Not even close. The Germans were spending $64,000 marks for a loaf of bread.
How about this...
20 million DM postage stamp, to mail a letter.
Mark
Posted on 05/28/2008 6:45:06 AM PDT by Dick Bachert
Probably almost everyone is familiar with the hyperinflationary episode that engulfed Germany after the First World War. That nation’s economy was crippled by monetary problems that resulted in dreadful personal hardships, even though up to that time Germany had achieved one of the highest living standards in the world.
The newly formed German government, named for the city where their constitution was drafted after the Kaiser’s abdication in 1918, kept pumping up the money supply. The process started relatively slowly, but quickly the pace of money creation accelerated.
The Weimar government was paying its bills on credit – just like Zimbabwe is now doing. The Weimar government was issuing currency in exchange for valuable goods and services that it was receiving, and the vendors of those goods and services accepted the newly issued currency in the expectation that they would be able to exchange it for goods and services of like value. However, they soon realized that they were deluding themselves. Prices were rising rapidly, with the consequence that a flight from the currency into commodities and other tangibles began.
There was no discipline on the creation of new currency, with the result that it was being issued to excess. Within a few short years, the German government eventually destroyed the Reichsmark, the currency it had been issuing, making the words Weimar Germany synonymous with hyperinflation, economic collapse, deprivation and personal hardship. All the wealth saved in Reichsmarks was wiped out.
For example, in his classic book, “Paper Money”, penned three decades ago under the pen name of Adam Smith, George J.W. Goodman recounts the story of Walter Levy, an internationally known German-born oil consultant in New York. Levy told him: “My father was a lawyer, and he had taken out an insurance policy in 1903. Every month he had made the payments faithfully. It was a 20-year policy, and when it came due, he cashed it in and bought a single loaf of bread.”
As the inflation worsened, people sold whatever they could to survive. Widdig succinctly describes it in the caption to the above photo as follows: “The impoverished middle class has to sell its cherished possessions.”He should have correctly stated though that it was the “newly impoverished middle class”. They only became destitute after the inflation had destroyed their savings and ability to maintain their standard of living.
Sadly, the problems of Weimar Germany are now appearing in the US. To survive the impact of rising prices, Americans today – like Germans did eight decades ago – are selling cherished possessions, as explained in a recent story by Associated Press entitled “Americans unload prized belongings to make ends meet”. The full article is available at the following link: http://abcnews.go.com/Business/Economy/story?id=4750846&page=1
AP explains how some Americans are trying to cope with the ravages of inflation: “To meet higher gas, food and prescription drug bills, they are selling off grandmother's dishes and their own belongings. Some of the household purging has been extremely painful - families forced to part with heirlooms.” It is indeed no doubt painful, just as it was for the Germans in the photograph above, who surely must have been putting on a brave face for the photographer.
Confirmation of the AP story came a few days later on May 14th from an article in the Washington Post, which reported: “Nearly seven in 10 Americans are worried about maintaining their standard of living, as concern has spiked higher in just the past five months, according to a new Washington Post-ABC News poll. Soaring consumer prices are a major challenge, with many people struggling under the weight of the rising costs of fuel, food and health care. The poll shows that the weak economy and rising prices are high among voters' concerns, and contribute to a souring national mood in this presidential election year. More than eight in 10 said the country has veered pretty seriously off-track, and a separate poll released yesterday by ABC showed economic anxiety at its highest level on record since 1981. Overall, 68 percent of people surveyed in the new Post-ABC poll said they were concerned about their ability to keep up their lifestyles, a jump of 17 percentage points since December. The increase cuts across party and income lines.”
Crude oil is $132. Corn is $6.The cost of everything is rising. Inflation is worsening, and it’s not hard to understand why. M3, the total quantity of dollars, is now growing by 17% per annum. Weimar inflation has arrived in America.
The Federal Reserve is following the footsteps of the central bank in Weimar Germany. It is the same path taken by many central banks that have issued countless fiat currencies based on nothing but government promises. It is the path to the fiat currency graveyard, and the once almighty US dollar – which long ago used to be “as good as gold”, just like the Reichsmark once held that same exalted title – is knocking at the graveyard’s gate.
This insight about the importance of gold and shortcomings of fiat currency is not suprising, nor is it new. Here is what Rep. Howard Buffett, father of Wall Street legend Warren Buffett, had to say on May 4, 1948. “Our finances will never be brought into order until Congress is compelled to do so. Making our money redeemable in gold will create this compulsion.”
Absent that compulsion, the dollar is going the way of the Reichsmark. Don’t count on the US government to do the right thing and make the dollar redeemable into gold. Instead, take those steps necessary to protect yourself and your family to prepare for the dollar’s inflationary collapse. Buy gold. Buy silver. Avoid the US dollar.
by James Turk
*****
James Turk is the Founder & Chairman of GoldMoney.com . He is the co-author of The Coming Collapse of the Dollar, which has been updated for a newly released paperback version, now entitled The Collapse of the Dollar .
