Made in Germany : the German currency crisis of July 1931

may have failed because of problems that were not of their making. They could have
been forced into an impossible position by macroeconomic events. Alternatively,
banking problems by themselves might have been a catalyst for a run on the mark. This
seems to have been the case in Austria, where the poor policies and consequent
unsustainable asset position of the Creditanstalt led to a run on the schilling.
Finally, was the crisis the result of a political or economic failure? As in the other
dimensions, the crisis clearly represented both aspects. There had to have been a political
decision that would have avoided crisis if only it had been politically feasible. The crisis
did not result from a presidential election or court decision that was divorced, even in the
short run, from economics. We do not mean to say that either politics or economics was
missing from the German crisis.
But we do seek to identify the changes that led to crisis. We seek to distinguish
between, say, structural problems of German banks—an economic factor—and
government budgetary actions—a political factor. Both may well have been present, but
which was more important in causing a crisis? If the banks were so unstable that any
slight perturbation of conditions would have pushed them into insolvency, then political
factors were only one of many possible shocks that lit the flame. If the government's
budgetary actions were making the banking problem worse rather than better, then
perhaps any banks, however well-run, would have suffered and even failed. As before,
we seek the events that led to the crisis even though the crisis itself had many aspects.
Historians have formulated narratives of 1931 that explicitly and implicitly take
positions on these matters. For example, the initial German response to the crisis was to
blame foreigners for withdrawing their deposits in Germany and selling marks. 4 In this