( C1 ) Hyperinflation Flashcards
between 1919-23 how was the income of the German Government
between 1919-23 the income of the German economy was a third of what was needed
how many mills and printing shops were there
by 1923 the government had 300 paper mills and 200 printing shops
what did most countries link the value of their banknotes to
gold
if the government had 10 million marks worth of gold in it banks what should that mean
it should mean that 10 million marks of banknotes should be in circulation
what does it mean if a country has more notes in circulation
the value of the notes drop and prices increase
for example, if there are 20 million marks in circulation what does it mean
it means that each note is worth half as much
why did Germany initially start printing more money
to fund the first world war
what happened after Germany lost the war
it printed even more money so that it could pay the reparations demanded by the ToV. After the invasion of the Ruhr it was forced to print even more money to pay the workers
what was an effect of hyperinflation which the Germans cared mostly about
the effect which they cared mostly about was the rapid rise in prices.
prices rose so rapidly that what happened
prices rose so rapidly that customers in restaurants had enough Money to pay for their meals when they sat down but didn’t have enough when they got up
what did hyperinflation do to many Germans financially
it threw many germans into poverty
who was effected most badly and why by hyperinflation
those who received the same amount of money each week as what they earned was worth less and less and pensioners
what happened overnight to the people of germany
the value of peoples savings and insurance policies were almost wiped out overnight. many people who were financially secured suddenly found themselves struggling
what was the effect for people in work
the effect for people in work wasn’t bad as their wages rose as wel. however the increase in wage were always slower than the price rises
who benefited from the hyperinflation crisis
1) people with loans and mortgages could pay them off more quickly. and business owners
2) people who owned land as the value of it rose in line with inflation
3) farmers as the price they could sell their food at higher prices
