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Gold/Mining/Energy : Gold and Silver Juniors, Mid-tiers and Producers
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To: Proud Deplorable who wrote (57009)2/26/2008 9:27:12 PM
From: pogohere   of 78417
 
Very the very picky detail dept:

Sinclair (for whom I have the greatest respect) always refers to “reparation payments” as a factor in the Weimar inflation; i.e., inferring that the Reichsbank printed Deutschmarks to pay reparations.

Reparations were payable in the currency of the foreign creditors (the WWI victors), not in Deutschmarks. According to Hjalmar Schacht--who was appointed the Reich Currency Commissioner in November 1923 and was President of the Reichsbank from Dec 1923 to Jan 1930 and from March 1933- Jan 1939 [when he was fired by Hitler for failing to endorse credits for greater military expenditures] and who twice managed Germany's way out of the crises of those years*--the banknotes printed by the Reichsbank were for domestic use and were used by speculators to speculate against the Reichsmark. "It [the Reichsbank] held the view that it was useless to attempt to stabilise the currency so long as the Ruhr was occupied and the war debts remained unfixed. . . . The legislation of 1922, which was intended to free the Reichsbank from the claims of the state, came to grief at the decisive moment because the Reich could not find any way of holding its head above water other than by the inflationary expedient of printing banknotes."

Schacht, "The Magic of Money,"1967, p.65-66

* with the creation of the Rentenmark in his first term and the MEFO program in the second.
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