Wednesday, January 7, 2009

The Weimar Shuffle and the Myth of Too Much Money

.
Hyperinflation - its biggest cause is too much debt, not too much money. That can escape someone who does not understand the effects of a debt based money system.


Between January and November 1923 the interest rate in Weimar Germany jumped from 19% to 900%. Do you think people have to raise their prices to pay their debts when interest rates are climbing that fast?


It wasn't that the government was "printing" too much money - it was that the interest on the debt was crushing people and businesses.

They found it necessary to raise their prices daily, sometimes hourly, in order to afford to pay the loans that they had.

Q: Why is it that everyone seems to know the same story about a wheelbarrow full of money to buy a loaf of bread, but not 1 in a 10,000 knows how money is created and the effects of borrowing at interest?

A: I'll have to let you decide.
.