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Economic Developments - Coggle Diagram

- - - - shipping and cement expanded under Wiking Konzern, a large cartel
    - - 1927 coal production 79% of pre war 1913
      - pig iron 68%, steel 86%
    - - large scale production of artifical fertilisers
      - formation of IG Farbenindustrie 1925
    - - Siemens virtual monoloply
      - electrical lighting and radios, accelertated in war years
- - - - treasury bills - borrowed heavily in war loans, with understanding they they would have to repay with heavy interest
      - Kaiser agaainst taxing the wealthy
      - gov put more money into circulation (ensure constant supply of money.)
    - - circulation of money increased from 2000 million Marks worth 1913, to 45,000 million in 1919
      - amount of money owned by government (national debt) grew from 5000 million to 144,000 million
      - value of currency fell, in 1919 worth less than 20% of pre-war value
      - price of foodstuffs and essentials tripled = black marke
  - - - no longer depend on repaying via annexations
      - Tov
        
        land and coloies lost
        
        coal mines in Saar to French
        
        had to supply free coal to France, Belgium, Italy
        
        90% of merchant fleet surrendered to allies
        
        £6.6 billion reparations
  - - - prevented devaluing of currency
      - stimulated economic activity
      - unemployent rates low (1.8% unemployed in Germany, compared to 17% in Britain.
      - encouraged investment from US
        
        ecnomy grew rapidly between 1920-22
    - - prices doubled between 1918-19, quadrupled between 1919-20 (14 times higher than 1913.)
  - - - benefitted from inflation by taking short term loans from Germany's Central Bank to expand businesses (could repay with inflated currency)
      - could create seemingly generous wage agreements that could be payed with worthless money
      - inflation had to effect of lessening gov's burden of debt
  - - - Germany needed to export goods to acquire the currency needed. However, Germany's western European trading partners wanted to build up their own economies & not buy German goods.
      - Western Europe in debt to US. Did not stimulate Euroeon economies.
      - Germany already facing payments on interest on loans raced during war
    - - Germany first reparations payment (£50 million) May 1921
      - Jan 1923 fallen behind = Ruhr invasion
    - - paying the wages or providing goods for striking workers was further drain on economy
      - tax revenue was lost - both from businesses that ceased and unemployed workers
      - Germany had to import coal from the limited foreign currency reserves within Germany
      - shortages of goods pushed up prices further
      - international confidence in Mark collapsed.
    - - by May 1921 - Allies estimated they had recieved 2.6 billion gold marks worth of goods, (entire German merchant fleet, 5000 railway locamotives, etc.)
      - Germans claimed to have already payed 37 billion marks
- - - - made provision for larger estates to be distibuted among smaller farmers
      - 1928 - only half a million hectres released due to right wing opposition
      - only 3% of small scale farmers benefitted