The French Invasion of the Ruhr and Hyperinflation

From Wikipedia Commons

The French Occupation of the Ruhr took place from the 11th of January 1923 to 25 August 1925 where French soldiers invaded and occupied the Ruhr (German Industrial Area) after the Weimar Government was unable to pay the reparations.

The French began to take coal, machinery and other resources from the Ruhr as payment for reparations.

The Government decided to call on the workers in the Ruhr to go on strike with the aim of resisting the French Occupation.

Although the French left the Ruhr, there was still a problem. The Government had printed much more money between March and November of 1923 as they needed to pay the striking workers. This led to Hyperinflation (where currency becomes almost worthless) and many people lost their savings and the price of goods increased.

To solve the problem of Hyperinflation, the Weimar Republic asked the USA to loan money, which they could use to pay the reparations and invest in the German economy.

They also decided to scrap the old currency and introduce a new one, which was called the Rentenmark. They then knocked off the noughts and strictly limited the amount of the new currency that could be printed before a new one was introduced.