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John Burns
Posted 10/11/2016 15:18 (#5575872 - in reply to #5575276)
Subject: when money dies



Pittsburg, Kansas

The ones hardest hit are the ones on fixed income or the ones that do not have leverage to demand higher wages.

People can't afford things in hyperinflation. They tend to only buy the essentials, and even these are hard to afford. Luxury items may be priced high compared to their previous price, but will be cheap relative to essentials. Anyone with sound foreign currency or a valuable commodity can buy luxury items on the cheap.

Actually government employees and those in unions tend to do far better than some. At least that is the way it has worked in the past.

Remember, hyperinflation is really a deflationary event. The economy is completely deflationary when measured in any currency or commodity other than the domestic currency that is hyperinflating. This is very hard for people to understand that hyperinflation is nothing like ordinary inflation other than the similarity of prices rising. Hyperinflation usually starts in a deflationary setting.

Hyperinflation is a currency event. Specifically it is where people loose confidence in the currency to hold its value. It is not where demand has become higher for goods, but rather a depreciation of the currency.

I highly recommend this book. When Money Dies

It is a very interesting read even if you do not feel the need to know about hyperinflation or that you could ever be affected by it.

John



Edited by John Burns 10/11/2016 15:22
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