The effects of hyper-inflation and the French occupation of the Ruhr L:O: To examine what effect these events had on German society and individuals

What caused hyper-inflation? Reparations (compensation money paid by the German government to the French) meant that the German government was short of money What effect did it have on the German economy? What could the German government do?

Government printed so much money that it made it less valuable

What % increase is that (rate of inflation) between July – November? Prices went up very quickly in Germany in 1923 – the price of bread in Berlin 1923 July 1923 3,465 marks August 1923 69,000 marks September 1923 1,512,000 October 1,743,000,000 marks November 1923 201,000,000,000 What % increase is that (rate of inflation) between July – November?

Why were they printing more money? French invasion of the Ruhr Pay reparations Why were they printing more money? Germans went on General strike. The Weimar Republic said they would still pay them if they went on strike. Therefore, had to print more money.

The Ruhr Crisis1923 The Ruhr Why did France invade the Ruhr in 1923? What did the German workers do as a result? Who would be most damaged, France or Germany?

The Ruhr Crisis – why? The German government had been unable to make its first reparation payment in 1922 (Treaty of Versailles). The consequence of this was the French marched into the Ruhr hoping to get payment in kind.

Germany could not fight back militarily. How did Germany react? Germany could not fight back militarily. So the workers chose passive resistance, going on strike and refusing to work for the French.

What were the effects of the invasion? RESULT: HYPERINFLATION!!! It united the German people against the French invaders. The Weimar Republic’s popularity increased for a short time. BUT it had disastrous consequences for the German economy. The government printed more money to pay the strikers which increased inflation. The strike meant fewer goods were made and this made inflation worse.

What is hyperinflation? When a government prints too much paper money it loses its value quickly. Hyperinflation is when prices rise very high very quickly. Money soon became worthless. LOOK AT THESE IMAGES – WHAT ARE THEY DOING WITH THE BANK NOTES?

What caused hyperinflation? French occupation of the Ruhr Weimar Republic: Shortages and Reparations: Print more money WW1 German gov print more money to pay for war Strikers spend money quickly Prices rise Strikers need paying Print more money Passive resistance: Worker strike Nothing being produced. As prices rise more money is printed Prices rise and so on… Who do you think gets the blame for the economic disaster?

RESULT OF HYPERINFLATION: Prices rose dramatically E.g. in 1921 a loaf of bread cost 4 marks (old German money) by 1923 it cost 201 000 000 000 marks!

Women waiting in line in Berlin, in hopes of buying sub-standard meat, 1923. By 1923 money was useless It had lost its value.

The effect of hyperinflation Remember not everyone was affected there were winners and losers. LOSERS WINNERS People with savings in the bank. Some people had saved all their lives only to find their savings would only buy them a loaf of bread. Old people on fixed pensions found they could not afford what they needed. Many small businesses collapsed because normal trade became impossible. People who had borrowed money now found it easy to pay off their debts. If they had borrowed 10 000 marks they could now pay it off with one bank note. Farmers benefitted from price rises. The very wealthy who had land were largely protected from the worse effects.

The occupation of the Ruhr by the French Why did the French invade the Ruhr? Why didn’t the German government fight back? How did the workers react to this? How would the average German react to this? Who would they blame?

How would hyperinflation affect the following people? Fill out how the table would affect different people.

German character P.18-P.20. Positive/negative impact Which group of people were effected the most (1-worst effected). Explain A businessman A middle class person with considerable savings in the bank. A worker Farmer Pensioner The rich Challenge Task: ‘The Hyperinflation of 1923 was a disaster for all Germans.’ Point: Evidence: Explanation:

How would each of these people react? Who might they blame?

Write a speech against the government You will want to include complaints about: The Treaty of Versailles The occupation of the Ruhr The effects of hyperinflation

By the end of the lesson you will Have notes and understand why the following key events happened Hyper-inflation – impact on different groups French occupation of the Ruhr Why the French invaded Why Hitler planned the Munich Putsch and why it failed