Frank French

Although a part carrying the name of “franc” or “Franc with horse” existed as of on December 5th, 1360, the French franc was the single monetary unit of the France only between 1795 and on December 31st, 1998 (and the common monetary unit in Andorre and with Monaco). It succeeds indeed the Livre tournaments, which was the Unit of Account of the Ancien Mode, the franc not being whereas a currency of payment.

January 1st 1999, the franc became a national division of the Euro, the common currency. January 1st 2002, the franc completely ceased being Unit of Account, before ceasing its legal tender the next on February 17th (completely replaced by the euro become single currency); the coins and tickets in francs for summer have completely démonétisés.

Evolution of the purchasing power of the French franc

History

Under the Old Mode

The December 5th 1360, the frank first are struck to help to pay the ransom of the king Jean II the Good (captured by the English the September 19th 1356 with the battles of Poitiers). Named the Frankly with horse , it is acted in fact of a ecu drawn to 3 million specimens, weighing 3,87 Gram S of fine Or and being worth a Livre tournaments or 20 ground S. the king there is represented on a Destrier, is armed with one ecu with flower of lily and holding up the sword, with the term “ Francorum Rex ” (King of the Francs). Although the “frank” word means “free”, it is more probable than the name of the currency comes quite simply from this inscription.

In 1385, the franc is struck with the image of the new king Charles V. On a part of 3,06 grams gold, the monarch is represented with foot. This part is called the Franc with foot .

In 1575, the king Henri III makes strike a frankly money of 14,18 grams with 833/1000 being worth 20 grounds and four sums of money, is a value slightly higher than the Livre tournaments. At the same time, subdivisions of the franc are struck: the half-franc and the quarter of franc . It creates also an ecu of gold being worth 3 Tournois books as a monetary unit of account.

The king Henri IV emits, in 1586, a declaration prohibiting the striking of the francs. Only the subdivisions can continue to be struck. This décison is taken because the parts are often scraped to recover a little money.

The king Louis XIII makes emit half-francs and quarter of francs respectively of 7,094 G and 3,547 G money with 833/1000. Louis XIII decides to reform the monetary system in 1640 and on December 23rd 1641, the king makes strike a gold beautiful piece to which it gives his first name: the Louis of gold . The louis of money which results from this is called ecu ; the franc becomes an obsolete currency then. However, the “frank” term remains long-lived in the spirits; Molière, Boileau in their works employ the “frank” word for “book”, like Madam de Sévigné in the letters with his/her daughter.

Under the Revolution

The law of the 18 Nivôse year {{Romanian|III|3}} (January 7th, 1795) allows the emission of the first Assignat S made out in francs.

The law of the 18 Germinal year follows III|3 (April 8th, 1795), which débaptise the old woman Book tournaments (too pointing out the royalty) and decides that the official monetary unit of France is the frank . Its capacity is of 5 grams money. The law confirms the decimal system: a franc is subdivided in 10 ten-per-cent taxes and 100 centimes, but the currencies envisaged will never be struck.

With the law of the 28 Thermidor year III|3 (August 15th, 1795), the franc becomes the French monetary unit and détrône delivers it.

The law of the 25 germinal year {{Romanian|IV|4}} (April 14th, 1796) gives equivalences delivers/frankly: the book tournaments weighs 4,505 16 grams of money, and the franc 4,50 grams of fine money. The pound tournaments is thus slightly higher than the franc, and the law issues that the part of 5 francs is given and received for 5 books tournaments, 1 penny and 3 sums of money. The franc is worth thus officially 1 book tournaments and 3 sums of money.

In fact it is not a question of a swindle, because a study on an important quantity of books tournaments in circulation showed that, because of wear, the average weight was lower than 4,50 grams of money and accounted for 93% of the theoretical weight. To take account of this wear and to simplify the exchanges of parts, the franc is struck with 5 grams of money with 900 per 1000. Its value is thus of 1 franc for a book tournaments, or 20 grounds.

