Blood and iron, gold and iron, coal and iron, rye and iron – these are among the most vivid images in the history of the German Reich. We think of Bismarck's speech to the Prussian Diet's budgetary committee in September 1862, of Bleichroder's financing of the iron Chancellor's wars, of Keynes's comment on the economic roots of-German power, of Kehr's stress on the role of agrarian and industrial interest groups in Wilhelmine politics. This book, however, turns away from these more familiar themes of German historiography, to consider the relationship between paper and iron – in particular, between the paper instruments which financed the economic life of Germany's largest port, and the iron ships built there to transport and protect its commerce; more generally, between the paper notes and bonds produced by the Reich printing press in Berlin's Oranienstraße, and the industrial and military power of the Reich itself. The principal question it seeks to address is: what were the causes and consequences of the German Reich's chronic susceptibility to inflation?

It is fair to say that, until relatively recently, historians tended to be more interested in deflation than inflation as a factor in the historical development of the German Reich. The two economic events which were seen as having had the most decisive influence on modern German history were, firstly, the Gründerkrach of 1873–4 and the subsequent period of stagnation, linked by Rosenberg and others to the crisis of liberalism in the late 1870s; and, secondly, the Slump of 1929–32, usually seen as the main cause of the collapse of the Weimar Republic.