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In the days of the Frankfurt Gold Fix, gold managed that feat only 15 times in total. And if you think the Gold Market action so far this month has been frantic, just check how violent the action was either side of those DM peaks back in the early 1980s.

In the first run up during the global inflation panic sparked by the second Opec oil crisis, the Iranian hostage crisis, and the Soviet invasion of Afghanistan of late Jan. 1980 the Gold Price in Deutschemarks doubled in less than four months.

It then dropped 23% of its value for West German investors inside two days!

Rocketing higher again, the price of gold recovered the 40,000 DM level in late Sept. 1980 but only for five days. Gold then touched that level once again for two sessions the following winter, slipping back from 40,000 DM per kilo on 3rd Feb. 1983.

It took another quarter century to get there again. And in the meantime, gold lost value almost every year until the Central Bank Gold Agreement capped government gold sales in mid 1999. The monetary metal ticked gently higher from there to the start of 2005, before breaking out and doubling to 40,000 DM late last month.

Monetary stability is linked up with general social stability and with political stability, as Otmar Emminger said in his inaugural speech upon becoming president of the Bundesbank in 1977. Who could ask a bundle of notes and coins to do more?

The German public, as the economist Rudolf Richter noted in an essay of 1999, after losing their savings twice within 25 years (1923 and 1948), definitely wanted a stable currency. No Bonn government in its right mind would have put the Bundesbank under pressure.

Hence the West German central bank's mandate to cap consumer prices by capping the supply of money itself. Memories of the Weimar inflation that followed World War One plus the worthless Nazi Reichsnotes piled up during World War Two still stand in sharp contrast with the American media's obsession with the Great Depression.

Where Ben Bernanke now sees soup kitchens and deflation, the central bankers working to defend the German currency in Bonn for five decades could only see runaway inflation of the money supply. Twice.

In 1923, when Germany could no longer pay its First World War reparations, writes Mike Hewitt on his DollarDaze blog, French and Belgium troops moved in to occupy the Ruhr, Germany's main industrial area. Without this major source of income, the government took to printing money which resulted in hyperinflation.