The hyperinflation that still scars the contemporary German psyche so deeply was not, as noted in chapter 3, promoted by some kind of misguided Keynesian stimulus. Rather, it was the German government's deliberate policy, designed to make the payment of reparations, especially after the French occupation of the Ruhr, all but impossible. In that regard, it was quite successful. Knowing that the reward for putting their fiscal house in order would be giving the French even more money meant that Germany decided to pull the fiscal house down. … Inflation proved to be a formidable weapon against reparations creditors, at least in the short run. It helped insulate Germany from the international slump of 1920/21, improving her export position and fueling internal demand. … It also exploited Germany's remaining foreign creditors, largely neutral countries, by depreciating the paper mark reserves they had accumulated during the stabilization period. … Above all, it paralyzed the financial system that would have been needed to organize an orderly transfer of reparations.

Mark Blyth, Austerity, loc. 525