Inflation - price of things going up due to shortage of money.
Government income was 1/4 of what was required, so they printed more money.
They had 300 paper mills and 2000 printing shops just to print more money.
Currency was now worthless.
In 1918, £1 cost 20 German marks. In 1923, £1 cost 20 billion marks.
Some even used money as fuel, because it was cheaper.
The more prices rose, the more money was printed, resulting in prices going up again.
In 1918, one loaf of bread cost 1 mark. In 1922, it cost 200 marks. In 1923, it cost 10 billion marks.
Germans had to carry a wheelbarrow of paper money just to buy a loaf of bread.
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Consequences
Foreign supplies refused to accept marks for goods, knowing it was worthless, so imports dried up and there were shortages of food and other goods.
People began bartering - trading items instead of money.
Savings, pensions and insurance policies became worthless, which mainly affected the middle class.
There was a lot less confidence in the government - people turned to extremist parties and there were political uprisings.
There were some benifits for some- one man borrowed money for a herd of cattle, then paid back his loan by selling one cow, making huge profit.
Wages were safe; they were re-negotiated each day.
Uprisings: -A nationalist grous called the Black Reichswehr rebelled in Berlin.
-Comunists took over the gpovernment of Saxony and Thuring, as well as the Rhineland, declaring it independent.
-The Nazis carried out the Munich Putsch.
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