Question

What were the factors that led to hiper infection to Germany?

Answer 1

Political radicalisation was only heightened by the economic crisis of 1923. Germany had fought the war largely on loans and had to pay war reparations in gold. This depleted gold reserves at a time resources were scarce. In 1923 Germany refused to pay, and the French occupied its leading industrial area, Ruhr, to claim their coal. Germany retaliated with passive resistance and printed paper currency recklessly. With too much printed money in circulation, the value of the German mark fell. In April the US dollar was equal to 24,000 marks, in July 353,000 marks, in August 4,621,000 marks and at 98,860,000 marks by December, the figure had run into trillions. As the value of the mark collapsed, prices of goods soared. The image of Germans carrying cartloads of currency notes to buy a loaf of bread was widely publicised evoking worldwide sympathy. This crisis came to be known as hyperinflation, a situation when prices rise phenomenally high.
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