Winners and Losers of hyperinflation Flashcards
What did Stresemann state in 1927?
‘The worst consequence of the inflation was the damage done to the German middle class’
What was generally assumed in the 1930s?
The middle class voted for the Nazis due to their economic suffering in 1923.
Who were the winners of the hyperinflation crisis?
The sections of the community who were able to pay off debts, mortgages and loans with worthless money.
How did black markeeters benefit?
They brought up food stocks and sold them at visibly inflated prices. They exploited the situation by making increased gains.
How did businessmen benefit?
They borrowed cheaply and investing new industrial enterprises. They helped enterprising businesses who took out new loans and repaid them once the currency fell in value.
How much of German industry did Hugo Stinnes control in 1923?
20%
How did farmers benefit?
Food was in demand and money was less important in rural areas.
Who lost out?
Those who depended on their savings lost out. Any German who had money invested in bank accounts with interest rates found the real value had decreased.
How did the elderly lose out?
They had depended on fixed pensions and savings.
How did industrial workers lose out?
1) In 1923, the trade unions were unable to negotiate wage settlements for their members.
2) Wages could not keep pace with the rate of inflation and a very real decline took place.
3) fewer savings and lost proportionally less than those living on saved income.
What percentage of people were unemployed in 1923?
4.1%.
How did people who had war bonds lose out?
Millions who had bought and invested in war bonds now could get their money back but the bonds were worth nothing. the fixed interest led to a decrease in value of the interest payments.
How did unskilled workers lose out?
The wage had increased but it didn’t keep up with rising prices and so standards of living had decreased.
By 1923 what had happened?
There was an increase in unemployments and short time working. Only 29.3% of the workforce was fully employed.
How did the Mittelstand lose out?
The cost had increased and the prices they charged could not keep pace with inflation.
