John Fredrick Parker
Donor
Was thinking about this scenario lately, a couple of new thoughts:
First, what happens with the Sexual Revolution seen in Weimar Germany, and to a lesser extent elsewhere in the 1920's, without the rise of the Nazis or WWII?
I also wondered how the global gold standard would be affected without Bretton Woods, and got this great answer:
First, what happens with the Sexual Revolution seen in Weimar Germany, and to a lesser extent elsewhere in the 1920's, without the rise of the Nazis or WWII?
I also wondered how the global gold standard would be affected without Bretton Woods, and got this great answer:
Everyone but the gold bugs wanted to get off it. The Germans were moving in that direction, but Versailles and Hitler prevented it because he wanted control over the currency that free floating wouldn't give. Likely the Germans dump gold ASAP without Hitler and Schacht, assuming he gets into a position of authority, works out a bunch of trade deals and clearing arrangements, plus gets into trade dumping to pump up the German global position. Without rearmament Germany could export tons more, especially military equipment and actually end up dominating a lot of lucrative markets and outcompeting the Brits. China could end up being a super market for them if Japan isn't allowed to get away with invasion sans Hitler. The French will cling to it longer without having to worry about rearmament, same with the Brits. The US had dumped it during the Depression, but might come back to it like they did after WW2 if the economy stabilizes. I think it will continue on in economically conservative circles while risk taking states with little options to accumulate gold, like Germany, are an example of what a long term free floating currency looks like. There will not be a petrol dollar or a US let global economy system like Bretton Woods even if FDR somehow gets Europe to work with him on a global response to trade collapse. There is too much opportunity for Germany to want to work with the US on an international system, because in the chaos they can use their economic leverage to create a neo-colonial empire sort of like what China is doing in Africa now. Ironically the Gold Standard colonial states will be in serious trouble when their colonies break off, because they are totally unprepared for global competition for markets in the post-gold new age. The world will probably look like more of barter economy with trade blocs on a new neo-colonialist model ironically led by Germany, who IOTL under Hitler was more concerned about forming an old school empire in Europe; Schacht might well be the 'wizard' the creates the new game in the anarchy that is the world trade system post-Depression and during the collapse of the imperial systems.
This book lays out what Schacht was trying to do and might well prove to be the model for European states as their empire collapse:
https://www.amazon.com/Hitlers-Shadow-Empire-Economics-Spanish/dp/0674728858/ref=asap_bc?ie=UTF8
Germany IOTL post-WW2 did pursue a somewhat similar policy of finding captive markets to exploit via capitalism rather than mercantilism. The German corporate model of cartelism would be pretty formidable and aimed and conquering foreign markets. As it was companies like IG Farben dominated Latin American pharmaceutical markets until WW2 cut them off and the US took that over, so as per their pre-war bi-lateral trade deals they will try and create barter deals to get around the lack of cash/gold and make gold effectively superfluous in their model, which I think might evolve into an alternative system that countries would adopt that don't want to play by the gold rules.