Evening star., 1933-10-05

Within a fortnight" ne writes, "the
money was worth but $50; In another
week. $40. 1t vanished before I could
spend it."
Wild Speculation Noted.
Business depends upon relatively
stable, unified, coherent system of
prices, since the business man must
plan ahead and assume risks based on
reasonable profits. The rapid imitation
of the mark. it is pointed out by Prof
Agger, threw prices into ferment
Almost all business became wild spec
ulation, with buyers and sellers equally
affected. Certain lines, like construc
ton trades and those engaged in ex-
port, doomed for time, but alongside
the boom ran the exploitation of labor,
the spoliation of creditors, and the de-
struction of almost the whole middle
class"
Merchants made purchases at prices
calculated to yield them profit, only
to find, when the time came to replace
the goods, that this could be done only
at heavy loss, due to the rapid de-
valuation OF the currency. The gov
ernment found 1t necessary to inter-
vene to prevent the establishment of a
system Of reproduction prices" which
would have shifted the whole risk of
imitation on the laboring classes.
The payment of bond interest in the
United States in paper marks by some
German concerns was widely comment
ed on in the American press at the
time, but this was only a sample of
what happened to creditors as a class
in Germany. The Junkers of East Prus-
sia, whose estates were heavily mort
gagged before the war, cleared up all OF
this Indebtedness in deprecated paper
marks Such spoliation ran into the
billions.
Wages at Revolution Level.
What about the German export trade?
How did Germany succeed in under
selling her competitors in world mar
kets? That is not difficult to answer,
writes the authority referred to above.
German laborers were compelled to
take wages that would bring revolution
in the United States"
The business of gathering together
and distributing capital in Germany
was completely demoralized by the In
flation. No one wanted to keep money
in the banks. In 1922 all savings in
Germany amounted to but 5000, ,000, 900
gold marks, against 10000, 600, 900 re-
ported by the savings banks alone two
yCdIS llCl OpCSuAdtAOh Woo ohARoAAo
and it resulted in overdevelopment in
some fields, underdevelopment In
others. How much of this capital was
remunerative may be gathered from the
fact that dividend payments in 1922,
measured in their gold value, were only
one-fiftieth of what they were before
the war.
Living Standard Shattered.
The decline in the German living
standard was extremely severe. Imports
of coffee, tea, cocoa, fruit, ETC., fell from
57l 600 900 gold marks before the war
to 233, ,00O, 900 in 1921. Per capita meat
consumption fell 32.5 per cent. potatoes
81 per cent and grain q per cent. Even
the consumption Of beer, the great ma
tional beverage. fell from 102 literS per
capita to 80 liters.
When one surveys, at this distance,
the events of 1921 and 1922 in Ger
many, one understands what DR.. Rein
hold, historian of that period, meant
when he said. Loss of confidence in
its legal tender is the most terrible
thing that can happen to any civilized
state"
It win be pointed out that Americas S
experience with fiat money, the green
i back episode, ended in no such disaster
as the experience with the assignats or
the postwar experiences of such coun-
tres ss Russia and Germany, or even