A Run for the Money

All over France last week peasants and townsmen flocked to counters staffed by harried people and sweatily traded old money for new. They were joined by all U.S. servicemen and women who were not flat broke. The Finance Ministry had decreed a new paper currency issue. All old notes of 50 to 5,000 francs would be invalid after June 16. Purpose: to perk up France's drooping finances by clearing lost or destroyed bank notes off the books; to smoke out black-market and other illegal war fortunes, and hoarding; to cancel French currency still in German hands or otherwise "irregularly" held abroad.

Only 6,000 francs ($120), plus 3,000 for each dependent, could be immediately redeemed by each person. For all old money turned in over that amount, receipts were issued payable after June 16. The new money instantly became more desirable than the old, because it was valid indefinitely and did not have to be accounted for. Merchants were reluctant to take old money, but they tried to give it in change. Black-marketeers selling new money for old collected a 20% premium.

One trick that many a canny Frenchman tried was to place old money on a horse expected to be scratched from a race at Longchamp--hoping that his bet would be returned in new money. (The trick failed.) People with servants redeemed extra money by sending their servants out with extra amounts. Finance Minister Rene Pleven was cheerful, but the staid old Bank of France considered the whole business a mess.

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