins were recalled from circulation, and in the early 1920s all coins disappeared because of the heavy inflation of the Hungarian korona. The name pengő was probably chosen to suggest stability. However, there was some controversy when choosing the name of the new currency, though the majority agreed that a Hungarian name should be chosen. Proposals included turul (a bird from Hungarian mythology), turán (from the geographical name and ideological term Turan), libertás (the colloquial name of the poltura coins issued by Francis II Rákóczi), and máriás (the colloquial name of coins depicting Mary, patroness of Hungary).
The denomination of the banknotes was indicated in the languages of ethnicities living in the territory of Hungary. The name of the currency was translated as follows: Pengö (pl. Pengö) in German, pengő (pl. pengi) in Slovak, пенгов (pl. пенгова) in Cyrillic script Serbo-Croatian, пенгыв (pl. пенгывов, later пенге) inRusyn, and pengő (pl. pengei, later penghei) in Romanian. Later pengov (pl. pengova), the Latin script Serbo-Croatian version was also added.
The symbol of the pengő was P and it was divided into 100 fillér (symbol: f).
Introduction of the pengő
After the First World War, according to the Treaty of Saint-Germain, the Austro-Hungarian Bank (the joint bank of the Monarchy) had to be liquidated and the Austro-Hungarian krone had to be replaced with a different currency, which in the case of Hungary was the Hungarian korona. This currency suffered a high rate of inflation during the early 1920s. A stabilisation program covered by League of Nations loan helped to bring down inflation, and the korona could be replaced in 1 January 1927 by a new currency, the pengő, which was introduced by Act XXXV of 1925 It was valued at 12,500 korona, and defined as 3,800 to one kilogram of fine gold – which meant that the pengő was pegged to the gold standard, however, without exchange obligation. In the beginning the cover ratio (which included gold and – to 50% – foreign exchange) was fixed at 20% which had to be raised to 33.3% within 5 years. This goal was reached quickly: the cover ratio was 51% in 31 July 1930. Later it decreased somewhat due to the economic and financial crisis caused by the Great Depression. Until then the pengő was the most stable currency of the region.
After the Great Depression
The effects of the Great Depression reached Hungary after 1930 and it hit predominantly agriculture. The pengő had to be devalued and the debt of the country increased. After a short period of recovery, the war preparations – amongst which the most important was the Győr-program – had loosened the financial and monetary discipline which in turn led to the depreciation of the pengő currency. The territories given back to Hungary by the Vienna Awards in 1938 and 1940 were economically less developed, which was an additional aggravating factor regarding the economic situation of the country.
World War II
The war caused enormous costs and, later, even higher losses to the relatively small and open Hungarian economy. The national bank was practically under government control, the issue of money was proportional to the budget demands. By this time, silver coins disappeared from circulation, and, later, even bronze and cupro-nickel coins were replaced by coins made of cheaper metal. In the last act of the world war, the Szálasi government took control of banknote printing and issued notes without any cover, first in Budapest, then in Veszprém when Budapest had to be evacuated. The occupying Soviet army issued its own military money according to the Hague Conventions.
The pengő lost value after World War II, suffering the highest rate of hyperinflation ever recorded. There were several attempts to break down inflation, such as a 75% capital levy in December 1945. However, this did not stop the hyperinflation and prices continued spiralling out of control, with ever higher denominations introduced. The denominations milpengő (1,000,000 pengő) and b.-pengő (pronunciation: bilpengő) (1,000,000 milpengő, 1,000,000,000,000 pengő or one billionpengő (long scale)) were used to alleviate calculations, cut down the number of zeros and enable the reuse of banknote designs with only the colour and denomination name changed.
End of the pengő
The Hungarian economy could only be stabilized by the introduction of a new currency, and therefore, on 1 August 1946, the forint was reintroduced at a rate of 400 000 000 000 000 000 000 000 000 000 (400 octillion) = 4×1029 pengő, therefore the total amount of circulating pengő notes had a value of less than 0.1 fillér. The exchange rate to adópengő was set at 200 000 000 = 2×108 (hence the 2×1021 ratio, mentioned above). The exchange rate for the US dollar was set at 11.74 forints.