Tuesday, June 23, 2009

Marc Faber on Hyperinflation

(Make very, very sure you mute the ad in the beginning.)

"The first period , from 1800 to 1930, when the price level was stable and actually moderately falling. We had a deflationary boom in that period. The United States had 4 million people in 1800 and in 1910 it already had 90 million inhabitants. In this period we had the entire industrialization of the US, the construction of railroads, electricity, the first cars, the first airplanes and so forth under a stable price level.

"Then the introduction of the Federal Reserve in 1930 and since then the US dollar has lost 95% of its purchasing power. We already had a lot of inflation. And if it took 100 years to lose 95% of its value, I think that the next 95% loss in purchasing power will be very quick."


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