R' Noach, it is wonderful to hear from you!

There might be a number of possible reasons why the Chachamim would want to change the value of the currency.

1) It might be that there had recently been some kind of financial crisis. Perhaps there was a bout of inflation, and therefore the locality may decide that what was previously called 100 shekels is now called 90 shekels. This encourages people to spend money, because if a chair costs 500 shekels the public feels this is too much to pay, but if they are only paying 450 shekels they do not consider that they are being overcharged.

2) In this country (Israel), many years ago, 1000 shekels became 1 shekel through a devaluation. This was because there had been roaring inflation, reaching around 300% a year. 1 shekel on the old system was rapidly becoming worthless, but 1 new shekel suddenly became worth something, and this had a stabilizing effect on the economy.

3) Roaring inflation is a phenomenon which is more common nowadays than in the time of Chazal. The Gemara (Sanhedrin 97a) tells us that "the son of David (the Mashi'ach) will not come until the small Perutah coin will disappear from the pocket." This is because the lower denominations will be useless since prices have gone up so high.

4) This is described by the S'ma (Sefer Me'iras Einayim, 16th century commentary on Shulchan Aruch) who writes (Choshen Mishpat 88:2) that in the time of Chazal one could buy a lot of fruit with the Perutah coin, while in the time of the S'ma in the 16th-17th century one could buy only a very small amount. I can add that in our times, year 5777, I believe a Perutah is worth 7 Agurot (or 2 U.S. cents). You cannot buy anything for 7 Agorot.

However, even though inflation was lot lighter in the time of Chazal, it still did exist to a certain extent, so this may have been a motive for changing the value of the coin.

5) I believe that a major cause of inflation throughout the centuries was the act of kings changing the value of the coins in order to enable themselves to raise taxes from the people to finance their wars.

Kol Tuv,

Dovid Bloom

The roaring inflation that used to exist in Eretz Yisrael had some interesting Halachic ramifications. In 1980, Rav Moshe Feinstein zt'l wrote a Teshuvah about issuing loans amidst high inflation (Igros Moshe, YD 3:37). At that time, the Shekel was going down sharply, and the dollar was strong. There is a Halachah that one may not, for example, lend out a kilo of apples in order to receive a kilo in return because the price of apples may increase in the interim, which would mean that the creditor is receiving in return a higher value than he lent out, which constitutes receiving interest or usury. Therefore, it is problematic to lend out a foreign currency; since it is not the local currency, it follows that lending the foreign currency is equivalent to lending out a commodity (like apples). However, since the dollar was so strong at that time in Eretz Yisrael, Rav Moshe said that loans should only be made in dollars, because at that time it was tantamount to being an official currency in Eretz Yisrael.

Kol Tuv,

Dovid Bloom

I found an explanation given by Rav Chaim Greineman zt'l, in Chidushim u'Biurim Bechoros 50a (DH Sham u'Minayin) of why it might be wanted to change the currency.

1) Rav Greineman comments on the Gemara there, which states "And how do we know that if they want to add on to the coin, that they may do so?". The Gemara cites a verse to show that they may add on. R. Greineman asserts that the reason for adding on is because it may happen at some point in time, that the Sages observe that the value of money has gone down, or alternatively that people have become richer; and as a result the real value of money as referred to in the 27th chapter of the book of Vayikra, has gone down. There, the Torah tells us about a person who makes a vow that he will donate the value of himself or of somebody else, to the Beit Hamikdash. If, for instance, the person whose value was vowed was a man between 20 and 60 years old, then 50 shekels must be donated to the Beit Hamikldash. However we are concerned that the sum of money that must be donated, should remain a fairly stable value which does not fluctuate too far from the real value of 50 shekels at the time the Torah was given. Therefore the Chachamim may want to update the currency in order to keep the real value of the din of the Torah.

2) So we can say that the thinking behind changing currency is, to use a phrase, because we want the Torah to remain relevant to contemporary life. What I mean to say is that when the Torah says that it is possible to make a vow to donate to the Beit Hamikdash the value of a person of a specific age, this presumably means that the Torah states that such a person has a real value. If that was the value that the Torah wanted us to give at the time that Moshe received the Torah on Har Sinai, then it makes sense that since the 9th of the 13 Principles of Faith is that "This Torah will not change" this means that we try and keep the circumstances as similar as possible to those that prevailed at the time of Matan Torah. So if the currency goes down, or alternatively people became more affluent, it is logical that the Chachamim will want to change the coins to keep the real value consistent with the time of Har Sinai.

3) The above appears to be consistent with what Chazon Ish Choshen Mishpat 16:14 writes that one requires the agreement of the Sanhedrin or the Sages of the genaration, in order to add on to the coins. Once one changes the currency this certainly has a profound effect on mundane business, but the original motivation is to regulate the value of coins in connection with the Mitzvot of the Torah.

KOL TUV

Dovid Bloom