Economy 14-29 Flashcards
How much did circulation of money in 1913 to 1919 increase by?
1913 = 2000 million marks worth.
1919 = 45,000 million marks.
How much did the national debt increase by from 1913 to 1919?
1913 = 5000 million
1919 = 144,000 million
How much was the 1919 value of currency worth in comparisons to pre war value?
1919 currency value was 20% of its pre war value.
What prices rose, and by how much?
Basic foodstuff and consumer goods prices tripled or more during this inflationary period.
Impact of TOV?
Land and colonies lost; coal mines of Saar passed to French for their benefit for 15 years; supply free coal to france, belgium and Italy; 90% merchant fleet surrendered. Reparation bill of £6.6 billion in 1921.
Why did government borrow continue post defeat in WW1?
Dared not devalue currency due to politics, it stimulated economy, needed capital for pension demands, rebuild industry + trade.
Why would allowing inflation be wise?
It stimulated economic activity, unemployment was low in comparison to UK (1.8%>17%) = investment. 1920 coalition = zentrum industrialists = benefit short term loans, it lessened government debt burden, hoped itll convince allies reparations are too much, policy of fulfilment encouraged leaving economy alone.
By the time allies made decision of TOV total, how much did the allies and Germany predict they’d already paid?
Allies said = 2.6 billion gold marks.
Germany said = 37 billion gold marks.
How did ruhr occupation worsen economic situation?
Had to pay workers wages with no productivity, tax revenue was lost, had to import coal + pay with limited foreign currency, shortages of goods = prices up, international confidence in mark collapsed.
