What Will Hyperinflation in the U.S. Look Like?

The blogger Gonzalo Lira has published a disturbing piece detailing what the effects of hyperinflation in the U.S. would be.

He used as an example one of the modern instances of hyperinflation -- Chile under the government of Salvador Allende. The currency became worthless, and when consumer goods ran out and were rationed, people perceived as unfriendly to the government received insufficient rations or none at all. A black market soon arose, which accepted only foreign currency. The economy collapsed completely as people cashed out their assets to buy basic goods and staples on the black market.

In the U.S., the blog predicts a slightly different path to the same destination:

“If Treasuries tank ... then prices will rise for regular consumers ... [I]f the higher consumer prices continue -- or become worse ... They’ll start buying more gas now, rather than wait around for tomorrow ... Prices of commodities will rise even further ... once the American economy gets there, the effects of hyperinflation will be exactly the same [as they were in Chile].”

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