Will we know that "hyperinflation" has arrived when the U.S. decides to re-issue the $500

gecko109

Will this be a solid indicator and sure fire sign that we have reached hyperinflationary status? Just based on the physical restraints of printing at a hyperinflationary level using the $100 as the largest bill seems very unlikely. However, we cannot neglect the treasuries that are issued when considering hyper inflation.

TheBigB

If there ever is hyperinflation in the United States, we will move off paper currency permanently to electronic transactions.

Bear

The Government does not care for high denomination notes. The reason

being that criminal activity makes heavy use of such high value notes.

DesertDweller

They won't issue higher denominations notes because they don't want you using cash.

Wolf359

<< <i>If there ever is hyperinflation in the United States, we will move off paper currency permanently to electronic transactions. >>



???

That wouldn't stop hyperinflation. Too much of anything inflates. Besides, I don't think your suggestion is possible or practical.

Wolf359

<< <i>The Government does not care for high denomination notes. The reason

being that criminal activity makes heavy use of such high value notes. >>



Got Gold?

Overdate

The EU already makes 500 euro notes, about $723 at today's exchange rate. No hyperinflation there (yet).

MoneyLA

Probably the only two places where $500 notes would be used would be in casinos and in China.

No, no $500 notes coming. But a note for $79.95 would at least help make it easier to pay for a tank of gasoline.

TheBigB

<< <i>That wouldn't stop hyperinflation. Too much of anything inflates. Besides, I don't think your suggestion is possible or practical. >>



I didn't mean that electronic transactions would influence inflation, just that it would be an opportunity to eliminate paper which the government would like to do for tracking reasons.

fastrudy

No $500 note because:
a) counterfeiting;
b) government heading for electronic cash;
c) bozos in Washington would take years trying to determine whose portrait to put on it.

pmac

The cent and dollar bill will be things of the past, ah, "collector items".

pitboss

<< <i>

<< <i>The Government does not care for high denomination notes. The reason

being that criminal activity makes heavy use of such high value notes. >>



Got Gold?


>>





This note should have Obama's picture on it.

PerryHall

<< <i>No $500 note because:
a) counterfeiting;
b) government heading for electronic cash;
c) bozos in Washington would take years trying to determine whose portrait to put on it. >>


d) the government doesn't want to facilitate the underground economy, especially criminal activity

gsa1fan

<< <i>

<< <i>No $500 note because:
a) counterfeiting;
b) government heading for electronic cash;
c) bozos in Washington would take years trying to determine whose portrait to put on it. >>


d) the government doesn't want to facilitate the underground economy, especially criminal activity >>



They prefer to throw it in our face = TBTF

secondrepublic

As it is, people don't use $50 and $100 bills very much. I don't see bigger bills anytime soon. The government doesn't want a lot of cash transactions, especially in large amounts, for tax avoidance reasons. That's true in Europe, too, which is why it's surprising they issued 500 euro notes.

57loaded

i think they will need to fix the new $100 note first.

hyperinflation is a lack of faith in the soveriegn currency. Zimbabwe gets buy using alternate sovereign currency like USD, even though they still print their money

MoneyLA

Interesting that you mention "fixing" the new $100 bill first. I just wrote a couple of articles about the new bill on my website, and its not the "printing problem" but rather the choice of certain colors: the blue ribbon and the pink glow from the security thread.

Im not sure just how "dark" that blue ribbon will be but if dark it could make Asians not want to use the currency -- and we know the $100 bill is more widely used overseas than it is here.

And the "pink glow"? Well, Im not going to comment anymore here.

Full article is on link.

I welcome your comments.

renman95

<< <i>

<< <i>

<< <i>The Government does not care for high denomination notes. The reason

being that criminal activity makes heavy use of such high value notes. >>



Got Gold?


>>





This note should have Obama's picture on it. >>


Maybe on a $1,000,000 note. But isn't that the dude (on the $100,000) that started all this mess...Fed, Income Tax...?

mhammerman

"...the choice of certain colors: the blue ribbon and the pink glow from the security thread."

Same thing with the $10 bill. They used green for the bill and red for the overprinted national icon and got an orange glow to the bill...go figure.


Why would they encourage hard cash when they are trying to get everyone to use digibuks so they can keep track of who's spending what and where. It's funny that they want to know where all the little guys spend their meager tokens so they can do some taxication on their wallets. All the while, the whales swim freely. Well, when you mix green and red, you get orange.

