America is going to wonder why no one warned them of hyperinflation.
Posted by John Reed on
“Why were we not warned of this?” will be the question on everyone’s lips if and when the USD hyperinflates.
If you Google “inflation,” you will find an increasing number of media stories.
But if you Google “hyperinflation,” you will find next to zero.
Is hyperinflation a subset of inflation? More like the other way around. Hyperinflation is to inflation what lightning is to a lightning bug.
Succinctly, hyperinflation wipes out all your dollar-denominated assets (cash, bank accounts pensions, annuities like social security, cash value life insurance, American bonds, certificates of deposit) and your dollar-denominated debt (mortgages—other types of debt may be called—that means pay it off right now).
Wiping out your dollar-denominated debt is a good deal.
You non-dollar denominated assets (real estate, commodities like bullion, inventory, vehicles and equipment, foreign currencies) more or less retain their purchasing power. But some of them, like real estate, are NOT LIQUID.
You still have to pay your routine and rainy day bills in USD. Except for your fixed-rate mortgage, your bills will soar. So MIGHT your pay, but your pay and the value of your stocks are mixed bags in hyperinflation. They may fall short of inflation rates.
More important are the daily effects of the combination of hyperinflation and the five bad laws that always accompany it: capital controls, price controls, rationing, anti-hoarding laws, and financial repression laws.
Daily life will be empty store shelves and a constant search for some non-dollar assets that you can barter illegally with black marketeers for food, fuel, paper and hygiene products, and medicine.
Empty store shelves and the fact that black market is far smaller and screwed up mean starvation. Many readers think that is impossible in America third-world stuff.
Nope.
If and when it happens, while not killing their pets to eat them, people will ask, “How come we are suffering hyperinflation—the biggest crisis in US history—worse than the Great Depression—and I almost never heard the word hyperinflation until I was in the middle of it?”
Why did the experts and the out-of-power politicians not warn us that all this deficit spending was taking us off this cliff?
1. Intelligent people are not allowed to speak the word hyperinflation. To do so gets you labeled a tin-foil-hat-wearing kook.
2. People are afraid that if they even mention hyperinflation and we subsequently get it, they will be blamed for CAUSING it.
If you see the problem and if you say the problem, you ARE the problem.
These are idiotic reasons to sin by silence when you should be yelling “Fire” in a crowded “theater” that is, in fact, on “fire.”
The highest debt-to-GDP ratio in US history was 122% after WW II. We had War Bond Drives then so that debt was owed to real citizens who loaned their own real money to the government. Our debt-to-GDP ratio now is higher—126%—and there has not been a single “Entitlement Bond Drive.”
Furthermore, Biden and the Dems are in a frenzy to add another $10T in debt on top of the current US record debt.
The experts and the GOP politicians and some Dems are warning tentatively that we might get inflation and are already getting inflation. But no one is pointing out that the Dem spending is risking you and your family starving.
Seems like that might head off the passage of the new spending bills. But the experts and anti-more-debt-politicians are more afraid of being labeled a kook and/or getting blamed for hyperinflation than they are afraid of getting blamed for not warning you. This is monstrous, selfish silence.
Generally, I do not even think the sinners by silence are taking steps to protect themselves from the hyperinflation. They are deer in headlights.
Well, I warned you. But as many parents have learned with regard to trying to help their children to avoid repeating the mistakes the parents made when they were young: you can lead a horse to water, but you can’t make him drink.
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