However, at the time, that takes time to change the currency. The production of coins is not enough with the request, the country suffers from a general lack of metals (gold, money but also copper and bronze). In particular, much emigrants left France with their noble metals. To accelerate the installation of the new currency, two measurements are installation:

a decree of the 2 Fructidor year IV|4 (August 19th, 1796) decides that the parts of balk of Louis {{Romanian|XV|15}} and of the former reigns can circulate for 2 pennies (10 centimes) but in practice the public accepts them only for 1 penny ½.
a recovery campaign of metals is implemented: patriotic gifts, confiscation of the goods of the emigrants, cast iron of the royal crockery, cast iron of the silverware and the goldsmithery of the churches and the abbeys, 30 000 bells are molten.

Lastly, as from 1796, the wars also will make it possible to make come from the metal masses of all Europe (45 million books in 1796).

The law of the 16-17 Floréal year {{Romanian|VII|7}} shift the principle of the primacy of the book tournaments, and forces to evaluate the royal currencies in francs and centimes when well even they would be stated in books/under/sums of money. It obliges accountancies and stipulations to be established in francs from the vendémiaire year {{Romanian|VIII|8}}. It gives the relative values of the currencies of the book tournaments, fixes the payment of engagements, revenues, provisions, etc It imposes that the salaries civils servant, the taxes, transactions, the acts between the private individuals, the retirements are expressed in francs.

Frankly Germinal

In 1800, Banque de France is created.

The 14 germinal year law XI (April 4th, 1803) makes it possible the services of the State to take again with the weight the cut down or deteriorated currencies. The decree of the 17 Meadow Year XI (June 6th, 1803) publishes a tariff of two pages for the recovery intended for the recoinage of moneys of gold and money of all the countries of Europe and almost all the countries of Asia.

The law of the 17 germinal year XI (April 7th 1803) institutes the bimetalism. The money returns to the honor: the Germinal franc, the 5 francs, the frank half and the quarter of franc are struck in this metal, but it is also struck parts of 20 and 40 francs out of gold, from where the name of “gold franc”. Banque de France becomes the issuing house priviligié.

France constituted a vast empire in Europe, and out of Europe, in which the franc largely circulates. Belgium, the Netherlands, Switzerland and the north of Italy are integrated there.

December 23rd, 1865, is created the Latin Monetary Union, in the form of a monetary association defining the principles of monetary uniformity in term of weight, titrates metal and course for the currencies of 4 countries (France, Belgium, Switzerland and Italy) to which joint Greece in October 1868.

The Germinal franc or gold franc is a very stable currency until in 1914, in spite of political instability in France and accompanies the development by the country and its richness, during 125 years, until in 1928 and the advent of “frank Poincaré”. Of 1879 with 1928, the gold franc of 0,322 5 G constituted the national monetary unit.

Frank Poincaré

The State spent much to finance the First World War. The war was to be short, therefore the extent of the expenditure had not been envisaged. Also, the selected solutions were not always the best, without counting, during nearly three years, the refusal to resort to the income tax. The expenditure planned for this short war was evaluated to 20 billion francs (the budget for 1914 is of 5 billion). The total expenditure related to the war rose to 140 billion francs. Only 15% are covered by the tax (of which the income tax voted in 1914 and applied in 1916-1917). One had initially recourse to the increase in the money supply. In 1914, there was 6 billion francs in circulation; in 1919 25,5 billion. The problem is that in parallel, Banque de France used the gold stock to cover the first expenditure. The cover of a currency guaranteed on gold thus decreased strongly. Another solution to cover the expenses of war was the loans: near the French population in the form of goods of defense (75 short-term, but always renewed billion) and 25 billion in long-term loans; there were also loans abroad: 40 billion in Great Britain and the USA. All that was not without consequences on the long run: inflation and loss of capital for the population French and average of pressure économico-policy for this same population with the goods of Defense, but also average of pressure économico-policy for the USA and Great Britain at the time of the peace negotiation.

The Germany, regarded as person in charge of the First World War, was condemned to pay repairs with the winners.

The France counted on repairs to balance its budget. The State financed the rebuilding and the compensations for the victims with a countable artifice: “Germany will pay”. Raymond Poincaré, which wanted an application integral of the Traité of Versailles, considered that Germany made very not to pay by following a policy of surinflation. To obtain the payment, Poincaré decided the occupation of the the Ruhr - the richest area of Germany - as from January 1923 to go to seek “a productive pledge”. The German government decided the passive resistance. That created in the country a hyperinflation. But France was insulated diplomatically and its currency was attacked on the worldwide markets by the USA, the Great Britain and Germany.

