There have been 28 episodes of hyperinflation of
national economies in the 20th century, with 20 occurring after 1980. Peter
Bernholz (Professor Emeritus of Economics in the Center for Economics and
Business (WWZ) at the University of Basel, Switzerland) has spent his career
examining the intertwined worlds of politics and economics with special
attention given to money.
In his most recent book, Monetary
Regimes and Inflation: History, Economic and Political
Relationships, Bernholz analyzes the 12 largest episodes of
hyperinflations – all of which were caused by financing huge public budget
deficits through money creation. His conclusion: the tipping point for
hyperinflation occurs when the government’s deficit exceeds 40% of its
expenditures. Guess what? The U.S. will hit the 40% mark in 2009.”
From Bearish Report
