4 ms·
Interesting, thanks for posting that (it is probably what the author is basing it on)...although it's probably more accurate to call this one theory of how it c
by barmstrong 16y ago
Interesting, thanks for posting that (it is probably what the author is basing it on)...although it's probably more accurate to call this one theory of how it could happen.
The reasoning behind it doesn't fully make sense to me.
Simple reason: people spending money as fast as they can (the shot in the arm that can accelerate hyperinflation) has a natural limit: when people have no more savings! So I don't think it's correct to call this a positive feedback loop. It has a natural limit that could be reached quite quickly under hyperinflation.
Indexes can only takes things so far too - if you (as a business owner) follow them and nobody can afford your products, you'll quickly figure it out and drop prices. So it seems weird to say indexes could cause hyperinflation over any medium-long time frame.