The First Ever Hyperinflation

avatar

Here we saw another introduction of gold as sound money. The economy and the population were thriving, they too had artwork and architecture that could be found nowhere else in the world: The Temples of Athena, The Temples of Zeus and The Parthenon. Again, if we take a moment to think, “What happened to such an affluent economy?”, you would be asking a very powerful question.

The money, gold and silver, that has created the empire’s wealth was being inflated and debased away. The Greeks wanted to expand their empire and conquer more parts of the world. Those in power imposed a taxation on the population to fund wars with the Babylonian Empire. The Greeks authorities received their gold coins from the population and debased them. The gold coins were melted down along with cheap metals such as copper. The gold coins were no longer gold coins but only a percentage of gold. These coins were identified with a stamp, just like you would see The Queen’s face on a one-pound coin. This is the first ever example of inflation (an important concept we will talk about later).

Hyperinflation.jpg

Source

The population weren’t aware that Greek issued coins were no longer gold coins, but only cheap metals with a wash of gold on the outside. However, when the population realised, they were devastated. It was common knowledge back then about the fundaments of sound money, and that money being gold. They held on to their valuable gold coins and started to trade with less valuable ‘Greek’ and cheap copper coins.

Posted Using LeoFinance Beta



0
0
0.000
2 comments
avatar

It's amazing how many examples of hyperinflation and printing money have been done time and time again. It's only a matter of time before people wake up and see what's happening now also.

Posted Using LeoFinance Beta

0
0
0.000