What is Hyper-Inflation?
I saw hyper-inflation first hand when I visited Argentina in 1988. At the time, their government was using the Austral as their currency and inflation was running at 387.7%. Afterwards, the currency name was changed to the Peso and eventually the hard or new Peso. Visiting last year I still found a questionable government dealing with political, economic and social unrest. Unfortunately, currency devaluation is just one of their issues. You can expect to see more changes in their currency in the years ahead. Inflation is the rising cost of daily goods and services – usually based off the Consumer Price Index. There’s a humorous quote that says, “With inflation, everything gets more valuable except money.” But it’s a great way to explain why inflation needs to be managed. Hyper-inflation is simply runaway inflation. Imagine a $2.00 gallon of milk spiking to $775.40 within a year – like in Argentina, 1988. That’s no April Fool’s joke. Some inflation is necessary for individuals to see a
