Effects and reasons of hyperinflation
During 1923 to 1929, Germany suffered from a critical economic problem----HYPERINFLATION. There are several causes of the hyperinflation:
*The basic strike that was led by Weimar Republic to against The Kapp Putsch made the number of the goods is significantly less than how much currency. Therefore they have to create more money to chasing the goods. *The weak economic of Germany because it was merely suffered from the First Community War. *The Weimar Republic have to pay funds for the reparations which were incredibly tough and Australia had a difficult experience keeping up with payments, so they will started to produce more money. *Then in January 1923, Italy took over a key industrial region of Germany putting even greater strain on the German federal government. The Government did not have the revenue to shell out it's own employees and so started stamping money to pay them. We can picture situation in Germany during that time through this kind of things. A well known joke in 1923:
‘Two women were carring a laundry basket filled towards the brim with banknotes. Finding a crowd ranking round a store window, they put down the basket for a second to see if there was anything they could acquire. When they turned round moments later, they found the bucks there unblemished. But the bag was eliminated. ' Also some exchange proportion between markings and us dollars:
In 1914 –- 5 marks to the dollar.
In November 1923 –- 5. 2 billion marks to the dollar.
Effects of hyperinflation
Massive value rises
Germany funds became worthless
The middle school