June 28, 1919 – Keynes predicts economic chaos

June 28, 1919 – Keynes predicts economic chaos

On June 28, 1919, the day that the Treaty of Versailles is signed in Paris, John Maynard Keynes warns that the war reparations imposed on Germany in the punitive agreement would cause worldwide economic havoc.

When catastrophic German inflation and a world depression proved him right, Keynes advocated government spending to create employment.

A brilliant economist, the eventual establishment of the International Monetary Fund and the World Bank owed much to his ideas.