Postwar Problems-German Inflation

Objective: Assess the global impact post-WWI economic turmoil—Worldwide Depression

Loss of life was not the only cost of World War I.The loss property and the tremendous costs of

fighting the war led to financial collapse.Most the nations of Europe were economically

devastated by the conflict. The nation that suffered the most was Germany.

Smashed grocery store windows in hungry Berlin - 1919

Besides loss of life, what were other costs associated with WWI?

What did these costs lead to?Which nation suffered the most?

During the war, Germany had simply printed more money to finance its war efforts.

Terms of the Treaty of Versailles added to the debt it had incurred by this measure.

The reparations Germany owed the Allies increased its economic woes.

By the early 1920s, its economy had collapsed.

To pay its debts, the German government printed even more paper money.

How did Germany deal with paying for the war effort?

What document contributed to Germany’s debt?

What part of this document specifically increased Germany’s economic problems?

How did Germany deal with paying its debts?

This caused inflation (a steady rise in prices).

Money became worthless.Wheelbarrows full of paper

money were necessary to purchase basic necessities.

American loans and investments helped somewhat to improve the German situation.

German children

use stacks of

money as

building blocks

during the 1923

inflation.

Postwar Problems

German inflation

in the 1920s:

woman burning

worthless

banknotes (paper

money) for fuel

By printing more money, this caused what in Germany?

What is inflation?What happened to money?How much money did it cost to purchase basic necessities?

What are two examples of how much money is worth (valued) in Germany post-WWI?