This speculation involved the defeat at the polls of Poincaré. It indeed applied Draconian solutions, which saved the Franc. Under the direction of the banker Raymond Philippe, at the origin of the formation of the committee of the experts, he was regarded as a financial magician thanks to this “financial Verdun”, but the Orders in Council of rigor (increased taxes of 20% and public economies) involved the dissatisfaction with the population and the electoral victory of the Trust of the Lefts.

It was however impossible with the Trust of the Lefts, for economic reasons and financial, to apply a true policy of left. The Trust had affirmed its will of a return to an integral secularity. The many catholic demonstrations were supported by the line and the extreme-right-hand side, like by the catholic hierarchy. The catholic newspapers required of their readers not to subscribe more to the Government loans, not to even renew their Treasury bills (often old goods of Defense in 3 months, always renewed until there).

The President of the Herriot Council had to go into reverse and yield to the financial pressure. The line had discovered the weak point of the government and was going to benefit from it. To finance its policy, and to cover the expenses related to the First World War, the government did not have enough with the loans and the goods. It thus called (for a very long time) upon Banque de France so that it made him advances on receipts: the government touched the amount of the taxes in advance, and refunded then Banque de France. This one had always accepted, and had always accepted also the going beyond of the fixed maximum amount: the ceiling of the advances. But Banque de France was a private banking directed by the mediums of businesses and financial (200 shareholders, pertaining to the 200 richer families of France), very opposite with the Trust. April 10th, 1925 Banque de France announced that the Trust had burst the ceiling.

Herriot says that the Trust had run up against the “Money Wall” and all the left criticized the 200 families. The Herriot government fell. It was the first time in the French history which a government fell on financial problems. The political importance of the mediums of businesses was again proven.

The Trust failed during almost a year. During this time, the financial crisis grew hollow: the book went up to 235 F in July 1926. One then decided to go to seek the financial magician: Poincaré.

He became president of the Council and Minister for Finance. Its economic policy (increase in the taxes and rationalization of the administration), always inspired by Raymond Philippe, brought back confidence and moved away the danger from the refunding of the goods. To avoid the return of such a danger, one decided the creation of sinking funds in charge of the management of the national debt, financed by taxes on the tobacco and of the lotteries. The franc was rectified and returned in December 1926 to 122 francs for 1 book. The idea of the government and Banque de France was to stabilize the currency with 120 francs for a book and to restore gold convertibility. Rather than a policy of long and expensive revalorization (the problems of Great Britain having chosen this solution to bring back the convertibility of the gold book remained a model-driving bolt), the choice of the devaluation was made. One however awaited the electoral victory of Poincaré to the elections of 1928. Frank Poincaré was then set up. It was worth 1/5e Germinal Franc. This devaluation allowed the conquest of exterior markets, but put an end to the illusion of one return to the Beautiful Time.

New franc

Returned with the capacity in June 1958, the general De Gaulle decides to reform the economic and constitutional structure country, and entrusts to the Minister for Finance Antoine Pinay and to the economist Jacques Rueff the mission of creating a “revalued franc”, simultaneously with a news Dévaluation of 17,5%, the seventh since the Libération. This “new franc” will be worth 100 “old francs”; thus a product with 519 (old) frank will cost from now on 5,19 (new) frank, or 5 francs and 19 centimes (division by 100). This franc is sometimes called frankly Pinay or frankly De Gaulle .

December 27th 1958: adoption of the Plane Pinay-Rueff which aims at the creation of new franc.
1 {{er}} January 1960: putting into circulation.

In 1963, the new one franc is simply called “frankly”.

Passage à l' Euro

The fate of new franc is sealed by the ratification of the treated of Maastricht in 1992, envisaging a single currency managed by the European Central bank. After 44 years of use, the new one franc is replaced since January 1st 1999 by the Euro (on January 1st 2002 for the parts and tickets) at the convertion rate of 6,55957 FRF for 1 euro, and does not have any more legal tender since the February 17th 2002.

In addition to the France, the French franc was also used in principality of Andorra and principality of Monaco.

References

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