The National Finances, the Inflation and the Depreciation of the Mark *

The discussions provoked by the depreciation of the mark in Germany during the decade 1914-1923, present an interesting resemblance to the controversies in England in the years which preceded the publication of the Bullion Report. Throughout the period of the inflation the theory held by the Reichsbank, by successive German Governments, by the great bankers, by great industrialists, by German officials, and by a great part of the Press, was that the depreciation of the mark was caused by the state of the balance of payments. During the war Germany had a "passive" balance because of excess imports over exports; later it was accentuated by the effects of the payment of reparations and of the other burdens imposed by the Treaty of Versailles.