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Old 03-17-2010, 12:51 PM   #12
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Join Date: Nov 2009
Posts: 192
Default Re: Predictions for 2010 by Economic Prophets

I think your idea of hyperinflation is not very 'hyper'. I can understand that someone who has a steady economy, like in the UK a few years ago will have a certain difficulty in understanding about hyperinflation. The UK is already worried because inflation is around 7%! Per year!

You can trust me I know what hyper hyperinflation is.
I was little kid at that time and was purchasing icecream for 2 PLN (polish zloty (meaning golden)) just before they denominated currency the same icecreams were like 20000 or 30000, than they devided (denominated) all prices and salaries by 10000.
I was fortuante that my family wasn't affected, we had foreign reserves, so to say.
Plus the whole country had the productive capasity to produce it self out of that crisis.
As far as intersts, banks can have 10% margin, but with yesterdays money it doesn't make much difference.
i.e.having 60% on $100000 on May 1st (where you can buy 100000 loafs of bread principle and 60000 loafs interest), three months later they can even put 100%, but in terms of bread it would be 10000 loafs and 10000 intrest, still a fraction of the initial debt. The time people would suffer big time is when the government would implement denomination, with unfavourable exchange for the people, which is likely and the loaf to mortgage ratio would stay at the same pre-inflation level.

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