The Wall Street Crash and Germany (1929)

Question 1

Stock market failure

Answer 1

The Wall Street Crash occurred in October 1929 and had an immediate ripple effect on Germany, who were heavily reliant on the Dawes Plan (1924) and Young Plan (1929). The USA stopped importing German goods and the loans to help with reparation payments were recalled by the US Treasury.

Question 2

Memory of hyperinflation

Answer 2

In Germany the memory of hyperinflation (1923) led many to pull their savings from the bank and converting them into gold or other secure forms of wealth.

Question 3

What happened as a result?

Answer 3

1) Four major national banks collapsed
2) Agriculture in Germany was already suffering in 1928 due to a bad harvest year and so farms collapsed and prices tumbled
3) By 1932 unemployment had risen from 150,000 to 6 million

Question 4

What effect did this have on the German political climate?

Answer 4

Vast dissatisfaction with life drove German people away from the political middle ground and towards the right-wing extremes, primarily the KPD and NSDAP

Question 5

What did Bruning do about his?

Answer 5

The Weimar government under Bruning with Hindenburg’s approval carried out many unpopular actions to try and balance the budget to keep the nation afloat:

1) Thousands of civil servants were fired
2) Social care benefits to ill, unemployed, and retired were slashed
3) Taxes were raised for all demographics