Early Crisis Years (1919-1923)

Question 1

What is hyperinflation?

Answer 1

Where prices spiral out of control because the government increases the amount of money being printed, this lead to money being worthless

Question 2

How did WW1 contribute to hyperinflation crisis?

Answer 2

• Germany was not prepared for such a long war and borrowed money to pay for the increasing costs
• the reparations demanded Germany to be paid in gold marks which meant the German currency declined massively

Question 3

How did Weimar constitution contribute to hyperinflation crisis of 1923?

Answer 3

The constitution made social security a constitutional right - the government had to support the unemployed.

Cost of social reforms and welfare increased the national debt and worsened inflation of the currency

Question 4

What event triggered the hyperinflation crisis of 1923?

Answer 4

French occupation of the Ruhr in revenge for Germany’s failure to pay their reparations

This resulted in the government ordering German workers to adopt passive resistance.

Weimar government had to rely on expensive imports of essential raw materials printing more bank notes lead to hyperinflation

Question 5

Who suffered during the hyperinflation?

Answer 5

• anyone with savings saw them become worthless
• people on fixed incomes
• pensioners wages became worthless

Question 6

Who benefited during the hyperinflation?

Answer 6

• anyone with debts, mortgages or loans were able to pay these of easily with inflated money
• groups of businessmen and homeowners took advantage and bought businesses, houses and factories at fraction of the cost