Weimar Inflation History

In Germany at that time, economic experts simply had no idea of the quantity theory of money. Havenstein, the president of the Reichsbank, believed that the incredible inflation of the mark had nothing to do with the fact that he was printing ever more notes.

Once inflation really got going, people could see that it was useless to keep money, so they went out on insane spending sprees, buying, for example, pianos which they couldn’t play.

The word “crisis” means the moment when a problem comes to a head, but the trouble with inflation is that it is a way of postponing (and therefore ultimately worsening) that crisis.

As Lord D’Abernon, the astute British ambassador to Germany at the time, put it, “Inflation is like a drug in more ways than one. It is fatal in the end, but it gets its votaries over many difficult moments.”



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