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To: FiveFour who wrote (49665)	1/13/2006 1:24:25 PM
From: kris b	Respond to of 110194

don't recall all the details but "hyperinflation" is already well defined by accountants because of currency translation issues. This might help: Hyperinflation From Wikipedia, the free encyclopedia. Jump to: navigation, search In economics, hyperinflation is inflation which is "out of control", a condition in which prices increase rapidly as a currency loses its value. No precise definition of hyperinflation is universally accepted. One simple definition requires an monthly inflation rate of 50% or more. The definition used by most economists is "an inflationary cycle without any tendency toward equilibrium." A vicious circle is created in which more and more inflation is created with each iteration of the cycle. Although there is a great deal of debate about the root causes of hyperinflation, it becomes visible when there is an unchecked increase in the money supply or drastic debasement of coinage. Contents [hide] 1 Characteristics 2 Root causes of hyperinflation 3 The Weimar Inflation in Germany 4 Models of hyperinflation 5 Hyperinflation and the currency 6 Hyperinflation around the world 7 See also 8 External links [edit] Characteristics Inflation 1923-24: A woman in Germany feeds her tiled stove with money. The money is worth less than firewood.In 1956, Phillip Cagan wrote "Monetary Dynamics of Hyperinflation", generally regarded as the first serious study of hyperinflation and its effects. In it he defined hyperinflation as a monthly inflation rate of at least 50% (prices doubling every 51 days). International Accounting Standard 29 describes four signs that an economy may be in hyperinflation: the general population prefers to keep its wealth in non-monetary assets or in a relatively stable foreign currency. Amounts of local currency held are immediately invested to maintain purchasing power; the general population regards monetary amounts not in terms of the local currency but in terms of a relatively stable foreign currency. Prices may be quoted in that currency; sales and purchases on credit take place at prices that compensate for the expected loss of purchasing power during the credit period, even if the period is short; interest rates, wages and prices are linked to a price index; and the cumulative inflation rate over three years approaches, or exceeds, 100%. Rates of inflation of several hundred percent per month are often seen. Extreme examples include Germany in the early 1920s when the rate of inflation hit 3.25 million percent per month (prices double every 49 hours) and Greece during its occupation by German troops (1941-1944) with 8.55 billion percent per month (prices double every 28 hours). The most severe known incident of inflation was in Hungary after the end of World War II at 41.9 quadrillion (4.19 × 1016) percent per month (prices double every 15 hours). More recently, Yugoslavia between October 1, 1993 and January 24, 1994 with 5 quadrillion percent during this period. Other more moderate examples include other Eastern European countries such as Ukraine in the period of economic transition in the early 1990s, in Latin American countries such as Bolivia and Peru in 1985 and 1988-1990, in Mexico from 1982 to 1988, in Argentina in the aftermath of the 1982 Falklands-Malvinas War, and in Brazil in the early 1990s. Hyperinflation in Mexico eventually forced prices so high that in 1993 Carlos Salinas de Gortari had to replace the peso ($) with the nuevo peso (N$). The parity was N$1 for $1000; in short, he stripped three zeroes from the peso.