Hyperinflation-how bad can it be?

[85 Cutlass Brougham]

I am very bored right now, and was reading up on historical hyperinflation. I came across this excerpt on Wikipedia about the worst hyperinflation ever know and found it humorously disturbing.

Hungary went through the worst inflation ever between the end of 1945 and July of 1946. In 1944, the highest denomination was 1,000 pengő. By the end of 1945, it was 10,000,000 pengő. The highest denomination in mid-1946 was 100,000,000,000,000,000,000 pengő. The rate of inflation was 4.19 quintillion (4.19 x 1018) percent. A special currency the adópengő - or tax pengő - was created for tax and postal payments [1]. The value of the adópengő was adjusted each day, by radio announcement. On January 1, 1946 one adópengő equaled one pengő. By late July, one adópengő equaled 2,000,000,000,000,000,000,000 or 2×1021pengő. When the pengo was replaced in August 1946 by the forint, the total value of all Hungarian banknotes in circulation amounted to one-thousandth of one US dollar. [12] It is the most severe known incident of inflation recorded, peaking at 4.19 × 1016 percent per month (prices double every 15 hours). The overall impact of hyperinflation: On the 1st of August, 1946 400,000,000,000,000,000,000,000,000,000 or 4×1029 (four hundred octillion [ short scale ] ) pengő became 1 forint.

One source [2] states that this hyperinflation was purposely started by trained Russian Marxists in order to destroy the Hungarian middle and upper classes. The 1946 currency reform changed the currency to forint. Previously, between 1922 and 1924 inflation in Hungary reached 98%.

I especially like that the total value of all the currency in circulation in Hungary at the time was worth less than a penny!

If you too are bored and want to read the whole article, it can be found here: http://en.wikipedia.org/wiki/Hyperinflation

 

[yourownself]

i remember learning about this in school, where the hungarians were burning money to keep warm and cook their food!

crazy!