Minister von Krosigk: Economy of foreign exchange in detail is necessary. In that, small things also play a part. Equal saving is necessary in spending money within Germany. In contrast to Minister Popitz, he is of the opinion that expenses for armament must be taken over more and more by the regular budget. Expenses above this budget are to be covered
a. by long term consolidation of annually some 2 billion marks.
b. by short term bills of exchange and similarly.
The financing has succeeded up to now by these two means.
However the danger exists, the short-term bills of exchange can no longer be negotiated, so that flooding of the Reichsbank with MEFO bills would have an increased printing of banknotes as consequence.
Minister Popitz: In this case, printing of bank notes is only necessary if the money is absolutely necessary for payment of wages among other unavoidable things.
Minister von Krosigk: The decisive question for that is, whether inflation would actually happen by printing of banknotes to this extent. He does not believe so. The increase of prices observed so far was not caused by monetary reasons, but can be derived from increase of prices for raw materials and agricultural products. Thus one cannot speak of an inflation.
Prime Minister Goering: does not believe that an inflation would happen from the monetary angle.
Measures which in a state with a parliamentary government would probably bring about inflation, do not have to have the same results in a totalitarian state.
Important for this is the application of an appropriate propaganda, so that the co-operation of the propaganda ministry, promised by the Fuehrer, is of great importance.