TABLE: As American Federal Reserve Notes (FRN) were still backed by gold at that time, the gold price moved in tandem with the exchange rate. 1 FRN would cost 48 Reichsmarks in 1919, but 4.2 trillion in 1923.Although economic discussion centers on deflation fears, the opposite may come true. Both the Federal Reserve and the European Central Bank (ECB) will continue to monetize the debt while Western governments will be unable to find a balance between consolidation of public finances and stimulating the economy.
DISCLOSURE: Long gold bullion.
Lessons of the Weimar Republic: the history of Weimar Germany illustrates how the social, political, and cultural destruction caused by hyperinflation ... An article from: The New American