Hyperinflation Lesson starter: Copy the paragraph below. In 1923 Germany fell behind with their reparations payments. This caused France and Belgium to enter the Ruhr region of Germany and take goods like steel and coal. There were many shortages. Prices went up. The Weimar government took the decision to print more banknotes as a solution.

https://blogs.glowscotland.org.uk/gc/stanationalhistory/

Today we will… Understand why hyperinflation occurred in Germany Identify the problems it created Create the solution to hyperinflation

As we know, the Ruhr Crisis left shortages in Germany as people refused to work This made prices rise (inflation) The Weimar Government printed off more money to try and help this This was disastrous for Germany Ebert

1 US DOLLAR ($) Deutschemarks (DM) This table shows how much a US dollar could be purchased for in Germany 1 US DOLLAR ($) Deutschemarks (DM) 1922 400 Feb 1923 7000 August 1923 1,000,000 November 1923 130,000,000,000

How would Hyper-inflation affect you? British money suffers from inflation like all currencies but so small we hardly notice it. But imagine if British money became worthless almost overnight, what could you do? Imagine a typical day in your life and how having no money to spend would effect you.

Observation skills You will see some pictures which show the effects of hyperinflation in Germany Write down what you see in each picture

Effects of Hyperinflation Savings and pensions became worthless – middle class e.g. shop owners, factory owners) affected most Those with a set salary (like pensioners) earned practically nothing Prices went up a few times a day so workers had to be paid twice daily and spent their wages immediately People weren’t strong enough to carry enough money about to buy goods Poverty, starvation and unemployment increased People started ‘bartering’ = swapping/trading goods rather than cash

Who was to blame? Imagine you were a war veteran or war widow in 1923. Your set pension is now worthless and you are left with nothing How would you feel? Who would you hold responsible? Vote for me and I will return Germany to a booming economy. I will protect your wages and savings from the thieves of Weimar.

A solution to Hyperinflation? 1. 2. 3.

How did Hyperinflation end? A new chancellor Gustav Stresseman was appointed America gave Germany loans through the Dawes Plan to rebuild their economy The French left the Ruhr in 1924 A new currency, the Rentenmark, was introduced

Today we will… Understand why hyperinflation occurred in Germany Identify the problems it created Understand the solution to hyperinflation