All fake money eventually trades at its intrinsic market value.

Today it's Venezuela's turn for another plunge in the value of their junk currency.  The take away here is that people think hyperinflation is caused by money printing but that is only vaguely true.  Hyperinflation, in most people's minds, is an increase in base money + debt relative to the goods and services being produced by the economy.   If money printing or debt ontake gets too high then it will eventually cause hyperinflation.  But a collapse in the productive output will have the same effect. 

More importantly, however, is that when you have unbacked currency then it is already intrinsically worthless and thus the "fundamentals" of money printing and production no longer really apply.  When the money is intrinsically worth zero, the only thing that causes it to trade at something other than zero is confidence in the issuer.  Fortunately for the issuers of global fiat currencies, a sucker is born every day.  This is why they can run their scams for decades at a time while skimming value off the top with all their dirty deals and back room money games.

The important thing to know is that hyperinflation occurs so rapidly not because of sudden ontake of debt or of sudden massive printing of base currency (AKA the monetary base).  The loss of purchasing power which is the real measurement of hyperinflation always comes because of loss of confidence in the con game by the people.  That is when the con game ends.  Hyperinflation is the end of the con game for a particular currency.  And then the leaders get ousted, some new con men get installed, they give a slightly better deal than the old con men, tell slightly fewer lies and then always institute their fake money system again ASAP for that is their real goal.  Without being able to get filthy rich gaming the system, politicians would not want the job.  And without a fraudulent money supply in place they cannot safely defraud the people in any significant way.

And so here is my open letter to the people of Argentina (sorry for the lack of punctuation, hope you can still read it):

Querida gente buena de La Argentina,
Muchos de ustedes no entienden por qué su dinero es como una mierda.  La verdad es que no es el dinero.  Es el papel, nada mas.  Tiene valor solo en sus suenos.  El dinero papel no tiene ningun valor mas de lo que imaginas que hace.  Este papel moneda tiene valor de cero y solo un tonto cree algo diferente.  En un futuro muy proximo, cuando el Bolivar no puede comprar ni siquiera un perro muerto, que van a pensar?   Van a empezar a entender que se tratan de sus lideres rasga apagado con su principal arma en contra de ustedes ser un suministro de dinero falso? Cuanto mierda se van a comer antes de aprender? Cuando su dinero falso va sin valor, ustedes tendran la oportunidad de mostrar algo de liderazgo en el mundo de nuevo. La mejor manera es crear una oferta de dinero honesto que se basa en el oro y la plata, no las promesas y las posturas de los politicos ni los banqueros.  Ha llegado la hora de despertar.

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