Got CASH?

Baley

Why would they encourage hard cash when they are trying to get everyone to use digibuks so they can keep track of who's spending what and where. It's funny that they want to know where all the little guys spend their meager tokens so they can do some taxication on their wallets. All the while, the whales swim freely. Well, when you mix green and red, you get orange.

mined your sentance for pronouns and prepositions, and absolute qualifiers; what a mother lode!


. they . they . everyone . they . who's . what . where. . they . all . their . they . their wallets. All . you. you .



question: wasn't there some hyperinflation back in the late 1970's and early 80's? how come it went away for a while ? how come this one won't come and go like a wave, too?

mhammerman

"mined your sentance for pronouns and prepositions, and absolute qualifiers; what a mother lode!"

Thanks for your observation. It seems more PC nowdays to use the pronouns more loosely so as to not actually identify entities directly. On the bright side, I have almost cured my comma-splice addiction. I will make a stronger effort to use actual nouns for indentifiers rather than pronouns and I will treat the prepositions less casually; writing clearly is a constant struggle for me.

57loaded

<< <i>
question: wasn't there some hyperinflation back in the late 1970's and early 80's? how come it went away for a while ? how come this one won't come and go like a wave, too? >>



one would need to have an understanding of what inflation means and an understanding of what hyperinflation means
we had inflation but not hyperinflation during the time period you mentioned.

PerryHall

<< <i>

<< <i>
question: wasn't there some hyperinflation back in the late 1970's and early 80's? how come it went away for a while ? how come this one won't come and go like a wave, too? >>



one would need to have an understanding of what inflation means and an understanding of what hyperinflation means
we had inflation but not hyperinflation during the time period you mentioned. >>



Didn't we have double digit inflation for a brief time during that period.

Baley

Thanks for your observation. It seems more PC nowdays to use the pronouns more loosely so as to not actually identify entities directly. On the bright side, I have almost cured my comma-splice addiction. I will make a stronger effort to use actual nouns for indentifiers rather than pronouns and I will treat the prepositions less casually; writing clearly is a constant struggle for me.

no offense intended
I'm sure you believe what you've written, it's just hard to to figure out if I agree with it unless i can understand who you're referring to, and whether you mean words like "all" and "everyone" literally

Won't the Fed's eventual ratcheting up of interest rates cure inflation, as it has in the past?

gecko109

<< <i>Thanks for your observation. It seems more PC nowdays to use the pronouns more loosely so as to not actually identify entities directly. On the bright side, I have almost cured my comma-splice addiction. I will make a stronger effort to use actual nouns for indentifiers rather than pronouns and I will treat the prepositions less casually; writing clearly is a constant struggle for me.

no offense intended
I'm sure you believe what you've written, it's just hard to to figure out if I agree with it unless i can understand who you're referring to, and whether you mean words like "all" and "everyone" literally

Won't the Fed's eventual ratcheting up of interest rates cure inflation, as it has in the past? >>




Absolutely not!!! When/if the FED raises interest rates, the borrowing of money to fund TRILLION dollar defecits becomes even that much more expensive. Even with the current miniscule rates today, the federal debt we carry comes with $400 billion in interest payments alone. Since the federal gov takes in a total of $2.7 trillion in ALL receipts, that $400 billion represents 15% of the entire revenue of the U.S. each year! And remember, thats with LOW rates of returns on each T-bond the U.S. issues. If the FED raises the rates, any new buyers of our debt will demand higher rates of return....or go elsewhere with their cash.....thus "ratcheting up" our interest payment obligations to possibly 25-30% of our entire revenue.

With "only" 15 cents of every collected dollar going straight to interest currently, the government STILL cant balance a budget.....not even by a longshot. The $3.8 trillion budget vs the $2.7 trillion in receipts means we overshot by a whopping 40%! What happens when that 15% going strictly towards interest only now becomes 30% of the total pie?

I'll give you 2 choices: Default or MASSIVE print and pay will happen. You decide which one you think it will be.

57loaded

hyper

in

wikipedia

secondrepublic

<< <i>Even with the current miniscule rates today, the federal debt we carry comes with $400 billion in interest payments alone. Since the federal gov takes in a total of $2.7 trillion in ALL receipts, that $400 billion represents 15% of the entire revenue of the U.S. each year! And remember, thats with LOW rates of returns on each T-bond the U.S. issues. If the FED raises the rates, any new buyers of our debt will demand higher rates of return....or go elsewhere with their cash.....thus "ratcheting up" our interest payment obligations to possibly 25-30% of our entire revenue.

