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How Did The Dawes Plan Lead Up To The Great Depression

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Through the Dawes plan there was a temporary relief for the growing unrest of the German public and it posed a temporary solution to end the ongoing crisis. With the American investment the German economy began growing which caused a decrease in violence and radicalism on the streets. Once civil stability had been restored, Stresemann began stabilising the German currency, which promoted confidence in the German economy and allow them to return to paying their reparations , while at the same time feeding and supplying the nation. The period from 1924-1929 would become known as the „Goldenen Zwanziger“ (the golden twenties). Through increased consumer confidence and purchasing power based on the implementation of the Reichsmark and the continued …show more content…

The financial support of the United States allowed for a rapid recovery of the German economy which, despite the hyperinflation of 1923, even enabled it to return to being one of the largest global economic powers. However in 1929, the onset of the depression in the United States through Wall Street Crash produced a severe shockwave in Germany. When American banks withdrew their loans to German companies, the onset of severe unemployment could not be stopped by conventional economic measures. Unemployment grew rapidly and reached 4 million in 1930. For many German people the onset of the Depression felt like a return to the suffering of the hyperinflation crisis. This caused them ultimately to completely lose trust into the ability of the Weimar Republic to ensure constant economic stability and the longevity of progress. Therefore they seeked more radical political parties as they saw them as a better alternative to the repeated failure of democracy under the Weimar Republic. This caused a return of civil unrest which further escalated the situation as supporters of the radical left communist party KPD began to clash with SA of the fascist

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Inflation eventually peaked at a rate of over 305 percent in 1921, drastically reducing the value of the German currency and leading to a severe economic crisis. Due to these high expenses, Germany experienced inflation of almost 100,000,000%, making it necessary to employ wheel barrels of Marks in order to purchase bread (Document 6 and 7). At the height of the crisis in 1923 German currency had become completely worthless, making it difficult for the country to pay its debts. One U.S. Dollar was worth 4 trillion German marks (Document 6).

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This tragic event sent Wall Street into a complete frenzy and took out millions of investors. Over the next few years, consumer investment and spending decreased. This caused sharp declines in manufacturing production and rising levels of unemployment. By 1933, 13 plus million Americans were unemployed and nearly half of the country’s banks failed (Coker, 2005). Thanks to the reform and relief measures placed by President Franklin D. Roosevelt helped diminish the most horrible effects of the Great Depression.

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The Great Depression in United State from 1929-1939 Great depression the economic crisis of a nation, and it’s affected the whole world. The great depression was one of the most severe and worst economic crisis that the united states have ever experienced in history. The United States was a state that was flourishing in its economic system, their power of industrialization was booming, consumers were spending and investing, there was economic growth. But around October 24th 1929, which was also known as black Thursday there was a stock market crash, the value of stocks dropped, and cross the country hyperactive brokers hurried to place sell order. This fall in the stock market sent the United States into a shock and swabbed out a lot of investors.

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The economy began to improve once again in 1938, but this second severe contraction reversed many of the gains in production and employment and prolonged the effects of the Great Depression through the end of the decade. The hardships of the Great Depression charged the rise of the political movements in a variety of European countries. When President Roosevelt proceeded to give his full support of Britain and France in the fight against Germany including the Axis Powers in World War II. Manufacturing then began to go up and because of that it produced more jobs and caused reducing of the unemployment rate. The Great Depression finally had ended when the United States began to focus and put all of its attention on World War II

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This led to the Wall Street crash where 9 million people lost their savings and ensued in a bank crisis. Consumerism plummeted and failing businesses laid off workers, where around 12 million people were unemployed by 1932 and the unemployment rate was 33% in 1933. “The Crash exposed the weaknesses that underlay the prosperous economy..” (Leuchtenburg) states how the crash revealed the underlying crippled economy the US had and how it completely shattered the economy. The nature of the Depression was caused through a range of causes and the situation deepened from the

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In Germany, unemployment rose sharply beginning in late 1929, and by early 1932 it had reached 6 million workers, or 25 percent of the work force. The Great Depression Begins :The Stock Market Crash “The Wall Street Crash of 1929, also known as Black Tuesday (October 29)] the Great Crash, or the Stock Market Crash of 1929, began on October 24, 1929 ("Black Thursday"), and was the most devastating (stock market crash in the history of united states), when taking into consideration the full extent and duration of its aftereffects. The crash signaled the beginning of the 10-year Great Depression that Image result for stock market crash of 1929 timelineaffected all Western industrialized countries.” What got us out of the Great Depression?

