Greece's hyperinflation crisis during World War II was so bad it resorted to printing banknotes worth 100 TRILLION drachmas
By arseniotoledo // 2025-01-20
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  • Greece experienced extreme hyperinflation during WWII, with prices doubling every 4.3 days and monthly inflation reaching 13,800 percent by October 1944.
  • The crisis was driven by Axis occupation, wartime debt and economic collapse, leading to the issuance of larger and larger banknotes that symbolized the occupied country's economic despair.
  • Hyperinflation devastated daily life, with the drachma becoming nearly worthless, forcing Greeks to rely on barter and foreign currencies for survival.
  • Post-war stabilization efforts, including currency reforms and international aid, eventually restored economic stability, but the crisis remains a cautionary tale about fiscal mismanagement and war’s economic toll.
In the shadow of World War II, Greece faced one of the most devastating economic collapses in modern history. Between 1941 and 1944, the country experienced hyperinflation so severe that prices doubled every 4.3 days, This hyperinflation crisis culminated in October 1944, when monthly inflation rose to 13,800 percent. The crisis, fueled by Axis occupation, wartime debt and a collapsing economy, left the Greek drachma nearly worthless and forced the government to issue a 100-billion drachma banknote – a symbol of the occupied nation's worsening economic despair. Greece’s economic troubles began even before the Axis invasion. In 1939, the country boasted a budget surplus of 271 million drachmas. However, by 1940, the onset of World War II had slashed foreign trade and industrial production, plunging Greece into a deficit worth 790 million drachmas. The situation worsened when Germany invaded in 1941 and imposed a puppet government that demanded Greece support 400,000 Axis troops and pay a hefty indemnity to the Nazis. National income plummeted from 67.4 billion drachma in 1938 to just 20 billion by 1942, while tax revenues collapsed.

Greek collaborationist government turned to money printing, leading to hyperinflation

To cover its mounting deficits, the Greek government turned to the Bank of Greece, which began printing money at an alarming rate. This monetary expansion, combined with hoarding and shortages of basic goods, sent prices skyrocketing. By 1944, the highest denomination of currency had ballooned from 50,000 drachma to a staggering 100 trillion drachma. The hyperinflation crisis devastated everyday life in Greece. By November 1944, the average time a drachma note was held before being spent had shrunk from 40 days in 1938 to just four hours. Basic commodities became unaffordable, and the Greek public lost faith in the drachma, turning to barter and foreign currencies. The issuance of the 100 billion drachma banknote in 1944, signed by then-Bank of Greece Gov. Xenophontas Zolotas, became a grim symbol of the crisis. Adjusted for inflation, the note’s real value today would not exceed €0.10 (10 cents). It was withdrawn from circulation just days after its release, as the government attempted to stabilize the economy through currency reforms. After the German withdrawal in late 1944, Greece's government-in-exile returned to Athens, but the economic challenges persisted. The new government faced massive unemployment, refugee costs and a civil war that erupted in 1945. Efforts to stabilize the currency included two major reforms. The first in November 1944 redenominated the drachma at a rate of 50 billion old drachma to one new drachma. The second in 1954 introduced an even newer drachma at a rate of 1,000 to one. Economist Kyriakos Varvaressos, appointed as economic czar in 1945, implemented measures to control wages and prices, but his policies worsened the budget deficit, leading to his resignation. It wasn't until 1947, with British and American financial assistance, that Greece finally stabilized its economy. The creation of a currency committee and improved tax collection methods helped restore public confidence and bring inflation under control.

Greek hyperinflation crisis serves as a stark warning for the Greece of today

Greece's hyperinflation crisis serves as a cautionary tale about the economic consequences of war, occupation and unchecked monetary expansion. The collapse of the drachma and the social upheaval it caused underscore the importance of fiscal discipline and stable governance, lessons that remain relevant in an era of global economic uncertainty. (Related: Globalism, central bank money printing are the real root causes behind inflation and shortages.) As Greece continues to grapple with economic challenges in the 21st century, the memory of its wartime hyperinflation offers a sobering reminder of the fragility of economic systems and the resilience required to rebuild them. The 100 billion drachmas banknote, now a relic of the past, stands as a testament to a nation's struggle to survive one of history’s most severe economic crises. Watch this video warning about the signs of hyperinflation coming to America. This video is from the ADAPT2030 | Civilization Cycle channel on Brighteon.com.

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