With "only" 15 cents of every collected dollar going straight to interest currently, the government STILL cant balance a budget.....not even by a longshot. The $3.8 trillion budget vs the $2.7 trillion in receipts means we overshot by a whopping 40%! What happens when that 15% going strictly towards interest only now becomes 30% of the total pie?

I'll give you 2 choices: Default or MASSIVE print and pay will happen. You decide which one you think it will be. >>



This is an extremely important point, and one that's also crossed my mind recently. Gecko has really explained the numbers well.

There's a saying that things which can't go on forever, won't. The current budget situation is one of them.

pf70collector

The government will probably outlaw cash as we know going to electronic cash. Maybe some kind of Federal Debit Card probably charging a 1% tax for each transaction, which can only be recharged at a bank. Maybe they will have retinal scans like in the movie "Minority Report".

roadrunner

Another "minor" problem with raising interest rates is that it would trigger massive defaults/losses on a substantial portion of the $200 TRILL in interest rate swaps that our too-big-to-fail
banks now carry. Those swaps were put into place to keep interest rates artificially low. So you have to figure that the banks and govt are on the hook for the short bets.
Even if they did figure out how to handle the national debt interest payments, they would still need to devise a plan on how to neutralize those swaps. If a "mere" $10-$30 TRILL
in MBS and CDS derivatives lead to the 2008 world crash, what would a hit to the $200 TRILL in IR swaps do?

question: wasn't there some hyperinflation back in the late 1970's and early 80's? how come it went away for a while ? how come this one won't come and go like a wave, too?

These deflation and inflation cycles come and go with surprising accuracy. The last commodities/inflationary cycle lasted about 18 yrs from 1962 to 1980. We all tend to think it
was just the end of the 1970's. But our actions in the late 50's and early 1960's helped to drive that final result. Abandoning 90% silver coin in 1964 was one of the early steps in that 18 year run. A similar step early on in our current crisis was removing Glass-Steagal, merging commercial and investment banks, and ensuring no regulation to the otc derivatives market in 1999-2001. Each new era had it's own key event to signify lift-off.

The 1980-2000 period was just another cycle in the sequence....just like the current one from 2001-2018 will have similarities to what occured in the 60's and 70's. These just repeat within larger economic/cultural waves of 40, 60, 80, and 120 years. As much as we'd like to take credit for each of them, they probably come and go regardless of our typical actions. We keep making the same mistakes so the cycles occur with the same frequency.

Woodrow Wilson deserves to be on that $100,000 gold note. He gave the banksters the FED and this was their way to honor him.

Interesting that the above inflation wiki-link suggests that bankers have discredited the real bills doctrine. In reading Fekete, he suggests that the only thing that makes a gold standard
work is a real bills doctrine. Per Fekete, the gold standard failed after WW1 because the real bills doctrine was not included. Maybe it should be suggested that the banksters have
discredited themselves over and over again since 1913?

roadrunner

cladking

<< <i>Will we know that "hyperinflation" has arrived when the U.S. decides to re-issue the $500 note? >>



No! It's much more wasteful to have to lug around stacks of $100 bills to buy groceries.

Overdate

<< If a "mere" $10-$30 TRILL in MBS and CDS derivatives lead to the 2008 world crash, what would a hit to the $200 TRILL in IR swaps do? >>

We may find out. I don't see interest rates staying low much longer in today's environment of rising prices. And I don't think the next crisis can be "papered over" with bailouts and money printing, especially with the new tea-party-flavored Congress in control.

stockwiz

I'd be happy if they just got rid of the cent and paper dollar. I really thought there was a good chance they would do this in 2009 with the big anniversary but here 2 years later I'm still throwing them on the ground when I get them in change.

MoneyLA

Youre throwing the pennies and paper dollars on the ground when you get them in change?

Im sure you misspoke... and its just the pennies.

I have another idea... save the pennies for the countertop donation cans for various charities.

jdillane

what we had in the 70's was called, "stagflation". Reflecting the stagnant economy and double digit inflation. Some might recall the oil embargo, rationing and a call for energy independence too!