Here https://www.princeton.edu/~ies/IES_Studies/S75.pdf they say that after defaulting on its debt Germany did not repudiate the debt (they feared that this would result in asset seizure and disruption of trade); later it bought back part of it - now that was at a lower price. Now the trick was to keep the repurchase plan secret; because otherwise it would have driven up the price for debt obligations. In the end could not be kept secret forever, so the prices for debt obligations went up, but still they took some advantage in the end.

Also they mainly bought back debt to the US - that's because the US threatened trade disruption in the event of repudiation, and because of the trade surplus they had much to loose.

Now "The German Economy in the Twentieth Century" by Hans-Joachim Braun says that expenses of 80 billion RM accrued between 1933 and 1938; these were payed by

• 56% taxes and income from state held enterprises (?)
• 24% borrowed on long term
• 12% borrowed on short term
• 8% printing presses.

they seem to have borrowed a lot (12 billion RM) on internal market for some sort of bonds/obligations called Mefo bills http://en.wikipedia.org/wiki/Mefo_bills and other paper issues. Still they seem to have been able to borrow externally.

I know this sounds unusual because in the world you and I grew up in there isn't classical warfare or conquest anymore, but the Nazis would borrow most of their money and kept conquering more and more to keep the economic balls in the air.

I remember reading in another question on here that the Germans used alot of gold from Austria, Czechoslovak, and France to postpone economic collapse. You should check similar questions here by using the search bar. Other people really go into detail.