Euro coin row: France wins the battle, Belgium wins the war

Euro coin row: France wins the battle, Belgium wins the war



Belgium minted 180K 2 Euro commemorative coins to celebrate Napoleon's defeat. France was miffed at this reminder of a defeat of a French hero before the EU and nixed the coins so they had to be destroyed. Belgium found a loophole that allowed them to produce an "odd denomination" of 2.5 Euros that would only be legal tender in Belgium. So they minted 70K of them.

Of course, this veto works both ways, and to celebrate the 500th anniversary of the French victory at Marignano, the French cannot produce a commemorative 2 Euro coin as their plan was nixed by Italy. It has not been decided if they will follow Belgium and introduce a new coin.

But could actual monetary policy be determined this way? The Euro banknotes are denominated 5,10,20,50,100,200 and the soon to be discontinued 500. Could Greece issue casino chips of value 3,15 and 30 Euros that would only be valid in Greece? These three value would correspond approximately to the old banknotes.

1,000 drachmae 2.93 euros
5,000 drachmae 14.67 euros
10,000 drachmae 29.35 euros

Perhaps 3 Euros would be useless since it is too small of a value, but the 15 and 30 Euro casino chips would not leave Greece so they can keep some cash inside the country.

The banknotes in Greece in the year 2000 before the changeover were 300,000 drachmai per capita, so you would need thirty 30 Euro commemorative coins per person to restore that cash balance. The money would circulate alongside the regular Euro banknotes and coins, but these commemorative casino chips would not be legal tender outside of Greece.

Collectors would take some of them out of circulation in exchange for some liquid cash. As long as the cost of minting the "commemoratives" doesn't exceed their face value, it's a good deal for everyone (except the citizen who needs to exchange the commemorative for regular euros before they cross the border).

Quote: Ayecarumba

Collectors would take some of them out of circulation in exchange for some liquid cash. As long as the cost of minting the "commemoratives" doesn't exceed their face value, it's a good deal for everyone (except the citizen who needs to exchange the commemorative for regular euros before they cross the border).

Here is a special commemorative 2 Euro coins made in Greece for the Olympics


Here is a special commemorative 30 Euro coins made in Spain out of precious materials.



If these Greek 30 Euro coins were not made of precious materials, than collectors wouldn't want them. I know it is not the intent of commemorative coins to be used for monetary policy, but 30 Euros ~ 10,000 drachmas. You could even print some stylized version of 10,000 drachmas. If you issued 30 coins for each of 10 million citizens in Greece that would equal the amount of drachma banknotes that were circulating in the year 2000 before the changeover. The face value would be nearly 9 billion Euros.

These coins would function like regular money, but they wouldn't leave the county. You wouldn't have those photos of Greeks lining up at ATMs every day, to withdraw their quota of cash.




I am sure if every country did that it would massively destabilize the Euro, but if you look at the amount of banknotes circulating in the pre-Euro currencies, Greece had a relatively small proportion of the 380 billion Euros circulating.

Millions Year 2000
134,004 E German Mark
75,064 E Italian Lira
57,234 E Spain Pesetas
46,061 E French Franc
17,436 E Dutch Guilder
13,934 E Austrian Schilling
12,905 E Belgian Franc
8,912 E Greece Drachma
6,187 E Portuguese Escudo
4,996 E Irish Pound
2,931 E Finnish Markka
96 E Luxembourgish Franc (use Belgian Franc)
379,760 E Euro-Area