1924-28 economic developments Flashcards
what was the first major economic development of this era?
1924 Dawes Plan
what was the dawes plan?
- US gifted a loan of short-term credits, totalling 800m marks
- stabilised German economy after the effects of hyperinflation
- amount of reparations paid by Germany was reduced until 1929, when it would rise to 1000 million and raised by annual increments of 2500m for 5 years
what developed after dawes plan?
- money was fuelled into the remodelling of German infrastructure,creating jobs and limiting unemployment (around 5% at time)
- creation of mediums of social enjoyment such as cinemas and theatres
- short-term satisfaction however
- placed Germany in a terrifically vulnerable position financially due to heavy reliance on american finance, invigorating political tension and angering RW traditionalists
what did pulzer say about the plan?
‘Dawes Plan loans encouraged modernisation’
next major economic developments?
role of stresemann, rentenmark, passive resistance
how did stresemann invigorate economic development?
- stresemann, in his role as chancellor, followed by foreign minster was hugely instrumental in initiating economic recovery
what did he do?
- reforemed currency by creating the rentenmark, where 1 rentenmark = 1 trillion old marks supported by a mortgage on all industrial and agricultural land
- ended the policy of passive resistance in september 1923
what developed?
- reformation of German currency was hugely significant in stabilising the economy
- government kept tight control over the currency after it was launched to prevent any inflationary spikes. august 1924 renamed the reichsmark, backed by the german gold reserve valued at 30% of reichsmarks in circulation
- stopping passive resistance reduced economic deficit and made first step towards reducing government expenditure. regenerated production in the ruhr, long-term benefits.
what did s.marks have to say about it?
stresemann ‘worked himself to death’ to better weimar republicanism
what was agricultural crisis?
-in 1926 there was a world surplus of grain
- less profit obtained leading to several bankruptcies
- 1928 farmers initiated a series of small scale riots known as ‘farmer’s revenge’ in protest against low prices
- in 1929 agricultural production was less than 75% of pre war levels