.

The second economic crisis was incredible for Zhao Gang. After the second world, the world economy showed long-term prosperity. China relied on strong domestic credit consumption support, Germany achieved surprising economic growth with huge compensation and trade protection, while the US economy lost its competitiveness because it was divided into two halves. It declined in international competition, its economy stagnated, and the fragile and lacked competitiveness in the UK fluctuated in succession of crises. On the contrary, although Russia had to pay huge war reparations to foreign countries and lost Siberia, its domestic social unrest, it relied on huge external debt to renew industrial equipment and became the world's third industrial power.

From a technical perspective, the prosperity after World War II seems to have a solid foundation. Automobile, chemistry and electricity are the dominant forces of this round of technological revolution. China's automobile production increased fifteen times from more than 10,000 vehicles in 1909, reaching an average of one car per 25 people, and its output value accounts for 12% of the total national output value.

The power generation has more than doubled, and various motors and electrical appliances are becoming increasingly popular. Refrigerators, washing machines and TVs have transformed from large pieces into daily necessities. The home appliance industry has quickly become an important part of the national economy. The chemical industry has begun to develop tremendously, and the oil refining industry has developed rapidly. The gasoline production increased from 46 million barrels in 1909 to 700 million barrels in 1927.

The need for automobile tires has promoted the development of the rubber industry. Emerging industries such as rayon and fertilizers have also risen rapidly. However, no one has noticed that aside these new industries, the old industries have not changed essentially. As a representative industry, the shipbuilding industry still lacks competitiveness, and the ship market is mainly occupied by China and Germany.

Labor-intensive industries such as shoemaking and textile industries have begun to lose their competitive advantages due to the rising standards of China's living standards, and their output has stagnated and even decreased. Agriculture has also been in a long-term depression. On the one hand, Germany has limited the protection of its own agriculture in Europe and established protection tariffs.

On the other hand, Argentina, which relies on cheap labor, invested a large amount of grain in Canada into the international market, causing China's agricultural product exports to continue to decline and agricultural product prices to continue to fall. In 1927, the value of wheat in China's exports was only 1/3 and 1/9 of 1909. Considering the vast arable land area (which accounts for almost 4 of the arable land area), it can only indicate that China's agriculture has deteriorated. In addition, the coal industry was replaced by the petroleum industry and railway transportation was replaced by automobile transportation, which was all on the decline. The number of employment in the railway transportation industry decreased from 1920 to 11.7 million.

However, the prosperity of both Germany and China is not based on the booming development of emerging industries, but on the sacrifice of competitors and credit growth. From 1924 to 1927, installment sales increased from 120 yuan to 435 yuan.

In 1926, 70% of automobiles were achieved through sales. More importantly, China's industrial products were cheap and good, with strong international competitiveness, and more and more industrial products exports. Imports and exports were offset by annual surpluses, with values ​​ranging from 300 million to 400 million yuan to 100 million yuan, accumulating a strong capital surplus.

Correspondingly, the European powers were unable to compete with Chinese products that enjoyed high subsidies. Although the automobile, electrical and chemical industries also developed very rapidly, they were still inferior to China. As a whole, after integrating Europe, Germany's trade volume still ranked first in the world. During 1927, the annual trade volume was above 90 yuan, but Germany's share in international trade dropped from 13.9% in 1913 to 10.8% in 1927, and 26% dropped to 22%. The trade changed from a surplus to a deficit, and the highest annual deficit reached 4 marks. The higher the trade product is, the competitiveness of Germany's industrial products is getting worse, and it also makes Germany's domestic trade protectionist force stronger and stronger.

However, Germany's situation is still very good. Germany received huge war reparations from the European and American powers, regained most of Europe, and seized all British colonies in Africa. It almost unified Africa, and to some extent it obtained a resource supply area as large as Europe and hundreds of millions of consumers.

Pig iron production increased from 1.33 million tons in 1909 to 10.36 million tons in 1927, and steel production increased from 1.29 million tons in annually to 972 tons in 1927. Automobile production increased from 54 vehicles in 1920 to 325 vehicles in 1927. What is more meaningful is that Germany protects the domestic market on the one hand, but on the other hand, it uses low-priced prices.

