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Hyperinflation: CNBC Explains

CNBC Explains
Friday, 30 Sep 2011 | 7:55 AM ET
Hyperinflation: CNBC Explains
Although inflation is not necessarily a bad thing for a growing economy, there have been numerous historical examples when inflation runs wild--a situation called hyperinflation. Some of the worst examples of hyperinflation have seen prices double in a matter of hours, with monthly inflation rates exceeding hundreds of trillions of percent. However, monthly inflation reaching 50% is generally considered to be the threshold for hyperinflation. What is hyperinflation, how does it occur and what happens to the value of money? Salman Khan of the Khan Academy explains.

Although inflation is not necessarily a bad thing for a growing economy, there have been numerous historical examples when inflation runs wild, a situation called hyperinflation. Some of the worst examples of hyperinflation have seen prices double in a matter of hours, with monthly inflation rates exceeding hundreds of trillions of percent. However, monthly inflation reaching 50% is generally considered to be the threshold for hyperinflation. What is hyperinflation, how does it occur and what happens when inflation runs wild? Salman Khan of the Khan Academy explains.

From this video, you’ll understand:

  • The underlying reasons for hyperinflation
  • How countries throughout history have experienced hyperinflation

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