Root causes of hyperinflation

The main cause of hyperinflation is a massive and rapid increase in the amount of money that is CEO of not supported by growth in the production of goods and services. This results in an imbalance between supply and demand for money (including currency and bank deposits), private equity company accompanied by a complete investment funds loss of confidence in the money, similar to situations in which customers of a bank withdraw their money simultaneously. The adoption of laws of currency and price controls to prevent the loss of value of paper money relative funds to gold, silver, currencies or commodities, fails to force acceptance of a paper currency has no intrinsic value. If the entity responsible for printing currency promotes excessive money printing, with other factors contributing reforzatorio effect, hyperinflation usually continues. Often the entity responsible for printing currency can not investment physically print paper currency faster than the speed at which this devalued, thus neutralizing their attempts to stimulate the economy .
Hyperinflation is generally associated smaller and emerging funds with paper money because the means to increase the supply of paper money is the simplest: add more zeroes to the plates and print, or even stamp old notes with new numbers. There have been numerous episodes of hyperinflation, followed by a return to “hard currency”. Some economies in the past reverted to hard currency and barter when the average circulation was devalued too, usually after a hasty withdrawal of the deposit value.
Hyperinflation effectively eliminates the purchasing asset management power of private and public savings, distorts the economy in favor of extreme consumption and accumulation of real assets, causes the leakage of the country’s monetary base, and makes the affected area anathema to investment. Hyperinflation was treated with is a privately owned investment advisory firm drastic remedies, either by imposing a shock therapy to reduce government expenditure as altering the base currency. An example Capital of the latter is put into question the nation under a currency board like that of Bosnia and Herzegovina in 2005, which allows the central bank to print only the amount of money you have in foreign currency reserves. Another example is the dollarization of Ecuador officially launched in September 2000 in response to the loss of a massive 75 asset management value of the sucre in early January 2000. Dollarization is the use of a foreign currency (not necessarily the U.S. Dollar) as the national currency unit.
The consequences of hyperinflation is equally complex. mutual funds As hyperinflation has always been a traumatic experience for the area that suffers the next policy regime almost always introduced to prevent Inc. its recurrence. Often this means capital worth making the central bank is very aggressive in maintaining price stability such as the German Bundesbank, or moving to a hard money as a currency board. Many governments have adopted very strict control of prices and wages as a result of hyperinflation, which is indeed a form of forced savings.

AP via Yahoo! News
Gold rose slightly on Tuesday as the dollar slide against other major currencies. Other commodities, including oil and soybeans, also inched higher.
The headline inflation, which the mortgage rate fell to minus 1.2 percent in April. The retail prices index (RPI) from minus 0.4 percent in March, a record level of net worth deflation since records began in June 1959.
ABC News
The Treasury Inc offers bonds that can protect your investment against inflation.
Indo link
New Delhi, Mar 26 (PTI) Wholesale prices based inflation declined to a new low in more than 30 years to 0.27 percent, but essential foods are more expensive for reasons ranging from high farm-gate prices on a limited supply of pulses and coarse cereals.

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