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The Dawes plan addressed the two problems surrounding Germany, by reorganizing the Reichsbank, the German central bank, and to issue new monetary unit - the Reichsmark. According to the plan, the amount of Germany's reparations was determined to correspond to the financial health of Germany, and the plan ensured that it would not hurt the stability of the new monetary currency. However, Germany was only able to pay its reparations by borrowing more money from abroad. The Young plan adopted in 1930 therefore reduced the amount of reparations by further

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According to Mcelvaine (2004), the crash accelerated the downward spiral of the economy wiping out the paper wealth investors and altering the previously euphoric outlook of so many people into one pessimism, which made them more cautious of their spending and their investments and due to this they needed further demand. The money supply had major effects on the economy as well. If there is no money, then prices would have to fall and this could cause deflation, which is what caused the Panic of 1893, before the Great Depression took place. Germany dealt with hyperinflation and this contributed to the Depression. One way was that it wreaked havoc on the German economy and several European countries and they never fully recovered (Mcelvaine, 2004).

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Adolf Hitler had a role to play in ending the Great Depression. As In an effort to protect their money, many Europeans began to invest in US stocks and bonds. This allowed the US to make money without spending money, as more money entered the US without having to print more bills. American businesses were inspired to begin investing again, allowing for more money and jobs in the US. As Hitler attempted to conquer Europe, Europeans sought to protect their money in American stocks

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By Hindenburg and Von Papen giving Hitler the role of Chancellor – thinking that Hitler can be easily manipulate. Furthermore, without the Great Depression and its world-wide economic crisis, the Nazi party would have remained a small political group without much of a say in the government like it had been from 1924 – 1928. During this period, Germany was slowly but surely recovering from the hyperinflation period. The Nazi fed off this Depression a gain a foothold in the

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It was one of the most economic crisis of all time. The depression was the worst plummet in history. It began in the united states but quickly became a worldwide known problem. The Depression hit hardest those nations that were most deeply indebted to the United States, Germany and Great Britain. In Germany, unemployment rose beginning in late 1929, and by early 1932 it had reached 6 million workers, or 25 percent of the work force.

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The years 1924 to 1929 were known as the “Golden Years” Germany became progressively successful and peaceful. The United States lent Germany huge sums of money. The economy was rebuilt, unemployment was reduced and people began to feel secure. As a result, Germany was no longer the second most economically advanced nation in the world.

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However German government printed more money to pay off the debt but it caused inflation. The government had 300 million papers and work 24 hours a day to pay a huge amount of debt. Germany wasn’t earning money properly, so it didn’t affect their wealth, which means they were still poor while they are keep making money. So prices of goods and education and services rose quickly. So many people didn’t go to the hospital, because it was too

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The people of Weimar Germany were using wheelbarrows to carry their money to go shopping. Pensioners were hit hard by hyperinflation as their fixed income pensions became worthless as well as middle class workers whose savings had become valueless as prices soared. People went to extreme measures to survive such as, during the winter of 1923, many burnt their furniture to keep their fires burning for heat as well as restaurants were unable to reprint menus fast enough to keep up with the ever changing prices.[4] After making devastating choices to sell family antiques to try and keep up with the hyperinflation in order to survive, it became quite apparent why many middle class citizens, who had experience the wrath of hyperinflation, turned away from the Social Democratic Party and started supporting Communist parties like the Kommunistische Partei Deutschlands (KPD) or the Nationalsozialistische Deutsche Arbeiterpartei (NSDAP) which was better known as the Nazi Party. The shunning of the Social Democratic Party eventually resulted in its

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In the early 1930s the labor force in countries that were industrialized saw as much as one forth of its workers unable to find work. Conditions were starting to improve by the mid 1930s, however total recovery did not happen until the end of that decade. This was a very difficult time in United States history and around the world, but it could be said that something good came out of it, central banks throughout the world now try to thwart or moderate recessions. It is unclear whether a change like this would have occurred if not for the

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