I started a thread in a theological forum in Facebook about inflation. Initially, I shared two articles from "The Freeman" both written by Henry Hazlitt in 1976.
One commenter gave his comment and shared the NSO link:
"Inflation in the Philippines goes down to 2.1 percent last August from 2.5 percent in July. The National Statistics Office (NSO) said that this was the lowest level since 2009."
" In the US, Austrian economists think that winning the inflation debate is vital in their fight for economic freedom. Here in the PH, the NSO data is already considered good news compared to other nations' economies. Matagal pa naman daw tayo bago makaranas ng "bagyo". I initiated this thread thinking that as Christian leaders, it is also part of our duty to know both sides of the story. The way mainstream economists use the term "inflation" is different from the way classical liberals use it."
And then I returned to the first article I shared and made some notes. Below are the notes I made:
Note # 1 - Examples of Hyperinflation in History
"When the inflation is sufficiently severe and prolonged, however, when it becomes what is called a hyperinflation, people begin at last to recognize it as the catastrophe it really is. There have been scores of hyperinflations in history—in ancient Rome under Diocletian, in the American colonies under the Continental Congress in 1781, in the French Revolution from 1790 to 1796, and after World War I in Austria, Hungary, Poland, and Russia, not to mention in three or four Latin American countries today."
Note # 2 - German hyperinflation as the most spectacular of all
"But the most spectacular hyperinflation in history, and also the one for which we have the most adequate statistics, occurred in Germany in the years from 1919 to the end of 1923."
"By November 15, 1923, the day the inflation was officially ended, it had issued the incredible sum of 92.8 quintillion (92,800,000,000,000,000,000) paper marks. A few days later (on November 20) a new currency, the rentenmark, was issued. The old marks were made convertible into it at a rate of a trillion to one."
Note # 3 - Three Stages of Inflation
Stage 1 - "...prices do not increase nearly as much as the increase in the paper money circulation. This is because the man in the street is hardly aware that the money supply is being increased. He still has confidence in the money and in the pre-existing price level. He may even postpone some intended purchases because prices seem to him abnormally high, and he still hopes that they will soon fall back to their old levels."
Stage 2 - "...when people become aware that the money stock has increased, and is still increasing. Prices then go up approximately as much as the quantity of money is increased. ...But Stage Two, in fact, may last only for a short time. People begin to assume that the government is going to keep increasing the issuance of paper money indefinitely, and even at an accelerating rate. They lose all trust in it."
Stage 3 - "...when prices begin to increase far faster than the government increases, or even than it can increase, the stock of money."
Note # 4 - Summary of German Hyperinflation
"At first inflation stimulated production because of the divergence between the internal and external values of the mark, but later it exercised an increasingly disadvantageous influence, disorganizing and limiting production. It annihilated thrift, it made reform of the national budget impossible for years, ... it destroyed incalculable moral and intellectual values. It provoked a serious revolution in social classes, a few people accumulating wealth and forming a class of usurpers of national property, whilst millions of individuals were thrown into poverty. It was a distressing preoccupation and constant torment of innumerable families, it poisoned the German people by spreading among all classes the spirit of speculation and by diverting them from proper and regular work, and it was the cause of incessant political and moral disturbance. It is indeed easy enough to understand why the record of the sad years 1919-23 always weighs like a nightmare on the German people? "
"The demoralization that the debasement of the currency left in its wake played a major role in bringing Adolf Hitler into power in 1933."