Vermilion Voice
March 29, 2024, 08:22:41 am
Welcome, Guest. Please login or register.
Did you miss your activation email?

Login with username, password and session length
News: Welcome to the Vermilion Voice
 
  Home Help Search Arcade Gallery Links Staff List Login Register  

Germany 1914 - 1924

Pages: [1]
  Print  
Author Topic: Germany 1914 - 1924  (Read 72 times)
0 Members and 1 Guest are viewing this topic.
buzorro
Hero Member
*****
Gender: Male
Posts: 836


View Profile
Badges: (View All)
Level 4 Windows User Combination
« on: November 07, 2010, 06:08:57 pm »

Before World War I Germany was a prosperous country, with a gold-backed currency, expanding industry, and world leadership in optics, chemicals, and machinery. The German Mark, the British shilling, the French franc, and the Italian lira all had about equal value, and all were exchanged four or five to the dollar. That was in 1914. In 1923, at the most fevered moment of the German hyperinflation, the exchange rate between the dollar and the Mark was one trillion Marks to one dollar, and a wheelbarrow full of money would not even buy a newspaper. Most Germans were taken by surprise by the financial tornado...

...the prices that had doubled from 1914 to 1919 doubled again during just five months in 1922.

...Why did the German government not act to halt the inflation?...More than inflation, the Germans feared unemployment...

So the printing presses ran, and once they began to run, they were hard to stop. The price increases began to be dizzying. Menus in cafes could not be revised quickly enough. A student at Freiburg University ordered a cup of coffee at a cafe. The price on the menu was 5,000 Marks. He had two cups. When the bill came, it was for 14,000 Marks. "If you want to save money," he was told, "and you want two cups of coffee, you should order them both at the same time."

...Other reports noted that not all the young people had a bad time. Their parents had taught them to work and save, and that was clearly wrong, so they could spend money, enjoy themselves, and flout the old.

...The publisher Leopold Ullstein wrote: "People just didn't understand what was happening. All the economic theory they had been taught didn't provide for the phenomenon. There was a feeling of utter dependence on anonymous powers -- almost as a primitive people believed in magic -- that somebody must be in the know, and that this small group of 'somebodies' must be a conspiracy."

When the 1,000-billion Mark note came out, few bothered to collect the change when they spent it. By November 1923, with one dollar equal to one trillion Marks, the breakdown was complete. The currency had lost meaning.

What happened immediately afterward is as fascinating as the Great Inflation itself...

Pearl Buck, the American writer who became famous for her novels of China, was in Germany in 1923. She wrote later: "The cities were still there, the houses not yet bombed and in ruins, but the victims were millions of people. They had lost their fortunes, their savings; they were dazed and inflation-shocked and did not understand how it had happened to them and who the foe was who had defeated them. Yet they had lost their self-assurance, their feeling that they themselves could be the masters of their own lives if only they worked hard enough; and lost, too, were the old values of morals, of ethics, of decency."

The fledgling Nazi party, whose attempted coup had failed in 1923, won 32 seats legally in the next election. The right-wing Nationalist party won 106 seats, having promised 100 percent compensation to the victims of inflation and vengeance on the conspirators who had brought it.

http://www.pbs.org/wgbh/commandingheights/shared/minitext/ess_germanhyperinflation.html

**************************

Federal Reserve Chairman Ben S. Bernanke said the central bank must focus on the U.S. rather than overseas economies when trying to spur the recovery by purchasing an additional $600 billion in Treasuries.  (Foriegn countries are becoming reluctant to buy US Treasury bonds, which is what the US government sells in order to spend)

http://www.bloomberg.com/news/2010-11-06/bernanke-defends-fed-securities-purchases-says-growth-will-support-dollar.html

Germany attacks US economic policy

http://www.ft.com/cms/s/0/c0dca084-ea6c-11df-b28d-00144feab49a.html#axzz14e2TNRMF
Report Spam   Logged

Don't blame me...I voted for Ron Paul

Share on Facebook Share on Twitter



Pages: [1]
  Print  
 
Jump to:  

Bookmark this site! | Upgrade This Forum
SMF For Free - Create your own Forum

Powered by SMF | SMF © 2016, Simple Machines
Privacy Policy