While it’s true that money makes the world go round but too much of it, like anything else in life, just stands to create more problems than before. Hyperinflation jacks up the value of currency so high that the government can hardly keep up and the citizens struggle to stay afloat. Many countries across the globe have experienced this at some point in their history while some are still struggling to get things under control. Here are five examples of history’s worst cases of inflation.
Without a doubt, Zimbabwe’s hyperinflation is one of the worst ever recorded in recent history. It all started in the 1990s, when President Robert Mugabe seized the lands of experienced white farmers and redistributed it to inexperienced black farmers. This proved to be a very unwise move—production dropped, while farms and factories were forced to shut down. At its peak, the value of money dropped so low that the government had to introduce the Z$100 trillion note. The prices of goods doubled and the unemployment rate hit an all-time low record of 80 percent.
China has experienced hyperinflation twice during its history. The first was when the government printed money to fund the Second Sino-Japanese war and again when they did the same for the Chinese Civil War that occurred shortly after. Here’s a little comparison: in 1937, one US dollar was worth 3.42 yuan. By 1945 that figure blew up to 1,222 yuan and in 1949, the conversion rate increased to a staggering 23.3 million yuan. Like many other countries who experience inflation, the Chinese government started printing more money—they even created their own bank when others refused to print it for them!
When Poland started warring with Russia in 1918, the country was already in a dire economic situation. It was already hard to finance an unexpected war with dwindling funds, so the government reluctantly started printing more money. They printed so much money that the currency finally crashed in 1923 and a US dollar was now worth 52,875 Polish marks. By the end of December, that figure had skyrocketed to a whopping 6.4 million marks and, at its peak, the Polish marks of 10.3 million by January 10, 1924. The government even planned on creating a 100-million-mark note but that never panned out.
Shortly after the breakup of the Austro-Hungarian Empire, Austria found itself at war with Czechoslovakia and Yugoslavia over its borders. To finance the war, the Austrian government started printing more money, which led to an increase of the notes in circulation by 14,250 percent between 1919 and 1923. Inflation kicked in and by 1923, a US dollar was worth 70,800 crowns compared to the 16.1 crowns in 1919. Eventually the schilling replaced the crown currency and it took some time for Austria to fully recover from the inflation.
During World War II, the occupation of Germany and Italy in Greece proved to have a negative effect on the country’s economy. The Greek drachma started depreciating in value when they were attacked by Germany in April 1941. Fearing defeat, traders began hoarding goods in large quantities and the ones who did sell demanded to be paid in gold. Their worst nightmare came true when Germany won and everything pretty much went downhill from there. The drachma depreciated even further and when the government ran out of money, the Germans simply demanded that they printed more.
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