Due to the fact that the Germans had no goods or raw materials to trade, because the treaty of Versailles also took away a large proportion of their industry, the government thought that it would be a good idea if they just printed more money. This way they thought they could pay off their debts in worthless marks. This repayment also included their war debts. The great industrialists would also be able to pay off their debts overnight. This however started a chain reaction with money printing spiralling out of control.
To compare prices: a loaf of bread in 1918 would cost you 0.63 Marks, but by November 1923 it would set you back nearly 201,000,000,000 Marks. This is a price increase of roughly thirty-two thousand billion percent (32,000,000,000,000 %). Also by 1923 people were bringing home their wages, which were paid daily, in wheelbarrows and suitcases. It was also common for people to light fires and cigarettes with banknotes because it was cheaper than striking a match. (a match was worth about 1,000,000 Marks by 1923! Price increase was also so great that by the time that you got to the front of the queue for food the price may have as much as doubled.
People were hit hard by hyperinflation. A well-off middle class family would find that the savings that they had in the bank would have bought them a house in 1918. However it would not even buy a loaf of bread in 1923. Pensioners that could survive happily on their pensions found that it would not buy them as much as a cup of coffee.
Winners of the hyperinflation included big landowners and businessmen. This is because the price of property rose with the inflation so they never lost out like the poorer citizens.
The allies did not fall for the trick played on them by the Germans. They did not accept the worthless marks. What the hyperinflation did do was rally international sympathy for Germany. So much so that the USA agreed to issue loans, to Germany, to help stabilise the economy.
By 1924 the German economy was very unstable and could collapse at any minute. This was mainly due to the loans from the USA that could be called in at any minute. If they had it would have thrown the republic and Germany into total financial ruin.