Because of high inflation in Turkey, its citizens are fleeing to Europe. I have repeatedly told readers here that if we get hyperinflation here, you will have to leave the U.S.
That seems to meet with a lot of resistance. It is not debatable. The average Venezuelan has lost 24 pounds due to their hyperinflation.
One Turk says in today's WSJ, "We used to cook meat every day. Now it's just once a week." Another Turk said his family had to stop eating meat at all.
Another of the Five Bad Laws that hyperinflated governments always pass is RATIONING. Turkey is now rationing sugar and flour.
Tourism is UP in Turnkey. Of course. They have foreign currency to spend. Foreigners are treating like kings in hyperinflated countries and get to pay bargain prices for everything.
You might actually want to go to a hyperinflated country now for two reasons: it is super cheap for foreigners and to see what hyperinflation in the US will be like.
Many American creative people like Earnest Hemmingway lived in Paris in the 1930s because it was nice and cheap for Americans. It is possible that living in hyperinflated countries now as a foreigner and therefore exempt from their capital controls could be an exotic, cheap adventure or maybe even a way to live very cheaply long-term. The current high-inflation countries are
Islamic Republic of Iran 36.44%
South Sudan 23.98%
Sierra Leone 13.45%
Argentina and Turkey are probably the only somewhat nice places on that list. I have never been to any of them. My wife lived in Ethiopia in the 1960s. She has no interest in returning.
Turks are converting their lira to USD and gold. I am surprised they are still allowed to. Hyperinflated countries always enact CAPITAL CONTROLS which prohibit owning gold or foreign currency in the country, and prohibit taking the hyperinflated currency out of the country.
Turks are also having trouble getting MEDICINE because most medicines are imported there and here and hyperinflation more or less ends imports because the selling countries don't want your hyperinflated currency.
I have been saying for years that if we get hyperinflation here, you will have trouble getting food, fuel, and medicine here.
Turkey is also keeping INTEREST RATES low. That means they are negative after adjusting for inflation. That is a bit of insanity unique to Turkey's president Erdogan. All economists worldwide say you have to raise interest rates to fight inflation. He says the Islamic prohibition on charging interest prohibits higher interest rates. Uh huh. The Koran is not generally used in business schools as an authoritative source.
Turkey's government has called on Turks to "eat less, sacrificing for the good of the country."
The next to last paragraph in the WSJ story today says this could trigger a RUN ON THE BANKS and/or Turkey defaulting on its debts. Same if the U.S. dollar hyperinflates, only infinitely worse. The run would not just be on US banks, it would be A RUN ON THE USD WORLDWIDE. No non-Turks hold the Turkish lira. But people and governments worldwide, including Turks, DO hold the USD. If it starts to inflate at a high rate, the entire world will dump the dollar. That would be cataclysmic to the world financial system.
The USD hyperinflating would be an IMPLICIT DEFAULT by the U.S. on its national debt. Whether we also explicitly default (stop sending interest and principal payments to bond holders) would be of little additional significance. That would also be cataclysmic to the world financial system.
Turkey owes some debt to other countries in foreign currency. We, on the other hand, are the largest debtor on earth by a huge margin and all our debt to foreigners is in USD. We will go from being the top nation and top trustworthy good guy to deadbeats who stole money from billions of people around the planet.
Richard Wright, Tim Nichols and 1 other