I wish I could, I don’t have that much money! ;)
Treasury has lowered the minimum purchase amounts for its’ TreasuryDirect online accounts that anyone can open. The paper savings bonds accumulated can be converted to online ledger accounts even.
Still, there is a huge demographic that doesn’t know anything about computers and probably will never care to learn. Those I-bonds were a pretty good deal (at times) for those who wanted to park a nice chunk of money in a safe spot, and have favorable tax advantages. They aren’t a marketable security though.
One of my plastic pipe suppliers stopped making a price list because the prices were going up weekly and the rep of one of the others just made the announcement they are raising their prices across the board 28%
Depends on the product/service.
For example: gasoline went up from $3.92 to $4.11 in my area within a 9 day period. That's approximately a 5% jump in a little over a week. A loaf a bread last year cost me around $2.79 last year (not on sale), the same loaf is at around $4.19 one year later.
I bought a 10lb bag of rice a few months ago at $3.66. This past weekend it was $8.88.
Not me. I got my BAHOG.
A couple of weeks ago I was in rural Appalachia having lunch at a hole-n-the-wall. Sitting next to me were two old coots who were talking about their lawnmowing jobs.
I overheard one quiz the other about why one shrub at a big job wasn't growing. The other rustled himself up enough to say that he would "look it up online when he got home tonight to see if it was a low light or full sunlight shrub."
The moral of this little incident is: when rural Appalachian old-timers have adopted the Internet...***EVERYONE*** is on-line.
So don't go kidding yourself that there are people who aren't online. Maybe at a few nursing homes on invalid beds, but the rest of the U.S. is online now.
Nah, the plural of anecdote is not data. Trust me, there are millions who don’t *like* computers, and want nothing to do with them.
Ten years ago I’d buy that line.
well its not worth diverting a point that isn’t the point, suffice it to say there are millions that don’t use banks, much less buy T-bills, notes and TIPS through the TreasuryDirect website. It’s easier than ever before for those of modest means absolutely correct, (and no commissions!) but that’s another matter. Willing and able are joined at the hip.
Not even close. The Germans were spending $64,000 marks for a loaf of bread.
How about this...
20 million DM postage stamp, to mail a letter.
Mark
I knew someone from Germany who lived through this. He said they took their pay home in wheel barrows.
...the prices that had doubled from 1914 to 1919 doubled again during just five months in 1922. Milk went from 7 Marks per liter to 16; beer from 5.6 to 18. There were complaints about the high cost of living. Professors and civil servants complained of getting squeezed. Factory workers pressed for wage increases. An underground economy developed, aided by a desire to beat the tax collector... Rathenau's state funeral was a national trauma. The nervous citizens of the Ruhr were already getting their money out of the currency and into real goods -- diamonds, works of art, safe real estate. Now ordinary Germans began to get out of Marks and into real goods... As prices went up, the amounts of currency demanded were greater, and the German Central Bank responded to the demands... The price increases began to be dizzying. Menus in cafes could not be revised quickly enough. A student at Freiburg University ordered a cup of coffee at a cafe. The price on the menu was 5,000 Marks. He had two cups. When the bill came, it was for 14,000 Marks. "If you want to save money," he was told, "and you want two cups of coffee, you should order them both at the same time." ...A factory worker described payday, which was every day at 11:00 a.m.: "At 11:00 in the morning a siren sounded, and everybody gathered in the factory forecourt, where a five-ton lorry was drawn up loaded brimful with paper money. The chief cashier and his assistants climbed up on top. They read out names and just threw out bundles of notes. As soon as you had caught one you made a dash for the nearest shop and bought just anything that was going." Teachers, paid at 10:00 a.m., brought their money to the playground, where relatives took the bundles and hurried off with them... The flight from currency that had begun with the buying of diamonds, gold, country houses, and antiques now extended to minor and almost useless items -- bric-a-brac, soap, hairpins. The law-abiding country crumbled into petty thievery. Copper pipes and brass armatures weren't safe. Gasoline was siphoned from cars. People bought things they didn't need and used them to barter -- a pair of shoes for a shirt, some crockery for coffee... When the 1,000-billion Mark note came out, few bothered to collect the change when they spent it. By November 1923, with one dollar equal to one trillion Marks, the breakdown was complete.
No unstated agenda here. No sirree.
/sarc
Feel free to send me all your useless US currency.
Zimbabwe inflation now over 1 million percent
AP on Yahoo | 5/21/08 | Angus Shaw - ap
Posted on 05/21/2008 9:19:12 AM PDT by NormsRevenge
http://www.freerepublic.com/focus/f-news/2019198/posts
Zimbabwe introduces half-a-billion dollar note
AFP on Yahoo | 5/15/08 | AFP
Posted on 05/15/2008 11:41:50 AM PDT by NormsRevenge
http://www.freerepublic.com/focus/f-news/2016440/posts
“Sorry the Fed isn’t running the printing presses.”
Hahahahaaha
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