The Worst Hyperinflations in History: Hungary in 1946 (2014)

Re:The Worst Hyperinflations in History: Hungary in 1946 (2014) by Jtsummers on Wednesday February 14, 2018 @01:53PM (#16378211)

Venezuelan hyperinflation began in 2015 [0]. Crude prices were on their way down at that point [1]. And Venezuelan oil production has been dropping continuously since 2006 [2]. The average reduction in production since 2006 was 3.17%. The overall reduction was 27.8% in that time period. Since I only found production numbers through 2016, you can see that there was an 8.85% drop in production between 2015 and 2016. If prices had stayed high the reduced production capacity wouldn't have hit so hard. If production capacity had stayed high the price drop wouldn't have mattered as much. Unfortunately they hit at the same time.

The oil situation probably became the tipping point when compounded with their monetary policies and price control efforts.

[0] https://tradingeconomics.com/venezuela/inflation-cpi

[1] http://www.macrotrends.net/1369/crude-oil-price-history-char...

[2] https://ycharts.com/indicators/venezuela_oil_production (barrels per day, average across the year, goes through 2016)

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Re:The Worst Hyperinflations in History: Hungary in 1946 (2014) by lnino on Wednesday February 14, 2018 @02:40PM (#16378687)

So, 30% a year is just business as usual? Yes, oil hit then hard. But they already had pretty high inflation before. Not sure what counts as "hyper". Certainly having my salary go down 10% a year automatically is not a reasonable proposition.

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Re:The Worst Hyperinflations in History: Hungary in 1946 (2014) by Jtsummers on Wednesday February 14, 2018 @02:49PM (#16378764)

I agree with your general point, monetary policy was the cause of much of the inflation and had they not mismanaged their oil industry they may have been able to survive with the bad monetary policy much longer. And better monetary policy may have put them in a position to handle the issues in the oil industry. But the immediate need to print more money was the drop in production capacity and price, which is what led to the hyperinflation at the end of 2015 to present.

Hyperinflation is usually very, very high inflation. Original definition was 50% monthly inflation (this would be 600% annual, higher actually since it would be compounding). 30% annual inflation isn't hyperinflation (though it's certainly not good, and after several years could be catastrophic on its own).

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