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  • Chris Stone

Gone hyper


I found a great post about inflation by Tim Harford (The Undercover Economist) who is one of my favourite economic commentators - subscribe if you don't already. Here is a sectionabout hyperinflation from Tim's post that I found very interesting.

In 2012, economists Steve Hanke and Nicholas Krus assembled a list of every confirmed episode of hyperinflation in history. There weren’t very many: 56 in total, mostly in the 20th century, to which we might add recent outbreaks in Zimbabwe, Iran, Venezuela and perhaps North Korea. France suffered a bout in the 1790s, but most instances of hyperinflation occurred either in central European states after the first world war (including the infamous crisis in Weimar Germany), or during or immediately after the second world war (including Hungary, history’s worst example of hyperinflation), or in the eastern bloc as the Soviet Union disintegrated.

Hyperinflation does not strike at random, and it does not happen because central banks briefly slumber. It must be manufactured by the relentless printing of money, generally as the last resort in the face of political dysfunction alongside a severe fiscal crisis. Perhaps it is rash to say so, but I think we can set aside fears of hyperinflation in an advanced economy today. If it ever does happen, it will be only one element in a far more comprehensive economic disaster.

From ‘Why inflation is good for us’ by Tim Harford


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