In Zimbabwe, where money has been reduced to worthless paper due to hyperinflation, citizens are forced to panning for gold to pay for bread to stave off hunger.
Hyperinflation is an economic phenomenon, the root of which can be complex–but generally blamed on an increase in money supply, which consequently reduces the value of the money in stock. In Zimbabwe, as of 2008, the inflation rate is estimated at 516,000,000,000,000,000,000% (516 quintillion).
The sordid history of how great increases in money supply led to hyperinflation is chronicled in the wiki entry for Hyperinflation In Zimbabwe, which started with the government printing new currency to pay off international debts in 2006.
We previously featured Glenn Beck’s hockey stick presentation of potential US inflation. Are the US and European bailouts simply another Zimbabwe?
I think you ‘re a wise one to be able to see the social disparties that has brought THIS COUNTRY to ITS’ kleptocratic, TARP stealing, Ben Bernanke, Henry paulson, Alan GREENBACK, Oh! I mean GREENSPAN, Larry Summers, Tim Geithner’s no bank left behind, unfunded mandates, Wall Street gets what Wall Street wants, morally bankrupt knees!
Nobody has any excuse not to prepare for hyperinflation in US.
Why? Because you DON’T need to buy gold or silver.
You can easily
1. Stock up on some canned foods
2. Exchange some of your money for coins
The worst case for this preparation is you wasted your time and you still spend your coins, eat your canned food at home.
But if inflation gets anywhere near abnormally high, coins will be worth metal, and food will be worth food. In fact, see coinflation.com, pennies and nickels are the best bang for buck for metal value right now.
With respect to Kyle above
I think we will have a few more bank failures and more deflation ahead for at least a year more. THEN we will begin experiencing heavy inflation. My predictions are as follows.
1- At some point Bernanke will see inflation seeping into the CPI but will not see it in time. The CPI has so many politically rosy assumptions and substitutions built into it that it is no longer a good inflationary measure. (For a better measure visit http://www.shadowstats.com and look up the alternate data series)
2- Bernanke will sharply raise intrest rates at about the point shadowstats shows CPI at about 18-20% annualized. The Fed chairman did admit that a rising CPI would force him to change strategy in fighting inflation. Before that time Fed Funds rate hikes will be too small to counter the money injected into the system by congress.
3- A rate hike might stop hyperinflation at this point but that seems unlikely. Its dangerous being a debtor nation precisely because you drive unemployment numbers to the moon when you attempt to ring inflation out of the system. At some point the gulf states, China, Russia or Japan might start dumping US dollars for a currency basket or possibly a precious metal in truly large quantity. No amount of rate hikes or “quantitative tightening” by the Fed could stop a hyperinflation Zimbabwe style at this point.
4- At this stage much would depend on weather or not the US citizens and government pushed for a hard metal standard for their money or opted for morgage backed money on mines and other national assets.
4A–If the former then US military dominance will collapse overnight as anything non-essential is defended. Gold and silver backed currency would then put enormous pressure on all remaining fiat currencies. (assuming the average citizen regained the the natural right to convert paper money into gold at government offices at a floating or fixed rate instead of only the elite being able to convert to gold on demand ) Of course the US Federal Reserve would be shut down as the metals fluctuating price would bring information to markets without the need of as socialist or corporatist central committee. America would likely become very isolated from the world community in all areas except trade for a generation or more.
4B– Morgage backed money on mines and other assets is a great bit of financial trickery. As happened in 1920′s Weimar Germany after its hyperinflation, this would lead to something similar to the Nazis taking power. Near dictatorial control would be needed to compensate for the non convertibility of such a currency. Weather we would see the more extreme fixtures of Nazi or Communist dictatorship being replayed in America… death camps, political purges and mass slaughter is anybodies guess. World wide war with the US taking Germany’s 1930′s role in events would seem quite probable.
0.1 grams = a loaf of bread OR for a tin of grain
1 ounce = 28.3495231 grams
1 troy ounce = 31.1034768 grams
1 ounce gold = $924.00 USD
1 gram of gold = $29.70 USD
0.1 gram of gold = $2.97 USD (about $3) = for a loaf of bread, or a tin of grain
Sounds like the people are being overcharged.
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Very Recently, there has been a great deal of litigation by the
FTC against bloggers and website promoters
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What are your thoughts concerning how this could effect
the blogging world?
Clearly better than the prospects for Zimbabwe.
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