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Why Mish is wrong on Hyperinflation

By uomo_senza_nome   2013 Jan 8, 6:14am   1 link   571 views   0 comments   watch (0)   quote      

http://howfiatdies.blogspot.com/2012/08/mish-on-hyperinflation.html

Mish thinks people would not decide to have hyperinflation. I don't believe there has ever been a "decision to have hyperinflation". Hyperinflation is when things get out of control. It is not something central banks or government voted on. No group in government or a central bank has had a show of hands like "all in favor of hyperinflation raise your hands". Not the way hyperinflation happens. Hyperinflation is a market response to government debt over 80% of GNP and deficit over 40% of spending when the central bank starts printing money and buying up government debt. Everyone thinks they just need to print a bit more money to make it through the next week or month and there is nothing else they can do since the government needs money to keep in operation. Nobody votes for hyperinflation. Nobody wants it. It just happens.

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