What would you do if the US were attacked and the attackers came with the intentions of creating hyperinflation on US soil? Would you flee? Would you fight or surrender? What is your survival plan, considering how vulnerable the dollar is? How long have you lived without money to pay for electricity and purified water or gasoline to drive to a huge grocery store a short drive from your home (if you have any money left)? What can you do for yourself if there is no structure in order to do everything for you?
PS (hope you don’t mind I borrowed on your post Athena)
I’d hide out and kidnap them one at a time. Then I’d torture and decapitate them and make videos of the whole thing. I would even do this to women and children, hell, especially women and children. I’d poison the water. I’d burn all the crops and set the oil pipelines on fire.
Similarities between Germany’s Hyperinflation of 1923 & USofA of 2007
Similarity #1: Both governments went off the gold standard.
Similarity #2: Both governments allowed the money supply to increase substantially.
Similarity #3 – The large increase in the money supply and easy access to credit lead to unproductive speculation and investment.
Similarity #4 - Both governments implied external events, not money creation and overspending, were the cause of rising prices.
Similarity #5 – Both governments told citizens that portions of the large deficits would be covered from external sources.
Similarity #6 – As the money creation lead to rising asset and consumer prices, the need to print more money seemed to feed on itself. The illusion of prosperity and low unemployment was difficult to reign in.
Similarity #7 – Real wages declined even as nominal wages increased
Similarity #8 – Both governments had enormous debts to repay
How did the German inflation end?
When people began to lose confidence in the value of paper money, they began to spend it immediately in an effort to avoid losing purchasing power (this is known as an increase in the velocity of money). In the end, farmers Inflation Hurts Dollar stopped selling produce because they would not accept near worthless paper money. Businesses became unable to keep the shelves stocked or were unable to sell at a profit and thus began to close down. Unemployment began to soar. Today, you need to look no further than the recent gains in gold and silver to see that people around the globe have started to lose faith in global paper money.
For all intents and purposes the U.S. has already experienced hyperinflation: It was called the Carter Administration (before carter inflation was about 6-8% a year while Carter’s inflation got as high as 13-15% a month).
I lived through Carter’s term (I was just a few months shy of turning 13 when he left office). I can still remember my experiences during this period and I am having some of the same experiences again now.
Interesting you should say that. I was listened to some analysts who said that if inflation was calculated as it was under the Carter administration, inflation woud presently flash at 9%.
Unfortunately, I don’t think Bernanke is Volker. Debt levels are incomparable anyhow.
I know that inflation is calculated based on the prices of a standardized set of goods and services and that this standard set is changed ever so often to reflect current buying habits; it used to include tobacco but not computers and the last I heard it included computers but not tobacco.
But, since the standard set of goods and services includes things that not everybody buys (and some things that I may consider to be luxuries), it is not really a good indicator of changes in the cost of living. Furthermore, neither food, nor energy prices are included in the official inflation rate because their prices are considered to be too volatile. As far as I am concerned the only things that should be included in the inflation rate are housing, food, energy, water and clothing- the things that are absolute necessities for everyone.
There is also inflation that the government statistics cannot reflect: loss of product brand selection courtesy of Wal-Mart. Over the past 5 years or so Wal-Mart has done away with more and more of the lowest price brands in several product categories. Just yesterday I found only 2 brands of toothpaste at Wal-Mart that were less than $1 per tube (whether or not the tubes were the same size I don’t know), and only one of these brands was in stock. The next lowest priced brand was $1.88. I would venture that Wal-Mart will eventually do away with both low price brands, but the official inflation rate won’t reflect the increase in my cost of living when the cheapest toothpaste that I can find goes up by 88 cents simply because other brands are no longer offered for sale in my market.
