The Wages of Destruction: The Making and Breaking of the Nazi Economy

by Adam Tooze

But, in the autumn of 1938, at the moment of Hitler’s greatest triumph, the economic foundations of his success were in question. The Reichsbank was forced to acknowledge that despite its best efforts, there was ‘no longer . . . complete stability of the German currency’. ‘An inflation of the Reichsmark’ had begun, even if this was ‘not yet fully apparent’. This was an admission that Schacht repeated a few weeks later in a report to the Capital Market Committee (Kapitalmarktauschuss)–the committee of the RFM, RWM and Reichsbank which oversaw the raising of funds on the German financial markets.2 In front of his colleagues, Schacht openly stated: ‘It cannot be denied . . . that we are already on the threshold of inflation.’ To restore the Reichsmark to a state worthy of a great power, Germany needed a restoration of monetary and fiscal stability. Since the spring of 1938, the Reich’s finances had been spiralling towards disaster. For months the Finance Ministry had been living ‘from hand to mouth’ and the Reichsbank had been forced into an ‘inflationary creation of money’.