I was listening to Murray Rothbard on iTunesU discuss Keynes. I was surprised that he said that sometimes Keynes made sense in some of his writings (most definitely not his “General Theory”). He especially remarked that one of Keynes’ early small book on money (I didn’t catch the title) had a profound insight on hyperinflation.
Hyperinflation is how the people prevent the government from stealing their resources.
This makes a lot of sense to me. The government creates fiat currency to get others to give up real assets in exchange for that money. At some point, when the people decide to stop being exploited, the jig is up. The people count the money as worthless and the government is no longer able to get things in exchange for it.
It is a horrible crisis for the society that lacks a currency for awhile, but usually (I think?) the government doesn’t survive the crisis.
So hyperinflation is society’s way of ending the states counterfeiting regime.
Sadly, our government is probably going to succeed in scarfing up societal resources for some time in the future. If we ever have hyperinflation, it will probably not be soon.<>
