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Saturday, 26 January, 2002, 18:33 GMT
Goodbye to the guilder
250 guilder note
Many people will miss the brightly coloured notes
Just four weeks after the introduction of the euro, the guilder is no more - the first of the eurozone's 12 national currencies to be swept into oblivion.

It ceased to be legal tender at midnight on Sunday local time.

Its demise marks the end of one of Europe's longest monetary traditions.

The coin dates back to the 14th Century when Dutch provinces first minted their own versions of the Florence coinage, the florin, which had by then spread to northern Europe, and called them guilders.

But the guilder really came into its own in the 17th Century when the northern provinces of the Netherlands broke free of Spanish rule.

The century was a golden age for the Netherlands. Dutch merchant ships dominated the seas and at home, people grew rich on the booming trade in tea, spices and diamonds.

Tulip fever

The Netherlands emerged as the banking centre of Europe and one of the first modern stock exchange systems was established in Amsterdam.

Amateur speculators flocked to put their guilders into tulips
While stocks and shares served the investment needs of wealthy merchants, other groups in society were also keen to use their guilders to indulge in some market speculation. And they found the perfect object for their enthusiasm - tulips.

The bulbs were the embodiment of Dutch aspirations, and "tulip fever" meant the trade in them took on the proportions of a parallel stock exchange.

Bulbs of the most prized variety, the Semper Augustus, traded at around 2,000 guilders and even up to 6,000 guilders at the height of tulip fever.

At the time annual incomes were between 200 and 400 guilders and a small town house cost around 300 guilders.

The boom was followed by the inevitable bust. In 1637, the Dutch tulip market witnessed the first stock market crash in history, leaving amateur investors bankrupt.

Silver pieces

The guilder, however, survived and its dominance gradually pushed the other remaining currencies out of use in the Netherlands.

In 1816, with the return of William of Orange following Napoleon's occupation, the government took measures to protect the guilder's value by introducing the inscription "God be with us" on the rim of the coins.

The aim was to stop people shaving slivers off the edges of the coins and pocketing the precious silver, thereby reducing the currency's intrinsic worth.

During World War I people began to hoard their silver coins and as a consequence currency circulation was significantly restricted. By the end of the war, the price of silver had soared and so the face value of the coins had become lower than the actual value of their silver content.

The government feared that people would begin melting down their coins instead of using them and so new ones, bearing a different portrait of the queen, were issued.

Dark days

With the Nazi occupation in World War II, the guilder was abolished.

The authorities took steps to transfer the currency to Germany and issued an order to hand in the old silver coins, substituting them for bank notes, known as "silver vouchers", and zinc coins.

Queen Beatrix
The traditional portrait of the Dutch queen still appears on the euro coins
But the project was thwarted by a radio appeal from the Dutch Government in exile, pledging that the guilder would still be legal tender after the war.

In the end, few people handed in their coins to the Germans but the exiled government realised that extra supplies would nevertheless be needed to replace those which had been collected.

Acquiring the metal to produce new coins during wartime was not easy, but finally the several hundred million guilder coins were minted in the United States in 1944.

Once produced, the coins - which had a total value of 193.5m guilders - still had to get across the Atlantic. They were divided into 40 separate shiploads to spread the risk of them falling victim to a German attack.

Allied soldiers brought the coins with them when they liberated the Netherlands. But, as in World War I, people quickly began to hoard the silver and distribution was halted.

In 1948 the silver coins were finally made obsolete and nickel coins were brought in.

See also:

27 Jan 02 | Business
Dutch spend their last guilders
26 Jul 01 | Business
Dutch relax over euro launch
05 Jan 02 | Business
Euro sweeps up old currencies
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