Why did official money lose its meaning in Germany during the 1920s?

Why did money become worthless in Germany?

Germany was already suffering from high levels of inflation due to the effects of the war and the increasing government debt. … In order to pay the striking workers the government simply printed more money. This flood of money led to hyperinflation as the more money was printed, the more prices rose.

How bad was Germany’s economy after ww1?

Germany emerged from World War I with huge debts incurred to finance a costly war for almost five years. The treasury was empty, the currency was losing value, and Germany needed to pay its war debts and the huge reparations bill imposed on it by the Treaty of Versailles, which officially ended the war.

When did German money became worthless?

In 1923, when the battered and heavily indebted country was struggling to recover from the disaster of the First World War, cash became very nearly worthless. Germany was hit by one of the worst cases of hyperinflation in history with, at one point, 4.2 trillion German marks being worth just one American dollar.

Why was Germany so weak after ww1?

Thanks to the Treaty of Versailles, Germany’s ability to produce revenue-generating coal and iron ore decreased. As war debts and reparations drained its coffers, the German government was unable to pay its debts. Some of the former World War I Allies didn’t buy Germany’s claim that it couldn’t afford to pay.

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What were the economic impact of first world war on Germany?

By 1918, Germany was no longer a strong confident country, but one on the brink of ruin. The war had destroyed Germany’s economy. The country spent around one third of its income on war pensions to all those widows and families who had lost someone during the conflict.

What was the impact on Germany after ww1?

Germany lost 13% of its land and 12% of its population to the Allies. This land made up 48% of Germany’s iron production and a large proportion of its coal productions limiting its economic power. The German Army was limited to 100,000 soldiers, and the navy was limited to 15,000 sailors.