hyperinfaltion Flashcards
what did Germany rely on during the first world war?
loans to fund their involvement, 75% of war costs had been met by loans
what caused this inflation
WR solved the problem of not having enough money by printing more this caused hyperinflation
money was virtually worthless so prices shot up - wages began being payed daily
some germans gained from this like the government and big industrialist who were able to pay off huge debts in worthless marks
middle class had it the worst as they lost all their savings
in august 1923 stresmann resolved this economic crisis
the effects of hyperinflation included..
the middle class were ruined and subsequently very bitter towards the weimar republic
people with debts or mortgages were able to pay of various types of loans (taken out when money was worth much more) cheaply with the deflated currency
the lives of many Germans were disrupted. For example, people werepaid twice daily and had to collect their wages in wheelbarrows
workers having to save 6 weeks wages for a pair of shoes
how did the Stresemann solve the 1923 economic crisis?
he called off the passive resistance in the Ruhr
he called in all of the worthless marks and burned them, replacing them with a new currency called Rentenmark
he negotiated to receive american loans under the Dawes plan
he even renegotiated the reparation payments
new currency 1923
stressemann introduced a new temporary currancy the Rentenmark
it reset the value of the German currency
in 1924 the Rentenmark was changed to the Reichmark
the Reichmark was much more stable and long term
