World War I reparations
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World War I reparations were a series of payments the German state was forced to make following its defeat during World War I, under Article 231 of the Treaty of Versailles.
The total sum due was decided by an Inter-Allied Reparations Commission. In 1921, this number was officially put at £6,600,000,000. In many ways, the Versailles reparations was a reply to the reparations placed upon France by Germany through the 1871 Treaty of Frankfurt. Signed after the Franco-Prussian War, France took huge loans in order to pay the reparations by 1873, because the Treaty conditions allowed the German Army to occupy France until the war reparations were paid. The Versailles Reparations came in a variety of forms, including coal, steel and agricultural products.
A major historical fallacy is that the reparations were the source of the economic condition in Germany from 1919 to 1939. Germany paid very little of the reparations and the hyper-inflation of the early 1920s was because of the political and economic instability of post-Kaiserreich Germany. In fact, the occupation of the Ruhr by the French because the Germans did not pay the reparations did more damage to the economy than if the Germans had actually paid it. Another fallacy is that these reparations caused the economic condition that saw Hitler's rise to power. Germany was in fact doing remarkably well after its hyper-inflation of 1923, and was once more one of the world's largest economies, until the foreign investment funding the economy was suddenly withdrawn with the Stock Market Crash of 1929.