Economy FOCUS

• Treasury bills were used so that the Kaiserreich did not have to tax the elites.
• Due to the war, the price of food and consumer goods tripled.
• The coalmines of Saar were passed to the French
• By 1921, there was only 1.8% unemployment in Germany and 17% in Britain.
• Prices doubled 1918-19 and quadrupled 1919-20
• The goods worth of reparations included: the entire German merchant fleet, 5000 railway locomotives, and over 100000 of each railway wagons, horses, cattle and agricultural machines.
• Impact of Ruhr invasion: payment to workers were a drain on the economy, tax revenue was lost from newly unemployed, shortage of goods pushed prices further up.
• Food shortages were really common as farmers were not prepared to sell their goods for worthless money.
• The new currency was backed by land and limited resources.
• 200 war material companies were set up to buy raw materials for the production of armaments and equipment. The purchasing company maintained trade with neutral countries.
• In 1916, the German economy suffered tremendously from the British blockade and the demand for conscription. By 1919, industrial production was only a little over one third of what it had been in 1913.
• Towards the latter part of the golden years, there were already a fall in production when capital investment fell back. Unemployment reached 3 million by 1929.
• To try and recapture lost markets and increase profits, they got rid of surplus labour, introduced new technology, new management and industrial techniques.
• Output of blast furnaces tripled.
• Advances were made in the chemical industry due to wartime research. The IG Farbenindustrie formed from a number of major chemical companies that worked closely together during the war years.
• Electrical industry made advancements, Siemens had a virtual monopoly.
• Smaller industries performed less well as they had less access to capital and restricted markets.
• In 1919, more than 20% of cultivated land belonged to less than 1% of landowners.
• 1919 Reich Resettlement Law made provisions for larger estates to be redistributed among larger farmers, by 1928, only half a million hectares had to be released.