Interbellum lesson 1

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Interwar periode lesson 1 (6.1)

CRITERIA

Explain in what way people were angry about the Treaty of Versailles.

Explain how hyperinflation arose in the Weimar Republic.

Explain how the Dawesplan improved the economical situation in Germany.

Explain how the stock exchange in the US collapsed.

Explain what consequences the economical crisis had for Germany.

Between the Wars

Germany

How do you think Germany was doing after WWI?

Chaos in Germany

• emperor fled
• reparations 
• Crisis 

Weimar Republic (1919-1933)

• constitution for the new German state
•  National Assembly
• Berlin to dangerous 
• Weimar

Weimar Republic

• Weimar is a place in Germany (Berlin was too dangerous)
• Couldn't end the unrest
•  hated the Treaty of Versailles

Why did the Germans hate the treaty Of Versailles?

Weimar Republic

• Versailles was humiliating
• Felt Betrayed 
• Some people thought Germany could have won the war

?

Stab-in-the-back-myth

The myth goes that the new government and the communists betrayed Germany by asking for a truce. This was believed by Nationalists and former soldiers.

1923

1923: Germany did not pay their debts--> Belgium and France take over parts of the country

As act of protest: German government supports people to go on strike

Strikers had to be paid--> government prints extra money--> money loses value--> inflation --> hyperinflation

Hyperinflation

Inflation means that money becomes worth much less. So you can buy less with the same money.

Or: you need a lot more money to buy the same thing

When banks print money it is called hyperinflation

Hyperinflation

Price of 1 kilo of bread

December 1921: 4 marks 

December 1922: 163 marks 

January 1923: 250 marks 

April 1923: 474 marks 

August 1923: 69,000 Marks 

November 1923: 201,000,000,000 Marks

1 mark = 0.51 euros

Germany

1924-1929

Economically, the country is doing better: 

Americans support German economy with Dawes plan

People have faith in democracy........

1924-1926

Gustav Stresemann--> convinces France to leave the Rhineland

US--> Dawes Plan = support in the form of a loan 

1925: Von Hindenburg (former general) chosen as president--> pleases veterans

The people calm down and the Republic becomes more stable

Dawes plan

United States lends money to Germany. 

Germany can thus rebuild its economy and start paying the reparation payments (Versailles).

The Stock Market crash (US)

US

- 1920s economy in EU recovers and farmers start producing again themselves. 

- US farmers can no longer sell their stuff and pay their loans. 

- Farmers become poor, unemployed and the banks they borrowed from collapse.

Unemployment

- Farmers in America are becoming massively unemployed and thus unable to buy anything. 

- Supply stays the same but demand falls

- Factories can no longer sell their stuff and have to lay people off

Confidence in economy falls

0

Black Thursday

Thursday, 24 October 1929

Shares --> buy piece of the company and share in the profits. (or sell it for more money than you bought it for)

Many Americans bought shares with borrowed money. 

Stock market crash

US banks had lent money to consumers and businesses far too easily. If those people can no longer pay back the loans, the banks will collapse. 

- Explain how the free market system is reflected in this? 

- The Stock Market Crash is the start of the Great Depression. 

Economic crisis that leads to a lot of unemployment 

and poverty in America. 

De Weimar Republiek

Loans

Dawesplan

Recovery payments

Repaying loans

1. Put the events of the stock market crash in the correct order

When stock prices got irrationally high, people started to sell.

Consumption decreased, which resulted in loss of jobs.

Many people and companies bought stocks

People who were jobless bought less goods, which caused consumption to decrease

Stock prices lowered; people and companies lost a lot of money and went bankrupt.

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