Alfred Amonn’s journal article examines the rationale, operation, and anticipated liquidation of the occupation currency introduced in Romania during the First World War. Moving from the general financing problems of military occupation to the new lei’s institutional design and the peace settlement, it explains how a currency could sustain circulation while transferring the costs of occupation and economic extraction to the occupied state.
Amonn begins by distinguishing military conquest from monetary necessity: occupation does not itself prevent an existing currency from circulating. The incentive to introduce new money arises instead from the occupier’s financing requirements. In a developed monetary economy, uncompensated requisitions threaten the continued operation of farms and businesses. Compensation, compulsory purchases, and the administration of seized enterprises require substantial cash, while contributions yield limited resources after wealthy inhabitants and banks have removed their funds. Using the occupier’s domestic money would intensify wartime inflation and leave it liable for the currency issued abroad.
The solution combines familiarity for local users with external financial backing:
Dieses Zahlungsmittel wurde nominell mit der alten Landeswährung, materiell aber mit der heimischen Währung der okkupierenden Macht verknüpft.
English translation: This means of payment was linked nominally to the old national currency, but materially to the home currency of the occupying power.
In Romania, the Banca Generala Romana issued new lei against mark or crown deposits placed at the Reichsbank by the requesting military authorities. The initial official equivalents were 0.80 marks or 1.20 crowns per leu. Amonn distinguishes the official exchange facilities available to military personnel from civilian bank transactions governed by supply and demand. This distinction exposes the limits of administrative rate-setting: depreciation in civilian dealings eventually prompted a revision of the official rates.
Backing, however, did not make the notes redeemable or prevent inflation:
Eine Einlösung dieser Leinoten in Kronen oder Mark wurde nicht vorgesehen.
English translation: No redemption of these lei notes in crowns or marks was provided for.
The deposits served as a restraint on expenditure and as a contingent fund against the liability created by issuance. Without a deposit requirement, Amonn argues, the occupiers would have lacked an incentive to economize. Yet notes issued for definitive payments, rather than credit linked to production and commodity circulation, still produced inflation, expressed in exchange depreciation and enormous price increases. His conceptual distinction is therefore between financial security for an issue and the economic conditions that sustain its purchasing power.
The peace settlement resolved the question of ultimate liability by obliging Romania to assume the entire issue and replace the occupation notes with National Bank money. Amonn states the distributive consequence directly:
Dadurch werden dann die für ihre Ausgabe bei der Reichsbank hinterlegten Guthaben für die Hinterleger frei, so daß diese die gesamten Werte, welche sie mit neuen Leinoten bezahlt haben, umsonst erhalten haben.
English translation: Thereby the balances deposited with the Reichsbank for their issue become free for the depositors, so that the latter have received for nothing the entire values which they paid for with new lei notes.
What had appeared as expenditure secured by the occupiers’ deposits thus became an acquisition ultimately financed by Romania. Amonn also criticizes the original exchange ratio for undervaluing the crown and artificially depressing its Romanian exchange value. Had the deposits been needed for redemption, Austria-Hungary would have borne an unfavorable burden; Romania’s assumption of liability removed that further consequence.
Despite recording inflation and exchange distortions, Amonn judges the arrangement successful in terms of circulation and the occupiers’ objectives:
Die neue Leiwährung übte ordnungsgemäß ihre Funktion als Umlaufsmittel und war nebenbei in den Dienst der wirtschaftlichen Ausnützung des Landes durch die okkupierenden Mächte gestellt.
English translation: The new lei currency duly performed its function as a medium of circulation and was, incidentally, placed in the service of the economic exploitation of the country by the occupying powers.
He notes its subsequent adoption in occupied northern Italy. The concluding figures sharpen the meaning of this success: an issue of roughly one billion lei at the beginning of peace negotiations might, he estimated, reach two billion by ratification. This represented the occupiers’ nominal gain from Romania’s assumption of the notes. Their real advantage was greater because goods sent to the hinterland had often been purchased below freely formed market prices.
The article closes with the envisaged transition from occupation money to Romanian state money, followed by replacement within six months of ratification. Its relevance lies in the close connection it draws between monetary administration and the distribution of war costs. Amonn’s account makes the currency intelligible both as a practical instrument for maintaining payments and as a mechanism for obtaining resources while shifting the final monetary liability to Romania.
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