When workers were paid twice a day and given half-hour shopping breaks (Germany, 1923)

 Here is Michael K. Salemi on hyper inflation. He is an economics professor at the University of North Carolina in Chapel Hill.

"Inflation is a sustained increase in the aggregate price level. Hyperinflation is very high inflation. Although the threshold is arbitrary, economists generally reserve the term “hyperinflation” to describe episodes when the monthly inflation rate is greater than 50 percent. At a monthly rate of 50 percent, an item that cost $1 on January 1 would cost $130 on January 1 of the following year.

Hyperinflation is largely a twentieth-century phenomenon. The most widely studied hyperinflation occurred in Germany after World War I. The ratio of the German price index in November 1923 to the price index in August 1922—just fifteen months earlier—was 1.02 × 10¹⁰. This huge number amounts to a monthly inflation rate of 322 percent. On average, prices quadrupled each month during the sixteen months of hyperinflation."

1.02 × 10¹⁰ means 10,200,000,000. So something that cost one Mark ended up costing 10,200,000,000 Marks 15 months later.

Here are some of the unusual things people did to cope.

See Igniting The Holocaust - Facing History and Ourselves: Burning Money: Hyperinflation in the Weimar Republic.

"By the fall of 1923, workers were paid twice a day.  After each pay they were given time off to go shopping, so that prices wouldn't rise any further.  At the height of hyperinflation, just buying the day's food could cost trillions of German marks; people had to shop with backpacks and wheelbarrows to be able to carry their money -- and many people who had been managing just fine found themselves starving."

See Hyperinflation by John D. Clare.

"As soon as the factory gates opened and the workers streamed out, pay packets (often in old cigar boxes) in their hands, a kind of relay race began: the wives grabbed the money, rushed to the nearest shops, and bought food before prices went up again. Salaries always lagged behind, the employees on monthly pay were worse off than workers on weekly. People living on fixed incomes sank into deeper and deeper poverty.

       A familiar sight in the streets were handcarts and laundry baskets full of paper money, being pushed or carried to or from the banks. It sometimes happened that thieves stole the baskets but tipped out the money and left it on the spot. There was dry joke that spread through Germany: papering one's WC with banknotes. Some people made kites for their kids out  them.

Egon Larsen, a German journalist, remembering in 1976"

See German hyperinflation: Loads of money from The Economist.

"The hyperinflation and widespread unemployment in Germany in the 1920s was not something we can relate to from our own experiences, but you can see from the passage below how it would wreck an economy and a society and set the stage for the rise of a fanatic promising a better future. 'FOR these ten marks I sold my virtue,' were the words a Berliner noticed written on a banknote in 1923. He was buying a box of matches, all the note was worth by then. That was in the early days. By November 5th, a loaf of bread cost 140 billion marks. Workers were paid twice a day, and given half-hour breaks to rush to the shops with their satchels, suitcases or wheelbarrow, to buy something, anything, before their paper money halved in value yet again."

See Children playing with stacks of hyperinflated currency during the Weimar Republic, 1922 from Rare Historical Photos.

"By mid-1923 workers were being paid as often as three times a day. Their wives would meet them, take the money and rush to the shops to exchange it for goods. However, by this time, more and more often, shops were empty. Storekeepers could not obtain goods or could not do business fast enough to protect their cash receipts. Farmers refused to bring produce into the city in return for worthless paper. The requirements to calculate and recalculate commercial transactions in the billions and trillions made it practically impossible to do business in paper Marks.

Millions of middle-class Germans, normally the mainstay of a republic, were ruined by the inflation. They became receptive to rabid right wing propaganda and formed a fertile soil for Hitler. Workers who had suffered through the inflation turned, in many cases, to the Communists."

Related post:

World War I Finally Ends (a post from 2010 when Germany made the last payment for war reparations from World War I in 2010 that may have contributed to the hyper inflation)