Just be glad the United States doesn’t have hyperinflation.
Consumer prices in Venezuela grew at an astounding average rate of 3,608.8% per year during the 40 years from 1980 until 2020. That meant that a product that cost 100 bolivar digitals in 1980 cost 104,800 trillion bolivar digitals by the start of 2021. By 2023, inflation had tapered off to 400% annually.
Considering that central banks such as the U.S. Federal Reserve (Fed) and the European Central Bank (ECB) aim for annual inflation targets of 2%, Venezuela’s currency and economy were clearly in crisis and its people were in deep distress. And yet, Venezuela’s crisis isn’t unique in modern world history. The conventional marker for hyperinflation is 50% per month, a number first proposed in 1956 by Phillip Cagan, a professor of economics at Columbia University.
Hyperinflation is a rapid, massive, and unmanageable increase in prices.In Hungary, just after World War II, prices doubled every 15 hours.More recently, in Zimbabwe, prices doubled every day.In the troubled Yugoslavia of the 1990s, inflation hit 50% a year.
Just be glad the United States doesn’t have hyperinflation.
Consumer prices in Venezuela grew at an astounding average rate of 3,608.8% per year during the 40 years from 1980 until 2020. That meant that a product that cost 100 bolivar digitals in 1980 cost 104,800 trillion bolivar digitals by the start of 2021. By 2023, inflation had tapered off to 400% annually.
Considering that central banks such as the U.S. Federal Reserve (Fed) and the European Central Bank (ECB) aim for annual inflation targets of 2%, Venezuela’s currency and economy were clearly in crisis and its people were in deep distress. And yet, Venezuela’s crisis isn’t unique in modern world history. The conventional marker for hyperinflation is 50% per month, a number first proposed in 1956 by Phillip Cagan, a professor of economics at Columbia University.Hyperinflation is a rapid, massive, and unmanageable increase in prices.In Hungary, just after World War II, prices doubled every 15 hours.More recently, in Zimbabwe, prices doubled every day.In the troubled Yugoslavia of the 1990s, inflation hit 50% a year.