Hyperinflation – Nurul Atiqah (15)
The history of the economic crisis in Germany before the Second World War began with the signing of the Treaty of Versailles (TOV) in 1919. The WWI winners deprived the country of a part of its territories with three-quarters of iron ore reserves. German was supposed to pay $33 billion of reparations. The Germans were more burdened by the huge sum reparations after WW1. To lessen the value, the Germans had to produce more money.
Germany could not pay the huge sum of money in 1922 and this allows France and Belgium to invade Ruhr in 1923, the German industrial heartland, so as to extract reparations forcibly in the form of raw materials and manufactures. This led to hyperinflation that effectively made banknotes became worthless bundles were given to children to play with, being cheaper than actual toys and crippled the economy.
This led Hitler to rise to power.
No comments:
Post a Comment