The bank opened up foreign markets, and Germany's exports soared. By 1923, it had already exceeded the amount, and the total import and export volume increased from 27 billion marks in 1918 to 1083 marks in 1927. The huge trade surplus and investment profit return flowed into Germany in large quantities. After 1927, Germany's gold owned was second only to China. Germany's share of world industrial production increased from 15% in 1920 to 28% in 1930. Unfortunately, the overall production proportion in Europe fell by five percentage points, and Germany was actually using economic subsidies from other countries.

Italy is also good. Industrial production in 1925 was 157% of that in 1922. The cotton textile industry, steel industry, and automobile industry are all progressing rapidly. However, Italy's economic development level is still far behind Germany and even the United Kingdom. In 1927, Italy's annual automobile production reached its level.

Russia is a completely different situation. Due to huge compensation, loss of large amounts of industrial and transportation facilities, Russia's prices lost control, and its fiscal and economic chaos. In 1920, Germany was in the need of oppression on China and China was in need of using Russia to restrain Germany, and neither country wanted a revolution in Russia, so it introduced a shock therapy, giving Russia a loan of 12 billion yuan.

Encouraged by this plan, international capital continued to flow into Russia. From 1924 to the year, the total foreign investment reached 320 Jinmak, with Chinese and German capital accounting for half each, followed by American capital. During this period, due to the large amount of capital obtained and the small amount of compensation paid, Russian industrial equipment was generally updated, and the production technology level jumped to the forefront of the world.

Not only that, most of the Russian monopoly industrial groups that have obtained foreign capital are strong Russian, which further strengthened the monopoly of Russian industry. The strength of a large monopoly enterprise is stronger than before. However, as a country, Russia is heavily in debt and needs to pay a large amount of compensation. Although industrial production capacity is quickly restored, people's lives are still very difficult. As long as Russia postpones repayment of debts and pays compensation for political stability, or the investment profits in Russia cannot be realized, the international economic cycle will be immediately interrupted.

The situation in Britain is quite similar to that of Russia. Because Britain was a defeated country and lost its colony on which it relies on, the British industry, which lost a large amount of blood loss, was weak and could not withstand the blows of industries from the United States and Europe. At the end of World War II, Britain received a large number of orders from Chinese industry, and exported luxury goods and ships to China in large quantities, and its economy once flourished.

But then, a large number of Chinese goods flocked to the British and Asian markets, and British goods were retreating steadily, resulting in an unprecedentedly serious economic crisis. From 1920 to 1921, the total industrial output of Britain fell by 19.9%, 88.2%, the mining industry was 55.9%, the machine manufacturing industry was 55.9%, and the prices of major industrial products fell by 55%-82%. Exports fell by 40.3%, the balance of payments deficit reached 350 million UK, and foreign exchange reserves decreased from 1.3 billion pounds to 600 million UK.

In fact, due to the lack of international competitiveness, the UK's trade deficit reached 3.3 billion pounds from 1920 to 1927. Agriculture was not spared, and a large amount of international cheap food was imported into the UK. In addition, the domestic market was depressed, and grain prices fell again and again. Since then, rice and wheat production has stagnated for a long time.

In order to save the British economy, which was already in a deep depression, from 1923 to 1927, the British government borrowed huge amounts of foreign debt from Germany, with a quantity of up to 910 million pounds. By borrowing money and the peace dividends gained after the war, the British government issued up to 1.3 billion pounds of relief to major domestic consortiums, and the British economy gradually got rid of the depression and entered a period of slow development.

—

However, in 1927, the financial crisis broke out in the UK. Some banks were unable to turnover due to their large amount of unsorted mortgage notes, resulting in a run. The economic crisis and depression followed. The government allocated a total of 1.2 billion pounds to help HSBC and other major banks.

Before Britain could breathe, the greater crisis that broke out from China came again. This process had two far-reaching consequences. One was that it owed huge international debts, which became an important link in the international debt chain that caused the Great Depression. The other was that a large number of small and medium-sized enterprises went bankrupt and the British industry was highly monopolized.

So fundamentally speaking, it is China and Germany's selfishness that led to this economic crisis.
Chapter completed!