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tresemann stopped hyperinflation by calling off passive resistance in the Ruhr and setting up a new currency called the

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tresemann stopped hyperinflation by calling off passive resistance in the Ruhr and setting up a new currency called the

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Solution

The new currency that Stresemann set up to stop hyperinflation was called the "Rentenmark". Here are the steps he took:

  1. Stresemann ended the policy of passive resistance in the Ruhr. This was a policy where German workers in the Ruhr (a highly industrialized area) were encouraged to 'resist' the French occupation by not working. This was causing economic problems as it was reducing the amount of goods being produced and sold.

  2. He introduced a new currency called the Rentenmark. The old currency, the Reichsmark, had become virtually worthless due to hyperinflation. The Rentenmark was introduced at a rate of 1 Rentenmark to 1 trillion Reichsmark, effectively wiping out the hyperinflation.

  3. The Rentenmark was backed by tangible assets, specifically land used for agriculture and business. This gave the currency stability and helped to restore confidence in the German economy.

  4. Stresemann also negotiated the Dawes Plan with the Allies, which reduced Germany's reparations payments and restructured its debt, further stabilizing the economy.

Through these measures, Stresemann was able to stop the hyperinflation that was crippling Germany's economy.

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