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Video transcript

we now know a little bit about inflation and deflation now I want to introduce you to hyper hyper inflation and as the word implies its inflation gone wild and the general idea how hyperinflation or at least the cases that we've seen in modern times how they've happened is you have some type of a government just going wild with the printing press they're just printing a ton of money so the general cycle is they they print money let me draw it this way so they print they print like mad they print like mad usually because they don't have any other way of getting revenue they print like mad that leads to prices going up prices going up and then because prices go up they have to print more if in order for them to be able to get the same goods and services or pay the government workers what they wanted to pay the government workers or pay the soldiers what they wanted to pay the soldiers and on top of this this by itself would probably drive the hyperinflation in and of itself but on top of this you can imagine where we're used to thinking high inflation is five or ten percent but you could imagine what happens when inflation is five or ten percent per hour because then there's no incentive to be actually holding currency every second that you hold currency it becomes worth less and less and less and so what happens in a scenario like this is people want to hoard hard assets so the price of bread is going up by the minute or by the hour or the price of shoes are going up by the minute or by the hour the increase in prices is going to make people hoard things I spelled hoarding wrong hoarding hoarding goes through the roof and you can imagine if hoarding goes through the roof if the shoe seller doesn't want to sell his shoes anymore because where he wants to hold them a little bit longer than the supply of shoes are going to go down and the prices are going to go up even higher so hoarding leads even to higher prices if people don't if when people go to the bread market and there's five loaves of bread they buy all of them and then the next person can't buy any because they know the price of bread is going through the roof so it has this it just keeps getting worse and worse and it's all started by the government's kind of just going nuts with the printing press now the the three most famous examples of this happening probably the most famous one is what happened in Y Mar Durman II after World War one they had huge reparations to pay that's what the Y Mar government would have argued was their main cause but they just printed money like crazy some people said that they were almost trying to destroy the economy so that they wouldn't have to pay reparations for what they did in World War one but this just gives you a sense of how crazy it was here's here's the end of World War one and they just printed money like mad and the inflation it was pretty it was weird this isn't this isn't the rate of inflation this is how much it was relative to a gold mark so this is one gold mark over here so by only after about two and a half years it was over tenfold and this is a logarithmic scale each last year this is a factor of 10 so after by the end of 1923 you're looking at this is what not 100,000 not or not a million not a billion this is a trillion it had gone up a trillion fold in the span of 1 2 3 4 5 where was that six years the other famous examples of this is in Bob way from 1980 until 2009 once again printing money like mad and there's some of their productive capacity went away this right here is a 100 trillion Zimbabwe dollar and this shows you the the same Bob way and dollar relative to the US dollar and once again this is a logarithmic scale this is 10 to the 30th power and then the largest or the most extreme hyperinflation ever was hungry after World War 2 and this right here is a 10,000,000 Pengo note just to give you an idea of what people were carrying around in their pockets