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To: JBTFD who wrote (79340)	5/21/2008 5:07:50 PM
From: calgarydude	Read Replies (1) \| Respond to of 116555

Doesn't beat the almighty Pengo. "The Hungarian economy could only be stabilized by the introduction of a new currency, and so, on 1 August 1946, the forint was introduced at a rate of 400 000 000 000 000 000 000 000 000 000 or 4×1029 (short scale: four hundred octillion; long scale: four hundred quadrilliard) pengo. The adópengo was replaced at a rate of two hundred million to the forint (hence the 2×1021 ratio, mentioned above). The exchange rate for the US dollar was set at 11.74 forints." en.wikipedia.org I think that this is the current world record for inflation. Ben still has a lot of work to do if he wants to beat the record.

To: JBTFD who wrote (79340)	5/21/2008 5:16:38 PM
From: benwood	Read Replies (1) \| Respond to of 116555

All you had to do was hold $1 in US currency for 16 months and you were a trillionaire in the local currency. Too bad it cost a trillion marks to buy a pack of chewing gum. As an aside, the spell check here hasn't added trillionaire to the spellcheck yet, as it isn't apparently in the dictionary... yet <g>

To: JBTFD who wrote (79340)	5/21/2008 9:32:21 PM
From: koan	Respond to of 116555

Yeah, Weimer republic is sure used as the standard. Europe still shivers because of its remembrance.

To: JBTFD who wrote (79340)	5/22/2008 5:20:49 AM
From: Real Man	Read Replies (1) \| Respond to of 116555

Message 24611332 econlib.org IV.21.16 From time immemorial inflation has been recommended as a means to alleviate the burdens of poor worthy debtors at the expense of rich harsh creditors. However, under capitalism the typical debtors are not the poor but the well-to-do owners of real estate, of firms, and of common stock, people who have borrowed from banks, savings banks, insurance companies, and bondholders. The typical creditors are not the rich but people of modest means who own bonds and savings accounts or have taken out insurance policies. If the common man supports anticreditor measures, he does it because he ignores the fact that he himself is a creditor. The idea that millionaires are the victims of an easy-money policy is an atavistic remnant. IV.21.17 For the naive mind there is something miraculous in the issuance of fiat money. A magic word spoken by the government creates out of nothing a thing which can be exchanged against any merchandise a man would like to get. How pale is the art of sorcerers, witches, and conjurors when compared with that of the government's Treasury Department! The government, professors tell us, "can raise all the money it needs by printing it."4 Taxes for revenue, announced a chairman of the Federal Reserve Bank of New York, are "obsolete."5 How wonderful! And how malicious and misanthropic are those stubborn supporters of outdated economic orthodoxy who ask governments to balance their budgets by covering all expenditures out of tax revenue! IV.21.18 These enthusiasts do not see that the working of inflation is conditioned by the ignorance of the public and that inflation ceases to work as soon as the many become aware of its effects upon the monetary unit's purchasing power. In normal times, that is in periods in which the government does not tamper with the monetary standard, people do not bother about monetary problems. Quite naively they take it for granted that the monetary unit's purchasing power is "stable." They pay attention to changes occurring in the money prices of the various commodities. They know very well that the exchange ratios between different commodities vary. But they are not conscious of the fact that the exchange ratio between money on the one side and all commodities and services on the other side is variable too. When the inevitable consequences of inflation appear and prices soar, they think that commodities are becoming dearer and fail to see that money is getting cheaper. In the early stages of an inflation only a few people discern what is going on, manage their business affairs in accordance with this insight, and deliberately aim at reaping inflation gains. The overwhelming majority are too dull to grasp a correct interpretation of the situation. They go on in the routine they acquired in noninflationary periods. Filled with indignation, they attack those who are quicker to apprehend the real causes of the agitation of the market as "profiteers" and lay the blame for their own plight on them. This ignorance of the public is the indispensable basis of the inflationary policy. Inflation works as long as the housewife thinks: "I need a new frying pan badly. But prices are too high today; I shall wait until they drop again." It comes to an abrupt end when people discover that the inflation will continue, that it causes the rise in prices, and that therefore prices will skyrocket infinitely. The critical stage begins when the housewife thinks: "I don't need a new frying pan today; I may need one in a year or two. But I'll buy it today because it will be much more expensive later." Then the catastrophic end of the inflation is close. In its last stage the housewife thinks: "I don't need another table; I shall never need one. But it's wiser to buy a table than keep these scraps of paper that the government calls money, one minute longer." IV.21.19 Let us leave the problem of whether or not it is advisable to base a system of government finance upon the intentional deception of the immense majority of the citizenry. It is enough to stress the point that such a policy of deceit is self-defeating. Here the famous dictum of Lincoln holds true: You can't fool all of the people all of the time. Eventually the masses come to understand the schemes of their rulers. Then the cleverly concocted plans of inflation collapse. Whatever compliant government economists may have said, inflationism is not a monetary policy that can be considered as an alternative to a sound-money policy. It is at best a temporary expedient. The main problem of an inflationary policy is how to stop it before the masses have seen through their rulers' artifices. It is a display of considerable naivety to recommend openly a monetary system that can work only if its essential features are ignored by the public.