The Challenges of 1923



  • When price of goods increases it is called inflation 
  • When the price of goods increases dramatically it is called hyperinflation 
  • In 1923, Germany had a terrible economic crisis 
  • Problem; Hyperinflation made german currency worthless
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Why there was Hyperinflation


  • Gov. printed more money to pay for WW1, but didn't have more gold- it was bankrupt 


  • Weimar gov. printed more money for post-war shortages 
  • Asked for longer to pay first reparations installment 

Jan 1923

  • French troops invaded the Ruhr to take reparations in goods & raw materials 
  • German workers on strike 
  • 80% of German coal, iron & steel reserves and their factories in the Ruhr 
  • This occupation was disastrous for German economy 
  • Weimar gov. printed more money to pay strikers & make up the loss of the production of goods & raw materials      German mark became useless as a result by Nov 1923 
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Effects of Hyperinflation- Negative

  • Some People couldn't afford essentials 
  • Wages rose but prices rose quicker 
  • Some businesses went bankrupt - taken over by the succesful ones 
  • People with fixed incomes (pensioners) suffered most
  • Savings became worthless - middle classes affected most 
  • This was blamed on Weimar Gov- even more unpopular
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Effects of Hyperinflation-Positive

  • Because they were paid more for food- farmers benefitted  
  • Some people/businesses could pay off loans and mortgages 
  • Fixed rents for rooms/shops became very cheap 
  • Foreigners could buy more for their money 
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