Central bank goes brrrrrrrrrrtttttt
To be fair they were all out of options, were they not?
I’m no economist or historian, but the case can be made that the poor decisions of the Weimar leadership exacerbated the problem. Some inflation was inevitable, but the post-war government did a lot of damage.
- They stubbornly refused new taxes or loans during the war, instead relying on victory
- They continued to refuse new taxes or loans in the early days after the war
- They delayed and refused economic reform in the early years of reparations that were obviously needed (not just in hindsight)
- They paid their workers to resist the occupation of the Rein by French forces instead of cooperating. To do this they printed a lot of money and effectively put some of their most profitable industries on strike
- They created a new currency pinned to the value of gold, while leaving the old money in circulation (no buy-backs), and never allowed for credit or borrowing against this new currency by private individuals or the government
Basically a failure to act early on caused a snowball effect, and late stage choices worsened the outcome. And all this while the damage to their industry from the war was minor. Neighboring France was decimated and recovered nicely by taking loans, taxes, credit, and investing in their industry and people.
According to some evidence, this was in part purposeful by the Wiemar Republic government to devalue their existing domestic debts and keep their wealthy oligarchs happy.
Again, not a historian or economist, but it’s an interesting part of history to dive into.
cool video on this era, follow up from post hyper inflation period
How the Nazis created an economic miracle
economic miracle
Also known as unsustainable debt.
they did wayyy more than that though, the economic shuffling they did was amazing
it always confused the hell out of me how a bankrupt nation could build an army that could take on the world
One neat trick that economists don’t want you to know about! (It’s not paying people)
Mefo bills were issued to mature in six months, but with a provision for indefinite 90-day extensions at the government’s behest. To further entice investors, Mefo bills carried an annual interest rate of 4%, higher than that of other trade bills at the time.
To make sure that the bills were never exchanged for Reichsmarks, which would lead to inflation, the 90-day maturation period was continually extended until the maturation was changed to a period of five years by 1939.[6] The exact total volume of Mefo bills issued was kept secret. However, as previously stated, it is assumed billions were printed.
Plus the whole “Let’s steal everything from our Jewish population”, which combined with the not paying people thing, sounds to me like the whole Nazi Economic Miracle is a bit of a “the secret ingredient is crime” economic approach.
I mean… they even stole their fucking teeth.
tbf, it’s also one part “Not doing the fuckwit austerity thing”
