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| French Assignat from the 1792 issue: 400 livres |
Everyone thinks of inflation as being purely a financial phenomenon. However, it is much more than that. It is also a social phenomenon. As the inflation accelerates, an opportunist class rises to the top of society, and the productive class is impoverished. Inflation re-orients all economic activities, encouraging speculation at the expense of work, and forever changing the people who experience it. This societal aspect is rarely discussed.
Via ZeroHedge
Successful businesses, real estate and precious metals are the only things with real value. Money is defined by what it can buy. The stock market keeps going up and up and up, but it's not because all those companies are being more productive, it's because the dollar is worth less and less. Nobody with any money is hanging on to it because its value continues to go down, down, down. They are buying things that have real value.
30 years ago going out for lunch at a sit down restaurant cost about $5. Now it's more like $25. That's like a 5% increase every year, except since Mr. Mumbles rolled into town. Now it's like 25% every year.
Assignats were paper money (fiat currency) authorized by the Constituent Assembly in France from 1789 to 1796, during the French Revolution, to address imminent bankruptcy.
By 1796 they were pretty much worthless. We aren't there yet, but we're edging ever closer to the edge.
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