‘Dancing on a Volcano’: The Economic Recovery and Collapse of Weimar Germany, 1924–33

In late 1928, the Agent-General for Reparations, Parker Gilbert, had a conversation with Gustav Stresemann on the reasons for the country’s regained prosperity and its further outlook. Germany had witnessed a spectacular recovery from its postwar muddles: the hyperinflation was over and the gold standard restored, democracy had stabilized, reparation payments proceeded in an orderly manner, and the French were retreating from one occupation zone after another. The international confrontation of the early 1920s seemed a thing of the past, and a certain degree of political cooperation and détente had established itself. Germany enjoyed the fruits of restored international confidence, and more and more international capital flowed into the country. German bonds sold well in foreign markets, and US direct investors flocked into the country to spot profitable investment opportunities. It was in those pre-Depression years when companies like General Motors, Ford, and General Electric arrived in Germany. In a matter of only a few years, the German way of life would become a perfect imitation of the American one: motorization and the electrification of private households were just around the corner. So at least it seemed.