Economic developments 1914-29

What was the impact of the war on germany

• To finance the war the kiaser had issued treaury bills instead of taxing the wealthy this created massive debt

• Borrowed from anyone prepared to buy war loans

• The goverment put money into circulation removing links between paper money and gold

how much did the money increace in circulation between 1913 and 1919

1913- 2000 million marks

1919 - 45000 million marks

How much did national debt increace by 1913-1919

1913 - 5000 million marks

1919 - 144000 million marks

what was average productivity during the war

4%

What was included in the treaty of versiles

• Land and colonies loss

• Reperations from russia 1918 ceaced

• coal mines of saarh passed to the french for 15 years

• 90% of merchant fleet surrended

• must suply free coal to france, belgium and italy

6.6 billion cost in Marks and goods

by what percent had the currency fallen by 1919 compared to pre-war

20%

What policies did the goerment use initally after the war economically

• did not stop borrowing or remove money from circulation

• allowed some inflation hoping it would restimulate the economy

Having low unemployment stimulated investment from the US

what was unemployment in 1921

1.8%

Downsides of Economy by 1923

• Prices dropped between 1918-19

• but then quadrpled between 1919-20

This was partially due to the coalition of zentrum whi was supported by industralists who benifited from inflation

Inflation aslo helped reduce the goverments debt and in hopes of ending reperations

What limited the payment of reperations

• Had to pay in cash and thus needed to export

• exports were low due to lack of trust and slow growth everywhere

• Everyone was in Debt to the USA which ment european trade was not stimulated

• germany faced large loans and cost of pensions and welfare

Eg. 1922 germany asked for an extention and loan of 200 million gold marks

Effects of the Rurh invasion on the economy

• paying wages increaced the countries debt

• tex revenew decreaced massively

• Germany had to import coal

• Shortages resulted in inflation

Hyper inflation 1923

• in 1922 inflation passed 50%

• By Nov 1923 the currency was seen as worthless

Workers had to be paid twice daily.

what was the goverments policy towards reperations

“fullfillment”

• In hopes that the allies would reduce thier debt

What didthe reperations include by 1921

• 5000 railway locamotives

• Entire german merchant fleet

• over 100,000 wagons, horses, cattle and agriculture machines

who was in charge of reperations at the begining

Walter Rathunu and cuno stopped paying them through passive resitance

How did the economy develop 1914-1929

• Walther ratenue was in chareg of industry

• he was inchacre of the organisation and distribution of war matirials and the prussian war office

• Centreal purchasing company set up to maintain trade with neutral countries

• Creation of large industrial companies were set up to maintain trade with neutral countries

What was production by 1919

• By 1919 it was little over 1/3 of what it had been in 1913

When did prosuction reach pre-war levals

1927

How much did industry grow by between 1913-29

4%

Unemployment never reached bellow 1.3 between 1914-29

Unemployment never reached bellow 1.3 between 1914-29

what is Ersatz

• Subsitute matiials to provide greater self sufficency

What were key developments in industry 1914-29

• Rationalisation

• Cartels 3000 by 1925

• Heavy industry output by blast furnaces x3

• chemical industry increaced

What and when was the Vereintge Stahluerke formed

1926

Linked coal, steel ect people

• Controlled 40-50% of iorn and steel

• Controlled 36% of coal

How did agriculture develop 1914-1929

• Challanged by cheaper forign imports

• Poor harvests 1917-1918

• 1919 Reich resettlement law helped redistribution however only ½ a million had be relased by 1928 and only 3% of small farmers benifited

• High tax and morgage rates

how much land belonged to the top 1% of landowners 1919

20%

when did stesseman become chancerloor

1923 for three months

what were stressemans first economic policies

• Ended passive resistence

• Schatch introduced the renhkmark vallued at 1 million old marks in 1923 nov

• fiscal mesures

• new taxes and lending rates controlled

How many banks went bankrupt in 1920

• over 6000

What was inflation by 1926 and unemploment

0% inflation

but…

• still 20% peak unemployment

When did the rentenmarck change

1924 → riechmark

what and when was the young plan

1929

• reduced the total reperations by 75% and extended the time period to 54 years

This upset right wings like hitler and hugenburg

what was the value of total loans between 1924-30

25.5 billion marks however…

• reperations in the same time was 22.8 billion marks

What was the dawes plan and when

1924

• Stresseman and the allies reperations commitie adressed concerns

• Under the banker Charlse Dawes thet proposed the amount payed would be reduced until 1929

• germany would recive an 800 million loan from the USA

To do this they must stabalise thier currency and recognise the riechbank

when was the evacuation of the ruhr

1924-25

what were the weaknesses to the economy 1914-29

• Dependednt on foriegn loans

• short term soloutions

• vaunrable to resession

• economic improvements were non universal

• germany was living beyond its means

• wages pushed up by trade unions poor compared to the rest of the world