Reparations Invasion of the Ruhr HYPERINFLATION!.

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Reparations Invasion of the Ruhr HYPERINFLATION!

Reparations Due to the War Guilt Clause and the Treaty of Versailles in November 1919, Germany was forced to pay up a huge sum of reparations. They were ordered to pay annual instalments of this amount from the year 1921 onwards You must realise that this would affect the economy of Germany for many generations to come

Invasion of the Ruhr The French and Belgians sent troops into the Ruhr which was Germany’s main centre in the production of coal, steel and iron. (Essential materials for the survival of the economy)

Passive Resistance….Did it help? The German government then responded by ordering passive resistance so that the invading troops could not have what they wanted. However, even though at first it looked as if they were winning, the markets had stalled and they still needed to pay the workers

The government’s solution and answer to this was to print more…

HYPERINFLATION Sadly this only caused hyperinflation to take place! - It meant that the value of the currency drastically dropped People’s life savings became practically worthless and were not enough to buy a week’s groceries A decrease in living standards and starvation were widespread

Take a few moments to recap Germany could not meet their second reparations payment France and Belgium consequently invaded the Ruhr which was rich in essential raw materials The angered German government ordered passive resistance Even though the invading troops didn’t get what they wanted, the government had to pay their workers and so started to print more and more money. This inevitably led to…. HYPERINFLATION

The next problem will be the Munich Beer Hall Putsch